RUBFILA International-500367 : Face Value Rs 5 : CMP 45 Buy for one year Target of 65

Rubfila International Limited (RIL) is  promoted by Rubpro Sdn. Bhd., Malaysia and Kerala State Industrial Development Corporation . The company which started with manufacturing extruded Round Latex Rubber Thread later ventured into the manufacture of industrial adhesives used in various applications like footwear/ leather goods, lamination/printing, carpet, construction etc. The State of the Art infrastructure facility of is located at New Industrial Development Area, Kanjikode, Palakkad, Kerala. Kerala is the heartland of natural rubber in India.

The production facility of RIL is designed to produce both Talc Coated Rubber Thread (TCR) as well as Silicon Coated Rubber Thread (SCR) and fine grade of Eco-friendly water based adhesives. The annual production capacity of this world class facility is 6350 MT and 20000 MT of adhesives per annum. RIL is the market leader in India in the business of rubber threads and is also a leading exporter of the product from India. RIL produces rubber threads for various applications like apparel, food grade, furniture webbing, bungee jumping, toys , medical netting, diapers, catheter manufacturing etc.

RIL also produces adhesives suitable for various industry segments like leather and footwear, tyre Re- treading ,wood, rexin and foam , automotive, to name a few.

Top line of the company is growing at decent pace year on year an expected to touch 165 crore this FY with top line growth of 30%. Falling rubber prices and improving demand in local and export market should help company to improve net profit margin going forward. Company has already declared half yearly EPS of approx Rs 1,5 and expected to deliver EPS OF 4  this year.It's a debt free company at a forward PE multiple of 10-11 stock looks cheap.last 2 years company has been paying dividend @12% every year.

Long term investor with 1-2 year horizon can invest in stock at current market price of 43- 45 should cross 53 in short term and in a long term basis stock could see levels of 65-80 in next 2 years.