Blue Chip Tex Industries Ltd - Excellent Numbers

(dharmeyshashar) #22

Hi all,

These few points were gathered from the agm :

  • They are operating at 100% capacity.

  • No capex will come this year. They are planning it for the next year.

  • They make a differentiated product which are manufactured by hardly 7 to 8 players in India.

  • They purchase from Beekaylon because Beekaylon makes a differentiated raw material.

  • Beekaylon is a backwardly integrated company and is into same line of business as Blue chip.

  • The impact of crude increase will be shown in the current quarter.

  • They pass on the raw material increase, it takes 15 days time.

Now something about my experience of the AGM. Though it was only second time that I attended an AGM, this one looked more like an informal gathering and the management avoided the explanations by suggesting to raise queries by e-mail. Tere were some senior shareholders who were interested only in why the dividend was not raised. One gentleman took 15 minutes to explain to the management why the dividend should be raised. Another one delivered “shayaries” in management praise. But when one of us interested in details stood up to ask management the critical questions, after 2 answers they told that all the queries will be answered via e-mail conversation. The above details are gathered mainly by joining an informal conversation with Shahin Khemani.

Dharmeysh Ashar

(dharmeyshashar) #23

So as of now I am of the opinion that this related party transaction and the management’s unwillingness to share the details are acting as a drag for further re-rating possibilities from the current levels. When I bought the stock, I simply projected market cap to touch their sales figure. It looks like that projection does not hold good. It definitely is not a fair practice to simultaneously run a similar business which is privately owned by the promoters. Want to know about other counters where similar practices are done by the promoters and particularly the valuations given my Mr. Market to such stocks.

Views invited.