Q1 FY11 Results Update Astral Poly Technik Ltd

Recommendation Hold
Astral has come out with Q2FY11 results, both revenue and
CMP (16/11/2010) Rs.165 profitability inline with our expectations
Sector Plumbing Material
• Revenue for the Q2FY11 stood at Rs 99.6 crores, up by 46.2% on
Stock Details
YoY basis and up by 40.2% on QoQ basis. Increase in revenue is
BSE Code 532830
driven by volume growth of 36.27% on QoQ basis to 6613 Tons.
NSE Code ASTRAL
Market Cap (Rs. cr) 393.86 • EBITDA increased by 47.2% on YoY basis to Rs 13.7 crores in
Free Float (%) 36.18% Q2FY11, on QoQ basis it grew by 51.0% from Rs 9.0 Crores.
52- wk HI/Lo 190/67
• EBITDA margins improved by 99 bps to 13.8% on QoQ basis
Avg. volume (Monthly) 12167
whereas on YoY basis it stood flat. During the quarter it has
Dividend 20%
passed on increased raw material cost partially ie, from august.
Shares o/s (Crs) 2.24
Relative Performance 1Mth 3Mth 1Yr • Adjusted PAT up by 51.6% on YoY basis to Rs 7.7 crores, and on
ASTRAL -2.3% 41.5% 137% QoQ basis it has increased by 77.1%.
• Adjusted PAT margins for Q2FY11 stood at 7.9% as against 7.6%
SENSEX -0.3% 12.0% 26.0%
in Q2FY10 and 6.3% in Q1FY11.
Key Highlights during the Quarter
• Astral is ramping up its capacity from 30800 MT to 45000 MT by
December 2010.
• Astral has received ISI certification for its CPVC pipes which
would enable to sell the products in Government segment.
• During the current quarter it has added one more product to its
portfolio by launching higher sizes of underground chambers
and manholes in the Indian market.

Shareholding Pattern as of 30/09/2010 Valuation & Recommendation

Promoters Holding 63.82% We have recommended the stock with the target price of Rs 138
(Post split) in last update based on FY11 estimates, which has
FII, banks & Institutions 1.76%
been already achieved. We have revised our estimates by
Corporate Bodies 4.94% increasing the Revenues & PAT by 7.8% and 15.3% repectively
Public & others 34.42% for FY11 and introduced FY12 estimates. Based on our revised
Sunil Jain VP Research (022-30272377) estimated EPS of 15.2 and 19.7 for FY11E and FY12E, at the CMP
Sunil.jain@nirmalbang.com of Rs 165 the stock is trading at a PE of 10.9 & 8.4x for FY11E &
Venugopal Kasat (022-30278203) FY12E. We recommend to Hold the stock with the target price of
venugopal.kasat@nirmalbang.com Rs 197 indicating upside potential of 19%.

EBIDTAM Growth EPS

Year Net Sales Growth % EBIDTA (%) PAT (%) (Rs.) P/E(x) P/BV
FY09A 192.7 41.8% 29.2 15.16% 20.5 27.61% 9.1 20.5 9.2
FY10A 290.4 50.7% 41.7 14.36% 27.7 35.41% 12.3 15.2 7.2
FY11E 406.6 40.0% 57.9 14.24% 34.1 23.11% 15.2 12.3 2.8
FY12E 540.0 32.8% 76.4 14.14% 44.2 29.64% 19.7 9.5 2.2
Q1 FY11 Results Update Astral Poly Technik Ltd

Going Forward
The demand from the real estate industry is continuing which it had started picking up
after slow down. The advantages of CPVC products and its acceptance as alternate to GI
pipes will supplement the demand. Its ability to pass on the increased raw material
prices and the appreciating rupee will enable it to maintain decent operating margins.
We believe the robust demand, decent operating margins coupled with factors like
market leader, increasing product mix will lead to growth in revenue and earnings.

Key Points
• The Nairobi facility (Astal has 32% stake) which was scheduled to commence in
Q2FY10 has been delayed due to availability of rawmaterial. It is expected to
commence the facility be November 2010.

• The company has acquired 85% stake in Advanced adhesives Ltd (AAL) which
will be manufacturing solvent cement. AAL will be setting up plant next year
and will make an investment of around Rs 4 Crores.

Quarterly Analysis

YoYVar(%) QoQVar(%)
Financials Q2FY11 Q2FY10 Q1FY11
Net Sales & operating
income 99.8 68.3 46.1% 71.2 40.2%
EBITDA 13.7 9.3 47.2% 9.1 51.0%
Other Income 0.4 0.3 20.6% 0.3 20.6%
Depreciation 2.6 2.1 25.4% 2.5 5.2%
EBIT 11.5 7.6 52.0% 6.9 66.0%
Interest 1.2 1.0 14.4% 1.2 2.6%
PBT 10.3 6.5 58.0% 5.8 78.7%
Extraordinary Items -1.4 0.6 1.2
Tax, Deferred Tax & FBT 2.1 1.5 45.9% 1.6 32.3%
PAT 6.8 5.6 21.3% 5.4 27.4%
Adj. PAT 7.9 5.2 51.6% 4.4 77.1%
Equity Capital (Rs.5) 11.2 11.2 0.0% 11.2 0.0%
EPS 3.0 2.5 21.3% 2.4 27.4%
Adj. EPS 3.5 2.3 51.6% 2.0 77.1%
Ratios
Operating profit margins (%) 13.8 13.7 10 12.8 99
Adj. NP margin (%) 7.9 7.6 29 6.2 165
 Q1 FY11 Results Update Astral Poly Technik Ltd
Financials
Financial Health (Rs. In
Profitability (Rs. In Cr) FY09A FY10A FY11E FY12E Cr) FY09A FY10A FY11E FY12E
Y/E - March Y / E - March
Revenues - Net 192.7 290.4 406.6 540.0 Share Capital 11.2 11.2 11.2 11.2
% change 41.8% 50.7% 40.0% 32.8% Pref Share/ Sh App 0.0 0.0 0.0 0.0
EBITDA 29.2 41.7 57.9 76.4 Reserves & Surplus 80.1 105.2 136.7 178.3
% change in EBIDTA 39.6% 42.8% 38.8% 31.9% Net Worth 91.4 116.5 147.9 189.6
Interest 5.3 4.9 6.5 8.0 Total Loans 39.0 41.3 51.4 62.9
EBDT 23.9 36.8 51.4 68.4 Deferred Tax Liabilities 1.7 1.7 1.7 1.7
Depreciation 6.2 8.6 10.8 13.1 Total Liabilities 132.1 159.4 201.0 254.2
Other Income 5.7 5.2 2.0 0.0 Net Fixed Assets 88.3 97.5 116.7 138.7
Extraordinary 5.8 -0.9 0.0 0.0 Investments 0.0 0.0 0.0 0.0
PBT 16.1 33.4 42.7 55.3 Inventories 49.8 70.3 88.5 117.6
Tax 2.1 5.7 8.5 11.1 Sundry Debtors 40.9 67.6 89.8 126.7
PAT 14.0 27.7 34.1 44.2 Cash & Bank 2.3 4.3 4.7 5.8
Adj PAT 20.5 27.7 34.1 44.2 Loans & Advances 14.2 20.4 25.1 28.3
Shares o/s ( No. in Cr.) 2.2 2.2 2.2 2.2 C A L&A 107.2 162.5 208.1 278.4
EPS 6.2 12.3 15.2 19.7 CL & P 63.4 100.7 123.8 162.9
Adj EPS 9.1 12.3 15.2 19.7 Working Capital 43.8 61.9 84.3 115.5
Cash EPS 9.0 16.2 20.0 25.5 Misc Exp 0.0 0.0 0.0 0.0
DPS (Rs.) 1.0 2.0 2.0 2.0 Total Assets 132.1 159.4 201.0 254.2
Quarterly (Rs. In Cr) Dec.09 Mar.10 June.10 Sep.10 Cash Flow (Rs. In Cr) FY09A FY10A FY11E FY12E
Revenue 67.81 102.09 71.04 99.60 Operating `
EBITDA 10.98 13.90 9.09 13.73 Operating Income 29.2 41.7 57.9 76.4
Interest 1.05 1.24 1.16 1.19 Change in WC -12.0 -16.1 -22.0 -30.0
EBDT 9.93 12.66 7.93 12.54 Other Adjustment -0.2 -0.1 0.0 0.0
Dep 2.20 2.31 2.49 2.62 CF from Opeartion 17.0 25.5 35.9 46.4
Other Inc. 0.23 1.11 0.34 0.41 Investment
Extraordinary -0.41 2.63 1.20 -1.36 Capex -37.2 -17.7 -30.0 -35.0
PBT 7.55 14.09 6.98 8.97 Other Investment 0.0 0.0 0.0 0.0
Tax 1.28 2.36 1.61 2.13 Total Investment -37.2 -17.7 -30.0 -35.0
PAT 6.27 11.73 5.37 6.84 Financing
EPS (Rs.) 2.79 5.22 2.39 3.04 Diviend Paid -1.3 -2.6 -2.6 -2.6
Operational Ratio FY09A FY10A FY11E FY12E Share Capital 0.0 0.0 0.0 0.0
EBITDA margin (%) 15.2% 14.4% 14.2% 14.1% Premium / Reserve 0.0 0.0 0.0 0.0
Adj.PAT margin (%) 10.6% 9.5% 8.4% 8.2% Borrowing 6.9 2.2 10.1 11.5
Adj.PAT Growth (%) 27.6% 35.4% 23.1% 29.6% Other Income -1.7 5.2 2.0 0.0
Price Earnings (x) 20.5 15.2 12.3 9.5 Subsidy Rec 0.0 0.0 0.0 0.0
Book Value (Rs.) 20.3 25.9 65.8 84.3 Interest -5.3 -4.9 -6.5 -8.0
ROE (%) 24.1% 26.7% 25.8% 26.2% Tax Paid -2.1 -5.7 -8.5 -11.1
ROCE (%) 17.5% 26.3% 27.3% 27.8% Total Financing -3.4 -5.8 -5.5 -10.2
Debt Equity Ratio 0.4 0.4 0.3 0.3
Price / Book Value (x) 9.2 7.2 2.8 2.2 Net Chg. in Cash -23.6 2.0 0.4 1.2
EV / Sales 4.6 3.0 1.2 0.9 Cash at beginning 25.9 2.3 4.3 4.7
EV / EBIDTA 30.1 21.1 8.1 6.3 Cash at end 2.2 4.3 4.7 5.8
Q1 FY11 Results Update Astral Poly Technik Ltd

Disclaimer
This Document has been prepared by N.B.Research (Nirmal Bang Securities PVT LTD).The information, analysis and estimates
contained herein are based on N.B.Research assessment and have been obtained from sources believed to be reliable. This
document is meant for the use of the intended recipient only. This document, at best, represents N.B.Research opinion and is
meant for general information only. N.B.Research, its directors, officers or employees shall not in anyway be responsible for the
contents stated herein. N.B.Research expressly disclaims any and all liabilities that may arise from information, errors or omissions
in this connection. This document is not to be considered as an offer to sell, or a solicitation to buy any securities. N.B.Research, its
affiliates and their employees may from time to time hold positions in securities referred to herein. N.B.Research or its affiliates
may from time to time solicit from or perform investment banking or other services for any company mentioned in this document.