Hi Friends,
This is my first post on ValuePickr forum, hoping to maintain the sanity of platform and help in separating wheat from the chaff.
I wanted to discuss about this micro cap company called Premier Polyfilm Ltd, which looks like a good bet to play infrastructure theme.
Product: Company mainly manufacture PVC flooring, insulating mats, artificial leather etc. mainly of industrial and infra use
Management: : From the accounting perspective, they feel clean and no obvious red flags from annual report. The debt is reduced considerably in last few years (from 32cr in 2018 to 10cr in 2023). Also I do not find any preferential issues from public information.
The dividend is also paid consistently since last few years albeit a small percentage (Rs 0.50 per share since 2016 except in year 2020)
Sales and Profit growth : Last 10 years sales growth are close to ~15% and profit growth is around ~20%
Triggers for growth ; apart from obvious cycle of infra, the stock looks a good beneficiary of falling crude oil price, as the PVC resin is derivative of oil. It was able to maintain around ~9% of margin in favourable oil scenario, which is good. Even in worst case scenario, margin was around ~7%.
Risk : Apart from obvious risk of crude oil price and infra story going bust, I couldn’t find any significant negative on this stock.
Reaching out to the folks on this forum, to help me figure out any negative on this stock thesis.
Disclosure :
- Holding tracking position in my portfolio.
- Published stock thesis on blog Premier Polyfilm : The PVC Story - by SKY01 - BetaIdeaz before few days.
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