Atul Ltd

Atul Ltd, in Feb’16 announced that it had picked up an additional 49%  stake in Anchor Adhesives Pvt Ltd (owner of the Polygrip brand) for a cash consideration of Rs.80 lakh. It increased the stake in the resins and adhesives manufacturer to 98.99%,  making it a subsidiary of Atul. That news apart, there was really nothing during the entire Q4, at least till now which propped up or brought the stock price down.

Its performance for Q3FY16 was good mainly on account of lower costs. Net sales was down 4% (YoY) at Rs.592 crore but costs came down 5%, led by a 9% drop in raw material costs and 11% decline in power, fuel and water expenses. This helped shore up the EBITDA to Rs.104 crore, up 11% while margins improved from 15.2% to 17.5%. Net profit for the quarter was up 13% at Rs.61 crore.

The company currently has a debt of around Rs.290 crore. And of the 50.83% stake of the promoters, 12.14% is pledged.  The good news – it will end FY16 on a higher note as its net profit for 9MFY16 at Rs.205 crore is already almost 95% of entire FY15 net profit of Rs.217 crore.