The company is known as one from the Tata stable as they were one of the promoters holding 28.56 per cent stake through Forbes Gokak and its associates. Recently, the other promoter Kansai Paint, Japan has bought out their stake at Rs 250 per share, when the market price was Rs 180 per share, reflecting the confidence of the promoters in the company.

After this acquisition, the foreign promoter would hold around 63 per cent. Though the company's total market share in the paint industry, as a whole, is 18 per cent, it is the industry leader in the industrial paints segment with 43 per cent market share. Its major presence is in the automobile sector.

Auto MNCs such as Toyota, Hyundai, Ford, General Motors figure prominently among its list of clients. It has also been slowly extending its market share in two and three wheeler segments. The increase in offtake of automobiles is sure to brighten up things for Goodlass.

Besides this, the company's continuing efforts in penetrating the home appliances market seems to have paid off. Its products include intermediate coates, top coates, pre-ritment chemical, electro diogestion etc. New range of automotive paints such as zola coat, satin, gumtex elastic have been launched in the market during the last one year.

The company's pigment division was dragging the bottomline down. In a bid to revamp operations, the division has been sold off and intensive product-wise marketing strategy is being followed instead of earlier extensive marketing strategy.

On the financial side, the sales volumes have been growing from the first quarter to the third quarter, but the total expenditure was not under control, which resulted in negative growth in net profit. However, stringent operational cost-cutting was implemented during the quarter ended December 31, 1999 and the results were obvious.

The topline grew by 22 per cent and total expenditure by 17 per cent, as the company focused its emphasis on volume growth. Some marginal price increases were also effected to cover up the increase in cost of raw materials such as anhydrides and resins.

During the period under review, other income was up at Rs 3.89 crore compared to Rs 1.59 crore. Though increase in depreciation has negated the impact of reduction in interest cost on the book profit, the cash profit got a boost. Even after allowing for taxation provision which was three times over the corresponding period of fiscal 1999, the bottomline has rocketed to Rs 9.86 crore showing 207 per cent rise. Judging by the current trend, the company is expected to end the year with an EPS of Rs 25.

The Goodlass stock is quoting at Rs 135, which gives a P/E ratio of 6 whereas the P/E ratio for the industry leader Asian Paints has been hovering around 20. This clearly points towards future scope for the discounting to improve. Also, the free reserves are at Rs 143 crore, nearly ten times of equity capital, making it a prime candidate for a bonus issue.