IG Petrochemicals

Organic chemicals maker IG Petrochemicals reported healthy number for Q1FY16, with revenues at Rs. 284 crore and operating profit of Rs. 43 crore, thanks to lower material costs. Finance cost has also reduced during the quarter at Rs. 7 crore, versus Rs. 9 crore and Rs. 10 crore in Q4FY15 and Q1FY15 respectively, boosting net profit to Rs. 29 crore (10% net margin), despite higher MAT outgo. Its first quarter EPS of Rs. 9.51 fares well in relation to EPS of Rs. 10.51 clocked during 10.51.

Company, a market leader in Phthalic Anhydride (PAN), has been witnessing a lot of action on the bourses. In a run-up to the results, share had made a new 52 week high of Rs. 134.80 on NSE yesterday. But today, profit booking has led to the script being down 5% at 114. Currently, share is attractively priced. With current market cap of Rs. 346 crore, company has annual net profit run-rate of Rs. 116 crore, indicating a PE multiple of just 3 times. It net debt, as of 31-03-15, stood at Rs. 110 crore on networth of Rs. 239 crore.