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Company Profile: Pidilite Industries – Business Overview with Financials

Pidilite-Logo.png

Pidilite Logo

Pidilite – the makers of hatke ads of Fevicol, Fevi Kwik, Dr. Fixit etc. submitted their latest presentation made to investors and here is a short summary of the company:

Business Overview (Domestic)

The company covers two different segments – the first being Consumer & Bazaar Products while the other being Industrial Products.

The company has a strong hold in most of the segments under Consumer and Bazaar Products which contribute 84% of the company sales and has a lot more headroom for growth:

  • Adhesives & Sealants 53%,
  • Construction/ Paint Chemicals 19%,
  • Art/ Craft Materials & Others 12%

Its Industrial Products group is constituted by Industrial Adhesives & Resins 10% which caters to a diversified user base.

The Industrial Adhesives cater to industries such as packaging, stickers, labeling, and footwear etc. along with serving specialty polymers / co-polymers for various industries such as Paints, non-woven and flocked fabrics, construction chemicals and leather.

On the Organic Pigment & Preparation 6% end, the company has a strong presence in pigment dispersions for Indian textile segment and is a pioneer Pigment Violet 23 manufacturing. Its products are exported to customers in Europe and USA.

Pidilite Products

Business Overview (International)

  • Manufacturing and selling activities in USA, Brazil, Thailand, Bangladesh, Egypt and Dubai with the presence of 16 overseas subsidiaries which generated a total revenue of Rs. 581.9 Cr for FY16.
    • USA (42% of Revenue) : manufactures and sells arts & craft products and automotive after-market chemicals
    • Brazil (17% of Revenue): manufactures and sells adhesives, sealants and construction chemicals.
    • SAARC (23% of Revenue): manufacturing adhesives, sealants & other products and has a construction chemical production facility.
    • Middle East (18% of Revenue): manufactures & sells adhesives, sealants & other products and has a construction chemical production facility.
  • It exports to over 60 countries with the majorly of the exports bring shipped to Middle East, Africa, USA & Europe. The export turnover in FY16 stood at Rs. 452.4 Cr.

Pidilite Industries Share Price 22 June 2016

Growth Factors:

  • Upside potential of GDP growth
  • Rising Urbanization and opportunity in Tier 2/3 states
  • Growth of construction industry

Urbanization Rate

Financials:

Pidilite Financials

Summary:

  • Strong position in most products and segments
  • Portfolio of trusted brands
  • High mix of sale from products / segments
  • Headroom to grow domestic business

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Disclaimer

Nothing in this newsletter is financial advice and should not be construed as such. Please do not take trading decisions based solely on the matter above; if you do, it is entirely at your own risk without any liability to Capital Mind. This is educational or informational matter only, and is provided as an opinion. 

Disclosure: The authors at Capital Mind have positions in the market and some of them may support or contradict the material given above, or may involve a direction derived from independent analysis.