Midcapmania Multibaggers - March 9 2008

K S Oils (KSO), established in 1985, is a leading name in the edible oil industry.The company has been promoted by the Garg family of Morena, Madhya Pradesh. The Garg family has been dealing in agro-based products since the past 150 years. KSO currently figures among the top-five edible oil companies in India. KSO brands are actively traded in the leading commodity markets and are often looked upon as trend setters in the largely unorganised edible oil segment.KSO has won prestigious awards like "Highest Processor of Rapeseed Oilcake" for 2004-05 and 2005-06 from The Solvent Extractors Association of India. KSO was also awarded the "Emerging Company of the year" in September 2006 by Globoil India.

The company is a manufacturer of mustard and rapeseed oil in India. The company is engaged in the manufacturing of cooking media such as mustard oil, refined oil, vanaspati and non-edible solvent oil and DOC. Double Sher and Kalash (mustard oil) are the company`s flagship brands. Some of its other brands include KS Refined Oil, Crystal Clear (soya vegetable refined oil), KS Gold (vanaspati ghee) and KS Gold Plus (vanaspati ghee). The company has a strong presence in parts of eastern and north-eastern India.

KSO being the largest rapeseed crusher in India enjoys market leadership in the mustard oil segment. The company also enjoys lower manufacturing costs resulting from economies of scale and integrated production, secure raw material supply, extensive distribution network through central distribution points and the company's extraction efficiency of 33% which is more than the other crushers.







KS Oils registered a 60.47% growth in net profit to Rs 324.30 million for the quarter ended December 2007 as compared with Rs 202.10 million for the corresponding quarter, last year. Net sales for the quarter rose 84.72% to Rs 5,636.70 million as against Rs 3,051.50 million for the same quarter, a year ago. Total income for the quarter rose 85.28% to Rs 5,653.90 million as compared with Rs 3,051.50 million for the corresponding quarter, last year. The diluted earnings per share (EPS) of the company stood at Rs 1.05 in the quarter ended December 2007.
Promoters are utilizing this fall to increase their stake. Ramesh Chand Garg(Promoter) increased its stake in the company to 10.77% from 5.19%.

Further FII's have increased their stake in the company for the quater ended December 2007.

We have a buy rating on K S oils Ltd (C.M.P 74.55). Targets - 140+ in 9-12 months and 200+ in 18 months.



Disclaimer: DP does NOT vouch for these recomendations. These are by a independent analyst who may have vested interest in the stock