Monday 8 September 2014

Gujarat Ambuja Exports - worth having in portfolio

Company Profile

Gujarat Ambuja Exports Limited is engaged in manufacturing and exports of agro based products. The Company’s product profile includes solvent extraction comprising of oil seed processing, edible oil refining, cotton yarn spinning, maize based starch and its derivatives, wheat processing, cattle feed and power generation through wind mills, bio gas and thermal power plants..The Company operates in four segments:
  • Agro Processing
  • Cotton Yarn
  • Maize processing and
  • Windmill.
The Agro Processing segment consists of solvent extraction of edible oilseed, edible oil refining, de oiled cakes, wheat processing and cattle feed manufacturing.

Financials
Yearly Results

FY10FY11FY12FY13
Sales1408.561949.432114.093004.62
Operating Profit111.35153.89105.76194.57
 Profit Before Tax77.05115.5560.52145.64
 Net profit60.0294.1049.70113.35
 EPS4.346.803.598.19

Gjarat Ambuja Exports Limited’s business model generates low margins but high turnover. Even then, the company’s margins are improving gradually over the years- currently stands around 6%. Total Revenues in current fiscal year is expected to increase 30%. Due to windmill power generation and improvement of capacity utilization company is able to improve on margin front which is likely to improve further.
Promotor’s have recently increased their stake to 71.96%

With consitent player and improvement, the stock looks attractive for long term players. Investor with steady returns can invest in the stock for the target of 84.

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