International Combustion - Rs.320.00

In 1936, International Combustion Ltd (ICL) commenced operations in Calcutta as a trading house representing the interests of International Combustion, U.K. In 1974, this FERA company changed its status from a private limited to public limited company. But in 1990, the foreign promoters sold their stake to the NRI Directors. It has foreign technical collaborations and licensing agreements with world leaders in the respective product groups for manufacture of premium equipment. Besides, its strong marketing and service organization across the country enables quick and direct contact with customers during all phases of consultation, contractual negotiation, followed by execution and after sales service. It has a large clientele with major players from across all industries including metal, mining, chemical, pharma, construction, sugar, cement, power, textile, paper, fertilizer, plastic etc. ICL has fully equipped manufacturing facilities at Calcutta, Nagpur and Aurangabad which ensures total control over production and product quality. Presently, ICL has following three manufacturing division:-

Heavy Engineering Division :
With technical knowhow from Carl Schenck ZchBehenck AG of Germany, ICL manufactures and markets a wide range of mechanical and electro-magnetic vibrating screens, feeders & conveyors to handle all types of bulk solids, whether large lumps or very fine grains, whether wet or dry, whether abrasive such as scrap, flux and sinter. Under bulk material handling, the company deals in Spiralling Belt Elevators, Scooping Belt Conveyers, Girdle Pocket Elevators, Apron Feeder, Mining Haulages etc. As accessories it manufactures Exciters, DC Brake Unit & Monitoring System for vibrating machines. ICL also manufactures multi-deck sizers, bar sizers, vibro bar sizers, flip flop screens in technical collaboration with Mogensen GmbH, Germany. ICL also has a Grinding, Classification & Drying unit under which it markets ‘Raymond” American brand roller mill, pulverisers, grinding mills, mechanical air separators and flash drying system, which can reduce many products by 95~98% or refine them below 10 microns. The company has also entered into a licence agreement with Ecutec, Spain to manufacture Microfine Classifiers from this year.

Polymer Division :
With technology from Gummi Kuper GmbH, Germany, ICL produces various Polyurethane and Rubber Screen Decks and Liners for wet and dry applications including scalping, load relieving, sizing, washing and dewatering in this division. The operation in this unit was suspended for some time and has resumed from this fiscal to manufacture modular screen decks.

Bauer Division :
Under license from Danfoss Bauer, Germany, ICL offers a comprehensive range of Geared Motors, Gear Boxes and Electric Motors manufactured on specially designed inter-linked CNC production lines. Major growth is expected is this segment as the company has introduced Bauer current generation B-2000 series, in India and neighbouring countries. These equipments have strong global presence in Steel, Automobiles, Beverages, Material Handling Systems and various other industries.

With strong industrial growth and major expansions by manufacturing biggies and in the construction sector, ICL has a very promising future ahead. Moreover, it is eyeing major business from exports by tapping newer markets in Europe and South America apart from supplying to Kazakhstan and some countries in South East Asia. It is also enhancing its production capacity at Aurangabad and Nagpur with a capital investment of Rs.5 cr. for which it has made a preferential allotment of 2,30,000 warrants @ Rs.178 to the promoters. For FY06, it is estimated to clock a turnover of Rs.65 cr. and NP of Rs.5.50 cr. For FY07, Sales may rise to Rs.85 cr. and NP to Rs.7 cr. This works to an EPS of Rs.23 and Rs.29 respectively on its diluted equity of Rs.2.40 cr. With a reasonable forward discounting of 14~18 PE, the scrip has the potential to trade between Rs.400-Rs.500. A solid buy.