STOCK WATCH

Numeric Power (450.00) is India’s No 1 manufacturer of uninterrupted power supply (UPS) systems, stabilizers and power conditioners. It also undertakes turnkey projects and offers end to end solution for SCADA/EMS package, large network of industrial process, power transmission support systems and distribution management. For the June qtr its sales increased by 30% to 76 cr but the NP shot up 75% to 8.90 cr on back of higher other income thereby posting an highest ever EPS of 18 Rs for the quarter. Last year, company entered into a joint venture with the French UPS major SOCOMEC SA to distribute, market and service the 3 phase range of UPS systems (greater than 10 KVA) products to customers in India. Ironically, around 75% of the ATMs in the country are fitted with UPS supplied by the company. With India's significant power deficits and the ubiquitous outages and voltage fluctuations; company’s products still have significant market potential in the country. For FY08 it may report sales of 325 cr and profit of 24 cr i.e. EPS of 48 Rs on equity of 5.05 cr. Buy at declines

Apart from being one of the lowest cost manufacturer, TNPL (101.00) is also having the world’s largest bagasse based paper mill with a capacity of 2,30,000 TPA. It is also the largest exporter of wood free paper from India. To cater the increasing paper demand and become a global player, company has implemented Phase-I of Mill Development Plan envisaging increase in captive pulp production capacity from 170,000 TPA to 260,000 TPA with element chlorine free (ECF) bleaching at a capital outlay of Rs 565 Crore. This will also increase the paper production capacity by 15,000 tonnes to 245,000 TPA and is expected to become operational from Oct 2007. It has further plans to take it to 4,00,000 TPA by Sept 2009. As power is one of the major cost components, company has made the mill self-sufficient by having in-house captive power generation capacity of 61.12 MW and another 35.50 MW thru wind farm. Moreover it has plans to establish a mini cement plant with a capacity of 400 tpd and is also contemplating to construct an IT Park measuring an office area of 4 lakhs sq. ft. on its surplus land. With an expected turnover of 1000 cr and NP of 110 cr i.e. EPS of 16 Rs, company is a value buy at current market cap of 700 cr.

Sukhjit Starch (150.00) is mainly engaged in manufacturing edible and non edible maize starch, dextrine, liquid glucose and dextrose monohydrate. Besides, it also produces sorbitol, maize oil, maize gluten, maize husk, high maltose syrup, oxidized/pregelatinized starch etc. It has an impressive clientele including corporates like Britannia, Dabur, Colgate, HLL, Heinz, Ballarpur, Berger paints, JCT, Mahavir Spinning, Wockhard etc. It is the only multi-locational group in India as of now with a combined installed capacity of 1,50,000 tons corn grind per annum. Couple of months back only company has started commercial production at its new unit in HP which has enhanced the capacity by nearly 25% and is dedicated for high margin starch and derivative products especially for pharmaceutical industry taking shape in Baddi, Himachal Pradesh. It reported satisfactory nos for the June quarter and accordingly may clock a turnover of 210 cr and PAT of 25 cr for FY08. This works out to an EPS of 34 Rs on current equity of 7.40 cr. Scrip has the potential to cross 200 mark in medium term

SEAMEC Ltd (218.00) operates multi-purpose support vessels (MSV) for diving and provides underwater/subsea engineering and construction, maintenance, inspection of under-water structures, rescue-operations and fire-fighting and other support services for offshore oil/gas installations located in India or abroad. Hence it is a pure play of charter hiring of MSVs, which are more specialized vessels than Offshore Supply Vessels (OSV) as they are equipped with Dynamic Positioning (DP) system and can go underwater for repair & maintenances of underwater pipelines. Ironically, there are only 6 MSV in India, out of which four belongs to SEAMEC and the rest two are with ONGC. However, as two of the company’s MSV are under dry dock its FY07 performance will be lack luster. But after that, it is estimated to report bumper results also due deployment of its fourth vessel. Hence, for financial year ending Dec 2008, it is expected to register a topline of 250 cr and bottomline of 80 cr which means an EPS Rs.24 on its equity of 33.90 cr. Being a subsidiary of Technip S.A of France, the largest oilfield engineering, construction and service group in Europe and being a debt free company it deserve much better valuation. Accumulate at declines.