Last Updated on: 9th June 2024, 11:11 am
Dear investors this article is about a defence stock in which Ashish kacholia has invested and the stock has given more than 300% return in last one year and 75% return in last one month. Although the stock has run so much the potential can be still a long way to go.read here in detail about the company.
About the company
Krishna defence and allied Industries Limited was incorporated in 1996 develop manufacture and design Defence application products and Dairy equipment products. The company has two plants located in Gujrat Kalol and Halol district near Vadodara.
The company was started actually by Mr. Aswin Shah,he was double engineer,electrical and mechanical. The comapny initially was started as engineering company,to manufacture equipment for milk and dairy industry.
It was in the year 2006-2007, that the company got an opportunity to supply a product called Bulb Bar for the naval ships for the defence. They grabbed the opportunity and continued to work on it.
The company has in house NABL accredited lab ,which helps in developing solutions for defence which is homegrown and thus helps in replacing imported products.
The company works in three business verticals :
A) Defence
The company provides high performance defence products for naval application and many other related usessuch as special steel alloy bricks used as ballast weight for critical applications,flux and electrodes,containers for food ,space heating device known as Bukhari.
Customers for Defence products :
The main Customers for defence products are Mazagaon shipbuilders ltd,Garden Reach Shipbuilders & Engineers Ltd.,Goa Shipyards Ltd.
B) Dairy
The comapny has originally started their business as dairy equipment manufacturer. In this segment they have developed wide range of products.Some of the products are Milk cooling tanks,Milking macnines,Robotic milk Collection unit,Stainless steel milk Cans.
The Company has acquired a patent in 2015 for automated milkanalysys and collection apparatus called RMCU(Robotic Milk Collection Unit) ,valid till 2035.
Customers
Some of the esteemed customers are Hatsun Agro Products Ltd,Delicia Foods India Pt Ltd,The panchamahal District Co operative Milk Producers ‘Union Ltd.
C)Kitchen Equipment.
The company is mainly into bulk cooking equipment Dal cauldron,Rice Cauldron,Distribution vessel,Dal storage tank. These equipments are mainly used in organisation which supply food in bulk like one running mid day meal programme.At present the company is supplying this to The Akshay Patra Foundation
New Vertical
The company has also entered into new vertical in 2020 ,of manufacturing and marketing of Homeland and security products, it manufacturers automatic tyre killer, long range LED searchlight used by armed forces.
New Product development
The company in its conference call has said that it is working on some new products like ,fire resistant doors and hatches ,ammunitions, and radio frequency optical fibres,for which the company has receieved contract worth Rs.3 crore.
The company is also partnering with Netherland for some of these product,so they don’t have to start the product from scratch ,rather they can start the manufacturing direct.
Order book and Capex
At the end of H1’Fy 24 the order book stand at Rs200 cr aprox,and the company is expecting a capex of 1.5 to 2 cr .
The company is eyeing to double its capacity as they are expecting a increased demand for some of their product,so that they can avoid any situation where there is a demand and they are not able to supply.
Company financials
| Market cap | Rs.928 cr |
| 52 Week high | Rs.774 cr |
| 52 week low | Rs.171 |
| Face value | Rs.10 |
| Promoter Holding | 68.33% |
| Asish Kacholia | 3.42% |
The company has made a sales of Rs.106 cr for the year ended March’ 24 and has earned a net profit after tax of Rs 10 cr.The Reserves stood at Rs.85 cr. The company is almost debt free ,with toal borrowing at Rs.9 cr.
H2 FY 24 Result
The net profit for the half year ended 31st March 2024 is Rs.716.06 lacs as against half year ended september, 2023.of Rs.262.90 lacs, a 172 % jump in Net profit
Profit for the year ended 31st March 2024 please rupees 978.96 lacs as against net profit of Rs.529.59 lacs for the year ended 31st March ,2023.
Analysis
The company has a healthy Balance sheet with low debt and average Reserve.The company has entered into various licensing agreement with DRDO to acquire know how to enable manufacturing ofdifferent defence equipment. The promoter holding is also good and the investment in the company by ace investor Ashish Kacholia further strengthen the faith in the company. But as the company is listed in NSE SME palatform,the investment is to be done in lot size,which is a resisting factor for investment by retail investors.At current market price it would require an investent of about minimum 3.5 lacs with lot size of 500 shares.
Disclaimer: Mint Mantra provides the articles and information gathered from other sites like company website and declaration to exchange and is for informational purpose only and this should not be construed as any advice for investment of any kind.Readers are suggested to consult the qualified financial consultant before making any investment decision