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Shares of Kaveri Seed hit an all-time high of Rs 978.95 on the BSE on Monday. Improved demand for BT cotton, strong financial performance in the last quarter, and the pick up in monsoon have revived interest in the stock.
The stock closed at Rs 973.25, a gain of 2.8 per cent over the previous close. The stock gave over 100 per cent return in 2012 so far.
The company’s net profit in the June quarter more than doubled to Rs 101 crore (Rs 47 crore), while income doubled to Rs 479 crore (Rs 241 crore).
Earnings per share jumped to Rs 73.8 in the June quarter against Rs 42.4 for last fiscal.
The income derived from sale of seed business is exempt from income-tax, while the micro-nutrient division is subject to normal tax rates. This has enhanced the profitability of the company.
Kailash Gandhi, Research Analyst, Walfort Financial Services, said the seed industry is poised for good growth and Kaveri Seed is well positioned to take full advantage of this.
The company has a well-diversified product portfolio, a strong research and development team and pan-India presence to reap the benefit of growing demand for hybrid seeds, he said.
Kaveri’s seed portfolio includes maize, cotton, sunflower, pearl millet, sorghum and rice, while under vegetables it has tomatoes, okra, chillies and watermelon.
The company’s premier BT cotton hybrids launched a couple of years ago are market leaders. The hybrid seeds for red gram and paddy have also created niche for themselves.
>suresh.iyengar@thehindu.co.in
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