STOCK WATCH
PBA Infrastructure (82.00) is engaged in execution of civil engineering projects and specializes in construction of highways, dams, runways and heavy RCC structures, bridges and other infrastructure projects of various govt bodies. It is executing projects from Kashmir to Kanyakumari and has taken up new works like toll collection and quarrying to augment its income. For the Sept qtr its revenue grew by 45% to 79 cr whereas NP increased by 20% to 4.20 cr. Half yearly figures are much more encouraging. Notably, company has been regularly bagging new orders and its current order book position is around 650 cr. Fundamentally, company is having a huge debt of 170 cr due to which its interest cost is very high. However, to fund its working capital requirement and reduce the high cost debt, it is looking to raise capital thru equity route in near future. Meanwhile it is estimated to clock a turnover of 375 cr and PAT of 17 cr for FY08. This translates into EPS of 13 Rs on current equity of 13.50 cr. Hence scrip is trading at a P/E ratio of approx 6x times. Considering the 52 week H/L as Rs 157/72, this is one of the safest & cheapest bet in the high growth infrastructure sector.
Datamatics Technologies (35.00) is a premier provider of business process outsourcing (BPO) and knowledge processing outsourcing (KPO) solutions with specialization in accounting, claims, payroll, tax services, legal matters, content management, abstracting & indexing, document & workflow management, data warehousing, and business intelligence solutions. It delivers reliable services to a host of international clients, including six of the top 25 Fortune 500 companies and having its consulting services practice certified at CMM Level 5 by the Software Engineering Institute. Due to sharp rupee appreciation coupled with rising salary levels, it reported pathetic nos for the last two quarters. Hence its share price crashed from a high of Rs 86 in Feb’07 to Rs 35 now leading to the current market cap of 140 cr. Ironically, company is holding liquid cash to the tune of 105 cr out of which nearly 100 cr is invested in mutual funds which will be generating more than 10 cr of other income. Being a debt free, company is actually available for 10 Rs per share. Moreover company has finalized to merge Datamatic Ltd - a group company with itself which apart from making its balance sheet stronger, will also de-risk its business model as well. To conclude it’s a screaming buy with negligible downward risk.
Shilp Gravures (55.00) is undisputed leader in electro-mechanical engraving, with a substantial market share of around 40% for flexible packaging industry in India. In simple terms it manufactures electronically gravure/engraved cylinders which are eventually used for rotogravure printing. It has a 300-strong client list which includes India's most reputed names like HLL, Britannia, Amul, Nestle, Cadburys, Tata Tea, Pepsi Foods, Haldiram, P&G, Reliance, ITC, Colgate, Mcdowells etc thereby having a pan India presence. It reported fantastic set of nos for the Sept qtr. Sales improved by 50% to Rs 9.15 cr and profit jumped up 60% to Rs 2 cr. It was also successful in improving its OPM by 200 basis point to 46% against 44% last fiscal. Importantly, its half yearly profit stands at 3.50 cr which is 20% higher than the entire FY07 net profit of 2.90 cr. Hence accordingly it may end FY08 with sales of 38 cr and NP of 6.50 cr which leads to an EPS of 11 Rs on equity of 6.15 cr. just buy and relax as the share price can easily appreciate by 50% in 9-12 months.
Presently, IT sector is totally out of flavor with most of the scrips hitting new lows. And Helios & Matheson (100.00) is no exception with its share price tumbling down to 100 Rs from the high of 190 Rs in June’07. However, on a consolidated basis it announced decent set of nos for the Sept qtr. Total revenue grew by 35% to Rs 110 cr but PAT remained flat at Rs 15 cr. More importantly, company was able to maintain its profit margin due to proactive hedging strategy, offshore leverage, better pricing and cost management. It has also expanded its facilities in Mahindra world city, a multi product special economic zone and international tech park, Chennai, in addition to competency centres in califorma, newyork and newjersey. Notably, its subsidiary “The A Consulting Team Inc” now renamed as “Helios & Matheson North America” has completed ten successful years of listing in the NASDAQ. Financially, against its market cap of 275 cr, company is holding cash equivalent worth of Rs 80 cr and its consolidated gross block stands at 220 cr. Out of the total debt of Rs 150 cr, Rs 115 cr is towards FCCB which will be converted into equity share @ Rs 130 and hence actual debt is only Rs 35 cr. To conclude, it may end FY08 with topline of Rs 450 cr and NP of Rs 55 cr on consolidated basis i.e. EPS of Rs 19 on fully diluted equity of approx Rs 29 cr. A good bet in mid cap IT space.
Datamatics Technologies (35.00) is a premier provider of business process outsourcing (BPO) and knowledge processing outsourcing (KPO) solutions with specialization in accounting, claims, payroll, tax services, legal matters, content management, abstracting & indexing, document & workflow management, data warehousing, and business intelligence solutions. It delivers reliable services to a host of international clients, including six of the top 25 Fortune 500 companies and having its consulting services practice certified at CMM Level 5 by the Software Engineering Institute. Due to sharp rupee appreciation coupled with rising salary levels, it reported pathetic nos for the last two quarters. Hence its share price crashed from a high of Rs 86 in Feb’07 to Rs 35 now leading to the current market cap of 140 cr. Ironically, company is holding liquid cash to the tune of 105 cr out of which nearly 100 cr is invested in mutual funds which will be generating more than 10 cr of other income. Being a debt free, company is actually available for 10 Rs per share. Moreover company has finalized to merge Datamatic Ltd - a group company with itself which apart from making its balance sheet stronger, will also de-risk its business model as well. To conclude it’s a screaming buy with negligible downward risk.
Shilp Gravures (55.00) is undisputed leader in electro-mechanical engraving, with a substantial market share of around 40% for flexible packaging industry in India. In simple terms it manufactures electronically gravure/engraved cylinders which are eventually used for rotogravure printing. It has a 300-strong client list which includes India's most reputed names like HLL, Britannia, Amul, Nestle, Cadburys, Tata Tea, Pepsi Foods, Haldiram, P&G, Reliance, ITC, Colgate, Mcdowells etc thereby having a pan India presence. It reported fantastic set of nos for the Sept qtr. Sales improved by 50% to Rs 9.15 cr and profit jumped up 60% to Rs 2 cr. It was also successful in improving its OPM by 200 basis point to 46% against 44% last fiscal. Importantly, its half yearly profit stands at 3.50 cr which is 20% higher than the entire FY07 net profit of 2.90 cr. Hence accordingly it may end FY08 with sales of 38 cr and NP of 6.50 cr which leads to an EPS of 11 Rs on equity of 6.15 cr. just buy and relax as the share price can easily appreciate by 50% in 9-12 months.
Presently, IT sector is totally out of flavor with most of the scrips hitting new lows. And Helios & Matheson (100.00) is no exception with its share price tumbling down to 100 Rs from the high of 190 Rs in June’07. However, on a consolidated basis it announced decent set of nos for the Sept qtr. Total revenue grew by 35% to Rs 110 cr but PAT remained flat at Rs 15 cr. More importantly, company was able to maintain its profit margin due to proactive hedging strategy, offshore leverage, better pricing and cost management. It has also expanded its facilities in Mahindra world city, a multi product special economic zone and international tech park, Chennai, in addition to competency centres in califorma, newyork and newjersey. Notably, its subsidiary “The A Consulting Team Inc” now renamed as “Helios & Matheson North America” has completed ten successful years of listing in the NASDAQ. Financially, against its market cap of 275 cr, company is holding cash equivalent worth of Rs 80 cr and its consolidated gross block stands at 220 cr. Out of the total debt of Rs 150 cr, Rs 115 cr is towards FCCB which will be converted into equity share @ Rs 130 and hence actual debt is only Rs 35 cr. To conclude, it may end FY08 with topline of Rs 450 cr and NP of Rs 55 cr on consolidated basis i.e. EPS of Rs 19 on fully diluted equity of approx Rs 29 cr. A good bet in mid cap IT space.
No comments:
Post a Comment