Share Trading Tips

JK Paper (Code : 530007)  CMP Rs. – 163.00
J. K. Paper has once again come out with good set of numbers for Q1FY11. PAT zoomed up 45% to Rs 29 cr on 10% higher sales of Rs
291 cr. It posted healthy EPS of almost Rs 4 for June’10 quarter. For FY10, it had reported sales of Rs 1106 cr and net profit of Rs 91 cr i.e. EPS of Rs 12 on which it declared 20% dividend. Over the years, company has emerged as India’s largest producer of branded papers and commands 40% market share in branded cut size papers. Company boasts of having an installed paper production capacity of 2,40,000 TPA and is working at 114% capacity utilization. Even the new paper board unit recorded 118% capacity utilization for FY10. On the raw material front, company has brought over 75,000 hectares under farm forestry in state of Orrisa, Gujarat, AP, Maharashtra, Chattishgarh & WB. As of now it distributes close to 40 million seedlings annually including 5 million high yield cloned varieties developed in-house to over 40,000 farmers. For long term future growth company has decided of putting up a new pulp mill of 200,000 TPA and paper capacity of 150,000 TPA in Orissa itself involving an investment of approx Rs 1500 cr. Scrip can appreciate 25% – 30% within a year.