Excel Industries can move to Rs 100: SP Tulsian

Excel Industries can move to Rs 100 in next 12 months, says SP Tulsian of sptulsian.com.

Tulsian told CNBC-TV18, "Excel Industries has posted good result. They have been in agrochemical and agrochemical derivative business for the last 65-70 years and the financial performance posted by the company has come out well."
He further added, "For FY12 though the bottomline was at about Rs 15 crore but that included the exceptional item also of Rs 7.5 crore on which if you knockoff the tax amount, net amount of close to about Rs 5 crore which they derived from the Jogeshwari property, which is underdevelopment. So if you go by the Q1 performance which is generally seem to be good for all agrochemical makers they have posted a topline of more than Rs 100 crore with a PAT of close to about Rs 7 crore and going by that yardstick I think the margin expansion is going to happen in the FY13 because of some improvement or the additions of the high margin products in their portfolio coupled with the infusion of the funds, which they have derived from the development of their real estate at Jogeshwari and that has reduced the interest burden also for the company with debt which is largely for the working capital standing close to about Rs 45-50 crore."
"So taking all this into consideration this seems to be the most undervalued agrochemical stock because generally the agrochemical stocks are ruling at a PE multiple of close to seven-eight times but this is ruling at a PE multiple of close to about three times if you go by the results, which has been posted by the company and expect an EPS of close to about 22-23 for FY13. So taking all this into consideration the stock looks quite reasonably priced and from hereon one can expect a price of about Rs 100 in next 12 months or so." Disclosure: I have no holdings in the above stock.