1
Please refer to important disclosures at the end of this report
1
1
Orient Paper & Industries Ltd (OPIL) manufactures electrical consumer durable
(ECD) and paper segment. The company is a pan India player with over 5000
dealer network for its ECD business. ECD division of the company includes fans,
lighting products, home appliances and switchgears. The company has a strong
presence in the electric fan market with a market share of ~20% in the domestic
fan segment and is the largest exporter of fans from India. OPIL is also looking
to increase its presences into LED (by actively bidding EESL orders) and kitchen
appliances segments. ECD segment recorded sales CAGR of 12% in FY13-16
driven by fan, lighting segments (~77%, 17% of ECD revenue, respectively). The
company recorded revenue CAGR of ~10% in FY13-17 while the EBITDA margin
improved from -0.6% in FY13 to 7.9% in FY17. The company completed the
expansion of its tissue paper unit (25000 MTPA) in May 2017. The management
has guided at a gradual improvement in the profitability of the paper business
with the rising contribution of tissue paper. OPIL has been maintaining a healthy
dividend payout of 28.32% and also improved cash flow from `17.65cr in FY14
to `58.30cr in FY17.OPIL has reported RoE 8.16% and is trading at valuation
P/E 33.5x of FY17 earnings. Hence BUY.
BUY
CMP `98
1.3
Reuters Code
ORPP.NS
OPI:IN
1
BSE Sensex
31,663
Nifty
9,930
Face Value (`)
Consumer Durable
Market Cap (` cr)
2,083
52 Week High / Low
106.8/56.55
Avg. Daily Volume
192,410
Vaibhav Agrawal
022 3935 7800 Ext: 6808
[email protected]gelbroking.com
Orient Paper & Industries Ltd
Others | Consumer Durable
Sept 08, 2017
2
Orient Paper & Industries Ltd |Consumer Durable
June 5, 2017
2
Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com
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Disclosure of Interest Statement Orient Paper & Industries
1. Financial interest of research analyst or Angel or his Associate or his relative No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives No
3. Served as an officer, director or employee of the company covered under Research No
4. Broking relationship with company covered under Research No
Ratings (Based on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
over 12 months investment period): Reduce (-5% to -15%) Sell (< -15)