Andhra Petrochemicals Limited (APL), the only company in the country manufacturing a range of oxo-alcohol products. APL is expected to do well in the next one-year or so. It was in losses for years. Now it has turned around. This year it may declare 10% dividend.
Also the company is expanding its plant capacity from 39,000 tonnes per annum to 73,000 tpa. This Rs 280-crore expansion project is expected to be commissioned by the second half of 2009.
Key risk for the business is that it is a volume business. Any fall in margins due to rise in inputs cost can worsen the situation.
We initiate a buy (CMP Rs 16.25) with a price target of Rs 25 in next 12 months time.
Also the company is expanding its plant capacity from 39,000 tonnes per annum to 73,000 tpa. This Rs 280-crore expansion project is expected to be commissioned by the second half of 2009.
Key risk for the business is that it is a volume business. Any fall in margins due to rise in inputs cost can worsen the situation.
We initiate a buy (CMP Rs 16.25) with a price target of Rs 25 in next 12 months time.
1 comment:
Date: June 25, 2007.
The company has come out with fabulous results and 10% dividend.
enjoy.
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