Numeric Power System Ltd - Rs 135.00
Incorporated in 1995, Numeric Power System Ltd (NPSL) is a leading manufacturer of uninterrupted power supply (UPS) systems, stabilizers and power conditioners in India. Infact, it has been the undisputed leader for online, offline/interactive UPS in India for more than a decade. Ranging from 0.5 KVA to 4800 KVA, company offers the total range of 1 Phase and 3 Phase UPS systems that are built with advanced technology and state-of-the-art features suitable for unitary and parallel redundant configurations addressing a wider band of the industry from PCs, servers, banks, data centers, healthcare and large IT network protection. Ironically, NPSL has been ranked as No.1 Online UPS manufacturer, power Electronic company of the year for the last 15 years all in a row by the Softdisk journal. It has also been ranked as No 1 offline UPS manufacturer for second consecutive year by the same magazine. Apart from products, it also executes turnkey projects and offers end to end solution for SCADA/EMS package, large network of industrial process, power transmission support systems and distribution management. It even undertakes electrical power quality Audits and system Design. It also provides services such as annual maintenance contracts of UPS and power conditioners of not only its own brands but also for other brands. Panasonic Japan has appointed NPSL as the national distributor for their SLA batteries. NSPL has been appointed as the national distributor for Panasonic brand of SLA batteries. NPSL has been regularly exporting its products to Canada, UK, China, South America, Singapore, Vietnam, Mauritius, Dubai, South Africa, Nigeria, Kenya, Ethopia, Uganda etc. Incidentally, NPSL is a national distributor for a range of ‘Panasonic’ brand of sealed lead acid batteries.
NPSL has eight world class manufacturing facilities spread across Pondichery-TN, Chennai-TN, Parvanoo-HP and Colombo-Srilanka, thereby emerging as the biggest integrated manufacture of UPS in India. The company's fully-owned subsidiary in Sri Lanka, Singapore, Mauritius and an export-processing unit in Chennai cater to the overseas markets. In India, it has a strong distribution network through 1800 channel partners spread across 400 towns. This is backed by 214 sales and service location apart from specialized 27 test and repair centre along with exclusive helpdesk which works 24x7. It has an enviable and high profile clientele including Infosys, Siemens, Intel, Philips, Microsoft, Veritas, HDFC, Citibank, ICICI, RBI, NIC, Reliance, ABB, BMW, NCR, Nokia, major stock exchanges etc. As per rough estimates, around 75% of the ATMs in the country are fitted with UPS supplied by NPSL. Last fiscal, the company implemented an auxiliary power systems project for Power Grid Corporation in the entire north-eastern States, in a turnkey effort involving design, supply and installation of total power conditioning systems. To become more efficient, NPSL is backward integrating into batteries and is scouting for a technology partner to set up a battery manufacturing unit. Interestingly, it has also ventured into the Solar power area and started implementing projects in a commendable way for energy generation using Photo Voltaic Modules. Currently it has already gained expertise in Solar Hybrid UPS Systems, Stand alone and Distributed Mini Grid Systems & Grid Connected Solar Power Farms. Remarkably, company has already accumulated more than 70 clients for solar power division. However during April 2008, NSPL walked out of its two year old JV with SOCOMEC SA of France as it primarily prevented the company to tap the solar 3 phase UPS products. But at the same time company has developed its own products in higher range of 3 phase category which are now fairly successful in the market. For future growth NPSL has adapted the latest power conversion techniques combined with advanced digital controls in the newly designed ‘NUMERIC DIGITAL HPX’ series in addition to the HP and HPE models. This new version HPX series is designed to primarily address IT and Industrial requirements including intelligent monitoring using Internet.
With more and more businesses running on technology solutions, the need for power protection systems for reliability and quality has become vital. Given India's significant power deficits and the ubiquitous outages and voltage fluctuations; NPSL’s products have significant market potential in the country. For FY08 it recorded impressive 40% increase in sales to Rs 387 cr where NP more than doubled to Rs 40 cr thereby posting a very healthy EPS of Rs 80 on equity of Rs 5 cr. But due to general economic condition and higher raw material cost its operating has fallen to 9.5% in the current year against 13% last fiscal. Thus for the nine months ending Dec 2008 NSPL’s sales increased marginally to Rs 296 cr but PAT declined by 20% to Rs 23 cr. This is despite the fact that company earned an extraordinary income of Rs 5 cr on sale of its stake in JV company. Hence it may end the current year with a topline of Rs 400 and bottomline of Rs 25 cr (incl. extraordinary item) i.e. EPS of Rs 50 on current equity. But considering all the factors, company has the potential to clock a turnover of Rs 450~475 cr and NP of Rs 35 cr i.e. EPS of Rs 70 for FY10. At a modest discounting by 5x times against its FY10 earnings, scrip can shoot up Rs 350 in 15~18 months. Apart from having very low debt on its books, it has huge reserves to the tune of Rs 135 cr on such a tiny equity making it a strong bonus candidate.
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