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Panasonic Energy India Company Ltd. – Multibagger Analysis

Panasonic Energy India Company Ltd. – Multibagger Analysis

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.

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Company URL: https://panasonicenergy.in/

Screener URL: http://www.screener.in/company/504093

CMP: 170.00

Warren Buffett Checklist

History of Consistently Increasing Sales, Earnings & Cash FlowYes.image
Durable Competitive Advantage Good Brand.  Innovations.  But, as the company is into battery business – I cannot expect good growth over there.image
Future Growth DriversLooks moderate.  Company should come up with more innovative products.  (From the web site i can see only torches, batteries & rechargeable batteries)image
Conservative Debt (long term debt < 3 Net Profit)Good.image
Debt Equity Ratio0 – very good.image
Return on Equity must be Above Average10% which is less than required 15%image
Low CAPEX required to maintain current operationsYes.image
Management is holding / buying the stock58% is static holding for past 3 years.image
Price is Under Valued (< intrinsic value)Yes.image
Stock Price is consolidating (now)Not. Price at peak of 500% from lows.image
Stock Price is growing in past years along with EPS growthYes.image

 

Additional Futurecaps Checklist

Consolidated PE, PB RatioPE 11 (moderate); PB 1.7 (good)image
Cash Flow Positive, Net Profit % greater than 8%Cash flow is positive.  NP% above 8%.image
Paying Dividends, TaxYes.image
EPS Growth Rate40% above on average.image
Latest Quarter EPS Growth500% – q-o-q Extreme image
Expected Gain in 5 Years10X in 5 years. image
Price Movement Graph, 52 Week High & Low500% appreciated already.image
Volume AnalysisVolume is too low for a reputed brand.image
Power of BrandYes.image
Corporate Governance, Reputation of LeadersGood.image
Fraud reportedNot.image

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.

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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.

About Futurecaps

Futurecaps is a 12+ year experienced Indian Stock Market Advisory with SEBI Registration.

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