Quarter sales growth at 42%, quarter profit growth at 24% and a high volume breakout after long ranged movement. Buy with a stop at or below 470.
Comment:
CCL is getting support at Rs.480-Rs.496 zone, will be a good buy if crosses Rs.515. In that case initial stop loss can be placed just below the support candle low.
Trade closed: stop reached
1. CCL Products produces 250+ blends of Instant coffee for leading global coffee manufacturers in 90+ countries which constitutes the export business (~89% of sales in H1FY21). It is the world's largest private label manufacturer with capacities of 35,000 Metric tonnes in both Spray-dried (24,000 tonnes) and Freeze-dried (11,000 tonnes) capacity with plants in India, Vietnam and agglomeration capacity in Switzerland.
2. Company is expecting further growth on the B2B (manufacturing of instant coffee for private labels) side from packing & agglomeration led sales growth, and further deals with retail chains in the US and EU. On the domestic retail business side, the company is planning to reach 1 lakh distribution points covering all 10 Lakh+ population towns.
3. Constant dividend payer since 2010.
4. Last 3,5 and 10 year's average ROE above 15%.
5. Debt to equity at 0.42 (any figure below 0.5 is good) and interest coverage at 16.3 (any figure greater than 3 is good)