Brokerage house Firstcall Research is bullish on Omkar Speciality Chemicals and has recommended buy rating on the stock with a target price of Rs 165 in its research report dated March 25, 2015.
Firstcall Research 's report on Omkar Speciality Chemicals
“Omkar Speciality Chemicals Private Limited was incorporated on February 24, 2005 and took over business of the Proprietorship Firm M/s. Omkar Chemicals which was in operation since 1983 with capacity of 6 MT per annum for manufacture of molybdenum derivatives. The Private Limited Company was converted into a Public Limited Company on March 18, 2010.”
“Omkar Specialty Chemicals Ltd is mainly engaged in the manufacture and sale of Specialty Chemicals and Intermediates for Chemical and Allied Industries., reported its financial results for the quarter ended 31st Dec, 2014. The company net profit jumps to Rs. 74.86 million against Rs. 33.24 million in the corresponding quarter ending of previous year, an increase of 125.21%. The company achieved a turnover of Rs. 709.42 million registering an increase of 31.91% for the 3rd quarter of the financial year 2015 as against Rs. 537.79 million in the corresponding quarter of the previous year. Reported earnings per share of the company stood at Rs. 3.64 a share during the quarter as against Rs. 1.69 over previous year period. Profit before interest, depreciation and tax is Rs. 163.21 million as against Rs. 108.82 million in the corresponding period of the previous year.”
“At the current market price of Rs. 144.50, the stock P/E ratio is at 11.26 x FY15E and 9.58 x FY16E respectively. Earning per share (EPS) of the company for the earnings for FY15E and FY16E is seen at Rs. 12.83 and Rs. 15.09 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 13% and 15% over 2013 to 2016E respectively. On the basis of EV/EBITDA, the stock trades at 5.24 x for FY15E and 4.66 x for FY16E. Price to Book Value of the stock is expected to be at 1.85 x and 1.55 x respectively for FY15E and FY16E. We recommend ‘BUY’ in this particular scrip with a target price of Rs.165.00 for Medium to Long term investment”, says Firstcall Research report.
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