Accurate Transformers Ltd. (Code: 530513) (Rs.86.50) is engaged in manufacturing of power and distribution transformers ranging from 1 MVA to 160 MVA - in up to 220 KV class. It also carries out rural electrification project, which involve electrification in remote areas including the laying of lines, poles and substations. Unfortunately, despite having installed capacity of more than 8000 MVA, the company is working at very low capacity utilization of less than 50% due to mounting debtors and shortage of funds. However, on the back of the ongoing boom in the power sector and the robust demand for transformers, the situation has improved considerably. Due to better operating efficiency and higher realization, the company is expected to improve its profit margin going forward. It may even grow at CAGR of 50% over the next three years as far as its bottomline is concerned. On a conservative basis, it can clock a turnover of more than Rs.200 cr. with PAT of Rs.8 cr. for FY08. This works out to an EPS of Rs.27 on its current equity of Rs.2.96 cr. As perunconfirmed reports, SEBI has stalled its preferential issue of 31 lakh warrants at Rs.56 and it may have to go in for fresh fund raising programme as per SEBI guidelines. The scrip has reduced to nearly one third from its high of Rs.240. A screaming buy.
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Spanco Telesystems & Solutions Ltd. (Code: 508976) (Rs.165) offers core competency telecom systems integration, which includes implementation of multi-location, multi-services converged networks for carrying diverse multimedia traffic (voice, data & video) based on latest technologies like ATM, MPLS, Frame Relay, TCP/IP etc. On the other hand, it has bagged a 10-year contract to set up, operate and maintain Interactive Voice Response System (IVRS) and Regional Call Centres (RCC) for the Indian Railways in a joint venture with the Spice Group. Moreover, it has ventured into the RFID space by acquiring 51% stake in Skandsoft Technologies - a pioneering software solutions company, which is dedicated to revolutionize the upcoming world of automated business processes through technologies like Radio Frequency Identification (RFID) & Automatic Identification and Data Capture systems (AIDC). It has even formed a joint venture ‘Spanco-GKS’ with Golden Key Solutions of Oman to replicate its Indian business in the Gulf region as well. For FY08, it may clock a turnover of Rs.625 cr. with profit of around Rs.48 cr. on a standalone basis i.e. an EPS of Rs.23 on its current equity of Rs.20.65 cr. A solid bet.
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Spanco Telesystems & Solutions Ltd. (Code: 508976) (Rs.165) offers core competency telecom systems integration, which includes implementation of multi-location, multi-services converged networks for carrying diverse multimedia traffic (voice, data & video) based on latest technologies like ATM, MPLS, Frame Relay, TCP/IP etc. On the other hand, it has bagged a 10-year contract to set up, operate and maintain Interactive Voice Response System (IVRS) and Regional Call Centres (RCC) for the Indian Railways in a joint venture with the Spice Group. Moreover, it has ventured into the RFID space by acquiring 51% stake in Skandsoft Technologies - a pioneering software solutions company, which is dedicated to revolutionize the upcoming world of automated business processes through technologies like Radio Frequency Identification (RFID) & Automatic Identification and Data Capture systems (AIDC). It has even formed a joint venture ‘Spanco-GKS’ with Golden Key Solutions of Oman to replicate its Indian business in the Gulf region as well. For FY08, it may clock a turnover of Rs.625 cr. with profit of around Rs.48 cr. on a standalone basis i.e. an EPS of Rs.23 on its current equity of Rs.20.65 cr. A solid bet.
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ANG Auto Ltd. (Code: 530721) (Rs.94.45) is among the few companies in the world to be completely integrated – from the manufacture of components to sub-assemblies and assemblies and finally to vehicles. Today, it is the largest trailer manufacturing company in India with a capacity of 3600 trailers per year and will soon be No. 1 in Asia as it is augmenting the capacity to 6000 trailers. Notably, the company has entered into a 5-year contract with Ashok Leyland for trailers, which is valued at Rs.1500-1800 cr. Secondly, its patented automatic stack adjuster and the single piece dummy axle is witnessing strong demand from all over the world. Going ahead, it intends to manufacture suspension systems and is also setting up a forging unit at Bhiwadi, Rajasthan, at capex of Rs.37 cr. To consolidate its operations, the company has merged ANG Auto Tech, its 75% subsidiary with itself. On a standalone basis, it is expected to clock a turnover of Rs.120 cr. and profit of Rs.16 cr. for FY08 i.e. an EPS of Rs.13.50 on its current equity of Rs.11.90 cr. Since the conversion price is high at Rs.325, its FCCB of Rs.50 cr. may not get converted into equity. Moreover, finding its valuation very cheap, the management has obtained the approval to buy back equity shares up to 24.30% of the total paid-up equity capital at a maximum price of Rs.215 per share. A golden opportunity to buy at such low price levels.
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Part of the B. M. Thapar Group, Greaves Cotton Ltd. (Code: 501455) (Rs.192.50) is engaged in the production of diesel/petrol/LPG engines for power generation, agro equipment and automotives apart from manufacturing gensets, agro equipment and construction equipment Besides, it is also engaged in marketing high technology systems for marine, aviation and electronic applications. Last year, to enhance its presence in the global market, it acquired Bukh Farymann Diesel GmbH (renamed as Greaves Farymann Diesel GmbH), which is engaged in the manufacture and marketing of single cylinder diesel engines and parts for Rs.25 cr. For FY08, it may clock a turnover of Rs.1400 cr. with PAT of Rs.115 cr. i.e. an EPS of Rs.24 on its current equity of Rs.48.80 cr. More importantly, few weeks back Piaggio Group's Indian subsidiary signed an 8 year agreement with the company for purchase of mono-cylinder diesel engines for application on the three-wheeled vehicles manufactured by it. This implies that the company will continue to be a single source supplier of such mono-cylinder diesel engines to Piaggio. A solid bet for long-term.
ANG Auto Ltd. (Code: 530721) (Rs.94.45) is among the few companies in the world to be completely integrated – from the manufacture of components to sub-assemblies and assemblies and finally to vehicles. Today, it is the largest trailer manufacturing company in India with a capacity of 3600 trailers per year and will soon be No. 1 in Asia as it is augmenting the capacity to 6000 trailers. Notably, the company has entered into a 5-year contract with Ashok Leyland for trailers, which is valued at Rs.1500-1800 cr. Secondly, its patented automatic stack adjuster and the single piece dummy axle is witnessing strong demand from all over the world. Going ahead, it intends to manufacture suspension systems and is also setting up a forging unit at Bhiwadi, Rajasthan, at capex of Rs.37 cr. To consolidate its operations, the company has merged ANG Auto Tech, its 75% subsidiary with itself. On a standalone basis, it is expected to clock a turnover of Rs.120 cr. and profit of Rs.16 cr. for FY08 i.e. an EPS of Rs.13.50 on its current equity of Rs.11.90 cr. Since the conversion price is high at Rs.325, its FCCB of Rs.50 cr. may not get converted into equity. Moreover, finding its valuation very cheap, the management has obtained the approval to buy back equity shares up to 24.30% of the total paid-up equity capital at a maximum price of Rs.215 per share. A golden opportunity to buy at such low price levels.
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Part of the B. M. Thapar Group, Greaves Cotton Ltd. (Code: 501455) (Rs.192.50) is engaged in the production of diesel/petrol/LPG engines for power generation, agro equipment and automotives apart from manufacturing gensets, agro equipment and construction equipment Besides, it is also engaged in marketing high technology systems for marine, aviation and electronic applications. Last year, to enhance its presence in the global market, it acquired Bukh Farymann Diesel GmbH (renamed as Greaves Farymann Diesel GmbH), which is engaged in the manufacture and marketing of single cylinder diesel engines and parts for Rs.25 cr. For FY08, it may clock a turnover of Rs.1400 cr. with PAT of Rs.115 cr. i.e. an EPS of Rs.24 on its current equity of Rs.48.80 cr. More importantly, few weeks back Piaggio Group's Indian subsidiary signed an 8 year agreement with the company for purchase of mono-cylinder diesel engines for application on the three-wheeled vehicles manufactured by it. This implies that the company will continue to be a single source supplier of such mono-cylinder diesel engines to Piaggio. A solid bet for long-term.
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PAE Ltd. (Rs.19.25) is in the automotive and non-automotive (industrial) segments of batteries and components/systems The power segment presents its new growth opportunities as PAE has launched power back-up devices and systems and sees excellent growth potential for them. It is a profit making and dividend paying company. In the current year expected EPS is around Rs.5/6. Last dividend was around 10%, which is likely to rise to 12% in the current year. At present, market cap is just Rs.19 cr. The stock has reacted from a high of Rs.54 to the current level of Rs.19 where it looks very attractive for investment.
* Torrent Cables (Rs.180) - Those who booked profits at higher levels can add this stock at the current level of Rs.180 or on dips. Full year expected EPS is Rs.38/40.
PAE Ltd. (Rs.19.25) is in the automotive and non-automotive (industrial) segments of batteries and components/systems The power segment presents its new growth opportunities as PAE has launched power back-up devices and systems and sees excellent growth potential for them. It is a profit making and dividend paying company. In the current year expected EPS is around Rs.5/6. Last dividend was around 10%, which is likely to rise to 12% in the current year. At present, market cap is just Rs.19 cr. The stock has reacted from a high of Rs.54 to the current level of Rs.19 where it looks very attractive for investment.
* Torrent Cables (Rs.180) - Those who booked profits at higher levels can add this stock at the current level of Rs.180 or on dips. Full year expected EPS is Rs.38/40.
Source: Internet
