Expect Rs 38-40 EPS in Jayant Agro, target Rs 700: SP Tulsian

SP Tulsian of sptulsian.com told CNBC-TV18, "Jayant Agro-Organics is supplying castor oil and castor oil derivatives. This company has their standalone operations plus they have two joint ventures (JV). One of the JV is with Archema of France. They are the largest castor oil user in the world and that JV which is operating here in India, 25 percent is held by Archema and 75 percent is held by Jayant Agro. Jayant Agro is supplying Castor oil to that joint company which is in turn making castor oil derivatives. That castor oil is used in pharmaceuticals, paint, rubber, cosmetics, textiles, lubricant, polymer and plastic sectors, all sort of things apart from that they have a second JV with two Chinese players, one is Mitsui Chemicals and second is Etho Oil Chem.""I am expecting Rs 38-40 earnings per share (EPS) for FY'17 and much better scenario going forward for FY'18. So, I do not see that castor seed procurement will be such a big problem even if they are procured at a high price because this being a critical item will be a pass through and it will increase the margin," he said."So, taking all this into consideration with promoter stake of 66 percent, two Japanese partners are holding 8 percent, high net worth individuals (HNI) are holding 10 percent. So, almost about maybe 85 percent float is with the big promoters and equity is very small at Rs 7.5 crore with face value of Rs 5. So, all this points to a long term positive view building up on the stock. I have taken a target of Rs 700 till next Diwali on Jayant Agro-Organics."