While finalizing Hidden Gem stock of the month from chemical industry, our team has followed Walter Schloss priniciple's. Walter J. Schloss (August 28, 1916 – February 19, 2012) was a well-regarded value investor, as well as a notable disciple of the Benjamin Graham school of investing.
2. Company possesses a highly experienced team of professionals and holds significant experience in various industries including FMCG, Food, Paper, Pharmaceuticals, Plastics and Printing etc. Its clients include large domestic and international players like Asian paints, Dabur, Colgate, ITC, Unilever, Wipro, Ranbaxy etc. Long term engagements with a majority of these esteem clients emphasize strong uninterrupted profitable business operations for the company.
3. Company has posted good consistent profit growth of 26.8% over last 5 years. Company has achieved compounded sales growth of 23.2% and ROE (return on equity) is 18% over last 5 years. Moreover, Management has rewarded share holders by paying regular and uninterrupted dividends since last many years, dividend yield at current market price is above 1.
4. Promoters share holding is well above 70%. Moreover, promoters have increased their share holding significantly doing open market purchases during last one year. Looking at bright future prospects of the company, we believe that promoters will continue to increase their stake in the company to achieve maximum shareholding of 75%.
5. In terms of valuation, company is trading at estimated PE ratio of 4.9 for FY 2014-15. Considering increase in revenues with commencement of new facilities and better operating margins with increase in global demand for company's products, it offers good investment opportunity for medium to long term investors.
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