Bodal June 2018 quarter profit rose 34% yoy and also revenue up 23% yoy. Why stock is falling though it produced good result?
June 17 June 18
Revenue 286 352
OPM 17.48%. 18.13%
Profit 28 38
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Almost the whole market behaves that way. Good results, but stock drifts lower…
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Because mkt looks for future results. You should not expect some extraordinary profits in Chemical
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Currently the situation in china is good for indian chemical companies. Earlier they (chinese) sold at lower price on account of cheap labour, virtual disdain for environment and low energy cost. Today the environment is high on government agenda leading closures, relocation and upgradation of plants which is expensive.
Earlier Indian companies either made losses or worked on low margins. But currently the price of material from China has gone up by 10-50 % approx. I have come across companies who are now seeing demand from China i.e. their competitors from china now wants to buy from them (bodal is one such co).
I think sudden spurt in Indo Amines stock can be attributed to this, I could link it to shortage of one intermediate from China - which this company is manufacturing. The shortage of that product from china and spurt in price happened in almost same week. this can be a coincidence also.
Ofcourse this situation will not continue forever, but the price that prevailed earlier will also not be viable for chinese guys too. So the price will remain a tad higher in the long run. I may be wrong. But there are good chances
It is good time for companies who were competing with chinese. Since they are already manufacturing these chemicals, they will be able to increase prices without incremental cost.
I have not studied many chemical companies but it looks like they are in for good time for next two years at least.
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Moreover they are also going to incorporate wholly owned subsidiary in CHINA, which speaks alot about closure of capacities in China.
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I don’t think there was any con-call yesterday. It was Investor’s meet, which usually implies meeting with Analysts/Investors who cover and/or are interested in the Company.
Promoters are buying again very positive sign indeed.Taking advantage of every fall below 110.
Seems they are quite upbeat about their future prospects.
If my memory is right, this promoter guy had offloaded huge chunk at higher price earlier and now buying at lesser price. Pl check the same for the past 1-2 years history of promoter transactions.
Bodal may do well given what appears to be favourable tailwinds for specialty chemicals companies due to China restrictions. Whether things have changed in China now, I don’t know, but still, they are in a good position.
That said, Bodal is also the kind of company to stay away from. Their corporate governance leaves a lot to be desired. Promoters who indulge in such frequent purchase/sale transactions of their own shares have only one eye on their business, and are more than willing to enrich themselves at the cost of minority shareholders.
There has also been little information about the delays associated with the Vinyl Sulphone capacity expansion and as that detailed post by Dr. Vijay Malik showed, their diversification track record has been quite poor and shows a lack of strategic thinking. They also seem to have learnt the art of ‘article placement’ on sites like moneycontrol.com when the time is right.
In summary, this is a management I don’t trust much anymore and have come to the conclusion that it’s a fairly operator/promoter driven stock.
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Hv checked all the promoters transactions from 2008 until now.
Suresh J Patel sold shares only once in 2011 around 0.50% of his total stake.
Other than that only non core promoters were selling.
Bhavin S Patel and Ankit S Patel are also buying from last many years.
And moreover their stake came down bcoz of QIP not bcoz of any selling by core promoters.
Earlier there was a lot of pledging after exiting CDR and finishing of their debt now they hav also removed pledge on their shares.
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More promoter buying (5th and 8th Oct). I think this quarter (if not the whole year) should be very positive. While the company is a commodity play, it appears that the Chinese situation is providing a good opportunity for the company.
Yes , looks crazy though. All most every day they’re buying.
september shareholdign is out…there is no change in promoter shareholding…have promoters started buying only in october?
Yeah they started acquiring shares on 1st oct.
FYI - “Bodal Chemicals has temporarily shut down certain operations in certain intermediiates and Dyestuffs due to certain environmental issues – accidental leakage of Ammonia. This disruption is likely to be set right in the next few weeks.” - https://udaipurkiran.com/bodal-chemicals-temporarily-shuts-operations-in-certain-intermediates-dyestuffs/
Q2 results
Topline +54%
Bottomline +81%
EBITDA UP 60%
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Stellar results on all counts - except for some pressure on EBITDA % due to high raw materials cost (maybe Caustic soda and chlorine prices impact?). And the stock’s done nothing so far - as I thought, any stock price movements will probably be operator driven here. Let’s see if I am proved wrong!