I was trying to study Nath bio-genes.
Link to AR 2018: https://www.bseindia.com/bseplus/AnnualReport/537291/5372910318.pdf
AR 2018 notes:
Cotton : The products like King 101, NBC 102 and NBC
1022 have displayed excellent results
Others: Maize, Wheat, Jowar etc. each crop has a potential to be a chart buster. And each has minor contribution only. Notes are same as AR 2017
Rice: We expect to grow higher than industry for hybrid, backed by our strong product portfolio. We also are enhancing our presence in the OP segment.
Veg seeds: we expect strong growth in vegetable seeds in the years to come.
Plant Nutrition suppliment: (2017)Win-chi-win is a bio growth enhancer for cereals, vegetables crops, fruits, etc.
is a promising product and can gain market share. 2018: We plan to make this product a chart buster in the years to come.
Marketing: 2017 : was a formative year and the efforts of renewed marketing vigor should yield fruits in years to come
2018: the changes commenced to show results.
I think it is good to see company admitting weak marketing in the past and addressing them, if we review ARs.
R&D: 2017: Financial Year 2017 is a turning point as
most of the products on which the company has been working for all the years have started to yield results.
2018: FY 18 was a year in which the foundation for a long term sustainable growth was laid. developed a family of products across verticals of Cotton, Paddy, Mustard, Pearl Millet, Maize, Okra, Tomato, Gourds, Chilli and crop nutrition supplements. Your company also has a strong pipeline in each of the verticals for the next 3-4 year
We can see shift to newer areas like nutrition suppliment and Rice/Vegetable seeds over the years and I think they are yielding results
FY 18 was a year in which the foundation for a long term sustainable growth was laid. developed a family of products across verticals of Cotton, Paddy, Mustard, Pearl Millet, Maize, Okra, Tomato, Gourds, Chilli and crop nutrition supplements. Your company also has a strong pipeline in each of the verticals for the next 3-4 year
QIP: QIP in Jan 2018 to repay all long-term loans of the company and to strengthen the working capital requirement.
Revenue/Profit: increase in profits during the year under review was on account of enhanced sales, improved product mix and operational efficiencies. The revenues saw a reasonable upward trend of 12.82 %. The growth can be attributed to enhanced Cotton, Paddy, Vegetables and Win-Chi-Win sales. Cotton and Paddy continued to contribute around 20% and 40 % of the total sales. However, PNS segment contributed around 10% and the better margins in this segment resulted in better margins.
Inventory: The Inventory holding has been gradually reducing over the last 2-3 years.
Debtors: The company reduced the Cash Discount schemes at the year end, thereby enhancing
debtors but increasing the profit margin. Advances to production growers have also increased
over the year.
the trade payables have reduced in FY 18.
Disclosures: Have 2% of PF of a small size PF. Switched from JK Agri Genetics after Q1 results and AR reviews at approx 500 per share.
With Price to Book of 1.8 I think this has potential to re-rate when I compare to richly valued JK Agri genetics, especially when R&D of 8 years can yeild fruits with good marketing.
Profit/Sales Growth History:
Questions: How is company corporate governance and management quality ?
How this company can be compared to JK Agri genetics which I feel overvalued at P/B 4.72.
Being a relatively newbie, I want other aspects and risks associated with this company.
Inviting expert views.