Launched in 1983, Jyothy Labs’s Ujala is a 26-year old brand and is the largest in the fabric whiteners segment. Ujala Supreme commands 72% an all-India market share by value for Sept 2010.
Investment Argument:
Earlier a single product company, the brand portfolio now comprise of Ujala, Maxo and Exo. Maxo
is expected to grow by 20% in FY11 according to the management while Exo is expected to grow by 25% in FY11.Maxo Safe & Soft which is based on DEPA technology is expected to contribute significantly by FY12.At the current prices of Rs 280, the stock is trading at a PE of 19.7x and 16.8x its FY12E and FY13E earnings respectively which is still cheap compared to its peers.
Jyothy Fabricare Services, its laundry business venture is set to benefit immensely once it is able to achieve scale and size. It is expected to breakeven by March 2011 and will be followed by its national launch.The Company has zero debt on its balance sheet since FY05 and enjoys a negative debt-equity ratio over FY07-FY10.
Investment Argument:
Earlier a single product company, the brand portfolio now comprise of Ujala, Maxo and Exo. Maxo
is expected to grow by 20% in FY11 according to the management while Exo is expected to grow by 25% in FY11.Maxo Safe & Soft which is based on DEPA technology is expected to contribute significantly by FY12.At the current prices of Rs 280, the stock is trading at a PE of 19.7x and 16.8x its FY12E and FY13E earnings respectively which is still cheap compared to its peers.
Jyothy Fabricare Services, its laundry business venture is set to benefit immensely once it is able to achieve scale and size. It is expected to breakeven by March 2011 and will be followed by its national launch.The Company has zero debt on its balance sheet since FY05 and enjoys a negative debt-equity ratio over FY07-FY10.
At the current prices of Rs 275, the stock is trading at a PE of 19.7x and 16.8x its FY12E and FY13E earnings respectively which is still cheap compared to its peers. BUY.
No comments:
Post a Comment