The company has received another dividend of 1.58cr from its Cameroon JV. This is really good. Another 1.2rs approx added to EPS.
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Really disappointed with the result…average results
Demonetisation effect has not gone away…Will linger around for some more
time
in stocks like these where the business is on a secular growth trajectory, it pays a lot more to be investor. Now, we know that their three massive projects have come on-stream from jan to mar quarter and their capacities indicate that it has potential to double prima’s EPS in next 2-3 FYs. Markets have crashed and everything but this stock has always been stable. We should not forget this too. This is coming because people have faith in their predictable earnings trajectory and management’s ability of smart capital allocation. Their dividends are also increasing every year. Anways, that’s my line of thinking. for me personally results are in line of my expectations.
another thing, the stock formed a strong bullish hammer yesterday on daily charts, clearly indicating that markets believe that around 250 ± a few %, the stock’s valuations have a bottom.
I agree with your line of thinking and therefore I have not sold a single share …But for me this quarter results has been bit disappointing …but like you said we now are sure of growth and as investors we should look at the bigger picture
I think we have been taking this talk of secular growth story a bit too far, let me tell you guys one thing - all these central american and south american nations where this company is getting a lot of growth from - are essentially BANANA REPLUBLICS - one change in some government rule or some dictator comes in or some currency movement happens - and the entire investment and profits will go away like bubbles in warm air.
So let us understand the context and politics before trying to assign the PE multiples. I think there are tremendous risks in this situation.
i think its a little too much to term Cameroon and Guatemala as “banana republics” . Cameroon has had a stable govt and even prima has been there for last 7-8 yrs now. Guatemala is poor country but by no stretch of imagination its unstable. Yes it has had its history but so has so many other countries including SA and for last so many yrs its stable… Normally the currency of a country denotes the underlying economic and political stability and it should therefore, not surprise that GTQ has been a stable currency for last 10 yrs that i know of. Infact its more stable than the brazlian Real. Basically political risk would always be there for any multi-national company but that’s something to keep on the back of our mind and not necessarily dictate the investment thesis on it. Anyways, until and unless there is reason to believe that something extraordinary is happening in those countries, i would not loose my sleep on it.
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any take from PRIMA’s AGM ?
Some salient points from the annual report for FY 17
Exchange risk
The Company makes payment in foreign currency for import of machinery and raw materials. It has also investment exposure in overseas Subsidiary and Joint Venture. The change in the exchange rate between the USD and INR may have negative impact on the Company’s result and financial condition. The Company many times don’t hedge the currency exposure and takes advantage of its natural hedge by exports of moulded articles and return on investment from Subsidiary / Joint Venture Company (JV) to some extent. The Company does not deal in derivative transaction(s) as a matter of policy.
RM Price fluctuation risk
The Company is exposed to the risk of price fluctuation on raw materials as well as finished goods. The Company apart from passing the cost to end user also manages these risks in inventory management etc. The Company developed new products to meet the growing demand and customer needs. Although the competition in the market may be increasing, your Company is able to control the same by strategic planning and improved manufacturing process.
Indian moulded furniture market was in general benefited due to lower polymer prices during most part of the year. The Company had to come to terms with increase in price of raw material compared to previous year. This has impacted the operating margins however your Company maintained a reasonable performance from its operations due to introduction of premium range.
Crude impact
Any major upward movement in the Crude Prices could change the inflationary scenario impacting on input prices and the margin of the Company.
Regulatory Risks
Further the rampant changes in regulatory laws, may pose some initial hiccups to the industry till clarity from Government authorities is received on laws implemented. Weak Global outlook can make it difficult for the country to continue on a growth plan.
New initiatives
The Company had launched new range of plastic articles with better consumer taste and expected to fetch higher demand of these products. The Company is positive on the demand growth of plastic articles in long term with higher capita income of Indian middle class. The Company is also focusing to further penetrate in new territories of Indian market. The Company has set up a Subsidiary Company at Guatemala, Central America which will take control of supply of products in the region however this may impact the quantum of goods exported from India.
GST
GST is expected to boost the growth of your Company’s business at pan India level. The Company expects to achieve about 10-15 percent annual growth in turnover in medium term.
Interest cost
The interest cost has increased to 28.23 Lakhs in comparison to 14.61 Lakhs in previous year. In consideration of the expansions completed by the Company, the control on fund management and consequential interest cost is appreciable.
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Did anyone attemd AGM for Prima? If there are any updates please post
Notes from AGM are posted on sharebazar app of Arun stockguru. Please note I am neither a subscriber to his services nor in anyways related to him. I am invested in prima and saw AGM notes over there hence shared here.
Taken from share bazar app
Q1 2018 results:
http://www.bseindia.com/xml-data/corpfiling/AttachLive/c5e639b0-e315-4b4f-9b7d-0ca4fa56fe9c.pdf
EPS 1.09 vs 1.36
Any comments?
Numbers are good…it may look average on the face but numbers are good …
not sure what you mean… you feel something is wrong ?
they have asked for a months’ extension to submit Sept Financials
The BMC will buy 10 lakh high-density polyethylene (HDPE)-lid dustbins of 10 liter capacity from Prima Plastics Ltd. at a cost of Rs 9.54 crore (each costing Rs 76.49) for a period of two years.
Source :
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