Kwality Limited is India's premier dairy foods company, focuses on building leadership positions in branded and added value markets across the dairy sector http://www.charanwings.com

1. Kwality Limited Multibagger Stock Trading Tips
Company Review
Kwality Limited, formerly Kwality Dairy (India) Limited, is an Indian-based dairy products company is an
Iso 22000:2005 Certified Company registered office is at New Delhi. Mr. Sanjay Dhingra is the Managing
Director, Mr. Sidhat Gupat & Arun Srivastava, Directors and Mr. Dr. Rattan Sagar Khana is an
Independent Director. The Kwality Limited is primarily engaged in the business of manufacturing,
purchase and sale of ghee, skimmed milk powder, curd, whole milk powder, dairy lactose and milk.
The Products of the company were Pure Ghee, 100% Pure Cow Ghee, Livelite-Low Cholesterol Ghee,
Curd, Paneer, Milk, UHT Milk, Skimmed Milk, Dairy Mix, Wake Up- Instant Dairy Creamer, Pasteurized
Table Butter, Yogurt, Sweet and Flavored Milk.
Company Financial View
The KDIL has registered robust results for the quarter ending March 2014. The revenues from operations
grew by ~29 percent to Rs.1317.38 crores vs. Rs.1021.20 cr. in the corresponding quarter last year.
Operating profit climbed sharply by ~69 percent at about Rs.77.60 crores as against Rs.45.88 crores in
the previous year quarter. The adjusted net profit almost doubled at Rs.36.31 crore for the quarter as
compared to Rs.15.02 crore. EPS for the quarter stood at Rs.1.79. On the margins front, operating
margin climbed about 150 bps at 5.89 percent as against 4.49 percent while net profit margin expanded
129 bps at 2.76 percent from 1.47 percent y-o-y.
The Kwality Limited has recently increased its milk prices by Rs. two per liter across all alternate in the
Delhi-NCR region. The company has taken this step as cost of procurement of milk has gone up in
preceding few months. Following the projected increase, the Kwality full cream milk will cost Rs forty
eight per litre, toned milk will be priced at Rs thirty eight a litre and double toned would be available for
Rs thirty four a litre.
The company plans to maintain the growth momentum with the focus on increasing share of branded
and value-added products and emerge as a leading dairy products company.
Company Assessments
With strong brand equity; increasing market presence and customer reach; increasing product portfolio;
expansion plans and strong financial performance; Kwality Ltd. growth prospects and profitability seem
optimistic. We believe the company is trading at an attractive valuation at 4.49x and 3.29x of FY15EPS of
Rs.10.02 and FY16EPS of Rs.13.68. We recommended buying near Rs. 49-45 levels for investment
horizon; it may touch Rs. 75 in a time period of 6-9 months.
Bse Id: 17897
Nse Id: KWALDAIR
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