Thread by @Journey2Wealth_

A mega thread on Unique Zero Waste model company

Shree Pushkar Chemical & Fertilizer

Cmp - 228 rs
Mcap - 703 cr
Eps: 15.8
D/e: 0.24

𝑼𝒏𝒕𝒂𝒑𝒑𝒆𝒅 𝑷𝒐𝒕𝒆𝒏𝒕𝒊𝒂𝒍. 𝑨𝒍𝒍 𝒔𝒆𝒕 𝒕𝒐 𝒇𝒍𝒚 𝒉𝒊𝒈𝒉

Thread (1/n)👇

2/n)🎯About Company -

🔸Shree Pushkar Chemicals & Fertilizers founded in 1994 is an established market leader in the manufacturing of dyes & dyes intermediates and 4th largest SSP fertilizer player in India.

🔸Company is engaged into following different business verticals👇

🎯Lets first understand -

Q) What are dyes & dye intermediates?🤔
👉Dyes are nothing but organic compound that gives a permanent colour to your clothes,leather,etc
Eg -Reactive dyes
&
👉Dye intermediates act as a raw material to produce this dyestuff
Eg -Vinyl sulphone,H-acid

🎯Strength of Shree Pushkar -

✅ Fully backward and forward integrated
✅Unique zero waste model
✅ Turnaround Acquisitions
✅Debt light with strong operating Cashflows
✅Own Power generation
✅ Capacity expansion funded through internal accuruals
✅ Diversified Product Mix

♦️Business model -
👉It works in 5 different business and its sub products with applications are mentioned in below image

🎯Revenue mix
Dyestuff and dye intermediates contributes 52% to the revenue and
rest 48% comes from fertilizers and its allied products.

Future Growth Prospect -

⭐Unit 5 expansion-

👉At planned capex of 90 cr, Company will be doubling its entire dyestuff & dye intermediates capacities from 14000 Mtpa to 30000 Mtpa

👉It is expected to get commisioned by Jan 2022 which would add 225 cr to its topline for Fy23

⭐In 2020, Company acquired 100% stake in Madhya Bharat Phospate limited at cost of 28 cr which would now contribute 100 Cr to its sales going forward.

Post these takeover, Pushkar becomes one of the India's largest manufacturer of Single super phospate (SSP- a fertilizer)

⭐With capex of 21 cr, Company is setting up 2 Solar power plants which would save its power cost considerably and would effectively add 6 cr to the the bottom-line per annum which would be operational in H2 Fy22.

Financial Performance :

🔥Shree Pushkar delivered outstanding set of numbers for Q2 Fy22 both in terms of yoy and qoq basis

✅Sales grew by 77%⏫ Yoy
✅Ebitda margin improved by 150bps🔼 Yoy
✅Pat up by 115%⏫ Yoy

Financial Statements :

🔸Even after heavy capex of around 120 Cr, Company is sitting on liquid cash worth 86 cr with hardly any debt.
🔸OCF/Ebitda remains very healthy at 95%

🌠Outlook -

🔸Unit 5 expansion in dyes will be a major driver for its growth in Fy23

🔸For Fy23,Pushkar is all set to deliver strong sales of almost 800 cr backed by Volume growth.

🔸Strong presence in fertilizer pan India basis would add meaningfully to its sales

🔸For Fy22, Expect it to clock sales of 550 cr with an eps of 21

🔸For Fy23, Company is well poised to grow at 40% taking its sales to 800 cr with Roce of 24% with an eps of 26.

🔸At cmp of 228, the company is trading at forward pe of merely 8.5

#hiddengem

👉Point to Note :

♦️Prices of its key dye intermediates namely Vinyl sulphone & H acid have shot up to 400 & 600 Rs respectively🔼

♦️Q3 Fy22 would be one of the best quarter backed by strong price realisation

⭐Promoter's have issued warrant to themselves at price of 190/share

Btw,Do you know?

🔥Growth in textile is directly proportional to growth in dyes🌠

♦️80% of dyes is extensively used in textiles

Thats the end to thread of Shree Pushkar chemicals

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