HP Adhesives Ltd - Stock Valuation and Financial Performance

BSE: 543433 | NSE: HPAL | Chemicals | Small Cap

HP Adhesives Share Price

102.68 -1.25 -1.20%
as on 12-Apr'24 16:59

DeciZen - make an informed investing decision on HP Adhesives

Overall Rating
Bole Toh

1. Quality

2. Valuation

Somewhat overvalued

3. Price Trend

HP Adhesives stock performance -

mw4me loader
P/E Ratio (SA):
50.09
Market Cap:
943.4 Cr.
52-wk low:
69
52-wk high:
131

Is HP Adhesives Ltd an attractive stock to invest in?

1. Is HP Adhesives Ltd a good quality company?

Past 10 year’s financial track record analysis by Moneyworks4me indicates that HP Adhesives Ltd is a below average quality company.

2. Is HP Adhesives Ltd undervalued or overvalued?

The key valuation ratios of HP Adhesives Ltd's currently when compared to its past seem to suggest it is in the Somewhat overvalued zone.

3. Is HP Adhesives Ltd a good buy now?

The Price Trend analysis by MoneyWorks4Me indicates it is Weak which suggest that the price of HP Adhesives Ltd is likely to Fall in the short term. However, please check the rating on Quality and Valuation before investing.

10 Year X-Ray of HP Adhesives:

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end.

Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
HP Adhesives Ltd has not performed well majority of the past ten years indicating its past ten year financial track record is not good

Value Creation

Value Creation Index Colour Code Guide

Mar'16Mar'17Mar'20Mar'21Mar'22Mar'23TTM
ROCE % 0%0%5.1%25.1%7.4%8.5%-
Value Creation
Index
NANA-0.60.8-0.5-0.4-

Growth Parameters

Growth Parameters Colour Code Guide

Sales 0084.5118165233235
Sales YoY Gr.-NANA39.8%39.3%41.6%-
Adj EPS 0001.50.61.22.1
YoY Gr.-NANA15000%-60.9%110.2%-
BVPS (₹) 000.421516.117.8
Adj Net
Profit
000.19.85.411.419
Cash Flow from Ops. 000.711.3-10.2-5.1-
Debt/CF from Ops. 0054.23.8-1.3-0.9-

CAGR

CAGR Colour Code Guide

9 Years 5 Years 3 Years 1 Years
Sales NANA40.2%41.6%
Adj EPS NANA398.7%110.2%
BVPSNANA248.9%8%
Share Price - - - 38.9%

Key Financial Parameters

Performance Ratio Colour Code Guide

Mar'16Mar'17Mar'20Mar'21Mar'22Mar'23TTM
Return on
Equity %
003.4129.57.2812.1
Op. Profit
Mgn %
00510.16.4812.1
Net Profit
Mgn %
000.18.33.34.98
Debt to
Equity
0014.13.30.10-
Working Cap
Days
00015918318084
Cash Conv.
Cycle
00082707862

Recent Performance Summary

Sales growth is growing at healthy rate in last 3 years 40.22%

Net Profit is growing at healthy rate in last 3 years 398.66%

Return on Equity has declined versus last 3 years average to 12.10%

Sales growth is not so good in last 4 quarters at 4.40%

Latest Financials - HP Adhesives Ltd.

Standalone Consolidated
TTM EPS (₹) 2.1 -
TTM Sales (₹ Cr.) 235 -
BVPS (₹.) 17.8 -
Reserves (₹ Cr.) 145 -
P/BV 5.78 -
PE 50.09 -
From the Market
52 Week Low / High (₹) 68.99 / 131.00
All Time Low / High (₹) 61.96 / 131.00
Market Cap (₹ Cr.) 943
Equity (₹ Cr.) 18.4
Face Value (₹) 2
Industry PE 49.3

Management X-Ray of HP Adhesives:

Shareholding Pattern

Promoter's Holding & Share Pledging

Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)

Event Update

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Analyst's Notes

Key Ratios of HP Adhesives

Adj EPS (Rs.)

Sales (Cr.)

ROE (%)

ROCE (%)

Profit And Loss

(All Figures are in Crores.)
PARTICULARSMar'20Mar'21Mar'22Mar'23
Sales85118165233
Operating Expenses 80106154214
Manufacturing Costs3347
Material Costs5481121168
Employee Cost 11141620
Other Costs 1271318
Operating Profit 4121119
Operating Profit Margin (%) 5.0%10.1%6.4%8.0%
Other Income 2643
Interest 3332
Depreciation 2233
Exceptional Items -700-1
Profit Before Tax -513815
Tax -1324
Profit After Tax -510611
PAT Margin (%) -5.6%8.5%3.6%4.7%
Adjusted EPS (₹)-0.71.60.71.2
Dividend Payout Ratio (%)0%0%0%0%

Balance Sheet

(All Figures are in Crores.)
PARTICULARSMar'20Mar'21Mar'22Mar'23

Equity and Liabilities

Shareholders Fund 213137148
Share Capital 13131818
Reserves -110119130
Minority Interest0000
Debt3431103
Long Term Debt1943
Short Term Debt342350
Trade Payables15263120
Others Liabilities 2181613
Total Liabilities 5488194184

Fixed Assets

Gross Block19293855
Accumulated Depreciation8101316
Net Fixed Assets11192639
CWIP 171817
Investments 0000
Inventories19324145
Trade Receivables20233237
Cash Equivalents 11481
Others Assets363045
Total Assets 5488194184

Cash Flow

(All Figures are in Crores.)
PARTICULARSMar'20Mar'21Mar'22Mar'23
Cash Flow From Operating Activity 111-10-5
PBT -513815
Adjustment 4445
Changes in Working Capital 2-4-20-20
Tax Paid 0-2-2-3
Cash Flow From Investing Activity -5-16-678
Capex -5-16-16-16
Net Investments 00-5221
Others 0012
Cash Flow From Financing Activity 4586-12
Net Proceeds from Shares 001180
Net Proceeds from Borrowing 018-11-4
Interest Paid -3-3-3-2
Dividend Paid 0000
Others 6-10-18-6
Net Cash Flow -109-10
PARTICULARSMar'20Mar'21Mar'22Mar'23
Ratios
ROE (%)-190.34132.868.017.6
ROCE (%)-7.5334.1810.9711.41
Asset Turnover Ratio1.551.661.171.23
PAT to CFO Conversion(x)N/A1.1-1.67-0.45
Working Capital Days
Receivable Days86666154
Inventory Days80798267
Payable Days103928756

HP Adhesives Ltd Stock News

HP Adhesives Ltd FAQs

Company share prices are keep on changing according to the market conditions. The closing price of HP Adhesives on 12-Apr-2024 16:59 is ₹102.7.
Market capitalization or market cap is determined by multiplying the current market price of a company's shares with the total number of shares outstanding. As of 12-Apr-2024 16:59 the market cap of HP Adhesives stood at ₹943.4.
The latest P/E ratio of HP Adhesives as of 12-Apr-2024 16:59 is 50.09.
The latest P/B ratio of HP Adhesives as of 12-Apr-2024 16:59 is 5.78.
The 52-week high of HP Adhesives is ₹131.0 and the 52-week low is ₹68.99.
The TTM revenue is Trailing Twelve Months sales. The TTM revenue/sales of HP Adhesives is ₹234.5 ( Cr.) .

About HP Adhesives Ltd

HP Adhesives was originally formed as a partnership firm under the name and style of M/s. H.P. International pursuant to a deed of partnership dated January 01, 1987. M/s. HP International was thereafter converted into a private limited company HP Adhesives Private Limited on May 07, 2019, pursuant to the provisions of Chapter XXI of the Companies Act. Subsequently, the company has been converted into a public limited company and the name of the company changed to “HP Adhesives Limited” pursuant to a special resolution passed at the Extra-Ordinary General Meeting of the company held on June 23, 2021 and a fresh Certificate of Incorporation dated July 01, 2021 issued by the RoC.

The company has a robust business model aimed at consistently expanding its product portfolio by introducing new product categories as well as SKUs to cater to multiple end-use applications which are sold through its distribution network across India. With strict focus on product quality and long-standing track record in the distributor network, it has an established brand image which helps it in penetrating new product categories. The company constantly engages with its distributor network through marketing and promotional activities and also conduct a range of activities such as distributor meets, retailer meets and plumber and carpenter meets which leads to promotion of its product brands.

Business area of the company

The company is a fast-growing multi-product, multi-category consumer adhesives and sealants company. For its largest product category - PVC solvent cement, it is amongst the leading manufacturing companies in India in the consumer/ bazaar segment of the adhesive industry. It manufactures a wide range of consumer adhesives and sealants such as PVC, cPVC and uPVC solvent cement, synthetic rubber adhesive, PVA adhesives, silicone sealant, acrylic sealant, gasket shellac, other sealants and PVC pipe lubricant which are sold across India, through an extensive distribution network of distributors, and exported also to several countries, through network of distributors and direct customers. It also manufactures these products for select large PVC pipe manufacturing companies under co-branding or private label on order basis. Apart from the above products, it also sells ancillary products like ball valves, thread seal and other tapes and FRP products for drainage and architectural solutions that are distributed along with its products to the end customers through its distribution network.

Key events and milestones

  • 1987: Partnership Firm in the name and style of H.P. International founded by Haresh Dhanraj Motwani and Seema Abhichandani
  • 1988: Established manufacturing plant at Andheri East, Mumbai.
  • 2001: Reconstitution of partnership firm, H.P. International with Haresh Dhanraj Motwani and his wife, Anjana Haresh Motwani as partners.
  • 2004: Launch of brand ‘Strong Weld’.
  • 2004: Shifted manufacturing facility to Village Padghavalli, Raigad, Maharashtra for manufacturing of PVC solvent cement.
  • 2007: Karan Haresh Motwani, the company's Promoter, admitted as a Partner to the partnership firm, H.P. International.
  • 2012: Shifted manufacturing facility to Village Narangi, Raigad, Maharashtra.
  • 2011: Received NSF International Certification for manufacturing solvent cements.
  • 2018: Commenced manufacturing synthetic rubber adhesives and PVA adhesives.
  • 2019: Commenced manufacturing of silicone sealants and gasket shellac.
  • 2019: Conversion of the company’s business from partnership firm to private limited company.
  • 2019: Started trading in Ball Valves, PTFE and Masking Tape.
  • 2021: Conversion of the Company from private limited to public limited company.
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