Supreme Industries (SIL):

© SIL, one of the largest plastic processors in the country with a well diversified product portfolio, is all geared to take advantage of encouraging prospects in fast growing plastic industry.

© Establishing mega plastic products complex (of 1.5 lakh TPA) at Gadegaon, Maharashtra, taking total capacity to 2.55 lakh TPA at cost of Rs 255 crore. Phase I has started since Feb. 2008, while total facility to be fully operational by FY 2010.

© With focus on growing value-added : high-margin products, company is going for corrugated pipes using technology from Wavin Plastics – Netherlands, setting up facility to produce protective packaging, increasing capacity of cross-linked film used to make fumigation sheets, sacks, canal covers, tarpaulins, etc., and expanding capacities in material handling systems and furniture along with introduction of new product range.

© All these initiatives, to double plastics products turnover in next 3 years with higher profit margins, as company is exiting from low-margin non-core businesses and increasing share of high-margin, value-added products addressing new markets and applications.

© Unlocking value in property at Andheri being developed as ultra-modern office complex consisting of 10 floors, company may be able to make net of tax gain of ~ Rs 290 crore (~ Rs 105/- share). Company is also in the process of unlocking value from divesting from none-core businesses and disposing off surplus assets to raise around Rs 76 crore (Rs 38 crore already realized) to part fund total capex programme of Rs 415 crore.
© SIL holds 30% stake in Supreme Petrochem (which manufactures polystyrene) is going in for massive expansion plans for value-added products. This will augur well for SIL. This investment works out to Rs 24/- per share.

For 9 months, Net sales were up by 8.8% to Rs. 868.31 crore. OPM% improved slightly to 10.6%. Further aided by 32% higher other income of Rs. 6.73 crore, PBT (before extra ordinary items) rose by 24.1% to Rs. 42.15 crore. However, extra ordinary income of just Rs. 2.16 crore (as against Rs. 10.38 crore) being profit accrued on non-refundable consideration towards sale of plot in Haryana, PAT declined marginally to Rs. 30.62 crore.