Business Plan of Bpbl

Parvez M. Chowdhury

(880) 174 167 4023; parvez@bracepl.com

Berger Paints Bangladesh Limited

December 2009

Company Summary 52-week Price Range (BDT) Current Price 12-month Target Price Dividend Yield Total Return Number of Shares MM Market Cap BDT MM BDT MM Revenue Ops Income Net Income Margins Gross Margin Operating Margin Net Margin Growth Revenue Growth Operating Income Growth Net Income Growth Per Share EPS Dividend Book Value/Share Cashflow BDT MM Operating Capex Dividend Valuation P/E P/B ROE Miscellaneous BDT MM Total Debt Cash Debt/Equity

700

Rating: Fairly Valued Target Price: BDT 550

247.50 - 655.00 569.60 550.00 2% -1% 23.2 13,208.4 2008A 530.4 400.7 30% 12% 9% 28% 17% 18% 17.28 12.00 39.26 342.9 -102.0 -278.3 33.0x 11.5x 44% 0 69.1 0% 2009E 735.7 542.6 35% 14% 10% 17% 39% 35% 23.40 13.00 49.65 633.4 -89.7 -301.5 24.3x 9.0x 47% 0 311.1 0%

350

2010E 873.3 644.8 35% 14% 10% 18% 19% 19% 27.81 14.00 63.46 700.2 -85.7 -324.6 20.5x 7.1x 44% 0 597.0 0%

Thousands

4,499.2 5,273.5 6,204.1

Berger Paints Bangladesh Limited is the largest paint manufacturer and distributor in Bangladesh. With its strong distribution network, Berger has reached most part of the country. The company has successfully established itself as one of the most recognizable brands and a supplier of modern paint solutions. The company maintained a healthy and steady growth rate in sales, with an average of 27% in the last four years. Average ROE is 36% while average ROA is 20% for the last five years. The company also maintained a high dividend payout ratio with an average of 89% for the last five years. The company is currently free of all debt. Despite the stability and success of the company, we believe Berger is fully priced. Consequently, we initiate our coverage of Berger Paints Bangladesh Limited with a “Fairly Valued” rating and a 12-month target price of BDT 550. Our recommendation considers the company’s extensive sales network and its ability to generate...