Re: TPL.N0000 (TALAWAKALE PLANTATIONS )

[yellow knifeTop contributor]

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[yellow knifeTop contributor]

TPL has improved in quarter ended 31st December to record 3.27 but for the 9 months EPS reports -1.86

[smallvilleTop contributor]

But TPL is all abt tea know? Pls enlighten YK - abt their portfolio.

[yellow knifeTop contributor]

Yes... small its mostly tea

[bear]

TPL should release a shocking profit recorded for the year 2016/17. With booming tea prices and good management can expect a good return on investment.

[bear]

Q 4 eps Rs12. Expect another fat dividend. Q1 minimum eps Rs4.The bullish tea prices continues.

[yellow knifeTop contributor]

2017

2017 recorded a very good year for TPL and the company was able to record the highest company profit before tax to date which was recorded in 2012.


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[yellow knifeTop contributor]

EPS recorded the second best year in 2017 for TPL

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[yellow knifeTop contributor]

Company's performance was so good and the decisions to not to pay dividend in 2016 and less dividend for 2017 made it possible to break away from the Net Asset Growth line smartly.

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There are companies that try to maintain steady dividend payout ratios like Teejay, JINS or PLC. Yet the dividend payout pattern of TPL is really good for both the company and shareholders..


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[yellow knifeTop contributor]

PE ratio was attractive when it was trading around 30s

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[yellow knifeTop contributor]

It was mentioned above that the Profit was the highest and so is the Market Value by now...It is trading at 46.50 when I am writing this.

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[yellow knifeTop contributor]

Return on Equity

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[yellow knifeTop contributor]

Company was managing its debt perfectly and now it is in a position to pay higher dividends..


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[yellow knifeTop contributor]

We are yet to see the complete picture of the Plantation sector. Even though company recorded higher profits its revenue has comedown. It was mentioned in BALA.N as well that the SL tea production was coming down during last two years.

TPL identify the same reasons like drought, strikes, and ad hoc banning of weedicides and banning certain types of fertilizer as reasons..


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[slstockVeteran]

Happy to see posts that are meant for education giving clear pictures like this.+ Reps.


Few notes

1) "We are yet to see the complete picture of the Plantation sector."

A very wise statement to be noted



2) Dividends

"decisions to not to pay dividend in 2016 and less dividend for 2017 made it possible to break away from the Net Asset Growth line smartly".

Yes specially in the volatile plantation sector, I think such moves are necessary.

"Company was managing its debt perfectly and now it is in a position to pay higher dividends."

Yeah that good to note.
In the mean time as  we know, plantations can report a fantastic one quarter and next be totally different due many volatile  factors.


3)  So smart plantations will/should manage their dividend pay out ratios to save money for difficult times and maintain their asset quality .

Else some will need to go for right issues and also face devaluation of their share prices by 50-90% in bad times.


One SAD Example :

KOTA:

It so sad to see one of the strongest ( top of the list) plantation shares in 2010-2011 period  - KOTA- being butchered by the management.

How can a once Rs 170 share trade at Rs 9 or something  in march  2017?
Also has a right issue now  at Rs 10 ( is it ? - need to check ).
They took  shareholder money time to time only to see their share value dropping 90% from top , and no dividend . Even worse is they ask for
more money from share holders after all this blunders.



Speaking of TPL ,

it is on of the better  managed plantations along with WATA and couple of others. But both/most have recovered/increased in price ( over 50%) since march bottoms reflecting their decent earnings in the last couple of quarters (after very bad period at CSE)

[කිත්සිරි ද සිල්වාTop contributor]

Glad that I decided to stick with it.
(Even WATA, I should have bought more when it was less than 20/=).

[Ethical TraderTop contributor]

Thanks YK & SLS for the comprehensive analysis. This is the type of analysis I admire. (Not the type that says "I see what you don't see because I have a ....eye and you don't see it because you are a frog in the well.")

[yellow knifeTop contributor]

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Column1	First 6 Months 2017	First 6 Months 2016
Revenue	2,073,193	1,457,751
Gross Profit	235,462	-7,329
Net Profit	132,894	-108,114

[bear]

Should report over 100 million this quarter. On the way to 400 million this year. possible dividend Rs 5

[කිත්සිරි ද සිල්වාTop contributor]

Looks like someone with the inside information !

[bear]

More than predicted. 150 million profit for the quarter. They should end the year closer to 600 million as the last quarter is the best for TPL. That is EPS of Rs 24. Should declare at least Rs 8 dividend. Is the price over or undervalued

[Fireandwater]

Cumulative for 9 months is recorded as Rs. 287Mn. The EPS is recorded at Rs.12.The share is trading at Rs.59. The dividend declared according to the published data is Rs.1.

I feel its not very undervalued for a plantation share

[Fireandwater]

Bear your Rs.8 is it a prediction or based on some numbers/Forward earnings?

[bear]

Whenever TPL made around over 200 million annual profit the dividend declared was Rs 4. This year annual profit is going to be double that. And also look at the latest balance sheet where free cash is piling up. Therefore it is a calculated prediction of a higher dividend. Rs 1 is interim and await the fat final one .

[bear]

As anticipated Rs 4 second interim dividend. More to follow with a final dividend after the final quarter.