Confidence Petroleum

[rmani84]

CMP : 18


Confidence Petroleum India Ltd. bottles liquid petroleum gas (LPG) and manufactures LPG bottles.

Confidence Petroleum has been impressive with its Revenues and PAT growth. It has grown 700 times in revenues and 100 times in PAT in the last 5 years. Now, this does not guarantee its future performance. But, it has been doing good every quarter over quarter. NPM has dipped in this aggressive growth in the last 5 years which is understandable and is currently at 7%. They should be able to pick this up at a later stage when their revenues starts saturating. Its currently trading at a P/E of 15 which is fair and makes it a very attractive growth stock. Buy, accumulate on dips and hold.

[rmani84]

Confidence Petroleum has reported a sales turnover of Rs 188.60 crore and a net profit of Rs 12.36 crore for the quarter ended Dec '10

[Abhijit]

Hello Mani,

I am holding Confidence Petroleum from last year @7.70 I was holding this stock and didn't booked profit when the price of the share was 27 and now the share is falling day by day inspite of posting such good results and having good fundamentals. Is there any specific reason behind this? Please suggest what should I do now.

[rmani84]

Hello Mani,

I am holding Confidence Petroleum from last year @7.70 I was holding this stock and didn't booked profit when the price of the share was 27 and now the share is falling day by day inspite of posting such good results and having good fundamentals. Is there any specific reason behind this? Please suggest what should I do now.

Its a small-cap stock and sadly small-cap stocks take the blunt of market falls. Its a fundamentally good stock posting growing profits every quarter. Hold for long term.

In future, book profits completely in small-cap stocks when markets reach peaks (NIfty P/E 24 & above).

[Abhijit]

Thanks so much. Can I buy more keeping long term prospect in mind.

[rmani84]

Thanks so much. Can I buy more keeping long term prospect in mind.

Yes, Accumulate only on dips like these for long term and book profits when Nifty hits P/E of 23 and over. Cheers