STOCK WATCH

ICSA (India) Ltd. (Code: 531524) (Rs.1060) is in the business of constructing & setting up of power transmission lines and substations. It also provides embedded technology for the power sector to identify Transmission & Distribution (T&D) losses and monitor power consumption using the GSM Network. It has successfully deployed its power sector products like Substation Controllers, Distribution Transformer Controllers, and Automatic Meter Reading Systems etc. Apart from the power sector, its Remote Monitoring applications are utilized by other sectors including oil, gas, mining, irrigation, transport and water utilities etc. For FY07, it may report sales of Rs.330 cr. with net profit of Rs.65 cr., which can shoot upto Rs.500 cr. and Rs.100 cr. respectively for FY08. On its current equity of Rs.6.60 cr. the FY07 EPS works out to around Rs.100. Recently, the company raised around Rs.100 cr. through the FCCB route and has also issued 7.5 lakh warrants at Rs.1135 to promoters and Goldman Sachs. Hence on its diluted equity of around Rs.8.50 cr. its FY08 EPS works out to Rs.118. However, the company is planning to raise another Rs.100 cr. through ADR/GDR or any other route to fund its future growth plans.

Honda Siel Power Products Ltd. (Code: 522064) (Rs.172) is engaged in manufacturing and marketing of portable generator sets, portable engines, internal combustion engines, pumping sets, water pumps, lawnmowers, spare parts and other related products in India. Being a 67% subsidiary of Honda Motor Co. Japan, the company is the undisputed leader in the field of portable generators with more than 70% market share. For FY07, it is expected to report net sales of Rs.225 cr. with net profit of Rs.15.50 cr. i.e. an EPS of Rs.15 on its equity of Rs.10 cr. Notably due to various indigenisation plans, the company has reduced its import cost from 35% to 20% as a percentage of material cost earlier. Its profit margin has accordingly considerably and is expected to rise further for FY08. It may clock a turnover of Rs.260 cr. and PAT of Rs.20 cr. i.e. EPS of Rs.20 for FY08. A safe bet.

Manugraph India Ltd. (Code: 505324) (Rs.172) is the largest manufacturer of web offset and sheet-fed offset presses. With a whopping 70% market share, its presses are present in almost all-major publication houses, in India. Besides, it has worldwide presence from Latin America to Europe and from the Middle East to China. Recently, it has acquired Dauphin Graphic Machines Inc., a leading manufacturer of web offset printing machines based in Pennsylvania, USA for $19.20 mn. With this acquisition, it will become the world largest single width press manufacturing company. It is expected to end FY07 with sales of Rs.375 cr. with net profit of Rs.50-52 cr. i.e. EPS of Rs.17 on its equity of Rs.6 cr. having FV of Rs.2 per share. However, due to the recent acquisition its consolidated numbers will double and it can register a consolidated turnover of Rs.750 cr. for FY08. There is also good interest from institutional investors as FIs hold around 8% whereas domestic MFs hold 4% as on December 2006 and HDFC MF and Reliance MF have also bought good quantity from open market in the range of Rs.185-200 in the last two months. A solid bet for the long-term.

TIL Ltd. (Code: 505196) (Rs.191) is India's leading provider of technology intensive, application specific heavy engineering equipment for use in core infrastructure sectors. Its business is primarily dividend into three segments namely material handling (25%), construction equipment (50%) and power system (25%). Its product profile consist of Mobile Cranes, Forklift Trucks, Hydraulic Excavators, skid steer loaders, off highways trucks & Dumpers, Industrial generator sets, diesel engines and various other material handling and earth moving equipments. On a standalone basis, it may end FY07 with sales of Rs.550 cr. and profit of Rs.17 cr., which will result in an EPS of Rs.17 on its current equity of Rs.9.70 cr. To meet the increasing demand, the company is planning to increase its capacity for material handling equipment like mobile cranes etc. Accordingly for FY08, it can clock a turnover of Rs.625 cr. with net profit of Rs.21 cr. i.e. EPS of Rs.22. On a consolidated basis, it works out to an EPS of Rs.25-26. At a reasonable discounting by 12 times, the share price can touch Rs.300 in 9-12 months. A good bet in the engineering sector.