Page 1 of 5 Company Profile Black Rose Industries Ltd was established in 1990 as sia Fab Limited, a textile manufacturing company. It is primarily in the business of chemical distribution and chemical manufacturing, as well as textile manufacturing and renewable energy generation. Black Rose has its head office in Mumbai, manufacturing units in Jhagadia (Gujarat) and Kolhapur (Maharastra), warehouses in Bhiwandi (Maharashtra), Vapi (Gujarat), and Chennai (Tamil Nadu), and a liaison office in Hyderabad (ndhra Pradesh). It has two plants located at Kolhapur, Maharashtra and Bharuch, Gujarat. The company also has a fully owned subsidiary in Japan, B.R. Chemicals Co., Ltd., Japan. The promoter group holds about 75% of the total shareholding, while the rest of the shareholding lies with non-institutional shareholders. Stock Price Last Close Price 21.25 (18/01/2016) Market Cap (Cr.) 124.19 (31/12/2015) Price in Rs. 52 Wk High/Low 33.20/12.50 vg. Volume 13730.36 (1 Mo) (Rescaled to 100 for ease of comparison) Its key management includes nup Jatia as the Executive Director and Ratan Kumar grawal as the Chief Financial Officer of the company. Business Overview The company is engaged in manufacturing and trading of chemicals and manufacturing of gloves and fabrics. The company is also in the business of power generation by setting up Windmills in the State of Rajasthan and Gujarat. Black Rose s segments include chemicals, textiles, renewable energy and others. The chemical division is engaged in the import, distribution, and export of a wide range of specialty and performance chemicals. The chemical distribution business formed about 97.4% of the company s FY 2015 revenue. bout 1.2% of the revenue came from the manufacturing of fabrics and made-ups for industrial applications. The renewable energy segment supplies the State Electricity Boards of Rajasthan and Gujarat with wind-generated power, which contributed 0.8% of the total revenue. The other segment contributed 0.7% of the total revenue. Financials Revenue 87.24 80.99 122.00 115.17 195.96 Gross Margin % 5.64 15.47 13.25 1.25 12.20 Operating Income 4.16 0.16 2.74-3.07-0.96 Operating Margin % 4.77 0.20 2.24-2.67-0.49 Diluted EPS 0.71 0.05 0.42-0.58 0.10 Book Value Per Share 3.07 3.07 3.13 2.70 3.67 Operating Cash Flow 1.67 4.66 6.72-1.27 0.61 Capital Expenditure -4.68-6.83-7.10-18.50-1.50 Free Cash Flow -3.01-2.18-0.38-19.78-0.89 Profitability verage Values unless stated Return on ssets % 6.00-3.00-4.00 1.00 Return on Equity % 26.00 2.00 13.00-17.00 3.00 sset Turnover 1.78 1.41 2.15 1.56 2.16 Net Margin % 3.00-1.00-2.00 - Financial Leverage 4.93 4.62 4.17 4.80 4.76 Financial Health except Debt/Equity (Ratio) Long Term Debt 12.76 6.03 8.50 17.63 20.61 Total Equity 11.90 12.12 13.77 18.72 19.30 Debt/Equity - - - - - Working Capital 12.14-0.89-1.71-4.55-0.92 Report as of 19-Jan-2016. Initiative of the BSE Investors Protection Fund. 2016 Morningstar. ll Rights Reserved. Please refer to the disclaimers on the last page of this report.
Page 2 of 5 Income Statement Total Revenue 87.24 80.99 122.00 115.17 195.96 Cost of Revenue 82.32 68.45 105.83 113.72 172.04 Gross Profit 4.92 12.53 16.16 1.44 23.91 Operating Expense 1.53 12.62 13.72 4.69 25.19 Operating Income 4.16 0.16 2.74-3.07-0.96 Pre-tax Income 4.16 0.24 2.82-2.45-0.69 Tax Provision 1.41-0.03 1.16 0.20-1.22 Minority Interests - - - - - Balance Sheet Stock Holders Equity 11.90 12.12 13.77 18.72 19.30 Long Term Debt 12.76 6.03 8.50 17.63 20.61 Total Non-Current Liabilities 14.34 8.20 10.64 19.97 21.78 Payables 29.43 18.20 15.96 29.28 27.35 Total Liabilities 46.82 43.85 43.65 71.08 72.48 Net PPE 14.10 19.79 25.70 39.65 38.93 Goodwill and other Intangible ssets - 0.01 0.03 2.44 1.74 Total Investments - - - - - Total Non-current ssets 14.10 21.21 26.12 43.25 42.00 Trading and Other Receivables 25.99 20.45 21.36 26.31 32.04 Inventory 17.13 12.93 8.18 18.83 15.72 Cash and Cash Equivalents 1.33 1.10 1.10 0.84 0.63 Total ssets 58.72 55.97 57.42 89.80 91.77 Cash Flows Depreciation and mortization 1.12 1.13 1.16 2.16 2.78 Change in Working Capital -3.64 3.05 2.12-2.29-5.21 Operating Cash Flow 1.67 4.66 6.72-1.27 0.61 Capital Expenditure -4.68-6.83-7.10-18.50-1.50 Investing Cash Flow -4.15-6.65-6.97-10.72-1.36 Net Common Stock Issuance - - - - - Net Issuance Payments of Debt 4.38 2.69 1.21 13.77 4.89 Cash Dividends Paid - - - - - Financing Cash Flow 3.29 1.79 0.25 11.74 0.54 Changes in Cash 0.82-0.21 - -0.26-0.21 Report as of 19-Jan-2016. Initiative of the BSE Investors Protection Fund. 2016 Morningstar. ll Rights Reserved. Please refer to the disclaimers on the last page of this report.
Page 3 of 5 Financial Performance Black Rose s total revenue for FY 2015 was INR 195.96 crores, an increase of 70.15% versus a year ago. Operating margin rose by 217 basis points to -0.5% in FY 2015. Net profit for FY 2015 stood at INR 0.53 crores, an increase of 80.5% versus the last year. Revenue Growth Key Risks Risks include increase in the price of raw materials, increase in the crude oil prices, increase in the interest rate, fall in the product prices, fluctuation in currencies, slowdown in the consuming industries, change in the government policy. Macro-economic factors like deterioration in the global and domestic economic growth, sluggish demand conditions, monetary policy and fiscal policy, unforeseen political and social upheavals, natural calamities may affect the business of the company. Gross Margin Competitors Tata Chemicals Ltd and Diamines nd Chemicals Ltd (DCL) are two of the competitors of the company. Tata Chemicals Ltd is a global company with interests in businesses that focus on life: living, industry and farm essentials. It is the world s second largest producer of soda ash with manufacturing facilities in sia, Europe, frica and North merica. The company s industry essentials product range provides key ingredients to some of the world s largest manufacturers of glass, detergents and other industrial products. In FY 2015, Tata Chemicals revenue rose by 8.2% to INR 17202.9 crores versus the last year. DCL has been the pioneer and the only one in manufacturing of a range of Ethyleneamines (Es) in India. It has evolved products manufactured 'first time' in India and also pioneered to 'develop' a market for the same. Over the years, the company has established its own presence in the market and is successfully catering to the needs of Industries. In FY 2015, the company's revenue fell by 11.0% to INR 39.09 crores versus the last year. Operating Margin Report as of 19-Jan-2016. Initiative of the BSE Investors Protection Fund. 2016 Morningstar. ll Rights Reserved. Please refer to the disclaimers on the last page of this report.
Page 4 of 5 Industry Overview The chemical industry in India is a key constituent of Indian economy, accounting for about 2.11% of the GDP. In terms of volume of production, Indian chemical industry is the third largest producer in sia and sixth largest in the world. Indian chemical industry generated business worth INR 77891.15 crores in 2014. Bulk chemicals account for 39% of the Indian chemical industry, followed by agrochemicals 20.3% and specialty chemicals 19.5%. Currently, the Indian Chemical Industry is in the midst of major restructuring and consolidation phase. With the shift in emphasis on product innovation, brand building and environmental friendliness, this industry is increasingly moving towards greater customer-orientation. Even though India enjoys an abundant supply of basic raw materials, it will have to build upon technical services and marketing capabilities to face global competition and increase its share of exports. Price/Earnings Trailing Returns Quarterly Results except EPS (Rs.) 9-2014 12-2014 3-2015 6-2015 9-2015 Revenue 3.82 3.52 3.98 3.30 2.96 Other Income 0.01 0.01 0.03 0.01 - Total Income 3.83 3.54 4.01 3.31 2.96 Expenditure -3.65-3.33-3.86-3.04-2.74 Interest -0.11-0.15-0.12-0.11-0.12 PBDT 0.07 0.06 0.03 0.16 0.10 Depreciation -0.07-0.07-0.07-0.07-0.07 PBT - -0.01-0.04 0.08 0.03 Tax - - 0.12-0.02-0.01 Net Profit - -0.01 0.09 0.07 0.02 Equity 0.51 0.51 0.51 0.51 0.51 EPS - -0.02 0.17 0.13 0.04 CEPS 0.14 0.12-0.27 0.18 OPM (%) 4.88 5.89 3.74 8.15 7.40 NPM (%) 0.05-0.26 2.16 1.96 0.76 *Standalone figures Return on Invested Capital (ROIC) Report as of 19-Jan-2016. Initiative of the BSE Investors Protection Fund. 2016 Morningstar. ll Rights Reserved. Please refer to the disclaimers on the last page of this report.
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