Balkrishna Industries
Balkrishan
Industries Share Rs.400 to Rs.1200 in just 1.5 years. Here are the
reasons why the share became multiple three times in just 1.5 years
Product
: The Balkrishna Industries is engaged in the business of
manufacturing and selling of Off-Highway Tyres (OHT) in the specialist
segments such as Agricultural, Industrial & Construction,
Earthmovers & Port, Mining, Forestry, Lawn & Garden and All
Terrain Vehicles (ATV) . The company has captured the tyre market of
heavy vehicles agriculture, industrial customers. The product is good.
If any share has to grow it should have a good product.
Future
Demand and Stability of product : The demand of the product will remain
in future as the tyres will remain in demand for the agricultural,
industrial other heavy vehicles.
Expansion
: The Expansion of the demand of such type of tyres are limited because
limited number of heavy vehicles are in the market. However, the
company was trying to capture the whole market in its segment in the
year 2016.
Cash
: We have told in other case studies also that Cash is King for the
expansion of any business. The company had enough cash from 2014 to
2016 and was in the mode of expansion. However, the share of the
company moved rapidly only after 2016 because every company wants to
expand it business and invest money but whether it would be successful
or not it is decided by the time in the future.
The
company started its expansion in the 2014 and till 2016 the expansion
plan of the company became successful. We can know the fact from the
analysis of Balancesheet of the company.
We
can see above in the balancesheet above, the reserves of the company
grew from 2272 crores to 2775 crores in March 2016 , means a rise of
about 500 crores. Plus the company also reduced its Secured Loan from
1604 crores to 1114 crores and also reduced the unsecured loan from 388
crores to 174 crores. Here the company got the boost. In the year 2014
to 2016 the company expanded its business but the success was seen in
2016 which made the share rise from Rs.400 to 1200 in just 1 . 5 years.
BUT WAIT ! Analysis is not complete yet?
If you are happy with the above returns then see below why the above investment was not good.
Srichakra
Industries is also in the manufacturing of tyres but its in the segment
of two wheeler and three wheeler vehicles. While the Balkrishna
Industries is in the manufacturing of tyres for heavy machinery
vehicles. There is a big difference in the demand of the products of
the two companies. The demand of two wheelers and three wheelers tyres
is more frequent and more in demand because of more use in comparison
with heavy machinery vehicle tyres.
TVS
Srichakra share rose from 400 to 3000 in just one year i.e. 7 times
return in one year only. The Balkrishna Industries share gave only 3
times returns. That is the reason , that the investment in Balkrishna
Industries was not good in comparison with TVS Srichakra Industries.
The
above types of Fundamental Analaysis alongwith Technical Analysis of
Chart , we teach in our “Black Box ” Training Course. After learning
the “Black Box” Training programme, trader / investor can earn huge
money on their investments. Our Black Box training programme is unique
and simple. Besides, the technical trading setup gives you better
analysis to enter and exit in a share at right time. This gives you
power to grow your money rapidly and without any fear in the stock
market. You must note that in all our case studies our focus is on the
business of the company and thereafter on the shares.
We
are also giving below the Balancesheet of the TVS Srichakra Industries
so that you can analysis the same yourself and if you have questions ,
you may write to us in the comment section below.
