United Phosphorus Ltd— BUY—157—INR
Sector — Agrochemicals
Regd.Off.— A-2/1, G. I. D. C., Vapi, Valsad, Gujarat-396195
Listed — NSE, BSE.
Company overview—
United Phosphorus Ltd, formerly known as Search Chem Industries Ltd, a subsidiary of erstwhile United Phosphorous Ltd is into manufacture of Chlor alkali products, Industrial chemicals and speciality chemicals. Company was incorporated as Vishwanath Commercials on Jan 2, 1985 was originally promoted by Debisingh Shekhawat, Lalit Kumar Sharma and Associates and went public in Feb 1985. United Phosphorus acquired 75% equity in Search Chem in March 1995 and UPL acquired further shares in Aug 1995 and became the promoter of the company. Subsequent to takeover it diversified into manufacture of chemicals. The company entered into manufacture of Chlor-alkali products by commercialization of Phase I of its Caustic and Chlorine and Phosphorus Trichloride plants in 1995-96. During 1998-99, company has installed a new plant to manufacture Phosphorus Oxychloride and also installing a plant to manufacture Elemental Phosphorus as a main input of the company. Company has an agreement with General Electric Energy Plant Operations LP for operation and maintenance of power plant. During the 2004-05, company has enhanced its installed capacity of Pesticides and Pesticides Intermediates by 9940 Ton and 890 Ton. Resultant with this expansion of the total installed capacity of Pesticides and Pesticides Intermediates has increased to 28040 Ton and 17546 Ton respectively.
Products & Services—
Company is the largest producer in India of crop protection products. Company has a wide range of products include fumigants, fungicides, insecticides, rodenticides and herbicides. Company ranks fourth amongst the generic agrochemical companies in the world. It is the world's largest producer of Aluminium Phosphide, which is manufactured at one of our manufacturing sites in India and Napropamide, which is produced by one of the company's subsidiaries in the UK. Company manufactures Iso Propyl Bromide, Thi Diphenol and Other Specialty Chemicals 600 TPA, Phosphorus Pentoxide 500 TPA & Phosphorus Penta Chloride 350 TPA. Company is a leading manufacturer of chlorine and Phosphorous based industrial chemicals and speciality chemicals like Phosphorus Pentachloride, Phosphorus Trichloride, Phosphorus Oxychloride, HEDP, Tri Phenyl Phosphite, Tri Phenyl Phosphate, ATMP etc. Comapany is also into power generation. The surplus power after captive consumption is sold to Gujarat Electricity Board.
Company has plans to carry on the business of manufacturing and trading in commodities of all or Ammonium sulphate, nitrate, Ammonium nitrate, Calcium ammonium nitrate, Ammonium chloride super phosphate urea and other types of fertilizers of synthetic or natural origin containing nitrogen phosphorus or other compounds soda ash, pesticides, DDT seeds, processed seeds, concentrate for cattle or poultry feed.
Valuation—
Company is having strong presence in agro-chemical business. At current market price, stock is trading at 19.2 P/E multiple of its FY2011 estimated EPS. We recommend investors to buy "United Phosphorus" with long-term investment horizon.
Source: Internet (Valuenotes by Abhishek Jain)
Sector — Agrochemicals
Regd.Off.— A-2/1, G. I. D. C., Vapi, Valsad, Gujarat-396195
Listed — NSE, BSE.
Company overview—
United Phosphorus Ltd, formerly known as Search Chem Industries Ltd, a subsidiary of erstwhile United Phosphorous Ltd is into manufacture of Chlor alkali products, Industrial chemicals and speciality chemicals. Company was incorporated as Vishwanath Commercials on Jan 2, 1985 was originally promoted by Debisingh Shekhawat, Lalit Kumar Sharma and Associates and went public in Feb 1985. United Phosphorus acquired 75% equity in Search Chem in March 1995 and UPL acquired further shares in Aug 1995 and became the promoter of the company. Subsequent to takeover it diversified into manufacture of chemicals. The company entered into manufacture of Chlor-alkali products by commercialization of Phase I of its Caustic and Chlorine and Phosphorus Trichloride plants in 1995-96. During 1998-99, company has installed a new plant to manufacture Phosphorus Oxychloride and also installing a plant to manufacture Elemental Phosphorus as a main input of the company. Company has an agreement with General Electric Energy Plant Operations LP for operation and maintenance of power plant. During the 2004-05, company has enhanced its installed capacity of Pesticides and Pesticides Intermediates by 9940 Ton and 890 Ton. Resultant with this expansion of the total installed capacity of Pesticides and Pesticides Intermediates has increased to 28040 Ton and 17546 Ton respectively.
Products & Services—
Company is the largest producer in India of crop protection products. Company has a wide range of products include fumigants, fungicides, insecticides, rodenticides and herbicides. Company ranks fourth amongst the generic agrochemical companies in the world. It is the world's largest producer of Aluminium Phosphide, which is manufactured at one of our manufacturing sites in India and Napropamide, which is produced by one of the company's subsidiaries in the UK. Company manufactures Iso Propyl Bromide, Thi Diphenol and Other Specialty Chemicals 600 TPA, Phosphorus Pentoxide 500 TPA & Phosphorus Penta Chloride 350 TPA. Company is a leading manufacturer of chlorine and Phosphorous based industrial chemicals and speciality chemicals like Phosphorus Pentachloride, Phosphorus Trichloride, Phosphorus Oxychloride, HEDP, Tri Phenyl Phosphite, Tri Phenyl Phosphate, ATMP etc. Comapany is also into power generation. The surplus power after captive consumption is sold to Gujarat Electricity Board.
Company has plans to carry on the business of manufacturing and trading in commodities of all or Ammonium sulphate, nitrate, Ammonium nitrate, Calcium ammonium nitrate, Ammonium chloride super phosphate urea and other types of fertilizers of synthetic or natural origin containing nitrogen phosphorus or other compounds soda ash, pesticides, DDT seeds, processed seeds, concentrate for cattle or poultry feed.
Valuation—
Company is having strong presence in agro-chemical business. At current market price, stock is trading at 19.2 P/E multiple of its FY2011 estimated EPS. We recommend investors to buy "United Phosphorus" with long-term investment horizon.
Source: Internet (Valuenotes by Abhishek Jain)
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