STOCK WATCH
From the recent high of Rs 370 in Jan’08, Bilpower (160.00) has crashed more than 50% in last two months. It is one of the well known players in the field of manufacturing transformers of all types, electrical laminations, stampings and cores. Besides it’s a leading trader of CRGO & CRNGO and produces the largest range of transformer cores in India. For future growth, it tookover a private company namely Tarapur Transformers for 3.40 cr which has an installed capacity of 1500 MVA for repair of power transformers up to 200 MVA, 220 KV Class. Soon company is expected to start manufacturing power transformers also of its own. Besides, it amalgamated Sun Transtamp Private Limited, a company involved into manufacturing of electrical lamination. Importantly, Bilpower is foraying into transmission & distribution segment of power sector as it has been qualified as the ‘turnkey contractor’ for the EPC business by Maharashtra State Electricity Distribution Company Ltd. Further it is in the midst of setting up manufacturing activities for motor stampings in Wada. As per market rumors company has is likely to enter a joint venture with NTPC which will change its fortune. Recently company allotted 20 lac warrants to be converted @ Rs 350 to promoters. For FY08 it is estimated to clock a turnover of Rs 300 cr and PAT of Rs 21 cr i.e. EPS of Rs 23 on current equity of Rs 9 cr. And for FY09 it can report an EPS of Rs 28 on fully diluted equity of Rs 12.50 cr. Keep accumulating at declines.
Belonging to IFB Group, IFB Agro (55.00) is engaged in the production of Extra Neutral Alcohol (Rectified Spirit), IMFL and Marine Products. It boasts of having very successful and leading brands like Volga Vodka, Gold Cup Brandy, Blue Lagoon Gin & IFB Select Whisky under the IMFL segment. Company is also a pioneer in 50* UP category with bestselling brands like Baluba Rum, 3 Cheers Whisky & Russki Vodka. In order to reduce its dependence on molasses and for providing better quality of potable spirit, company had undertaken a project to produce spirit from the grains. This project recently got completed and commenced its operation from Sept 2007. On the other hand its marine division last year launched its first ready to fry product "PRAWN POPS" and has plan to introduce more such products in the ready to cook and ready to eat segment. Infact its marine division is poised to become an integrated business and serve all the inputs from the farm to the final consumer. Although it reported poor nos for Dec qtr still for the first nine months sales increased by 15% to Rs 156 cr and NP stood at Rs 6.40 cr. Hence it may end FY08 with topline and bottomline of Rs 200 cr and Rs 10 cr respectively i.e. EPS of Rs 13 on equity of Rs 7.70 cr. But at sharp declines.
Sundaram Brake Lining (245.00) - part of a TVS group, is engaged in manufacturing of automotive, non-automotive and industrial friction materials with specialization in asbestos-free brake linings and pads. Its products are extensively used in commercial vehicles, passenger cars, tractors (agricultural) and motor cycles. Apart from being the preferred supplier to some of the well known axle manufacturers as original equipment it also services the Indian aftermarket through more than 140 TVS owned wholesaler outlets spread across major towns. Moreover to service the US and Canadian markets instantly and establish a brand recognition, company has a warehouse facility in North America along with a business representative in USA who works closely with the US/Canadian brake re-builders and distributors. In view of changing trends, from drum brake linings to disc brakes for commercial vehicles the company is giving special focus on CV Pad business and in the process has created a wide range of 39 references and are aggressively marketing the same worldwide. With more and more countries banning use of asbestos based friction material products, the future prospects of company, being a pioneer looks promising. For FY08 it is estimated to report total sales of Rs 190 cr and profit of Rs 14.50 cr i.e. EPS of Rs 54 on very tiny equity of Rs 2.70 cr. Good opportunity to buy at such cheap valuations.
Murudeshwar Ceramics (58.00) is one of the leading manufacturers of vitrified tiles, ceramic tiles and granites in India with its popular brand 'NAVEEN’. Importantly, company derives nearly 80% of revenue from sales of vitrified tiles which enjoy higher margin than the rest two. On the back of constant expansion, its present capacity stands at 6.3 million sq mtr of vitrified tiles, 2.7 million sq mtr of ceramic tiles and only 72,000 sq mtr for granites. Notably, institutional clients constitute 60% of total sales and retail clients constitute balance 40%. This is backed by a strong marketing network with 6 distributors, 74 show rooms, 45 depots and about 400 dealers spread across India. With the ongoing boom in construction sector, increasing mall culture and strong demand for hi-tech commercial complexes, the future prospect of the company is quite promising. It is expected to report a topline of Rs 240 cr and bottomline of Rs 26 cr on conservative basis for FY08. This works out to an EPS of Rs 15 on equity of Rs 17.50 cr. Notably, its Cash EPS stands at whopping Rs 30. As current fiscal being a silver jubilee year for the company, it may declare liberal bonus or special dividend for its shareholders. At CMP, scrip is trading at a P/E ratio of less than 4x times and is available at an EV of 300 cr which is well below its gross block value of Rs 470 cr. However, icing on the cake is the 20 acres surplus land owned by the company near electronic city where it intends to develop IT park. A screaming buy
Belonging to IFB Group, IFB Agro (55.00) is engaged in the production of Extra Neutral Alcohol (Rectified Spirit), IMFL and Marine Products. It boasts of having very successful and leading brands like Volga Vodka, Gold Cup Brandy, Blue Lagoon Gin & IFB Select Whisky under the IMFL segment. Company is also a pioneer in 50* UP category with bestselling brands like Baluba Rum, 3 Cheers Whisky & Russki Vodka. In order to reduce its dependence on molasses and for providing better quality of potable spirit, company had undertaken a project to produce spirit from the grains. This project recently got completed and commenced its operation from Sept 2007. On the other hand its marine division last year launched its first ready to fry product "PRAWN POPS" and has plan to introduce more such products in the ready to cook and ready to eat segment. Infact its marine division is poised to become an integrated business and serve all the inputs from the farm to the final consumer. Although it reported poor nos for Dec qtr still for the first nine months sales increased by 15% to Rs 156 cr and NP stood at Rs 6.40 cr. Hence it may end FY08 with topline and bottomline of Rs 200 cr and Rs 10 cr respectively i.e. EPS of Rs 13 on equity of Rs 7.70 cr. But at sharp declines.
Sundaram Brake Lining (245.00) - part of a TVS group, is engaged in manufacturing of automotive, non-automotive and industrial friction materials with specialization in asbestos-free brake linings and pads. Its products are extensively used in commercial vehicles, passenger cars, tractors (agricultural) and motor cycles. Apart from being the preferred supplier to some of the well known axle manufacturers as original equipment it also services the Indian aftermarket through more than 140 TVS owned wholesaler outlets spread across major towns. Moreover to service the US and Canadian markets instantly and establish a brand recognition, company has a warehouse facility in North America along with a business representative in USA who works closely with the US/Canadian brake re-builders and distributors. In view of changing trends, from drum brake linings to disc brakes for commercial vehicles the company is giving special focus on CV Pad business and in the process has created a wide range of 39 references and are aggressively marketing the same worldwide. With more and more countries banning use of asbestos based friction material products, the future prospects of company, being a pioneer looks promising. For FY08 it is estimated to report total sales of Rs 190 cr and profit of Rs 14.50 cr i.e. EPS of Rs 54 on very tiny equity of Rs 2.70 cr. Good opportunity to buy at such cheap valuations.
Murudeshwar Ceramics (58.00) is one of the leading manufacturers of vitrified tiles, ceramic tiles and granites in India with its popular brand 'NAVEEN’. Importantly, company derives nearly 80% of revenue from sales of vitrified tiles which enjoy higher margin than the rest two. On the back of constant expansion, its present capacity stands at 6.3 million sq mtr of vitrified tiles, 2.7 million sq mtr of ceramic tiles and only 72,000 sq mtr for granites. Notably, institutional clients constitute 60% of total sales and retail clients constitute balance 40%. This is backed by a strong marketing network with 6 distributors, 74 show rooms, 45 depots and about 400 dealers spread across India. With the ongoing boom in construction sector, increasing mall culture and strong demand for hi-tech commercial complexes, the future prospect of the company is quite promising. It is expected to report a topline of Rs 240 cr and bottomline of Rs 26 cr on conservative basis for FY08. This works out to an EPS of Rs 15 on equity of Rs 17.50 cr. Notably, its Cash EPS stands at whopping Rs 30. As current fiscal being a silver jubilee year for the company, it may declare liberal bonus or special dividend for its shareholders. At CMP, scrip is trading at a P/E ratio of less than 4x times and is available at an EV of 300 cr which is well below its gross block value of Rs 470 cr. However, icing on the cake is the 20 acres surplus land owned by the company near electronic city where it intends to develop IT park. A screaming buy
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