MOSL: Morning India (20/June/17)-1. Prabhat Dairy (Solid institutional player)-2. Tata Steel (Selling Tata Motors’ shares will boost equity value by INR31/share); 3. Voltas
​MOrning India (20/June/17): 1. Prabhat Dairy (Solid institutional player); 2. Tata Steel (Selling Tata Motors’ shares will boost equity value by INR31/share); 3. Voltas; 4. EcoScope; 5. Metals Weekly
Today’s top research idea
Prabhat Dairy: Solid institutional player; Moving toward consumer business
Prabhat Dairy is a fully integrated dairy products company. The company sells specialty and co-manufactured products to its institutional customers, as well as branded dairy products.
The consumer branded business (B2C) is expected to account for ~50% of its revenues by 2020 (30% as on FY17), led by Hotels, Restaurants and Caterers (HoReCa), and Retail.
Prabhat targets 80% direct sourcing of milk by FY20 (~70% currently), which should help it source higher volumes of good-quality raw milk.
Utilization at its cheese manufacturing facility is expected to increase from ~20% currently to 80% by FY20.
Over the past 4 years, the company has delivered revenue, EBITDA and PAT CAGR of 22%, 15% and 25%, respectively. The stock trades at 19x FY19E EPS.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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