Astral polytechnik ltd

(ricky76) #461


In my experience, the markets during normal times are quite accurate in assigning PE multiples to various sectors and companies. There are plenty of industry insiders in the market that know the business a lot better than we as outsiders can possibly can.

Ratios can only be relied on to a certain extent, they are backward looking and mostly static. What really matters is future prospects.


(Rohit Chauhan) #462

anyway, the discussion has now become moot …cera has jumped and both are now close to same valuations. so mr market thinks both are great businesses :slight_smile:

(Sagar Saxena) #463

Q4 numbers are out & there seems to be some disappointment on the EPS front.
Sales: 337cr. vs. 261cr.
PAT: 27.8cr. vs. 29.2cr.
Finance Costs up 50% Yoy.
For FY14:
Sales: 1080cr. vs. 825cr.
PAT: 79cr. vs. 60.6cr.

Will be interesting to see how markets react on Monday.The stock seems to be running a bit ahead of itself.

(Sourabh Agarwal) #464

Hi sagar,

Profit After Tax**(PAT)has decreased toRs. 277.85 Mnfor the quarter as againstRs. 292.15 Mnin the previous year same quarter due to provisioning of MTM losses** at the year on account of exchange fluctuation . (On full year basis PAT has increased by30%fromRs. 595.20 MntoRs. 772.05 Mn).Though I agree that at present it has run ahead of its valuation but if I think from a ten yr perspective I would still like to hold this stock(and monitor development continuously ) .
Before selling a quality stock I read prof bakshi’s article "what happens when you buy quality " and it works wonders :slight_smile:

(Sagar Saxena) #465

Hi Sourabh,

Wow! You are ready to take a 10 year view! But doesn’t re-rating to such high multiples,dilute the returns in the long-term? Astral seems to be a very good company & I have little doubt that they will continue to grow at 30%+,but (maybe its a mental block) being active investors in the market,I think we can find better/equally good return making opportunities elsewhere.In the end,its really about an individual’s risk profile & margin of safety.
Having bought at a lower price gives a large cushion to you,but shouldn’t we be wary of such huge re-ratings? I always prefer re-rating to be gradual.Unless,of course,the earnings explode(ala cyclicals or turnarounds…case in point: Arrow Coated) If one looks at Auro Pharma(turnaround+big size),the multiple is now around 12-14X FY14E,from an earlier 7-8X multiple.So re-rating has been gradual,even though stock has more than tripled.I have a personal preference for such stocks over others.The way P/E expansion has happened for Cera too,seems unjustified.But then who am I to judge? Various factors can lead to re-rating.The biggest one being possibly,institutional interest.As investors,all we can do,is to weigh the pros & cons & check whether chips are still in our favour. :slight_smile:

(Augustine Jos) #466


inventory level looks quite high for the qtr and this has impacted PAT in Q4. copying inventory levels from P&L.

Changes in inventories of finished good & stock in trade

Q4 FY14 : 2324.21

Q3 FY14: (2669.19)

Q4 FY13: (1667.62)

if we adjust this to a constant inventory or change inventory level from -ve nos to 0 for qtr then PAT nos looks decent…

PS: I’m not sure if im doing the right thing by adjusting the inventory level.



(Tony) #467

One can see the results on Moneylife magazine.


(Ananth) #468

The other thing that pulled down net profit was higher tax rate in Q4.
There is lot of difference in Q3 and Q4 tax rates. However year on year the tax rate is same.

Q3 fy 14 tax rate 11.3% Q3 FY13 tax rate - 24.5%
Q4 FY 14 tax rate 32.10% Q4 fy13 tax rate - 25.48%

I wonder why the tax rate was less in Q3 and high in Q4 ?

Anybody has any idea on the details of conference call ? Is it tmrw ?

(Vivek Gautam) #469

So this interview was the reason for the sharp rebound. True. The co has walked the talk n with launch of so many new products, big investment in branding, pricing power, big opportunity size, establishment of cpvc compound plant finally in India, fillip to infrastructure under new govt expected co remains one in sweet spot. Discl invested.

(ricky76) #470


Did anyone attend the earnings concall or have a transcript?



(vinay ambekar) #471

Q1-FY15 results out

Sales up 25% YOY (from 216cr in Q1-FY14 to 270cr)

PAT up 67% (from 12 cr to 20 cr)

Net margin 7.41% versus 5.56% in Q1-FY14

Exceptional item of positive 0.8 cr compared to negative 5 cr (this is forex loss on purchases, i presume)

Tax paid @ 31% this Q compared to 25% in Q1-FY14

As per usual practice, they have not provided forex loss on FCB and forward contracts this quarter as well. This amount was a loss of 1.35 cr this Q compared to 15.85 cr in the previous Q. Adjusting for this, PAT would show a much larger growth.

Some other observations:

1). Depreciation has gone up from 4.9 cr to 8.1 cr, presumably due to starting the new plant.

2). However, this does not seem to have translated into corresponding sales growth. Sales growth has moderated a bit compared to 40% plus that it clocked from 2009 to 2013, which had reduced to 31% in 2014, and further to 25% this quarter

3). Inspite of increase in depreciation and tax expenses, PAT has shown significant growth with expansion of margin. The margin of 7.41% is in line with what the company had clocked for the whole of FY 14 ie 7.31%.

The concall would provide additional details regarding stabilisation and production in the new plant, status of new products, outlook for currency related items etc. 4). Forex component could infact be a positive this year given the relatively stability in the rupee and possibility of appreciation during the course of the year.

(Vivek Gautam) #472

An excellent presentation nicely encapsulating n highlighting the strengths n potential of this fast grower.

Best exemplifies how not to get distracted by PE & focus on huge opportunity size & ROCE of 38%,award winning First generation promoter with FIB,moats & USPs.

Results too have been up to the mark

Lubrizol setting up its CPVC compound manfg facility in close vicinity,launch of new products,branding exercise on,ever increasing distribution are the major positives for this fast grower ala Peter Lynch.Truly exemplifies the money printing maxim of Buy Right & Sit Tight.

(Vivek Gautam) #473

Thanks are due to Donald & Subash on informing about superb Ambit Report on Indian cos on cusp of greatness which Includes cos lIke Page,Astral,Mayur,BKT,Eclerx,VGuard etc

Truly an outstanding report from house of Ambit famous for such high quality reports.

You can mail / message me.

Also latest issue of Capitalmarket highlights cos which have achieved turnover of 1000 Crores for first time n still opportunity size is big enough for ensuring good growth in future as well.

The list include some VP favorites like Page,Astral,Kaveri Seeds,Ajanta Pharma & Avanti Feeds besides others.

(Santosh Sinha) #474

Hi vivek,

What is ur mail id, tks

(Punit) #475

Vivek - Can you please mail me at punit at punitmittal dot com

Thanks in advance.

(Administrator) #476


Please do not leave your email IDs floating in the open at public forums like VP. Perfect for crawlers looking for email IDs and spammers. If you must mention email ID at least take normal precautions like xxx at yyy dot com.

Whenever you want to contact someone - just click on the post authors name in thePosted byVivek Gautamat Sunday 02:18. You will be able to send a private message to the person without leaving email IDs open.

Vivek - Institutional Reports that are not available freely in Public domain cannot be re-distributed using public forums like VP. Please refrain from making these offers so directly.

Messages above are being edited appropriately.

(Vivek Gautam) #477


Noted. Sorry for the oversight.

(Jagan Mohan) #478


Thanks a lot Vivek for providing this info. The presentation is impressive, just as the performance of the company and its management. All in all, it is a very promising stock for long term investors.

Regards, Mohan

** Best USPs. **

** Lubrizol Tight.



(Vivek Gautam) #479

What a man and company ? Sandeep Engineer & Astral. Its true that best wealth is created by an entrepreneur owned company with Fire in Belly,execution track record,big opportunity size & good return ratios.

Astral fits all these & we should forget about PE SHE and ride this lovely compounding machine sure to grow atleast for 20-25% CAGR .

(Vivek Gautam) #480

Seems another big opportunity for Astral to exploit