PRINCE PIPE SHARE ANALYSIS- NEXT MULTIBAGGER

Today we are going to discuss PRINCE PIPES AND FITTINGS. According to our study, Prince Pipes can be a multi-bagger share in the future. Now we analyze the fundamentals and technicals of the share. Why this can be a potential multi-bagger? What things convince us, that this share can be a multi-bagger share?

Prince pipe is a small-cap (7830 cr) share listed in NSE and BSE. This share is in the business of household PVC pipes and fitting and another usage. The company manufactures CPVC and UPVC pipes and fittings for industrial and domestic applications. It offers piping systems and fittings in the segments such as plumbing, sewage, agriculture, and bore well. Prince Pipes and Fittings Ltd. constantly strives to pave the way for a future that provides clean water for everyone and everywhere; from the smallest villages to the largest cities.

PRINCE PIPES AT A GLANCE

PRINCE PIPES PROFIT AND LOSS

PRINCE PIPES QUARTERLY RESULT

PRINCE PIPES CASH FLOW

PRINCE PIPES PROMOTER HOLDINGS

PRINCE PIPES INSTITUTIONAL INVESTORS

Oman India Joint Investment Fund II3.83%
Mirae Asset Great Consumer Fund2.70%
Aditya Birla Sun Life Trustee Private Limited A/C Aditya Birla Sun Life Small Cap Fund1.20%
UTI – Hybrid Equity Fund1.15%
New Mark Capital India Fund I1.13%
Kuwait Investment Authority Fund 2251.65%

PRINCE PIPES MARKET SHARE OF THE BUSINESS

PRINCE PIPES REVENUE FROM PRODUCT SALES

PRINCE PIPES COMPETITOR IN THE BUSINESS

PRINCE PIPES Product range

PLUMBING

FLOWGAURD PLUS- CPVC AND COLD POTABLE WATER PLUMBING SYSTEMS

EASY FIT- UPVC plumbing systems

EASY FIT – reclaim piping systems

INDUSTRIAL

GREEN FIT- PP-R plumbing and industrial piping systems

GREEN FIT BLUE- PP-R industrial piping systems

EASYFIT IN- industrial plumbing systems (coming soon)

SWR(SEWEAGE)

SILENTFIT- low noise SWR systems

ULTRA FIT – SWR systems with world-class seals

RAINFIT- roof water systems

UNDERGROUND

FOMEFIT- underground drainage piping systems

DRAINFIT- UPVS underground drainage piping systems

CORFIT- underground double wall corrugated pipes

DURAFIT – FRP  manhole and chamber covers

AGRICULTURE AND BOREWELL

AQUAFIT- agriculture pressure pipes and fittings

SAFE FIT- borewell system

WATER STORAGE TANKS

STOREFIT- water tanks

CABLE DUCTING

CABLE FIT- cable ducting pipes

Pros

  • The company has reduced debt.
  • The company is almost debt-free.
  • The company has delivered good profit growth of 49.49% CAGR over the last 5 years
  • Stock passes the majority of CANSLIM criteria.

Cons

  • Stock is trading at 7.50 times its book value
  • MF has decreased their holding.

PRINCE PIPES COMPANY WEBSITE

Prince Pipes and Fittings Ltd. stands for innovation and setting new trends in the piping industry.

Mission
Our mission is to bring a revolution in the plastic piping industry through innovative solutions which would create a profitable growth and benefit our customers & the society at large.

Prince Pipes and Fittings Ltd. is constantly increasing its pan-India distributor base to ensure it is always close to its customers and ready to address their needs.


07- MANUFACTURING PLANTS

11- DEPOTS

1,500 +- CHANNEL PARTNERS

  • High quality plasticizing capacity, due to specially designed screw barrels, ensuring homogeneity of material.
  • Precisely controlled processing parameters ensuring consistent quality output.
  • Higher operating speeds that increase production capacity.
  • Power-saving measures.

COMPANY PRESENCE

COMPANY WEBSITE

PRINCE PIPES ANNUAL REPORT

1987- Incorporated as a private limited company and first pipe manufacturing plant set up.

2008- First to move in Northern Markets with a new plant set up at Haridwar for manufacturing pipes and pipe fittings.

2010- Nominated for the best SME Emerging India Award 2010 by ICICI Bank, CNBC TV 18 and CRISIL.

2012- Acquisition of Trubore Piping System brand and two plants in Chennai and Kolhapur.

2018- Appointed Akshay Kumar as Brand Ambassador and rolled out print and ad film campaigns across diverse mediums.

2019- New plant set up at Jaipur for pipe manufacturing The Company made its maiden public offering of equity shares on 30th Dec 2019.

CHAIRMAN’S MASSAGE

The Indian plastic pipes and fittings industry has been witnessing healthy growth over the last couple of years. The industry growth outlook remains strong driven by the Government of India’s focus on expanding areas under irrigation and increasing urban infrastructure spending which determines demand for Water Supply and Sanitation (WSS) and affordable housing projects in urban, semi urban and rural areas. Various schemes and initiatives like, Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) , Smart City projects, Housing for All by 2022 etc. will provide stronger impetus to industry growth. This in turn will be further aided by the growing penetration of branded plumbing pipes in the affordable housing project segment and need-based replacement potential of plumbing pipes. The plastic piping industry is expected to grow at a healthy pace over FY19-FY24 to reach ~INR 500 billion by FY24.

Company is one of India’s largest PVC pipes manufacturers engaged in manufacturing polymer pipes and fittings through production of polymer pipes – CPVC, UPVC, HDPE, PPR and fittings – CPVC, PPR, and UPVC. The leading brands are Prince Piping Systems and Trubore. In June 2020 your Company through a pilot launch, introduced in Gujarat a new water tank segment-STOREFIT to be later launched in other markets across India. It gives me great pride that today your Company is a front runner in leading a significant transformation in India’s exponentially increasing water demands. We have developed expansive operations across agriculture, plumbing, and borewell categories and built the widest sewage product range and underground drainage solutions. We have built a strong distribution network with over 7,167 SKUs. Driven by intense industry expertise accumulated over 3 decades.

Integrated plant at Telangana is also in the process of being established, which will reinforce the Company’s presence in South India. We will also continue to bolster our presence in Eastern India through an asset light model by outsourcing the manufacture of high-volume low value PVC pipes. Such initiatives will help us to reduce freight cost and strengthen our market share.

MANUFACTURING UNITS

With all our 6 manufacturing units strategically located, we not only ensure faster delivery across regions but also cost-efficiency as freight constitutes a significant part of our cost structure. The newest plant was commissioned in Jaipur, Rajasthan in September 2019. Designed on the green building concept, the plant covers 20 acres of the sprawling 80-acre campus and has special provisions for glare-free daylight and forced ventilation, providing comfortable working environment for our staff and associates. The current extrusion plant would majorly be manufacturing UPVC, CPVC and DWC pipes, and is well-equipped with state-of-the-art machinery, end-to-end process automation technology, 100% energy efficient utilities and the latest security & tracking systems. It has been designed for synergized man-material movement while maintaining restricted access to critical areas of material compounding. The plant’s hi-tech facilities will further strengthen the Company’s competitive advantages and help in establishing a greater foot hold in Rajasthan and Northern India. As on 31st March 2020 the Jaipur plant’s capacity stands at 20,909 tons per annum. In order to scale up our distribution and to penetrate in Southern India, we are in the process of setting up an integrated pipes and fittings manufacturing facility in Sangareddy, Telangana with a total estimated installed capacity of 51,943 tons per annum. The production is expected to commence in FY21. Additionally, the Company has also empanelled five contract manufacturers of which two are in Aurangabad (Maharashtra), one in Guntur (Andhra Pradesh), one in Balasore (Odisha) and one in Hajipur (Bihar). This asset light model, is aimed at achieving an early-mover advantage in catering to the needs of Eastern India.

Major industry growth drivers of the industry

Indian Plastic Pipe and Fittings Market

The growth in Indian plastic pipes and fittings industry is driven by investments in the agriculture and construction space, namely irrigation, water supply and sanitation (WSS), as well as in housing. Investments in these industries are closely linked to the Indian GDP growth. The size of Indian plastic pipes and fittings industry was estimated at ` 290-300 bn in FY19. The industry rose at a healthy 10%-12% CAGR between FY14 and FY19 driven by rising demand from the construction and irrigation sectors. This was further aided by increased awareness, adoption and substitution of metal pipes by plastic pipes due to their lower price, higher longevity, relative resistance to leakage, and easy installation. The organised segment in the pipes and fittings industry accounts for a 60-65% share of the country’s plastic pipes industry.

Includes the following:

  • I Government’s focus on irrigation (increasing area under irrigation), WSS projects (focus on urban infrastructure) and real estate
  • sector (Housing for All by 2022).
  • I An expected increase in India’s per capita plastic consumption (from the current 11kg as compared to global average of 30kg).
  • I Substitution and Replacement demand: an increase in the application of CPVC (which are expensive and placed high on
  • qualitative parameters vs. UPVC pipes).
  • I Consolidation in the plastic pipes industry to help organised pan India players.

READ FULL ANNUAL REPORT