P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways- View

maheshi

Active Member
#52
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

( fig. In ` cr. )
Q3FY12

Q3FY11

Revenue




Agri-Input


CSM



Polymer


125-135


98-110


0

85.8


87


16.6

Total


223 - 245

189.4




EBITDA


43 - 48

29.86




Net Profit


23 - 26

15.21




EPS ( in ` )


9.2 - 10.4

12.42



















( fig. In ` cr. )
9'Month'FY12

9'Month'FY11

Revenue




Agri-Input


CSM



Polymer


420 - 430


252 - 264


0

305.1


150.6


51

Total


672 - 694

506.7




EBITDA


123 - 128

83.71




Net Profit


68 - 75

43.73




EPS ( in ` )


27.1 - 29.9

35.69









Link to pdf of my Q3FY12 as well as 9'Month'FY12 estimate for PI Industries Ltd.

http://www.scribd.com/doc/76999128/


Rgds.
 

maheshi

Active Member
#53
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Edelweiss Q3FY12 Estimate for PI Industries :



Revenue - 246.3 cr.

EBITDA - 43.1 cr.

PAT - 23.9 cr.



Comments :

Expect EBITDA margin expansion of 175bps YoY on

account of improved product mix and absence of the

low margin polymer business in the quarter.



Performance of newly launched products in Q2FY12

and the order book position of custom synthesis

business key monitorables
 

maheshi

Active Member
#54
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

From the latest shareholding pattern disclosed, it seems that Sequoia and Deutsche are continuously increasing their stake in PI Ind.... They have together bought further ~1.4 % stake in Dec.11 qrtr. by adding 3,45,449 shares in total..... Sequoia seems to be more aggresive with it buying ~2.3 lakh shares in the qrtr. to increase its stake in the co. to 3.7 %....



Together both the entities now have 7.45 % stake in PI Ind....



Rowanhill has sold 1 lakh shares and an entity called Bengal Finance & Investment has picked up 1.42 % stake (3.55 lakh shares)..



Rgds.
 
#55
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Dear Maheshiji,

I fully appreciate your efforts in analyzing the company and its business segment.

Recently I have spoken to the management and following are my doubts if you can clarify.
  1. They don't disclose brand wise sales or major brands and still claims them in top 5 in the industry. But this is a industry where we can not get the authenticate data from reliable source and so we have to rely on different companies. So how is it?
  2. In custom synthesis who are there largest customers and normally how much order book is constituted by top 5 customers.
  3. What can be potential of Sony R&D partnership? Currently company is not sharing anything and may be we can expect something by FY15 onwards.
  4. What is your expectant valuation? Divis get anything above 25 p/e while Rallis or Bayer will get around 16-18 ka p/e. In best case scenario what kind of valuation you see considering 25-30% growth in coming 2-3 years.
  5. Some where I read revenue contribution from new plant will be around 700-750 crs, but mgt indicates it anywhere between 250-300 crs of turnover. so in best case the asset turnover shold be in the range of 2x capex. correct me if i am wrong.
Waiting for your reply.

Thanks and regards,
 

maheshi

Active Member
#56
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Dear Maheshiji,

I fully appreciate your efforts in analyzing the company and its business segment.

Recently I have spoken to the management and following are my doubts if you can clarify.
  1. They don't disclose brand wise sales or major brands and still claims them in top 5 in the industry. But this is a industry where we can not get the authenticate data from reliable source and so we have to rely on different companies. So how is it?
  2. In custom synthesis who are there largest customers and normally how much order book is constituted by top 5 customers.
  3. What can be potential of Sony R&D partnership? Currently company is not sharing anything and may be we can expect something by FY15 onwards.
  4. What is your expectant valuation? Divis get anything above 25 p/e while Rallis or Bayer will get around 16-18 ka p/e. In best case scenario what kind of valuation you see considering 25-30% growth in coming 2-3 years.
  5. Some where I read revenue contribution from new plant will be around 700-750 crs, but mgt indicates it anywhere between 250-300 crs of turnover. so in best case the asset turnover shold be in the range of 2x capex. correct me if i am wrong.
Waiting for your reply.

Thanks and regards,


--------------------------------
Apologise for delay in reply as was away from the desk....Please find my replies in bold

--------------------------------------
[*]They don't disclose brand wise sales or major brands and still claims them in top 5 in the industry. But this is a industry where we can not get the authenticate data from reliable source and so we have to rely on different companies. So how is it?
---------------------------------------

PI Ind. has many common clients in CSM and Agri space which is one of the reason why its so closed in sharing sales data.....Second reason being its products being patented molecules and it wants to extract entire juice out of it because of first-mover advantage........I think they should start sharing the data within few years once they achieve a critical scale..

As far as their Agri segment positioning in top 5 in India... thats undisputed fact which can be easily derived from the revenue figures of listed Agrichemical cos. of India.




----------------------------

[*]In custom synthesis who are there largest customers and normally how much order book is constituted by top 5 customers.
------------------------------------

Who are the largest customers that detail is again not disclosed but almost all major MNC innovator agrichemical cos. of the world are PI's clients..... Top 5 customers contribute ~80 % to CSM order book.



---------------------------------
[*]What can be potential of Sony R&D partnership? Currently company is not sharing anything and may be we can expect something by FY15 onwards.
----------------------------------

The potential could be good...... and I say good instead of huge because patent of the produce of the relationship is going to be owned by Sony........hence, once something is innovated out of this, PI will be a natural CSM partner for that produce being involved since inception.




---------------------------------
[*]What is your expectant valuation? Divis get anything above 25 p/e while Rallis or Bayer will get around 16-18 ka p/e. In best case scenario what kind of valuation you see considering 25-30% growth in coming 2-3 years.
----------------------------------

Here, first we need to see how agri segment fares in near future as there are many headwinds in that space right now......CSM segment plant has got delayed thats a bad news which means that the real contribution from the new plant will come from only FY14 onwards. If Q4FY12 is also as muted as Q2 & Q3 then the valuations PI is commanding right now are one of the highest valuations commanded by it in its history...... Hence, lets wait for Q4FY12 performance and then decide what valuation PI deserves.... Its historical trading range over last many years has been 12x forward and 15x TTM earnings and for it to change both the operational segments of the company need to perform exceedingly well.



---------------------------------
[*]Some where I read revenue contribution from new plant will be around 700-750 crs, but mgt indicates it anywhere between 250-300 crs of turnover. so in best case the asset turnover shold be in the range of 2x capex. correct me if i am wrong.
-------------------------


700-750 cr. revenue is from both, old and new capacities combine.... From new plant maximum revenue they can generate should be 350-400 cr.
 

maheshi

Active Member
#57
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

My Q4FY12 as well as FY12 estimates for PI Industries Ltd :


( fig. In ` cr. )
Q4FY12

Q4FY11

Revenue




Agri-Input


CSM



Polymer


110 - 125


115 - 120


0

105.3


86.1


20.6

Total


225-245

212




EBITDA


43 - 48

39.9




Net Profit


24 - 28

20.4




EPS ( in ` )


9.6 – 11.2

9.11



















( fig. In ` cr. )
FY12e

FY11

Revenue




Agri-Input


CSM



Polymer


508 - 522


358 - 362


0

410


241


70

Total


866 - 884

721




EBITDA


153 - 158

125




Net Profit


82 - 86

65.1




EPS ( in ` )


33 – 34.5

29.1
 
#58
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Hello Maheshi,

Your comments are quiet detailed and help in understanding the company well. Would you be able to share the audio clipping of the latest conference calls.

Regards
Ankit

--------------------------------
Apologise for delay in reply as was away from the desk....Please find my replies in bold

--------------------------------------
[*]They don't disclose brand wise sales or major brands and still claims them in top 5 in the industry. But this is a industry where we can not get the authenticate data from reliable source and so we have to rely on different companies. So how is it?
---------------------------------------

PI Ind. has many common clients in CSM and Agri space which is one of the reason why its so closed in sharing sales data.....Second reason being its products being patented molecules and it wants to extract entire juice out of it because of first-mover advantage........I think they should start sharing the data within few years once they achieve a critical scale..

As far as their Agri segment positioning in top 5 in India... thats undisputed fact which can be easily derived from the revenue figures of listed Agrichemical cos. of India.




----------------------------

[*]In custom synthesis who are there largest customers and normally how much order book is constituted by top 5 customers.
------------------------------------

Who are the largest customers that detail is again not disclosed but almost all major MNC innovator agrichemical cos. of the world are PI's clients..... Top 5 customers contribute ~80 % to CSM order book.



---------------------------------
[*]What can be potential of Sony R&D partnership? Currently company is not sharing anything and may be we can expect something by FY15 onwards.
----------------------------------

The potential could be good...... and I say good instead of huge because patent of the produce of the relationship is going to be owned by Sony........hence, once something is innovated out of this, PI will be a natural CSM partner for that produce being involved since inception.




---------------------------------
[*]What is your expectant valuation? Divis get anything above 25 p/e while Rallis or Bayer will get around 16-18 ka p/e. In best case scenario what kind of valuation you see considering 25-30% growth in coming 2-3 years.
----------------------------------

Here, first we need to see how agri segment fares in near future as there are many headwinds in that space right now......CSM segment plant has got delayed thats a bad news which means that the real contribution from the new plant will come from only FY14 onwards. If Q4FY12 is also as muted as Q2 & Q3 then the valuations PI is commanding right now are one of the highest valuations commanded by it in its history...... Hence, lets wait for Q4FY12 performance and then decide what valuation PI deserves.... Its historical trading range over last many years has been 12x forward and 15x TTM earnings and for it to change both the operational segments of the company need to perform exceedingly well.



---------------------------------
[*]Some where I read revenue contribution from new plant will be around 700-750 crs, but mgt indicates it anywhere between 250-300 crs of turnover. so in best case the asset turnover shold be in the range of 2x capex. correct me if i am wrong.
-------------------------


700-750 cr. revenue is from both, old and new capacities combine.... From new plant maximum revenue they can generate should be 350-400 cr.
 

maheshi

Active Member
#59
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Hello Maheshi,

Your comments are quiet detailed and help in understanding the company well. Would you be able to share the audio clipping of the latest conference calls.

Regards
Ankit
Hi Ankit,

Audio clipping are a heavy file as each concall is more than 70 minutes long.... however will try to procure text transcript for u... kindly mail me your mail id...

Rgds.
 
#60
Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Hi Maheshi,

It would be interesting to read through all historical transcripts to understand the companys growth. My id is [email protected]

Based on reading of documents from company web site was wondering if you would be having any information or data on
The quarterly segmental profitability by Agri and CSM, and
The impact of foreign currency on the results of the company

Thanks and regards
Ankit

Hi Ankit,

Audio clipping are a heavy file as each concall is more than 70 minutes long.... however will try to procure text transcript for u... kindly mail me your mail id...

Rgds.
 
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