Current Multibagger Stock

Avanti Feeds Limited

About: Avanti Feeds Ltd. is an exporter and in a business of manufacturing of prawn and fish feeds, and shrimp processor. Avanti Feeds also has established joint venture with Thai Union Frozen Products PCL., the world’s largest seafood processors and leading manufacturer of prawn and fish feeds in Thailand. Avanti has multiple Prawn and a Fish Feed Manufacturing Units and producing nutritionally well balanced and high quality feed, consistently, catering to the Indian prawn and fish farmers, at their doorstep. In the below fundamental analysis, we will figure out if Avanti Feeds Ltd. is possible multibagger for FY 2020 or not.

Financial Health

Balance Sheet

We have picked selected line items which actually matters to evaluate the Balance sheet of Avanti Feeds Ltd. As we can see, the Equity Share Capital of the company has remained the same throughout last 5 years wherein, they have increasing their Reserves year by year. This is a very good stance for fundamentally strong company. Looking at the secured and unsecured loans, they have continuously reduced their loans and in the FY 2018, they don’t have any loan which makes it a Zero debt company, which is another sign of a fundamentally strong company. Being a stock analyst, I always look for a Zero debt company because if you get the shares of such companies at an intrinsic value, it will definitely give you profits. Coming back to the topic, let’s continue if Avanti Feeds is multibagger or not.

Profit and Loss Statement

Profit and Loss Statement

As shown in the Profit and Loss Statement of Avanti Feeds Ltd, they have been consistent in increasing their Net Sales and their Employees Cost has been increasing too, which means they need more and more staff every year. They have reduced their interest too as they have reduced their secured loan, which we saw above in the balance sheet and in the FY 2019, they will have to pay Zero interest as they completely paid off their loans. Overall, the profit and loss of the company gives a good sign to continue its profit in coming years too and we can expect this company to becoming a multibagger soon. Till now, we have seen Avanti Feeds is a good company, now will dig deeper and go into the Fundamental Analysis of the company.

Fundamental Analysis

Current Share Price

The closing price of Avanti Feeds Ltd on 22nd Feb was Rs. 241.85, from this we will go into the Price to Earnings ratio of the company. We can see the EPS is 21.18 which make the current PE ratio of the company as 16.14 times (shown in the below mentioned image). We can also the share is trading near to its 52 weeks low, it is another sign that the stock price can run upwards anytime soon and have the possibility to a multibagger or at least 2-3 bagger.

PE Ratio

Future PE Ratio

Forward PE Ratio

Now we will calculate 1 Year forward PE ratio with the help of CAGR. If we calculate the EPS of the company for 3 years, we see the CAGR is 38.77%, which gives the Estimated EPS of 126.80 and using the estimated EPS, we can get forwarded PE ratio which is 2.51 times. Any case where the forward PE ratio is lesser than the current PE ratio, we can say the stock is undervalued. Therefore, we can say the stock is trading low from its original price.

Relation between PB Ratio and Return on Equity

PB Ratio

As we can see the PB ratio of Avanti Feeds Ltd. is increasing and with a dip in FY 17, Return on Equity is back to 44.24 in FY 18. It can be a good time to invest in this stock and expect to book profits in coming year or so.

Evaluation of stock price using PEG Ratio

PEG Ratio

From the above analysis, we can see the PEG ratio is 0.76. I would like to mention that if the PEG ratio of a company is lesser than 1, it is the best time to buy the stock as it’s undervalued, which is the case with Avanti Feeds Ltd at the moment. We all can get this stock and book good profit when it will become a multibagger in upcoming years.

Target Price using EBITDA

Target Price – EBITDA

Here, we have calculated EBITDA of last 7 financial years and basis on the EBITDA, we can calculated the Expected EBITDA for next Financial Year, which comes to be 914. If we divide the Share Outstanding by Forecasted EV, we can get the target price of Avanti Feeds Ltd, which could be 1051, that is almost the triple of the current share price. And if we keep the 2/3rd as the safety margin, we get 701 and still higher than the current share price, thus, it shows the possibility to be a multibagger and definitely a must buy stock.

Target Price using PE Model

Target Price – PE Model

In the above analysis, we have tried to calculate the Target price using the PE model. Here we can see, the ideal entry price of the share is 307, I agree that as per PE model, the current share price is slightly higher; however, it still shows great potential to be a multibagger and we can buy the share to make profit in future.

Conclusion

From the all above analysis, we can Avanti Feeds Ltd. is currently trading undervalued and also has all the sign to be a multibagger for the upcoming years. This seems to be a stock which can run up and it must be added in our portfolios. Being a stock analyst, I would strongly recommend buying this stock to be rich in near future.

Dhanuka Agritech Ltd, multibagger 2020

About: Dhanuka Agritech Ltd. is in manufacturing of extensive range of products related to agriculture like insecticides, herbicides, fungicides and plant growth regulators. The company has its presence in entire country through their marketing offices in all major states, with more than 7000 distributors/dealers, which are selling to over 75000 retailers across India and reaching to more than 10 million farmers of India. The company also has also tied up with 4 America, 5 Japanese and 2 European Companies. In the below fundamental analysis, we will figure out if Dhanuka Agritech Ltd. is possible multibagger or not.

Financial Health

Balance Sheet of Dhanuka Agritech Ltd.
Balance Sheet of Dhanuka Agritech Ltd.
Balance Sheet of Dhanuka Agritech Ltd.

We have picked selected line items which actually matters to evaluate the Balance sheet of Dhanuka Agritech Ltd. As we can see, in the Financial Year 2016, Equity share capital of the company was Rs. 10 Cr. and in the Financial Year 2017, they bought their few shares back. We can also see that they have bought their shares back in 2015 as well. As we all know, Warren Buffett loves those companies who buy their shares back and the reason is if a company buys its shares back, it means the profit can be shared in lesser shareholders. Moving on, we see that they have been constantly increasing their reserves. And the best part is they are also reducing their loan year by year. Being a stock analyst, I liked this company at a very first glance; however, we will not jump the gun and go through the complete fundamental analysis to the prospects of Dhanuka Agritech being a multibagger for future years.

Profit and Loss Statement
Profit and Loss Statement

As shown in the Profit and Loss Statement of Dhanuka Agritech Ltd, they have been consistent in increasing their Net Sales and their Employees Cost has been increasing too, which means they have been increasing their staff every year. They have reduced their interest too as they have reduced their secured loan, which we saw above in the balance sheet. Overall, the profit and loss of the company gives a good sign to continue its profit in coming years too and we can expect this company to becoming a multibagger soon. Till now, we have seen Dhanuka Agritech is a good company, now will dig deeper and go into the Fundamental Analysis of the company.

Fundamental Analysis
Share Price

The closing price of Dhanuka Agritech Ltd on 15th Feb was Rs. 396, from this we will go into the Price to Earnings ratio of the company. We can see the EPS has been reduced to 23.32 and yet the current PE ratio of the company is 16.98 times, wherein the Industry PE ratio is much higher at 39.56. This simply means the stock of the company is undervalued. We can also see from the above image that the stock is trading at very close to its 52 week low, it is another sign that the stock price can run upwards anytime soon.

PE Ratio
Future PE Ratio
Forward PE Ratio

Now we will calculate 1 Year forward PE ratio with the help of CAGR. If we calculate the EPS of the company for 5 years, we see the CAGR is 6.67%, which gives the Estimated EPS as 27.42 and using the estimated EPS, we can get forwarded PE ratio which is 14.44 times. Any case where the forward PE ratio is lesser than the current PE ratio, we can say the stock is undervalued. Therefore, we say the stock is trading low from its original price.

Relation between PB Ratio and Return on Equity
PB – ROE Ratio

As we can see the PB ratio of Dhanuka Agritech Ltd. is reducing from past three years while their Return on Equity is growing. This is a sign of multibagger stock. I can also tell you the best time to buy a stock is when PB ratio is between 3 to 6 and the current PB ratio of the company is 4.29, therefore, it is the best time to buy this stock.

Evaluation of stock price using PEG Ratio
PEG Ratio

From the above analysis, we can see the PEG ratio is 0.85. I would like to mention that if the PEG ratio of a company is lesser than 1, it is the best time to buy the stock as it’s undervalued, which is the case with Dhanuka Agritech Ltd at the moment.

Target Price using EBITDA
Target Price – EBITDA

Here, we have calculated EBITDA of last 7 financial years and used that to calculate the Expected EBITDA for next Financial Year, which comes to be 714. If we divide the Share Outstanding by Forecasted EV, we can get the target price of Dhanuka Agritech Ltd, which could be 624, that is almost the double of the current share price. And if we keep the 2/3rd as the safety margin, we get 416 and still higher than the current share price, thus, it shows the possibility to be a multibagger and definitely a must buy stock.

Conclusion

From the all above analysis, we can Dhanuka Agritech Ltd. is currently trading undervalued and also has all the sign to be a multibagger for the upcoming years. This can be a great stock and it must be added in our portfolios. Being a stock analyst, I would strongly recommend buying this stock to be rich in near future.

J B Chemicals and Pharmaceuticals Ltd.

About: J B Chemicals and Pharmaceuticals (JBCPL) is one of the fastest growing companies in pharmaceuticals industry. This public listed organization focuses on supplying affordable and quality products in India and International markets. JBPCL is a trusted name among healthcare professional around the world. They are exporting around 30 countries across the world and making half of their revenue internationally. We will analyze to see if JBPCL has the potential to be a Multibagger for 2020 and coming years. For this, we will start from the Balance Sheet of the company.

Financial Health

Balance sheet of JBCPL

As we see, Total share capital and Equity share capital of JBCPL had the total Share Capital of Rs. 16.95 Cr. in 2014 but they bought back their shares in 2018 and now the total share capital is 16.71 Cr. Additionally, they have been constantly working to increase their Reserves which is helping to increase their Net worth and at the same time they have been reducing the loans. This is a sign of a fundamentally strong company and to be an emerging multibagger in upcoming years. That being said, we also need to check, how JBPCL is doing in their business and to figure it out, we will look into the balance sheet of the company.

Proft and Loss of JBPCL

As shown in the Profit and Loss Statement of J B Chemicals and Pharmaceuticals, their Net Sales and Consumption of Raw Materials have been continuously increasing. Their tax is also going low as they have also reduced the loan amount. All this is indicating that investing in JBCPL can be very beneficial for us all. Till this point, we have seen how this company has been performing in the past, now will go into how this company will perform in the future, therefore, we will start the fundamental analysis of JBCPL.

Fundamental Analysis

PE Ratio

The Current PE of JBCPL is 16.48 where in the Industry PE is much higher at 30.17. That tells us that the current Profit to Earning ratio is lower and it’s a good time to invest in the stock of the company.

Forward PE

If we try to calculate 1 year forward PE ratio of JBCPL that we will find the forward PE ratio is 22.34, which is much higher than the current PE of 16.48. This is one more indication for all who wants to make money from this company.

Future of the Stock

Price to Book Value

From the Price to book value analysis with the Return on Equity, we can see that in March’17 PB ratio was 2.12 whereas it decreased to 1.78 and in March’17, Return on Equity was at 7.83 and it jumped to 8.51 in the year March’18. Any company who is succeeding in reducing the PB ratio and increasing the Return on Equity has greatest potential to be a multibagger and we see that indication in this JBCPL.

Evaluation of stock price using PEG Ratio

PEG Ratio

From the above analysis, we can see the Average EPS for 3 years and 5 years is 9.8% and 15.1% respectively, which gives us the future PEG ratio as 1.09. Any company who has which future PEG ratio as 1 is perfect to invest and in this case, the future PEG ratio is almost 1, therefore, we can expect it to be multibagger in future.

Target Price of Jubilant FoodWorks Limited

Target Price

Here, we can see the expected EBITDA for next financial year would be around 249, which is little higher than the current EBITDA i.e. 238 and that makes the forecasted EV as 2687. From all this calculation, we are getting the target price as Rs. 336. As keeping the margin of the safety in mind, the best price to buy this share would be 224 and the current price of the share is higher than our entry price so, the best decision would be to wait and buy it only when you get this share at the best price.

Conclusion

From the all above analysis, we can say that J B Chemicals and Pharmaceuticals is a good company with great fundamental, however, as per the current scenarios, the price of the stock is still higher and being a stock analyst, I would suggest to hold and buy only at the right price.

Jubilant FoodWorks Limited

About: Jubilant FoodWorks Limited is one of the famous names in Fast-Moving Consumer Goods (FMCG) companies, which is making its way up at a rapid pace. As we know they have two International brands franchisees under its roof i.e. Domino’s pizza and Dunkin’ Donuts. Domino’s Pizza India operates 1,167 restaurants covering 269 cities across the Country and with bright future of Dunikin’ Donuts, Jubilant FoodWorks Limited will achieve greater heights. To figure out if it is one of the best stocks to buy, we will go through the Financial Health of the company and we will also do Fundamental Analysis of Jubilant FoodWorks Limited.

Financial Health

Balance Sheet of Jubilant FoodWorks Limited, 2018

We all know how does a Balance sheet look like, however, we have picked the selected line items that we need to consider. As we can see, Total share capital and Equity share capital of Jubilant FoodWorks Limited has been remained almost the same wherein they still have zero debt to pay. From that we can definitely give a good stance to this company.

Profit and Loss Statement, 2018

As shown in the Profit and Loss Statement of Jubilant FoodWorks Limited, their Net Sales and Consumption of Raw Materials have been constantly growing. If we talk about P/L before tax and Net Profit, it dipped in the year 2017 but in the year 2019 they just not recovered but managed to double their profits of year 2016. As we can expect more profits in the coming year of 2019, once again we will give a definitely positive stance to them. Up until now, everything looks good, now will go bit deeper into Fundamental Analysis to see if it is a right pick as stock to buy.

Fundamental Analysis

The Current PE of Jubilant FoodWorks Limited is 56.15 where in the Industry PE is much higher at 69.51. That tells us that the current Profit to Earning ratio is lower and it’s a good time to invest in the stock of the company. Additionally, current PE ratio using the CAGR is 38.99 and the one year forward PE using the CAGR seems to be around 31.32. As the forward PE ratio with the help of CAGR is lower, thus, we can again conclude that the current price of the Stock is Undervalued. 

P/E ratio

The Current PE of Jubilant FoodWorks Limited is 56.15 where in the Industry PE is much higher at 69.51. That tells us that the current Profit to Earning ratio is lower and it’s a good time to invest in the stock of the company.

Additionally, current PE ratio using the CAGR is 38.99 and the one year forward PE using the CAGR seems to be around 31.32. As the forward PE ratio with the help of CAGR is lower, thus, we can again conclude that the current price of the Stock is Undervalued. 

Future of the Stock

PB Ratio to Equity

From the Price to book value analysis with the Return on Equity, we can see that PB ratio was 7.89 whereas it increased to 19.77 which is a jump of 2.5 times while the Return on Equity increased by 1.7 times, therefore it shows a great potential the value of stock in the year 2019.

PEG Ratio

From the above analysis, we can see the PEG ratio is 1.92, which is seems to be high but still a good bet that shows the high chances of making us all rich are pretty high too.

Target Price of Jubilant FoodWorks Limited

Target Price

Here, we can see the expected EBITDA would be around 524, which is higher than the current EBITDA i.e. 469 and that makes the forecasted EV as 17000. From all this calculation, we are getting the target price as Rs. 2876.

Conclusion

From the all above analysis, we can Jubilant FoodWorks Limited have a good forthcoming year where they will make good profit. The stock is currently undervalued so we can get this as cheap price. Being a stock analyst, I would say it is one the best stocks to buy and my recommendation would be to buy Jubilant FoodWorks Limited.