Stock Views on Insecticides India, IFB INDUSTRIES, FDC, RICOH INDIA

FDC

FDC (Foods, Drugs & Chemicals) is a player in oral rehydration salts, opthalmics and paediatrics. It earns over 90% of its revenues from the domestic market. It has launched products in various therapeutic areas and has opned commissioned a novel drug delivery research laboratory to focus on research in areas like anti-infectives, respiratory and anti-inflammatory agents. It generates a positive cash flow and has a strong balance sheet. Its revenues and profits have doubled in the past five fiscal years. Valued at over three times its sales, the company's stock is commanding fair valuations on the bourses. The company has announced a buyback of up to 9.8% of its equity and free reserves at a price not exceeding 135.

 

IFB INDUSTRIES

IFB Industries is a consumer goods company. It's more profitable engineering segment contributes nearly 20% to its total revenues. Its home appliances business of washing machines, dryers, microwave ovens and dishwashers is steadily gaining momentum in revenues and profits. A strong brand equity, high product quality and latest technical know-how are its strengths. The 650-crore company is investing into modernising and expanding its capacities in appliances and engineering segments. Due to this, the appliances division is expected to achieve a 20% growth in sales and sales of the engineering division are likely to double by the end of FY12. At a market cap of 377 crore, the company is valued at a little over half its sales.

 

 

INSECTICIDES INDIA

Insecticides India (IIL) is an agro-chemicals and pesticides company. It has posted a robust growth in its financials. In the past seven quarters, its operating profit margin has been in the range of 8-10%. It may continue operating at similar margin level in future. This fiscal, IIL expects an annual turnover of 550 crore, nearly 40% growth. This implies an almost 50% sequential growth in the March 2010 quarter topline to 135 crore on the back of the opeing of its units in Udhampur and Dahej. IIL's production capacity of technical grade pesticides is expected to go up by six times to 12,000 tpa. It also expects to expand its reach in the southern India and intends to develop its exports market in the next 2-3 years.

 

RICOH INDIA

Ricoh India makes photocopiers, fax machines, printers and other digital multifunction products. Its revenues have been growing at a very slow pace since FY05. It plans to expand its portfolio, geographic footprint and business areas. It has earmarked 100 crore for organic expansion and is also increasing its man power to 1,000 by September 2011. It is also eyeing acquisitions in the IT services space. Even without any acquisition, the company intends to treble the revenues to 1,000 crore by FY13. The company has zero debt and is generating positive cash flows. It has better financials than its listed peers. It is valued at less than half of its revenues of the past four quarters. As its financial performance improves, its valuations are likely to increase.