Aries Agro Ltd

Money Times - - Techno Funda -

(BSE Code: 532935) (CMP: Rs.115.65) (FV: Rs.10)

In­cor­po­rated in 1969, Mum­bai based Aries Agro Ltd (AAL) to­gether with its sub­sidiaries man­u­fac­tures and sup­plies mi­cronu­tri­ents and other cus­tom­ized nu­tri­tional prod­ucts for plants and an­i­mals. Its prod­ucts in­clude EDTA (Eth­yl­ene Di­amine Tetra Acetic acid) chelates, amino acid chelates, sol­u­ble and sul­phur based fer­til­iz­ers, pes­ti­cides, fish­eries and an­i­mal nutri­tion, crop man­age­ment prod­ucts and plant nu­tri­ents. It also deals in vet­eri­nary prod­ucts. Its dis­tri­bu­tion chan­nel com­prises over 6,400 dis­trib­u­tors and a di­rect re­tail touch point of more than 86,000 deal­ers. Its re­tail out­lets are spread across 27 states.

AAL has an eq­uity cap­i­tal of Rs.13 crore sup­ported by re­serves of Rs.169.9 crore. The pro­mot­ers hold 52.66% of the eq­uity cap­i­tal, which leaves 47.34% stake with the in­vest­ing pub­lic. Ace in­vestors Vi­jay Ke­dia holds 3.07% and S. Shyam holds 2.62% stake in this com­pany. With share book value of Rs.160.83, its P/BV ra­tio stands at just 0.72x.

For FY18, AAL re­ported 48% higher PAT of Rs.10.48 crore on higher sales of Rs.296.72 crore and an EPS of Rs.8.06. Dur­ing Q1FY19, it re­ported 66% higher PAT of Rs.3.16 crore on sales of Rs.56.42 crore and an EPS of Rs.2.43. It paid 23% div­i­dend for FY18.

Cur­rently, the stock trades at a P/E of just 12.81x and is avail­able at 60% dis­count to its 52-week high of Rs.290.15 recorded in Oc­to­ber 2017. Based on its per­for­mance pa­ram­e­ters, the stock looks quite at­trac­tive at the cur­rent level. In­vestors can buy this stock with a stop loss of Rs.100. On the up­per side, it could zoom to Rs.160-175 in the medium-to-long term.

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