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Note: The artciles are not research reports but assimilation of information available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that I might have the dkiscussed companies in my portfolio and hence my point of view can be biased.Readers should consult registered consultants before making any investments
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Tuesday, February 25, 2014

DHP India Ltd:-The hidden gem which is set to become the next multibagger.

Scripscan:DHP India Ltd
Bse code:531306
Cmp:33

Story:DHP India Limited engages in the manufacture and sale of low pressure regulators for liquefied petroleum gas (LPG) cylinders, and related accessories and parts in India. Its products include propane regulators, butane regulators, LPG regulators, hose assemblies, and brass fittings. The company also exports its products.The Registered Office of the Company is situated in Kolkata & its Factory is situated in Howrah District, West Bengal.

This is an interesting microcap with good potential.The company has been pretty consistent in its numbers over the last several quarters.Its a mere 10crs mcap company having an equity base of just 3crs.It hails from our part of the world and once am out of this present bedridden restrictions,a management meet seems very on.Promoter owns 75% stake resulting in negligible volumes in the bourses.Its a herculean task to pen analysis about this unknown unheard counters.There's just no detail to work over.Even after meeting the managements if details are put on which are not in public domain,controversies may arise.It has happened in past and chances remain loads of getting it repeated once again.Anyways would still try to dig in details.

DHP has increased its sales from 12crs to 25crs in the last five years.Net profit in the same period vaulted five times to 3.5crs from just 70 lakhs.This can be attributed to its decision of manufacturing its products from trading previously.Presently it boasts of a superb net margin of 14% compared to 5-6% what its used to enjoy earlier.The Company presently has shifted the main focus of its manufacturing business from domestic market to the export markets and is pretty confident of obtaining satisfactory orders in the coming years.

I had the opportunity to interact with a few client of this company.Feedback received can be defined remarkable,they vouched for its world class product quality at much affordable prices.Can the company scale up remains the million$ question.Balance sheet is squeaky clean.Networth stands tall at 16crs with debts of less than 2crs, allowing it to go for fresh debts,in case it plans to expand big.Industry is fragmented though, with the company facing stiff competitions from superior vendors.Its too premature to suggest it a buy as lot of questions are in mind.On a prime facie it looks in better shape than a lot of other inferior microcaps.Volumes are too less,so any bulk buying or selling can make it move either ways bigtime.Growing consumption of low pressure regulators & gas related products coupled with immense potential for LPG  appliances makes the stock worth a look.I am not assigning any fat targets but downside seems very minimal from the present prices.


Quote:Dhp India was suggested few quarters back(http://tinyurl.com/nfx5ogp) to my readers as the microcap of just 10crs marketcap was looking very interesting.The company is buzzing as it has bagged few major orders.I have been able to gather a lot more information on the company which will be updated shortly.Coming quarter numbers should be spectacularly good.All in all a tiny cap to watch out for.

Recent numbers:Net profit of DHP India rose 408.70% to Rs 2.34 crore in the quarter ended December 2013 as against Rs 0.46 crore during the previous quarter ended December 2012. Sales rose 89.70% to Rs 11.23 crore in the quarter ended December 2013 as against Rs 5.92 crore during the previous quarter ended December 201.

btw:People looking for midcap/smallcap positional call professional service may rush a mail at my mail id arunsharemarket@gmail.com to know more about it.

46 comments:

Anonymous said...

on 25th Feb the CMP mentioned by you 33 is wrong it is 44.40 and it leads to confusion. And please provide the target and duration that would be helpful.

Anonymous said...

The stock has already seen 11 continuous UC till 25th Feb. the buying interest still appears very strong which could take it to some I chartered territory.

The stock certainly deserves a re-rating considering its consistent strong results quarter on quarter.

Arun Mukherjee said...

Its not a confusion for readers who would read the note patiently.Read it and you would get it.

Arun Mukherjee said...

Ya a lot of rerating on cards.Another such quarter which the management is confident of,can take the counter to a different orbit.

Anonymous said...

on 25 Feb dhp was 44 and you have mentioned as 33. please clarify .

please share your views on dhp given by you few quarters back.

the above quires are required to us to get confidence .

Arun Mukherjee said...

You read it again and again and you would have the confidence.

Nani Bommasani said...

Good day Arun,

Hats off to you for all your recommendations. I got benefited your Selan, Symphony. what is your view on Vinyl Chemicals and Anu Pharma do you still recommend buying at this level.

Thanks
Hariprasad

Anonymous said...

Is Dynemic Priducts & Camline Fine a buy @cmp? Pls comment.
-Mayur

Anonymous said...

arun, where is u r biggest multibagger microsec?tell us about this now?

Arun Mukherjee said...

Microsec am bullish.Call was at 20,now its at 22-23.

No idea on vinyl or anu.Why to even both for this stocks when so many better bets are quoting at great valuations.

Dynemic I have already answered.Camlin fine chem is an interesting counter to watch out for.

CHINMOY GHOSH said...

beg your comment on kpr mills and ruby mills.please sir take pain to answer

Anonymous said...

arun bro ....how much ur fee for lifetime ...pls message me or tweet me @rajputmahi

Arun Mukherjee said...

Chinmoy da no begging and words like that please.Both are decent bets with good promoters.Should do well once the market realizes the potential of them.

@raj,

Its only 8k per year buddy.Be in touch.

Anonymous said...

Sir can i buy apar industries and mafatlal what is your view on both

CHINMOY GHOSH said...

so kind of u sir . u wouldnt understand how grateful do we feel when people like us given importance and benefited in real terms thank u

Anonymous said...

Dear arun,
First of all I would like to congratulate u for such a wonderful service given by you. Can u pls share ur view on Venus Remedies. Thanks in advance.

Arun Mukherjee said...

Chinmoy da,

We all are here to learn and earn.Without you readers my blog is of no use.I feel really good to interact with prudent and supportive readers like you guys.Be in touch.

Apar is a quality company though results weren't encouraging.Management has guided better numbers forward,stock to do well in long term.I don't track mafatlal.

Venus is in news for patent stuffs.One of the few pharma companies I track and bullish on.Stock seems a safe compounder over the longer haul.

Anonymous said...

Dear sir what is your view upon Maxwell industries and infinite computers as i want to buy one stock of them which one kindly suggest and am i right to buy them for multibagger returns please reply.... Thanks

Nani Bommasani said...

Thanks Arun,
for your response on Vinyl and Anuh Pharma. As your words
"Why to even both for this stocks when so many better bets are quoting at great valuations."

Can you please give me 2 or 3 scrips which I can buy now.

Thanks
HariPrasad

Arun Mukherjee said...

Maxwell and infinite both should do well in the medium to long term period.


Hari,
I have already posted about a lot of companies,read the notes and get the picks.

Nani Bommasani said...

Thanks Arun, I have good conviction on Atul Auto which is one of the stock you recommended and switched to that.

Anonymous said...

Arun don't you follow technical analysis?

Arun Mukherjee said...

Nopes,as am a very long term investor.Can even hold on to a business for 25 years or even lifetime.

Anonymous said...

Hey Arun,

I really appreciate the efforts taken by you to recommend valuable shares to buy for. I would like to know is it advisable to buy DHP india @51 rs.

Also how can I become your paid member. What are the fomalities for that. Please advice.

regards
Preeti

Anonymous said...

How do you find Cravatex @cmp 270?
IS it worth to take long term bet?
Pls reply.
-Mayur

Anonymous said...

Sir what is your view upon upon cupid traders is it buy at cmp and have any new regarding orders from govt. Please reply

Arun Mukherjee said...

Cravatex was a favorite of mine where I made money but sold off as management again went to sleep.Lethargic promoters awakened for couple of years and became conservative again.

DHP if it can repeat its last quarter performance,will move big.Am meeting them soon.Will update after that.

Cupid traders I dont track.So cant comment.Though got a spam sms regarding it.

Preeti,
Appreciate ur words.Kindly mail me at arunsharemarket@gmail.com to know more about the paid services.

Anonymous said...

Hello Arun,

Whats your view on saksoft and Visesh Infotecnics Ltd( among penny stocks). Is it advisable to hold saksoft for long term and buy Visesh at CMP .

Please suggest.

thanks
Rajeev

Anonymous said...

Hello Arun,

Whats your view on saksoft and Visesh Infotecnics Ltd( among penny stocks). Is it advisable to hold saksoft for long term and buy Visesh at CMP .

Please suggest.

thanks
Rajeev

Anonymous said...

Arun, what are your views on sagar soya?

Anonymous said...

Coromandel International is owned by Murugappa Group and has eight manufacturing units. We give buy recommendation for the stock at current price level with target price of Rs 270.

Arun Mukherjee said...

Vishesh got a great business model but am not convinced whether the promoters are honest or not.I mean maybe there are hidden negatives which we arent aware off.No idea about saksoft or sagar soya.

Anonymous said...

Hey Arun,
Which is a better bet between KPIT Tech and Infinite Computer Solutions in longer term? Have been tracking both. Though Infinite is a consistently dividend paying company, the stock seems to be fluctuating a lot. Any reasons for that? KPIT's future looks a bit more promising?

Thanks & Regards.

Anonymous said...

Arunji,

What is your view on V2 retail it fall from Rs.1000/- in 2008 to 13.75 CMP and the company now shows some good performance for the last few quarters. Can i buy the stock at present levels. Your advice/view pls.

Anonymous said...

Sir what do you think about Tree house education?
Please help

Arun Mukherjee said...

Retail is a tough sector to deal into unless you are in a niche.I dont follow v2 but I do like a bet called V-mart retail.Studying the counter actively this days.

Tree house has got a good business model in place with lot of scalability.Positive on it.

No idea why infinite is not getting a superior valuation.Very positive on kpit.Barring geometric and tata elxsi,kpit is another fancy of mine.

Anonymous said...

hi Arun sir.. Can you please give your views on Plethico Pharma from a long term point of view.

Please advise.

gpawansir said...

What is your view on city Union bank and escorts for two to three years.

gpawansir said...

Also bought MPs, orient paper, pfs, ratnamani metals and NHS.after reading your posts in the blog. thank you very much.

Bhavin Mehta said...

Arun Ji,
Today I bought DHP India at 90Rs after going through its fundamentals. But I am too novice to predict trend.
What can be your target for short term (3-6 months)

Arun Mukherjee said...

1)I prefer shilpa medicare to plethcio.

2)Bullish on both city union and escorts for the long haul.

3)DHP already tripled since the coverage.Hard to predict its prices now.

Anonymous said...

Hi Arun,

What is your recommendation on PFS at current levels 27+? I have read your analysis on the company but wanted insight if it is good to enter at current levels.

Thanks,
MD

Anonymous said...

Hi Arun,

What is your recommendation on PFS at current levels 27+? I have read your analysis on the company but wanted insight if it is good to enter at current levels.

Thanks,
MD

Anonymous said...

Hi Arun,

What is your recommendation on PFS at current levels 27+? I have read your analysis on the company but wanted insight if it is good to enter at current levels.

Thanks,
MD

santosh said...

hi Arun

Can i buy DHP @ current level 160

Rajat said...

Hi Arun, what do you think of this stock at current price? Also, wanted to understand/discuss few things with you on this business in general - which countries it exports to?; what are growth drivers?; volatility - last 4 years growth has been quite volatile and so have been realizations (from FY07 to FY11); growth prospects of this business etc. Waiting for your reply, many thanks

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