Finolex Industries Ltd Stock Research

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Finolex Industries Ltd Detail

Finolex Industries Ltd is in portfolio of Anuj Anantrai Sheth. He is one of the top investors in India. The company belongs to Pipes sector. 

As per the Company website it is India’s leading manufacturer of PVC-U Pipes and Fittings and the second largest manufacturer of PVC Resin. The Company work can be divided into two parts

  • PVC U Pipes division
    • It has manufacturing plant in Pune, Ratnagiri and Masar. It has combined capacity of 250,000 m.t.p.a
  • PVC Resin division
    • The resin manufacturing plant is in Ratnagiri. It manufactures both suspension and emulsion PVC. It has annual output of  272,000 m.t.p.a.

The products from Company can be divided into below groups

  • Agriculture Pipes and Fittings
  • Casing Pipes
  • Column Pipes
  • Solvent Cement
  • ASTM Pipes and Fittings
  • FlowGuard CPVC Pipes and Fittings
  • Sewerage Pipes
  • SWR Pipes and Fittings

The products from Company are mainly used in Agriculture sector and Non Agriculture sector like Construction, Industrial and Housing.

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I have shared long term price performance chart of the Company below.As per Dow theory of technical analysis price performance over a period of time reflects Company state.

Finolex Industries Ltd Stock Performance

The stock has given more than 15 times return in past 16 years or so.It was an under performing stock till year 2013 giving only 2 times return to investor. Majority of price action came during bull run which started in year 2014. From that point onward it made significant move.

During that phase majority of stocks in building material segment performed well. For new investors I think it is best to wait for sometime as after decent run every stock takes a back seat. The dividend yield is also good at current market price.

Finolex Industries Ltd My Opinion

Finolex Industries Ltd is a Pipes Company.The product from the Company are used in Agriculture segment as well as Building material sector. Both of these two sectors are growth sectors.

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Irrigation is major issue in India where cultivation depends on Monsoon. So usage of pipes and other products from the Company will have usage. Similarly building materials sector is growth sector and there are many local players in market. Established players have scope to eat on the smaller players and gain market share.

This stock is also dependent on Oil prices. The rising Oil prices will have adverse impact on Stock price and Company performance. So you need to take this point into consideration.

I do not have any pipe stock in my portfolio though I do have building material stock. I have Paints stock so I do not want to include too many Oil dependent stock in my portfolio.

In case you are interested then you can track the company by adding it to your stock watch list. That way you can keep close eye on the Company.

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