Numeric Power System Ltd - 440.00 Rs

Incorporated in 1995, Numeric Power System Ltd (NPSL) is a leading manufacturer of uninterrupted power supply (UPS) systems, stabilizers and power conditioners in India. Infact, it has been the undisputed leader for online, offline/ interactive UPS in India for more than a decade. Ranging from 0.5 KVA to 4800 KVA, company offers the total range of 1 Phase and 3 Phase UPS systems that are built with advanced technology and state-of-the-art features suitable for unitary and parallel redundant configurations addressing a wider band of the industry from PCs, servers, banks, data centers, healthcare and large IT network protection. Apart from products, it also undertakes turnkey projects and offers end to end solution for SCADA/EMS package, large network of industrial process, power transmission support systems and distribution management. It also provides services such as annual maintenance contracts of UPS and power conditioners of not only its own brands but also for other brands. NPSL has been regularly exporting its products to Canada, UK, China, South America, Singapore, Vietnam, Mauritius, Dubai, South Africa, Nigeria, Kenya, Ethopia, Uganda etc. Incidentally, NPSL is a national distributor for a range of ‘Panasonic’ brand of sealed lead acid batteries.

NPSL has eight world class manufacturing facilities spread across Pondichery-TN, Chennai-TN, Parvanoo-HP and Colombo-Srilanka, thereby emerging as the biggest integrated manufacture of UPS in India. The company's fully-owned subsidiary in Sri Lanka, Singapore, Mauritius and an export-processing unit in Chennai cater to the overseas markets. In India, it has a strong distribution network through 1800 channel partners spread across 400 towns. This is backed by 201 sales and service location apart from specialized 27 test and repair centre along with exclusive helpdesk which works 24x7. It has an enviable and high profile clientele including Infosys, Siemens, Intel, Philips, Microsoft, Veritas, HDFC, Citibank, ICICI, RBI, NIC, Reliance, ABB, BMW, NCR, Nokia, major stock exchanges etc. Interestingly, around 75% of the ATMs in the country are fitted with UPS supplied by NPSL. Last year, the company implemented an auxiliary power systems project for Power Grid Corporation in the entire north-eastern States, in a turnkey effort involving design, supply and installation of total power conditioning systems.

For future growth NPSL has adapted the latest power conversion techniques combined with advanced digital controls in the newly designed ‘NUMERIC DIGITAL HPX’ series in addition to the HP and HPE models which are already deployed in the market under power ratings from 2 to 60 KVA. This new version HPX series is designed to primarily address IT and Industrial requirements including intelligent monitoring using Internet. After terminating its 10 year tie-up with Meril Gerin Asia in 1996, company lately entered into a joint venture with the French UPS major SOCOMEC SA to distribute, market and service the 3 phase range of UPS systems (greater than 10 KVA) products to customers in India. To consolidate its operation, NPSL has recently demerged the UPS manufacturing business of Numeric Electronics Pvt Ltd (NEPL) and got merged it with itself against allotment of 52,920 equity share to NEPL.

With more and more businesses running on technology solutions, the need for power protection systems for reliability and quality has become vital. Given India's significant power deficits and the ubiquitous outages and voltage fluctuations; NPSL’s products have significant market potential in the country. For FY07, it recorded 20% growth in sales to 272 cr whereas NP increased by 10% to 18.80 cr posting an EPS of 38 Rs on small equity of 5 cr. For the first quarter, sales jumped up 30% to 76 cr but NP zoomed up 75% to 8.9 cr against 5.10 cr last year. Accordingly for full year FY08 it may report sales of 325 cr and profit of 24 cr. This works out to an EPS of 48 Rs on equity of 5.05 cr. At current market cap of 220 cr, company is available reasonably cheap and deserves better valuation being in a high growth sector. Hence investors are recommended to accumulate at declines with a price target of 575 Rs (i.e. 30% appreciation) in 9¬12 months.