POLYPLEX : Expecting a minimum of 20% in the near term
Pros
1. Dividend yield of 6.92% is being offered at the current levels which is very attractive especially for a small cap company.
2. The products have multiple usage across various industries since they are mainly into plastic packaging business.
3. Inflation and war scenarios in US and Russia has effected the demand and in turn effected their profit margin. 49% of their revenue in FY 22 was from US and Europe. So since these situations are over to some extend the demand is likely to grow in upcoming quarters.
Cons
1. Cyclical nature of plastic film sector.
2. If crude oil prices increase then the price of resin increases which is a byproduct of refining crude. This resin is the main raw material for producing plastic films.
Conclusion
Already had the position in the portfolio for quite a while for about 3.75% of the capital. Added one more 1.25% of the capital and summed up the total holding to 2.5%. Will hold onto the position for a minimum of 20% move to the top of the channel and depending on the market conditions at that time I might even consider holding it further.
1. Dividend yield of 6.92% is being offered at the current levels which is very attractive especially for a small cap company.
2. The products have multiple usage across various industries since they are mainly into plastic packaging business.
3. Inflation and war scenarios in US and Russia has effected the demand and in turn effected their profit margin. 49% of their revenue in FY 22 was from US and Europe. So since these situations are over to some extend the demand is likely to grow in upcoming quarters.
Cons
1. Cyclical nature of plastic film sector.
2. If crude oil prices increase then the price of resin increases which is a byproduct of refining crude. This resin is the main raw material for producing plastic films.
Conclusion
Already had the position in the portfolio for quite a while for about 3.75% of the capital. Added one more 1.25% of the capital and summed up the total holding to 2.5%. Will hold onto the position for a minimum of 20% move to the top of the channel and depending on the market conditions at that time I might even consider holding it further.
Trade active:
The current average value is around 1416.35 for about 2.5% of the capital.