Results Update – [Manjushree & Gujarat Reclaim]

Eid Mubarak & Happy Ganesh Chaturthi to all our readers. It is a great festive time and I hope we all are enjoying the early weekend.

Couple of our favorite companies did very well in the first quarter and here is an update of the same:

Gujarat Reclaim Rubber (CMP 1050): The co has posted all time high turnover of 53.84 Crores and all time high quarterly Net Profit of 6.6 Crores!!!

The company is a leader in its niche business area of making reclaimed rubber from waste tyres/rubber and has a very good track record. We had initially discussed about the co here. GRRPL is in a steady expansion mode and targets to be a 500 Crore turnover company in next 3 years. One should definitely go through the detailed Management Meet done by our Friend – Donald Francis at his website (requires free login).

As per a recent article, Mott MacDonald has been appointed to provide their services for GRRPL’s new plant in the state of Tamil Nadu. The plant is due for completion early next year.

Considering the leadership position of the co and its strong business dynamics, we feel the co will be able to complete the expansion successfully thus providing a compounded annual growth @ 25-30% for next 2-3 years. Stock is available at less than 6 times expected FY 12 earnings.

Risk – GRRPL earns a major share of its revenues from exports market.

Manjushree Technopack (CMP 80)– We had discussed about this company earlier and have provided multiple updates. The company continues to positively surprise us with its good performance again and again. Here is their Q1 results:

Manjushree Technopack is a leader in the field of packaging and the management has been aggressively exploiting the growth opportunities available in this sector.

For FY 12, the company is most likely to achieve 300 Cr turnover milestone and be a 500 Cr turnover company in 2-3 years. The company may well be able to post a Net Profit of 21-23 Cr for FY 12, resulting into an EPS of 15-17. The stock is available at less than 6 times expected earnings.

Over the last 1 week, there have been some positive developments – peaceful completion of Annaji’s first step of movement, stability/recovery in global markets, solving of Libya’s problem. We feel these are good times to use part of cash or switch from underperformers to better ideas like above. Good ideas at cheap valuations will certainly be value creators in times to come.