Dear Sir,

In Jan’19, we shared a detailed report on Greenply Industries with our members. The stock recommendation was initiated around 130 odd levels and it was also added to our model portfolio.

Recently, on 18th Jul’19, we suggested our members to exit from the stock around 129-130 odd levels.

Now, you would think, what’s so great about buying the stock at 130 and exiting at 129.

Well, the good thing about our investment in Greenply Industries is that we have already taken out the entire money we had invested and we will now get free shares of Greenpanel Industries in the ratio of 1:1, i.e. if we had bought 1000 shares of Greenply, we will now get 1000 shares of Greenpanel Industries.

We expect Greenpanel Industries to list in the range of Rs 25-35 per share which translates into market cap range of 300-400 crore.

Greenpanel Industries will house the entire MDF business and the plywood unit located in Pantnagar (Uttarakhand).

 

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When we had initiated our recommendation on Greenply Industries, we had made certain estimates for FY 23.

Source: Katalyst Wealth Research

Based on our estimates, we had projected Greenply’s Plywood business market cap to be in the range of 1100-1900 crore. Since we got an opportunity to sell Plywood business (minus Pantnagar unit) at a market cap of Rs 1,600 crore in FY 20 itself, we suggested exiting from Greenply.

As far as MDF business is concerned (which will now be housed in Greenpanel), for the same we had estimated market cap range of Rs 1,200-2,000 crore by FY 23. So, as the same is now going to get listed in the range of 300-400 crore, we believe it may provide a good opportunity for long term investment.

Further, post listing the stock could see some correction as the MDF business is only breaking even at present and the profits will improve gradually with expected improvement in realizations.

 

You can read the detailed report on Greenply Industries by clicking HERE

 

Get access to our latest auto-ancillary stock pick by subscribing to one of our Premium Memberships. The new recommendation is also part of our Model Portfolio.

 

Disclosure: Currently, I don’t have any investment in Greenply Industries. I will get new shares of Greenpanel Industries as a result of my holding in Greenply industries on record-date.

 

SEBI Registration No. INH100001690

 

Ekansh Mittal

Research Analyst
Web: https://katalystwealth.com/
Email: info@katalystwealth.com
Ph: +91-727-5050062, Mob: +91-9818866676

 

Rating Interpretation

Positive – Expected return of ~15% + on annualized basis in medium to long term for investment recommendations and in short term for Special situations
Neutral – Expected Absolute return in the range of +/- 15%
Negative – Expected Absolute return of over -15%
Coverage closure – No further update on the stock
% weightage – allocation in the subject stock with respect to equity investments

Short term – Less than 1 year
Medium term – Greater than 1 year and less than 3 years
Long term – Greater than 3 years

 

Research Analyst Details

Name: Ekansh Mittal     Email Id: ekansh@katalystwealth.com    Ph: +91 727 5050062

Analyst ownership of the stock: No

Details of Associates: Not Applicable

Analyst Certification: The Analyst certify (ies) that the views expressed herein accurately reflect his (their) personal view(s) about the subject security (ies) and issuer(s) and that no part of his (their) compensation was, is or will be directly or indirectly related to the specific recommendation(s) or views contained in this research report.

Disclaimer: www.katalystwealth.com (here in referred to as Katalyst Wealth) is the domain owned by Ekansh Mittal. Mr. Ekansh Mittal is the sole proprietor of Mittal Consulting and offers independent equity research services to retail clients on subscription basis. SEBI (Research Analyst) Regulations 2014, Registration No. INH100001690

The views expressed are based solely on information available publicly and believed to be true. Investors are advised to independently evaluate the market conditions/risks involved before making any investment decision

A graph of daily closing prices of securities is available at www.bseindia.com (Choose a company from the list on the browser and select the “three years” period in the price chart

This report is for the personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. Ekansh Mittal/Mittal Consulting/Katalyst Wealth is not soliciting any action based upon it. This report is not for public distribution and has been furnished to you solely for your information and should not be reproduced or redistributed to any other person in any form. This document is provided for assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. Ekansh Mittal or any of its affiliates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Neither Ekansh Mittal, nor its employees, agents nor representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information. Ekansh Mittal/Mittal Consulting or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement.

The recipients of this report should rely on their own investigations. Ekansh Mittal/Mittal Consulting and/or its affiliates and/or employees may have interests/ positions, financial or otherwise in the securities mentioned in this report. Mittal Consulting has incorporated adequate disclosures in this document. This should, however, not be treated as endorsement of the views expressed in the report.

We submit that no material disciplinary action has been taken on Ekansh Mittal by any regulatory authority impacting Equity Research Analysis.

Disclosure (SEBI RA Regulations)

Whether the research analyst or research entity or his associate or his relative has any financial interest in the subject company/companies and the nature of such financial interest – No

Whether the research analyst or research entity or his associates or his relatives have actual/beneficial ownership of 1% or more securities of the subject company (at the end of the month immediately preceding the date of publication of the research report or date of the public appearance) – No

Whether the research analyst or research entity or his associate or his relative has any other material conflict of interest at the time of publication of the research report or at the time of public appearance – No

Whether it or its associates have received any compensation from the subject company in the past twelve months – No

Whether it or its associates have managed or co-managed public offering of securities for the subject company in the past 12 months – No

Whether it or its associates have received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past 12 months – No

Whether it or its associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past 12 months – No

Whether the subject company is or was a client during twelve months preceding the date of distribution of the research report and the types of services provided – No

Whether the research analyst has served as an officer, director or employee of the subject company – No

Whether the research analyst or research entity has been engaged in market making activity for the subject company – No