Rallis India - Promising Agriculture Play
Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Stock Synopsis
Forum Discription: A bried discussion of companies on very specific matters. Normally this is the prelude for further research as always members would be discussing quality companies with good management only
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=2237
Printed Date: 21/Apr/2025 at 1:32am
Topic: Rallis India - Promising Agriculture Play
Posted By: SingleMalt
Subject: Rallis India - Promising Agriculture Play
Date Posted: 15/Jul/2009 at 7:42pm
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Can this post be moved to stock synopsis thread? Thanks.
In these times, if there is a stock that is making new all time highs, I believe it is worth a second look. Rallis
MCap 890 cr., EPS 60, ROE ~ 25.5, CMP 742, all time high 785 (today) 1) Rallis India, a TATA company, is a leading agrochem player involved in the manufacture, trade and export of agrochemicals, plant growth nutrient, seeds and seed chemicals. 2) With a view to de-risk the business from seasonality, Rallis has started to focus on exports. Exports constitute 24% of sales, and is expected to contribute 40% of sales in 2-3 years. I got this from Hitesh Shah’s post that contained analyses from Geojit ( http://www.theequitydesk.com/forum/forum_posts.asp?TID=2090&KW=Rallis+India - http://www.theequitydesk.com/forum/forum_posts.asp?TID=2090&KW=Rallis+India ) 3) Rallis is 150 years old company and has surplus assets held for disposal having book value of Rs. 8.22 crore (as on March 31, 2008). In addition to that, company has over and above 150 acres of land in 4) Rallis is known for its manufacturing capabilities in crop protection chemicals and various types of chemistries with ability to develop new processes & formulations supported by capability to register new products 5) It has contract manufacturing alliances with several multinational agrochemical companies like FMC, Nihon Nohyaku, DuPont, Syngenta, Makhteshim Chemical Works, Bayer, Borax International, etc., for bringing in new molecules and new formulation technologies for commercialization. 6) Rallis has 25% stake in contract research firm Advinus Therapeutics-Bangalore (Formerly R&D division of Rallis). Advinus has commenced US operations. Advinus is JV between Tata Sons and Rallis engaged in high value research in partnership with global MNCs for kala azar, neglected diseases and unidentified targets in pharma sector that can create great value for Rallis. ------------- If only I knew then what I know now... |
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Replies:
Posted By: Hitesh Shah
Date Posted: 15/Jul/2009 at 8:20pm
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Rallis is such a company that one needn't look at it frequently, unless it is to add more.
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Posted By: SingleMalt
Date Posted: 15/Jul/2009 at 8:53pm
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http://www.livemint.com/2009/07/14202119/Value-addition-enables-Rallis.html - http://www.livemint.com/2009/07/14202119/Value-addition-enables-Rallis.html
Mumbai: Rallis India Ltd, the agro care company of Tata group, more than doubled its net profit for the quarter ended 30 June at Rs9 crore compared to Rs4 crore a year ago. The company posted Rs163 crore in sales for the quarter. .
Rallis’ managing director V Shankar said the company’s performance for the quarter was driven mainly by its enterprise-wide value creation programme that was initiated a year ago to add value to business through strategic expansion at rationalized costs. ------------- If only I knew then what I know now... |
Posted By: SingleMalt
Date Posted: 18/Jul/2009 at 12:05pm
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http://business.rediff.com/slide-show/2009/jul/16/slide-show-1-secret-behind-advinus-success.htm - http://business.rediff.com/slide-show/2009/jul/16/slide-show-1-secret-behind-advinus-success.htm
A positive write-up about Advinus... A Rallis/Tata Sons joint venture. ------------- If only I knew then what I know now... |
Posted By: SingleMalt
Date Posted: 21/Jul/2009 at 6:39pm
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Company Review: Rallis India by Angel Broking
from http://www.livemint.com/2009/07/21091301/Company-Review-Rallis-India.html - http://www.livemint.com/2009/07/21091301/Company-Review-Rallis-India.html
Rallis India (RAIL), a Tata Group company, is the second largest player in the domestic Pesticide market. The company had undertaken a restructuring exercise post FY2004, which resulted in RAIL clocking all-time high EBITDA Margins in FY2009.
Going ahead, we expect Contract Manufacturing (CM) to drive the company’s next level of growth particularly with its new plant coming on stream by June 2010.
We estimate RAIL to register a CAGR of 14% and 24.3% in Net Sales and Profit over FY2009-11E, respectively.
At Rs735, the stock is trading at 8.9x FY2011E Earnings and 5.4x FY2011E EV/EBITDA. Historically, RAIL has traded in the 3-11x one-year forward PE band, and at an average 8x over the last couple of years.
Going ahead, on account of improving Return Ratios and higher Net Profit growth, we expect the stock to trade at higher valuations than its historical average.
We initiate coverage on the stock with an ACCUMULATE rating and target price of Rs796. ------------- If only I knew then what I know now... |
Posted By: Vivek Sukhani
Date Posted: 22/Jul/2009 at 8:34pm
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SingleMalt, you may also look at Bayer Cropsciences....if GM seeds manage to set its feet in India in a big way, this company will be a scorcher ------------- Jai Guru!!! |
Posted By: mahesh004
Date Posted: 23/Jul/2009 at 3:27pm
| you may want to look at United Phosphorous to understand how to evaluate Rallis. Rallis can be atleast tomorrow's United Ph. |
Posted By: SingleMalt
Date Posted: 27/Jul/2009 at 12:40pm
------------- If only I knew then what I know now... |
Posted By: SingleMalt
Date Posted: 27/Jul/2009 at 12:42pm
 ------------- If only I knew then what I know now... |
Posted By: prabhakarkudva
Date Posted: 02/Aug/2009 at 12:06pm
| Is rallis trading at a PEG < 1. I am not sure why the PE is still quite decent(low,i think TTM PE is around 12) inspite of the good results that the company is showing. |
Posted By: Crimsonarcher
Date Posted: 09/Aug/2009 at 11:16am
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This was available at 250 Rs about 3 months back, when RJ increased holdings in this. I think this is both a turnaround case, as also benefitting from the govt's debt write off to farmers last year. the 60K Cr writeoff, would lead to farmers re-investing in the coming years for higher crop yields which would have a trickle down benefit to companies in the agricultural/fertiliser/seeds/pesticides space.So have to see how the earnings play out in the coming years, but its a great buy with high EPS, Low P/E and high dividend yields. |
Posted By: tigershark
Date Posted: 12/Aug/2009 at 10:29pm
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tata chem to purchase upto 35% of rallis shares from other tata cos at a price not more than 850...announced today at tchem board meeting www.bseindia.com
------------- understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things |
Posted By: SingleMalt
Date Posted: 12/Aug/2009 at 10:55pm
http://www.equitybulls.com/admin/news2006/news_det.asp?id=59241 - http://www.equitybulls.com/admin/news2006/news_det.asp?id=59241 ------------- If only I knew then what I know now... |
Posted By: Hitesh Shah
Date Posted: 12/Aug/2009 at 11:16pm
But what could be the reasoning here? ------------- |
Posted By: FutureBull
Date Posted: 12/Aug/2009 at 11:48pm
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i think Tata Grp is consolidating all chem business at one place.. lots of restructuring happening here.. ------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |
Posted By: SingleMalt
Date Posted: 12/Aug/2009 at 2:17am
A potential merger? Lets wait and watch...
http://economictimes.indiatimes.com/stocks-in-news-home/Tata-Chem-to-increase-stake-in-Rallis-/articleshow/4887617.cms - http://economictimes.indiatimes.com/stocks-in-news-home/Tata-Chem-to-increase-stake-in-Rallis-/articleshow/4887617.cms
.... “Tata Chemicals has a strong presence in crop nutrition business, and Rallis is among the leaders in crop protection business in agri-sector”, the statement said without divulging the rationale for the move. Industry sources said the move might be a precursor for merger of Rallis with Tata Chemicals. “Both the companies have operational synergies and hence, it makes sense to have only one merged entity,” said an analyst, requesting anonymity. The Tata Chemicals spokesperson declined to comment. In addition to fertilisers, Tata Chemicals is the world’s second-largest soda ash company, and the country’s largest branded salt maker. The Rallis stock gained 6.8% to close at Rs 736.95 in a weak Mumbai market on Wednesday. ------------- If only I knew then what I know now... |
Posted By: Hitesh Shah
Date Posted: 13/Aug/2009 at 5:04pm
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http://www.moneycontrol.com/mccode/news/article/news_article.php?autono=411038&special=mkt_topnews - Here 's a little more on the Rallis - Tata Chem matter.
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Posted By: subu76
Date Posted: 13/Aug/2009 at 5:14pm
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Not sure if it's already called out...
These two companies have had a long relationship.
Tata Chem was one of the Tata companies which bailed out Rallis when it was undergoing debt restructuring.
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Posted By: Hitesh Shah
Date Posted: 14/Aug/2009 at 5:19pm
http://moneycontrol.com/mccode/news/article/news_article.php?autono=411255&special=highlights - Source What a polite way of putting it! ------------- |
Posted By: tigershark
Date Posted: 22/Apr/2010 at 9:36pm
q4 net more than doubles to 22crs, yrly net 100 crs from 71 crs, pays rs 10 as final div(rs8) declares a 1:2 bonus.all in all a business if one had bought a yr and a half ago can stay invested ,rs8 was interim div so total rs 18 at the time of writing this post i own the stock ------------- understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things |
Posted By: nikhil090
Date Posted: 24/Apr/2011 at 6:43pm
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some info on Rallis
Below is acquisition done in 2010 dec.
http://www.thehindu.com/business/companies/article941819.ece - http://www.thehindu.com/business/companies/article941819.ece
Old interview of Shankar
http://www.thehindu.com/business/companies/article941819.ece - http://www.thehindu.com/business/companies/article941819.ece
One more article on herbicide market
http://in.reuters.com/article/2011/02/24/idINIndia-55119920110224 - http://in.reuters.com/article/2011/02/24/idINIndia-55119920110224
Shankar's viewon Q3 2011 performance
http://in.news.yahoo.com/rallis-posts-40-pc-jump-q3-net-profit-20110117-091900-409.html - http://in.news.yahoo.com/rallis-posts-40-pc-jump-q3-net-profit-20110117-091900-409.html
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Posted By: nikhil090
Date Posted: 24/Apr/2011 at 6:49pm
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company presentation on Q3 results
http://www.rallis.co.in/financial/Fund%20Managers%20presentation_18.Jan.2011.pdf - http://www.rallis.co.in/financial/Fund%20Managers%20presentation_18.Jan.2011.pdf
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Posted By: tigershark
Date Posted: 22/Jul/2011 at 2:37pm
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another business thats delivered a great set of numbers , 40% bottomline growth.
------------- understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things |
Posted By: samirm
Date Posted: 04/Sep/2011 at 10:15am
| %20 - http://economictimes.indiatimes.com/features/investors-guide/rallis-india-long-term-investors-can-hold-on-to-it/articleshow/9849693.cms |
Posted By: samirm
Date Posted: 04/Sep/2011 at 10:39am
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I think Rallis will be compounding machine because of following reason. I am invested in the stock.
1. Scalability (Huge Market) 2. Good Management (Tata) 3. Competitive Advantage - They cover 5 lakh farmers - Eight Rallis brands among top Twelve in 2010 - Tata Group 3. ROE: 25% ROCE: 31% 4. Valuation is high but for a reason 5. Debt Free 6. Growth 30% Please read below. Taken from their annual report. "The Rallis Poised agenda has seven growth drivers, viz. New Products, Contract Manufacturing, Brand Premium, Value Enhancement (known as “DISHA” initiative), Overseas market expansion (named “Apollo”), Adjacent Businesses (seeds and PGN, Agri Services) and Inorganic Growth. Your Company has been pursuing the Rallis Poised growth agenda for consistent delivery of improved performance in recent years. Several initiatives during the year have reinforced this. INORGANIC GROWTH The acquisition of a stake in Metahelix Life Sciences will firm up the Company’s presence in Seeds business. ORGANIC GROWTH The new manufacturing facility at Dahej in Gujarat is expected to become operational shortly. This is a multi-purpose plant and will enhance your Company’s competitive advantage to handle different type of chemistries, increasing the potential to attract contract manufacturing from suitable alliance partners. INCREASING MOAT Initiatives such as the Grow More Pulses (MoPu) programme of the Company, where the Company is actively engaged with the farmers in increasing the productivity of pulses, as also helping them in marketing the produce, aims at embracing the entire value chain of products and services to the farming community. INNOVATION and ORGANIC GROWTH During the year, your Company has launched three new products, viz. Taarak (a paddy herbicide), Toran (an insecticide for cotton sucking pests) and Ralligold (a plant growth nutrient), thereby leveraging the strong brand equity of the Company in providing better products to the farmers." |