JaiHind Projects - Rs.36.00

Established in 1963, Jaihind Projects Ltd (JPL) was originally formed as small metals and welding workshop in Rajkot in the name Jaihind Welding Works by the late Mr. Lalchand Hinduja. Since then, it has grown into globally competitive engineering and construction company serving the oil & gas, steel, water supply and power industries and has executed some of the longest pipeline projects in the country. Company’s USP lies in its huge fleet of more than 1500 equipments with 70 different machineries. JPL has a central equipment maintenance and repair workshop and storage facilities in Ahmedabad and uses sophisticated asset maintenance, repair and operations software solutions to manage its workshop and fleet of equipment to ensure reliability. Besides, it is committed to implementation, documentation and maintenance of a quality system to meet the requirements of ISO 9001:2000. Importantly, JPL has a very strong track record of executing the most demanding projects in the allotted time frame and completion ahead of schedule. JPL activities can be divided under 4 major heads:

1. Pipeline Laying: Cross country pipeline laying is the prime area of operations for the company. With over 2500 kms of cross country pipelines and over 1500 kms of plant piping constructed for oil & gas, water, effluent industries. It has laid pipelines from 4” to 56” in diameter and has covered onshore, near shore and offshore through different terrains ranging from rocky to desert and snowy to marshy
2. Corrosion Protection: Corrosion Protection Services include the use and application of modern cathodic protection techniques, protective coating materials including internal tank linings, pipeline coatings, water treatment chemicals, general corrosion inhibitors and a wide variety of chemicals & applications.
3. Engineering Turnkey Projects: This involves project conceptualization to commissioning, which interalia includes survey, investigation & designing, fabrication work, foundation, erection and commissioning work.
4. Urban Infrastructure: The various projects JPL has undertaken in this industry segment comprise of turnkey execution of intake wells, approach RCC bridges, Pump-houses, Pumping machineries, Treatment Plants, Reservoirs, Sumps, Buildings, Roads, Substations, Instrumentation, Transmission, Rising, Gravity Mains and Gas distribution networks.

For FY06, company is estimated to report total revenue of Rs.50 cr. and PAT of Rs.1.20 cr. which may shoot up to Rs.70 cr. and Rs.2 cr. for FY07. This works out to an EPS of Rs.2 and Rs.4 respectively on its small equity of Rs.5.11 cr. The reason for this engineering company commanding a market cap of only Rs.18 cr., is that it was traded in physical form earlier. But now it is available in demat form and is being accumulated by known circle. Hence investors are recommended to but at CMP with a price target of Rs.70 (100% appreciation) in 12~15 months.