BSE:500339

Stock Analysis Report

Executive Summary

Rain Industries Limited, together with its subsidiaries, manufactures and sells carbon products, cement, electricity, and specialty chemicals worldwide.

Rewards

Trading at 56% below its fair value

Risk Analysis

Interest payments are not well covered by earnings

Unstable dividend track record

Profit margins (1.1%) are lower than last year (7.5%)



Snowflake Analysis

Fair value with mediocre balance sheet.

Share Price & News

How has Rain Industries's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 500339 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-8.3%

500339

-0.5%

IN Chemicals

-0.8%

IN Market


1 Year Return

13.1%

500339

27.2%

IN Chemicals

11.1%

IN Market

Return vs Industry: 500339 underperformed the Indian Chemicals industry which returned 27.2% over the past year.

Return vs Market: 500339 exceeded the Indian Market which returned 11.1% over the past year.


Shareholder returns

500339IndustryMarket
7 Day-8.3%-0.5%-0.8%
30 Day-16.8%2.3%-2.3%
90 Day1.3%11.3%2.1%
1 Year14.2%13.1%30.1%27.2%13.1%11.1%
3 Year26.3%23.0%55.1%48.9%22.9%16.2%
5 Year198.9%177.5%118.9%103.3%34.9%22.6%

Price Volatility Vs. Market

How volatile is Rain Industries's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Rain Industries undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 500339 (₹103.65) is trading below our estimate of fair value (₹235.61)

Significantly Below Fair Value: 500339 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 500339 is poor value based on its PE Ratio (25.4x) compared to the Chemicals industry average (11.1x).

PE vs Market: 500339 is poor value based on its PE Ratio (25.4x) compared to the Indian market (13.3x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 500339's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 500339 is good value based on its PB Ratio (0.7x) compared to the IN Chemicals industry average (1.1x).


Next Steps

Future Growth

How is Rain Industries forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

16.4%

Forecasted Materials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Rain Industries has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Rain Industries performed over the past 5 years?

25.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 500339 has high quality earnings.

Growing Profit Margin: 500339's current net profit margins (1.1%) are lower than last year (7.5%).


Past Earnings Growth Analysis

Earnings Trend: 500339's earnings have grown significantly by 25.3% per year over the past 5 years.

Accelerating Growth: 500339's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 500339 had negative earnings growth (-86.6%) over the past year, making it difficult to compare to the Chemicals industry average (11.6%).


Return on Equity

High ROE: 500339's Return on Equity (4.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Rain Industries's financial position?


Financial Position Analysis

Short Term Liabilities: 500339's short term assets (₹46.4B) exceed its short term liabilities (₹20.7B).

Long Term Liabilities: 500339's short term assets (₹46.4B) do not cover its long term liabilities (₹82.9B).


Debt to Equity History and Analysis

Debt Level: 500339's debt to equity ratio (147.2%) is considered high.

Reducing Debt: 500339's debt to equity ratio has reduced from 238.6% to 147.2% over the past 5 years.

Debt Coverage: 500339's debt is well covered by operating cash flow (23.2%).

Interest Coverage: 500339's interest payments on its debt are not well covered by EBIT (1.6x coverage).


Balance Sheet

Inventory Level: 500339 has a high level of physical assets or inventory.

Debt Coverage by Assets: 500339's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Rain Industries's current dividend yield, its reliability and sustainability?

0.96%

Current Dividend Yield


Dividend Yield vs Market

company1.0%marketbottom25%0.6%markettop25%2.5%industryaverage0.8%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: 500339's dividend (0.96%) is higher than the bottom 25% of dividend payers in the Indian market (0.6%).

High Dividend: 500339's dividend (0.96%) is low compared to the top 25% of dividend payers in the Indian market (2.55%).


Stability and Growth of Payments

Stable Dividend: 500339's dividend payments have been volatile in the past 10 years.

Growing Dividend: 500339's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (24.5%), 500339's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average board tenure


CEO

N. Reddy (77yo)

0.9yrs

Tenure

₹400,000

Compensation

Mr. N. Radhakrishna Reddy serves as the Managing Director of Rain Industries Limited since March 31, 2019. Mr. Reddy has more than 44 years of experience in Construction and Cement Industry. He served as t ...


Board Members

NamePositionTenureCompensationOwnership
N. Reddy
MD & Director0.9yrs₹400.00k3.09% 1.1b
Hira Zutshi
Independent Chairman0.9yrs₹1.66mno data
Jagan Reddy Nellore
Vice Chairman0.9yrs₹16.84m0.000030% 10.5k
Radhika Haribhakti
Independent Director5.3yrs₹1.66mno data
Sujith Reddy Nellore
Non-Executive Director27.9yrsno data2.98% 1.0b
Varun Batra
Independent Director2yrs₹1.24mno data
Nirmala Reddy
Independent Director3.4yrs₹1.72mno data
Brian McNamara
Independent Director1yrsno datano data

2.7yrs

Average Tenure

59.5yo

Average Age

Experienced Board: 500339's board of directors are not considered experienced ( 2.7 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Rain Industries Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Rain Industries Limited
  • Ticker: 500339
  • Exchange: BSE
  • Founded: 1974
  • Industry: Commodity Chemicals
  • Sector: Materials
  • Market Cap: ₹34.845b
  • Shares outstanding: 336.35m
  • Website: https://www.rain-industries.com

Number of Employees


Location

  • Rain Industries Limited
  • Rain Center
  • 34, Srinagar Colony
  • Hyderabad
  • Andhra Pradesh
  • 500073
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
500339BSE (Mumbai Stock Exchange)YesEquity SharesININRJul 1994
RAINNSEI (National Stock Exchange of India)YesEquity SharesININRJul 1994

Biography

Rain Industries Limited, together with its subsidiaries, manufactures and sells carbon products, cement, electricity, and specialty chemicals worldwide. The company operates through three segments: Carbon, Advanced Materials, and Cement. It offers calcined petroleum coke, coal tar pitch, and green petroleum coke, as well as other derivatives of coal tar distillation, including carbon black oil, creosote oil, naphthalene, and other aromatic oils; naphthalene derivatives, including naphthalene, phthalic anhydride, polynaphthalene sulfonates, and modifiers; petrochemical intermediates, such as benzene, toluene, xylene, solvents, and fuel additives; carbon resins, hydrocarbon resins, pure resins, hydrogenated resins, and phenolics; and engineered products comprising binders and sealer coatings, as well as superplasticizers. The company also engages in the co-generation of energy through waste heat recovered in the calcining process. In addition, it produces and sells ordinary Portland and Portland pozzolana cement under the Priya Cement brand name. The company was formerly known as Rain Commodities Limited and changed its name to Rain Industries Limited in July 2013. Rain Industries Limited was incorporated in 1974 and is headquartered in Hyderabad, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 12:44
End of Day Share Price2020/02/18 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.