Camlin Fine Science Limited --- Looks interesting but some way to go

(Rudra Chowdhury) #108

Very high debt laden expansions are sure shot recipe for disaster and lead to many bankruptcies in the past.
Why one can be a bit hopeful, that they would not completely mess up the Dahej expansion is because of their past execution history. They have successfully executed mega integration towards higher sales with improved margins while managing heavy debt almost 2-2.5x of equity.

(Rudra Chowdhury) #109

Based on the March 2018 Balance Sheet, we see the large rise in Fixed Assets as well as CWIP.
Equity raised significantly, so that gearing is somewhat balance even with elevated debt.

Also this business will remain Working Capital heavy and would need lot of working capital debt going into FY19 and FY20.

In Summary, we have a business with 13% OCF to Sales (FY2016) during business-as-usual period.
Looking at FY20 projected OCF, one is getting a chance to on-board a business at 8-10x OCF/FY20 Sales at 1121 Cr current market cap.

Disclosure : Invested

(nitin.verma) #110

After a painful last couple of years, the company seems to have found its path. Thr last quarter earnings showed
back to positive at standalone level and ebitda positive at consolidated level.
The outlook article summarises
Things to watch out for : commencing of dahej plant in q4 , capacity utilisation of Chinese subsidiary Which is currently at 60% capacity utilisation, growth in Italian subsidiary which had a negative ebidta of -3%