Panasonic Energy India Company 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.
Panasonic Energy India Co. Ltd., established in the year 1972 as Lakhanpal National Limited, is one of India’s largest manufacturer & supplier of dry cell batteries and lighting products. Headquartered in Vadodara (Gujarat), the Company is a part of global Panasonic Corporation, world’s leading manufacturer of audio-visual equipments, home appliances, electronic components, automotive electronics and environmental systems. .
The Company is a leading manufacturer and supplier of Zinc carbon, Alkaline, Lithium, Rechargeable batteries and lighting products.
Screener URL: http://www.screener.in/company/504093
CMP: 170.00
Warren Buffett Checklist
| History of Consistently Increasing Sales, Earnings & Cash Flow | Yes. |  |
| Durable Competitive Advantage | Good Brand. Innovations. But, as the company is into battery business – I cannot expect good growth over there. |  |
| Future Growth Drivers | Looks moderate. Company should come up with more innovative products. (From the web site i can see only torches, batteries & rechargeable batteries) |  |
| Conservative Debt (long term debt < 3 Net Profit) | Good. | |
| Debt Equity Ratio | 0 – very good. | |
| Return on Equity must be Above Average | 10% which is less than required 15% | |
| Low CAPEX required to maintain current operations | Yes. | |
| Management is holding / buying the stock | 58% is static holding for past 3 years. | |
| Price is Under Valued (< intrinsic value) | Yes. | |
| Stock Price is consolidating (now) | Not. Price at peak of 500% from lows. | |
| Stock Price is growing in past years along with EPS growth | Yes. | |
Additional Futurecaps Checklist
| Consolidated PE, PB Ratio | PE 11 (moderate); PB 1.7 (good) | |
| Cash Flow Positive, Net Profit % greater than 8% | Cash flow is positive. NP% above 8%. | |
| Paying Dividends, Tax | Yes. | |
| EPS Growth Rate | 40% above on average. | |
| Latest Quarter EPS Growth | 500% – q-o-q Extreme | |
| Expected Gain in 5 Years | 10X in 5 years. | |
| Price Movement Graph, 52 Week High & Low | 500% appreciated already. | |
| Volume Analysis | Volume is too low for a reputed brand. | |
| Power of Brand | Yes. | |
| Corporate Governance, Reputation of Leaders | Good. | |
| Fraud reported | Not. | |
Declaration
Considering the red-factors, I declare it as a high-risk multibagger. You should do your due-diligence more before taking position in the company.
Considering the current projects, I can definitely say it is not a long-term multibagger. May be a good hold till next 2 years (end of bull run).
Allocation
2-3% 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.
