Ion Exchange

This company is a pioneer in the sector of water management and in today’s time, this is one sector which has immense potential for the future. Despite being in such a lucrative sector, the stock never really caught much fancy because the market was not happy with the promoters, who held private companies in the same sector, creating a conflict of interest. Even now, the consolidated numbers show that there are 14 companies included. But the biggest privately held company – Ion Exchange Services Ltd has now been amalgamated into Ion Exchange. The management seems to be getting proactive and is trying its best to breathe life back into its flagship consumer water purifying product – Zero B. It could have sustained the first mover advantage had it not allowed the likes of Pure It and Aqua Guard to take over completely.

The company did well in Q4FY13 but the performance is more muted in Q1FY14 as seasonally, Q1 is usually slow and Q4 is usually the best. YoY, net sales rose 6% at Rs.155 crore and net profit was at Rs.4 crore, up 5%. In terms of segmental break up, its engineering segment remains its bread winner, contributing 56% to the topline. It is followed by chemicals, which contributes 37%% and consumer products is at 13%. In terms of shareholding, as at end of FY13 promoters held 40.60%. Rakesh Jhunjhunwala holds 6.44% stake.  Reserves stands at Rs.136 crore.