Ashish Kacholia is Super Bullish on this Packaging Company; Increases Stake for Fifth Straight Quarter

It's said that the rich get richer. The top investing gurus are part of this privileged group as they have earned big bucks with their bold stock picks over the years.

That is why, it always pays to follow their strategies. Indian investors are all ears when there's a buying or selling activity by big names in the stock market.

One such investor which is widely tracked in Indian markets is Ashish Kacholia. The latest shareholding pattern of a company revealed that Kacholia increased stake in the quarter gone by.

Who is Ashish Kacholia?

When we talk about successful investors in India, it's impossible not to mention Ashish Kacholia.

Kacholia is known for identifying the best multibagger stocks. He is known as the 'Big Whale' of the Indian stock market.

Over the years, he has picked the best multibagger stocks by looking at the fastest-growing companies from the midcap and smallcap space.

He started his career with Prime Securities in 1993. In 2003, he started Hungama Digital Entertainment Company along with Rakesh Jhunjhunwala. He is also the proprietor of Lucky Securities.

Which stock did Kacholia buy recently and why?

The company is from the packaging space - Xpro India.

Shareholding pattern of Xpro India shows that Kacholia increased his stake by 0.05% in the October-December 2022 quarter.

In the September 2022 quarter, Kacholia had 4.40% stake or 779,350 shares of the company. So now Ashish Kacholia portfolio has 4.45% stake or 788,550 shares of Xpro India. As of Friday's close, his stake was valued at around Rs 520 million (m).

He has remained bullish on Xpro India for a long time now. Here's how Kacholia's holding in the company has varied since he initially bought into the company.

Ashish Kacholia's stake in Xpro India

Quarter ending	Percentage (%)
Sep-21	2.5%
Dec-21	2.9%
Mar-22	3.6%
Jun-22	3.9%
Sep-22	4.4%
Dec-22	4.5%

Data Source: BSE

While we can't know for sure why the star investor bought into it, there are some reasons that we can guess...

The first reason is the improvement in the company's financials. For the year ended March 2022, the company reported more than fivefold increase in its net profit.

The company has significantly reduced debt over the past five years. The debt-to-equity ratio that stood at a substantial 1.7x in 2018 has shrunk to 0.5x in 2022.

The dramatic decrease in interest payment has boosted the profitability of the company.

Even on trailing twelve-month (TTM) basis, the quarterly results of Xpro India paint a good picture. Take a look at the table below.

Quarterly Performance

Rs m, consolidated	Sep-22	Sep-21	Change (%)	Jun-22	Jun-21	Change (%)
Net Sales	1,340.0	1,265.5	6%	1,596.3	911.2	75%
Operating Profit	201.3	176.4	14%	236.9	114.9	106%
Net Profit	160.9	108.4	48%	185.3	50.2	269%

Data Source: Ace Equity

The second reason could be the company's presence in niche industries. This allows it to have a dominant market share.

Xpro India is a strong player in the polymer processing industry. There is no competitor as the business is capital-intensive.

It operates in three divisions Biax, Coex, and Thermoset.

The company is the leading manufacturer in India of coextruded plastic sheets, thermoformed liners, and speciality films.

The company is the only manufacturer of dielectric films in India (Biax division) and has a market share of about 33% in the domestic market besides exports.

The company is also one of the leading players in the coextruded cast films and sheets (Coex division).

How Xpro India has performed recently

Xpro India share price opened the day on a flat note at Rs 659 on the BSE against its previous close of Rs 658.

As the session progressed, shares of the company went on to gain 2% and touched a high of Rs 681.

Xpro India has a 52-week high of Rs 1,116.6 touched on 25 March 2022 and a 52-week low of Rs 590.6 touched on 26 December 2022.

In the past one year, the stock has underperformed by falling 12%.

Here's a table comparing Xpro India with its peers.

Comparative Analysis

Company	Xpro India	Texmo Pipes	Wim Plast	Nilkamal	EPL
ROE (%)	40.0	8.3	8.7	6.6	13.1
ROCE (%)	22.2	14.3	11.8	10.5	14.2
Latest EPS (Rs)	35.9	2.1	34.1	71.0	5.8
TTM PE (x)	18.3	27.9	14.0	27.0	28.7
TTM Price to book (x)	5.7	0.9	1.4	2.3	2.9
Dividend yield (%)	0.3	0.0	1.7	0.8	2.6
Industry PE (x)	22.8
Industry PB (x)	3.4

Data Source: Ace Equity

About Xpro India

Xpro India is a Birla group company, one of the country's largest industrial house with a global presence in manufacturing and trading activities.

Incorporated in 1997, it is engaged in the polymers processing business primarily in India.

The company has four manufacturing units located in West Bengal, Uttar Pradesh, and Maharashtra.

To know more about the company, you can check out Xpro India's company fact sheet and Xpro News and Analysis here.

You can also compare Xpro India with its peers.

Xpro India vs AMD Industries

Xpro India vs Duropack

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...