- Wealth PMS
As part of our year-end summaries, we look at the top 10 mid-cap performers for 2016 (ending 23-Dec). You can catch our earlier series here:
2016 in Review: The Top 10 Large Cap Performers!
2016 in Review: Metals and Energy Best, Pharma and IT Worst
2015 in Review: Sector Moves Show Pharma Best, Metals Worst
2015 in Review: The Top 10 Large Cap Performers of the Year!
2015 in Review: The Top 10 Mid Cap Performers of the Year!
IMFA is an integrated ferro alloys manufacturing company with major exports to China, Japan and Taiwan. It has a partnership with POSCO of South Korea. The company operates in three segments: Ferro Chrome Ore, Ferro Chrome and Power Generation.
IMFA has returned 272.19% since Jan 1, 2016. IMFA remained almost flat till September due to its dismal performance in June quarter. The Stock rose from 180 levels in September to 558 level by Dec 23. The major reason behind the sharp increase is due to rallying of spot ferro chrome prices. On top of that improving steel prices gave the company much needed relief. Q3 results have been great with an EPS of 16.29.
Shilpi Cables manufactures power cords, wires, connectors and various types of cables and has capacity to produce 1200 kms of radio frequency cables per month. The company plans to increase its production capacity by two fold. It generates 51% of its revenue from overseas markets. Its major raw material is copper. The company is now exploring the LED market.
Shilpi Cables’ revenue almost doubled in H1FY17 compared to H1FY16. Management has also stated that they have taken a hit of 30-35% on the collections due to demonetisation.
Shilpi’s stock has returned 216% for 2016. The major rally came in May 2016 due to falling copper prices. However, copper prices have increased since October 2016. The firm has managed to maintain its profit with high input prices by increasing sales volume. The consolidated EPS of the company for Q2FY17 is at 4.83.
GNFC is a joint venture of the Government of Gujarat and GSFC. GNFC specializes in ammonia-urea fertilizer complexes that include ammonium nitrate products. It also manufactures industrial chemicals such as Methanol, and Formic Acid.
After two consecutive years of drought, predictions of good monsoons increased the sale of fertilizers and also increased demand for industrial chemicals. These factors helped the stock rally, which is up 150% this year. GNFC also had issues with its Dahej TDI manufacturing plant, which suffered a major gas leak, resulting in the death of four contract workers. The Dahej plant was shut down post this incident.
Astec Life Sciences manufactures agro chemicals active ingredients and pharmaceutical intermediaries. They have plants located at Dombivli and Mahad, both in Maharashtra.
Astec life sciences share price increased by 1.43 times since Jan 1 2016. The major rally came after predictions of good monsoons by Indian Met Department and another 35% came after it reported a five fold increase in profits in Q2FY16.
Sudarshan Chemicals is the fifth largest pigment manufacturer in the world. Sudarshan chemicals commands a 35% market share in India. Pigments contribute nearly 89% of its revenue. Sudarshan chemicals caters to clients in automotive paint industry, plastic and rubber industry, agro chemicals etc.
The stock went up from 114 levels at the end of May 2016 to its 52 week high of 453 within a span of three months. But underwent correction at later stages and dropped to 273 levels, ending at a return of 158.8% for the year.
Himadri Chemicals is part of flagship Himadri Group. Himadri is the largest manufacturer of coal tar pitch. Coal tar pitch is used in aluminium and graphite industries. Himadri clientele includes Nalco, Balco, Hindalco, Graphite India and international clients such as Dubal, AOG, Graftech and SGL. Himadri commenced a melting facility in Odisha in September 2016, to cater to local demand.
Dropping coal prices have helped Himadri boost its margins. The stock rallied from 18 levels in June to 33 by December. Overall the stock has returned 128% in 2016.
Bodal Chemicals produces dye intermediaries, dye stuff, sulphur and bulk chemicals. Their key raw materials include sulphur, caustic soda, napthalene and chlorine. Bodal chemicals caters to clients from textile, leather, paper, detergent and water treatment industries.
Shutting down of specialty chemicals firms in China due to compliance issues has provided an edge to Bodal chemicals in the global market. Increased manufacturing cost in China and lack of export incentive in China has proved to be an advantage to Indian firms in this industry.
Bodal Chemicals shot up from 55 levels in Jan to 151 levels in October, but eventually settled down to 120 levels by December. The stock has returned 118.38% for 2016.
Swan energy originally known as swan mills manufacturers cotton and polyester textiles. They currently have a 1 lakh metre/day unit at Ahmedabad. Apart from textiles, Swan also has businesses in real estate and has recently ventured into FSRU based LNG import. The company recently signed an MoU with PETRONASR and Alpha Energy Systems.
Swan energy remained flat at 61-65 levels till October 2016. In four consecutive trading sessions the stock gained by almost 60% and later reached 210 levels in December anticipating government nod for its projects. Post the event, the stock underwent correction and is currently at 150 levels. The stock has returned 117% in 2016.
Orient papers – a subsidiary of CK Birla group – manufactures high strength pulp along with paper and paper products, electric consumer durable etc. Orient Paper Industries are demerging its consumer electric unit and is also in the process of raising capital by rights issue.
Post demonetization the stock has come down by 20%. The stock has returned 106.40% in 2016.
Manappuram Finance operates majorly in retail loans and gold loans. The banking sector has been under stress due to NPA issues with corporate loans. Manappuram with its major exposure to retail loans has not been much affected by NPAs. Its small ticket size and higher collateral value has proved more efficient in repayments and cash collection.
The stock soared from 30 levels in January 2016 to 105 in October. Demonetisation has impacted the firm in terms of cash collections, which in turn affected the stock. The stock has fallen by 40% post demonetization. Even after that fall, the overall returns for 2016 stands at 105%.