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Monday, August 3, 2015

Gujrat Raffia Industries Limited(523836) : Buy this small cap at CMP of Rs 5.5-Rs 6.5 for 100% returns Target Rs 13



Gujrat Raffia Industries is manufacturer and exporter of PE tarpaulin.Plastic sheeting,geomembrane,ground sheetings tent shelters,pond lining canal linings,fumigation covers and HDPE Bags.

Company is dependent on performance of core sectors like agriculture, fertilizer, cement and exports. Total retail sales in India are projected to grow by 15% . Strong underlying economic growth, population expansion, increasing wealth of individual and rapid construction of organized retail infrastructure are key factors behind the growth . The policy changes in infrastructure will lead towards the brighter future of the company.

At current market price of Rs 6 the stock is available cheap at PE multiple of 3.5-4 .

One can buy at CMP for long term target of Rs 13

Cautionary statement: Company has never paid dividend and conserving the profits

Financials
)20152014201320122008
Income Statement
Revenue38.7436.5027.5927.6726.58
Other Income0.100.310.050.030.48
Total Income38.8436.8027.6427.7027.06
Expenditure-34.41-33.45-25.86-26.21-24.88
Interest-1.38-1.18-0.41-0.26-0.58
PBDT3.052.171.381.231.60
Depreciation-2.06-1.22-0.65-0.53-0.85
PBT0.990.950.720.710.76
Tax-0.19-0.19-0.14-0.14-0.14
Net Profit0.800.770.580.570.62
Equity5.005.005.005.005.00
EPS1.601.53--1.141.23

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