KS Oils: Long term Pick

Background

KS Oils Limited specialises in manufacturing and dealing in oils, vegetable oils and fats, products of plantation, soaps and allied products. The company has sown aggressive expansion strategy. This is apparent from the fact that the book value of this company has shown an average growth of over 40% in the past 5 years or so. It entered a Joint Venture in malaysia in 2007 with a 49% stake with the goal of investment and acquisition of Palm plantations and production of Palm Oil. Overall this company fits my initial filters: it has been running for more than a decade and has shown reasonable growth and expansion potential.

Financials

The stock KSOILS seems to have been extremely popular even in the 2007 bull run. However it has lost over 75% of its peak value and reached a bottom at around 30. Whether it will still drop providing a nice entry point like Rs. 30/- per stock, i really dont know. That is the reason I find it hard to make a decision of whether to invest at its current price of Rs. 55/-. Frankly i think at the price of 55/- (its current P/E ratio would be around 11) it is a reasonable deal. I will make a one more post under Stock tips when/if i decide to invest in this stock and also specific targets and stop loss that i have in mind. Till then you can have a look at its latest Price-Volume chart (automatically updated daily by Icharts)