JHS Svendgaard Laboratories Ltd :
JHS Svendgaard Laboratories Ltd is a leading dental and oral healthcare company. The company is involved primarily into contract manufacturing for many top brands such as Patanjali, Dabur, Himalaya, Amway and many more in the oral care space. It also manufactures its own brands Aquawhite both in toothpaste and toothbrushes, which are marketed separately as well as exported.
Reason to invest
- JHS Svendgaard Laboratories Ltd (JHS) has transcend from loss to profit after 6 years. JHS has recovered well after its product portfolio growth with top Indian FMCG brand companies in last 2 years.
- The company has reported total revenues of Rs.105.48 Cr. up by 5.39%. EBIDTA is up 68% at Rs.12.04 Cr. and the PAT at Rs.21.98 Cr.
- JHS is also engaged further in aggressive capacity creation and is investing heavily in the capital equipment(s), almost to the tune of Rs.30 Cr. towards setting up additional manufacturing unit and equipment, with the objective of creating a future-ready company by July’2017.
- The overall capacity in toothbrushes to increase from 150 million toothbrushes (March 31, 2017) to 250 million toothbrushes (March 31, 2018). For Toothpaste from 90 million toothpaste tubes (March 31, 2017 ) to 175 million toothpaste (July 30, 2018).
- Some of larger clients include Patanjali, Dabur. Alongwith, JHS own brand, AquaWhite, is scaling distribution and we expect to significantly strengthen the brand franchisee and product positioning in coming months.
- As Per recent news, Patanjali is pushing forward its products not only in domestic but also in international market with e commerce players, a move that in our opinion is going to benefit JHS as its beneficiary.
- Interestingly the Company debt-free coupled with strategic equity investors who understands the business and have provided a significant part of the Company’s precious growth capital with long term goals in mind.
- The on-going disputes at various courts between JHS Svendgaard Laboratories Limited (the company) and various group companies of Procter & Gamble Inc. in India, have been settled with mutual consent and concluded positively for JHS.
- The Board of Directors of JHS Svendgaard Laboratories Ltd at its meeting held on January 05, 2016, has considered and approved allotment of 1,26,74,748 Fully Convertible Warrants.
Fundamental and Technical :
- Industry : FMCG
- Market Cap: 278 Cr
- EPS: 9.41
- PEG: 0.23
- YOY Results : Company has turned from loss to profit in past few year . It has more than 70 % profit in last three years . OPM too has turned from negative to positive.
- QOQ Results : Company is beating not only previous quarters Profits but also OPM respectively.
- Net Sales (Half Yearly) At Rs 75.09 cr has Grown at 40.00 %
- Earnings (332.03%) have increased more than Price (56.20%) which has driven the valuation lower in perspective.
- Company PE is 12.03 whereas industry PE is 52.57.
- ROCE is 4.10 and ROE is 13.68 respectively
- Debt to Equity Ratio half yearly: 0.01, which signifies bargain.
Entry Price and Target:
- Entry price is below 65 and target is 120 by end of FY 2019
For even deep story about JHS visit here
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