STOCK WATCH
Indian Sucrose (Code No: 500319) (Rs.56) which recently acquired a Punjab based sugar company having a capacity of 2500 TCD, came out with satisfactory numbers for the Dec’05 qtr. Its Sales grew by 60% to Rs.27 cr. but PBT remaining flat at Rs.4.32 cr. Due to higher tax provision its NP was 14% lower at Rs.3.60 cr. which works out to an EPS of Rs.2.30 for the qtr. For FY06, it may report an EPS of Rs.7~8 EPS but for FY07 it can report bumper profits as it will get the dual benefit of capacity expansion as well as higher sugar prices. It can even report an EPS of Rs.15 for FY07. Moreover from this season it has expanded its crushing capacity from 3500 to 5000 TCD. Scrip has the potential to double in 15 months.
Long-term investors can take this opportunity to accumulate Tinplate (Code No: 504966) (Rs.82) as it has corrected sharply post its Dec.’05 qtr. numbers. Though there was some pressure on margin in this qtr., still it reported higher profit in absolute terms due to increase in sales volume. Its sales and NP have both increased by whopping 80% to Rs.108 cr. and Rs.8.30 cr. respectively. This works out to a quarterly EPS of Rs.3 on its current equity of Rs.28.91 cr. For the full year, it is expected to report an EPS of Rs.14 and with the company undergoing a massive expansion, it’s a good long-term bet.
Winsome Textiles (Code No: 514470) (Rs.28) is one of the cheapest textile scrips available on the bourses. It has once again reported excellent numbers for the Dec.’05 qtr. Its Sales grew by 26% to Rs.36 cr. and NP stood at Rs.0.95 cr. against a net loss of Rs.0.33 cr. last year. With lower cotton prices and higher demand for yarn, the future looks very promising for the company and it can report a topline of Rs.135 cr. and bottomline of Rs.3.50 cr. for FY06. This works out to an EPS of Rs.6 on its tiny equity of Rs.5.90 cr. Its book value is Rs.46 and the current market cap is only Rs.15 cr. The only negative factor is high debt as it debt equity ratio is almost 2.80. Still it’s a 2~3 bagger in the long run.
Shasun Chemicals (Code No: 524552) (Rs.97) is one of the world’s largest producer of Ibuprofen with exports to more than 150 countries. It is setting up a commercial facility for creation of significant biotechnology capabilities & capacities especially in the area of protein processing solutions and has already set up a pilot scale fermentation unit. It’s also transforming itself into a CRAMS centric business model. For the Dec.’05 qtr., its total revenue grew by 30% to Rs.99 cr. whereas NP jumped 43% to Rs.12.90 cr. i.e. EPS of nearly Rs.3 for the qtr. Several other positive developments will make the company attract much better valuation in future. Recently, it has also acquired the custom synthesis business of the Rhodia group of France. Scrip has the potential to appreciate 50% in 12 months and may even double in 18 months. Institutional Investors are also quite active in the counter.
Long-term investors can take this opportunity to accumulate Tinplate (Code No: 504966) (Rs.82) as it has corrected sharply post its Dec.’05 qtr. numbers. Though there was some pressure on margin in this qtr., still it reported higher profit in absolute terms due to increase in sales volume. Its sales and NP have both increased by whopping 80% to Rs.108 cr. and Rs.8.30 cr. respectively. This works out to a quarterly EPS of Rs.3 on its current equity of Rs.28.91 cr. For the full year, it is expected to report an EPS of Rs.14 and with the company undergoing a massive expansion, it’s a good long-term bet.
Winsome Textiles (Code No: 514470) (Rs.28) is one of the cheapest textile scrips available on the bourses. It has once again reported excellent numbers for the Dec.’05 qtr. Its Sales grew by 26% to Rs.36 cr. and NP stood at Rs.0.95 cr. against a net loss of Rs.0.33 cr. last year. With lower cotton prices and higher demand for yarn, the future looks very promising for the company and it can report a topline of Rs.135 cr. and bottomline of Rs.3.50 cr. for FY06. This works out to an EPS of Rs.6 on its tiny equity of Rs.5.90 cr. Its book value is Rs.46 and the current market cap is only Rs.15 cr. The only negative factor is high debt as it debt equity ratio is almost 2.80. Still it’s a 2~3 bagger in the long run.
Shasun Chemicals (Code No: 524552) (Rs.97) is one of the world’s largest producer of Ibuprofen with exports to more than 150 countries. It is setting up a commercial facility for creation of significant biotechnology capabilities & capacities especially in the area of protein processing solutions and has already set up a pilot scale fermentation unit. It’s also transforming itself into a CRAMS centric business model. For the Dec.’05 qtr., its total revenue grew by 30% to Rs.99 cr. whereas NP jumped 43% to Rs.12.90 cr. i.e. EPS of nearly Rs.3 for the qtr. Several other positive developments will make the company attract much better valuation in future. Recently, it has also acquired the custom synthesis business of the Rhodia group of France. Scrip has the potential to appreciate 50% in 12 months and may even double in 18 months. Institutional Investors are also quite active in the counter.
GM Breweries (Code No: 507488) (Rs.67), which is the largest manufacturer of country liquor in Maharashtra has announced its Dec.’05 qtr. numbers. Interestingly, with every passing qtr. the company is improving its operating profit margin. Its Sales tripled to Rs.41 cr., while the NP zoomed to Rs.3.04 cr. against Rs.18 lakh last year. Maintaining the same growth for FY06, it may clock a turnover of Rs.150 cr. and NP of Rs.8 cr., which will lead to an EPS of Rs.9 on its current equity of Rs.9.36 cr. In spite of being a Rs.150 cr. company, its current market cap is merely Rs.60 cr. which leaves ample scope for appreciation in future. The scrip is bound to cross Rs.100 sooner or later.
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