🔍 At a glance
Manaksia Coated Metals & Industries Ltd (MANAKCOAT) has quietly outperformed, with a whopping 97% stock CAGR over 5 years — all while producing mosquito coils and pre-painted coils. But is this coated play now overheated, with a P/E of 69 and falling promoter holding? Here’s the full 5-year story decoded — sales, margins, debt cuts, and some blue-colored red flags.
🏭 About the Company
- Incorporated: 2010
- Group: Manaksia Group
- Headquarters: Kolkata
- Products: Pre-painted metal coils, galvanized steel sheets, mosquito repellent coils
- Special Tie-Up: Contract manufacturing for Reckitt Benckiser – Ultramarine Blue Powder
In short, they’re your neighborhood industrial paint-meets-healthcare supplier — and they found their mojo during India’s post-COVID metal rally.
🧑💼 Key Managerial Personnel (KMP)
- Chairman: Mr. Basant Kumar Baheti
- Managing Director: Mr. Arvind Kumar Jalan
- Independent Directors: Present
- CFO & CS: Regularly updated, as per SEBI filings
- No reported resignations, but promoter holding fell from 69.19% to 58.98% in just 12 months. Hmm.
📊 Financials (FY21–FY25)
💸 Income Statement Summary (Standalone)
| Year | Revenue (₹ Cr) | EBITDA (₹ Cr) | EBITDA Margin | PAT (₹ Cr) | EPS (₹) |
|---|---|---|---|---|---|
| FY21 | 446 | 33 | 7.4% | 6 | 0.98 |
| FY22 | 648 | 35 | 5.4% | 9 | 1.37 |
| FY23 | 652 | 33 | 5.0% | 5 | 0.77 |
| FY24 | 740 | 51 | 6.9% | 12 | 1.57 |
| FY25 | 782 | 54 | 6.9% | 16 | 1.97 |
🧠 Observation: While sales grew just 6% CAGR in 3 years, net profit jumped 3x. EPS doubled. Looks like margin discipline paid off.
🧮 Forward Fair Value (FV) Estimate (Edu Model)
Assumptions:
- Expected FY26 EPS = ₹2.4
- Fair P/E Range = 20–25x (smallcap metal player, average peers ~23x)
➡️ Forward FV = ₹48 – ₹60
📉 Current Price = ₹128
🤯 So it’s trading at >2x forward FV, meaning market already pricing in a lot of optimism. Or a pending ultramarine blue boom? 😅
📈 5-Year Stock Chart Performance
| Timeframe | CAGR |
|---|---|
| 1-Year | 76% 🚀 |
| 3-Year | 79% 💥 |
| 5-Year | 97% 🔥 |
This thing was a stealth multibagger. Until now. And now it’s suddenly become a crowd favorite — just as promoters are exiting. Suspicious?
🏗️ Business Model Highlights
- Pre-Painted Coils: Used in roofing, appliances, and auto — highly cyclical demand.
- Contract Manufacturing: For Reckitt Benckiser — gives stable B2B revenue.
- Zero moat, high commodity linkage: Pricing is driven by global zinc/steel trends.
- High Working Capital: Inventory days are 171 days! That’s more than a half-year of stock lying around.
🧾 Balance Sheet Check
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Debt (₹ Cr) | 143 | 173 | 190 | 178 | 142 ✅ |
| Cash (Net) | 2 | 2 | -4 | -0 | -0 |
| ROCE (%) | 12% | 13% | 10% | 15% | 15% |
| ROE (%) | 7% | 7% | 6% | 8% | 8% |
| Inventory Days | 163 | 151 | 180 | 143 | 171 🔺 |
👀 Inventory & working capital cycles still remain bloated — which eats into free cash flow.
📉 Red Flags
- ❌ P/E of 69: For a metal company with 8% ROE, this is… ambitious.
- ❌ Promoter Dumping: 10.2% drop in promoter stake in 1 year.
- ❌ Low Interest Coverage: High borrowings still persist; interest cost = ₹33 Cr in FY25.
- ❌ High Working Capital: Cash conversion cycle = 52 days and rising.
- ❌ Dividend Yield = 0.04% → basically nada for income investors.
🔍 Why it stood out
✅ Turned around from low EPS & losses in 2015–16 to consistent profitability.
✅ Margins improved by 200 bps since FY23 despite global volatility.
✅ Reduced debt by ₹36 Cr in FY25 — good sign.
✅ 5-year price up nearly 5x without media coverage or pump-n-dump antics.
But now the valuations are pricing it like a tech stock, not a tin sheet business.
🧠 EduInvesting Take
“From mosquito coils to steel sheets — Manaksia’s portfolio sounds like a dystopian hardware store. But investors didn’t care. They saw 97% CAGR and jumped in. Unfortunately, the party might already be over. When promoter exits meet a P/E of 69, we call that… ‘Ultramarine Bubble Blue’.”
⚠️ Risks & Red Flags
- Global commodity correction = margin erosion
- Zinc/steel price volatility directly affects topline
- Debt still at ₹142 Cr with interest coverage <2
- Promoters may continue exiting
- Reckitt tie-up, while stable, isn’t high-margin
🔚 TL;DR
- Stock up 97% CAGR in 5 years — now at ₹128
- EPS grown from ₹0.98 to ₹1.97, but valuation overheating
- Debt reduced, margins stable, but promoter exit a serious red flag
- Fair Value = ₹48–₹60 → current price suggests “all future good news baked in”
- Expect sideways consolidation unless another trigger (acquisition, split, delisting) emerges
Author: Prashant Marathe
Date: 12 June 2025
Tags: Manaksia Coated, Ultramarine, Metal Stocks, Smallcap Rally, 5-Year Recap, Promoter Exit, Commodity Stocks, EduInvesting
