GNFC reaps a bounty

about 8 months ago
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GNFC has been figuring out amongst the stop gainers on the BSE for the past couple of days. Today too, it is the second top gainer, going up over 10.5% to Rs.475.40. Its 52-week high is at Rs.548.50.

The market is happy with the Q4FY18 performance, which was announced yesterday.

The company posted a 38% (YoY) jump in net profit at Rs.329 crore; this is very good given the fact that in Q4FY17, the company had an exceptional gain of Rs.292 crore.

GNFC’s revenue rose 46.5% to Rs.1764 crore.

It did very well on the operating profit front too, with EBITDA jumping up 16.5 times to Rs.28.50 crore.

In our Market Whispers column, we have given a more detailed analysis, stating, “the performance is led by excellent demand environment for TDI coupled with rising prices. Recall that on 15-1-18, company has raised price of TDI from by 8% or Rs. 26/kg to Rs. 351 per kg, due to global supply tightness. Company has achieved an EPS of Rs. 21.17 for Q4FY18 and Rs. 51 for FY18, implying PE multiple of just 8.4x.

Interestingly, company’s balance-sheet has strengthened remarkably, with no long term debt seen outstanding, while working capital deb is reduced to Rs. 229 crores from Rs. 1,073 crores a year ago.

Company has also declared dividend of Rs. 7.50 per share, which is highest ever in history of the company and reflects management's confidence on business prospects.

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