STOCK WATCH

South India Paper Mills (50.00) declared flat performance for the March’09 qtr as sales declined marginally to Rs 27 cr and PAT remained flat at Rs 2.10 cr. It reported an OPM of 15% which is highest in the last four quarters. However for entire FY09 it reported a 30% decline in net profit to Rs 8.25 cr on flat sales of Rs 126 cr. This translates into EPS of Rs 11 on equity of Rs 7.50 cr. Despite a sharp fall in profit, company declared the same amount of dividend i.e. 30% as given last year which proves the investors friendly attitude of the management. At CMP the dividend yield works out to an healthy 6%. Company is having strong presence in packing paper and paper boards apart from manufacturing writing and printing paper. On back of robust demand, company is implementing a brown field expansion with an investment of about 110 cr under which it will more than double its paper manufacturing capacity to 115,000 TPA from 55,000 TPA currently. It will also be augmenting its captive power generation capacity by 3.50 MW. Besides expansion, company is going for forward integration into high quality corrugated boards and intends to have at least one 100% owned facility and possibly one facility under joint venture near Chennai. It is one of well managed company which has the potential to clock an EPS of 16~18 Rs for FY10. Scrip can easily appreciate 50% within a year.

Although share price of Gremach Infrastructure’s (40.00) has more than doubled in short time and also has an operator play, still aggressive investors can buy at current levels. It hasn’t yet declared its March’09 quarter performance and is expected to come out with its nos by end of this month. Company’s main activity is to provide rental of construction/earthmoving machineries to infrastructure companies including L&T, Punj Lloyd, Shapoorji Pallonji, Gammon India, HCC, Gannon Dunkerley etc. It has a huge asset bank of heavy equipments ranging from compacters, rollers, concrete mixers, dozers, forklifts, loaders to excavators, PTR, dumpers, electronic sensor pavers, kerb laying machine, concrete batching and mixing plant. In addition to renting its owned equipments, it also hires equipments owned by other parties and rent to its own clients. For the first nine months ending Dec’08 it has already registered an EPS of Rs 15 by earning PAT of Rs 23.30 cr on topline of Rs 238 cr. Although off late company has witnessed sharp fall in demand due to slowdown in construction sector, but going forward it is expected to regain normal business. Interestingly, it has got in-principle approval for 100 hectar Metal SEZ at Kolhapur & another at Dhule in Maharashtra. It has also taken 75% controlling stake in 11 Coal mine licenses in Mozambique. To fund its growth plant company has raised almost Rs 200 cr in Feb 2008 thru FCCB route to be converted into equity @ Rs 376 per share. Ironically, share price which hit a high of Rs 504 in Jan’08 went down to hit a low of Rs 18 in March 2009.

Although Rama Paper (10.00) seems to be operator scrip, investors can accumulate it at current levels for handsome gain in long term. Technically scrip has consolidated for long time and has relatively lower risk of downfall. Financially company has once again reported dismissal performance for the March’09 quarter with an profit margin of barely 5% at the operating level. However for entire FY09 it has recorded a decent OPM of more than 13% which is still very low against 19% last fiscal. Interestingly due to lower tax provisioning company has been able to report 25% higher net profit to Rs 3.90 cr for FY09 against Rs 3.00 cr last fiscal. At the same time it sales improved by 25% to Rs 107 cr. Thus company has reported an EPS of Rs 4 for FY09 and is trading at a PE of 2.5x times. Company derives nearly 60% revenue from newsprint segment. Of late it has also put up 6 MW co-generation captive power plant which is fully operational now. Further it has undertaken expansion project of putting MG Machine to manufacture Tissue / Poster Paper thru a capex of Rs 24 cr. In the last two years, promoter have infused more than Rs 15 cr of their own money by taking preferential allotment of 45 lac equity shares @ 35 Rs per share. Recently company has taken approval from the member to convert preference shares of Rs 5 cr to equity shares which may lead to further equity dilution. Despite company having very debt equity ratio it available cheap at a market cap of Rs 7~8 cr. At the same time, investors are informed that promoter’s reputation is now taken well by the market veterans.


Tera Software (38.00) is one of the leading e-governance solution providers, undertaking data entry/scanning works for digitization of information maintained under Right to Information Act. It also undertakes short-term projects like issue of photo ID cards, ration cards and election commission cards. Last year company successfully executed Maharashtra Vikri Kar Seva Project in Maharashtra State (VAT Implementation of Maharastra sales tax department) on BOOR (Build own operate and refresh) model as the scope of work was computerization of sales Tax department in the entire state of Maharashtra. Of late company has been able to procure additionally six new projects of the State Government of Andhra Pradesh, Karnataka, Rajasthan, West Bengal and Himachal Pradesh. It also ventured into imparting computer education in more than 225 schools in Goa and AP by establishing the computer labs with Computers and providing the teaching staff and maintenance of systems. For the latest March’09 quarter it reported 25% decline in net profit to Rs 2.35 cr despite healthy growth of 90% in topline to Rs 29 cr. Accordingly for full FY09 its net profit fell by 15% to Rs 10.50 cr, although its total revenue increased by 40% to Rs 83 cr. This works to an EPS of Rs 8.50 on equity of Rs 12.50 cr. Company is expected to declare 20% dividend which leads to a yield of 5% at CMP. Moreover company has few acres of surplus land in Hyderabad, which it can either sell or enter into JV with infrastructure company. Worth accumulating at sharp declines.

Tantia Constructions Ltd - Rs 55.00

Established during 1964 in Kolkata, Tantia Construction Ltd (TCL) has gradually evolved over the years from a pure railway construction company to a full-fledged infrastructure company executing various diversified projects. Today it boasts of having presence in roads and highways, railways, tunnels, bridges and flyovers, urban instructure, sewerage and drainage, civil & housing construction etc. Lately, company also ventured into the lucrative marine infrastructure space, power transmission and distribution segment and aviation infrastructure. It is among the few companies which have very strong domain expertise in servicing the Indian Railways. Infact, TCL is among the five Indian companies capable of providing ‘foundation-to-finish’ for mega railway bridges spanning 2-km or more. More importantly, TCL has a very strong presence in the eastern and north-eastern region which gives it an edge, as very few players are interested in bidding in these regions due to difficult terrain. Company’s expertise can be evaluated from the fact that it has constructed over 250 km of roads in the hilly areas of Mizoram, coastal areas of Kerala, plains of Punjab/Haryana and plateaus of Karnataka. On the power project front, company has remarkably garnered the capability of in-house manufacturing and erecting transmission towers within a very short time. Incidentally, company has impeccable track record of completing every single assignment since inception. As of now company has expertise in following business segments, domains and verticals.

Roads and highways: TCL ventured into advanced mechanized road construction in compliance with specifications set by the Ministry of Surface Transport in 1990. Since then it has established its credentials in the field of construction, widening, conversion, maintenance, strengthening and beautification of roadways, road bridges, highways and flyovers. It is the only Indian company to have fabricated a 100 metre spans steel girder onsite, 4,000 mtrs above sea-level. Presently this segment is the largest contributor of revenue.

Railway infrastructure: TCL is one of the oldest railway contractors in India with the experience of having completed assignments across diverse terrains for the Eastern Railway, North Eastern Railway, South Eastern Railway and North East Frontier Railway. It provides end to end solution right from survey, designing of track embarkment, earthwork, track laying, bridges, tunnels, electrification and signaling, maintenance of rail road/infrastructure, constructing railway stations and terminals, railway bridges etc. This is the second largest segment for the company & enjoys a pre-qualification for projects up to Rs 450 cr when engaged in international joint ventures. Some of its joint venture partners comprise reputed international names like Road Builder Sdn Berhad, Malaysia.

Urban infrastructure: TCL established its credentials in this segment through a presence in Kolkata improvement projects, its expertise comprising soil re-engineering, mechanized earthwork, hauling for large-scale land development, sewerage & drainage projects, electrification and lighting systems and construction of college & hospital buildings. Today company is well acknowledged by large municipal corporations for its competence in the timely commissioning and completion of urban projects that minimize public inconvenience during construction tenures. TCL is now eyeing urban infrastructure projects in Punjab, Orissa, Delhi and Haryana for the Public Works Department.

Aviation / Marine Infrastructure:
TCL diversified into the marine infrastructure space in 2003 and now possesses proven capabilities in building tunnels, jetties and steel girders along rivers. Subsequently it ventured into the aviation infrastructure space in 2005 through the Dibrugarh Airport project.

Power Transmission projects: TCL entered the power T&D solutions segment in 2005 and is now executes projects involving beam foundation, lattice structure erection, conductor stringing and cable-laying systems. To increase the presence, TCL is contemplating to set up a design dept to enhance plant design engineering.

In recent years TCL has executed various prestigious and large scale projects in the states of West Bengal, Assam, Bihar, Uttar Pradesh, Tamil Nadu, Kerala and Mizoram, and in neighboring countries like Bangladesh, Nepal and Bhutan. As more than 90% of revenue comes from government project it caters to several govt bodies including Indian railways, Kolkatta Metro railway, NHAI, State PWD, Central PWD, State Electricity boards, HIDCO, KMC, Airport Authority of India apart from NTPC, Ircon Int, SAIL, RITES, IOC etc. It enjoys
excellent business relations and has good direct contact with govt resulting in repeat orders of similar nature, extension of projects of a higher value and a listing among preferred partners. Presently, TCL has diversified and huge order in hand position of more than Rs 1500 cr to be executed in next 24~36 months. Thus, company has a strong revenue visibility for coming years.

Going forward TCL is planning to bid for bigger projects in power transmission segment as it has executed few power projects and is now qualified to bid for the same. In near future company intends to foray into BOT & BOOT projects to boost up its margin. It usually takes up complex projects which are insulated from competition. It is also looking to bag airport projects coming up in non- metro cities. To cash on the boom in civil construction, it is even contemplating to enter into real estate development. As a long term strategy, TCL intends to enter in logistics sector by constructing and owning ware-houses at strategic places across India. Water treatment, solid waste management and sewage treatment are also being considered to widen its work profile.

In March 2006, TCL came out with an IPO of 1.125 cr of equity shares @ Rs 50 per share with public net offer of 42.50 lakh shares. The issue was oversubscribed by whopping 83x times. Ironically, against the high of Rs 310 in 2006, scrip tumbled down to hit a low of below Rs 30 in 2009. This is despite the fact that its fundamentals have improved considerably in last couple of years. Even for latest March’09 quarter it reported excellent performance by clocking on operating margin of impressive 15%. Thus is registered 160% jump in net profit to Rs 12.50 cr although its topline remained flat at Rs 169 cr. Effectively for entire FY09, its PAT improved by 12% to Rs 17.25 cr and revenue increased by 25% to Rs 450 cr thereby posting an EPS of Rs 11 on current equity of Rs 15.57 cr. With such an fat order book of Rs 1500 cr company can easily grow at 30~50% CAGR for next couple of years at least. Thus it has potential to report an EPS of Rs 14~15 for FY10. In order to fund its projects & working capital company has raised around Rs 30 cr thru FCCB route to be convertible into equity shares @ Rs 140. Considering the CMP, the possibility of conversion in near future seems bleak, hence not considered in calculating the diluted equity. Being discounted at less than 4x times, this scrip is available fairly cheap. Hence investors are recommended to buy at current levels as share price can double in 12~15 months.

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MIC Electronics (45.00) is a pioneer in design, development, manufacture & supply of true color LED Video Displays, LED Lighting products and solutions. Infact, it is the only integrated LED display manufacturer in India with design-to-manufacture capabilities. Being a sunrise technology, its products have tremendous potential for growth and hence to cash on the opportunity, company commissioned a state of the art fully automated manufacturing line at Hyderabad last year. With this EOU facility, it has doubled the production capacity of LED display to 2400 modules from 1200 modules earlier. It is further contemplating to take its total capacity to 3600 modules in near future. To maintain the growth momentum, it is setting up of manufacturing unit for LED true colour displays, LED lighting solutions and solar based LED lighting products at Fab City SEZ near Hyderabad for which it has already been allotted 50 acre of land on lease. Lately, company has got the RDSO approval for its unique & innovative video cum train info display system thereby becoming the first and only company to get such approval. Operationally, company has reported dismissal performance for the last two quarters due to general economic slowdown. However for FY09 ending June’09 it is estimated to clock a turnover of Rs 260 cr and PAT of Rs 65 cr on a standalone basis which works out to an EPS of Rs 6.50 on current equity of Rs 20 cr having face value as Rs 2/- per share. Keep accumulating at every declines.

Panama Petrochem (115.00) is one of India’s leading manufacturers and exporters of petroleum specialty products with an installed capacity of 69000 MTPA. For future growth company is contemplating to set up a Greenfield plant at another tax free zone like Uttarakhand or Baddi. At the same time, it has also gone for an inorganic growth and has acquired a related private company called “Mobil Petrochem”. It has even finalized the share swap ratio as one share of PPL for every two shares held in Mobil Petrochem. Although company is yet to declare it March’09 quarter nos but for nine months ending Dec’08, it has clocked whopping 70% jump in sales to Rs 299 cr but 40% increase in PAT to Rs 18.50 cr due to higher tax provisioning. Hence it has already clocked an EPS of Rs 39 till date on current equity of Rs 4.76 cr. So for the entire FY09 it may report sales of Rs 375 cr and PAT of Rs 22 cr on conservative basis i.e. EPS of Rs 46 on current equity. However the equation may change post merger from Q1FY10. In the meantime company is expected to declare 50% dividend which gives a yield of 5% at CMP.

Cosmo Films (100.00) is one of the dominant players in the Bi-axially Oriented Polypropylene Films (BOPP) market in India with a 23% market share and also one of the lowest cost producers of BOPP films in the world. It currently boast of having an installed capacity of 56000 MTPA of BOPP films, 21000 MTPA of thermal lamination films & 3000 MTPA of metallized films. Importantly, company is the only Indian player to manufacture thermal laminated films which is a high margin business. Despite demand supply mismatch, company is working at 100% capacity and is further expanding its BOPP capacity to 136000 MTPA & metalized films to 10500 in phases. It has even started a coating film with a capacity of 12000 MTPA last year. Recently company has decided to acquire a USA based company providing thermal lamination films and equipment in Europe, North America, Japan and the Pacific region. However the deal is expected to get complete by Sept 2009. Because of organized retailing, increasing mall culture and higher spending capacity, FMCG and food processing industry is witnessing phenomenal growth and hence domestic BOPP market is also growing @ 15~20 % per annum. Company has already posted an EPS of Rs 17 for nine months and is expected to declare its nos on 5th June 2009. It may end FY09 with sales of Rs 650 cr and PAT of Rs 40 cr i.e. EPS of Rs 21 on current equity of Rs 19.40 cr. It may declare 40% dividend for FY09 which gives a yield of nearly 7% at CMP.

Cera Sanitary (100.00) is one such ceramic company who is constantly churning out good nos without showing any impact of slowdown or margin pressure. Even during such slowdown period company has been able to increase its topline by healthy 20% to Rs 46 cr for the March’09 qtr and 10% rise in net profit to Rs 3.70 cr thereby posting an EPS of Rs 6 for the single quarter. Remarkably company has been able to maintain its operating margin above 20% at the time when its competitors have witnessed drastic margin erosion to keep up the sales. It is the third largest company in the organized sanitaryware segment with over 20% market share in domestic market. Moreover in the last couple of years, company has evolved itself into a total bathroom solutions provider with a wide product range for the mass as well as niche segment. To take the benefit of high demand, it has recently expanded its production capacity to 24,000 MTPA from 16,500 MTPA. To boost up its retail sales, company came up with novel idea of setting up live CERA bath studio where consumers, architectures, interior designers etc can actually see how the premium products will look, feel and function in their homes. Because of all the initiatives taken by the management company has ended FY09 with 20% growth in sales to Rs 170 cr whereas PAT has shot up whopping 30% to Rs 13 cr, despite an extra ordinary expense to the tune of Rs 1.60 cr. This works to an EPS of Rs 21 cr on current equity of Rs 3.11 having face value of Rs 5/- per share. Company has even declare 40% dividend i.e. Rs 2 per share. A gem of a company.

Vakrangee Software Ltd - Rs 65.00

Incorporated in 1990, Vakrangee Software Ltd (VSL) is a leading provider of complete document and data management solutions encompassing large-scale data capturing & management, scanning, digitization and printing. It has three business segments, viz - document management services, printing management services and IT enabled services. Over the years, VSL has emerged as the only provider of document management and printing management solutions in the organized sector. With more than 15 years of experience in servicing various government organizations, company forayed into the private sector for the first time during last year, which includes large companies from the banking and financial service, retail, power and telecom sector in both its document management and printing management vertical. Its IT enabled services comprise software development, system requirement study, tailored software development, system integration and election-related services. To meet the growing customers need in the printing management segment, VSL tied up with Eastman Kodak and has installed one large scale variable colour data printer which is the largest in Asia. Hence company boast of having the largest scanning and variable data printing capacity in India with 6 million pages per day. Presently, VSL derives 55% of total revenue from document management solutions and balance 45% from printing management solutions.

Till date, VSL has executed several prestigious projects including digitization of land records in Uttar Pradesh, managing electoral rolls for the Election Commission of India in Maharashtra, Gujarat, Rajasthan, MP and UP, delimitation exercise (redrawing boundaries of LokSabha and assembly constituencies) for Maharashtra state and handling documents in 22 offices of the Registrar of Company (RoCs) across different locations. It has also been associated with the Ministry of Corporate Affairs for the digitization of critical records under the MCA 21 project, the largest successful e-governance project in India so far. Company enjoys a pan-India footprint through 32 site offices. From 100% dependence on govt contracts, company has remarkably, within a year de-risked its business model with nearly 40% revenues now coming from private sector. It competently manages the printing of statements (monthly/quarterly/yearly), bills and mass communication collaterals of these private service providers. VSL’s service matrix includes secured data hosting in the Vakrangee Data Centre, data composition/mining from the data dump like CRM data, transaction data, billing data, design of a one-to-one communication layout and superimposing the relevant text data of each customer of the client to make an effective and efficient personalized communication statement, followed by printing the data stream so prepared in a physical format or SMS/e-mail it to the end customer. Couple of months ago only company has received the ISO 27001:2005 certification from BM TRADA certification scheme for its Information Security Management System for all process of mass level Hardcopy and Softcopy Management for Document Management Services (DMS) and printing Management Systems (PMS) business.

To maintain its growth momentum, VSL is focusing more on private sector and is constantly adding new clients to its list. Accordingly, it has entered into a strategic alliance with Eastman Kodak to offer mass customization & personalization of customer communication practices in India and has been granted with the Kodak Gold Plus accreditation status. Besdies, it is setting up a new hub office at Gurgaon with another large scale variable colour data printer followed by 100 other small offices across the country. Further, it is contemplating to open a mega global client-servicing centre at Navi Mumbai, by the end of 2010-11. Ironically, VSL is even contemplating to set up a software technology park in future. At the same time it will continue to execute government projects and Infact has recently received a Letter of Intent (LOI) from Tata Consultancy Services Ltd (TCS) for working as a build partner for 6 Pilot sites which are Bangalore (Lal Baugh), Bangalore (Sai Arcade), Mangalore, Hubli, Kirtinagar (New Delhi) and Gulbarga under the Passport Seva Kendra (PSK) Project.

On the other hand VSL is expanding its wings globally and is in the midst of forming a 100% subsidiary in Philippines. Meanwhile before incorporation, this subsidiary has already entered into a tripartite agreement with 1 Document Corporation, Philippines and IL&FS Technologies Ltd, Philippines for executing the land titling computerization project of Land Registration Authority (LRA), an administrative agency of the government of the Republic of the Philippines. This work involves grooming, scanning, digitizing, encoding and storage of about 2 cr Land Titles. The work of Grooming and scanning is to be carried out at 168 Offices of the Registry of Deeds spread across the Philipines. VSL expects the revenue of about Rs 75 cr for the subsidiary in the first year of incorporation.

Today, e-Governance is the fastest growing business opportunity as well as a major social responsibility initiative in India. It is further fuelled by the implementation of Right to Information Act (RTI) by govt of India, which makes it mandatory for all govt departments to have all the information in digital form. This includes not only conversion of historical data but also to keep present as well as future information in digital form. In view of the innumerable ministries, departments, offices at center and state level and other authorities, e-Governance has emerged as a huge opportunity for the IT industry in general and for the company in particular. On the other hand the BFSI and the telecom companies are also offering customized statements and other means of communications to retain its customers, opening up a sea of opportunity for VSL. Moreover the need for a paperless work environment across the globe enhances future prospect of the company.

Since last three years, VSL’s topline and bottomline has been growing at an impressive CAGR of 90% and 160% respectively. Moreover, company has been consistently registering an OPM of more than 40% & NPM of 20%. For the nine months ending Dec 2008 it has recorded 50% rise in topline to Rs 218 cr but only single digit growth in bottomline to Rs 34 cr due to dismissal performance during the Dec’08 quarter. Company is yet to come out with the March’09 quarter nos. Accordingly it is expected to clock a turnover of Rs 290 cr and NP of Rs 42 for full year. This translates into EPS of Rs 20 on equity of Rs 21.40 cr. For FY10 company can post much better nos on a consolidated basis. Its EV/EBIDTA stands at merely 1.2x times. Unfortunately this debt free company which generated positive cash flow of Rs 150 cr thru operating activities is today available at the same market cap of Rs 150 cr. Having a book value of Rs 127 cr, Cash EPS of more than Rs 50, dividend yield of 3%, VSL is available reasonably cheap at an EV of Rs 140 cr. Incidentally, during March’08 warrant holders (including promoters) exercised their option and got their 22.50 lakh warrants converted into shares @ Rs 241 per share despite substantial fall coupled with bearish sentiment in the stock market. Although, promoters hold only 19% and doesn’t enjoy that good reputation in the stock market still it’s a good bet at current levels. Investors are recommended to buy this scrip as it can still double even from current levels in next 12 months.

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Couple of days back Shanthi Gears (40.00) announced encouraging set of result for the March quarter. Its topline remained flat at Rs 69.50 cr but bottomline witnessed an increase of impressive 20% to Rs 14 cr despite industrial slowdown. Incidentally, company had taken an exceptional hit of nearly Rs 7 cr as interest and forex loss towards redemption of FCCB during the Dec Qtr. Hence for the entire FY09 its sales was well as profit remained almost flat at Rs 253 cr and Rs 44 cr leading to an EPS of more than Rs 5 on the equity of Rs 8.20 cr having face value as Rs 1/- per share. It has announced 120% dividend i.e. Rs 1.20 per share for FY09 which gives a yield of 3% at CMP. But most importantly, company has reported an operating margin of above 40% for FY09 due to lower raw material cost. Even for the latest March’09 quarter it clocked an OPM of 43% which is a very positive sign. However at the same time, company has informed that it is in the process of revamping and restructuring the entire operational and organisational structure which may lead to slowdown in production in all units for a short tenure. Thus H1FY10 performance may be lack luster. Despite this, investors are strongly recommended to accumulate the scrip at sharp declines as company is the second largest player in industrial gear segment with 20% market share. Of late, company has even started manufacturing gearboxes of 250 KV for windmills which has great potential.

Taking the benefit of recent notification related to AS-11 amendment, JK paper (25.00) opted to capitalize the foreign exchange loss retrospectively w.e.f. July 01, 2007. Hence purely on the account of write back of forex loss to the tune of Rs 10 cr (which it had provided in the first three quarters) company was able to post healthy net profit of Rs 15 cr for March’09 quarter. Effectively, for the entire FY09 company has clocked a turnover of Rs 1077 cr and PAT of Rs 38 cr leading to an EPS of almost Rs 5 on equity of Rs 78 cr. The most interesting aspect of the company is the high dividend payout ratio. Company has announced a dividend of 17.50% (against 15% last year) which translates into payout ratio of more than 35%. The dividend yield works to 7~8% at CMP. Operationally company is facing some pressure on margin front due to rise in raw material cost due to which its OPM for FY09 stood lower at 16.50% (against 18% last fiscal). However the margin is expected to improve in coming quarters due to softening of coal and pulp prices. With more than dozen of popular brands, company is India’s largest producer of branded papers and commands 40% market share in branded cut size papers. It is engaged in production of writing & printing paper and has recently ventured into high-end coated packaging boards. It operates two integrated plants in India with an total installed capacity of 180,000 TPA. Of late it has setup Rs 300 cr state-of-the art multi layer packaging board plant with an installed capacity of 60,000 TPA, thereby taking the total installed capacity to 240,000 TPA. Despite tempting dividend yield sell now and buy later between 18~20 levels.

For the March’09 quarter, JK Cement (80.00) has come out with excellent set of nos. Sales improved by 12% to Rs 433 cr but PBT shot up 25% to Rs 107 cr. However due to very high tax provisions in this qtr, net profit remained flat at Rs 60 cr. Remarkably, company’s operating margin for the March’09 quarter improved dramatically to above 30% due to sharp fall in power and fuel cost. Incidentally it had reported an OPM of 19%, 14% & 22% for the preceding three quarters respectively. But for the full year it reported 30% fall in PBT to Rs 234 cr and 45% decline in net profit to Rs 142 cr depisuite marginally increase in sales to Rs 1502 cr. Thus it posted an EPS of Rs 20 on current equity of Rs 70 cr and announced 35% dividend for FY09 leading to an yield of more than 4% at CMP. JK Cement is among the largest grey cement manufacturers in North India and the second largest manufacturer of white cement in the country. It boast of having 4.4 million TPA of cement manufacturing capacity along with 43MW captive power generation facilities. It is in the midst of setting of up another 3 million TPA Greenfield cement plant in Karnataka. Incase company is able to maintain the current margin for coming quarters as well, scrip may see a sharp re-rating.

J Kumar (100.00) has once again reported decent set of result for the March’09 quarter. Total revenue increased by 55% to Rs 148 cr but net profit grew by only 15% to Rs 12 cr due to declined in operating margin. Still on the full year basis it recorded 85% growth in topline to Rs 389 cr and 70% jump in bottomline to Rs 33 cr which translates into EPS of Rs 16 on equity base of Rs 20.70 cr. Last fiscal company bagged huge order from MMRDA & MSRDC to the tune of Rs 560 cr for construction of 16 skywalks in Mumbai. Recently, in last couple of months it won another Rs 130 cr order for construction of nallah & Railway Bridge (Jogeshwari) in Mumbai. In order to fund the project, company recently approved to make preferential allotment of 40 lac convertible warrants to promoters and others. Although the conversion price is yet to be finalized, it is expected to be around 70~75 Rs. Post conversion equity will get diluted by nearly 20% to Rs 24.72 cr. As the scrip has seen smart rally in short time, investors are advised to accumulate it between Rs 80~90.