Recommendation from Pharmaceutical company and manufacturing Company

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations.

J.B.CHEMICALS & PHARMACEUTICALS LTD
CMP - ₹1,719.10
BSE CODE 506943
Volume 2,453
Face Value ₹2
Target ₹1,830-1,880
Stoploss ₹1,650 (CLS)

JBCPL is widely committed to manufacturing a range of innovative specialty products that include various pharmaceutical dosage forms like tablets, injectable (vials, ampoules and form fill seal), creams and ointments, lozenges, herbal liquids and capsules. In India and international markets, JBCPL is also known as Unique Pharmaceutical Laboratories and is a division of JBCPL. The company’s quarterly consolidated financials reveal that the operating profit for Q4FY22 is ₹127 crore as compared to ₹149.24 crore for Q4FY21, a marginal decrease of 14.9 per cent. Net sales for Q4FY22 were at ₹624.59 crore, recording an increase of 18.19 per cent as compared to net sales of ₹528.46 crore in the same quarter last year. The net profit has slightly reduced and stands at ₹84.97 crore since the same period which was at ₹100.81 crore in Q4FY21, down 15.71 per cent. The company has recently acquired four brands from Dr. Reddy’s Laboratories in the paediatric segment. The company is almost-debt free and has delivered good profit growth of 20.73 per cent CAGR over the last five years. Hence, we recommend BUY.

ARCHIDPLY INDUSTRIES LTD
CMP - ₹65.50
BSE CODE 532994
Volume 1,82,535
Face Value ₹10
Target ₹72-75
Stoploss ₹55(CLS)

Started in 1976 under the name of Assam Timber Products P Ltd., the company got listed as Archidply Industries Ltd. in 2007. It manufactures plywood, laminates, wood panel and surface decorating products. The company is credited for launching the first low formaldehyde emission plywood in India and is engaged in the business of manufacturing two broad product segments, i.e. wood-based products and paper-based products. The company’s quarterly consolidated financials reveal that the operating profit for Q4FY22 is ₹6.44 crore as compared to ₹4.29 crore for Q4FY21.This shows an impressive increase of 50.2 per cent. Net sales for Q4FY22 were at ₹94.58 crore, recording an increase of 18.04 per cent as compared to net sales of ₹80.13 crore in the same quarter last year. The net profit has jumped to ₹2.90 crore since the same period which was at₹0.26 crore in Q4FY21, a stellar growth by 1,016.92 per cent. The company is expected to perform well in the upcoming quarters due to improved order book and better operating margin. Hence, we recommend BUY.

(Closing price as of July 26, 2022)