CMP-2461
Elantas Beck India is a 63 year old 1000/o debt free , subsidary of Atlanta AG a German chemical company headquartered in Wesel. Elantas Beck India manufactures a wide range of specialty chemicals for electrical insulation and construction industries.
Elantas Beck was Incorporated in Mar.’56, Dr Beck & Company (India) was promoted by Mahindra & Mahindra in collaboration with Dr Beck & Company, Germany. It went public in 1961. Dr Beck & Company (India) has developed over the years, one of the finest and widest ranges of synthetic insulations for the Indian industry. These ranges include wire enamels, varnishes, epoxy and unsaturated polyester resins to meet the needs of various sectors like the private, government and PSUs such as defence, railways, telecommunications, heavy electricals, etc.
Parent History-:
Altana’s roots go back to 1873, when Heinrich Byk founded the chemicals factory Dr. Heinrich Byk Chemische Fabrik in Oranienburg. The Altana Group has 52 production facilities and 60 service and research laboratories worldwide. In 2018, the company, with about 6,400 employees, posted revenues of approximately ā¬2.3 billion. The group comprises the divisions BYK (coating additives and instruments), Eckart (metal effect pigments and metallic printing inks), Elantas (insulation materials for the electrical and electronics industries) and Actega (coatings and sealant compounds for the packaging industry). In pursuit of ALTANA’s global commitment, ELANTAS Beck India develops new products and processes to meet the changing needs of customers
Segment Breakup-:
The Electrical Insulation Business comprising of Wire Enamels and Secondary Insulation products account for approximately 83 `)/0 of the Company’s sales revenue and constitutes the core business of company. Wire Enamel business primarily caters to Magnet Wire manufacturers, whose end customer base span the Home Appliances, Transformers, Automotive and Industrial Segments. Secondary Insulation products like Varnishes find application in Rotating Machines used in Home Appliances, Automotive Components, Industrial Motors, Generators, Transformers apart from the Repair and Refurbishment industry.
Electronic & Engineering Materials business comprises of Electronic & Electrical Compounds (EL), Hardeners and Construction Chemicals (CC) and accounts for approximately 17Ā°/0 of the Company’s sales revenue. The EL Business has specialty products in Electronics, Auto Electricals, Filters & High Voltage Capacitors application,
in addition to emerging opportunities in E Mobility. The CC Business has products for Industrial Flooring, Exterior Coating, Water Proofing, Structural Repairs, Sealants and Adhesives
Financials-:
Net Sales at Rs 107.02 crore in June 2019 up 5.270/0 from Rs. 101.66 crore in June 2018. Quarterly Net Profit at Rs. 12.84 crore in June 2019 up 5.87% from Rs. 12.13 crore in June 2018. EBITDA stands at Rs. 20.28 crore in June 2019 up 5.57Ā°/o from Rs. 19.21 crore in June 2018.
Elantas Beck EPS has increased to Rs. 16.20 in June 2019 from Rs. 15.30 in June 201
Company has about 79.27 Lalh shares of Rs 10 FV out of which 75Ā°/o shares are held by promoter Elantas GMBH which leaves very less free float in the market.
Apart from that comapny has 173Cr worth of invrstments held in various mutual fund schemes and a cash balance of Rs 22 cr up almost 1000/0 from previous year. Also company does not have any debt.
Reserves and Surplus of the company stand around 352 Cr which if the managment chooses to act upon makes Elantas Beck a very good candidate for Bonus/ Split issue.
Although a bit costly on the valuation front, Elantas Beck an foreign subsidary always trade on premium valuations. Some of these companies may not lead to significant capital appreciation but can be a good bet for volatile times.
