Stock Idea: NRB Bearings Ltd.

NRB Bearings Ltd— BUY—65—INR
Sector — Bearings
Regd.Off.— Dhannur, 15 Sir P M Road Fort, Mumbai, Maharashtra-400001
Listed — NSE, BSE.
Company overview—
NRB bearings limited was incorporated in 1965 as an Indo-French venture with Nadella, pioneering the production of needle roller bearings in India. NRB acquired SNL Bearings Limited (SNL formerly Shriram Needle Bearings Industries Limited) in June 2000. The TUV Managements services (Gmbh), internationally acclaimed registrars awarded the QS 9000 Corporate Certification for NRB bearings at its corporate office and all of its plants in the year 2000. Over the years company has expanded to five modern manufacturing facilities producing needle, spherical, cylindrical, wide-inner ring bearings, tapered roller bearings and ball bearings. With continual thrust on tailoring bearings to suit specific needs, company has successfully developed customization and application expertise as their specialty. Growing skills and precision over years have won NRB worldwide acceptance, even in markets as demanding as Europe, south East Asia and Australia. Company is India’s most diversified bearings manufacturer. The company also has an agency division that handles sales and distribution for Defontaince SA-Rollix, Wschneeberger AG, Nadella, Gamet Bearings, IBC Walzalager Gmbh, Hallite Seals International Ltd., Agathon AG and Sferax SA. Company has a marketing JV with Switzerland-based Schneeberger. Company markets Schneeberger’s products such as high precision linear motion products and measurement systems in India.
Products & services—
Company's activities are organized into three divisions -- general bearings, needle bearings and agency. The general bearings division set up in 1982 manufactures cylindrical roller bearings. It later diversified into spherical roller bearings and ball bearings in technical collaboration with Ransome Hoffman Pollard International (RHP), UK. In 1995, its product range was diversified again by including taper roller bearings with technical know-how from SNR Roulements, France. Company has its R&D division in Thane, which is moving towards to become a complete bearing solution provider. It has full-fledged testing facilities and computer aided design center. The products of the company find application in light, medium and heavy commercial vehicles.
Company’s list of customers include Maruti Udyog, Mahindra & Mahindra, Telco, Ashok Leyland, Bajaj Tempo, Bajaj Auto, LML, TAFE, Siemens, ABB, HMT, Kelvinator, Lucas TVS and LMW. Company's agency division, works as an intermediary for a number of foreign companies in UK, France, Germany and Switzerland such as RHP, Gamet, Nadella, Rollix, IBC, Rohm, Schneeberger, Kugler SA and Forsheda. On quality front all the plants of the company and its corporate office is accredited with QS-9000 certificate by TUV, the internationally acclaimed registrars. Earlier the company and all its plants have been certified for ISO-9002.
Valuation—
Over 30% of the domestic Ball Bearings demand is met by imports in the present scenario. Company is looking towards inorganic, organic Expansions and optimum capacity utilizations. At CMP, stock is trading at only 8.74 P/E multiple of its FY2011 estimated EPS. We recommend investors to “BUY” “NRB bearings Limited” with medium to long-term investment prospects.

Source: Internet (Valuenotes by Abhishek Jain)

Stock Idea: Sunil HiTech

This company is in the business of fabrication, erection and commissioning related works required for power plants. Financially, the company has been a consistent performer but Q3 ended 31st Dec 2009 was not very good. A fall in topline and despite rationalization of costs, net profit remained low.
For Q3FY10, QoQ, net revenue was down 23% at Rs.154.61 crore and net profit fell 49% at Rs.6.39%. OPM margin was highest during the fiscal at 14.59%.
A look at the 9MFY10 performance shows that net sales was at Rs.550.07 crore v/s Rs.598.21 crore posted in FY09. Net profit was at Rs.27.46 crore compared to Rs.10.30 crore for FY09. Clearly, FY10 will end on a much higher note.
What is noteworthy in the company is its high order intake. In Q3FY10, it won Rs.642 crore orders which was 45.215 of its net order book. Its pending order book till date stands at Rs.2062 crore, which is pending to be executed in 24-30 months. The company is diversifying from the current stream of business and getting into whole time balance of plant (BOP) contracts for thermal power plants. This new diversification came through when it won 250 MW 488 crore order from Mahagenco. Its other big orders are from Koradi Thermal Power Station order and another from L&T for 193 crore.
In FY11, the company expects to have a topline of around Rs.1000 crore and net profit margin, it expects to maintain at 4.5% levels. The company will take a while to establish itself as a full fledged EPC, managing the entire plan know-how. But it surely puts the company into a league where it can now bid for projects above Rs.500 crore but within Rs.1000 crore.

Source: Internet (premiuminvestments.in by S P Tulsian)