Coromandel is among the oldest companies of India. Able to grow their business from 650 Cr to today 13000 Cr and profit from 50 Cr to today 1000 Cr from 2001 till year. Yesterday’s Revenue is today’s profit. Hence, investment of 1 lakh is already 1 Cr and 2 lakh dividend received. Since last 2-3 years Fertilizer company’s results are in downturn, but yes growth is back.
Current year 9 m results are inline with what we saw during H1 or Q1. This year since the beginning of the year dur to COVID-19 many industries were affected but Agri has shown huge growth. During the H1 we saw the sales growth of 12% which is still continued and profits growth seen during H1 was 48% which is still maintained by 44%. We can say the results were as expected. Due to this growth we saw Coromandel giving the breakout above its Pre-Covid level even before Nifty. Company have increased the stake in European Company. Debt was also reduced during this 9m which helped make better Debt to equity ratio of 0.01 form last year 0.37. Major cost in Fertilizer companies is Raw Material accounting for around 51% cost has been favorable this year due to low cost, it helped increase the margin a lot.
As many people in this group already hold this company during 2014 near 150 as well as near 350 during 2017. For the last 3 years again we have recommended adding more near 350 during this year fall and continue SIP during any fall and can hold it for long term to see multi-year rally. Now as falling of sales has stopped and profits are lifetime high we may not see 350, so new buying or addition again can be done near 600 (Upgraded from 450) and can hold it for long term wealth. No need to book profit till 1044 in the next 2-3 Years.
Listed company EID parry hold around 60% stake as they are promoter while Mutual fund companies like DSP, L&T & franklin combined hold around 12% stake & FPI hold around 4%. Even Insurance companies like IPRU hold around 3.85%.