Chinese have already starting dumping Balaji's products

http://www.livemint.com/2010/12/13185348/Govt-starts-chemical-dumping-p.html

Govt starts chemical dumping probe from China, EU, US

New Delhi: The Government has initiated a probe into alleged dumping of morpholine - a chemical used in crop protection and rubber industry - by exporters from the EU, US and China in the Indian markets.

The Directorate General of Anti-Dumping and Allied Duties in the Ministry of Commerce and Industries started the investigations on a complaint by Maharashtra-based Balaji Amines Ltd last week.

The DGAD said it has “sufficient evidence” of dumping of the chemical from the EU, US and China.

“The Authority (DGAD) hereby initiates an investigation into the alleged dumping, and consequent injury to the domestic industry...,” it said.

Morpholine is an extremely versatile chemical and is used by rubber industry and drugs industries. It is also used in crop protection agents, dyes and optical brighteners. Besides, it is also an important chemical for the toiletry and cosmetic products manufactures.

The probe would look into the imports between July 2009 and June 2010.

On the recommendation of the DGAD, the Revenue Department imposes anti-dumping duty.

India has slapped the restrictive duty on several items such as yarn, fabrics, certain stainless steel products, auto parts and chemicals imported from various countries.

A country initiates anti-dumping probe to see whether its domestic industry has been hurt due to a surge in below-cost imports. As a counter-measure, it imposes duties under the multilateral regime of the WTO.

Such duties ensure fair trading practices and create level-playing field for domestic producers vis-a-vis foreign players resorting to dumping.

Originally posted by CHINKI Thanks Excelji for the info and link. They have sold hardly 990MT compared to 683MT of last year till September. They have a capacity of 3000MTPA and the quantity clearly shows that they are unable to use the full capacity.

That is a 50 per cent increase in sales. Excess capacity means there won't be capex for the next couple of years on this product. However pricing pressure is cause for concern.

Balaji amines has reported around 50% jump in net profits for 9m fy 11. 9M eps is around 7.7. Full year EPS for fy 11 could be around 10.

Looking at the charts on a monthly basis, the stock seems to be taking support at the lower end of an upward sloping channel. The stock had earlier formed a bottom of 35.5 in dec 2010 and has recently posted a bottom of 36.05 in Feb 2011. If it holds and stock moves above around 45-46 then there will be a confirmation of a double bottom with targets in excess of 60. Crucial support to be watched should be 35-36. cmp around 36.80



Edited by hit2710 - 10/Feb/2011 at 4:42pm

Originally posted by hit2710 Looking at the charts on a monthly basis, the stock seems to be taking support at the lower end of an upward sloping channel. The stock had earlier formed a bottom of 35.5 in dec 2010 and has recently posted a bottom of 36.05 in Feb 2011. If it holds and stock moves above around 45-46 then there will be a confirmation of a double bottom with targets in excess of 60. Crucial support to be watched should be 35-36. cmp around 36.80

Balaji Amines gave a good move on Friday and closed around 45, having posted a high of around 48.90. It seems the double bottom is now firmly in place and Balaji now becomes a good stock to buy on declines. 200 dema is placed around 39.65.

This looks like a good combination of fundamentals with strength shown on charts also.