RIL Company Analysis – MJLBD

Mobile Jamuna Ltd. Bangladesh – Equity Research Report

MJLBD is a company that is cooperatively owned by Jamuna Oil Company, a subsidiary of government-owned Bangladesh Petroleum Corporation, and EC Securities Limited, a subsidiary of East Coast Group.

The lubricants industry size in Bangladesh is around BDT. 70 Billion. It is expected to grow with an estimated CAGR of 5%. As our country is developing day by day, the lifestyles of the people are moving towards betterment. Their economic conditions are improving. With the rapid growth of population and the country being converted into a developing country, the industries and transportation system are expanding. Therefore, the demand for lubricants is growing in a parallel way. There are two segments of the lube market in Bangladesh. One is the automotive sector and another one is the industrial sector. Of the total demand for lubricants available in our market, 70% is in the automotive sector and the rest 30% in the industrial sector. While diving into the automotive sector, 32% of the demand was in the passenger vehicle segment, 62% in the commercial vehicle segment, and the rest 6% in the motorcycle segment.

With a vision of Bangladesh being one of the few countries in the region for blending high-quality lubricants, MJL Bangladesh has been operating its business successfully for over two decades. To retain its market leadership, MJL focuses on long-term business sustainability and selling productivity with consistent growth potential. It promises to support its customers with unsurpassed technical expertise for continuous value addition while ensuring and maintaining product integrity.

The current market capitalization of MJLBD is around 28.57B which is around 0.524% of the total market cap of the broad index of the Dhaka Stock Exchange (August 09, 2021).

MJLBD recorded revenue of BDT 18.87 B in the last calendar year. The revenue of the company grew with a CAGR of 7.2% over the last five years.

The current market price of MJL Bangladesh is BDT 90.9 (August 09, 2021). But the intrinsic value of the company is around BDT 127.5. Therefore, it can be said that MJLBD is undervalued with its’ current market price. There may be a potential return on buying the share at this current price.

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Disclaimer

This document is prepared by the research team of Royal Capital Limited. This is based on the publicly provided information by MJL Bangladesh and our research. We do not rely on any insider information.

This report does not influence the investors to buy and sell the equity.