VISIT NOTE

27 AUG 2014

Vinati Organics
NOT RATED
INDUSTRY
SPECIALITY CHEM
CMP (as on 26 Aug 2014)
Rs 403
Target Price
NA
Nifty

7,905

Sensex

26,443

KEY STOCK DATA

Bloomberg

VO IN

No. of Shares (mn)

49

MCap (Rs bn) / ($ mn)

20/328

6m avg traded value (Rs mn)

Well placed
We met with the management of Vinati Organics
Ltd to get insights on the business and outlook.
Vinati organics (VOL) is a mid-size specialty focused
company having a concentrated portfolio (3
products contributing ~90% to revenues). Vinati has
delivered a strong 30% CAGR in revenues/PAT over
FY09-14 driven by strong demand for its products,
capacity expansions and few product additions.

17

STOCK PERFORMANCE (%)

52 Week high / low

Rs 416/74
3M

6M

12M

Absolute (%)

54.5

52.9

331.3

Relative (%)

47.5

26.9

288.8

SHAREHOLDING PATTERN (%)

Promoters

75.00

FIs & Local MFs

1.15

FIIs

2.75

Public & Others

Source : BSE

Meeta Shetty, CFA

meeta.shetty@hdfcsec.com
+91-22-6171-7338

21.10

Focused approach : VOLs product selection

approach is driven by three key philosophies, (1)
niche product with a high technological barriers. (2)
ability to be globally competitive on both quality and
cost. (3) Production based on clean and green
technology with nil environmental hazards. VOL
follows stringent due diligence to narrow down on
product section based on the given three parameters
and hence has a very concentrated product basket,
total 14 products with top 3 contributing ~90% of
revenues.
Global leadership : Post product launch VOL aims

to be the global leader through quality and cost

efficiencies, it is this vision which has led to VOLs
global leadership in three products. VOL is globally
the largest producer of two products (Isobutyl
Benzene - IBB and 2-acrylamido 2-methylapropane
sulphonic acid - ATBS) and the largest Indian
manufacturer for one product (Isobutylene - IB).
Through enhancing the quality and cost efficiency
VOL aims to provide the product at competitive
prices.

Growth drivers : ATBS and IB (~54% of revenues)

will be the main drivers going ahead for VOL. The
ATBS market is witnessing a growth of ~10-15%
globally. Moreover, with increase in customer base as
well as higher demand from existing customers will
lead to ~20% CAGR in ATBS revenues for VOL over
the next three years. VOL entered into IB as a
backward integration for ATBS. IB is a gas based
product and VOL is the only Indian manufacturer
currently. VOL is witnessing huge surge in demand for
IB , the overall market in India which hovered around
4,000 metric tons in 2012-13 stands a ~7,000 metric
tons as of date.

Outlook and valuation : VOL commands premium

over peers due to its best in class return ratios and
strong growth visibility. VOL currently trades at ~14x
FY16E (Bloomberg est.) EPS of Rs 29. The stock is
currently NOT RATED by us.

FINANCIAL SUMMARY
YE Mar (Rs mn)
Net Revenues
Growth (%)
EBIDTA
EBIDTA margin (%)
APAT
EPS (Rs.)
P/E (x)
EV/EBITDA
RoE (%)

FY11
3,226
39.2
761
23.6
520
10.5
38.3
27.2
36.2

FY12
4,475
38.7
978
21.9
548
11.1
36.3
21.8
29.3

FY13
5,529
23.6
1241
22.4
687
13.9
29.0
17.7
28.5

FY14
6,961
25.9
1621
23.3
862
17.5
23.1
13.0
27.8

Source: Company, HDFC sec Inst Research

HDFC securities Institutional Research is also available on Bloomberg HSLB <GO> & Thomson Reuters

VINATI ORGANICS : VISIT NOTE

REVENUE BREAK UP - PRODUCTWISE

IBB

120

VOL exports majority of IBB and

ATBS to US and EU (~40% each)
and rest goes to Asian markets

100
80

38

IB

Others

10

11
13

43
57

60

IB is marketed only in domestic

market, VOL is the only large
player with 70% market share

ATBS

48

41

41

40
57

20

51
33

40

43

FY12

FY13

35

0
FY09

FY10

FY11

FY14

Source : Company, HDFC sec Inst Research

TOP 3 PRODUCTS
Product

Application

Competition

Isobutyl Benzene (IBB)

Pharmaceutical. A key raw material

used in Ibuprofen

VOL is the largest manufacturer globally and

commands ~60% market share. IOL Chemicals
& Pharmaceuticals and SI Group, both Indian
companies, are the competitors.

2-acrylamido 2-methylapropane
sulphonic acid (ATBS)

Isobutylene (IB)

Various applications ranging from water

VOL commands ~40% market share globally.
treatment, paints, textiles, fibre,
Lubrizol (~15000 tpa) and Toagosei (~8000 tpa)
detergents, oil field, mining chemicals
are the only two competitors
and construction chemicals
VOL is the largest Indian manufacturer and
commands ~70% market share in Indian
An intermediate used in chemicals, food
market. VOL markets IB only in domestic
additives and antioxidants
market. Savita Chemicals Ltd is the only other
India manufacturer with a small capacity.

VOL's installed
capacity (tpa)
16,000

26,000

12,000

Source : Company, HDFC sec Inst Research

Page | 2

VINATI ORGANICS : VISIT NOTE

Dominant market share in key products

VOL product basket has evolved from mere 2

products in FY01 to 14 as of FY14. Companys
stringent product selection has restricted the product
basket compared to peers (Atul Ltd 1,400
products). VOLs top three products contribute ~90%
of revenues. IBB and ATBS are the highest contributor
for VOL with 41/35% contribution.

commercial production of ATBS at its plant in Lote

Parashuram, Maharashtra in 2002, based on
technology sourced from the National Chemical
Laboratories, Pune. VOL has been consistently
expanding the capacity for ATBS from ~1000 tpa in
2002 to 26,000 tpa in 2014.

IBB Isobutyl Benzene (35% of FY14 revenues)

Vinati is worlds largest producer of IBB and its

Mahad raigad plant is biggest IBB manufacturing
facility in the world. IBB is the basic raw material in
manufacture of Ibuprofen. VOL began commercial
production of IBB at its factory in Mahad,
Maharashtra in 1992, based on technology from the
renowned Institute Francais du Petrole (IFP) in
France. It has since expanded its capacity in phases to
16,000 tpa and supplies to all major Ibuprofen
manufacturers globally.
IBBs contribution has been coming down from
~57% in FY09 to 35% in FY14 and is expected to slide
further driven by higher growth in ATBS and new
product launches. IBB market is growing at 5-7%
CAGR, we expect the Ibuprofen market to remain
subdued as new generation NSAIDS replace older
drugs. VOL expects growth in IBB to remain <10%
over FY14-16E.

Isobutylene (IB) (13% of revenues FY14)

VOL entered into IB as a backward integration for

ATBS. Vinati Organics commissioned its Isobutylene
(IB) plant, the largest in India, in June 2010 with a
capacity of 12,000 MT. IB is a hydrocarbon of
significant industrial importance. It is used as an
intermediate in the production of variety of products.
VOL not only uses IB for captive consumption, as raw
material for ATBS, but has also derived a revenue
stream from selling it in domestic market. IB market
in India was restricted at ~4000mtpa due to higher
import prices. Post VOLs commercialization, VOL
sells ~7000mtpa apart from captive consumption of
~5000mtpa.

VOL has planned to debottleneck its IB facility and

also expects to incur capex ~Rs1.0bn (including
debottlenecking exercise for other products). VOL
expects IB to grow >30% over the FY14-16E.

2-acrylamido 2-methylapropane sulphonic acid (41% of

revenues FY14)

Vinati Organics is also the largest manufacturer of 2Acrylamido 2-Methylpropane Sulfonic Acid (ATBS) in
the world. ATBS is a specialty monomer with several
applications including the manufacture of acrylic
fibers, personal care products, water treatment
chemical, enhanced oil recovery chemical. VOL began

Mgt expects VOL to be the key driver over the next

two years driven by capacity expansion and robust
demand from enhanced oil recovery (EOR). ATBS is
used an important ingredient to manufacture
polymers for enhanced oil recovery (EOR). VOL has
expanded ATBS capacity from 12,000 in FY12 to
26,000 FY13-14. VOL expects this incremental
addition in capacities will add ~Rs 2.0bn revenues
over the next two years. Moreover, ATBS market is
expanding at ~15% CAGR globally which adds to
revenue visibility for VOL.

Page | 3

VINATI ORGANICS : VISIT NOTE

PRODUCTWISE REVENUES
In Rs mn
IBB
YoY %
ATBS
YoY %
IB
YoY %
Others
YoY %

FY09
1116
9.9%
744
39.0%
0
0.0%
98
47.4%

FY10
1227
9.9%
1034
39.0%
0
0.0%
144
47.4%

FY11
1078
-12.2%
1861
79.9%
131
0.0%
196
35.8%

FY12
1801
67.1%
2161
16.1%
360
175.8%
180
-8.1%

FY13
2394
32.9%
2282
5.6%
557
54.5%
334
85.4%

FY14
2436
1.8%
2854
25.0%
905
62.6%
766
129.2%

Sources : Company, HDFC sec Inst Research

VOL to focus on de-concentrating revenues

Though VOL expects ATBS to remain a key growth

driver over the next two years and expects ATBS to
remain a large contributor to revenues, mgt is also
simultaneously looking to de-concentrate its product
basket. Mgt expects its non-core products (curr
~10% of revenues) to con tribute ~20% by FY16E.
Moreover, VOL is also focusing on introducing new
products by FY16-17E which will further deconcentrate revenues.

Resilient EBIDTA margins

VOL enjoys highest profitability compared to peers

led by stringent focus on cost efficiency. Though VOL
exports ~80% of revenues and is also prone to crude
fluctuations (ATBS cost are linked to crude), company
contracts with customers safeguards from these
fluctuations. VOLs pass through arrangement with
customers also restricts benefits from favorable
crude prices and currencies.
ATBS has the highest profitability (~30%) followed by
IBB (~25%) and IB (~15%). As ATBSs contribution to
revenues increases, we expect EBIDTAM to witness
expansion over FY14-16E.

Page | 4

VINATI ORGANICS : VISIT NOTE

7,000

40.0

60

6,000

35.0

50

30.0

5,000

25.0

4,000
3,000
2,000

30

15.0

20
10
0

FY09

FY14

FY13

FY12

0.0

FY11

FY10

5.0

FY09

1,000

EBIDTA margins

40

20.0
10.0

Gross margins

Sources : Company, Industry, HDFC sec Inst Research

Sources : Company, Industry, HDFC sec Inst Research

VOL has maintained its cash conversion cycle ~80 days

Lower asset turns led to dip in return ratios

Inventory days
No.

Recv days

Payable days

45

Rs mn.

RoCE

RoE

40

70

35

60

30

50

25

40

20

30

Sources : Company, HDFC sec Inst Research

FY14

FY13

FY12

FY09

FY14

FY13

FY12

FY11

FY10

FY09

10

10

FY11

15

20

FY10

80

FY14

45.0

FY13

Rs mn.

70

FY12

8,000

growth (%) - RHS

FY11

Revenue

EBIDTAM margins have remained steady ~22%

FY10

Revenues have grown at 20% CAGR over FY09-14

Sources : Company, HDFC sec Inst Research

Page | 5

VINATI ORGANICS : VISIT NOTE

QUARTERLY FINANCIALS - SNAPSHOT
(Rs mn)

1QFY14

2QFY14

3QFY14

4QFY14

1QFY15

YoY (%)

QoQ (%)

1,479

1,749

1,702

1,943

1,961

32.6

0.9

Material Expenses

901

978

1,065

1,245

1,281

42.1

2.9

Other Operating Expenses

299

301

227

189

218

(27.3)

14.9

67

70

70

67

80

18.7

19.7

211

400

339

443

383

81.3

(13.6)

45

22

59

22

(51.3)

134.7

Net Revenues

Employee expenses

VOL repaid debt (~Rs 750mn) in

FY14 which led to lower interest
outgo

Operating income
Other operating income

256

422

398

452

405

58.0

(10.5)

Other Income

17

18

22

35

22

30.2

(38.7)

Depreciation

36
48

37

40

40

43

18.4

9.2

49

43

42

25

(46.9)

(39.5)

PBT

189

354

337

406

358

89.8

(11.9)

Tax

62

127

105

130

117

88.2

(10.2)

127

227

232

276

241

90.5

(12.7)

1QFY14

2QFY14

3QFY14

4QFY14

1QFY15

YoY (bps)

QoQ (bps)

Material Exp as % of Net Sales

60.9

55.9

62.6

64.0

65.3

437

127

Employee Exp as % of Net Sales

4.5

4.0

4.1

3.4

4.1

(48)

64

Other Operating Exp as % of Net Sales

20.2

17.2

13.3

9.7

11.1

(914)

135

Operating Margin (%)

14.3
16.8

22.9

19.9

22.8

19.5

524

(327)

23.8

22.6

23.2

20.4

360

(275)

8.6

13.0

13.6

14.2

12.3

374

(191)

32.9

36.0

31.2

32.0

32.6

(27)

62

EBIDTA

Interest expense
Exceptional items

RPAT
Sources : Company, HDFC sec Inst Research

MARGIN ANALYSIS

EBIDTA margins remain lumpy

between quarters due to
product mix change

EBITDA Margin (%)

RPAT Margin (%)
Tax Rate (%)
Sources : Company, HDFC sec Inst Research

Page | 6

VINATI ORGANICS : VISIT NOTE

Outlook and Valuation

Risks and concerns

VOL has grown at a healthy CAGR of ~35% over FY0614 largely driven by exports which posted a CAGR of
~55%, whereas domestic revenues have grown at
~25%. EBIDTA margins have shown a steady
expansion from ~11% in FY06 to ~23% in FY14 led by
both gross margin expansions as well better
operating leverage.

Highly concentrated product basket : VOLs high

dependence in two products (IBB and ATBS - `76% of
revenues) may cause a threat to revenues and
profitability. However, VOL has started focusing on
increasing product basket and also expects IBB
contribution to slide in the overall pie. ATBS, though,
is expected to remain a significant contributor.

Going ahead management expects ~20% CAGR in

revenues over the next 2-3 years driven by ATBS and
IB. Growth post FY17 will be driven by addition of
new products. VOLs contracts with the customers
safeguards against exchange fluctuations and crude
price impact, hence VOL has guided for steady
EBIDTA margins at ~23% levels over the next 2-3
years. We expect slight improvement in EBIDTA
margins in FY15E/16E driven by higher revenue
contribution from ATBS (ATBS is a higher margin
product compared to IBB).

Client concentration : VOL is highly dependent on its

top 5 customers for IBB as well as ATBS as they
account ~50% of revenues. For IBB major customers
include Shasun, Perrigo and BASF Germany. For
ATBS, BASF, NALCO, Clariant are amongst the large
buyers. Any adverse event at customers end or lower
demand from these large customers can have a
significant impact on revenues.

Anti dumping or any other regulatory concern : VOL

derives ~75% of its revenues from export. The key
markets include US, EU, China and SEA . Imposing of
anti-dumping duties from any of the concerned
markets can impact VOLs financials.

Huge capex : VOL incurred a huge capex in FY12-13,

to double its ATBS capacity from 12,000 tpa to 26,000
tpa (funded by debt) which led to a sharp increase in
D/E ratio from 0.5x in FY11 to 1.0x in FY13. Though
VOL has guided for a capex of Rs 1.5bn over the next
18 months, any incrementally huge capex could lead
to increase in debt which may impact the valuations.

VOL has a strong balance sheet with Net D/E OF 0.4x

and a restricted cash conversion cycle of ~77 days.
VOL has also started generating free cash flows from
FY14 (Rs 995mn) and is expected to generate positive
free cash flows (given the capex guidance of Rs
1.5bn) and steady working capital requirements.
VOL commands premium over peers due to its best in
class return ratios (ROE of ~28%, ROCE of ~21%) and
strong growth visibility. VOL currently trades at ~14x
FY16E (Bloomberg est.) EPS of Rs 29. The stock is
currently NOT RATED by us.

Page | 7

VINATI ORGANICS : VISIT NOTE

PEER VALUATION

Vinati

EPS

P/E

EV/EBIDTA

RoE (%)

CMP
(Rs)

Mcap
(Rs bn)

FY13

FY14

FY15E

FY16E

FY13

FY14

FY15E

FY16E

FY13

FY14

FY15E

FY16E

FY13

FY14

FY15E

FY16E

403

20.0

13.9

17.5

23.1

29.3

29.0

23.1

17.4

13.7

17.7

13.0

11.3

9.0

32.1

31.3

31.8

30.5

Omkar spe

145

2.8

10.5

6.9

8.3

10.0

13.9

21.0

17.6

14.5

11.4

10.7

8.4

6.3

17.7

10.3

11.3

12.4

Atul Ltd

1285

38.0

40.4

73.9

84.9

103.0

31.8

17.4

15.1

12.5

16.9

11.4

9.6

8.1

17.1

25.7

24.1

24.4

Aarti Ind

294

26.0

15.2

18.3

22.9

30.8

19.4

16.0

12.8

9.6

9.7

8.8

7.2

5.9

20.0

20.0

20.7

24.3

Sources : Company, HDFC sec Inst Research, Bloomberg estimates

One yr fwd PE chart

18.00

PE

Avg PE

16.00
14.00
12.00
10.00
8.00
6.00
4.00
2.00
Feb-14
Apr-14
Jun-14
Aug-14

Feb-13
Apr-13
Jun-13
Aug-13
Oct-13
Dec-13

Feb-12
Apr-12
Jun-12
Aug-12
Oct-12
Dec-12

Feb-11
Apr-11
Jun-11
Aug-11
Oct-11
Dec-11

Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10

Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09

Apr-08
Jun-08
Aug-08
Oct-08
Dec-08

0.00

Sources : Company, HDFC sec Inst Research

Page | 8

VINATI ORGANICS : VISIT NOTE

Company Background

VOL was promoted by Maharashtra Petrochemical

Corporation (MPCL) and Vinati Enterprises- a
partnership firm of Vinod Saraf in Jun-89 as a
specialty organic chemicals focused company. It
started with the manufacturing of isobutyl benzene
(IBB) - the prime raw material for ibuprofen - a NSAID
drug. VOL came out with a public issue in Nov-91 for
the manufacture of 1,200tpa of IBB at Mahad,
Raigad. Commercial production commenced in Jul-92.
The company has gradually increased the capacity of
IBB to 16,000tpa. VOL has technical collaboration
with Institute Francais Petrole (IFP) for petrochemical
processes and catalyst. In 2000, VOL acquired 22 acre
land at Lote Parsuram for Rs15mn. It is then when
VOL started focusing on 2-acrylamido -2methylpropane sulphonic acid (ATBS) with an
installed capacity of <2000tpa, as of date VOL has
installed capacity of 26,000tpa for ATBS. ATBS is used
in industrial water treatment, oil recovery and
construction chemicals. VOL is the worlds largest
manufacturer of IBB and ATBS. The company
manufactures isobutylene (IB) a key intermediate in
the manufacture of ATBS. IB is used in the
manufacture of agrochemicals and anti-oxidants. VOL
total product basket includes 14 products (inclusive
of top 3 products). VOL exports its products to 22
countries.

Key management team

Mr Vinod Saraf, Managing director : The founder of

VOL, is an MBA from BITS Pilani and has thorough
knowledge of specialty chemicals. Prior to starting
his own venture, Mr. Saraf worked for about 25 years
in the textile and petrochemical industry.

Ms Vinati Saraf Mutreja, Executive director : An

experienced financial consultant, having worked for
leading companies in New York, USA, before she
joined VOL in 2006. She has completed a dual degree
in Bachelors of Science in Economics (Finance) from
The Wharton School and Bachelors in Applied
Science, Biotech and Pharmaceutical Development
from the School of Engineering and Applied Sciences
from University of Pennsylvania.

Ms. Viral Saraf Mittal, Director corporate strategy :

She has rich experience of working with organizations
like Citi Bank and Ernst and Young. She became a part
of VOL in 2009. She holds a Bachelors of Science
degree in Economics (Finance and Management)
from The Wharton School, University of
Pennsylvania.

Page | 9

VINATI ORGANICS : VISIT NOTE

INCOME STATEMENT

BALANCE SHEET

Year ending March (Rs mn)

FY10

FY11

FY12

FY13

FY14

Year ending March (Rs mn)

Net Sales

2,318

3,226

4,475

5,529

6,961

SOURCES OF FUNDS

Growth (%)

21.7

39.2

38.7

23.6

25.9

1,328

1,834

2,677

3,351

4,188

Employee Expenses

115

149

183

226

Other Operating Expenses

347

546

665

748

Operating Profits

527

697

950

1,203

1,529

Long Term Debt

Operating Profit Margin (%)

22.7

21.6

21.2

21.8

22.0

Short Term Debt

84

64

28

38

92

Material Expenses

Other Operating Income

Share Capital

FY11

FY12

FY13

FY14

99

99

99

99

99

Reserves

893

1,338

1,772

2,314

3,002

274

Total Shareholders Funds

992

1,437

1,870

2,412

3,101

970

Minority Interest

570

417

1,108

1,720

1,493

61

353

619

653

123

631

770

1,727

2,373

1,616

87

117

149

261

331

1,710

2,324

3,746

5,046

5,048

Net Block

796

1,112

1,443

2,901

3,042

CWIP

384

360

567

140

101

32

79

128

27

Inventories

189

350

430

546

466

359

519

857

1,132

1,151

18

20

320

338

453

Total Debt

EBIDTA

612

761

978

1,241

1,621

EBIDTA (%)

26.4

23.6

21.9

22.4

23.3

Long Term Provisions & Others

EBIDTA Growth (%)

55.6

24.4

28.6

26.9

30.6

TOTAL SOURCES OF FUNDS

Other Income

FY10

Deferred Taxes

APPLICATION OF FUNDS

50

64

70

99

153

562

696

908

1,141

1,467

44

71

92

115

181

PBT

518

625

816

1,026

1,286

Tax

118

105

268

339

424

Debtors

PAT

400

520

548

687

862

Cash & Equivalents

PAT Growth (%)

59.3

29.8

5.5

25.3

25.5

ST Loans & Advances, Others

106

185

350

271

281

8.1

10.5

11.1

13.9

17.5

Total Current Assets

671

1,075

1,956

2,287

2,351

59.3

29.8

5.5

25.3

25.5

Creditors

57

119

89

156

142

Depreciation
EBIT
Interest

EPS
EPS Growth (%)

Source: Company, HDFC sec Inst Research

Investments, LT Loans & Advances

Other Current Liabilities & Provns

84

135

211

254

331

Total Current Liabilities

141

254

299

410

473

Net Current Assets

530

820

1,657

1,877

1,878

1,710

2,324

3,746

5,046

5,048

Misc Expenses & Others

TOTAL APPLICATION OF FUNDS
Source: Company, HDFC sec Inst Research

Page | 10

VINATI ORGANICS : VISIT NOTE

CASH FLOW
Year ending March (Rs mn)
Reported PAT
Non-operating & EO items

KEY RATIOS
FY10

FY11

FY12

FY13

FY14

400

520

548

687

862

FY10

FY11

FY12

FY13

FY14

PROFITABILITY (%)

65

53

19

25

61

GPM

57.3

56.8

59.8

60.6

60.2

335

467

529

661

800

EBITDA Margin

26.4

23.6

21.9

22.4

23.3

Interest expenses

44

71

92

115

181

APAT Margin

17.3

16.1

12.2

12.4

12.4

Depreciation

50

64

70

99

153

RoE

40.4

36.2

29.3

28.5

27.8

(195)

(288)

(537)

(202)

114

ROIC

25.4

24.9

16.3

15.1

19.5

25.7

25.1

17.8

16.2

21.4

22.7

16.9

32.8

33.1

33.0

1.4

1.4

1.2

1.1

1.4

Inventory (days)

29.8

39.6

35.1

36.1

24.5

PAT from Operations

Working Capital Change

OPERATING CASH FLOW ( a )

234

314

155

675

1,249

RoCE

Capex

(348)

(357)

(609)

(1,131)

(254)

EFFICIENCY

Free cash flow (FCF)

(115)

(42)

(454)

(456)

995

Tax Rate (%)

(32)

(47)

(49)

100

Asset Turnover (x)

(348)

(388)

(656)

(1,179)

(154)

Investments
INVESTING CASH FLOW ( b )
Share capital Issuance

Debtors (days)

56.5

58.7

69.9

74.7

60.3

Debt Issuance

122

138

957

646

(757)

Payables (days)

9.0

13.5

7.2

10.3

7.4

Other long term liabilities

(44)

(71)

(92)

(115)

(181)

Cash Conversion Cycle (days)

29

30

32

112

70

(58)

(75)

(115)

(144)

(173)

Interest expenses
Dividend
FINANCING CASH FLOW ( c )

77.3

84.9

97.7

100.5

77.3

Debt/EBITDA (x)

1.0

1.0

1.8

1.9

1.0

Net D/E

0.6

0.5

0.8

0.8

0.4

12.7

9.8

9.9

9.9

8.1

48

23

782

498

(1,041)

Interest Coverage

(66)

(51)

281

(7)

54

PER SHARE DATA

Non-operating and EO items

65

53

19

25

61

EPS (Rs/sh)

8.1

10.5

11.1

13.9

17.5

Closing Cash & Equivalents

18

20

320

338

453

CEPS (Rs/sh)

9.1

11.8

12.5

15.9

20.6

DPS (Rs/sh)

1.0

1.3

2.0

2.5

3.0

BV (Rs/sh)

20.1

29.1

37.9

48.9

62.8

P/E

49.7

38.3

36.3

29.0

23.1

P/BV

20.1

13.9

10.6

8.3

6.4

EV/EBITDA

33.6

27.2

21.8

17.7

13.0

NET CASH FLOW (a+b+c)

Source: Company, HDFC sec Inst Research

VALUATION

OCF/EV (%)

1.1

1.5

0.7

3.1

5.9

FCF/EV (%)

(0.6)

(0.2)

(2.1)

(2.1)

4.7

FCFE/EV(%)

(0.8)

(0.6)

(2.7)

(2.9)

4.1

0.2

0.3

0.5

0.6

0.7

Dividend Yield (%)

Source: Company, HDFC sec Inst Research

Page | 11

VINATI ORGANICS : VISIT NOTE

Rating Definitions
BUY

Where the stock is expected to deliver more than 10% returns over the next 12 month period

NEUTRAL

Where the stock is expected to deliver (-)10% to 10% returns over the next 12 month period

SELL

Where the stock is expected to deliver less than (-)10% returns over the next 12 month period

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