Kamdhenu Paints shares jump 70% since listing in Jan. Here’s what CMD Satish Agarwal has to say

Shares of Kamdhenu Ventures, the small-cap paint business of Kamdhenu Group, have rallied 70 per cent since listing in January. The scrip climbed to Rs 305.95 apiece intraday on July 17, against the close of Rs 178.50 on January 24. In an exclusive interaction with Business Today Satish Kumar Agarwal, Chairman and Managing Director of Kamdhenu Group, said the paints company will become profitable in FY24.

The company reported a consolidated loss of Rs 11.27 crore in financial year 2022-23 (FY23) on gross sales of Rs 259.50 crore. He added that being a small company, it needs to growth Rs 100-125 crore every year.

Asked why investors were bullish on Kamdhenu Paints, Agarwal said the business normally grows 18-20 per cent annually, but the firm has ambitious plans to grow faster over the next five years. “Kamdhenu is aiming for a growth of 38-40 per cent annually. We are looking for a turnover of Rs 1,000 crore by FY28 with an industry EBITDA margin of 15 per cent-16 per cent. So, we have very aggressive plans for the paint business related to interiors, exteriors, expanding network and geographical area. Maybe, investors are factoring in these developments in the equity markets.”

He further added that the firm doesn’t see any threat from big players like Asian Paints and Berger Paints in achieving the FY28 revenue target. Shares of Asian Paints and Berger Paints have risen by 22 per cent and 19 per cent, respectively, since January 24. Indigo Paints and Kansai Nerolac have also surged 16 per cent and 12 per cent, respectively, during the period, while the benchmark BSE Sensex has gained 8.33 per cent.

On the other hand, shares of the company’s steel business Kamdhenu Ltd have advanced 70 per cent in the past year. Sharing his views on the business, Agarwal said, “Kamdhenu Ltd is an asset-light unique model. Normally, a steel business grows at the rate of 6-7 per cent. However, we are working for 18-20 per cent growth annually. We are leveraging brand value with quality performance. We also have a retail chain of more than 8,500 dealers from Kashmir to Kanyakumari and from Kutch to Assam. You will find retail counters of Kamdhenu steel everywhere. We are the largest selling brand across the country in retail.”

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