Alkyl Amines can touch Rs 200, says SP Tulsian, sptulsian.com.
Tulsian told CNBC-TV18, "Alkyl Amines Chemicals is making amines and amine based chemicals, which are used in pharmaceutical, agro-chemical, water treatment, leather chemical processing plus many other uses also.”
He further added, “The company has posted good results for Q3. If I go by their first nine months working for whole of FY13, which has practically surpassed the FY12 on the EBITDA as well as on the PAT front. PAT has been Rs 20 crore for first nine months, while the PAT for whole of FY12 was at about Rs 17-17.50 crore. EPS for first nine months is at sub Rs 20, while for whole of FY12 it was sub Rs 17.”
“If I go by the EBITDA also, the EBITDA margin has slightly improved because EBITDA of Rs 44 crore for first nine months on the topline of close to Rs 275 crore against Rs 42 crore EBITDA for FY12 on the topline of close to about Rs 295 crore also is showing that the company is improving their margin.”
“If you go by the promoter’s 74 percent stake and considering the user industries’ demand for amines and amine based chemicals mainly into the pharmaceutical and agrochemicals, the water treatment and the leather processing takes a small share, they are all growing quite well and the demand for the products of the company is likely to improve in the time to come.”
“So taking all this into consideration, again stock looks quite good because for FY13, company should be able to post an EPS of close to Rs 28-29 and going forward FY14 may see an EPS of Rs 35-36. So, this chemical company on forward earnings is available at a sub-P/E of less than Rs 5. One can expect a price of about Rs 200 in a longer time horizon of about one year or so.”
Disclosure: I have no holdings in the stock discussed.