- A MicroCap CO which has good scope of growth, with a good financial track record
- Ace investor Ashish Kacholia bought stake in the recent quarter in this CO 💰
MEGASTAR FOODS LTD.
[A brief SWOT analysis] 🧵🧵
#investing #StocksToBuy #finance
(1/19)
- Ace investor Ashish Kacholia bought stake in the recent quarter in this CO 💰
MEGASTAR FOODS LTD.
[A brief SWOT analysis] 🧵🧵
#investing #StocksToBuy #finance
(1/19)
We will analyze: 👇🏻
- BACKGROUND
- MANAGEMENT
- PRODUCTS & MANUFACTURING CAPACITY
- MARKETS & CUSTOMERS:
- STRENGTHS
- THREATS
- COMPANY’S FINANCIALS
(2/19)
- BACKGROUND
- MANAGEMENT
- PRODUCTS & MANUFACTURING CAPACITY
- MARKETS & CUSTOMERS:
- STRENGTHS
- THREATS
- COMPANY’S FINANCIALS
(2/19)
BACKGROUND:
Incorporated in 2011, MFL processes wheat to produce Maida, suji, atta, and bran at its unit in Chandigarh, which has capacity of 300 tonne per day.
CO was listed on the Bombay Stock Exchange in fiscal 2019. 📈
(3/19)
Incorporated in 2011, MFL processes wheat to produce Maida, suji, atta, and bran at its unit in Chandigarh, which has capacity of 300 tonne per day.
CO was listed on the Bombay Stock Exchange in fiscal 2019. 📈
(3/19)
MANAGEMENT:
Promoted by Mr Vikas Gupta, Mr Vikas Goel, and Mr Pankaj Goel.
(4/19)
Promoted by Mr Vikas Gupta, Mr Vikas Goel, and Mr Pankaj Goel.
(4/19)
PRODUCTS & MANUFACTURING CAPACITY:
CO's main line of business is milling wheat to produce types of wheat flours, suji/rava and wheat bran.
MFL’s plant is located at Chandigarh with a warehousing capacity of 15000 MT and manufacturing capacity of 9000 MT per month. 💪🏻
(5/19)
CO's main line of business is milling wheat to produce types of wheat flours, suji/rava and wheat bran.
MFL’s plant is located at Chandigarh with a warehousing capacity of 15000 MT and manufacturing capacity of 9000 MT per month. 💪🏻
(5/19)
It also has 10,000 MT wheat grains in house storage capacity, 200 MT wheat grains crushing capacity and 100 MT chakki plant capacity.
CO has the most modern wheat processing plant in Northern India and the only plant in Punjab equipped with latest Buhler machinery ✅
(6/19)
CO has the most modern wheat processing plant in Northern India and the only plant in Punjab equipped with latest Buhler machinery ✅
(6/19)
MARKETS & CUSTOMERS:
Megastars food ltd mainly offer products to MNC’s in India and export is relatively low when compared to the domestic sales.
The management of the company is trying to shift its focus on the growth of international business. 🌍
(7/19)
Megastars food ltd mainly offer products to MNC’s in India and export is relatively low when compared to the domestic sales.
The management of the company is trying to shift its focus on the growth of international business. 🌍
(7/19)
Domestic sales accounts to 97% of total sales while exports accounts to 3%. ✅
CO enjoys a reputed client base, some of the key clients of the company are Nestle, ITC, Sunfeast, Domino’s, Horlicks, Pizza Hut, KFC, PepsiCo, Mondelez, Oreo, United Nations among others.
(8/19)
CO enjoys a reputed client base, some of the key clients of the company are Nestle, ITC, Sunfeast, Domino’s, Horlicks, Pizza Hut, KFC, PepsiCo, Mondelez, Oreo, United Nations among others.
(8/19)
STRENGTHS:
The Company has well- equipped automated plant which gives the opportunity to attract Multinational Companies and Corporate buyers as they get the best quality products as per food standards. 🎯
(9/19)
The Company has well- equipped automated plant which gives the opportunity to attract Multinational Companies and Corporate buyers as they get the best quality products as per food standards. 🎯
(9/19)
Due to various Certifications the Company also get opportunity to get bulk orders from Corporate as these ensure that the Company is meeting food quality standards that are required by them. ✅
(10/19)
(10/19)
The Company has hedge over other competitors due to procurement of raw material in large quantity i.e., best quality at minimum cost. 💲
(11/19)
(11/19)
THREATS: ⚠
From war to heatwaves and floods to drought, wheat is under attack and is getting more expensive day by day. India was seen as a collateral beneficiary after the Russia-Ukraine war, but bread became more costly after a ban on its global sales.
(12/19)
From war to heatwaves and floods to drought, wheat is under attack and is getting more expensive day by day. India was seen as a collateral beneficiary after the Russia-Ukraine war, but bread became more costly after a ban on its global sales.
(12/19)
But this price change is working differently in the Indian domestic market. 📈
India exported nearly six times more wheat in April than last year in the same month. In May, wheat exports are likely to decrease as wheat exports have been limited by the GOI.
(13/19)
India exported nearly six times more wheat in April than last year in the same month. In May, wheat exports are likely to decrease as wheat exports have been limited by the GOI.
(13/19)
This has affected the CO's export business.
There are various other threats to the CO such as the market Competitors, which indulge in cost cutting of the product, which forces the CO to sell its product as low cost and affects the profitability of the company. 💲⬇
(14/19)
There are various other threats to the CO such as the market Competitors, which indulge in cost cutting of the product, which forces the CO to sell its product as low cost and affects the profitability of the company. 💲⬇
(14/19)
This also led to loss to the Company.
On the other hand, Company’s raw material is based on agro product which is affected by natural calamities and geopolitical tensions, which deteriorate the quality of the product, which is the major threat to the CO. ⚠🚩
(15/19)
On the other hand, Company’s raw material is based on agro product which is affected by natural calamities and geopolitical tensions, which deteriorate the quality of the product, which is the major threat to the CO. ⚠🚩
(15/19)
COMPANY’S FINANCIALS:
The company has a market capitalization of Rs 273 Crores.
CO’s stock P/E is 43.7 compared to industry’s P/E 61. Company’s EV/EBIT ratio is 26.8 and company’s OPM is 6.85%. CO has delivered good profit growth of 38.1% CAGR over last 5 years. ✅
(16/19)
The company has a market capitalization of Rs 273 Crores.
CO’s stock P/E is 43.7 compared to industry’s P/E 61. Company’s EV/EBIT ratio is 26.8 and company’s OPM is 6.85%. CO has delivered good profit growth of 38.1% CAGR over last 5 years. ✅
(16/19)
Also Mr. Ashish Kacholia considered as 'Big Whale' of Indian stock market has added Megastar Foods in its portfolio during July to September 2022 quarter. 💯
(17/19)
(17/19)
And, that's a wrap.
If you liked the analysis, make sure to like and retweet the first tweet to show support and share with maximum investors! ♻
Do share your views on this CO in the comments below. 📩
(18/19)
If you liked the analysis, make sure to like and retweet the first tweet to show support and share with maximum investors! ♻
Do share your views on this CO in the comments below. 📩
(18/19)
Disclaimer: This twitter thread is for educational and knowledge sharing purposes only. We are not associated with the company in any form. This is not a buy/sell/hold recommendation of any kind. Kindly consult with your financial advisor before taking any actions.
(19/19)
(19/19)
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