Industrial stock for 31% upside

We are chasing this stock since a month now , after researching this one in detail our screeners have finally scored this stock & it comes as a long recommendation from the algorithm.

Stock Name : RHI Magnesita India ,  earlier known as Orient Refractories Limited (ORL) is in the business of manufacturing and marketing special refractory products, systems
and services to the steel industry in India and Globally.

Stock has shown excellent results on all our parameters , some of the research notes are here as below :

Company Has A Market Cap Of 11,324 Crores Against Sales Of Over 2300 Crores In Last 12 Months , The Bottom Line Profit Is 330 Crores In Last 4 Quarters which is almost 13% of the top line.

Research Remarks :

  • Stock Has negligible debt and has bottom line profit of 13% of the top line , which is extremely healthy margin in this industry
  • Debt Is Comfortable With D/E RATIO @ 0.05
  • Promoter , FII and DII have Continuously added this stock on quarterly basis
  • Impressive ROE of 30% and rOCE of 37%
  • Growth of 120% in EBIDTA yearly and 50% on tTM basis
  • Great reserves with absolutely Negligible debt on the company
  • Leading player in its industry , may acquire 100% stake in Dalmia OCL
  • Few Concerns on the stock :
  • Y-O-Y Lower Operational Cashflow & Investment In Capex , Plant And Machinery .
  • High P/E stock may become expensive if earnings do not come in line with expectations

We may buy this stock at 810 levels and hold up to 1100 levels in next 6 months.

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