Company Analysis on MJL Bangladesh PLC
Company Analysis on MJL Bangladesh PLC
MJL Bangladesh PLC (MJLBD), a joint venture between EC Securities Ltd. and Jamuna Oil Company Ltd., stands as a market leader in Bangladesh’s fuel, lubricant, and LPG sectors. As the exclusive local partner of ExxonMobil, the company operates a state-of-the-art lube oil blending plant and maintains a strong portfolio through its subsidiaries: Omera Petroleum Ltd. (62.49% of share holds by MJL Bangladesh), Omera Cylinders Ltd.(99.98% share holds by MJL Bangladesh), and Omera Gas One(OPL holds 50% share of Omera Gas One LTD).
In FY’24, MJLBD achieved consolidated revenue of BDT 36,262 million, an 18% YoY increase, largely driven by the LPG business through Omera Petroleum, which contributed 66% to total revenues. Despite this growth, net profit slightly declined by 0.1% due to increased operating costs and adverse currency movements. The company’s five-year revenue and net profit CAGR stand at 17.7% and 10.7% respectively. Omera Petroleum posted an impressive 147% profit growth, while Omera Cylinders saw a 122% net profit increase, reflecting MJLBD’s effective cost management and scale efficiencies.
MJL Bangladesh PLC (MJLBD) stated strong financial growth, making it an attractive investment opportunity. The company has shown a steady increase in assets, rising from BDT 39,198 million in Q2’23 to BDT 46,498 million in Q2’24 (increased by 18.62%)alongside significant revenue growth from BDT 17,870 million to BDT 22,898 million (increased by 28.1%) over the same period.
Net profit and EPS have also improved consistently, with EPS reaching BDT 6.86 in Q2’24, reflecting strong shareholder value creation. Additionally, efficient cost management and rising operating profit indicate solid business fundamentals. However, increasing liabilities, which grew by 24.72% within a year to BDT 28,725 million, pose a financial risk that needs monitoring. To maintain profitability, MJLBD should focus on cost control, efficient working capital management, and tax optimization while capitalizing on its revenue momentum.
Looking ahead, MJLBD is well-positioned for sustainable growth, supported by rising demand, infrastructure development, and diversification in energy solutions. While challenges such as inflation, foreign exchange volatility, and a fragmented lubricant market persist, the company’s strategic initiatives including SNG introduction, jetty construction, and expanded LPG fleet enhance its long-term prospects.
MJLBDPLC’s current share price of BDT 94.2 is well below its intrinsic value of BDT 159.6, indicating a 69.4% growth potential. This margin of safety highlights a promising opportunity for investors. Realizing this potential depends on the company’s ability to manage risks and leverage industry growth.