Bilpower Ltd - Rs.72.00

Bilpower was established in 1989 in the name and style of Brahm Ispat Ltd. but subsequently changed its name to Bilpower to highlight its business and products comprising all types of Transformers & Electrical Laminations, Stampings and Cores. It is a major player in the electrical laminations market, which forms the core of the transformer industry. Besides it produces the largest range of transformer cores in India. Bilpower supplies its product to almost all parts of the country and enjoys the highest brand preference for superior quality and performance. Currently, the company has a huge & reputed clientele spread across 27 sates and 100 cities, which makes it the undisputed leader in the domestic market.

The Company’s strength lies in its excellent infrastructure, network and remarkable after sales service. Its manufacturing plants are equipped with the latest state-of-the-art technology and communications system backed with efficient planning. The company procures the CRGO Steel Sheets and Coils from leading manufacturers of the world and converts the same into laminations and stampings, which are the main raw materials for transformers. The company has even mastered core manufacturing, which is a very complex process and requires technical expertise and production skills. Moreover, Bilpower is concentrating more on exports and looks forward to international tie-ups to manufacture high-end CRGO stampings, laminations and Ready-to-Use Core for international players in Europe. Due to the huge demand from the power sector, the company is expanding its capacity by nearly 50% and putting up an insulated conductor unit, which would be operational in 2006.

With the government’s thrust on power and power reforms, Bilpower is expected to perform much better in coming quarters. For FY05, it reported impressive numbers. Its total sales grew by 62% to Rs.67.50 cr. whereas its NP spurted by 163% to Rs.4.50 cr. resulting in an EPS of Rs.7.5 and the company declared 10% dividend compared to 5% last year. In expectation of the phenomenal demand from the power sector and the company’s expansion plans it could earn a NP of Rs.7 cr. on a turnover of Rs.90 cr. leading to an EPS of Rs.12 on its current equity of Rs.6 cr. Investors are recommended to accumulate at every decline with a price target of Rs.100 in 12 months.