Hi, I like to start a thread for this company which I just started to study.
About the company
Rama Vision Limited (RVL) was incorporated in India in 1989, with the object of producing B/W television picture Tubes in India, in line with the national policy of the Government of India.
In the year 2002, The Company became an importer and distributor of Baby and Mother care products, Skin care products, Food products, etc. across India.
Some Big Brands they trade as of today
The company deals in brands like
- Pigeon (Japanese Brand) where they are promoting this product in the Northern part of India,
- Graco - a name famous for Strollers, Travel Systems, High Chairs, Car Seats, and Swings suitable for Children ranging between birth to 3 years,
- Thailand Brands like Real Thai, Raavi,
- And others like Mustela, Mothercare, Nuby, Kimball, Pepsodent, Trisa, Baby Dove, Suave Kids, Delight Nuts, Graco, Nongshim, Hellmann, etc…
These are some well-known Brand names in the world.
The Company has a network of 235 distributors across India. The company’s sales network caters through its depots in Delhi, Maharashtra,
West Bengal and Uttar Pradesh.
Growth Drivers
- They are doing a massive capex of almost 15.49 crores (the Companies Market Cap is just 38Cr) which is almost 45% of their Market Cap. They are putting a plant in Uttarakhand, for manufacturing wafer sticks in Himalayan Mega Food Park and they are getting a grant-in-aid of 4.75 crores from the government. It will come with an installed capacity of 900MT.
The company expects the unit to commence by the 1st of April,2024.
- They are trading at 0.5 times their sales
- In the last three years, sales have grown by 24%, and PAT at 130%.
- Though they have a thin margin of 3.65% in 2020, which they have grown to 5.65% in 2023 which is a growth of 200 Bps in 4 years and I expect them to grow in the coming years too.
- Promoters Holdings is more than 52% and keep on increasing their stake by QoQ.
Wafer Sticks Market
- Indian Snacks market is 38,603 Crore as of FY22. (India Snacks Market Size, Share, Growth & Forecast 2023-2028).
- Global Wafer market is $ 107 billion and is expected to grow at 4.1% CAGR.
Immediate Trigger for this stock
The upcoming commissioning of the plant in a year with a 900MT of capacity.
Risk
- How will they improve these margins from here on is the key?
- Though it is a company with a Market Cap of about 38Cr, it has borrowings of 9.74 Crore, which takes the Debt to Equity of 0.43% (Though it is reasonable, it is still high to me) and also they are going to do a big capex which will also add to it.
No Recommendation but Invested at the price of Rs. 38.