Meghmani Organics Ltd

(duranvskp) #90

@Mayank_Narula Sorry my intention was not to outsource the research I ought to be doing. I’m a neophyte to stock market.

I did look into the recently announced Q3 results I could not find that number. If some body could guide me into that direction I will be grateful for that.

(Mayank Narula) #91

Hi @duranvskp, you can refer to segment results in the published quarterly results. All 3 segments contribute almost equally to the top line, but base chemicals contribute almost 60% to bottom line.

(duranvskp) #92

@Mayank_Narula Thank you so much for your reply.

Could anybody help in identifying the exact revenue/net income that Meghmani is accruing from Caustic soda sales since basic chemicals would also include other chemicals. I’m just trying to explore the possibility to figure this out if not it is completely fine.

(anisingh) #93

I have certain doubt about meghmani. I try to avoid daily price movement and learn more about its business and industry.

But it’s been around 6 months the prices are not moving along with the results. I understand there is negative sentiment is the market as of now and it’s going down along with the market…

But earlier also it just didn’t showed very much movement.
I have 3 questions regarding this.

1 - Have the market already discounted the future earnings of meghmani is its stock price, is this the possible reasons for the stock price not moving?
2 - Is there something that I don’t know as an retail investor which the market in general have adequate knowledge of?
3 - If the stock is manipulated by the operators then why should I be invested in this stock? I mean even though it has great business prospects but the operators won’t let the stock move accordingly.

(Nolan) #94

Bull markets make us an impatient lot. June 17 quarter results had set Meghmani on a steep growth trajectory with stock giving a return of 3x already (40 to 120+) in short time. Now consolidation (started four months back in Nov 17) is also fair considering the prices had moved up fast in anticipation of future outlook. So far I haven’t heard of any negative news flow apart from a possible ban on certain pesticides. Though, it is still a proposal with no action yet. With a healthy consolidation and with earnings catching up, it looks attractive again, but the market conditions may keep the movement subdued in short term. However, irrespective of the broader market, prospects of Meghmani look bright for atleast next 1-2 years, in view of their expansion plans.

Invested. Views are personal and can be biased.

(Rushikesh Kanthamani) #95

Nice analysis, but can you tell me how you came to a pat of 145cr?
Secondly why promoters are holding 18% stake in MFL individually, like MFL is doing a very good job so why to own individually, why not MOL can increase its stake in it?
And lastly can Any one give the breakup of what capacities segment wise come under MOL and MFL.(I am unable to find them in the AR) so that we can get a clear idea of how much of the profits generated by MFL can be taken into account as per 57% holding of the company. And what % of sales from MFL are being shown in MOL’s consolidated balancesheet(57%)?

(PE_Ratio) #96

Though Meghmani is fundamentally good, technically it’s not so good right now for a rally. 6 months of consolidation is nothing in Meghmani. Look at the monthly chart of Megh below. It shows that in the past it went through 1 year of consolidation, 2 times.

Look at RSI in the chart. Whenever it went above 70 (which indicates the overbought zone), the price started falling. Only when the RSI cooled off and went below 60, and hit the 50 mark, the next leg of upmove started. I expect some more consolidation or downmove, and when the RSI hits 60 mark, I expect the next upmove. Also, the Elliott wave 4 correction is going on (look at the chart). When wave 5 starts, the upmove will begin. That can be from the 90s or even from the 80s. So, patience is what is needed. Once the upmove starts, we’ll get to see the same kind of moves that we saw from 19 to 50, and 35 to 125. If it hits 80 or below, I’m planning to add more.

Dis: Invested

(Ranjan K) #97

Please refer the below links:

I have simply added 9M FY18 + last quarter PAT after minority interest to get the TTM figures…so it’s 121.1+23.8=144.9 …regarding promoter’s stake it can be viewed as direct skin in the game…it can also be done by raising more stake in the parent company but not sure of why it’s not been done…you can get the capacities etc. details in the presentations whose links I have provided…hope this helps…

(Ranjan K) #98

Sorry…i mean last quarter of FY17 in the above message…

(Rushikesh Kanthamani) #99

Thanx for the reply, I have already gone through their investor presentations and have noted their capacities, I just want to know what amount of capacities come under MOL and what kind of capacities come under MFL(I was unable to find this on any of their investor presentation and A’r) both capacity wise and segment wise.

(duranvskp) #100

What is the PE Multiple Meghmani deserves and also elaborate on why it is justified?

Thank you.

(ASPN) #101

@Mehnazfatima, @hitesh2710

Meghmani made all time high of 129.40 on 07.11.2017. Its 61.8% fibonacci retracement level comes at approx 79.72. Today it has bounced back from level of 81.70, which is a very nearby.

Chartists kindly comment on this. Is this observation correct? Can we expect it to start upward journey now? And well, how to use the Fibonacci levels to find out the targets for upmove?

(KiranP) #102

No that’s not how Fibonacci retracement works. Retracement is based on the last upmove (i.e. low to high), not 61.8% of the stock price.

(Rushikesh Kanthamani) #103

Has anybody noticed the fall in promoter holdings from last 2 years, like it was around 63%+ in 2015 and from there it is gradually going down and down n down, now at 50.48%, is there a satisfactory reason for the same, because it is an alarming concern? Any one having any idea so as to why they are gradually decreasing their stake, I dont think its because of the capex they are needing?
Any one with any clue, pl help me understand, we need to dig deeper in this matter.

(anisingh) #104

Promotors have increased their stake by 3% around in this quarter.
Can anybody tell me that is MOL a secular growth company or cyclical in nature?
Agrochemcal is seasonal in nature but what about Basic chemical and Pigments?
Also their Trade Receivables are increasing Quarter on Quarter and also Year on Year. Is there a possibility that they might be inflating sales by selling on credit?

(Mayank Narula) #105

I don’t know from where you got 3% figure. As per inside trading disclosure, promoters have bought 15000 shares from open market.

In fact promoter holding has come down from 55% a year back to around 50% as on March.

(arunjacob) #106

compared to December quarter, stock holding , there is an increase of promoter holding by 3% . Looks like promoters are market savvy & bought the stock around Rs 82 (as per insider trading disclosure(even though quantity in those disclosures is less)).

(Yogansh) #107

Hi @arunjacob

As per BSE website there is a slight fall in promoter holding (Please see below screenshot)

Yogansh Jeswani
Disclosure: Holding

(PE_Ratio) #108

I don’t know why many are claiming (including MoneyControl) that the promoter holding went up by 3%. If I check BSE site and compare the share holding of promoters, this is what I find
December 17 quarter - 50.48% - 12,12,29,145 shares.
March 18 quarter - 50.39% - 12,12,81,164 shares.

(PE_Ratio) #109

Though the percentage went down, the number of shares went up.