Astral Poly Technik share turned Rs 1 lakh into Rs 81 lakh in 10 years, did you miss the rally?

Astral Poly Technik share has delivered strong returns during last ten years. Rs 1,00,000 invested in the stock on December 31, 2009 would have grown to Rs 81.57 lakh on  December 31, 2019. Market was closed on account of New Year on January 1, 2010 (Friday). Astral Poly Technik share price has zoomed from Rs 14.42 on December 31, 2009 to Rs 1,176 on BSE. Astral Poly Technik stock has delivered 8,057% returns for its investors in 10 years.

9 of 18 brokerages rate the stock "buy" or 'outperform', four "hold", three "underperform" and two "sell", according to analysts' recommendations tracked by Reuters.

Astral Poly Technik share price has risen 27.32% during the last one year. In comparison, the benchmark Sensex rose 15.96% during the last one year.

Financial performance

Astral Poly Technik reported a 84.5% rise in net profit to Rs 82.10 crore in Q2 of current fiscal compared to   Rs 44.50 crore in the corresponding quarter of previous fiscal.

Sales rose 8.5% in Q2 to Rs 678.30 crore in Q2 September 2019 against Rs 625.40 crore in Q2 of corresponding fiscal. The announcement was made after market hours yesterday, 24 October 2019.

Consolidated EBITDA jumped 24.16% to Rs 121.80 crore during Q2 September 2019 as against Rs 98.10 crore in Q2 September 2018. EBITDA margin also showed an improvement to 17.96% in Q2 September 2019 compared with 15.69% in Q2 September 2018.

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Earnings per share rose to Rs 5.44 in Q2 of current fiscal against Rs 2.97 in the corresponding period of previous fiscal.  Profit after tax margin rose to 12.13% in Q2 against 7.21% in corresponding period of previous fiscal. The firm has constantly improved its financial performance during the last 10 years.

For fiscal ended March 2019, the firm logged Rs 2,507 crore in net sales compared to Rs 291.17 crore in sales for fiscal ended March 2010.

Debt to equity ratio for this plastic products manufacturer during year ended March 2019 stood at 0.13.  Value of debt to equity ratio lower than 1 signals ther firm's assets are more funded by equity than debt.

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For fiscal ended March 2019, the firm logged Rs 200.91 crore in net profit compared to Rs 27.71 crore for fiscal ended March 2010. Price to book value ratio for year ended March 2019 stood at 10.86 compared to 1.86 for the fiscal ended March 2009.

Asset turnover ratio for the year ended March 2019 improved to 119.43% compared to 110.54% for the fiscal ended March 2009. Return on capital employed for the year ended March 2019 stood at 21.09% compared to 17.74% for the fiscal ended March 2009.

What brokerages said

After the firm reported its earnings for quarter ended September, Anand Rathi said, "Driven by its strong pipes performance Astral's Q2 FY20 revenue/ EBITDA/PAT grew 8%/26%/83% y/y. Weakness in adhesives was expected due to correction measures taken in Resinova. Ahead, we expect a healthy growth pace in pipes and adhesives as structural changes at Rex and Resinova have been completed.

We dig Astral for its consistent focus on growth and profitability, supported by innovative-product launches, vigorous brand-building and successful product diversification. We retain our Buy rating on the stock with target price of Rs 1301.Growth and margin improvement in adhesives are key monitorables."

The market price of the stock that time stood at Rs 1,140.

After Q2 earnings were announced, Dolat Capital said, "Astral is going through expansion at all its plants and is investing heavily in branding activities. We believe that these are investment phases and the firm will reap long term benefits of these strategies for prolonged periods at least for the next 5 years. With new product addition in the adhesive segment as well as pipe segment, we feel that revenue growth along with margin profile should get better. With high growth trajectory and expansion in return ratios, valuations will remain expensive. Reiterate Buy with a target price of Rs 1,388." Market price of the stock that time stood at Rs 1,124.

Astral Poly Technik is engaged in the production of plastic products. The company and its subsidiaries are engaged in the business of manufacturing and trading of pipes, fittings and adhesive solutions.

Its product range includes pipe category for plumbing, industrial, drainage, fire protection, agriculture, electrical conduit and ancillary, and adhesive category for construction, maintenance, wood care and automotive. The company has its manufacturing facilities in India and abroad, and sells across the globe.