Overview
Harrisons Malayalam is one of the most leading integrated agricultural operation in South India.It runs plantations for Tea, Rubber, Cocoa, Coffee and a wide variety of Spices.
Below are some key important points about the Company which makes it unique
- It is India’s largest cultivator of Rubber (Natural Rubber).
- It is second largest producer of Tea.
- It is largest producer of Pine Apple as well
- It has also ventured into new crops to diversify dependence on Tea and Rubber.
- The other crops are Areca nut, Banana, Cardamom, Cocoa, Coffee, Coconut, Pepper and Vanilla as well as limited quantities of Organic tea and spices
The company is part of RP-SG and RPG Enterprises. Other notable Companies from this Group are Zensar Technologies, CEAT Tyres, KEC International and First Source.
It provides good amount of Employment to Rural India (in states of Kerala, Tamilnadu and Karnataka).
It also exports these products to other Countries as well. It has also ventured into Consumer Products as well. Below brands of products are from this Company
- Tea variants like Surianalle, Chundale, White and Green
- Spices like Pepper, Cardamom and Clove
- Jackfruit desserts
So the Company is trying to enter in Food Processing and creating own set of brands. This is good news for investors and if performed with care may trigger reevaluation of the Company.
Stock Performance
Above is long term price performance chart of the Company. As you can clearly see above it has not given secular growth. So it is not buy and hold type of stock. But it has given 5 times return or more if bought at lower levels.
From year 2002 to 2005, from year 2008 to 2010 and then from 2014 to 2018 it has given good returns but trick it investing at right levels. Since it is based on Agriculture so by nature it is cyclic stock and should be played that way only.
My Opinion
Harrison Malayalam is Agriculture based Company. Majority of products from Company are Agriculture products. It is coming up with its own brands which may propel next set of development.
If it can commercialize the agriculture product to brands then it has good potential. The backward integration will immensely help the Company. It is best to keep an eye on this Company because it is backed by decent Group which has experience.
It has also ventured into new products that would lessen its dependency on Rubber. Artificial rubber is substituting natural rubber so dependency on rubber for major revenue will not be good idea. This has to diversified with presence in tea, Spices and fruits along with products based on these things.
I would track this Company and see if it can turn around. If it does then it would be good place to make money.