Tamilnadu Petroproducts Ltd
(BSE Code: 500777) (CMP: Rs.38) (FV: Rs.10)
Incorporated in 1984, Tamil Nadu Petroproducts Ltd (TNPL) manufactures, sells and exports petrochemical/chemical products. It offers linear alkyl benzene, an intermediate chemical used in the manufacture of household and industrial cleaning agents; heavy alkylate, a byproduct of linear alkyl benzene; and caustic soda for use in textile, pulp and paper, aluminum and soaps and detergents industries. It also provides chlorine, a by-product of caustic soda for use in sectors such as vinyl chloride, CPW, pulp and paper, water purification, chlorinated solvents, etc; hydrochloric acid; ammonium chloride; compressed hydrogen; and sodium hypochlorite.
With an equity capital of Rs.89.97 crore and reserves of Rs.271.85 crore, TNPL’s share book value works out to Rs.40.22. Its P/BV ratio stands at just 0.94x, which is very attractive. The promoters hold 34.54% of the equity capital, which leaves 65.46% stake with the investing public.
During Q2FY19, TNPL reported 67% higher PAT of Rs.19.33 crore on 41% higher sales of Rs.333.71 crore and an EPS of Rs.2.15. During H1FY19, it reported 31% higher PAT of Rs.28.75 crore on
14% higher sales of Rs.606.83 crore and an EPS of
Rs.3.2. It paid 5% dividend for FY18. Currently, the stock trades at a P/E of 6.39x and is available at 55% discount to its 52-week high of
Rs.84 recorded in November 2017. The stock looks quite attractive based on its performance parameters. Investors can buy this stock with a stop loss of Rs.30. On the upper side, it could zoom to Rs.65-70 in the long-term.