Asian Granito is in the business of manufacturing and distributing branded tiles. The company has shown a lot of growth in revenues over the last five years but this hasn’t been reflected in operating profitability presumably due to the effects of greater competition in its business. It reported about 60cr of operating profits on revenues of 480cr of revenues in the last financial year. It operated with a relatively high net debt load of 120cr (as at 31 st March, 2010) – which would cause irritations in a high interest-rate environment (as now) and in the event of margin pressures in the future. It is subject to risks of raw material price spikes (clay, glaze etc.), government policies on excise duties (which fluctuates widely) and competitive pressures in a fast growing industry.
An Individual Investor's Perspectives On The Indian Financial Markets