NOCIL LTD - Q2 FY 18-19 - RESULTS REVIEW

NOCIL LTD

Q2 FY 18-19 

RESULTS REVIEW

NOCIL in a Snapshot

Part of Arvind Mafatlal Group

Largest Rubber Chemicals Manufacturer in India

Expertise in Rubber Chemical Business over 4 decades

State of the Art, Innovative, Sustainable & Competitive Technologies

Wide range of Rubber Chemicals to suit customer needs

Long Term Business Relationships with Tyre Majors (Both Domestic & International)

Strong Marketing & Distribution Service Network

Certified for Quality and Health/Safety/Environment.

Environment Friendly Processes

Awarded Responsible Care Logo by Indian Chemical Council

MANAGEMENT

1.         HRISHIKESH A. MAFATLAL. PROMOTER & CHAIRMAN

2.         S.R.DEO , MD

PLANTS AT

1.         NAVI MUMBAI PLANT

·       Located in - Belapur’s industrial zone designated for  chemical Industry, about 40 kms away from Mumbai

·       State-of-the-art technology for the manufacture of the entire range of Rubber Chemicals for Tyre & other Rubber Products

2.         DAHEJ PLANT

·       Located about 45 kms from Bharuch, Gujarat

·       Location has synergistic Chemicals & Petrochemicals industry

·       excellent connectivity with Dahej & Hazira Port

·       Fully automated continuous process plant developed completely with in-house technology

Products & their Usage

1. ACCELERATORS

Increase the speed of vulcanization to improve productivity

2. ANTI-DEGRADANTS/ ANTI-OXIDANTS

An ingredient in rubber compounds which deters the ageing or inhibits degradation due to oxygen attack of rubber products thereby enhancing service life

3. SPECIALISED APPLICATIONS

·       Pre vulcanization inhibitor, Post vulcanization stabilizer, Zinc based applications etc.

·       One Stop Shop with Wide Range to suit Market Requirements

·       NOCIL’s Research Centre is recognized by Ministry of Science and Technology, Government of India

·       Key Areas Focussed upon

•     Process Development, scale up, commercial implementation

•     Environmental strategies for sustainable growth

•     Research initiatives as per customers’ perceived needs

•     Rubber Chemicals constitute 3% - 4% of the Rubber Consumption

•     Every year ~40k additional demand for Rubber chemicals is created

•     AUTOMOTIVE AND TYRE INDUSTRY WILL GROW AT 12%-14% FOR NEXT 4-5 YEARS

•     Domestic Tyre Industry have already committed INR 15 – 18 Bn towards expansion plans

•     CONTINUOUS DEMAND FOR RUBBER CHEMICALS

•     CAR PENETRATION IS VERY LOW AND INCREASING

•     INCOME LEVELS ARE RISING

•     STATE OF ART TECHNOLOGY

•     HIGH VALUE ADDED PRODUCTS

KEY STRENGTHS OF NOCIL

•     DEPENDABLE & QUALITY PLAYER

•     WIDE PRODUCT RANGE

•     STRONG CUSTOMER RELATIONSHIPS

•     NEW CAPACITY ADDITIONS

•     COMMITTED PLANS FOR FUTURE GROWTH

H1 FY 19 PERFORMANCE

H1 REVENUE : RS.540 CR (56% OF FY 18 REVENUES)

FROM RS.443 CR IN H1 FY 18, 

VOLUME GROWTH WAS RS.48 CR AND VALUE GROWTH WAS RS.49 CR AND TOTAL H1 FY 19 WAS RS.540 CR

H1 OPERATING EBITDA : RS.159 CR (60% OF FY 18)

HI EBITDA MARGINS : 29.4%

H1 PAT : RS.104 CR (61% OF FY 18) H1 FY 17 : RS.51 CRORES) DOUBLED IN 3 YEARS 

PAT MARGINS : 19.2% (16.4% FY 18; 13.6% FY 17)

Q2 FY 19 PERFORMANCE

REVENUE : RS.272 CR (228 CR FY 18/+19.5%)(181 CR FY 17)

PBT : RS.76 CR ( RS.35 FY 18/+39.7%)( RS.40 CR FY 17)

PAT RS.53 CR ( RS.38 CR FY 18/+38.8%)(RS.27 CR FY 17)

PAT MARGINS : 19.4% (16.7% FY 18/15.1% FY 17)

INTEREST : ZERO

CAPEX – KEY GROWTH DRIVER

PHASE.1 RS.170 CR ANNOUNCED IN MARCH 17

(A)     NAVI MUMBAI EXPANSION COMPLETED. COMMERCIAL PRODUCTION IN Q1 FY 19

(B)     EXPANSION AT DEHEJ; COMMERCIAL PRODUCTION IN Q3 FY 19

PHASE II CAPEX RS.255 CR

1.         FOR EXPANSION OF RUBBER CHEMICALS PRODUCTION AT DEHAJ AND NAVI MUMBAI – ANNOUNCED IN DEC 17

2.         ANOTHER EXPANSION ANNOUNCED IN JAN 18

3.         COMMERCIAL PRODUCTION EXPECTED BY END OF H1 FY 19-20

4.         CAPEX BY INTERNAL ACCRUALS

5.         EXPANSION WILL MAKE ASSET TURNOVER AS 2 X

NOCIL LTD - RESULTS FOR THE 4TH QUARTER ENDED 31.03.2018 - MARCH 2018

NOCIL LTD

RESULTS FOR THE 4TH QUARTER ENDED 31.03.2018

MARCH 2018

NOCIL LTD has declared good results for the 4th quarter ending March 2018. The results are tabulated below.

1. Net Sales has grown 45% YoY and 11% QoQ.
2. Net Profits has grown 100% YoY and 13% QoQ.
3. Equity remaining constant, EPS has grown at the same rate.
4. At the current Market price of rs.201, the Price Earning Ratio works out to      16.48
5. The volume of transactions on NSE is fairly decent at around 3,95,000 on NSE as of today.
6. The share price has grown about 89% over the last one year.
7. Recommended a Dividend of Rs.2.50 per share of FV Rs.10/-

NOCIL	Mar '18	Dec '17	Sep '17	Jun '17	Mar '17	YOY	QOQ
Net Sales	275.87	249.27	227.6	214.81	190.81	44.58	10.67
Consumption of Raw Materials	120.25	108.99	104.7	110.23	86.72	38.66	10.33
Purchase of Traded Goods	0.62	0.74	0.72	0.84	0.7	-11.43	-16.22
Increase in Stocks	1.14	5.09	2.86	-15.6	9.51	-88.01	-77.6
Employees Cost	16.96	15.56	15.96	18.91	12.82	32.29	9
Depreciation	11.16	4	4.16	3.59	3.59	210.86	179
Other Expenses	52.32	49.28	49.34	45.76	40.26	29.96	6.17
P/B Other Inc. , Int., Excpt. Items & Tax	73.42	65.61	49.86	51.08	37.21	97.31	11.9
Other Income	3.21	3.18	5.15	2.79	1.78	80.34	0.94
P/B Int., Excpt. Items & Tax	76.63	68.79	55.01	53.87	38.99	96.54	11.4
Interest	0.23	0.28	0.34	0.37	0.4	-42.5	-17.86
P B T	76.4	68.51	54.67	53.5	38.59	97.98	11.52
Tax	25.45	23.54	16.6	18.88	13.13	93.83	8.11
Net Profit	50.95	44.97	38.07	34.62	25.46	100.12	13.3
Equity	164.48	164.38	164.38	164.14	163.58	0.55	0.06
Basic EPS	3.1	2.74	2.32	2.11	1.55	100	13.14
Diluted EPS	3.05	2.7	2.31	2.09	1.5	103.33	12.96
MP	201
PE	16.48
VOLUME	3,95,000
PRICE TREND
17.05,2018	1 week	2 week	1 month	3 month	6 month	9 month	1 year
Price	214.2	219.25	223.6	186.7	178.5	132.7	105.8
Gain / Loss	-6.51%	-8.67%	-10.44%	7.26%	12.18%	50.90%	89.27%

EXCERPTS FROM NOCIL

INVESTOR PRESENTATION

NOCIL IN A SNAPSHOT

1.  PART OF ARVIND MAFATLAL GROUP

2.  Largest Rubber Chemicals Manufacturer in India

3.  Expertise of over 4 Decades

4.  State of Art Technologies

5.  Long term Business relationships with Tyre Majors

6.  Strong Marketing Network

PRODUCTS

1.  Accelerators

2.  Anti Degradants Anti Oxidants

3.  Prevulcanization Inhibitor

4.  Post Vulcanization Stabilizer

5.  Likely to Grow around 5% every year for next 10 years

6.  Further scope of multiple expansion possible at Dahej

FY 18 VS FY 17

1.  REVENUE has grown over 30%

2.  Operating EBITDA has grown over 66%

3.  PBT has grown over 75%

4.  PAT has grown over 74%

5.  Operating EBITDA margins have grown over 588 bps

6.  PAT Margins have grown over 438 bps

7.  Net cash surplus has grown to Rs.245 crs

8.  Revenue, Operating EBITDA, PBT and PAT have been growing consistently over the last 4 years.

9.  Likewise, operating EBITDA margin, PBT Margin and PAT margin have also been improving during last 4 years

10.              ROE has risen to over 16%; ROCE to 24.5%;total Debt has come down drastically to Rs.5Cr (from 147 cr in FY 15) and D;E ratio is very negligible now.

11.              Similar improvements can be seen in quarterly performance as well over last 4 quarters.

12.              The company has a phased CAPEX PROGRAM of Rs.425 cr, for expansion of Navi Mumbai Plant, Dahej Plant, which will run upto FY 2019-20. So, the expansion will take the operations to a much higher level in due course.

Note : This analysis does not constitute a recommendation /advice for BUY/SELL/HOLD for individual Investors who will need to make detailed analysis further, on their own before coming to their own decisions.