Bhageria Dye-Chem Ltd. – Multibagger Analysis
Update: This stock really is Not a Multibagger up to date. Since the Valuation change it is No Longer a Multibagger in our view. You can check other stocks from our latest Multibaggers pack.
https://futurecaps.com/tag/multibagger/
Futurecaps is a SEBI Registered Research Analyst providing Multibagger service to Indian Stock Market.
BHAGERIA DYE CHEM LIMITED was established in 1989 with an objective to serve the dyes & intermediates industry all over the globe. Company commenced its operations by setting up a Vinyl Sulphone Plant at Vapi (Gujarat) with capacity of 540 T.P.A. which has now expanded to 3600 T.P.A. Subsequently Company has gone for further expansion in other Dyes intermediates & Dyestuffs.
The company successfully incorporates the innovative trends, total quality management and proficiency in work process through advanced research and analysis.
Company URL: http://www.bhageriagroup.com/
Screener URL: http://www.screener.in/company/530803
CMP: 203
Warren Buffett Checklist
| History of Consistently Increasing Sales, Earnings & Cash Flow | Yes. |  |
| Durable Competitive Advantage | Company have good export-exposure, but cannot find a solid point on this. |  |
| Future Growth Drivers | Future for next 2 years looks good. | |
| Conservative Debt (long term debt < 3 Net Profit) | Good. | |
| Debt Equity Ratio | At 1.16 which is high for this sector. | |
| Return on Equity must be Above Average | 52% which is extremely high, should cool down. | |
| Low CAPEX required to maintain current operations | Moderate. | |
| Management is holding / buying the stock | There is a rise & fall in holdings for past 3 years. | |
| Price is Under Valued (< intrinsic value) | Considering EPS growth of 30% above, the stock is undervalue in Intrinsic Value. | |
| Stock Price is consolidating (now) | Company witnessed 10 times growth in current year. Be watchful. |  |
| Stock Price is growing in past years along with EPS growth | Yes. But only in past 1-2 years; before that company was under loss. | |
Additional Futurecaps Checklist
| Consolidated PE, PB Ratio | PE 5 (good); PB 4 (high) | |
| Cash Flow Positive, Net Profit % greater than 8% | NP% comes around 7%. | |
| Paying Dividends, Tax | Yes. | |
| EPS Growth Rate | 40% | |
| Latest Quarter EPS Growth | 1000% for q-o-q | |
| Expected Gain in 5 Years | I keep 30% as EPS growth for extreme growth stories. Considering 30% EPS growth & PE resizing to 10 on industry average, 5 year returns could be 5X-10X. | |
| Price Movement Graph, 52 Week High & Low | 52wh is high compared with 52wl. | |
| Volume Analysis | Very low volume; Could be the reason prices fired up quickly. | |
| Power of Brand | Good. | |
| Corporate Governance, Reputation of Leaders | Good. | |
| Fraud reported | Not. | |
Declaration
Company is having Multibagger properties. But, viewing the 1000% spike on recent, I recommend to be cautious with this stock.
Allocation
1% to 2% of your portfolio.
Disclaimer
Futurecaps recommends 20 to 25 multibaggers per year, we recommend a 25% to 50% allocation of your savings in equity. The stocks recommended here are gone through Analysts of several years experience in stock market. Although they were successful in predicting future multibaggers, the overall stock market is a risky game. So we recommend the reader to put his/her own thoughts & invest wisely.
