KRBL Ltd. – Multibagger Analysis

KRBL Ltd. – Multibagger Analysis

KRBL is the company famous for Basmati Rice brand India Gate.With a 120 year heritage and an existence since 1889, KRBL Ltd. is India’s first integrated rice company with a comprehensive product chain.

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Company web site: http://www.krblrice.com/

Analysis link: http://www.screener.in/company/?q=530813&con=1

Warren Buffett Checklist

History of Consistently Increasing Sales, Earnings & Cash Flow Yes. image
Durable Competitive Advantage

Yes. Through power of brand.

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Future Growth Drivers Export Boost through new governance laws. Plus, company focusing on seed-research, tie up with retail chain market in India and abroad should boost future income. image
Conservative Debt (long term debt < 3 Net Profit) Debt stands around 344 crore & Latest Net Profit at 255 crore.  Sure to cover enough by 3x. image
Return on Equity must be Above Average 17% is the ROE which is above 15% average image
Low CAPEX required to maintain current operations Moderate capex cash flow visible image
Management is holding / buying the stock Promoter Holding is impressive at 58% & No buying or selling visible. image
Price is Under Valued (< intrinsic value) Yes. image
Stock Price is consolidating (now) Yes. image
Stock Price is growing in past years along with EPS growth Yes.  But not too impressive image

Additional Futurecaps Checklist

PE, PB Ratio PE at 8 and PB at 2 which are very good in current boost market. image
Cash Flow Positive, Net Profit % greater than 8% Yes. image
Paying Dividends, Tax Yes.   image
EPS Growth Rate Latest growth 100%; Average growth 30%.  image
Expected Gain in 10 Years 4-5 times.  image
Power of Brand Branding attracts more sales, more profit margins!  image
Corporate Governance, Reputation of Leaders Pass  image
Fraud reported Nil image

 Declaration

Here by we declare that KRBL is a potential multibagger positioned at right price.

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Allocation

2-3% of total 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.

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