Texmo Pipes and Products is a leading player in the pipes and fittings industry. It manufactures and markets PVC pipes and fittings, SWR pipes and fittings, CPVC pipes and fittings, Molded fittings, Plumbing pipes and fittings, Casing pipes for tubewells and other agricultural fittings. For more info check, http://www.texmopipe.com/
PRESENT DAY NUMBERS
CMP on Day06 July2014: Rs 18.75 Market cap: 45 crores BV: 51 FV: 10
Revenue FY13: 205 cr (FY12 176 cr) Net profit: 1.2 cr (FY12 4.1 cr) EPS: 0.5 (FY12: 1.7)
Debt: 46 cr
BRIEF HISTORY
Texmo pipes and products was incorporated as a public limited company in the year 2008; by conversion of Shree Mohit industries and Shree Balaji industries. The company has its manufacturing plants and head office in Burhanpur, M.P.
MULTIBAGGER POTENTIAL
1. The production of CPVC pipes and products commenced on June 19; Texmo is one of the few manufacturers in this product category and hence may benefit with higher margins
2. The pipe production capacity has increased by 200 MT per month and fittings by 50 MT. This will aid in revenue growth and increased market share.
3. As per the interview with the MD of the company by CNBC; the company hopes to execute orders of around 140 cr during FY15.
4. Texmo bagged an order of around 60 crore from Power Grid corporation earlier this year. And another order from BSNL.
INTERESTING INFO
1. Texmo came with its IPO in the year 2010; at a price of 90 rs. Currently in 2014 it is available at 18 rs (a huge discount; almost like a wind up sale)
2. During the same time its production capacity has more than doubled (plus a new plant for manufacturing of CPVC products; which are niche)
3. Currently they are present only in 8-10 Indian states. (and intend to become a pan India company); So tremendous headroom for growth.
4. In the last 3 months; the promoters have bought over 5 lakhs shares in the open market. VERY IMPORTANT POINT
MY TAKE
Texmo pipes mainly supplies to the sectors of agriculture, power, building and construction, telecommunication and infra structure. The new government will give special impetus to almost all the sectors mentioned and hence Texmo could be a potential beneficiary and hence is poised for rapid growth and profitability over the next 2 - 5 years. At current valuations, this stock is deeply undervalued.
This is a very young company with all the right ingredients for growth; Investing in this would be like investing a small sapling. And if the right environment, necessary support(water/manure), protection is provided; this can grow up to be a strong and profitable tree.
A high potential multibagger!!
Disclosure: Texmo pipe and products is part of my core holdings. I own 9000 shares (and intend to add more)
PRESENT DAY NUMBERS
CMP on Day06 July2014: Rs 18.75 Market cap: 45 crores BV: 51 FV: 10
Revenue FY13: 205 cr (FY12 176 cr) Net profit: 1.2 cr (FY12 4.1 cr) EPS: 0.5 (FY12: 1.7)
Debt: 46 cr
BRIEF HISTORY
Texmo pipes and products was incorporated as a public limited company in the year 2008; by conversion of Shree Mohit industries and Shree Balaji industries. The company has its manufacturing plants and head office in Burhanpur, M.P.
MULTIBAGGER POTENTIAL
1. The production of CPVC pipes and products commenced on June 19; Texmo is one of the few manufacturers in this product category and hence may benefit with higher margins
2. The pipe production capacity has increased by 200 MT per month and fittings by 50 MT. This will aid in revenue growth and increased market share.
3. As per the interview with the MD of the company by CNBC; the company hopes to execute orders of around 140 cr during FY15.
4. Texmo bagged an order of around 60 crore from Power Grid corporation earlier this year. And another order from BSNL.
INTERESTING INFO
1. Texmo came with its IPO in the year 2010; at a price of 90 rs. Currently in 2014 it is available at 18 rs (a huge discount; almost like a wind up sale)
2. During the same time its production capacity has more than doubled (plus a new plant for manufacturing of CPVC products; which are niche)
3. Currently they are present only in 8-10 Indian states. (and intend to become a pan India company); So tremendous headroom for growth.
4. In the last 3 months; the promoters have bought over 5 lakhs shares in the open market. VERY IMPORTANT POINT
MY TAKE
Texmo pipes mainly supplies to the sectors of agriculture, power, building and construction, telecommunication and infra structure. The new government will give special impetus to almost all the sectors mentioned and hence Texmo could be a potential beneficiary and hence is poised for rapid growth and profitability over the next 2 - 5 years. At current valuations, this stock is deeply undervalued.
This is a very young company with all the right ingredients for growth; Investing in this would be like investing a small sapling. And if the right environment, necessary support(water/manure), protection is provided; this can grow up to be a strong and profitable tree.
A high potential multibagger!!
Disclosure: Texmo pipe and products is part of my core holdings. I own 9000 shares (and intend to add more)
It seems the company did not pay any dividend to the shareholders for the past years.Why?
ReplyDeleteDear Karthikram; Texmo is a very young company. So just by that one reason; it is not fair to expect a dividend from the company.
DeleteIf you do a little more detailed study; since last 3 - 4 years; they have significantly increased their manufacture / production capacities of their old plant with earlier products.
They have further commissioned a new plant for CPVC products and fittings (which happened very recently). The positive results and impact of all these developments will be visible in the next 3 - 4 quarters.
Best regards!!
Further to add; this is not a best stock for an investor who is looking for dividend payments.
DeleteThis stock is deeply deeply undervalued; and can provide huge profits in terms of capital gains.
Profit potential of the stock over next 1 - 2 years is phenomenal. Don't be too surprised with what is possible in this case. Best regards!!
dont fear buy with full force tgt. 450 in 2-3 years.... they have got trade mark `Texmo` for their products... Texmo is most most & most trusted brand among farmers across India...
DeleteHello Sir, I'm a beginner looking to invest in multi baggers for long term 2-3 years. Which stocks should I pick. I'm willing to take calculated risk, what should be my initial investment ?
ReplyDeleteHi Prody; You made a very good decision to invest in potential multibagger stocks. If you follow this in a disciplined manner and do not loose your focus; you will become very rich over a period of time.
DeleteYour time frame of 2 - 3 years is very prudent, and if you manage yourself well without panic due to short term fluctuation and volatility; then you risk is almost ZERO.
As you are a beginner; start with buying stock in 2 companies; Firstsource solutions and Texmo. You can start buying in small chunks (when ever you find small dips); You can accumulate both these stocks and increase your stock holding over next 2 - 3 months.
All the very best to you!!
Thanks for sharing.
ReplyDeleteCPVC pipes & fittings India
Dear Zorba, following scripts are in my portfolio in 10K nos : ILFS manager @ 15/-, TRF @140/-, Bilcare @ 96/-, Panacea Biotec @130/-, HSIL @120/-, Sanghvi Movers @ 89/-, Gitanjali Gems @ 86/-, Suzlon @ 32/- and Texmaco PIpes @ 15/-. Kindly advice if these stocks in long term will give multibagger gains just like Granules or advice other better ones.
ReplyDeleteDear Salim; Most of the stocks that you own; I have no idea about them. Probably will take a look some time.
DeleteSuzlon; I would never buy (due to humongous debt burden)
Gitanjali; Not for me (due to corporate governance issues)
The last stock; I am assuming it is Texmo pipes; A fantastic potential multibagger with 2 - 3 time horizon.
Granules has been one of the most profitable stock in the last 6 months.
If we can manage to find stocks like Granules; and hold on to them for a 400-500% profit; we can become millionaires.
Granules I bought at 150 and sold at 180 (feel like kicking myself);
Happens!!
Now it is too late. No point in chasing stocks which are well into momentum.
All the best!!
Salim; Some companies about which I am super confident are: Firstsource solutions, Prakash constrowell, Texmo, Patel logistics and L&T finance.
DeleteAll these stocks have multibagger potential from a 2 - 3 time horizon.
Just ignore the short terms movements and volatility. Make sure you don't panic during short term down moves. Rather use those opportunities to add more.
Basically you got to look at 3 things;
1. Is the company a quality business with solid fundamentals?
2. Is it deeply undervalued?
3. How is the future scope and potential of the business? (growth)
If you get these 3 right; then u have a potential multibagger on hand. Then it is only a matter of time.
Best regards!!
Thx. Plz let me know about rest of the scripts. Also there is a compitetor named shand pipes with cpvc business then in what way texmo is different?
ReplyDeletehi Zorba,
ReplyDeleteloved ur blog, already a big fan of urs, amazing analysis, thanks a ton for helping all small investors.
god bless.
regards
hi Mark!! Loved ur msg :-)
DeleteThnx for the good wishes!!
My Objective: As many people (small investors) as possible should make as much money as possible from the stock market.
Wish u tons of profits in the stock market. Best regards!!
Hi,
ReplyDeleteDo you cover JHS Svendgaard Lab Ltd ?.. If yes, what's your view ?
regards
J Gopal
Hi Gopal; Few months ago I had done a study and assessment of this company. At first look this appears like a very interesting investment idea. Deeply undervalued also.
DeleteHow ever there are too many unknowns and minefields around this company. This would need a massive massive turnaround. And I am not convinced that it is possible.
Think about it. At the end of the day, the company is a "contract toothbrush manufacturer". Manufacturing toothbrush is not rocket science. Too many things have gone wrong for them. If indeed a turnaround happens; I will be surprised.
I do not invest in any company where more than 10% risk is involved. So this one is a absolute NO for me.
Best regards!!
Hi Zorba,
DeleteThanks . concur with your views.
regards
J Gopal
Meghmani is also starting cpvc production with Jv from kanoria a Japan Mnc....competitor for texmo!
ReplyDeleteSalim khan
DeleteCpvc first time in india ASTRAL POLY THEN MEGHMANI THEN THIRD COMPANY IS TEXMO PIPE HAI VERY GOOD COMPANY
Thanks Sir ...For your in depth analysis of Texmo
ReplyDeleteWelcome, Irshad.
DeleteI wish u gr8 profits in the stock market.
Best Regards!!
Thanks for this post. It is very useful for us. We have also same product in CPVC pipes & fittings.
ReplyDeletePVC Pipes & Fittings India
am holding 8784 shares at avg price of 6.69 and intend to add more at CMP ... expecting to HOLD for next 5 yrs ... is it a right stratergy
ReplyDeleteWell done, Adarsh. Gr8 to c that u have bought Texmo at sub 7 rs levels. Fantastic buying price.
DeleteYou can easily continue to hold for next 1 - 2 years (and rake in the profits)
How ever as u r already sitting on a 150%(plus) profit; adding more may not be wise. It will take up ur acquisition price substantially upwards.
If you have new funds to allocate, take a look at Firstsource, Edelweiss or Datamatics.
Cheers!!
Hi Sir,
ReplyDeleteCan i purchase texmo pipes at current level for long term(5 years)?.Please share your advice me.
Dear Partha sarathi,
DeleteWith any doubt, Texmo is deeply deeply undervalued. And it is a decent company. So makes lot of sense to buy it.
Whether to buy or not, that decision you have to make.
A company with annual revenues of approx 250 crore is available at 40 CR.
How cheap can it get??
Good luck!!
dont fear buy with full force tgt. 450 in 2-3 years.... they have got trade mark `Texmo` for their products... Texmo is most most & most trusted brand among farmers across India...
Deletei am waiting for your valuable feedback.
ReplyDeleteTodsy upper circuit ,20% price 18.95 buy buy patient
ReplyDeleteHi Sir,
ReplyDeleteI am holding 1600 shares currently. Can i purchase more at current levels to accumulate ?
Oil krud price down so benifit texmo good profit hoga
ReplyDeleteHi Sir, are you suggesting fresh entry at current level or wait for further correction?
ReplyDeleteLast two day good volume texmo pipe accumulation good time last 8 months buy buy maine kya hai ab slow result good aayege bad price badhega
ReplyDeletedont fear buy with full force tgt. 450 in 2-3 years.... they have got trade mark `Texmo` for their products... Texmo is most most & most trusted brand among farmers across India...
ReplyDeleteHi zorba ,
ReplyDeletePlease tell ur view on Texmo pipes..Currently holding stocks @18 ..I'm good to wait 2 years...Any thing going wrong with this script??...If every thing is fine I'm looking to average at current price 9.66...Almost lost 50% on this script..Please suggest
Hi Vivek,
DeleteMultibagger investment is like a journey. A potential multibagger stock could take 3 - 4 years(sometimes more) to maximize its profits. Patience is very important for making multibagging(100 - 500%) gains. From the time you make(buy) an investment, to the time you exit(sell) your investment, the stock will go up and go down and sometimes remain flat. That is the reality of the stock market.
My objective here is to share knowledge and info about potential multibaggers that I come across, as that is my focus area. How ever I will not be able to give reasons most of the times as to why some stock is going down or up. Also, I do not give targets.
Hope you now understand better, how multibagging investment works.
Best Regards!!
Continuing from my previous message,
Delete1. Personally I do not believe in averaging. If I buy or add more stock at lower levels, the intention is to mainly accumulate more shares at a lower price. But never for averaging reason.
2. U talked about 50% loss. In reality, you are under negative NOT LOSS. You will loose only if you sell. If you wait patiently for 2, 3, 4 years; your chance of loosing is very little.
If you want to make multibagging profits, then PATIENCE IS EVERYTHING.
Finally, I repeat, I do not give buy/sell calls.
Nor do I do astrology to predict why a stock is going up or going down.
My purpose is to share info and knowledge. What you want to do with it is your decision.
Regards!!
Zorba friends good information for texmo Thank you
DeleteBuy accumulation every decline ... Mai decline me buy karta hu today price 9.75 me accumulation kia good opportunity hai..last qurter result good tha..
ReplyDeleteThis comment has been removed by the author.
ReplyDeletecheers all... continuous circuits... making new high every day
ReplyDeleteVery good and precise analysis
ReplyDeletesir can investment of 3000 rupee in each multibagger is enough pls suggest rec of 2014-2015 should i buy now pls suggest.
ReplyDeleteA big jump in Price may be coming in next year if heavy competition is nit faced by company. Then buy and hold for tgt@32
ReplyDeleteWhat problam this company shere price very low last five years this i think very good company
ReplyDelete