The company is engaged in the business of trading chemicals – primarily ‘Phenol’ used for its conversion to plastics and related materials. It operates out of Kolkata. The company owes about 15 crores in loans against equity and reserves of just 2 crores indicating a high risk financial position, particularly in the current period of high interest rates. It is, however, generating 50 lacs of net profits on 117 crores of revenues in the last 12 month indicating wafer-thin profit margins and subject to substantial downside on even marginal declines in revenues. Management has, however, valiantly maintained dividend payouts of about 10% during FY ’10 although that looks increasingly at risk due to the highly leveraged financial position.
An Individual Investor's Perspectives On The Indian Financial Markets