This article we can explore the possibility of Aries Agro Ltd as a Multibagger 2021 Stock based on Value Investing principles.
| Website | www.ariesagro.com |
| CMP | Rs. 165.00 |
About Aries Agro ltd
Aries Agro Ltd was founded by Dr. T. B. Mirchandani and Mrs. Bala Mirchandani in 1969.
The business of manufacturing of micronutrients and other customized nutritional products for plants and animals. It started the activity by manufacturing a small range of mineral feed additives for animals & birds and then diversified into mineral additives for the agriculture use.
In 1975, Company is diversified into nutrients for plants. It had in-house expertise in the area of mineral nutrition and hence conducted research on compounds that could deliver mineral nutrients to plants more efficiently. This research identified “Metal Chelates”. Through in-house R&D efforts, the Company branched out into Agrochemicals in 1975 with the introduction of Chelated Micronutrients. The company pioneered the concept of Chelates in India with the introduction of “Agromin”, a micronutrient fertilizer in the year 1975, followed by “Chelamin” in 1976. Agromin (chelated micronutrients) and Chelamin (chelated zinc) are the company’s flagship brands. It is one of the leading manufacturers and sellers of Chelates in the Country.
They conducted in-house R&D to develop bactericides for agriculture. Aries was amongst the first few to receive license for use of bactericides for agricultural use by the Govt. of India. This was then followed by the introduction of plant hormones.
This was then followed by the introduction of plant hormones. In 2001, Aries expanded its product line to include secondary nutrients – sulphur, magnesium and calcium. In the subsequent years, the company continued expanding the plant nutrition product line to include value-added, water-soluble complexes of nitrogen (N), phosphorous (P) and potassium (K).
Products and Services
- Micronutrients
- Plant Protection
- Aqua Culture & Animal Nutrition
- Urban Products
- Speciality Nutrients
- Water Soluble NPK
- Hydroponics and Consultancy
Profit & loss
Warren Buffett Checklist
| Factor | Outcome |
| Economic moat | Good |
| Growth | Good |
| Valuation | Good |
| Debt | Moderate |
| Integrity | Good |
Positives
- Company is in a growth sector
- Company is trading near book value
- It has good dividend yield
- It is reducing debt
- Have excellent R&D
- Celebrity Invested
Negatives
- Company have moderate debt of 103 Crores
- Company has a low return on equity of 10.93% for last 3 years.
- Contingent liabilities of Rs.83.84 Cr.
- Company’s cost of borrowing seems high
Summary
As per the Value Investing grounds the company have Multibagger Potential at current over-price valuation.
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