GUJARAT AMBUJA EXPORTS SHARE: Annual Report Summary

GUJARAT AMBUJA EXPORTS SHARE INFORMATION 

  • Gujarat Ambuja Exports Limited (Company) is a Public Limited Company situated in India.
  • Gujarat Ambuja Exports share is mainly an Agro Processing conglomerate with various manufacturing plants at different places in States of Gujarat, Maharashtra, Madhya Pradesh, Uttarakhand and Karnataka. 
  • Product profile of the company includes all types of Oil Seed Processing, Edible Oil Refining, Cotton Yarn Spinning, Maize based Starch and its derivatives, Wheat Processing / Cattle Feed and Power Generation through Wind Mills, Bio gas, Thermal Power & Solar Plant mainly for internal consumption.  
  • Gujarat Ambuja Exports share are listed on BSE and NSE. 

PERFORMANCE OBLIGATION 

Information about the Company’s performance obligations are summarised below: 

  • Cotton, Maize and Agro 

The performance obligation is satisfied upon delivery of the goods and payment which is generally due within 0 to 180 days from delivery, usually backed up by financials arrangements. 

  •  Power generated from Windmills  

The performance obligation from windmills is recognised on unit generation basis, in accordance with the terms of power purchase agreements. 

MAIZE PROCESSING SEGMENT 

The Maize Processing Segment showed a marginal decrease of 0.65% in total sales. However, the share in company’s top line has reduced significantly from 51.64% to 41.61%. This was mainly on account of pointed demand in domestic market and increase in top line by Agro Processing Segment. Though there is a marginal reduction in topline, cash profit margins were increased manifold and reached to 22% of topline as against 12% of top line during previous year.

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AGRO PROCESSING SEGMENT 

The Agro Processing Segment showed a substantial growth of 55% in total sales. Further, the share in company’s top line has increased significantly from 43.67% to 54.79%. And it is mainly due to the demand of agro products in international market during latter half of the year outperforming the Maize Processing Segment. Apart from increase in top line of the segment, cash profit margins were increased and reached to 7% of topline as against 4% of top line during previous year. The segment has twin manufacturing activities. For refining of edible oil, the mainstream activity is oil seed crushing and downstream activities. 

POWER SEGMENT AND CONTRIBUTION TO RENEWABLE ENERGY 

The power generation at each location of the Company continued to support each segment to maintain its productivity, although the revenue generation showed a decline of 24.51%. Captive power plant is present at all the manufacturing units. These infrastructures support the segment to be consistent performer. 

FINANCIAL PERFORMANCE AND OVERALL ANALYSIS 

FINANCIAL KEY METRICS VALUE 
MARKET CAPITALIZATION ₹ 6,134 Cr 
STOCK P/E 12.9 
INDUSTRY P/E 34.3 
ROE  25.1 % 
ROCE 30.5 % 
DEBT TO EQUITY RATIO 0.13 

The market capitalization of Gujarat Ambuja Exports is Rs 6,134 Cr which is a mid-cap company and has good competition in its respective sector. 

In Edible Oil sector, Gujarat Ambuja Exports stands 3rd in this segment. 

Currently the stock P/E is 12.9 which is lower than the industry P/E of 34.3.  

The return on equity is 25.1 % which is quite favorable as it directly indicates that the investors are getting more than bank FD returns on their equity in this stock. 

The return on capital employed is 30.5 % and shows a superb operating income is generated for every rupee of capital invested. 

Gujarat Ambuja Exports share currently has 0.13 which is less and the company is focusing on reducing it further. 

The Company achieved EBIDTA margin of 11.93% in F.Y. 2020-2021 against 7.63% in F.Y. 2019-2020.  

The Company achieved Earnings before Interest, Depreciation and Tax (EBIDTA) of Rs 561.49 crores for the F.Y. 2020-2021 against that of Rs 291.23 crores for the F.Y. 2019-2020.  

MANUFACTURING SEGMENTS 

This Company has mainly three manufacturing segments, the products of which are having application for end use in multiple industries like food, pharma and paper. 

COMPANY PRODUCTS 

Gujarat Ambuja Exports share products

GLIMPSE OF MANUFACTURING PLANTS IN INDIA 

CAPITAL PROJECTS IN FY 2020-21 

During the year, Gujarat Ambuja Exports share has invested about Rs 50.24 crores in the ongoing projects mainly into routine capital expenditures in modifications of existing projects.  

This investment was for its maize processing units at all locations and agro processing segments.  

Apart from usual capital expenditures on the ongoing projects, the Gujarat Ambuja Exports share has invested Rs 94.13 crores in the new projects which also includes Rs 34.52 crores towards green field project of 1000 TPD at Malda in West Bengal.  

The fulfillment work on the green field project of 1000 TPD Maize processing facility at Malda in West Bengal is progressing well. 

OVERVIEW OF GLOBAL BUSINESS ENVIORNMENT 

Improved outlook:  

After an estimated contraction of –3.3 percent in 2020, the global economy was projected to increase at 6 percent in the year 2021, and moderating to 4.4 percent in the year 2022.  

The projections for 2022 are stronger than anticipated, reflecting additional fiscal support in a few large economies. 

Greatly appreciated to unprecedented policy response, the COVID-19 recession is likely to leave smaller scars than the 2008 global financial crisis.  

However, emerging market economies and low-income developing countries have been hit harder and are expected to suffer more significant medium-term losses. 

Divergent impacts:  

Output losses have been especially large for countries that depends on tourism and commodity exports and for those with limited policy space to respond.  

Many of these countries entered the crisis in an uncertain fiscal situation and with also less capacity to mount major health care policy responses or support livelihoods.  

The projected recovery develops a severe contraction that has had particularly adverse employment and earnings impacts on certain groups.  

 With relatively lower educational attainment the youth, women labourers, and the informally employed have generally been hit hardest.  

Income inequality is likely to increase significantly because of the pandemic.  

95 million people are below the threshold of extreme poverty in 2020 which is an estimated value.  

Also, unfairly setbacks to schooling could further amplify income inequality. 

FUTURE OUTLOOK 

Agriculture sector will see a boost due to a forecasted normal monsoon and bumper harvest of summer crops. 

The Government’s push to the manufacturing sector through the production-linked incentive scheme will expand domestic production and help integrate domestic manufacturing with global supply chain. 

Gujarat Ambuja Exports share is a primary supplier to food, feed and nutritional ingredients industry, the demand is estimated to get its normal levels sooner than Industry in general and hence, and the company expect a good satisfactory business performance in next FY. 

OPPORTUNITIES 

1. Higher earning segments have the potential of getting their capacity expanded. 

2. Expertise in new products development. 

3. Good geographical reach and continued efforts to expand it. 

4. Enhanced acceptability of new value-added products. 

5. Have positioned to expand on their own, lower dependency of others. 

RISKS, THREATS AND CONCERNS  

1. Internal factors and government policies. 

2. Vague thinking of major strong nations. This has maximum impact on emerging market. 

3. And unpredictability on monsoon and threat of global warming on it.  

4. Potential to increase global trade war. 

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