Kothari Petrochemicals Analysis

dividend

Pros

• Dividends paid are thoroughly covered by earnings (7x coverage).
• Kothari Petrochemicals's pays a higher dividend yield than the bottom 25% of dividend payers in India (0.76%).
• Kothari Petrochemicals's dividend is above the markets top 25% of dividend payers in India (3.08%).

Cons

• Kothari Petrochemicals has only been paying a dividend for 8 years, and since then there has been no growth.
• Kothari Petrochemicals has been paying a dividend for less than 10 years and during this time payments have been volatile (annual drop of over 20%).

health

Pros

• Kothari Petrochemicals is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
• Kothari Petrochemicals is profitable, therefore cash runway is not a concern.
• Kothari Petrochemicals is profitable, therefore cash runway is not a concern.
• Debt is well covered by operating cash flow (190.4%, greater than 20% of total debt).
• Debt is covered by short term assets, assets are 3.4x debt.
• Kothari Petrochemicals's cash and other short term assets cover its long term commitments.
• The level of debt compared to net worth has been reduced over the past 5 years (33.4% vs 15.6% today).
• Interest payments on debt are well covered by earnings (EBIT is 13.9x coverage).
• Kothari Petrochemicals's level of debt (15.6%) compared to net worth is satisfactory (less than 40%).

Cons

• High level of physical assets or inventory.

management

Pros

• The tenure for the Kothari Petrochemicals board of directors is about average.
• Arjun's compensation has been consistent with company performance over the past year, both up more than 20%.

Cons

• Arjun's remuneration is higher than average for companies of similar size in India.
• The average tenure for the Kothari Petrochemicals management team is less than 2 years, this suggests a new team.

misc

Pros

Cons

• Kothari Petrochemicals is not covered by any analysts.
• Kothari Petrochemicals has significant price volatility in the past 3 months.

past

Pros

• Kothari Petrochemicals's 1-year earnings growth exceeds its 5-year average (163.2% vs 12.3%)
• Kothari Petrochemicals's year on year earnings growth rate has been positive over the past 5 years.
• Kothari Petrochemicals used its assets more efficiently than the IN Chemicals industry average last year based on Return on Assets.
• Kothari Petrochemicals has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
• Kothari Petrochemicals has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).
• Kothari Petrochemicals's earnings growth has exceeded the IN Chemicals industry average in the past year (163.2% vs 9.1%).

Cons

value

Pros

• Kothari Petrochemicals is good value based on earnings compared to the IN Chemicals industry average.
• Kothari Petrochemicals is good value based on earnings compared to the India market.
• KOTHARIPET matched the India Market (-14.5%) over the past year.
• NSEI:KOTHARIPET is up 26.2% outperforming the Chemicals industry which returned 6.9% over the past month.
• NSEI:KOTHARIPET is up 26.2% outperforming the market in India which returned 8% over the past month.

Cons

• Kothari Petrochemicals's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).
• Kothari Petrochemicals's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).
• Kothari Petrochemicals is overvalued based on assets compared to the IN Chemicals industry average.
• KOTHARIPET underperformed the Chemicals industry which returned 2.2% over the past year.