Tulsian's views on Kiri Industries, Bodal Chemical

In an interview to CNBC-TV18, SP Tulsian of sptulsian.com shared his views on Kiri Industries and Bodal Chemical. Here is what he has to say. Below is the transcript of SP Tulsian’s interview with CNBC-TV18's Anuj Singhal and Sonia Shenoy.Anuj: On to the other sector or set of stocks and I must point out that we did point this out first last week when you spoke about this China issue. All these stocks like Kiri Dyes and the other stocks how much more left in these stocks. We have seen big rally from that point? A: If you really want to take a call then you need to take the individual call because just to give you a call on Kiri Industries if you just see the debt reduction they have already announced company that they have reduced the debt by about Rs 450 crore and they will be making the company debt free almost in this year. Even if I take a start of the year with a debt of about Rs 400 crore their debt liability which is now at about may be Rs 70-72 crore on an annualised basis will fall half may be to a level of about Rs 30 crore. It will get reduced by about Rs 40-42 crore. The company has an equity of Rs 26 crore with a face value of Rs 10. That can increase the EPS by straight way by about Rs 10.Now come on the 37 percent stake which they are holding in Dystar Germany, their 37 percent share of profit will give them estimated profit which I presume will be giving then about Rs 250 crore. So, sometimes I wonder that you may have an EPS of closer to about, even for FY16 the year which has just ended they may have an EPS of Rs 110 and face value Rs 10 and share is available to you at a PE multiple of about 1.5. Going for FY17, you may have an EPS of closer to about Rs 150. So, share is available at a PE multiple of Rs 1. So, similar is the case go by the Bodal Chemical. We have heard company confirming which our channel has covered it last week itself that H acid prices have gone up by about 3 times that is from Rs 350-1,000. Bodal Chemical learned to be holding about 1,000 tonne of H acid as the stock and that stock can give them an inventory gain of about may be Rs 60 crore. So, this kind of profitability needs to be worked out individually for each company.This is not only confined to the H acid or may be phenyl sulfone or betha naphthol or J acid or gamma acid. In fact this supplies down the line may be till the companies who are making dyes and pigments. Though they may not stand to gain so much but overall this is seen quite positive and you need to take an individual call on the stock. However, I can say I don’t think that China plants will open for next four to six months and that is seen quite positive. So, all these companies those who are making the dye intermediates mind it not the dyes and pigments but dye intermediates are going to enjoy the party for next three to four months.