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29.03.2020

*AAKASHAYA PATRA EXCLUSIVE STOCK FOR INVESTMENT:*
SUPREME INDUSTRIES
(CMP Rs 884 )
ENTER LEVEL – 850 TO 865 STOPLOSS-600 TARGET 1600 IN 36 MONTHS

Founded in 1942, Supreme is an acknowledged leader of India's plastics industry. Handling volumes of over 3,20,000 tonnes of polymers annually effectively makes it the country's largest plastics processors.They have 25 advanced plants are powered by technology from world leaders, and complement their extensive facilities for R & D and new product development. In fact, Supreme is credited with pioneering several products in India. These include Cross- Laminated Films, HMHD Films,Multilayer Films, SWR Piping Systems and more.Supreme Industries Limited is India's leading plastic processing company with seven business divisions. The company has forayed into different types of plastic processing in Injection Moulding,Rotational Moulding (ROTO), Extrusion, Compression Moulding, Blow Moulding etc.

Supreme Industries limited offers wide range of plastic products with a variety of applications in Moulded Furniture, Storage & Material Handling Products, XF Films & Products, Performance Films, Industrial Moulded Products, Protective Packaging Products, Composite Plastic Products,Plastic Piping System & Petrochemicals.
Supreme Industries has one of the strongest balance sheets in the industry. Most of their capex is generally done via internal accruals.
Management has ramped up its capex spend to Rs 400 cr (vs Rs 350 cr earlier) for FY20 to set up Polyolefin pipe fittings plant in Odisha & Pex pipe systems at Jadcherla (expected commissioning only in FY21).
Moreover, expanded capacity of performance packaging has commenced production, also capacity to manufacture furniture at Jadcherla unit has been set up & various new products have been launched.

Other projects include: a) Kharagpur – HDPE Pipe / Injection moulded fittings capacity; b) Kanpur:PVC Pipe capacity & c) Jalgaon: Moulded fitting capacity. Expected commissioning for these projects is Q4FY20.
Management integrity is of the highest order. The stock has corrected by 35% in this recent market meltdown.

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