Morganite has not paid dividend consistently. Vesuvius India has
Some info on Morganite
Extract from Director’s report- 2012;
The Company has also started diversifying activities such as trading
and manufacturing of Foundry Consumables and refractory materials for
which company has started first phase of testing and development
foundry lubricant i.e. Die lube in the previous year. For the Calendar
Year 2011 total turnover of die lube business stood at 8.99 Lacs and
Operating Profit was (-16.71) Lacs and **for the half year from Jan 2012
to June 2012 total Turnover stood at 25.20 Lacs and Operative Profit
was 64 thousand, We are expecting to accelerate this are in the coming
years.**
Both have uk parent companies. Morganite has 75% pro moter holding, vesuvius at 55%. Both depend on the parent for technology transfer. How sales growth is bigger in morganite? Smaller base?
But vesuvius seems to be the more established player. Factories in kolkata,visak, salem.
Beacause of its uk promoters corporate governance issues wont be a problem?(i think so)
A 30% grower with zero debt and a pe of 9. And a persumed technology moat(their ar says so). Vesuvius is a attractive bet if it could maintain its growth. More needs to be learnt from the management and industry insight needed to know if this growth is sustainable.
Donald sir please have a look and give us your valuable opinion.
**This may bring in additional revenue without much capital spending.As its not some completely different sector,it seems to be within its area of expertise.We shouldnt be worried? **
**Thanks for this intresting pick.**
Have looked at this co earlier…and it does look very interesting for the reasons mentioned above. However, we can’t just extrapolate the past growth into future. It may and may not happen.
So I think the key is to find articles etc or interact with co to get insight on growth prospects.
Found a article that Morganite and Murugappa group are in a joint venture to produce ‘steel wool’ , its for both the domestic and export market.
But the sad point is, the
joint venture comes from the UK parent company, side stepping the Indian sub completely.Why couldnt they route it though the indian sub?
It USP in Uk is its technical expertise. It does not seem to share it with its indian sub as stated in the AR. Looks like they are only intrested in UK shareholders .
-the company has increased its dividends from 1rs to 4rs a share.
-company has been posting decent results from few quarters since the new MD took over.
-looks like an interesting MNC available at reasonable valuations…
At current price levels of 1100, PE is 20, still it’s debt free, with consistent increase in ROCE since last 3 years. With healthy free cash flows and promoter holding of 75 percent, could it be a long term prospect? Am a newbie investor and would appreciate guidance and views.
Current price per share of Morganite Crucible has crossed 1900 levels,from 1000 odd levels about a year back…providing a return of more than 90 percent…It’s dividend payout ratio and dividend per share have been consistently good over the last few years…ROCE is not bad either…Its nearest competitor is Orient Refractories which has also had a good run of late…Wonder how this has escaped the attention of most mutual funds/FIIs investing in small caps? Is it because of its low trading volumes and the fact that is only available in BSE?
