Lakshmi Electricals- 250.00 Rs
Incorporated in 1981 and belonging to the high profile LMW group, Lakshmi Electrical Control System Ltd (LECSL) is primarily engaged in manufacturing of electric and plastic components. Under the electric component division which contributes nearly 80% of revenue, it makes switchgear and control panel such as contactors, thermal overload relays, control relays, electrical control panels etc. Other electrical components include motor starters and motor control panels. It also provides customized control panels for original equipment manufacturers. All of these products are used in industrial applications for power supply and also find application in commercial and residential buildings. Balance 20% of revenue comes from industrial plastic component division which actually supports the manufacture of electrical mountings and components for switchgears. Besides it manufactures textile machinery components using engineering plastics mainly to cater the demand from Lakshmi Machine Works.
LECSL’s manufacturing facility is located at Arasur, Coimbatore and has a technical collaboration with Sprecher & Schuh, Switzerland, one of the leading manufacturers of low-tension switchgear items in the world. Last year, 4 sophisticated Engel [Austria] injection-moulding machines were installed as a part of the modernization program. Off late company has developed additional products like Automatic Power Factor Control Panel (APFC) and Limit Switches with many variants for wide range of applications, as also Solenoid Valves in defined executions. As a part of product diversification, its R&D division has developed a novel system for the feeding of raw material to the plastics processing machinery, under the trade name 'NeumaFeed'. A provisional patent application has also been filed. The other product range is 'LECS Robots' for use in conjunction with plastic injection moulding machines, capable of multiple functions. Moreover new products like 4 pole contactors up to 120 A, Autoswitch, ATS Controller etc have been introduced. Company has also installed 1.25 MW wind power plant for tax benefits.
Importantly, LECSL has a wholly owned profit making subsidiary called Harshini Textiles, which is into manufacturing of yarn and has a factory in Coimbatore with an installed capacity of 25200 spindles. It is in the midst of expansion to double its capacity to 50400 spindles. Besides, LECSL also owns 88,800 shares of Lakshmi Machine Works Ltd which at the CMP of 2650/- works out to whopping 23.50 cr. Whereas the whole market cap of LECSL is merely 60 cr. Company is coming out with its result on 31st May and it may end FY07 with sales of 68 cr and NP of 7.75 cr. Due to very tiny equity of 2.46 cr this translates into EPS of 32 Rs on a standalone basis and on a consolidated basis it can report 42 Rs EPS. Considering the rising demand of switchgear and control panels for the power and industrial applications, company is estimated to report sales of 80 cr and profit 9.25 for FY08 ie EPS of 38 Rs on standalone basis and 50 Rs including Harshini Textile earnings. Investors are strongly recommended to buy at current levels as share price can double in 15~18 months.
LECSL’s manufacturing facility is located at Arasur, Coimbatore and has a technical collaboration with Sprecher & Schuh, Switzerland, one of the leading manufacturers of low-tension switchgear items in the world. Last year, 4 sophisticated Engel [Austria] injection-moulding machines were installed as a part of the modernization program. Off late company has developed additional products like Automatic Power Factor Control Panel (APFC) and Limit Switches with many variants for wide range of applications, as also Solenoid Valves in defined executions. As a part of product diversification, its R&D division has developed a novel system for the feeding of raw material to the plastics processing machinery, under the trade name 'NeumaFeed'. A provisional patent application has also been filed. The other product range is 'LECS Robots' for use in conjunction with plastic injection moulding machines, capable of multiple functions. Moreover new products like 4 pole contactors up to 120 A, Autoswitch, ATS Controller etc have been introduced. Company has also installed 1.25 MW wind power plant for tax benefits.
Importantly, LECSL has a wholly owned profit making subsidiary called Harshini Textiles, which is into manufacturing of yarn and has a factory in Coimbatore with an installed capacity of 25200 spindles. It is in the midst of expansion to double its capacity to 50400 spindles. Besides, LECSL also owns 88,800 shares of Lakshmi Machine Works Ltd which at the CMP of 2650/- works out to whopping 23.50 cr. Whereas the whole market cap of LECSL is merely 60 cr. Company is coming out with its result on 31st May and it may end FY07 with sales of 68 cr and NP of 7.75 cr. Due to very tiny equity of 2.46 cr this translates into EPS of 32 Rs on a standalone basis and on a consolidated basis it can report 42 Rs EPS. Considering the rising demand of switchgear and control panels for the power and industrial applications, company is estimated to report sales of 80 cr and profit 9.25 for FY08 ie EPS of 38 Rs on standalone basis and 50 Rs including Harshini Textile earnings. Investors are strongly recommended to buy at current levels as share price can double in 15~18 months.
No comments:
Post a Comment