Astral polytechnik ltd

(JatinK) #361


No one can precisely know the reason for the fall… The whole market is falling… so is Astral.

I personally will wait for some more correction in Astral as INR depreciation will give it some more forex losses this quarter also. Also, I think it would not be able to show PAT growth this year due to forex losses.

Hence, I will wait. Though a lot of seniors will disagree with my views. So, its your choice after all.


(Prabeesh) #362

Yes I also would like to wait and gradually keep adding on every 5+% fall. Since the audit policy followed by Astral to include Forex on in year end there should be considerable decline after they report their year end results. Which should be good time to add.

Additionally i am not sure how much of this rupee depreciation can be passed on to end customers as all CPVC use imported raw materials. Also will that make customers to prefer PVC instead of CPVC .

We should do a ground study on these impact and come back to see where its headed.


Dear All,

Is sharp fall in CMP from 621 on July 19th to 483 close today implicates profit booking for those who entered the stock at very attractive level in 2011? Is this simply the tide of Rupees depriciation?

Kindly advice!

Regards, Vamsi

(Nikhil Moryani) #363

PVC cannot be used in place of CPVC. According to my developer friends,CPVC is only and only used as concealed pipe in bathrooms and is irreplaceable because it can tolerate high temperatures and is strong,hence better than PVC.

PVCis majorly used for external drainage lines.

The usage of CPVC is around 60-65% as compared to 45-40% of PVC/UPVC and will remain intact. Obviously so,because every housing unit at least has 2 bathrooms,definitely 1 bathroom and bathrooms have many points where the water has to flow,hence CPVC usage is more.

I would request other members to check with their developer friends and see if it corroborates.

(Vivek Gautam) #364

Lot of MF interest in Astral now .I was aware of 11% holding by Westbridge HSBC Jwalamukhi & now nearly 7 lacs shares have been purchased by 6-7 diferent MF including v reputed ones like HDFC & IDFC .Most of it seems have happened in last quarter.

Process of rerating & PE increase is on for this wonderful story.

Indian plumbers it seems are not ready to use any other pipe other than CPVC(Astral) due to big time & cost savings. Inspite of RE slowdown replacement market remains buyoant.

(Vivek Gautam) #365

Some queries for astral management

  1. with rupee depreciation a local Ashirwad dealer was despondent on FlowGuard sale due to price increase recently done n differential with Chinese RM made pipes. Are Supreme n Prince pipes really cheaper than Astral n now even GI is cheaper. How is company coping with it? In Delhi some big builders as per him like Supertech have stopped using Astral n JP may be the only builder still using Astral or Ashirwad exclusively.

  2. how is company coping with real estate slowdown n how is it impacting sale?

  3. How is blazemasterm performance going on n expected to be ? Similarly how is the performance of exports of Bendable going on ?

  4. Any plans of increasing exports to balance littelbit of massive imports?

  5. Has O & M tie up for ads resulted in launch of new ads n what other steps are being taken for strengthening the brand?

  6. How is the hedging strategy of the company ?

  7. any more plants coming up in North n east? How is the distribution muscle strengthening going on?

  8. which are the new products now being launched n Whatsbteh scalability n opp size for adhesive cement business?

  9. Ajay your 3 rd competitors has gone slack n how is Ashirwad performing under new Belgian owners? The Belgian co is the leading plumbing co of the world n how will it impact Astral?

(Vivek Gautam) #366

How is the replacement market performing? Is co active in Govt tenders market where GI still dominates? How is its PVC pipes business performing specially the recently launched column pipes? How is Hosur plant commissioning going to impact the performance of company? Has power situation in Hosur improved recently ? If not how will it cope with it?

Importantly their earlier plan of making CPVc compound in India was shelved ue to permission mot given by GOI to transport liquid chlorine by pipeline . Has the plant of making compound shifted to Thailand? Any chance of the plans being retaken as this would have insulated the co from vagaries of foreign exchange risk dueto import? How is Kaneka n other manufactures plan of making cpvc compd going on?

(Nikhil Moryani) #367

Donald Ji,did you meet the management of Astral?

(Ayush Mittal) #368

We couldn’t meet the management as they had some travel plans.

(Nikhil Moryani) #369

Alright,Ayush. Thanks

(Vivek Gautam) #370

Hearing that sales have been simply superb specially in Delhi market in last quarter Inspite of substantial price rise. Column pipes are having major demand n having waiting period of nearly a week. The company is having great pricing power like cigarette majors n might end the year with great nos IMHO .

Other members too are requested to find more from distributors dealers plumbers .

This maiden is still young n beautiful. We need not kiss all the girls.

(Prasanna Sankaranarayanan) #371

Updates|10/07/13 13:06

HIL Ltd has informed BSE that:
"HIL Limited, a C.K.Birla Group Company, is currently engaged in the business of manufacturing of various building products under the brand name of "CHARMINAR" & "AEROCON". In tandem with our motto- âUpgrading India's life spacesâ, and adding to our arsenal of building materials we are now venturing into plastic business, with cPVC and uPVC plumbing products
Constant innovation and abundant applications of plastics is changing the face of the building products Industry. Looking at the exponential growth of the Plastic plumbing products market and with intent to leverage the Companyâs pan India manufacturing, distribution and selling facilities, HIL forays into this segment by commissioning today i.e., 7th Octoberâ2013, its state of art cPVC and uPVC Pipes and Fittings manufacturing unit at Faridabad, Haryana with an initial capacity of 6000 MT, under the brand name of âAEROCON Pipes and Fittingsâ.

(Sourabh Agarwal) #372

Hi Donald,Ayush,

Is the plan to have the management meet still on the cards?

(Vinod MS) #373


Found this info in the Supreme Industries result.

“The com has successfully produced Flameguard Fire Splinkler system made from CPVC under the license of its US collaborator Spears Manufacturing Co. The same is under lab trials in US and will be submitted to BIS and Fire dept shortly”

Shows that CPVC fire splinklers are indeed a good business to get in and we can take comfort that Astral has the early mover advantage. But, yes competition is heatingup and CPVC compound availability needs to be tracked more closely now.



(Nikhil Moryani) #374

Astral will come out with results tomorrow,1st of Nov.

Concall also scheduled for tomorrow,4.30 PM,the nos. are 022 6608 5000/3946 2200.

(Kunal Pawaskar) #375

Has anyone studied the trade payables? For the last couple of years they work out to around 30-40% of annual cost of raw materials. 30% in FY13 and roughly 40% in FY12 and FY11. The supply of raw material, CPVC resin, is supposed to be critical in this industry. I remember reading in the Supreme Industries call that the access to resin supply is critical.

Does it not seem relatively too high a figure given the background?

Any views?

(Abhishek Basumallick) #376

If you look at the companies making CPVC products, no one complaining of shortage of raw material. I honestly don’t think there is any shortage or constraint of CPVC. This business is not more a distribution play and getting into new niche areas.

(Vivek Gautam) #377


Company is chugging along nicely .

1)Topline increases from 200 Cr to 255 Cr & bottomline 10 Cr to 16 Cr.

2)Inspite of recent price hike CPVC is still cheaper by 15-20% vs GI pipes.

3)New generation of plumbers dont know how to work with old GI pipes

4)Co is not facing demand problem inspite of price hike thnaks to combined demand of new projects,repairing & refurbishment of old aptt & houses.

5)Inspite of lot many new players jumping into CPVC segment Astral is not facing any problem exemplified by their pricing power,branding activity & moreover Lubrizol is so proven it stands apart by way of performance.

No body likes to take a chance when hot water line running at very high pressure.

  1. Co is aggressively adding land banks in all locations of the existing plant of Astral including Dholka, Baddi.Hosur they have incurred capex of 50 odd crore and the complex already has substantial land with them.The long term liabilites has jumped 50% because of that but the company is well placed to

take care of big demand from all corners of India.Co is expecting capex of 50 Crores in next year as well.

  1. Company passes on full cost to its customer of all rupee depreciation & PVC price increases so as to maintain its EBIDTA margins of 12-14%.

  2. Hosur plant commissioning expected in 10-15 days will be a major trigger for the co as freight costs as high as 6-7 % on a comparatively lower product price makes them uncompetitive.

This will open up low tapped south Indian market for PVC ,drainage,SWR, Column pipes besides CPVC.

  1. Column or borewell pipes is another big 2000 Crore opportunity they want to tap aggressively as so far they have been generating only 40-50 Cr from it.

  2. Bendable exports is another big opportunity still not tapped as co is facing some teething problem in Lubrizol machine commissioning though the exports to Mexico has started.

  3. Blazemaster is still exclusively with Astral & BIS has taken samples for testing n has raised some queries as well. Separate approvals from diff state govt would also have to be taken for it.Its a 1000 crore worth of opportunity.

12)Tax benefits from Baddi plants will still continue for next 2-3 years & tax will remain in range of 25-26%

13)Adhesive cement manfg which was being carried out from a rented premises so far to test & gauge the response & after seeing good response will be moved to its own premises.Co expects 50 Cr worth of business from it in next 1-2 year.

  1. CPVC generates 60% & PVC 40 % of business for the co & its having good demand for both segments.

  2. Co is very confident of not only meeting its 20% growth guidance but exceed it too.Debtors days are being reduced .Once Hosur plant is commissioned debt will further come down & operating leverage will come into play.

(Donald Francis) #378

Thanks Vivek Gautam for sharing. Good Highlights.

Good to see you monitoring your Category A investments with vigour, and making that effort to keep everyone on the same page.

Much appreciated!

3)New generation of plumbers dont know how to work with old GI pipes

)- nice to know:)


Nothing to Add! except I will initiate the due diligence on Astral shortly, for a Concall with Management.Other Astral trackers- please keep contributing from direct market experience locally, asking questions, probing for holes/corroborating management speak - as a build-up to the Concall (may happen post Nov 15th only as I will be available on & off/unavailable mostly for any serious/probing work for next 2 weeks.

Happy Diwali to all ValuePickrs!

(Vishnu Ch) #379
Conference Call from Capital Market
Astral Poly Technik
Management continues to remain optimistic about future
The company held its conference call on 1stNov'13 and was addressed by CFO Mr. Hiranand Savlani

Key highlights

Of the total sales for Q2 FY'14, about 60% of total sales came from CPVC and the rest from PVC business. During Q2 FY'14, the company was able to process 13822 MT of polymers with the volume growth of 26% YoY.

On Blazemaster, the approvals from BIS are still awaited and management is optimistic about its launch.

The company has incurred an actual loss of Rs 10 crore and MTM loss of Rs 18.35 crore on foreign currency borrowings. The MTM losses will be accounted by the end of the year. Entire forex MTM is related to foreign currency loans which comprises of ECB and foreign discounting.

CPVC is cheaper than GI by 25-30% even after the current currency rates. The preference towards CPVC will continue as the new plumbers and new generation will never go to GI pipes and plumbing.

About 40-45% of total raw material is imported.

Hosur Plant is ready for commercial production and the company will roll out the commercial production by Q4 FY'14.

The subsidiary company Advanced Adhesives achieved net sales of Rs 9.7 crore in H1 FY'14 registering a strong growth of 154% YoY. Solvent business currently is manufactured on a rental plant and management has plans to go for its own plant given the high margin and growth prospects of this business, at a capex of about Rs 20 crore which will be operational from 9 months from now.

The Baddi plant of the company enjoys 30% concession for Income tax plus the company also has MAT credit available to it, so for couple of years, the tax rate will hover around 25-26%.

Company has incurred capex of about Rs 61 crore in H1 FY'14 another Rs 10 crore in H2 FY'14. For FY'15, capex will be around Rs 50 crore which will be for machines predominately and some land near Dholka plant.

About 1.5% of total sales will be undertaken on brand building exercise.

The company has increased the prices of finished products by about 4% from June'13 so as to offset the rupee depreciation effect.

Overall management continues to remain optimistic about the future.

(Ankit Gupta) #380

As far as I remember, during the AGM they had stated that approval for BlazeMaster has been received. However, in the Q2FY14 result con call they have stated that approval for BIS is yet to be received which is surprising.