fake double bottoms???
a series of wyckoff redistribution in uflex…
meanwhile the fundamentals are not that bad , although margins have been affected mainly due to inflation of cost of raw materials [crude dependent business]…fy18 clocked ebitda margins of 13.1%in fy18 compared to 14.2% fy17 with concurrent inflation of 14.2% in the raw materials[q4 fy18 to q4 fy17 inflation was 19% and ebitda margin compressed form 13.5% fy17 to 12.3% fy18 ] and the price earning ratio is already at 6, some one seems still trying to bring the price even cheaper…
potential plays are …
1.Aseptic Liquid Packaging
Aseptic packaging is a growing industry at high margins (16-20% as per management) with only
one player in India Tetra Pak. The uflex plant for the same has been commissioned already and revenues are expected to start from 2HFY19.
hence the management guides that the packaging business volume should show 10% growth including the new vertical with improved margins 15% fy19[essentially putting the business mix back on previous track (optically atleast) after this input cost inflation took the margins down this year ] [q4fy18 ebitda margin was 12.3% ]
the current production capacity stands at 3.5bn packs. The management expects sales volumes to be in the range of 1.5bn-2 bn packs in FY19 and 3bn packs by FY20
2.The company is looking to expand the hologram business capacity at its
Jammu facility. The total capex is expected to be ~Rs. 150Cr and the
expansion is likely to be complete by Q2FY19
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The BOPET film market has shown a robust growth since Q2FY18 owing
to the stable demand-supply scenario with growing demand and lack of new capcity or supply coming in , improving gross margins. The industry has seen an improvement in realizations and film prices. The company sees the growth momentum intact until FY21.
disclaimer… tracking, not invested