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Thursday, September 02, 2010

Gujarat Ambuja Exports: Annual Report Review.

Gujarat Ambuja Exports has published its annual report and is available in BSE website (Link) here are some of the salient points.

1. Agro Processing unit underperformed by 53.34% crushing only 166119MT (2009-2010) as compared to 356027MT in 2008-2009. Drop in crushing capacity was due to lack of price parity between raw material and finished products..
GAEL however met its export commitments by trading in these commodities.
GAEL management is confident of better days and has infact setup new Solvent extraction plant in Mandsour in state of Madhya Pradesh.

2. Cotton yarn division reported profits. GAEL has debonded the units from being Export oriented units (EOU) this will reduce paper work required to sell yarn in local markets.Company has also installed additional 8400 spindles which will commence production in 2nd half of the year.

3. Maize Processing division did very well and had 59% growth in topline and 88% growth in bottomline. GAEL has 2 maize processing plants one each in Gujarat and Uttrakhand. GAEL expects growth in this segment also and is going to setup a new plant in State of Karnataka. (Andhra Pradesh and Karnataka are the 2 largest maize producing states in India) The plant in Karnataka will be a state of the art manufacturing plant manufacturing derivatives and value added products of Maize and will cost 100Cr. production will start from new plant from next financial year.

4. Company has added one more windmill of 1.5 Mega Watt capacity in Sept 2009. Total Windmill capacity is now 8.45 MW. Carbon credits are very important source of revenue in windmills and GAEL is working towards getting carbon credit for its windmill division.

5. Long Term debt is only 13.83Cr Book Value is 30.39 Working capital loan is 164.35Cr
6. Company has cash equivalents of 28.16Cr and quoted investments worth 40.47Cr

Conclusion: See huge value in GAEL and expect the stock to outperform the index.


Purushottam said...

hi i liked the analysis of Gujarat Ambuja...

Did you had a Look into Aditya Birla Chemicals ltd..

It has debt/equity Ratio of 0.17.

It has a Maximum shareholding from Hindalco.

Profits are consistently increasing from 2006 till 2010..
P/e is also less.
ROE is 22%

Consistent Dividend Payout Company..

What'sUp Prahalad said...


Adiya Birla Chemicals Limited looks to be a good bet but then
Topline 243Cr
PBDIT: 94.84Cr

something seems wrong here.. but then its from the Aditya Birla Group so management issues is out of question..

All said and done it sure looks to be a good bet for the long term .. worth accumulating if we can get it at lower levels..

Do you have any idea:
1. Why the bottomline is growing while topline is not growing (in proportion)
2. Is there something new? also since its in related industry to hindalco?..

Thanks for sharing the stock idea

=happy investing

Anonymous said...

Dear WhatsUp, Do you know anything about the EsVee group, promoted by Vijay kumar Gupta, MD of GAEL? Is there a Land bank story for GAEL, which can unlock its value apart from its regular business?? I have read some stories by doing Google search...

The Ahmedabad-based EsVee Group, promoted by Mr Vijay Kumar Gupta, Chairman and Managing Director of Gujarat Ambuja Exports Ltd (GAEL), plans to develop exclusive townships across India. The first of these chain-townships, at Mysore, is scheduled to be completed by 2010, on a 60-acre plot situated 1.5 km from the airport. The township, christened `Highlands’, would offer250 residential flats of three to five bedrooms and 150 villas – all fully furnished and air-conditioned.

Thanks and regards,

Anonymous said...

contd..here is another link

GAEL had earlier floated an entity, the Esvee Group, to enter into new areas of businesses. GAEL was to take up a few township projects in various cities, including Ludhiana, Amritsar and Chandigarh in Punjab, Surat and Vadodara in Gujarat, Hubli and Mangalore in Karnataka, Nasik and Pune in Maharashtra, Kochi in Kerala and Tamil Nadu's Coimbatore.

What'sUp Prahalad said...


Yes I did hear about the additional maize capacity..

Maize Capacity was for ethanol blending with motor fuel (petrol)
and has been dropped .. (though there seem to be pvt owned companies in Maize related derivatives.. in maharashtra)

Property business is also something I had heard about but donot have any idea.. the company had about 32.9Cr worth of land in 2002 right now it stands at 13.80Cr

I must clarify that 32.9Cr has not been differentiated into lease holding and Free Holding land in 2002

In 2010 13.8Cr has been differentiated into Lease 8.89Cr Free holding: 4.9Cr

I know this info really does'nt provide any clarity to your question.. The thing is I donot have any idea about GAEL entering into property development .. or land bank deal.

I would say entry into property development is a nagative cause you waste a lot of energy and one should stick to their area of expertise..

I am sure GAEL promoters must be having a number of other private ventures.. but GAEL has over time accumulated a lot of reserves and seems to be ripe for plucking..

Well there is always the element of the unknown .. I hope I have all my bases covered.. (keeping my fingers crossed..)

=happy investing

Anonymous said...

Thanks very much for your valuable comments. regards