Stock Review: LALBHAI GROUP

LALBHAI GROUP 's chemicals manufacturer Atul has been on a steady growth path with expansion of product portfolio and a gradual increase in capacities. In the last three years, its profits grew at cumulative annualised growth rate (CAGR) of 35%, while sales grew at 14%. This indicates that the company's efforts at improving margins have borne fruit. The company is aiming to grow revenues by a third in FY12 and FY13 without any inorganic growth plans. The company has systematically improved its return ratios over the last five years. The return on total employed capital has jumped to 22.6% in FY11 from just 9.9% in FY07. Its debt-equity ratio too has improved in the same period with a consistent record of steady cash flows and annual dividends