Vikas Ecotech - Chemical Company

(yudiagg) #183

I agree with you. I am doing the same. However, you may like to download Q3 presentation shared by the company. It is either at BSE site or at their website.

(Satya Prakash) #184

Yes, that is in plan. Thanks for reminding though.

(SP) #185

Looks like Vikas is all set to take off in a big way…

(rvetri) #186

Hi Sivaprasad - Thanks…That is a structural change in the PVC pipe
sector…It will have a big benefit for Vikas Eco

(Satya Prakash) #187

That could be a very good news if environmental reason start pushing Vikas Ecotech products.

But I don’t understand why it’s sales has not improved in one year when it has completed Capex at Dahej plant in June 2016?

(goutam) #188

Demerger news of Vikas Ecotech

(goutam) #189

Company presentation giving more insights into the demerger process

(rvetri) #190

As Vikas ecotech has set aside Rs 16 crore of its profits due to the fire
in Q4, can we assume that this Rs 16 crore or a little less will be
recognised later as exceptional income when the company’s claims on
insurance is settled…Anyone has that details of the property being insured
for fire !!!

(drrahultrivedi) #191

Continues with 5 percent dividend. 5 paisa/ share.

(Ram Arvin) #192

Watching Vikas ecotech for last three quarters…there is no commentary by the Mgt on the growth, future plans or any conference calls…every quarter they come out with some reason…in Q3 they said because of demo sales was affected, then one new factory machines burnt and then now Demerger…I expect the Mgt to talk more abt their business but could not find any source

Also the recent new order from Latin America, there is no information on the sales growth or margins

Don’t have much hopes but holding on to see what happens

(goutam) #193

Vikas Garg (MD) has mentioned that with the settlement of claims , the extraordinary loss would be reversed in the subsequent quarters .

(rvetri) #194

Latest research report of BoB capital with a BUY rating and target of Rs 42…BoB also says NGT has asked the govt to implement lead free PVC pipes within four months…
Vikas Eco 5th June.pdf (643.4 KB)

(yudiagg) #195

Thanks for sharing. Very encouraging report with realistic estimates.
However, I presume that the valuations of the demerged entity will be in
addition to valuation of the parent. If so ,combined valuation could be
much higher…

(Satya Prakash) #196

Here is Demerger news put into points:

  • EBIT contribution of demerged entity is 2-3%, turnover of demerged entity will be 33%.

  • High value will be retained in Vikas Ecotech, and high volume (trading) will be in demerged entity,

  • 20 cr debt will be shifted to new entity out of 135 cr,

  • EBITDA margin will improve from 17-18% to 25% after demerger.

  • Demerger will be effective 1st of April and next qtr result will be of demerged entity.


Disclosure: Invested.

(ravish) #197

As per the management they are going to issue 1 share of Vikas Multicorp Limited (VML) for 1 share of Viaks Ecotech. As per my understanding they will issue more than 16.74 crore shares ( Vikas Ecotech equity share 27.9 crore, public holding 60% so 27.960/100=16.74 crore). Further new company VML will have 75% promoter holding so total equity of new company will be =67 crore( 25%= 16.74 then 100%=16.74100/25=66.94 crore).

  1. So we will have one company with 122crore sales with 2% so 2.4 crore EBITDA with 20 crore debt so no profit no loss trading company. How we will value it?

  2. New Vikas Ecotech did 250 crore sales with 50 crore EBITDA or 40 core net profit ( i m excluding one time loss to give approximate value to the company i m no expert so please help me out with my mistakes or doubt) so eps will be 40/27.9=1.4 rupees.

i m giving it 15 PE because its new capacity and the growth management is talking about . so market cap of VIkas Ecotech would be 1.41527.9=585 crore which is 10% less from current market cap. Any value more than 50 crore market cap to Vikas Multicorp Limited will be a gain from here onwards.

My concern is about management commentary they always give high target and fails to deliver it.
Please share your views and concerns.

(Satya Prakash) #198

I never worked on the possible shares that could be issued. So, I cannot comment on the above. Anyone else who know about it can tell us about the gain or less arising out the demerger. But I feel something awkward when company is so small and management want to split it. On TTM basis Annual sales is just 372 Cr. I see it a very small company. Cannot they manage it combined!

(yudiagg) #199

If we look at the big picture, the demand for its product is expected to
shoot up significantly resulting in improved top line and bottom line We
hope that will support the stock price. I think next two quarters should
give a very clear picture. Their prime vendor investing his own money at Rs
17/share instills confidence.

(Rahulj) #200

Corporate governance is suspect. Rather than focussing on business company is doing all sorts of financial jugglery. Not a very good sign. I have a tracking position but may sell if things dont change soon

(yudiagg) #201

May I request you to share instances of suspect corporate governance pl.

(lifetrix) #202

i am a new entrant to vikas, recently stumbled on this forum as well when looking online. i checked the website of MoEf, gujarat state environmetal authority and even district portals. when i search “vikas”, there is no mention of any environmental clearance being applied by the company anywhere. this could be a cause of concern because i have read that co said it is taking time for getting environmental clearance but it seems they are still to apply for the license which is not understandable. is the plant even supposed to be operational. i am posting the links below and anyone can check.