STOCK WATCH
GIPCL (Code No: 517300) (Rs.70) which recently completed its IPO at Rs.68 came out with impressive numbers for Dec’05 qtr. Its topline was marginally down to Rs.195 cr. but its NP increased by 28% to Rs.30 cr. in spite of lower other income. For the full year FY06, it can report a NP of Rs.125 cr. i.e. an EPS of Rs.8 on its expanded equity of Rs.151.25 cr. The company is in the process of doubling its capacity at Surat Lignite Power plant (SLPP) to 500 MW from 250 MW and is also working on setting up two 1000 MW project in South Gujarat besides diversifying into power distribution in the State as part of its expansion plans. Leading mutual funds have evinced interest in this company and will gradually increase their stake going forward. A good long term bet in the power sector with a minimal downfall from current levels.
Ramsarup Industries (Code No: 532690) (Rs.80) is a leading manufacturer of TMT bars and steel wires which are mainly supplied to the power sector. For Dec.’05 qtr. its sales grew by 18% to Rs.247 cr. whereas its NP jumped 72% to Rs.8.20 cr. due to better operating efficiency and declared an interim dividend of 10%. For the full year FY06, it may report a NP of Rs.30 cr., which works out to an EPS of Rs.17 on its equity of Rs.17.50 cr. The company is expanding its product portfolio by setting up a structural mill with an installed capacity of 1,35,000 TPA at Shyamnagar in West Bengal at a cost of around Rs.70 cr. Besides it is planning to enter the power transmission and distribution business in the near future. Scrip has the potential to rise 50% in 9~12 months.
Shrachi Infrastructure (Code No: 511591) (Rs.50) offers a wide range of financial products and services from financing passenger cars and light commercial vehicles to heavy commercial vehicles and construction equipment. For rapid growth, the company is concentrating on infrastructure funding operation since it has a huge potential. For the full year FY06, it may report a bottomline of Rs.9.50 cr. leading to an EPS of Rs.11 on its current equity of Rs.8.50 cr. Recently, it allotted 19 lakh warrants to promoters @ Rs.53 per share and intends to raise further capital to fund its expansion plans while there is a risk of equity dilution going forward, its results are expected on 31st Jan. and we may see some firework in the short term.
Ramsarup Industries (Code No: 532690) (Rs.80) is a leading manufacturer of TMT bars and steel wires which are mainly supplied to the power sector. For Dec.’05 qtr. its sales grew by 18% to Rs.247 cr. whereas its NP jumped 72% to Rs.8.20 cr. due to better operating efficiency and declared an interim dividend of 10%. For the full year FY06, it may report a NP of Rs.30 cr., which works out to an EPS of Rs.17 on its equity of Rs.17.50 cr. The company is expanding its product portfolio by setting up a structural mill with an installed capacity of 1,35,000 TPA at Shyamnagar in West Bengal at a cost of around Rs.70 cr. Besides it is planning to enter the power transmission and distribution business in the near future. Scrip has the potential to rise 50% in 9~12 months.
Shrachi Infrastructure (Code No: 511591) (Rs.50) offers a wide range of financial products and services from financing passenger cars and light commercial vehicles to heavy commercial vehicles and construction equipment. For rapid growth, the company is concentrating on infrastructure funding operation since it has a huge potential. For the full year FY06, it may report a bottomline of Rs.9.50 cr. leading to an EPS of Rs.11 on its current equity of Rs.8.50 cr. Recently, it allotted 19 lakh warrants to promoters @ Rs.53 per share and intends to raise further capital to fund its expansion plans while there is a risk of equity dilution going forward, its results are expected on 31st Jan. and we may see some firework in the short term.
Bombay Oxygen (Code No: 509470) (Rs.4933) is engaged in business of industrial gas and produces various types of gases like gaseous and liquid oxygen, liquid nitrogen, liquid argon etc. For Dec’05 qtr. sales were up 19% at Rs.12 cr. but its NP zoomed 53% to Rs.3.20 cr. For full year FY06, it may report Sales of more than Rs.50 cr. and NP of around Rs.12.00 cr. This works to an EPS of whopping Rs.800 on its tiny equity of Rs.1.50 cr. and share having a face value of Rs.100. Its book value as on 31st March’05 is Rs.1700 which may shoot up to Rs.2400 by 31st March 06. This means that the management may anytime announce a stock split and liberal bonus which will take the stock to dizzy height. Its 52-week high is Rs.6826 i.e. 30% lower than its recent high. Since promoters hold 59% of the stake the scrip is bound to hit continuous circuit filters in the near future. Catch it if you can.
Though most cement scrips are busy hitting new highs, Mangalam Cement (Code No: 502157) (Rs.91) is still bit far from its recent high of Rs.101 and trading reasonably cheap due to constant selling by financial institutions like IDBI. It began its new fiscal with excellent numbers. For Dec’05 qtr. Sales spurted 42% to Rs.86 cr. and NP stood at Rs.7.20 cr. compared to 0.61 cr. Its Operating Margin also improved to 14% against 10% last year. For FY06, it is estimated to earn a profit of Rs.25 cr. i.e. an EPS of Rs.9 on its current equity of Rs.28.20 cr. For FY07, it can report an EPS of Rs.12. Ironically; in the last 2 qtrs. IDBI sold a whopping 10% of its equity in the open market and has brought down its stake to 4%. Not much selling pressure is expected now and the scrip is poised to hit a new high soon.
In spite of being considered defensive sector, pharma has been ignored and that too when markets are trading so high. Ind Swift Labs (Code No: 532305) (Rs.158) announced decent numbers last week. Its turnover has increased by 23% to Rs.82 cr. whereas its profit increased 21% to Rs.9.10 cr. In its effort to tap the regulated markets, the company has filed 6 DMFs in USA and targets to file 4~5 DMFs every year. It has also filed 13 patents for non-infringing process for its APIs in USA & India and has put to commercial launch, 4 new APIs during the quarter. Besides, lot of other positive development and massive expansion is on which lead to a sharp re-rating of the company going forward. Although promoters stake is 26%, FIIs hold 30% and MFs hold nearly 4% stake. For FY06, company is expected to report topline of Rs.330 cr. and bottomline of Rs.37 cr. i.e. EPS of Rs.18 on its equity of Rs.20.90 cr. Even at a reasonable PE of 12x, the scrip is bound to cross Rs.220 in the short to medium term.
Though most cement scrips are busy hitting new highs, Mangalam Cement (Code No: 502157) (Rs.91) is still bit far from its recent high of Rs.101 and trading reasonably cheap due to constant selling by financial institutions like IDBI. It began its new fiscal with excellent numbers. For Dec’05 qtr. Sales spurted 42% to Rs.86 cr. and NP stood at Rs.7.20 cr. compared to 0.61 cr. Its Operating Margin also improved to 14% against 10% last year. For FY06, it is estimated to earn a profit of Rs.25 cr. i.e. an EPS of Rs.9 on its current equity of Rs.28.20 cr. For FY07, it can report an EPS of Rs.12. Ironically; in the last 2 qtrs. IDBI sold a whopping 10% of its equity in the open market and has brought down its stake to 4%. Not much selling pressure is expected now and the scrip is poised to hit a new high soon.
In spite of being considered defensive sector, pharma has been ignored and that too when markets are trading so high. Ind Swift Labs (Code No: 532305) (Rs.158) announced decent numbers last week. Its turnover has increased by 23% to Rs.82 cr. whereas its profit increased 21% to Rs.9.10 cr. In its effort to tap the regulated markets, the company has filed 6 DMFs in USA and targets to file 4~5 DMFs every year. It has also filed 13 patents for non-infringing process for its APIs in USA & India and has put to commercial launch, 4 new APIs during the quarter. Besides, lot of other positive development and massive expansion is on which lead to a sharp re-rating of the company going forward. Although promoters stake is 26%, FIIs hold 30% and MFs hold nearly 4% stake. For FY06, company is expected to report topline of Rs.330 cr. and bottomline of Rs.37 cr. i.e. EPS of Rs.18 on its equity of Rs.20.90 cr. Even at a reasonable PE of 12x, the scrip is bound to cross Rs.220 in the short to medium term.
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