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Tuesday, June 29, 2010

Diamines & Chemical: Divident Stripping: Value Buy


Diamines & Chemicals:
CMP: 60.50
Market Cap: 39.46Cr
Sales March 2010: 54.10Cr
Debt: 17.49Cr (March 2009)
Reserves 14.49Cr
ROCE: 20.22%
Debt Equity: 1.33
Long Term Debt Equity: 0.63
Divident Rs 2: Ex- Divident date: July 7,2010 <<==(Changed from July 8 to July 7)

Diamines & Chemicals is the only Ethylene Amine business in India. AlkylAmines Chemicals has a controlling stake in Diamines Chemicals. Alkyl amines is the worlds leading provider of pharmaceutical grade aminehydrochlorides. Diamines & Chemicals is focussed on Piperazine. Ethyleneamines are used in pharmaceuticals, agrochemicals, lubricants, fuel additives etc.

Conclusion:
Diamines & Chemicals has reported for the year ending March 2010 a 269% increase in operating profits. There was a one time 8Cr other income related to written back old credit balances. The company operating margins are above 20% which is really good. The negatives are higher debt to equity ratio and reserves of just 14.49Cr (9.66Cr last year). There is also a possibility that the profits could be depressed in the future as Alkylamines is related upstream company. Right now the 3% divident return in 1 week along with good profit margin of more than 20%  are the positives for investment return of 10% or more in one month. Short term Buy!!
PN: these are my personal views please do your own deep dive before investing.

3 comments:

Anonymous said...

Dear Sir

wat'z ur opinion on Rishabhdev technocable ltd?

What'sUp Prahalad said...

Anonymous ji:

Rishabhdev Technocable:
CMP: 8.21 (Face Value 10)
Market Cap: 21.91Cr
Sales March 2010: 70.97Cr
Operating Profit 5.33Cr
Net Profit 2.33Cr
ROCE: 9.14%
Debt 17.11Cr
Equity: 26.69Cr (Equity March 2009: 5.69Cr)

Rishabh Technocable has increased its equity from 5.69Cr in March 2009 to 26.69Cr in March 2010 ie 500% increase..

Conclusion: Company is small compared to other cable manufacturers.. (universal cables) also with a 5 times equity dilution the stock might languish due to excessive liquidity..

I would recommend an avoid.


=happy investing
whatsup-indianstockideas.blogspot.com

Anonymous said...

Hi

I'm planning to invest in FCS Software and Resurgere mines and minerals.Please advice me at which level i can enter into these stocks and wat will be the price target in 3 year perspective