Fine Organic Industries Ltd - Fine company
A fine stock if you can stomach volatility in performance
Company Overview
Fine Organic Industries Ltd is a leading producer of oleochemical derivatives. Established in 1971, it has a portfolio of over 450 products, derived from all natural plant-based oils and oleochemicals. It is a leading producer of additives for foods, polymers, cosmetics, coatings etc. It has 5000 end-users across more than 70 countries.
Share Details
NSE:FINEORG
Closing Price = 5064 (8-Jun-23)
52 Week High = 7328.75 (45% above closing price)
52 Week Low = 4040 (20% below closing price)
P/E = 25
Market Cap = 15,522 cr ( ~$ 1.9 bn)
Quality: Returns on capital employed in cash
A PAT of 15% and return ratios of 20%+ over the seven years of its listing inspires a lot of confidence in the ocmpany to execute efficiently.
Growth
Growth has been good at 25% topline growth, one can see the company doubling, tripling from its current size. It creates and opportunity in the stock.
The PAT and Free cash flow (FCF) growth being higher than the revenue growth confirms that the company is growing profitably
So What????
If I own the stock, I will hold on it and hope to keep it for a few years assuming similar kind of company performance as seen in the last 7 years since listing.
If I don’t own the stock, I would like to enter it. Its available at a PE of 25 and is trading 31% below its 52 week high.
Disclaimer
It is an analysis of the company data and not a stock recommendation
My analysis can be completely wrong and can change the next minute based on changes in my understanding of the company
I look to own good companies at prices where there is a path to market beating returns over decades