Thirumalai Chemicals - A chemical Company


(cool_gaurav) #67

No it’s not trading at ex split price.


(Chandra) #68

Company Mgmt announced few months back their intention to split the stock. Approval and other legal process will take time …My guess is that the the entire stock split process may take 4 to 6 months.


(Raj A A) #70

Stock split of 10: 1 is not in Intention stage. It has been approved by the board in its May 3rd meeeting subject to shareholders approval , which is expected to be ratified in July 24th AGM. Thereafter it may take few weeks to complete the split. FYI


(Manojlion) #72

Have the sales for the value added products started?

In the annual report ,I could not find any revenue breakup for different products sold by the company

Any information on revenue generated by the company split geographically

Also if any of you have the details on how much capacity ,the company is running

I understand that it is a duopoly industry with high entry barriers, can anyone please help me understand regarding the overall demand for PAN worldwide and in India.

I am quite new to investing,so please correct me for any mistakes


(Raja) #73

Hi Everyone,

I have a question. Rally for this stock has started in 2015 where the crude oil price which is raw material for PAN has started declining and the same is visible in reduction in material costs (expenses) over the past few years which resulted in better OPM and net profit.

But my question is, as per below link on ET

->The improved profit was on account of lower import of PAN (which reduced supply) and higher crude price.
How could higher crude price (raw material) improved profit for the company which is in contrast when we look at the material cost decline in expense. Can someone please confirm if the above statement was wrong in article or my understanding was wrong as even the price chart of crude oil suggests, there was decline during 2015 phase.

->When crude dips, paint companies slow down their purchase of PAN in anticipation that the price of the chemical would soften. The reverse happens when crude price hardens
As per above assumpition, paint companies should have slowed down their purchase of PAN during 2015-2016 phase (2015 -1072 cr sales , 2016-944 cr sales).
But again from 2017 crude oil price has been increasing which should have increased the raw material cost in expenses but as per data in screener.in, its reducing every year which is ambiguous.


(vikas sinha) #74

True, there is a discrepancy. You have asked the same question, again and again, that Crude price and raw-material price trends do not match. Likely explanation is that Crude can be hedged, as also the impex forex transaction part, both these components can mitigate their direct impact of RM costs. I would rather try to analyze the correlation with the added info that the company can pass on the RM costs and also that the market has expanded, with protection from imports.

Disclosure: 2% stake in portfolio @ average price of 1685, reduced from 4% stake, invested starting since sept 2017, averaged over time.


(Raj A A) #75

The following info from AR 2018 will allay some fears expressed by members on crude oil impact.
Chairman’s message in AR 2018…
…We were able to competently manage the disruptions and
uncertainties: rising Crude and Raw material costs in the
second half of the year, knee jerk tightening of credit for
our customers after the deluge of bad debts at all major
banks, and the trade hiccups caused by demonetization
and GST.

In the Director’s Report…
…The PA business is sensitive to market volatility and business
cycles. We are now better prepared to tackle these challenges
with the policy and operational changes, implemented in the
last few years.
But the large imports of the product into India is a matter of
great concern. The Government has initiated a review of the
Anti-Dumping Duty that was in force from Dec ‘12 to Dec ‘17.
Free Trade Agreements (FTAs) are another area of worry for
the Phthalic Anhydride business. While the existing FTAs with
ASEAN and Korea had a negative effect on Indian industry, the
proposed RCEP could prove to be a more serious threat to all
Indian manufacturing and jobs. Your company is participating
actively in a series of representations to the Government
through different forums.
Notwithstanding these threats, your Company is confident of
its ability to compete and grow.