Alufluoride Limited-conversion of waste into wealth

Hi - I have asked company on above points i have raised and also some clarity on revenue expectations on Jordan project ( maybe more for AGM when that happens ). Will keep you all posted but incase anyone has any informations then do let me know

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If possible try to check on the capability to pass on price hike to the customers

As fart as I understand, in FY19 they are able to pass on only fraction of raw material price hike (15% vs. 40% hike in price)

Though I am not fully sure about this. But if anyone can add to this point, will be helpful

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Hi Mayank

Yes I am trying to get in touch with management . I have been reading on this niche product and below is my observations till now

(1) I think Company would do very well as domestic industry is just meeting 15 percent of India demand which is a huge demand supply mismatch . I am waiting eagerly to join company AGM call when it happens as beside this questions I have questions on Jordan project profitability which I want to clarify from them

(2) China has been a major supplier of this chemical but the biggest players in China has been forced to cut supply on this due to Over utilisation of Resources and environment issue because of which price increased last year and its expected to remain reasonably same in China

(3) There are questions around absolutely massive Capital workin progress which needs more clarify on current expansion , solar project and Jordan project

Let’s see if I can ask management to share this with me

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same has been copied to 2020 financial report also.

FYI: I have finally been able to get some initial conversations started with the management. I am getting more details on this exact breakup of 35cr and if my understanding was correct or not. Hopefully will be able to give further update in next few days

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Some things to check on the accounting side:

Other income as a %age of PBT and PAT has been very high at over 50% till 2 years ago

CWIP/Gross block is 18%, very high

Certain pointers and questions from my side:
Customers: Revenue contribution from Top customer is 45% v/s 54%(2019), 2nd customer 34% v/s (35%), others >10% contribution is 14%.
More information would be needed regarding top clients and also client concentration moving forward.

States: 80% revenue from Odisha 53cr v/s 43cr(2019); MP 10cr v/s 4.5cr(2019).

Raw materials: HFC Acid (30%) and Alumina Hydrate (45%) constitute major RM costs. Price trend of these moving forward?

HFC acid : Contract with IFFCO (7000T), more details about contract?

How much HFC Acid and Alumina Hydrate are needed to produce AIF3? We know that to product 1T of aluminium we need ~25kgs of AIF3.

Market share of Alufluoride v/s Competitors (%)?

AluFlu seems to follow Aluminium trend. Aluminium last 3 years at lows. prices also at lows. Moving forward some clarity on demand, supply, price trend?

Emirates Global Aluminium - supply of Aluminuim Hydroxide - more details needed of contract?

Updates on JOrdan JV and particulars of deal wrt ALUFLU
Update son 1.4mw plant?

Other Income major portion is Silica(by-product) - more information needed on Price trend, sell to whom, Qty of by-product released etc.

More details needed on exports %, clients for exports, countries.

Order book details?

Thank you.

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This has some information about raw material challenges

https://www.moneycontrol.com/news/business/moneycontrol-research/new-contract-cycle-and-raw-material-sourcing-holds-promise-for-re-rating-of-alufluoride-3562071.html

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What are your views on the company @satish_kumar1? Since there is such dearth of information available to build a conviction to hold or book profits currently is a very difficult decision to make. But this doesn’t matter as long as the management is good & the company levels delivering with good metrics. Thanks for sharing the article cause it now gives an idea of what the company has in plan for the year & going ahead.

Dis : Invested from lower levels. Planning to hold as see good potential. Plus probably hike in aluminium should also help the company expand margins (?)

I just started looking into this today only. Went through FY19 AR. Here are my observations

Positives

  1. Company has niche product
  2. RM is sourced domestically and few issues and company is planning to address those
  3. Good demand for products and capex is underway

Concerns

  1. Company has investments in equity, you can refer latest AR, they have around 1 to 1.5 CR equity investments.
  2. I couldn’t find credit rating report for this

I’m just tracking it for now, no holdings

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I have a question on valuations here - yes the new capacity would be added and revenues can go up accordingly but how much of it is in the price, some thoughts around it:

  • Last year it has stayed between 6-8PE
  • End usage is metals ie Aluminium, how will this company be valued in future: as a chemical or speciality chemical or a metals company
    What PE should be assigned for future?
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Has anyone looked at CFO, why is direct tax number zero between 2009-2016, while there is provision for taxes in all these years:

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There margins have been subdued due to raw material issues, partly which can be resolved with capex done by fertiliser plants like Coromandal. With increased capacity of Fertiliser plants, Alufluoride can get one of the Raw material at cheaper rate

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Anyone with AGM notes, updates?
Thank you

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Promoter holding up from 53.08% to 59.29% in last 3 years

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535f88d4-4f6d-4b6c-8948-477d57f2c62d.pdf (643.5 KB)

Commercial production at the new expanded plant could not be commenced from 19th December.

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Hi all

Any hints on why the price almost doubled during the last 2 weeks.

There has been the filing for Formation of a new Company in Dubai

Also company replied to the clarification last week https://www.bseindia.com/xml-data/corpfiling/AttachLive/f918d11a-10a5-47cd-b497-fb49863efa19.pdf

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I reckon the price is appreciating because of the news that Indian railways will make the coaches from Aluminum. NALCO has got a big order and it’s a client of Alufluoride.

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c0f63c45-a133-4aca-b0ca-1a547068e4d3.pdf (560.3 KB) - This could be another reason apart from the new factory starting successful operations

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Is there a way to find the list of clients for AluFluoride? I know NALCO is a client.
Also what kind of contracts does AluFluoride have with their clients? Are they long term contracts? Short term contracts?