NSE News - Latest Corporate Announcements

Monday, April 23, 2012

Jayant Agro: Castor Crop Survey-SEA & Jayant estimated earnings Year 2011-12

Looks like there has been a huge increase in cultivation of Castor in India. As per Solvent Extractors Association (SEA) of India.

=   Total area under Castor crop in India for the year 2011-12 is 11.50 lakh hectares. It has increased by 34% as compared to previous year.

=    Estimated total production of Castor Seeds in India for the year 2011-12 is 16.19 lakh tonnes.  It has increased by 30% as compared to previous year.

Average yield for the year 2011-12 is 1417 kg/hectare as against 1453 kg/hectare during the year 2010-11.  It has decreased by 3% as compared to previous year.

Export numbers have also increased by 60% .. so we can expect Jayant also to report higher earnings for the year ended March 31,2012.

Jayant has reported for 9 months ended dec2011.(Year on Year)Sales increase: 62%  PBDIT Profit margin of 5.05%Net Profit margin of 1.83%

Assuming Jayant Agro maintains the same profit margins as reported for 9 months ended Dec 2011we can expect Jayant Agro Expected year ending March 2012:-Sales:1,875.20crPBDIT: 94.69crNet Profit: 34.31cr EPS: 22.87

Please Note for year ending March 2011 Profit margins were
PBDIT : 5.41%
Net Profit: 2.10%

Assuming Jayant maintains the same margin as march 2011..(higher than margins for 9 months ended dec 2011) these margins would result in :- 
- PBDIT:  101.44cr
- Net Profit: 39.37cr
- EPS: 26.25

Now we all know that Sebacic acid derivatives plant has started production from dec 2011 so we can expect margins to improve for 3 months data..

My guess estimate for Year ending March 2012 Net Profit numbers:
Poor Result would be below 31Cr EPS: 20.66
Fair result would be: 34.31cr EPS: 22.87
Great result would be: 39cr,  EPS: 26 or above

A     whatever the result .. we can expect the dividend payout to increase based on historical figures..  
        dividend payout as percentage of net profit (Including dividend tax):
          March 2011: 13.40%
          March 2010: 23.33%
          March 2009: 36.18%
          March 2008: 25.65%
          So even assuming 5 yrs avg of 19.71% and assuming worst case result of 31Cr Net Profit: Dividend payout will be rs 4.07 per share assuming 34-39cr as net profit dividend payout could be: 4.46 - 5.12 assuming 13.4% for net profit of 31cr we can expect dividend of 2.76 (Poor payout) 
           Conclusion: Jayant is a strong value buy! For year ending March 2012 we can expect Jayant Agro to report:
            Topline of 1875cr 
            Net Profit from 30cr to 39cr, 
            EPS of 20-26 per share and 
            Dividend payout from Rs 2.76 to 5.12 per share (before dividend tax)

       PN: this is my personal view based on publicly available information. please do your own deep dive before investing


ttthakur said...

I am a frequent reader of your great blog. Thanks for your excellent analysis and peak oil theory.

Sir, I have received recommendation for following 3 stocks:
1) National Peroxide
2) Wim Plast.
3) Omkar Speciality Chem( 53317) -Ronie Screwala of UTV has taken stake in this co.

Kindly analyses them whenever you find some spare time.
Thanks and Regards,

What'sUp Prahalad said...

TTThakur ji:

Of the 3 stocks I like National Peroxide the most..

there are 2 more companies.. that are producing hydrogen peroxide..
- Asian Peroxide
- Gujarat Alkalies chemicals

I like gujarat alkalies also..

National peroxide I would buy if it closes above 424 for 2 weeks consistently.. looks like there is some more downside..

at around 250 levels national peroxide is a great deal..

=happy investing

Anonymous said...

I was looking at National Peroxide phenomenal rise in profits & EPS for year ending March 2011.

Found in consolidated results in notes:

The operating Profit for the year under review is significantly higher than the corresponding previous year as a result of higher market prices of Hydrogen Peroxide. There was a plant shutdown in May 2009 for 24 days for maintenance and replacement of catalyst. The non operational other Income includes a dividend of Rs. l33.88 lacs received from our subsidiary Naperol Investments Ltd., which is non recurring. The results of the current year are therefore not comparable to those of the corresponding previous year.

What'sUp Prahalad said...

Anonymous ji:

the hydrogen peroxide production process is closely guarded and in the hands of a few multinational companies..

National peroxide has 25% stake by solvay .. and thus national peroxide has access to latest technology..

.. You should also look at gujarat alkalies which looks to be a much more diversified company..

=happy investing

Anonymous said...


do u hv a facebook page?

What'sUp Prahalad said...

Anonymous ji:

No I donot have a facebook page where I share investment ideas..

why do you ask?

=happy investing

Anonymous said...


Just for curiosity.......Are you a professional financial advisor( I mean Working any broking firm )or Stock reserch doing just for passion ?How many hrs you normally spending daily for reserch work !!!! Just amazing your readings !!!

What'sUp Prahalad said...

Anonymous ji:

I am an individual investor .. and I am not a financial adviser or donot work with any broking firm..

Just that I like what I am doing..

I do manage some money for family ..

=happy investing

ttthakur said...

Thanks very much for your valued comments on National Peroxide. Also for pointing out Guj Alkalies.
Sir, do you also follow Technical Analysis as you have said NP shud close above 424 for 2 weeks consistently and at 250 NP is a great deal.
Looking forward to your valuable comments.
Thanks and Regards,

ttthakur said...

The basic premise behind your strong recommendations for 4 stocks viz.Jayant Agro, GujAmbuja Exports, NHPC and Tata Communications, is Peak Oil Theory.
In this connection, from what i read what people like Ruchir Sharma of Morgan Stanely says:the current mania for oil echoes the dotcom mania of 2000 besides once Iraq becomes stable and peaceful country, it shall produce lot of oil, being the owner world's 2nd biggest oil reserves and latest shale gas technology besides Solar and Wind technologies making up for the lost time, it seems Peak Oil Theory may just remain in Theory.
In light of the above, kindly let your keen followers like me, know your thoughts.
Thanks and Regards

What'sUp Prahalad said...

TTThakur ji:

I donot do any technical analysis..

What I did use for this conclusion was EMA (Exponential moving avg) 50,100,200 days..

candle sticks info for individual stocks is available (DAILY & WEEKLY ) <-- chk both for "BUY" /Sell signal

at hindustanbulls:

=happy investing

What'sUp Prahalad said...

TTThakur ji:

peak oil is not like "dot com" mania

oil prices might fall but the direction is up.. Once it crosses 150 USD/barrel levels we will see serious contraction in demand..

Oil is energy and energy is wealth!!.. no matter how much more oil is drilled/discovered demand is rising exponentially specially when countries like India and China with huge populations want to reach a higher std of living..

US has population of 350 million while India and china total have a population of 2.x billion+

even if we reach 1/10 the energy demand of US std.. we will double worldwide energy requirements..

Look at this info:
Saudi is going to reduce export of raw crude and increase exports of refined products..petrol/diesel/PET .
- India has agreed to allow import of this processed fuel when India already has excess refining capacity (around 220 million)
- recently Oman-india urea plant has increased its gas price from 75cents to 3USD and India agreed to it even though the original agreement was fixed at 75 cents for 15yrs starting 2005.

- price of reliance stock..
- Royal dutch Shell..has put for sale its refineries in Europe to essar?

You can also see subtle changes that nowdays bollywood is getting into TV serials.. (less energy intensive..)

Other indicators are:-
- govt has said annual reports will be sent by email no physical delivery
- Management meetings AGM can be done over the phone..
- Dividend payments .. mutual fund all turning to electronic mode...
- AC Busses to woo the middle class from pvt vehicles to public transportation system..

The govt. wants an orderly move-out of oil dependent economy..

The Indian govt Interest rate hike was to curb demand.. and maybe thus impact inflation..

In US the equity collapse happened as the baby boomers (largest middle class with wealth) were just going to start retiring .. (retirement would mean large scale selling of assets (equity and housing))

the financial collapse happened just before the baby boomers could cash out in mass..

So things are never what they seem.. and the underlying reason is shocking to say the least..

an Intellectual was asked what do you feel about "Women's Liberation"

The Intellectual answered what he knew:- "Its about equal rights to women.." Right to Vote, Right to Work, Right to Choose"

Mr X said.. Actually that's all for public consumption..

Women were working taking care of their homes.. cooking and looking after their famlies... All this was real work but it was not under the "Tax" net..

With Women's Liberation 50% of the world's population entered into the tax net.. Families are still doing the same things but now everything is taxed. Women work..(and pay taxes) and they employ workers or assistance for their home work.. "eat out/Cleaners/Machines/creche" all these are services are also taxed..

"Peak oil" is real .. but if disclosed general public will panic .. the move out of oil will be "Rapid" and haphazard..

The idea is to do a controlled move out in the name of "Environment Protection" "Green House Gas Reduction" and love for nature.. So is my understanding..

=happy investing

Purushottam said...

Peak is Real.. And i agree

All info below is from wealth Daily:

New information reveals Saudi Arabia is building oil reserves during its slack demand months.

Goldman Sachs cited a crude oil inventory build of 35.4 million barrels in the period December-February, based on numbers from the Joint Organizations Data Initiative (JODI).

This oil stayed in Saudi Arabia and wasn't exported.

Goldman said this was “in an anticipation of a substantial increase in demand that cannot be covered by simply raising production levels.”

The Kingdom is stockpiling 390,000 barrels per day — not as a guard against Iran sanctions, but rather as insurance against peak energy demand, which happens during their hot summers.

In the past, Saudi Arabia would simply increase production.

Stockpiling would indicate they cannot.

And right now, the global oil market is extremely tight — even with the return of Libyan crude and the slowdown of economies in China and Europe.

If the Saudis are at the point of lower production, oil is going to get a lot more expensive...

Saudis Lie

No one country can make up for the shortfall.

It's only a matter of time before the spare capacity is gone.

The Sheiks continue to claim they have total capacity of 12.5 million barrels a day. There is no evidence behind this.

Saudi crude production cannot be sustained over 10.5 million barrels a day. In November 2011 production reached the highest level in 30 years, hitting 10.047 million bpd.

Since then, it has hovered just below the 10 million bpd mark.

$9 Gas

The Wall Street Journal tracks political ads every week.

The No. 1 ad last moth was “$9 Gas.” It came from American Energy Alliance and attacks President Barack Obama on his energy record.

What'sUp Prahalad said...

Purushottam ji:

yes the additional problem is the quality of crude is sour and that will require additional investment in old refineries built to process light crude..
Oil companies are aware of dwindling supply and donot want to acquire additional machinery to upgrade as they might not be able to utilize the capacity fully..

So not only is supply tight processing capacity for sour crude is less.. further limiting supply

One reason I am looking forward to zero growth..

=happy investing