Merrill Lynch has kept buy rating on IVRCL Infra; with a target of Rs 610
Hyderabad-based infrastructure IVRCL is the top pick of the broking house in the mid-cap construction space. The company has just recorded a strong performance for financial year 2008-09 with net profit up 49 per cent to Rs 210 crore and the order backlog up 67 per cent to Rs 12,800 crore. Merrill Lynch expects the firm to post an earning per share (EPS) growth of 25 per cent over 2008-10. The triggers for the company are its focus on the water sector, potential wins in infrastructure sector in the BOT (build operate and transfer) space and scaling up of its subsidiaries IVR Prime and Alcor Petroo. Some of the projects where the firm is a developer, including toll roads and the Chennai desalination plant, are set for completion during the current fiscal.
Friday, May 30, 2008
Wednesday, May 28, 2008
Subex - Press Release
Bangalore, INDIA: Subex Limited, a leading global provider of Operations and
Business Support Systems (OSS/BSS) for communications service providers, today
announced the launch of the first edition of The ROC Resource Book, a publication
that provides perspectives on Revenue and Operational Assurance, targeted at
communication service providers.
The book carries articles written by industry experts, analysts and researchers of the
telecom software industry, veteran journalists and leading writers, providing different
perspectives on ideas and opportunities for service providers to transform operations
and business processes to increase revenue.
“The telecom software industry, specifically the OSS/BSS space, is on a fast growth
track with exciting changes on the anvil. This publication is aimed at helping service
providers explore the strategies and best practices to manage the impact of
operations on profit”, said Adam Boone, VP – Marketing of Subex Ltd and the
publisher of the book.
Subex recently unveiled a new, expanded version of the ROC, which brings in the
ability to conduct operational assurance, enabling service providers to monitor and
manage the impact of operations on revenues, costs and profit. Like a service
provider's Network Operations Center (NOC) monitors the health of the network, a
ROC enables a service provider to manage the health of the financial and operational
chains that are critical to sustainable profitability and growth. The ROC Resource
Book explores these issues and discusses strategies for building a ROC that is
aligned to the business objectives of the service provider.
Business Support Systems (OSS/BSS) for communications service providers, today
announced the launch of the first edition of The ROC Resource Book, a publication
that provides perspectives on Revenue and Operational Assurance, targeted at
communication service providers.
The book carries articles written by industry experts, analysts and researchers of the
telecom software industry, veteran journalists and leading writers, providing different
perspectives on ideas and opportunities for service providers to transform operations
and business processes to increase revenue.
“The telecom software industry, specifically the OSS/BSS space, is on a fast growth
track with exciting changes on the anvil. This publication is aimed at helping service
providers explore the strategies and best practices to manage the impact of
operations on profit”, said Adam Boone, VP – Marketing of Subex Ltd and the
publisher of the book.
Subex recently unveiled a new, expanded version of the ROC, which brings in the
ability to conduct operational assurance, enabling service providers to monitor and
manage the impact of operations on revenues, costs and profit. Like a service
provider's Network Operations Center (NOC) monitors the health of the network, a
ROC enables a service provider to manage the health of the financial and operational
chains that are critical to sustainable profitability and growth. The ROC Resource
Book explores these issues and discusses strategies for building a ROC that is
aligned to the business objectives of the service provider.
IVRCL - Dividend
Ivrcl Infrastructures & Projects Ltd. has informed the Exchange that the Board of Directors of the Company at its meeting held on May 28, 2008 has recommended dividend for the year 2007-08 @70% i.e. Rs. 1.40 per equity share of Rs.2/- each.
IVRCL - Interview
IVRCL sees turnover at Rs 4,800-5,200cr ahead
Sudhir Reddy, CMD, IVRCL, said there was a 31% EBITDA growth over the previous quarter. "The company is looking at a 45-50% growth." He expects a turnover of Rs 4,800-5,200 crore going forward.
Excerpts from CNBC-TV18's exclusive interview with Sudhir Reddy:
Q: Your bottomline is lower than our expectations, have your margins slipped quite a bit in Q4 then?
A: No;this is some other revenue. We have taken into account managerial remuneration of Rs 4.4 crore, foreign currency convertible bonds, and notional forex loss of above Rs 6 crore. On a net aggregate basis, there is a 31% growth on EBITDA over the last quarter.
Q: In terms of pure orders that were executed, can you just break up what it stood at between water and road?
A: Water constitutes about 53%, roads would be about 9%, and the balance would be in the power sector.
Q: Can you just walk us through again the figure that you indicated in terms of operating profit margin performance and whether or not you have had some cost pressures because of input cost?
A: No, we didn’t. It was not input cost pressures, these were tenders with full price escalations which we were involved in. Close to Rs 10-12 crore is what we had to deduct this Q4 as per suggestions from auditors. In absolute terms there is a growth of almost 31% on EBITDA. For FY08, there is a 58% growth on topline from Rs 2,346 crore to Rs 3,700 crore.
Q: Could you take us through the kind of order flow that you have seen in Q4 and where does your orderbook stand now at the end of FY08?
A: We have Rs 13,000 crore of orders in hand and are L1, or lowest bidders, in another Rs 1,100 crore. We normally get 98-99% of full works. In total, we have orders worth Rs 14,000 crore. Out of which, 53-55% is in water. We have not taken any roads project on the build, operate, and transfer side last year. We are concentrating on completing whatever we have. So, the balance is coming out from the power side.
Q: There has been quite a few execution concerns about the entire space. For FY09, what sort of growth do you think IVRCL can maintain?
A: We are quite confident. I am sure we can do it as we have had 40-45% growth in the last 8-10 years. On a higher base, 45-50% might be a tough asking, which we would attempt to. However, we can execute a turnover of Rs 4,800-5,200 crore going forward.
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340094
Sudhir Reddy, CMD, IVRCL, said there was a 31% EBITDA growth over the previous quarter. "The company is looking at a 45-50% growth." He expects a turnover of Rs 4,800-5,200 crore going forward.
Excerpts from CNBC-TV18's exclusive interview with Sudhir Reddy:
Q: Your bottomline is lower than our expectations, have your margins slipped quite a bit in Q4 then?
A: No;this is some other revenue. We have taken into account managerial remuneration of Rs 4.4 crore, foreign currency convertible bonds, and notional forex loss of above Rs 6 crore. On a net aggregate basis, there is a 31% growth on EBITDA over the last quarter.
Q: In terms of pure orders that were executed, can you just break up what it stood at between water and road?
A: Water constitutes about 53%, roads would be about 9%, and the balance would be in the power sector.
Q: Can you just walk us through again the figure that you indicated in terms of operating profit margin performance and whether or not you have had some cost pressures because of input cost?
A: No, we didn’t. It was not input cost pressures, these were tenders with full price escalations which we were involved in. Close to Rs 10-12 crore is what we had to deduct this Q4 as per suggestions from auditors. In absolute terms there is a growth of almost 31% on EBITDA. For FY08, there is a 58% growth on topline from Rs 2,346 crore to Rs 3,700 crore.
Q: Could you take us through the kind of order flow that you have seen in Q4 and where does your orderbook stand now at the end of FY08?
A: We have Rs 13,000 crore of orders in hand and are L1, or lowest bidders, in another Rs 1,100 crore. We normally get 98-99% of full works. In total, we have orders worth Rs 14,000 crore. Out of which, 53-55% is in water. We have not taken any roads project on the build, operate, and transfer side last year. We are concentrating on completing whatever we have. So, the balance is coming out from the power side.
Q: There has been quite a few execution concerns about the entire space. For FY09, what sort of growth do you think IVRCL can maintain?
A: We are quite confident. I am sure we can do it as we have had 40-45% growth in the last 8-10 years. On a higher base, 45-50% might be a tough asking, which we would attempt to. However, we can execute a turnover of Rs 4,800-5,200 crore going forward.
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340094
IVRCL Results
IVRCL Infra Q4 net profit up at Rs 73.3 cr
IVRCL Infrastructure and Projects has announced its fourth quarter results. The company's Q4 net profit was up at Rs 73.3 crore from Rs 73 crore.
Its net sales were up at Rs 1326 versus Rs 992 crore.
Particulars Mar-08 Dec-07 Sep-07 Jun-07
Net Sales / Interest Earned / Operating Income 1321.728 974.857 688.454 677.318
Other Income 1.135 0.786 1.568 1.041
Total Income 1322.863 975.643 690.022 678.359
Expenditure -1182.98 -863.449 -633.147 -617.291
Operating Profit 139.883 112.194 56.875 61.068
Interest -20.772 -17.675 -7.599 -5.685
Profit Before Depreciation and Tax 119.111 94.519 49.276 55.383
Depreciation -9.91 -8.659 -7.634 -6.615
Profit before Tax 109.201 85.86 41.642 48.768
Tax -35.898 -21.804 -6.391 -10.808
Net Profit 73.303 64.056 35.251 37.96
Equity Capital 26.698 26.489 25.932 25.932
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340050
IVRCL Infrastructure and Projects has announced its fourth quarter results. The company's Q4 net profit was up at Rs 73.3 crore from Rs 73 crore.
Its net sales were up at Rs 1326 versus Rs 992 crore.
Particulars Mar-08 Dec-07 Sep-07 Jun-07
Net Sales / Interest Earned / Operating Income 1321.728 974.857 688.454 677.318
Other Income 1.135 0.786 1.568 1.041
Total Income 1322.863 975.643 690.022 678.359
Expenditure -1182.98 -863.449 -633.147 -617.291
Operating Profit 139.883 112.194 56.875 61.068
Interest -20.772 -17.675 -7.599 -5.685
Profit Before Depreciation and Tax 119.111 94.519 49.276 55.383
Depreciation -9.91 -8.659 -7.634 -6.615
Profit before Tax 109.201 85.86 41.642 48.768
Tax -35.898 -21.804 -6.391 -10.808
Net Profit 73.303 64.056 35.251 37.96
Equity Capital 26.698 26.489 25.932 25.932
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340050
IVR Prime - Results
IVR Prime Q4 net profit at Rs 42 cr
IVR Prime has announced its Q4 numbers. It has posted net profit of Rs 42 crore as against Rs 116.3 crore and revenue of Rs 240 crore versus Rs 296 crore, QoQ.
Particulars Mar-08 Dec-07 Sep-07
Net Sales / Interest Earned / Operating Income 233.419 295.951 45.613
Other Income 7.1 7.136 4.272
Total Income 240.519 303.087 49.885
Expenditure -170.582 -149.261 -26.798
Interest -5.228 -0.657 -0.97
Profit Before Depreciation and Tax 64.709 153.169 22.117
Depreciation -0.187 -0.215 -0.203
Profit before Tax 64.522 152.954 21.914
Tax -22.481 -36.631 -5.988
Net Profit 42.041 116.323 15.926
Equity Capital 64.15 64.15 64.15
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340085
IVR Prime has announced its Q4 numbers. It has posted net profit of Rs 42 crore as against Rs 116.3 crore and revenue of Rs 240 crore versus Rs 296 crore, QoQ.
Particulars Mar-08 Dec-07 Sep-07
Net Sales / Interest Earned / Operating Income 233.419 295.951 45.613
Other Income 7.1 7.136 4.272
Total Income 240.519 303.087 49.885
Expenditure -170.582 -149.261 -26.798
Interest -5.228 -0.657 -0.97
Profit Before Depreciation and Tax 64.709 153.169 22.117
Depreciation -0.187 -0.215 -0.203
Profit before Tax 64.522 152.954 21.914
Tax -22.481 -36.631 -5.988
Net Profit 42.041 116.323 15.926
Equity Capital 64.15 64.15 64.15
Link to the article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=340085
Tuesday, May 27, 2008
Alok - Mr Dilip Jiwrajka, Managing Director, Alok Industries Ltd
Alok Industries Ltd, established in 1986, is amongst the fastest growing vertically integrated textiles solutions provider in India. A diversified manufacturer of world-class home textiles, apparel fabrics, garments and polyester yarns, Alok has capacities of 82.50 mn meters of sheeting fabric and 6700 tons of terry towels for its home textiles business, 105.00 mn meters of apparel width woven fabrics, 67200 tons per annum of knitted fabrics and 22 million pieces per annum of garments. With the commencement of spinning of cotton yarn (32000 tons per annum), Alok has achieved complete integration. The company also has a strong presence in the polyester segment with a capacity of 114000 tons per annum of polyester textured yarn supplanted by 182500 tons per annum of POY and 182500 tons of PET. The company has a blue chip international customer base comprising of world renowned retailers, importers and brands.
Dilip Jiwrajka, Managing Director, Alok Industries Ltd, is a science graduate with a diploma in Business Entrepreneurship and Management., Mr Jiwrajka has 25 years experience in the manufacturing and trading of fabric for the garment industry. He is responsible for the weaving and processing divisions and overseeing the strategic planning, administration, finance functions and overall working of the company.
In a detailed reply to Anil Mascarenhas of India Infoline, Dilip Jiwrajka says, Alok’s business model is quite diversified which, while ensuring risk mitigation and stability of earning places it at a distinct competitive advantage.
The rupee did take its toll on many companies such as yours. Brief us about your financial performance.
We had a record export growth in a year when the rupee was in an appreciation mode and generally testing conditions had set in towards the latter half of the year. This proves that if one has the right size, right product, right quality and right price, then most challenges can be surmounted. We will consolidate operations this year and enhance efficiencies and endeavor to surpass expectations.
To briefly sum up, Alok Industries Limited reported net sales of Rs7.24bn for the quarter ended March 31, 2008, which is a jump of 26.25% over the same period last fiscal. Operating Net Profit for Q4 stood at Rs609mn, a growth of 24.45% yoy. The operating margin for Q4 FY08 was at 24.89% as against 23.34% recorded in Q4 FY07.
For the year ended March 31, 2008, net sales grew by 18.34% to Rs21.59bn compared to Rs18.24bn in the previous year. Operating net profit for the year ended March 31, 2008 rose by 23.79% to Rs1.67bn, as against Rs1.35bn posted in the same period of last fiscal. Earnings Per Share (EPS) for FY08 works out to Rs11.51 as compared to Rs9.70 for the same period last fiscal.
You mentioned about your record exports. Could you give the figures?
Export Sales for the fourth quarter stood at Rs3.85bn, a growth of 50.16% as compared to Rs2.56bn posted in the same period of last year. The figure of export sales for 2007-08 rose by 59.87% to Rs10.25bn as compared to Rs6.41bn in FY07.
The fire in one of your units had hit production. To what extend was your margin hit?
A fire broke out at the Sayali texturising unit with 70 machines on August 16, 2007, impacting the unit totally. The other units in the premises (weaving, knitting and POY), however, were not impacted. There was no major impact on the overall operations of the company due to a couple of reasons.
The Company has adequate Insurance Cover for its Building, Plant and Machinery and Stock. The total damage to the fixed assets is estimated at Rs2.25bn (including Rs250mn as loss of profit) and the same has been admitted by the insurance company. We have received an interim settlement of Rs1bn towards loss of assets and Rs100mn towards loss of profit. The balance claim is expected by June 2008.
Secondly, the company has rebuilt the new texturising unit in a record time of 90 days and inaugurated the new unit on 24th November 2007.
What about the impact on sales, margin and market share?
The net impact on sales of texturised yarn was expected to be in the region of Rs500 – 550mn. However, the same has been compensated by higher revenues from other divisions like Apparel fabrics, Home textiles and POY. There has been no impact on margins.
As far as market share is concerned, Alok is amongst the market leader in the texturised yarn segment. About one third of the texturised yarn is exported and the balance is sold in the domestic market. In view of the rebuilding of new texturising unit in 90 days and inauguration of the same on November 24, 2007, there was no impact in the market share.
What impact has the currency had on your performance? What kind of hedge are you doing? How do you read the situation?
The company has adopted a multi prone strategy to improve its overall performance including appreciating rupee.
We made a shift towards value added products:
Alok has tied up for contract farming spread over 140000 acres for exclusive supply of Organic and Fair Trade Cotton (approx 175000 bales) duly certified by SKAL and ECO CERT. Organic products are now getting more popular and fetch extra premium. This would not only give company additional margins but also provide a fair price for the farmers.
Institutional work wear with special finishes like Flame Retardant, Water Repellent, Anti-Bacteria, Vitamin –E finish, Ice Finish fabric, Anti Static, Aroma finish, Mosquito Repellent, etc., which have a distinct market and application such as Defence, Oil exploration, Hospitals, Hotels, Auto Industry, etc..
In Apparel woven fabrics, Alok is focused on manufacturing of Premium Yarn Dyed Fabrics and Bottom Weight fabrics which are always in demand and fetch higher margins.
In Home textiles, Alok is concentrating more on Higher Thread Cont bed sheets (500 TC to 1000 TC). Similarly, it is producing more quantities of quilts and comforters, where realizations and margins are high.
Alok has acquired brands from Mileta International, a Czech based company, like "Daks", "Lord Nelson", "Erba", which are being introduced in India in a gradual manner. It has also entered into licensee arrangement with Peacock Alley, a premium home textile brand of USA for distribution in India.
The second strategy was backward and forward Integration and economies of scale:
Alok has created large scale capacities with state-of-the-art technology to derive the benefits of economies of scale. It has further reduced its cost by going into backward integration into manufacturing of cotton yarn and POY. On the forward integration front, we have gone into manufacturing of finished products i.e. Garments, Bed sheets and Retailing. Further, the proportion of value added products in our overall product offering is also increasing.
The third is systematic approach of hedging:
The company has a systematic policy of hedging. The company has treasury department who take suitable heading measures from time to time and monitory it closely.
All the above strategies helped in improving the overall performance of the company and also mitigate the exchange fluctuation risk.
What is the expected utilization in your new facilities?
Normally, the machines take about 2 years for stabilization from the initial setting up. The capacity utilisation is about 70%, 80%, and 90% in the 1st, 2nd and 3rd year onwards. The company’s order booking position is comfortable and expects to achieve capacity utilisation of over 90% from the existing capacities and about 70% from the newly set up capacities i.e. capacities set up in FY2008.
What kind of value addition are you doing? What increase would it bring to your margins?
The company in order to improve its margins is concentrating on three main centers, which are as under:
1) Diversified Product Mix and Markets:
Alok has a diversified product mix and market segments. The business model of the company is briefly tabulated below:
Products Markets % share in revenue
Home Textiles Direct exports to Importers / Retailers 21%
(Sheet sets/Comforters, etc.,)
Apparel Fabrics & Cotton Yarn a) Sale to garment exporters in India / converter countries 50%
(Woven & Knits) b) Sale to domestic garment manufacturer / traders / retailers
Garments Direct export to Retailers / Importers 3%
(Woven & Knits)
Polyester Yarn a) Sale to domestic power loom weavers 25%
(Texturised yarn) b) Direct exports
Retailing Retailing of all products manufactured by company i.e. home textiles, apparel fabrics and garments through retail stores. 1%
(H & A)
Alok’s business model is quite diversified which, while ensuring risk mitigation and stability of earning also places the company at a distinct competitive advantage over other players in the industry. Alok has also ensured that its target market is a diverse mix of the international market, garment export trade and domestic market. The company has established itself both in the international and domestic market and has emerged as a leader in each of the product segment it operates.
The company’s sales comprise about 48% exports and 52% domestic sales. The company exports to more than 50 countries and its markets are well diversified into USA, Europe, Latin America, Africa, and Middle East.
Besides what I detailed earlier, on the domestic front, company has adopted multi prone strategy:
a) It supplies fabric to leading domestic and export garment manufacturers.
b) It markets through its distribution network to wholesalers, traders and retailers.
c) It supplies to the private labels of the big retailers.
d) It has started its own retail chain by the name ‘H&A’ and has opened 20 stores in Mumbai, Vapi, Bangalore and other parts of the country. The number of stores would increase to about 150 stores by FY09 and further to about 400 stores by FY10.
All these have started showing results and with the new capacities in place, the EBITDA margin is expected to improve further.
By when would we see the benefits of Alok Infrastructure on the company? Tell us more about your plans here. Two to three years down the line how do you see this business shaping up?
All the projects are expected to be commence from 2010-11. All the infrastructure related companies are subsidiaries of Alok Industries Limited (Alok) and the profits generated by these companies will be reflected in Alok in the form of dividend.
The company is into development of commercial and residential projects. It intends to develop only select projects which have good commercial viability thereby ranking amongst the top 15 developers in India.
The brief details of each of the subsidiaries are as under:
a) Alok Realtors Pvt. Ltd. (Peninsula Business Park)
575,000 sq ft of ultra modern office premises with world-class amenities, large open complex, landscaped gardens and water bodies
The first level starts at a height of 80 feet from the ground, thereby offering a fabulous view of the Arabian Sea and Mahalaxmi Race Course
500 car parking for occupants and visitors
8 high speed intelligent elevators
Club House with facilities for Gymnasium, Steam, Sauna and shower, exclusive designed lounge for CEOs, food court, coffee shop, indoor sports
High end security systems, advanced fire detection and fire fighting systems and power back up
Property would be professionally managed by Peninsula Facility
Proximity to Lower Parel and Currey Road station; 5 star hotel ITC;
Possession by March 2010
b) Ashford Infotech Pvt. Ltd (at Lower Parel & Nahur)
64,800 square feet of prime office space in Lower Parel
8 storey with floor plate of 8,100 sq. ft
40 car parks
Modern architecture with latest amenities
Proximity to Lower Parel and Currey Road station; 5 star hotel ITC
Possession by March 2009
Ashford Investment & Trading Company Pvt. Ltd and Alok Infrastructure Pvt. Ltd. proposes to develop an office complex in the CEAT factory compound at Nahur
The project is being developed in 50:50 Joint Venture with Ashford Group
A total area of approximately 7 acres of land has been acquired out of the 30 acres plot of the CEAT factory
Site demography – 3 min from Nahur and 5 min from Eastern Express Highway and Goregaon Mulund Link Road
The project to have an approximate saleable area of 10,31,100 Sq. ft.
Multi Level car parks for 1,000 cars
Air-conditioned lobbies on every floor
Air-conditioned atrium entry
Full height glass curtains
The complex would have most modern infrastructure and world class amenities with large open complex, landscaped gardens and water bodies. The complex would be supplemented with a Club house, gymnasium, pool, sauna, steam, banquet hall, business lounge, cafeterias and indoor sports
The project to be operational in 30 months
c) Silvassa Textile Specific Special Economic Zone (STSEZ)
Land fully purchased
Formal approval received for 183 acres. Notifying 145 acres in the first phase
Company would be developing and maintaining the SEZ and would be providing world class supporting infrastructure like power sub-station, Common ETP plant, commercial centre, training centre etc.
Strategically located with proximity to Mumbai Airport (150 Kms) and JNPT port (200 Kms)
To be fully developed by 2011-12
d) Alspun Property, Vapi
The company has acquired a 50% stake in Alspun Infrastructure Pvt Ltd. which in turn is developing an integrated township spread over 100 acres in Balitha, Vapi
The township would comprise of residential, commercial, retail and entertainment area with provision for schools, hospitals, clubhouse etc.
The township would be developed in a phased manner commencing from September 2008 and likely completion by 2012
You also have acquired land in Silvassa and Panvel. What are your plans here?
Alok Infrastructure has acquired 220 acres of land at Velugam, Silvassa for developing townships / SEZ. It is in the process of acquiring 130 acres of land at Panvel in 50% joint venture suitable for developing theme based township. The proposed land is about 15 kms distance from the proposed new airport and 8 km from the railway station. The project is at drawing board stage and the details would be conveyed as soon as they are finalised.
What kind of revenues do you see from the SEZ. What is the business model for the SEZ?
The company acquired 183 acres of land at Silvassa out of which 145 acres of land is being notified for SEZ in the first phase. The company proposes to provide open plots on long-term lease basis (one time lease) as well as constructed factories to textile units (on annual lease basis).
The company shall develop and maintain the SEZ and also provide world-class support infrastructure, viz, power substation, common ETP plant, commercial centre and training centre.
16 acres of open plots have already tied up for long-term lease. The SEZ is expected to be fully operational by March 2011-12.
The SEZ is expected to generate substantial revenue because of the above business model and amenities. However, the forward numbers cannot be disclosed because of SEBI guidelines.
The first tranche of warrants have been converted into equity from 28th April 2008. By when will the second tranche be converted. At what price?
The second tranche is expected to be converted on or before 31 July 2009 at a price of Rs102 (premium of Rs92 and face value of Rs10)
What is your outlook on branded retail. What is the progress with H&A? By when would this be hived off?
The increase in the per capita income, demography and penetration of economic activity in interiors of India has fuelled overall economic growth of India and it is expected to grow further. About 40% of the clothing in India is through retailing. With this background, branded retail would be the driving force going ahead.
H & A is Alok’s foray into branded retail segment targeted towards the mass market and offering ‘Value for money’ proposition. The company already has 20 stores and has plans to reach 40 stores by June 2008 with a two-year target of having 400 stores pan India.
The company in its board meeting held on 28th April 2008, has approved the hiving off of H&A division into a separate wholly owned subsidiary of Alok by the name “Alok Homes and Apparel Pvt. Ltd.” The company would seek the approval of the same from its shareholders soon.
What kind of tie-ups are you looking at?
Alok has acquired brands from Mileta International, a Czech based company, like "Daks", "Lord Nelson", "Erba", which are being introduced in India in a gradual manner. It has also entered into licensee arrangement with Peacock Alley, a premium home textile brand of USA for distribution in India.
Apart from the above, the company is keen to have long-term strategic tie-ups for marketing of its diversified multi product range in overseas markets.
Your dividend policy? Your message to shareholders?
The company has been consistently paying dividend from last 15 years and would certainly share its wealth with the share holders. We would like to inform all our share holders that with the above measures being taken by the company, the share holders will be benefited.
Link to the article: http://www.indiainfoline.com/news/showleader.asp?storyId=636&lmn=1
Dilip Jiwrajka, Managing Director, Alok Industries Ltd, is a science graduate with a diploma in Business Entrepreneurship and Management., Mr Jiwrajka has 25 years experience in the manufacturing and trading of fabric for the garment industry. He is responsible for the weaving and processing divisions and overseeing the strategic planning, administration, finance functions and overall working of the company.
In a detailed reply to Anil Mascarenhas of India Infoline, Dilip Jiwrajka says, Alok’s business model is quite diversified which, while ensuring risk mitigation and stability of earning places it at a distinct competitive advantage.
The rupee did take its toll on many companies such as yours. Brief us about your financial performance.
We had a record export growth in a year when the rupee was in an appreciation mode and generally testing conditions had set in towards the latter half of the year. This proves that if one has the right size, right product, right quality and right price, then most challenges can be surmounted. We will consolidate operations this year and enhance efficiencies and endeavor to surpass expectations.
To briefly sum up, Alok Industries Limited reported net sales of Rs7.24bn for the quarter ended March 31, 2008, which is a jump of 26.25% over the same period last fiscal. Operating Net Profit for Q4 stood at Rs609mn, a growth of 24.45% yoy. The operating margin for Q4 FY08 was at 24.89% as against 23.34% recorded in Q4 FY07.
For the year ended March 31, 2008, net sales grew by 18.34% to Rs21.59bn compared to Rs18.24bn in the previous year. Operating net profit for the year ended March 31, 2008 rose by 23.79% to Rs1.67bn, as against Rs1.35bn posted in the same period of last fiscal. Earnings Per Share (EPS) for FY08 works out to Rs11.51 as compared to Rs9.70 for the same period last fiscal.
You mentioned about your record exports. Could you give the figures?
Export Sales for the fourth quarter stood at Rs3.85bn, a growth of 50.16% as compared to Rs2.56bn posted in the same period of last year. The figure of export sales for 2007-08 rose by 59.87% to Rs10.25bn as compared to Rs6.41bn in FY07.
The fire in one of your units had hit production. To what extend was your margin hit?
A fire broke out at the Sayali texturising unit with 70 machines on August 16, 2007, impacting the unit totally. The other units in the premises (weaving, knitting and POY), however, were not impacted. There was no major impact on the overall operations of the company due to a couple of reasons.
The Company has adequate Insurance Cover for its Building, Plant and Machinery and Stock. The total damage to the fixed assets is estimated at Rs2.25bn (including Rs250mn as loss of profit) and the same has been admitted by the insurance company. We have received an interim settlement of Rs1bn towards loss of assets and Rs100mn towards loss of profit. The balance claim is expected by June 2008.
Secondly, the company has rebuilt the new texturising unit in a record time of 90 days and inaugurated the new unit on 24th November 2007.
What about the impact on sales, margin and market share?
The net impact on sales of texturised yarn was expected to be in the region of Rs500 – 550mn. However, the same has been compensated by higher revenues from other divisions like Apparel fabrics, Home textiles and POY. There has been no impact on margins.
As far as market share is concerned, Alok is amongst the market leader in the texturised yarn segment. About one third of the texturised yarn is exported and the balance is sold in the domestic market. In view of the rebuilding of new texturising unit in 90 days and inauguration of the same on November 24, 2007, there was no impact in the market share.
What impact has the currency had on your performance? What kind of hedge are you doing? How do you read the situation?
The company has adopted a multi prone strategy to improve its overall performance including appreciating rupee.
We made a shift towards value added products:
Alok has tied up for contract farming spread over 140000 acres for exclusive supply of Organic and Fair Trade Cotton (approx 175000 bales) duly certified by SKAL and ECO CERT. Organic products are now getting more popular and fetch extra premium. This would not only give company additional margins but also provide a fair price for the farmers.
Institutional work wear with special finishes like Flame Retardant, Water Repellent, Anti-Bacteria, Vitamin –E finish, Ice Finish fabric, Anti Static, Aroma finish, Mosquito Repellent, etc., which have a distinct market and application such as Defence, Oil exploration, Hospitals, Hotels, Auto Industry, etc..
In Apparel woven fabrics, Alok is focused on manufacturing of Premium Yarn Dyed Fabrics and Bottom Weight fabrics which are always in demand and fetch higher margins.
In Home textiles, Alok is concentrating more on Higher Thread Cont bed sheets (500 TC to 1000 TC). Similarly, it is producing more quantities of quilts and comforters, where realizations and margins are high.
Alok has acquired brands from Mileta International, a Czech based company, like "Daks", "Lord Nelson", "Erba", which are being introduced in India in a gradual manner. It has also entered into licensee arrangement with Peacock Alley, a premium home textile brand of USA for distribution in India.
The second strategy was backward and forward Integration and economies of scale:
Alok has created large scale capacities with state-of-the-art technology to derive the benefits of economies of scale. It has further reduced its cost by going into backward integration into manufacturing of cotton yarn and POY. On the forward integration front, we have gone into manufacturing of finished products i.e. Garments, Bed sheets and Retailing. Further, the proportion of value added products in our overall product offering is also increasing.
The third is systematic approach of hedging:
The company has a systematic policy of hedging. The company has treasury department who take suitable heading measures from time to time and monitory it closely.
All the above strategies helped in improving the overall performance of the company and also mitigate the exchange fluctuation risk.
What is the expected utilization in your new facilities?
Normally, the machines take about 2 years for stabilization from the initial setting up. The capacity utilisation is about 70%, 80%, and 90% in the 1st, 2nd and 3rd year onwards. The company’s order booking position is comfortable and expects to achieve capacity utilisation of over 90% from the existing capacities and about 70% from the newly set up capacities i.e. capacities set up in FY2008.
What kind of value addition are you doing? What increase would it bring to your margins?
The company in order to improve its margins is concentrating on three main centers, which are as under:
1) Diversified Product Mix and Markets:
Alok has a diversified product mix and market segments. The business model of the company is briefly tabulated below:
Products Markets % share in revenue
Home Textiles Direct exports to Importers / Retailers 21%
(Sheet sets/Comforters, etc.,)
Apparel Fabrics & Cotton Yarn a) Sale to garment exporters in India / converter countries 50%
(Woven & Knits) b) Sale to domestic garment manufacturer / traders / retailers
Garments Direct export to Retailers / Importers 3%
(Woven & Knits)
Polyester Yarn a) Sale to domestic power loom weavers 25%
(Texturised yarn) b) Direct exports
Retailing Retailing of all products manufactured by company i.e. home textiles, apparel fabrics and garments through retail stores. 1%
(H & A)
Alok’s business model is quite diversified which, while ensuring risk mitigation and stability of earning also places the company at a distinct competitive advantage over other players in the industry. Alok has also ensured that its target market is a diverse mix of the international market, garment export trade and domestic market. The company has established itself both in the international and domestic market and has emerged as a leader in each of the product segment it operates.
The company’s sales comprise about 48% exports and 52% domestic sales. The company exports to more than 50 countries and its markets are well diversified into USA, Europe, Latin America, Africa, and Middle East.
Besides what I detailed earlier, on the domestic front, company has adopted multi prone strategy:
a) It supplies fabric to leading domestic and export garment manufacturers.
b) It markets through its distribution network to wholesalers, traders and retailers.
c) It supplies to the private labels of the big retailers.
d) It has started its own retail chain by the name ‘H&A’ and has opened 20 stores in Mumbai, Vapi, Bangalore and other parts of the country. The number of stores would increase to about 150 stores by FY09 and further to about 400 stores by FY10.
All these have started showing results and with the new capacities in place, the EBITDA margin is expected to improve further.
By when would we see the benefits of Alok Infrastructure on the company? Tell us more about your plans here. Two to three years down the line how do you see this business shaping up?
All the projects are expected to be commence from 2010-11. All the infrastructure related companies are subsidiaries of Alok Industries Limited (Alok) and the profits generated by these companies will be reflected in Alok in the form of dividend.
The company is into development of commercial and residential projects. It intends to develop only select projects which have good commercial viability thereby ranking amongst the top 15 developers in India.
The brief details of each of the subsidiaries are as under:
a) Alok Realtors Pvt. Ltd. (Peninsula Business Park)
575,000 sq ft of ultra modern office premises with world-class amenities, large open complex, landscaped gardens and water bodies
The first level starts at a height of 80 feet from the ground, thereby offering a fabulous view of the Arabian Sea and Mahalaxmi Race Course
500 car parking for occupants and visitors
8 high speed intelligent elevators
Club House with facilities for Gymnasium, Steam, Sauna and shower, exclusive designed lounge for CEOs, food court, coffee shop, indoor sports
High end security systems, advanced fire detection and fire fighting systems and power back up
Property would be professionally managed by Peninsula Facility
Proximity to Lower Parel and Currey Road station; 5 star hotel ITC;
Possession by March 2010
b) Ashford Infotech Pvt. Ltd (at Lower Parel & Nahur)
64,800 square feet of prime office space in Lower Parel
8 storey with floor plate of 8,100 sq. ft
40 car parks
Modern architecture with latest amenities
Proximity to Lower Parel and Currey Road station; 5 star hotel ITC
Possession by March 2009
Ashford Investment & Trading Company Pvt. Ltd and Alok Infrastructure Pvt. Ltd. proposes to develop an office complex in the CEAT factory compound at Nahur
The project is being developed in 50:50 Joint Venture with Ashford Group
A total area of approximately 7 acres of land has been acquired out of the 30 acres plot of the CEAT factory
Site demography – 3 min from Nahur and 5 min from Eastern Express Highway and Goregaon Mulund Link Road
The project to have an approximate saleable area of 10,31,100 Sq. ft.
Multi Level car parks for 1,000 cars
Air-conditioned lobbies on every floor
Air-conditioned atrium entry
Full height glass curtains
The complex would have most modern infrastructure and world class amenities with large open complex, landscaped gardens and water bodies. The complex would be supplemented with a Club house, gymnasium, pool, sauna, steam, banquet hall, business lounge, cafeterias and indoor sports
The project to be operational in 30 months
c) Silvassa Textile Specific Special Economic Zone (STSEZ)
Land fully purchased
Formal approval received for 183 acres. Notifying 145 acres in the first phase
Company would be developing and maintaining the SEZ and would be providing world class supporting infrastructure like power sub-station, Common ETP plant, commercial centre, training centre etc.
Strategically located with proximity to Mumbai Airport (150 Kms) and JNPT port (200 Kms)
To be fully developed by 2011-12
d) Alspun Property, Vapi
The company has acquired a 50% stake in Alspun Infrastructure Pvt Ltd. which in turn is developing an integrated township spread over 100 acres in Balitha, Vapi
The township would comprise of residential, commercial, retail and entertainment area with provision for schools, hospitals, clubhouse etc.
The township would be developed in a phased manner commencing from September 2008 and likely completion by 2012
You also have acquired land in Silvassa and Panvel. What are your plans here?
Alok Infrastructure has acquired 220 acres of land at Velugam, Silvassa for developing townships / SEZ. It is in the process of acquiring 130 acres of land at Panvel in 50% joint venture suitable for developing theme based township. The proposed land is about 15 kms distance from the proposed new airport and 8 km from the railway station. The project is at drawing board stage and the details would be conveyed as soon as they are finalised.
What kind of revenues do you see from the SEZ. What is the business model for the SEZ?
The company acquired 183 acres of land at Silvassa out of which 145 acres of land is being notified for SEZ in the first phase. The company proposes to provide open plots on long-term lease basis (one time lease) as well as constructed factories to textile units (on annual lease basis).
The company shall develop and maintain the SEZ and also provide world-class support infrastructure, viz, power substation, common ETP plant, commercial centre and training centre.
16 acres of open plots have already tied up for long-term lease. The SEZ is expected to be fully operational by March 2011-12.
The SEZ is expected to generate substantial revenue because of the above business model and amenities. However, the forward numbers cannot be disclosed because of SEBI guidelines.
The first tranche of warrants have been converted into equity from 28th April 2008. By when will the second tranche be converted. At what price?
The second tranche is expected to be converted on or before 31 July 2009 at a price of Rs102 (premium of Rs92 and face value of Rs10)
What is your outlook on branded retail. What is the progress with H&A? By when would this be hived off?
The increase in the per capita income, demography and penetration of economic activity in interiors of India has fuelled overall economic growth of India and it is expected to grow further. About 40% of the clothing in India is through retailing. With this background, branded retail would be the driving force going ahead.
H & A is Alok’s foray into branded retail segment targeted towards the mass market and offering ‘Value for money’ proposition. The company already has 20 stores and has plans to reach 40 stores by June 2008 with a two-year target of having 400 stores pan India.
The company in its board meeting held on 28th April 2008, has approved the hiving off of H&A division into a separate wholly owned subsidiary of Alok by the name “Alok Homes and Apparel Pvt. Ltd.” The company would seek the approval of the same from its shareholders soon.
What kind of tie-ups are you looking at?
Alok has acquired brands from Mileta International, a Czech based company, like "Daks", "Lord Nelson", "Erba", which are being introduced in India in a gradual manner. It has also entered into licensee arrangement with Peacock Alley, a premium home textile brand of USA for distribution in India.
Apart from the above, the company is keen to have long-term strategic tie-ups for marketing of its diversified multi product range in overseas markets.
Your dividend policy? Your message to shareholders?
The company has been consistently paying dividend from last 15 years and would certainly share its wealth with the share holders. We would like to inform all our share holders that with the above measures being taken by the company, the share holders will be benefited.
Link to the article: http://www.indiainfoline.com/news/showleader.asp?storyId=636&lmn=1
Monday, May 26, 2008
IVRCL - Desalination project could be delayed
The commissioning of the 100-million litres a day (mld) desalination plant at Kattupalli near suburban Minjur is likely to be delayed by four months. It was scheduled to be commissioned in August this year.
Attributing the delay to unseasonal rain in March, Chennai Metrowater officials said about 70 per cent of the works had been completed. Dredging operation also could not be carried out due to rough sea. Dredging would facilitate laying of a separate pipeline to draw seawater from 10-metre-depth below sea level and discharge waste water, a Metrowater official said.
Though about 15 mld of water was to be supplied on completion of the first phase of the project, envisaged to be completed in May, the delay had pushed the project deadline to December, he said.
Chennai Water Desalination Limited, a special purpose vehicle formed by IVRCL Infrastructures and Projects Limited and its technical partner Befesa Construccion y Tecnologia Ambiental, Spain, started implementing the project on a DBOOT (design, build, own, operate and transfer) basis last year.
The official said work for constructing units such as sand filters and cartridge filters, used to remove minute particles as part of the preliminary treatment, was under way. The process to erect five reverse osmosis units, an important component in desalinating seawater, was also in progress. Each of the unit that had a capacity to treat 20 mld of seawater would be commissioned one after another during December, the official said.
About Rs.118 crore was expected to be spent on purchase of water from the Minjur plant.
Link to the article: http://www.hindu.com/2008/05/26/stories/2008052657300100.htm
Attributing the delay to unseasonal rain in March, Chennai Metrowater officials said about 70 per cent of the works had been completed. Dredging operation also could not be carried out due to rough sea. Dredging would facilitate laying of a separate pipeline to draw seawater from 10-metre-depth below sea level and discharge waste water, a Metrowater official said.
Though about 15 mld of water was to be supplied on completion of the first phase of the project, envisaged to be completed in May, the delay had pushed the project deadline to December, he said.
Chennai Water Desalination Limited, a special purpose vehicle formed by IVRCL Infrastructures and Projects Limited and its technical partner Befesa Construccion y Tecnologia Ambiental, Spain, started implementing the project on a DBOOT (design, build, own, operate and transfer) basis last year.
The official said work for constructing units such as sand filters and cartridge filters, used to remove minute particles as part of the preliminary treatment, was under way. The process to erect five reverse osmosis units, an important component in desalinating seawater, was also in progress. Each of the unit that had a capacity to treat 20 mld of seawater would be commissioned one after another during December, the official said.
About Rs.118 crore was expected to be spent on purchase of water from the Minjur plant.
Link to the article: http://www.hindu.com/2008/05/26/stories/2008052657300100.htm
Saturday, May 24, 2008
Jaiprakash - Jaypee's Municipal Solid Waste Processing Plant inaugurated
General (retd) S.F.Rodrigues, the Administrator Union Territory, Chandigarh and Governor of Panjab inaugurated the municipal solid waste processing plant in Dadu Majra in Sector 25 West, Chandigarh, India, on 21st May. " This project is for the benefit of the common man and only need is to sustain this project to make it a success," he added. This would not only rid the city of stink and pollution but would provide eco-friendly alternative fuel The plant, a public private initiative between Jaiprakash Associates Ltd and the Municipal Corporation, Chandigarh, has been completed in a stipulated time frame as per the agreement which was signed on 30th December 2005 and its foundation stone was laid by Gen Rodrigues on 21st February 2006, said Mr. Rajiv Gaur, President, Jaiprakash Associates Limited.
The plant shall be operational after about three months when complete process gets stabilised, he informed. Set up at a cost of Rs.30 crores on a 10 acres land, the plant which is one of its kind in northern India, has the installed capacity to process 500 ton per day of municipal solid waste, which will be converted into refuse-derived fuel to be used in a thermal power plant in Ropar and a cement plant of Jaypee Group in Himachal Pradesh. Mr. Pradeep Mehra, Advisor to the Administrator, said that the leaves sheded by trees in the city, which is the greenest city in the country today, shall also be processed in the plant for converting to fuel pellets.
Dr. Roshan Sunkaria, Commissioner, Municipal Commissioner, informed that the city has simultaneously launched another complimentary project at the site to cap 42 acres of landfill site, and make it usable for putting up playground or sports facilities. The plant is eco-friendly conforming to the norms laid down by Pollution Control Committee of Chandigarh Administration, and has been fenced, with green cover of trees planted around it to create the green buffer zone.
The plant is fully-covered to minimise exposure to atmosphere, and arrangements to spray culture on the garbage to eliminate insects, flies and odour have also been made. All critical equipment have been imported from Dopastadt Germany and the plant has been commissioned successfully in the supervision of German engineers, which has a fully-equipped laboratory, a workshop, and a fully-automatic control room, effluent treatment plant and fire safety equipment.
The project will give much needed relief to the residents of Chandigarh, and the localities near Dadu Majra waste dump site in particular, which suffered from methane emission due to anaerobic decomposition of MSW in uncontrolled open landfill site, which had so far been the only practice of disposal of garbage. The project shall also help in conservation of fossil fuels, enhance nations's energy security, prevent ground water contamination due to leakage of leachate, stop open dumping, enhance the city's aesthetics and overall hygiene of the area in and around the landfill sties, said Mr. Gaur.
The function was attended by Home Secretary Mr Sanjay Kumar, Deputy Commissioner, Mr. R.K. Rao, former Mayor of Chandigarh Mrs. Harjinder Kaur, municipal councillors, and various officers of the city. Jaypee Group a Rs.4,500 crores industrial conglomerate having rich presence in infrastructure, hydro-power, cement, education and hospitality sectors, embarking on environmental friendly projects to fulfill its social objectives, has taken up this project on BOOT basis - transforming challenges into opportunities - true to its reputation.
- End -
Jaypee Associates Limited is a Rs.4500 crore company that has set up in Chandigarh, the north India's first municipal waste processing plant at a cost of Rs.30 crore, in association with the Municipal Corporation Chandigarh.
Link to the article: http://www.indiaprwire.com/pressrelease/environmental-services/200805229726.htm
The plant shall be operational after about three months when complete process gets stabilised, he informed. Set up at a cost of Rs.30 crores on a 10 acres land, the plant which is one of its kind in northern India, has the installed capacity to process 500 ton per day of municipal solid waste, which will be converted into refuse-derived fuel to be used in a thermal power plant in Ropar and a cement plant of Jaypee Group in Himachal Pradesh. Mr. Pradeep Mehra, Advisor to the Administrator, said that the leaves sheded by trees in the city, which is the greenest city in the country today, shall also be processed in the plant for converting to fuel pellets.
Dr. Roshan Sunkaria, Commissioner, Municipal Commissioner, informed that the city has simultaneously launched another complimentary project at the site to cap 42 acres of landfill site, and make it usable for putting up playground or sports facilities. The plant is eco-friendly conforming to the norms laid down by Pollution Control Committee of Chandigarh Administration, and has been fenced, with green cover of trees planted around it to create the green buffer zone.
The plant is fully-covered to minimise exposure to atmosphere, and arrangements to spray culture on the garbage to eliminate insects, flies and odour have also been made. All critical equipment have been imported from Dopastadt Germany and the plant has been commissioned successfully in the supervision of German engineers, which has a fully-equipped laboratory, a workshop, and a fully-automatic control room, effluent treatment plant and fire safety equipment.
The project will give much needed relief to the residents of Chandigarh, and the localities near Dadu Majra waste dump site in particular, which suffered from methane emission due to anaerobic decomposition of MSW in uncontrolled open landfill site, which had so far been the only practice of disposal of garbage. The project shall also help in conservation of fossil fuels, enhance nations's energy security, prevent ground water contamination due to leakage of leachate, stop open dumping, enhance the city's aesthetics and overall hygiene of the area in and around the landfill sties, said Mr. Gaur.
The function was attended by Home Secretary Mr Sanjay Kumar, Deputy Commissioner, Mr. R.K. Rao, former Mayor of Chandigarh Mrs. Harjinder Kaur, municipal councillors, and various officers of the city. Jaypee Group a Rs.4,500 crores industrial conglomerate having rich presence in infrastructure, hydro-power, cement, education and hospitality sectors, embarking on environmental friendly projects to fulfill its social objectives, has taken up this project on BOOT basis - transforming challenges into opportunities - true to its reputation.
- End -
Jaypee Associates Limited is a Rs.4500 crore company that has set up in Chandigarh, the north India's first municipal waste processing plant at a cost of Rs.30 crore, in association with the Municipal Corporation Chandigarh.
Link to the article: http://www.indiaprwire.com/pressrelease/environmental-services/200805229726.htm
Friday, May 23, 2008
Jaiprakash - Jaiprakash acquires Bina Power from Aditya Birla group
ET reported that Jaiprakash Power Venture Limited has acquired Bina Power Supply Limited from the Aditya Birla Group for INR 150 to INR 175 crore. Aditya Birla Group had formed BPSCL in the early 1990s to develop a 1,000 MW power plant in two phases of 500 MW each at Bina in Madhya Pradesh, but did not pursue it after the initial progress.
Mr Suren Jain MD of JPVL said that "JPVL has now approached the Madhya Pradesh government for revival of the various approvals required for the setting up of the plant." He added that the first phase of the project would commence operations within 48 months of receipt of all approvals. JPVL plans to commission 500 MW in the first phase at an investment of INR 2,500 crore and subsequently raise the capacity to 1,000 MW.
Post the Bina acquisition, JPVL will have interests in almost 7,000 MW of power assets. These projects, which are at different stages of implementation include 1,000 MW Karcham Wangtoo Hydro Electric Project, 1,320 MW super critical technology coal based power plant at Nigrie in MP, two projects totaling 2,500 MW in Arunachal Pradesh and two projects totaling 720 MW in Meghalaya.
Link to the article: http://steelguru.com/news/index/2008/05/23/NDY3NDk%3D/Jaiprakash_acquires_Bina_Power_from_Aditya_Birla_group.html
Mr Suren Jain MD of JPVL said that "JPVL has now approached the Madhya Pradesh government for revival of the various approvals required for the setting up of the plant." He added that the first phase of the project would commence operations within 48 months of receipt of all approvals. JPVL plans to commission 500 MW in the first phase at an investment of INR 2,500 crore and subsequently raise the capacity to 1,000 MW.
Post the Bina acquisition, JPVL will have interests in almost 7,000 MW of power assets. These projects, which are at different stages of implementation include 1,000 MW Karcham Wangtoo Hydro Electric Project, 1,320 MW super critical technology coal based power plant at Nigrie in MP, two projects totaling 2,500 MW in Arunachal Pradesh and two projects totaling 720 MW in Meghalaya.
Link to the article: http://steelguru.com/news/index/2008/05/23/NDY3NDk%3D/Jaiprakash_acquires_Bina_Power_from_Aditya_Birla_group.html
Wednesday, May 21, 2008
Subex - Romtelecom selects Subex for centralized operations center for mitigating risks to the revenue chain
Subex Limited, a leading global provider of Operations and Business Support Systems (OSS/BSS) for communications service providers, today announced that Romtelecom, Romania’s largest fixed-line operator, has selected Subex Rocware™ solutions to form the core of a Revenue Operations Center (ROC).
Romtelecom‘s objective is to reduce the risk of financial loss from revenue leakage, fraud or bad debts. The ROC environment at Romtelecom will include Subex’s Moneta™ Revenue Assurance Solution, NikiraTM Fraud Management Solution and the Prevea™ Risk Management Solution.
Anastasios Tzoulas, Chief Financial Officer, Romtelecom said, “We found Subex to be a knowledgeable partner who is ready to help us achieve this important risk management objective. The ROC will provide us with a centralized, integrated platform to maximize, control and secure our revenue chain.”
Like a Network Operations Center (NOC) ensures the health of the network, a ROC ensures the integrity of a telco’s revenue streams, processes and improves visibility of the financial impact of the enterprise’s operations. The ROC at Romtelecom will provide advanced revenue and risk management capabilities as it combines revenue assurance, fraud management and risk management in one integrated framework.
Subex pioneered the concept of a ROC as a centralized collection of systems and processes correlating operational activities to the impacts on revenues, costs and, ultimately, profit. A ROC can enable an operator to adopt Operational Assurance, gaining better understanding and control over how operations support critical business goals.
Mark Nicholson, CTO, Subex said, “We are delighted that Romtelecom has selected Subex and the ROC. We are pleased to have this opportunity to assist Romtelecom in meeting its important revenue risk mitigation objectives.”
Subex is the trusted partner of communications service providers around the world seeking to achieve enhanced operational dexterity, offering rapid and flexible delivery of innovative new services while running lean operations. Subex’s award-winning family of best-of-breed solutions is the foundation of the ROC, enabling operational assurance and, as a result, improved operational dexterity.
At TM Forum Management World Nice, May 20 -22, Subex will demonstrate a ROC as part of the Content Encounter 2 Catalyst project, the premier demonstration of the delivery of advanced, content-based services involving Tier 1 operators from around the world
Link to the article: http://www.equitybulls.com/admin/news2006/news_det.asp?id=30839
Romtelecom‘s objective is to reduce the risk of financial loss from revenue leakage, fraud or bad debts. The ROC environment at Romtelecom will include Subex’s Moneta™ Revenue Assurance Solution, NikiraTM Fraud Management Solution and the Prevea™ Risk Management Solution.
Anastasios Tzoulas, Chief Financial Officer, Romtelecom said, “We found Subex to be a knowledgeable partner who is ready to help us achieve this important risk management objective. The ROC will provide us with a centralized, integrated platform to maximize, control and secure our revenue chain.”
Like a Network Operations Center (NOC) ensures the health of the network, a ROC ensures the integrity of a telco’s revenue streams, processes and improves visibility of the financial impact of the enterprise’s operations. The ROC at Romtelecom will provide advanced revenue and risk management capabilities as it combines revenue assurance, fraud management and risk management in one integrated framework.
Subex pioneered the concept of a ROC as a centralized collection of systems and processes correlating operational activities to the impacts on revenues, costs and, ultimately, profit. A ROC can enable an operator to adopt Operational Assurance, gaining better understanding and control over how operations support critical business goals.
Mark Nicholson, CTO, Subex said, “We are delighted that Romtelecom has selected Subex and the ROC. We are pleased to have this opportunity to assist Romtelecom in meeting its important revenue risk mitigation objectives.”
Subex is the trusted partner of communications service providers around the world seeking to achieve enhanced operational dexterity, offering rapid and flexible delivery of innovative new services while running lean operations. Subex’s award-winning family of best-of-breed solutions is the foundation of the ROC, enabling operational assurance and, as a result, improved operational dexterity.
At TM Forum Management World Nice, May 20 -22, Subex will demonstrate a ROC as part of the Content Encounter 2 Catalyst project, the premier demonstration of the delivery of advanced, content-based services involving Tier 1 operators from around the world
Link to the article: http://www.equitybulls.com/admin/news2006/news_det.asp?id=30839
Monday, May 19, 2008
Subex - Subex unveils groundbreaking new OSS and BSS solutions
Subex is unveiling a new version of its industry-leading Revenue Operations Center (ROC) and is launching new products in its revenue maximization and fulfillment and assurance business lines. The solutions are debuting at the TeleManagement Forum's Management World 2008, held between May 18 - 22 in Nice, France.
Subex will unveil a new version of its industry-leading ROC through demonstrations at Management World 2008. The ROC is a centralized collection of systems and processes correlating operational activities to the impacts on revenues, costs and, ultimately profit, and ensures the integrity of a Lelco’s revenue streams and processes.
With the previous version of the ROC, operators could conduct advanced revenue management and maximize efficiencies around revenue assurance and fraud management. The new version of the ROC builds on this capability to enable an operator to adopt Operational Assurance, gaining better understanding and control over how operations support critical business goals. Demonstrations of the ROC will take place at the Subex booth and in the ‘Content Encounter II' a Catalyst demonstration program covering emerging best practices and techniques for delivering advanced content-based services.
The company also is taking part in a Catalyst project highlighting an end-to-end B/OSS Framework for streamlining and standardising the processes of bringing new telecom products to market, using Syndesis Controlle. The project will demonstrate concept-to-market and order fulfillment processes, as well as order and trouble ticket fall-out management.
Subex will also launch its WiMAX-enabled Syndesis Express solution, designed to help operators to quickly and efficiently define and deliver value-added, next- generation services, like VolP and IPTV, over WiMAX. Also at Management World, Subex will launch Optima 4.6, the new version of its route optimization system, a part of its revenue maxmization offerings, designed to help service providers to create optimized route plans for automatic switch upload as well as facilitating a full reporting suite for data analysis.
In addition to the above, Subex’s CTO, Mark Nicholson will be chairing a presentation track on Strategies & Solutions for monetizing digital media services to held be on May 20. Subex also will present on the topic of revenue assurance for next generation services, providing insights on proactively identifying, analyzing and implementing scalable revenue integrity solutions to maximize revenue.
Subex is known around the world as a leader in revenue maximization and fulfillment solutions that enables communications service providers to achieve their business objectives. Its industry leading products help service operators gain that competitive advantage in quickly rolling out services, while mitigating costs, through the concept of operational assurance. The company has a significant presence in all the leading telecom markets of the world, Mark Nicholson was also recently appointed as advisory director on the TM Forum board.
Management World 2008 is the annual global event for the management of information, communications and entertainment services organised by TM Forum, the world’s leading trade consortium focused on enabling digital services.
Link to the article: http://www.ndtvprofit.com/2008/05/19165106/Subex-unveils-groundbreaking-n.html
Subex will unveil a new version of its industry-leading ROC through demonstrations at Management World 2008. The ROC is a centralized collection of systems and processes correlating operational activities to the impacts on revenues, costs and, ultimately profit, and ensures the integrity of a Lelco’s revenue streams and processes.
With the previous version of the ROC, operators could conduct advanced revenue management and maximize efficiencies around revenue assurance and fraud management. The new version of the ROC builds on this capability to enable an operator to adopt Operational Assurance, gaining better understanding and control over how operations support critical business goals. Demonstrations of the ROC will take place at the Subex booth and in the ‘Content Encounter II' a Catalyst demonstration program covering emerging best practices and techniques for delivering advanced content-based services.
The company also is taking part in a Catalyst project highlighting an end-to-end B/OSS Framework for streamlining and standardising the processes of bringing new telecom products to market, using Syndesis Controlle. The project will demonstrate concept-to-market and order fulfillment processes, as well as order and trouble ticket fall-out management.
Subex will also launch its WiMAX-enabled Syndesis Express solution, designed to help operators to quickly and efficiently define and deliver value-added, next- generation services, like VolP and IPTV, over WiMAX. Also at Management World, Subex will launch Optima 4.6, the new version of its route optimization system, a part of its revenue maxmization offerings, designed to help service providers to create optimized route plans for automatic switch upload as well as facilitating a full reporting suite for data analysis.
In addition to the above, Subex’s CTO, Mark Nicholson will be chairing a presentation track on Strategies & Solutions for monetizing digital media services to held be on May 20. Subex also will present on the topic of revenue assurance for next generation services, providing insights on proactively identifying, analyzing and implementing scalable revenue integrity solutions to maximize revenue.
Subex is known around the world as a leader in revenue maximization and fulfillment solutions that enables communications service providers to achieve their business objectives. Its industry leading products help service operators gain that competitive advantage in quickly rolling out services, while mitigating costs, through the concept of operational assurance. The company has a significant presence in all the leading telecom markets of the world, Mark Nicholson was also recently appointed as advisory director on the TM Forum board.
Management World 2008 is the annual global event for the management of information, communications and entertainment services organised by TM Forum, the world’s leading trade consortium focused on enabling digital services.
Link to the article: http://www.ndtvprofit.com/2008/05/19165106/Subex-unveils-groundbreaking-n.html
Subex - Subex launches Optima 4.6 to help telecom operators to make efficient and informed call routing decisions
Subex Ltd, a leading global provider of Operations and Business Support Systems (OSS / BSS) for communications service providers, today announced the launch of OptimaTM 4.6, a new version of its Route Optimization system designed to help service providers to create optimized route plans for automatic switch upload as well as facilitating a full reporting suite for data analysis.
The latest version of Optima supports Oracle Database 10g, one of the most widely deployed enterprise databases in the industry. Additional enhancements also include localization to support multiple languages, switch interface support for Nortel DMS-300, and percentage-based volume agreements.
Anuradha, Senior VP - Engineering, Subex Ltd said 'Optima is an end-to-end Route Optimization solution that is modular in design and provides service providers with the ability to quickly adapt to changing operational requirements.
Optima's modularity reduces initial system costs and allows additional modules to be easily added at a later date, as the business grows." Optima is part of the Rocware suite of solutions, supporting the concept of the Revenue Operations Center (ROC) - a consolidated framework of systems that enables advanced revenue management, cost control and profit enhancement.
Subex is the trusted partner of communications service providers around the world seeking to achieve enhanced operational dexterity, offering rapid and flexible delivery of innovative new services while running lean operations. Subex's award-winning family of best-of-breed solutions is the foundation of the ROC, enabling operational assurance and, as a result, improved operational dexterity. At TM Forum Management World Nice, May 20-22, Subex will demonstrate a ROC as part of the Content Encounter II Catalyst project, the premier demonstration of the delivery of advanced, content-based services involving Tier 1 operators from around the world.
Link to the article: http://www.equitybulls.com/admin/news2006/news_det.asp?id=30612
The latest version of Optima supports Oracle Database 10g, one of the most widely deployed enterprise databases in the industry. Additional enhancements also include localization to support multiple languages, switch interface support for Nortel DMS-300, and percentage-based volume agreements.
Anuradha, Senior VP - Engineering, Subex Ltd said 'Optima is an end-to-end Route Optimization solution that is modular in design and provides service providers with the ability to quickly adapt to changing operational requirements.
Optima's modularity reduces initial system costs and allows additional modules to be easily added at a later date, as the business grows." Optima is part of the Rocware suite of solutions, supporting the concept of the Revenue Operations Center (ROC) - a consolidated framework of systems that enables advanced revenue management, cost control and profit enhancement.
Subex is the trusted partner of communications service providers around the world seeking to achieve enhanced operational dexterity, offering rapid and flexible delivery of innovative new services while running lean operations. Subex's award-winning family of best-of-breed solutions is the foundation of the ROC, enabling operational assurance and, as a result, improved operational dexterity. At TM Forum Management World Nice, May 20-22, Subex will demonstrate a ROC as part of the Content Encounter II Catalyst project, the premier demonstration of the delivery of advanced, content-based services involving Tier 1 operators from around the world.
Link to the article: http://www.equitybulls.com/admin/news2006/news_det.asp?id=30612
Subex - launches WiMAX-enabled fulfillment solution
Bangalore-based Subex today announced the availability of its wimax-enabled Syndesis Express solution, designed to help operators to quickly and efficiently define and deliver value-added, next-generation services, like VoIP and IPTV, over WiMAX.
Syndesis Express, a pre-integrated solution bundle that provides subscriber-centric fulfillment for high-speed internet, IPTV, VoIP and other advanced service offerings, now allows service providers to seamlessly introduce and automate the delivery of WiMAX-based services to their customers, across multi-vendor, multi-technology networks.
``Service providers are looking for new ways of bridging the last mile to the customer for residential and enterprise broadband services and WiMAX is gaining increasing acceptance as an access technology,`` said Mark Nicholson, CTO of Subex.
Link to the article: http://www.myiris.com/newsCentre/newsPopup.php?fileR=20080515120921130&dir=2008/05/15&secID=livenews
Syndesis Express, a pre-integrated solution bundle that provides subscriber-centric fulfillment for high-speed internet, IPTV, VoIP and other advanced service offerings, now allows service providers to seamlessly introduce and automate the delivery of WiMAX-based services to their customers, across multi-vendor, multi-technology networks.
``Service providers are looking for new ways of bridging the last mile to the customer for residential and enterprise broadband services and WiMAX is gaining increasing acceptance as an access technology,`` said Mark Nicholson, CTO of Subex.
Link to the article: http://www.myiris.com/newsCentre/newsPopup.php?fileR=20080515120921130&dir=2008/05/15&secID=livenews
IVRCL
IVRCL: The strong business momentum of IVRCL is expected to be driven by an order backlog of Rs.110bn which is 4.75x FY07 sales. Water continues to dominate the revenue of the company which is closely followed by building and industrial infrastructure space. Water and environment forms the lions share at 59.1% followed by building and industrial infrastructure at 18.2%, transportation at 13.6% and power & distribution at 9.1%. IVRCL has reported strong growth in its topline and bottom line for the past few years. Income grew at a CAGR of 43.9% during FY2004-2007 and stood at Rs.23.13bn at the end of Mar 31, 2007. During the same period, cost of construction expenses grew at a CAGR of 42.4% to Rs.19.5bn in FY07. This resulted in PBT and PAT growing at a CAGR of 76.1% and 53.4% to Rs.1.85bn and Rs.1.41bn respectively during the same period. IVRCL recorded revenue of Rs.23.44bn for the nine months ended December 31, 2007 as compared to Rs.13.22bn during the same period last year representing robust growth of 78.2%. Operating margins of the company stood at 9.82% for the first nine months of 2008 and was lower as compared to 9.92% recorded for 9MFY2007 due to increase in raw material prices of various inputs like cement and steel. We initiate our coverage of IVRCL with a Buy rating and value IVRCL’s share at an intrinsic value of Rs.470.06 based on Sum of the Parts valuation method. The intrinsic value is higher than the current market price of Rs.413.5 (as on April 28, 2008) by 13.68%.
Wednesday, May 14, 2008
Wockhardt - Wockhardt CFO found guilty of insider trading
It's the first in Indian corporate history that a company CFO has been charged and indicted of insider trading: Rajiv Gandhi, Director-Corporate Finance and Company Secretary of one of India's leading pharmaceutical companies-Wockhardt.
The Securities Appelate Tribunal, or SAT, has upheld a November 2006 Sebi order that charged Wockhardt CFO Rajiv Gandhi, his wife and his sister of insider trading.
The Tribunal's order states, “We uphold the appelants guilty of insider trading."
Whilst this is not India's first insider trading case, it is by far unique because the accused is part of the company's senior management and Wockhardt is an over Rs 2,600 crore giant.
Who is Rajiv Gandhi?
He is a Wockhardt board member and is instrumental in the demerger of group companies. He is responsible for all mergers and acquisitions and was a Wockhardt employee for over 10 years.
His key deals include the buyout of Pinewood (Ireland), Negma Labs (France) and Morton Grove (USA). He was also instrumental in negotiating the Andrx buyout.
Wockhardt issued a statement saying, “We are considering/studying the judgement and its implications. We will take appropriate measures after thorough review and investigation."
Modus Operandi:
Gandhi's wife and sister traded in Wockhardt shares. They traded prior to important financial events.
On January 21, 1999, there was a Wockhardt Board meet on results and interim dividend at 5pm. Wife Sandhya and sister Amishi Gandhi sold 2,100 shares at 2:37 pm and 2:42 pm.
On January 22, 1999, the company announced results and interim dividend pre-trading. Amishi and Sandhya Gandhi sold 1,500 shares at 9.59 am and 10.04 am.
On April 22, 1999, the board meeting on results and demerger took place at 11.30 am. Amishi Gandhi sold 1,200 shares at 11.33 am.
The Sebi order of November 2006 quoted trading patterns from January to October 1999. It found Rajiv, Sandhya and Amishi Gandhi guilty of insider trading and imposed a penalty of Rs 5 lakh in 2006.
The SAT order of May 2007 alleged that appelants traded in the scrip before and after board meetings held to consider financial results. The trades were executed on the basis of price sensitive information not available to investors in general.
Road ahead for Gandhi:
Somashekhar Sundaresan of J Sagar Associates, cousel for Rajiv Gandhi, said this did not constitute insider trading and would be appealing against the order in the Supreme Court. “Our position is quite different. This did not constitute insider trading. We are talking about transactions that happened in 1999. You are asking me a question with the perspective of a new law that came in 2002. We have just got the order and are reading it. There is a statutory right to appeal and I cannot really get around into discussing the merits of the case. But we will surely be filing an appeal in the Supreme Court.”
On the standards of corporate governance in this country, Sundaresan said, “I am not at liberty to discuss that. That is a question you should ask the company. Our defence has been that the facts as they are, applying the law as it stood, does not constitute insider trading.”
Link to the article: http://www.moneycontrol.com/india/news/business/wockhardt-cfo-found-guiltyinsider-trading/16/36/337990
The Securities Appelate Tribunal, or SAT, has upheld a November 2006 Sebi order that charged Wockhardt CFO Rajiv Gandhi, his wife and his sister of insider trading.
The Tribunal's order states, “We uphold the appelants guilty of insider trading."
Whilst this is not India's first insider trading case, it is by far unique because the accused is part of the company's senior management and Wockhardt is an over Rs 2,600 crore giant.
Who is Rajiv Gandhi?
He is a Wockhardt board member and is instrumental in the demerger of group companies. He is responsible for all mergers and acquisitions and was a Wockhardt employee for over 10 years.
His key deals include the buyout of Pinewood (Ireland), Negma Labs (France) and Morton Grove (USA). He was also instrumental in negotiating the Andrx buyout.
Wockhardt issued a statement saying, “We are considering/studying the judgement and its implications. We will take appropriate measures after thorough review and investigation."
Modus Operandi:
Gandhi's wife and sister traded in Wockhardt shares. They traded prior to important financial events.
On January 21, 1999, there was a Wockhardt Board meet on results and interim dividend at 5pm. Wife Sandhya and sister Amishi Gandhi sold 2,100 shares at 2:37 pm and 2:42 pm.
On January 22, 1999, the company announced results and interim dividend pre-trading. Amishi and Sandhya Gandhi sold 1,500 shares at 9.59 am and 10.04 am.
On April 22, 1999, the board meeting on results and demerger took place at 11.30 am. Amishi Gandhi sold 1,200 shares at 11.33 am.
The Sebi order of November 2006 quoted trading patterns from January to October 1999. It found Rajiv, Sandhya and Amishi Gandhi guilty of insider trading and imposed a penalty of Rs 5 lakh in 2006.
The SAT order of May 2007 alleged that appelants traded in the scrip before and after board meetings held to consider financial results. The trades were executed on the basis of price sensitive information not available to investors in general.
Road ahead for Gandhi:
Somashekhar Sundaresan of J Sagar Associates, cousel for Rajiv Gandhi, said this did not constitute insider trading and would be appealing against the order in the Supreme Court. “Our position is quite different. This did not constitute insider trading. We are talking about transactions that happened in 1999. You are asking me a question with the perspective of a new law that came in 2002. We have just got the order and are reading it. There is a statutory right to appeal and I cannot really get around into discussing the merits of the case. But we will surely be filing an appeal in the Supreme Court.”
On the standards of corporate governance in this country, Sundaresan said, “I am not at liberty to discuss that. That is a question you should ask the company. Our defence has been that the facts as they are, applying the law as it stood, does not constitute insider trading.”
Link to the article: http://www.moneycontrol.com/india/news/business/wockhardt-cfo-found-guiltyinsider-trading/16/36/337990
IVRCL
IVRCL — (IVRCL.NS, I-OW; PT INR593)
Water projects dominate its order book; should benefit from irrigation opportunities
IVRCL has a predominant position in effluent treatment, water supply, sanitation and
irrigation-related projects. About half of its water-related order book is made up of irrigation
projects, with the Andhra Pradesh Irrigation Scheme being the key. At 58%, water projects
form a bulk of its order book of INR110 billion as of fiscal year 3Q08. We estimate strong
order inflows growth in this segment, given the high investment outlay in India’s irrigation
and water sectors for the next five years.
Other sectors to contribute as well
IVRCL has also expanded substantially into other segments such as power and roads and
buildings. Roads and buildings account for 11% and 21% of the order book, respectively,
while the transmission & distribution (T&D) segment accounting for 9% of the order book.
Robust investment planned in these three sectors over the next five years should help IVRCL
improve its order inflows.
Robust subsidiary businesses
! IVR Prime, the real estate subsidiary of IVRCL, currently has about a 85-million-squarefoot
area under development in seven different cities.
! The acquired Hindustan Dorr Oliver (HDO), which has engineering and design skills in
water projects, registered revenue CAGR of 40% during FY04-FY07.
! In the build-operate-transfer (BOT) space, IVRCL currently has three road projects and
one water desalination project. So far, the company has invested around INR2.6
billion as equity in these projects. It is the first company to develop a water
desalination project on a BOT basis.
We estimate strong growth in order inflows:
! We expect order inflows to register a CAGR of 31% during FY07-FY10. We expect
total order inflows over FY08-FY10 to be around INR259 billion versus INR113 billion
for the past three years.
! We project revenue CAGR of 41% over FY07-FY10.
! We estimate core EBITDA margins to expand from 10% in FY07 to 11.1% in FY10.
! We project an earnings CAGR of 40% over the next three years. Our EPS estimates
for FY08, FY09 and FY10 are INR13.9, INR20.8, and INR28.8, respectively.
India Infrastructure and Construction
March 25, 2008 5
! We estimate ROE to reach 12% in FY08 and 18% by FY10, up from 11% in FY07. If
we were to adjust for investments in subsidiaries, IVRCL’s ROE would expand from
13.6% in FY07 to about 20.6% by FY10.
! The total funds requirement by IVRCL over FY08-FY10 is close to INR16 billion
(including negative operating cash flows of INR11.5 billion). As the debt-equity ratio
of IVRCL is at 0.25x, we are building in a debt of INR15 billion over the next three
years to fund the capital requirement.
Initiate with a 1-Overweight rating and a 12-month price target of INR593
We value IVRCL using the sum-of-the-parts (SOTP) methodology. For its core construction
business, we value it at a P/E multiple of 17x on our FY09E earnings. We value IVR Prime
using the discounted cash flow (DCF) methodology. For its BOT portfolio, we value the
projects on respective P/B multiples.
Figure 1: IVRCL valuation
Segment March 2009 value (INR mn) Value per share INR Comment
Core construction business 53,783 399 17x on our FY09 earnings
IVR Prime 18,007 134 Valued on NPV basis
BOT Portfolio 5,657 42 Multiple to book
Hindustan Dorr Oliver 2,484 18 15x on our FY09 earnings
Total 79,931 593
Source: Lehman Brothers estimates
Based on our SOTP valuation, we have a 1-Overweight rating on IVRCL and a 12-month
price target of INR593, representing potential upside of 72% from the current levels.
Water projects dominate its order book; should benefit from irrigation opportunities
IVRCL has a predominant position in effluent treatment, water supply, sanitation and
irrigation-related projects. About half of its water-related order book is made up of irrigation
projects, with the Andhra Pradesh Irrigation Scheme being the key. At 58%, water projects
form a bulk of its order book of INR110 billion as of fiscal year 3Q08. We estimate strong
order inflows growth in this segment, given the high investment outlay in India’s irrigation
and water sectors for the next five years.
Other sectors to contribute as well
IVRCL has also expanded substantially into other segments such as power and roads and
buildings. Roads and buildings account for 11% and 21% of the order book, respectively,
while the transmission & distribution (T&D) segment accounting for 9% of the order book.
Robust investment planned in these three sectors over the next five years should help IVRCL
improve its order inflows.
Robust subsidiary businesses
! IVR Prime, the real estate subsidiary of IVRCL, currently has about a 85-million-squarefoot
area under development in seven different cities.
! The acquired Hindustan Dorr Oliver (HDO), which has engineering and design skills in
water projects, registered revenue CAGR of 40% during FY04-FY07.
! In the build-operate-transfer (BOT) space, IVRCL currently has three road projects and
one water desalination project. So far, the company has invested around INR2.6
billion as equity in these projects. It is the first company to develop a water
desalination project on a BOT basis.
We estimate strong growth in order inflows:
! We expect order inflows to register a CAGR of 31% during FY07-FY10. We expect
total order inflows over FY08-FY10 to be around INR259 billion versus INR113 billion
for the past three years.
! We project revenue CAGR of 41% over FY07-FY10.
! We estimate core EBITDA margins to expand from 10% in FY07 to 11.1% in FY10.
! We project an earnings CAGR of 40% over the next three years. Our EPS estimates
for FY08, FY09 and FY10 are INR13.9, INR20.8, and INR28.8, respectively.
India Infrastructure and Construction
March 25, 2008 5
! We estimate ROE to reach 12% in FY08 and 18% by FY10, up from 11% in FY07. If
we were to adjust for investments in subsidiaries, IVRCL’s ROE would expand from
13.6% in FY07 to about 20.6% by FY10.
! The total funds requirement by IVRCL over FY08-FY10 is close to INR16 billion
(including negative operating cash flows of INR11.5 billion). As the debt-equity ratio
of IVRCL is at 0.25x, we are building in a debt of INR15 billion over the next three
years to fund the capital requirement.
Initiate with a 1-Overweight rating and a 12-month price target of INR593
We value IVRCL using the sum-of-the-parts (SOTP) methodology. For its core construction
business, we value it at a P/E multiple of 17x on our FY09E earnings. We value IVR Prime
using the discounted cash flow (DCF) methodology. For its BOT portfolio, we value the
projects on respective P/B multiples.
Figure 1: IVRCL valuation
Segment March 2009 value (INR mn) Value per share INR Comment
Core construction business 53,783 399 17x on our FY09 earnings
IVR Prime 18,007 134 Valued on NPV basis
BOT Portfolio 5,657 42 Multiple to book
Hindustan Dorr Oliver 2,484 18 15x on our FY09 earnings
Total 79,931 593
Source: Lehman Brothers estimates
Based on our SOTP valuation, we have a 1-Overweight rating on IVRCL and a 12-month
price target of INR593, representing potential upside of 72% from the current levels.
Jaiprakash - Jaiprakash gets land for Taj Expressway
Jaiprakash Associates is learnt to have acquired the entire 165 kilometres of land it needs to build an expressway between Greater Noida and Agra. The company earlier had only 7.2 kilometres of land in its possession, a company executive said.
Jaiprakash Associates is building the 165-kilometre-long Taj Expressway through the majority-owned unit Jaiprakash Infratech Ltd, created specially for implementation of the project.
Bharat Parekh, Reena Verma Bhasin and Joseph Jacobelli, Merrill Lynch analysts, said the entire 165 kilometres of land was acquired last week.
Jaiprakash Associates organised a roadshow for US investors last week to highlight the acquisition.
“This (the land acquisition) should create the room to boost engineering and construction revenues from the second half the fiscal year 2008-09,” the Merrill analysts said in a note Tuesday.
The company is also likely to get about 160 acres of land for real estate development at Noida next week, taking the total to 1075 acres along the expressway, the note said. “This will help Jaiprakash Infratech secure 39% of the Merrill Lynch estimate of the SPV value,” it said.
Jaiprakash Infratech’s director in-charge Sameer Gaur and Jaiprakash Associates’ executive chairman Manoj Gaur were unavailable for comment.
Earlier in March, Jaiprakash Associates raised Rs 250 crore by selling 1% stake in Jaiprakash Infratech to ICICI Bank, valuing the special purpose vehicle at Rs 25,000 crore. The company also secured a long term loan of Rs 900 crore from ICICI Bank.
The money will most likely be used by the company to construct the access-controlled expressway. Jaiprakash Infratech will develop, construct and operate the expressway on a tolled basis.
Jaypee Infratech also has the rights to develop 2.5 crore square metres of land along the expressway for commercial, residential, amusement, industrial and institutional purposes.
Jaiprakash Associates has also been awarded a contract by the Uttar Pradesh Development Authority to build a 1,047-km long expressway connecting Greater Noida to Balliya in the state. The company has deposited Rs 1,491 crore as a bank guarantee for the project. Jaypee Associates will execute the 1,047-km long Ganga Expressway project through its unit Jaypee Ganga Infrastructure Corp.
Link to the article: http://finance.indiainfo.com/2008/05/14/0805140913_jaiprakash-taj_expressway.html
Jaiprakash Associates is building the 165-kilometre-long Taj Expressway through the majority-owned unit Jaiprakash Infratech Ltd, created specially for implementation of the project.
Bharat Parekh, Reena Verma Bhasin and Joseph Jacobelli, Merrill Lynch analysts, said the entire 165 kilometres of land was acquired last week.
Jaiprakash Associates organised a roadshow for US investors last week to highlight the acquisition.
“This (the land acquisition) should create the room to boost engineering and construction revenues from the second half the fiscal year 2008-09,” the Merrill analysts said in a note Tuesday.
The company is also likely to get about 160 acres of land for real estate development at Noida next week, taking the total to 1075 acres along the expressway, the note said. “This will help Jaiprakash Infratech secure 39% of the Merrill Lynch estimate of the SPV value,” it said.
Jaiprakash Infratech’s director in-charge Sameer Gaur and Jaiprakash Associates’ executive chairman Manoj Gaur were unavailable for comment.
Earlier in March, Jaiprakash Associates raised Rs 250 crore by selling 1% stake in Jaiprakash Infratech to ICICI Bank, valuing the special purpose vehicle at Rs 25,000 crore. The company also secured a long term loan of Rs 900 crore from ICICI Bank.
The money will most likely be used by the company to construct the access-controlled expressway. Jaiprakash Infratech will develop, construct and operate the expressway on a tolled basis.
Jaypee Infratech also has the rights to develop 2.5 crore square metres of land along the expressway for commercial, residential, amusement, industrial and institutional purposes.
Jaiprakash Associates has also been awarded a contract by the Uttar Pradesh Development Authority to build a 1,047-km long expressway connecting Greater Noida to Balliya in the state. The company has deposited Rs 1,491 crore as a bank guarantee for the project. Jaypee Associates will execute the 1,047-km long Ganga Expressway project through its unit Jaypee Ganga Infrastructure Corp.
Link to the article: http://finance.indiainfo.com/2008/05/14/0805140913_jaiprakash-taj_expressway.html
Tuesday, May 13, 2008
IVRCL - target price of Rs570
IVRCL Infrastructure—expect moderation in execution in 4QFY08 after >70%
growth in 9mFY08, marginally revise estimates, maintain BUY
We expect IVRCL to report revenues of Rs13.6, a yoy growth of 37% versus 9MFY08
growth of over 78%. We believe that yoy growth in 4QFY08 is likely to be lower led by
(1) more even spread of revenues and (2) base effects with very strong yoy growth in
4QFY07 also.
We have revised our execution estimates for FY2009E and FY2010E to Rs50.4 bn and
Rs69.5 bn from Rs49 bn and Rs70.7 bn earlier, based on more even distribution of
execution growth. We have revised our EPS estimate for FY2009E and FY2010E to
Rs20.6 and Rs27.4 from Rs20.4 and Rs31.4 earlier. We expect flat margins in FY2009E
and FY2010E of 10.3%. We maintain our target price of Rs570 comprised of (1) Rs413
for the core construction business, (2) Rs112 for IVR Prime, (3) Rs15 for Hindustan Dorr
Oliver and (4) Rs39 for BOTs and infrastructure holdings (Exhibit 6). Our valuation of
core construction business implies 14X FY2010E earnings (Exhibit 7). We highlight that
IVRCL had a visibility of 2.6 years at the end of 9mFY08 based on forward four quarter
revenues (Exhibits 6, 7 and 8).
growth in 9mFY08, marginally revise estimates, maintain BUY
We expect IVRCL to report revenues of Rs13.6, a yoy growth of 37% versus 9MFY08
growth of over 78%. We believe that yoy growth in 4QFY08 is likely to be lower led by
(1) more even spread of revenues and (2) base effects with very strong yoy growth in
4QFY07 also.
We have revised our execution estimates for FY2009E and FY2010E to Rs50.4 bn and
Rs69.5 bn from Rs49 bn and Rs70.7 bn earlier, based on more even distribution of
execution growth. We have revised our EPS estimate for FY2009E and FY2010E to
Rs20.6 and Rs27.4 from Rs20.4 and Rs31.4 earlier. We expect flat margins in FY2009E
and FY2010E of 10.3%. We maintain our target price of Rs570 comprised of (1) Rs413
for the core construction business, (2) Rs112 for IVR Prime, (3) Rs15 for Hindustan Dorr
Oliver and (4) Rs39 for BOTs and infrastructure holdings (Exhibit 6). Our valuation of
core construction business implies 14X FY2010E earnings (Exhibit 7). We highlight that
IVRCL had a visibility of 2.6 years at the end of 9mFY08 based on forward four quarter
revenues (Exhibits 6, 7 and 8).
Dwarikesh - Buy Dwarikesh Sugar tgt Rs 95
PINC has maintained buy rating on Dwarikesh Sugar Industries with target price of Rs 95 in its May 13, 2008 report. "Dwarikesh Sugar Industries Ltd.’s (DSIL) net sales surged by 36% YoY to Rs866 million in Q2FY08. Commissioning of Dwarikesh Dham unit (7,500 TCD and 24 MW saleable cogen) and 24 MW cogen unit at Dwarikesh Puram were the key reasons for the sales growth. Sugar volumes rose by 27% to 37.5k mt whereas realisations were down by 2% YoY and up by 4% QoQ to Rs13.8k/mt. The other key development was the commissioning of its 24 MW each cogen plants at Dwarikesh Dham and Dwarikesh Puram in Feb’08, which were postponed on account of delays in installing evacuation lines from power plants to the state grid. The future profitability of the company will come primarily from its 56 MW (saleable) cogen power plants. This, coupled with firm sugar prices is likely to boost the company’s margins and improve its cash flows. Hence, we maintain our ‘BUY’ recommendation with a price target of Rs 95 (as against our earlier target of Rs 130) on an investment perspective of one year" according to PINC report.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Source: Moneycontrol.com
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Source: Moneycontrol.com
Sunday, May 11, 2008
Bargain stocks
A combination of value and growth helps in achieving healthy returns, yet keeping the margin of safety.
The Indian markets had fallen by almost 30 per cent between January and March, 2008. Since then, they have recovered half the lost ground. The impact of the fall was so hard that many stocks were beaten down to levels disproportionate with their fundamentals and growth prospects.
Interestingly, even as the markets have risen, many stocks are still quoting well below their worth and provide investment opportunities.
The ways of identifying value stocks are many, including looking at ratios like price-to-earnings (PE) and price-to-book-value (P/BV) besides, factors like replacement cost and dividend yields. But if factors like company management and track record, healthy growth prospects and sound business model, are also considered, it only increases the margin of safety.
To put it differently, a low PE or low P/BV does not necessarily mean cheap but, it only helps in keeping a lid on the price one pays vis-Ã -vis a company's past earnings or book-value. Thus, it makes sense to look for stocks that offer a good combination of value and growth.
In a bid to identify such stocks, the Smart Investor looked at companies by considering factors like market capitalisation (over Rs 250 crore), PE (under 15), financials, return ratios and cash flows (should be positive).
While companies with a dividend track record were preferred, their growth prospects were given utmost importance.
Many of these companies are from sectors that have underperformed in the past (even before the markets crashed) due to different reasons, including change in macro environment and cost pressures, which typically, are not permanent in nature.
This also means that the worst is already reflecting in their stock valuations. And, since the long-term growth prospects of most of these companies look healthy, there is potential for their stocks to deliver decent returns.
Apart from the companies mentioned below (See Value Buys), there are many public sector banks that are quoting at a good discount to their true values.
Additionally, stocks like Aurobindo Pharmaceuticals, LIC Housing Finance, Wanbury and Lok Housing, which are quality buys, continue to look good and merit attention.
Alok Industries
In the last four years, Alok Industries has taken advantage of the textile upgradation fund (TUF) to backward integrate (from yarn to home textiles and apparels) as well as expanded capacities in a big way.
The fruits are visible in its numbers including the healthy operating profit margins (22-25 per cent in the last eight quarters).
The last phase of the expansion will get commissioned over by March 2009, and should help sustain revenue and profit growth in excess of 20-25 per cent in the next two years. The company's focus on value-added products and thrust on retailing should also help maintain profit margins.
In the retail space, Alok is consolidating all its activities under Alok Homes & Apparels, where it is targeting to operate 400 stores (20 now) over the next two years.
Alok is also looking at real estate as agrowth driver, wherein it has signed up for a few projects (a township in Vapi, a million sq ft commercial project in Bhandup (Mumbai) and two projects in Central Mumbai).
In a bid to mitigate risks, it has chosen the joint venture route and aims to be selective with focus on large projects.
Among key risk factors is the high leverage (but, largely low-cost loans under TUF), which should gradually come down as the last phase of expansion starts contributing, post the conversion of two crore warrants into shares (at Rs 102 per share) over next 15 months and a planned private equity placement (in 1-2 months).
To sum up, Alok should report robust growth rates over the next two years, while additional triggers will come from the progress in real estate and retail businesses. At Rs 68, the stock trades at 6 times its estimated FY09 earnings.
Amtek India
Amtek India manufactures castings and machined auto components for companies. Like others, Amtek too, has been facing input costs pressures.
For quarter ended March 2008, operating profits grew at a slower pace as compared to revenue growth. Analysts though say that the company has cost escalation clause with its customers and is already negotiating for price hikes.
Over the years, Amtek India has done backward integration to emerge as a fully integrated castings player. It is now expanding its foundry capacity by 60 per cent, which will go on stream by 2008-09.
Besides, Amtek is shifting capacity (45,000 tonnes) of its subsidiary Sigmacast, UK to its Indian facilities this year, which will lead to better utilisation of the assets and expand operating margins due to lower costs in India.
These moves should help sustain volume and earnings growth of over 15 per cent for the next two years.
Funding its expansion and inorganic growth plans is not an issue, given the low leverage, cash and bank balance of Rs 265 crore, and the sale of its stake in a group company in April 2008 for about Rs 300 crore. The stock quotes at just one time its book-value and at a PE of 8 times it's estimated FY09 earnings.
Grasim
Including its subsidiary, Ultratech, cement accounts for 70 per cent of Grasim Industries' consolidated revenues followed by viscose staple fibre, sponge iron and textiles.
Currently, higher input prices across its businesses has seen its operating profit grow at a slower pace than revenue growth in Q4 FY08. Not surprisingly, the stock has underperformed the Sensex by a huge margin; valuations are now close to historical lows.
While the near-term outlook is not exciting, Grasim's expanded cement capacities (6.6 million tonnes per annum commissioned recently and another 2.7 MTPA expected by December 2008) will result in strong volume growth over the next 18 months, whereas cost rationalisation measures should help report a reasonable growth in profits. Capacity expansion in other businesses too, has been taken up and should contribute to the kitty.
Notably, Grasim is among few cement companies that will have the advantage of early commissioning of capacities, given that an over supply situation is expected by end-2009. Some analysts though expect that project delays by players may postpone any possible glut situation to 2010.
All these indicate that Grasim is well placed to shore up volumes across its businesses, while its earnings should grow by 12-15 per cent annually over the next two years (estimated EPS of Rs 320, PE of 7.5 for FY09). And, if there is any realignment (reduction) in excise duty rates, it will only provide a boost to the industry's volumes.
As per analysts' estimates, the stock is quoting below the combined replacement cost of its businesses. Based on its growth prospects too, the stock is being valued between Rs 2,950-3,100. In short, Grasim has the potential to deliver good returns, as it rises to its true value.
HPCL
Quite an exception to the other four stocks, going purely by numbers, this one needs little brains to call it a value play; HPCL's stock quotes below its book value and its dividend yield is 7.3 per cent.
The reasons for the same, too, are well known. While the situation is unlikely to change any time soon or may not change at all, this stock is for those with an extraordinary high level of patience and an appetite for risk.
The dividend yield may also not hold this year as it is based on last year's dividend (2006-07). But, even if turns out to be lower considering that Hindustan Petroleum Corporation (HPCL) has reported a 26 per cent decline in net profit at Rs 750.37 crore (annualised EPS of Rs 29.5) for nine months ended December 2007, it would still be decent. The other risk relates to the assumption that the subsidy burden does not increase in future.
Regards its business, among long-term drivers is the company's investment (10-20 per cent stake) in 21 exploration & production blocks in consortium with other companies besides, some with ONGC.
The company also owns a 16.95 per cent stake (29.72 crore shares) in MRPL worth Rs 2902 crore or Rs 85 per share of HPCL. Adjusting for this, the stock quotes at a PE of 5.4 times its estimated FY09 earnings.
Royal Orchid Hotels
Most of hotel stocks have underperformed the broader markets in the last one year and, Royal Orchid Hotels is not exception. In fact, its stock performance has been relatively worse, thanks to subdued growth in revenues and marginal dip (by 5 per cent) in profits in the nine months ended December 2007. This may be attributed to its presence, primarily in Bangalore (80 per cent of revenues)–four out of its 10 hotels are in the city, including a 200-room 5-star business hotel and a 200-room 4-star business hotel. Bangalore has seen room rents remain stable to weak in the recent past.
However, the new international airport, increasing international events, development of new convention centres and corporate conferences (like held by Microsoft and IBM) could provide some triggers to drive demand in the future.
Overall, the company has 10 hotels with an inventory of about 830 rooms in Bangalore, Mysore, Pune and Jaipur. Positively, by 2009, it will also have presence in Hyderabad, Shimla, Delhi, Noida and Mumbai (includes foray into budget hotels category), which in turn should mitigate the concentration risk.
Last month, the company acquired a 50 per cent stake for Rs 17 crore in a company that owns a 65-room beach resort in Goa.
The company plans to spend Rs 10 crore towards renovating the property, which is expected to be completed by October 2008 thus, indicating that the time-lag to its revenue contribution will be minimal.
At a one-year forward PE of 7 and a reasonably high dividend yield of 5.8 per cent, and considering its growth prospects, the stock can deliver good returns in a year's time.
Link to the article: http://www.business-standard.com/common/news_article.php?leftnm=lmnu6&subLeft=2&autono=322613&tab=r
The Indian markets had fallen by almost 30 per cent between January and March, 2008. Since then, they have recovered half the lost ground. The impact of the fall was so hard that many stocks were beaten down to levels disproportionate with their fundamentals and growth prospects.
Interestingly, even as the markets have risen, many stocks are still quoting well below their worth and provide investment opportunities.
The ways of identifying value stocks are many, including looking at ratios like price-to-earnings (PE) and price-to-book-value (P/BV) besides, factors like replacement cost and dividend yields. But if factors like company management and track record, healthy growth prospects and sound business model, are also considered, it only increases the margin of safety.
To put it differently, a low PE or low P/BV does not necessarily mean cheap but, it only helps in keeping a lid on the price one pays vis-Ã -vis a company's past earnings or book-value. Thus, it makes sense to look for stocks that offer a good combination of value and growth.
In a bid to identify such stocks, the Smart Investor looked at companies by considering factors like market capitalisation (over Rs 250 crore), PE (under 15), financials, return ratios and cash flows (should be positive).
While companies with a dividend track record were preferred, their growth prospects were given utmost importance.
Many of these companies are from sectors that have underperformed in the past (even before the markets crashed) due to different reasons, including change in macro environment and cost pressures, which typically, are not permanent in nature.
This also means that the worst is already reflecting in their stock valuations. And, since the long-term growth prospects of most of these companies look healthy, there is potential for their stocks to deliver decent returns.
Apart from the companies mentioned below (See Value Buys), there are many public sector banks that are quoting at a good discount to their true values.
Additionally, stocks like Aurobindo Pharmaceuticals, LIC Housing Finance, Wanbury and Lok Housing, which are quality buys, continue to look good and merit attention.
Alok Industries
In the last four years, Alok Industries has taken advantage of the textile upgradation fund (TUF) to backward integrate (from yarn to home textiles and apparels) as well as expanded capacities in a big way.
The fruits are visible in its numbers including the healthy operating profit margins (22-25 per cent in the last eight quarters).
The last phase of the expansion will get commissioned over by March 2009, and should help sustain revenue and profit growth in excess of 20-25 per cent in the next two years. The company's focus on value-added products and thrust on retailing should also help maintain profit margins.
In the retail space, Alok is consolidating all its activities under Alok Homes & Apparels, where it is targeting to operate 400 stores (20 now) over the next two years.
Alok is also looking at real estate as agrowth driver, wherein it has signed up for a few projects (a township in Vapi, a million sq ft commercial project in Bhandup (Mumbai) and two projects in Central Mumbai).
In a bid to mitigate risks, it has chosen the joint venture route and aims to be selective with focus on large projects.
Among key risk factors is the high leverage (but, largely low-cost loans under TUF), which should gradually come down as the last phase of expansion starts contributing, post the conversion of two crore warrants into shares (at Rs 102 per share) over next 15 months and a planned private equity placement (in 1-2 months).
To sum up, Alok should report robust growth rates over the next two years, while additional triggers will come from the progress in real estate and retail businesses. At Rs 68, the stock trades at 6 times its estimated FY09 earnings.
Amtek India
Amtek India manufactures castings and machined auto components for companies. Like others, Amtek too, has been facing input costs pressures.
For quarter ended March 2008, operating profits grew at a slower pace as compared to revenue growth. Analysts though say that the company has cost escalation clause with its customers and is already negotiating for price hikes.
Over the years, Amtek India has done backward integration to emerge as a fully integrated castings player. It is now expanding its foundry capacity by 60 per cent, which will go on stream by 2008-09.
Besides, Amtek is shifting capacity (45,000 tonnes) of its subsidiary Sigmacast, UK to its Indian facilities this year, which will lead to better utilisation of the assets and expand operating margins due to lower costs in India.
These moves should help sustain volume and earnings growth of over 15 per cent for the next two years.
Funding its expansion and inorganic growth plans is not an issue, given the low leverage, cash and bank balance of Rs 265 crore, and the sale of its stake in a group company in April 2008 for about Rs 300 crore. The stock quotes at just one time its book-value and at a PE of 8 times it's estimated FY09 earnings.
Grasim
Including its subsidiary, Ultratech, cement accounts for 70 per cent of Grasim Industries' consolidated revenues followed by viscose staple fibre, sponge iron and textiles.
Currently, higher input prices across its businesses has seen its operating profit grow at a slower pace than revenue growth in Q4 FY08. Not surprisingly, the stock has underperformed the Sensex by a huge margin; valuations are now close to historical lows.
While the near-term outlook is not exciting, Grasim's expanded cement capacities (6.6 million tonnes per annum commissioned recently and another 2.7 MTPA expected by December 2008) will result in strong volume growth over the next 18 months, whereas cost rationalisation measures should help report a reasonable growth in profits. Capacity expansion in other businesses too, has been taken up and should contribute to the kitty.
Notably, Grasim is among few cement companies that will have the advantage of early commissioning of capacities, given that an over supply situation is expected by end-2009. Some analysts though expect that project delays by players may postpone any possible glut situation to 2010.
All these indicate that Grasim is well placed to shore up volumes across its businesses, while its earnings should grow by 12-15 per cent annually over the next two years (estimated EPS of Rs 320, PE of 7.5 for FY09). And, if there is any realignment (reduction) in excise duty rates, it will only provide a boost to the industry's volumes.
As per analysts' estimates, the stock is quoting below the combined replacement cost of its businesses. Based on its growth prospects too, the stock is being valued between Rs 2,950-3,100. In short, Grasim has the potential to deliver good returns, as it rises to its true value.
HPCL
Quite an exception to the other four stocks, going purely by numbers, this one needs little brains to call it a value play; HPCL's stock quotes below its book value and its dividend yield is 7.3 per cent.
The reasons for the same, too, are well known. While the situation is unlikely to change any time soon or may not change at all, this stock is for those with an extraordinary high level of patience and an appetite for risk.
The dividend yield may also not hold this year as it is based on last year's dividend (2006-07). But, even if turns out to be lower considering that Hindustan Petroleum Corporation (HPCL) has reported a 26 per cent decline in net profit at Rs 750.37 crore (annualised EPS of Rs 29.5) for nine months ended December 2007, it would still be decent. The other risk relates to the assumption that the subsidy burden does not increase in future.
Regards its business, among long-term drivers is the company's investment (10-20 per cent stake) in 21 exploration & production blocks in consortium with other companies besides, some with ONGC.
The company also owns a 16.95 per cent stake (29.72 crore shares) in MRPL worth Rs 2902 crore or Rs 85 per share of HPCL. Adjusting for this, the stock quotes at a PE of 5.4 times its estimated FY09 earnings.
Royal Orchid Hotels
Most of hotel stocks have underperformed the broader markets in the last one year and, Royal Orchid Hotels is not exception. In fact, its stock performance has been relatively worse, thanks to subdued growth in revenues and marginal dip (by 5 per cent) in profits in the nine months ended December 2007. This may be attributed to its presence, primarily in Bangalore (80 per cent of revenues)–four out of its 10 hotels are in the city, including a 200-room 5-star business hotel and a 200-room 4-star business hotel. Bangalore has seen room rents remain stable to weak in the recent past.
However, the new international airport, increasing international events, development of new convention centres and corporate conferences (like held by Microsoft and IBM) could provide some triggers to drive demand in the future.
Overall, the company has 10 hotels with an inventory of about 830 rooms in Bangalore, Mysore, Pune and Jaipur. Positively, by 2009, it will also have presence in Hyderabad, Shimla, Delhi, Noida and Mumbai (includes foray into budget hotels category), which in turn should mitigate the concentration risk.
Last month, the company acquired a 50 per cent stake for Rs 17 crore in a company that owns a 65-room beach resort in Goa.
The company plans to spend Rs 10 crore towards renovating the property, which is expected to be completed by October 2008 thus, indicating that the time-lag to its revenue contribution will be minimal.
At a one-year forward PE of 7 and a reasonably high dividend yield of 5.8 per cent, and considering its growth prospects, the stock can deliver good returns in a year's time.
Link to the article: http://www.business-standard.com/common/news_article.php?leftnm=lmnu6&subLeft=2&autono=322613&tab=r
Friday, May 9, 2008
Jaiprakash - Investor's Eye Sharekhan
Jaiprakash Associates
Cluster: Ugly Duckling
Recommendation: Buy
Price target: Rs390
Current market price: Rs269
Results above expectations
Result highlights
Jaiprakash Associates Ltd (JAL) Q4FY2008 results were above our estimates. On a standalone basis the company reported a top line growth of 44.5% year on year (yoy) to Rs1,280 crore. This was on account of a 45.7% year-on-year (y-o-y) growth in the revenues from the construction division to Rs475 crore. The higher revenue was also aided by the revenue from the real estate division, which stood at Rs256 crore against nil during the corresponding period last year.
The operating profit margin (OPM) on a standalone basis for the quarter improved by 140 basis points yoy to 31.1%. This was mainly on account of higher earning before interest and tax (EBIT) margin of the construction division, which reported an increase of 950 basis points to 25.5%. The real estate division reported an EBIT margin of 31.6%, while the cement division reported a negligible improvement of 30 basis points in EBIT margin to 35.3%. However the hotel and hospitality division reported a decline of 1,190 basis points in the EBIT margin to 16.7%. Consequently the operating profit jumped by 51.3% to Rs398 crore.
On a standalone basis, the company reported a net profit after tax (PAT) of Rs211 crore, up by 61.1% yoy. The growth in the net profit was mainly because of an increase in the other income by 120% to Rs66 crore.
For the year ended March 2008, on a standalone basis the net sales increased 14.6% yoy to Rs3,985 crore and the PAT stood at Rs610 crore, up 47% yoy. On a consolidated basis, the net sales increased by 6.8% to Rs4,201 crore and the adjusted PAT stood at Rs627 core, an increase of 21.2% yoy.
We have upgraded our FY2009 earnings per share (EPS) estimate by 10.9% to Rs6 and have also introduced FY2010 estimates. The estimated PAT for FY2010 stands at Rs947.9 crore, implying a growth of 26.4% over FY2009E. At the current market price of Rs269, the stock is trading at 45x its FY2009E EPS and 35x its FY2010E EPS. We maintain a Buy on the stock with a price target of Rs390 based on our sum-of-the-parts valuation.
Cluster: Ugly Duckling
Recommendation: Buy
Price target: Rs390
Current market price: Rs269
Results above expectations
Result highlights
Jaiprakash Associates Ltd (JAL) Q4FY2008 results were above our estimates. On a standalone basis the company reported a top line growth of 44.5% year on year (yoy) to Rs1,280 crore. This was on account of a 45.7% year-on-year (y-o-y) growth in the revenues from the construction division to Rs475 crore. The higher revenue was also aided by the revenue from the real estate division, which stood at Rs256 crore against nil during the corresponding period last year.
The operating profit margin (OPM) on a standalone basis for the quarter improved by 140 basis points yoy to 31.1%. This was mainly on account of higher earning before interest and tax (EBIT) margin of the construction division, which reported an increase of 950 basis points to 25.5%. The real estate division reported an EBIT margin of 31.6%, while the cement division reported a negligible improvement of 30 basis points in EBIT margin to 35.3%. However the hotel and hospitality division reported a decline of 1,190 basis points in the EBIT margin to 16.7%. Consequently the operating profit jumped by 51.3% to Rs398 crore.
On a standalone basis, the company reported a net profit after tax (PAT) of Rs211 crore, up by 61.1% yoy. The growth in the net profit was mainly because of an increase in the other income by 120% to Rs66 crore.
For the year ended March 2008, on a standalone basis the net sales increased 14.6% yoy to Rs3,985 crore and the PAT stood at Rs610 crore, up 47% yoy. On a consolidated basis, the net sales increased by 6.8% to Rs4,201 crore and the adjusted PAT stood at Rs627 core, an increase of 21.2% yoy.
We have upgraded our FY2009 earnings per share (EPS) estimate by 10.9% to Rs6 and have also introduced FY2010 estimates. The estimated PAT for FY2010 stands at Rs947.9 crore, implying a growth of 26.4% over FY2009E. At the current market price of Rs269, the stock is trading at 45x its FY2009E EPS and 35x its FY2010E EPS. We maintain a Buy on the stock with a price target of Rs390 based on our sum-of-the-parts valuation.
ET 500
The complete list of ET 500 Companies gives a clear picture upon performance of the Indian Corporates and achievements of top sectors.
As to the recent rankings given, the Information and Technology sector dominates the linking. The IT Companies such as Tata Consultancy Services and Infosys have got very good rankings in the given list.
The list of top 500 companies, their rankings and their Market Cap (Avg for Jan1-15 ‘07 in Rs Cr) is as follows:
Company Ranking (Mar 2000) Market Cap (Avg for Jan1-15 ‘07 in Rs Cr)
Tata Consultancy Services 1 124492
Infosys Technologies 2 124113
Wipro 3 87270
Bharti Airtel 4 120753
Suzlon Energy 5 36481
Hindustan Lever 6 47226
Bharat Heavy Electricals 7 54964
Siemens 8 18724
Tata Motors 9 35859
Larsen & Toubro 10 40987
HDFC 11 39522
Hindustan Zinc 12 33693
Reliance Industries 13 180685
Mahindra & Mahindra 14 22429
ITC 15 63431
Satyam Computer Services 16 32318
Cipla 17 19534
ONGC 18 192377
ICICI Bank 19 81495
Bajaj Auto 20 27928
Unitech 21 37413
ABB 22 15251
Sterlite Industries 23 30058
HDFC Bank 24 32847
Sun Pharmaceuticals 25 19068
Maruti Udyog 26 26711
Ultra Tech Cement 27 13597
Grasim Industries 28 25841
Gujarat Ambuja Cement 29 19187
ACC 30 19804
HCL Technologies 31 20021
Crompton Greaves 32 8026
Container Corporation of India 33 13590
NTPC 34 113099
UTI Bank 35 13477
Motor Industries Company 36 11237
Bharat Electronics 37 10444
I-flex Solutions 38 16035
Nestle India 39 11411
Hindalco Industries 40 19861
Dabur India 41 8719
Lakshmi Machine Works 42 4625
Indian Petrochemicals Corp 43 8657
Videocon Industries 44 10187
Dr.Reddy’s Laboratories 45 13502
Lupin 46 4740
Thermax 47 4672
Asian Paints 48 7081
Aditya Birla Nuvo 49 11815
Canara Bank 50 11303
Bank of India 51 9830
Ranbaxy Laboratories 52 15478
Titan Industries 53 3908
IVRCL Infrastructures 54 4499
Kalpataru Power Transmission 55 2765
Pantaloon Retail (India) 56 6654
Areva T&D India 57 4041
Kirloskar Brothers 58 4358
United Spirits 59 7896
Reliance Capital 60 14252
Cummins India 61 5378
Hero Honda Motors 62 14925
Ashok Leyland 63 6011
Punjab National Bank 64 15977
Tata Power Company 65 11194
Nagarjuna Construction 66 4615
Steel Authority of India 67 36818
Maharashtra Seamless 68 3213
Indian Hotels Co 69 9077
Madras Cements 70 4141
Voltas 71 3677
Century Textiles Ind 72 6878
Jaiprakash Associates 73 15507
Tata Steel 74 25866
Indian Overseas Bank 75 6192
Colgate Palmolive (I) 76 5227
Bank Of Baroda 77 8717
Shree Cement 78 5097
Havell’s India 79 2131
State Bank of India 80 63825
Kotak Mahindra Bank 81 13443
Ansal Properties & Infrastructure 82 5346
Jindal Steel & Power 83 6743
Peninsula Land 84 2355
India Cements 85 5151
National Aluminium Company 86 13545
United Phosphorus 87 5601
Aurobindo Pharma 88 3883
Indian Oil Corporation 89 54258
Marico 90 3171
Union Bank of India 91 6156
Birla Corporation 92 2562
Patel Engineering 93 2737
Shriram Transport Finance Co. 94 2392
Glenmark Pharmaceuticals 95 7083
Exide Industries 96 2981
Allahabad Bank 97 4007
Cadila Healthcare 98 4430
Centurion Bank of Punjab 99 4651
IDFC 100 8938
Panacea Biotec 101 2538
Jubilant Organosys 102 3653
Deccan Chronicle Holdings 103 3508
Bharat Forge Co. 104 8090
Amtek Auto 105 4549
Petronet LNG 106 3845
Bharat Petroleum Corpn 107 12606
Moser Baer (India) 108 3647
Divi’s Laboratories 109 3883
Anant Raj Industries 110 4704
United Breweries 111 4241
Motherson Sumi Systems 112 2520
Rajesh Exports 113 1507
Federal Bank 114 1989
EIH 115 4067
Andhra Bank 116 4231
Adani Enterprises 117 5562
Kesoram Industries 118 2494
HT Media 119 4032
Sesa Goa 120 6437
Hindustan Petroleum Corp. 121 9842
Bhushan Steel & Strips 122 1615
Jain Irrigation Systems 123 2246
Blue Star 124 1869
Gujarat State Fertilisers & Chem. 125 1563
JSW Steel 126 6317
Videsh Sanchar Nigam 127 12444
Aban Offshore 128 7930
Glaxosmithkline Pharma 129 9839
Oriental Bank of Commerce 130 5621
Pidilite Industries 131 3130
Hindustan Construction Co 132 4072
Reliance Energy 133 11122
GAIL (India) 134 23298
Sintex Industries 135 2494
Tulip IT Services 136 1647
Jindal Saw 137 1889
State Bank Of Travancore 138 1913
Essar Steel 139 4373
MRF 140 1815
Sundaram Clayton 141 2497
Syndicate Bank 142 3884
State Bank of Mysore 143 2222
Sanghi Industries 144 1250
Yes Bank 145 3796
Godrej Consumers Products 146 3438
MRPL 147 7165
Greaves Cotton 148 1658
Alstom Projects India 149 3116
Sterling Biotech 150 4312
Gammon India 151 3495
GHCL 152 1590
Gujarat Fluorochemicals 153 3555
Zee Entertainment 154 13237
Dalmia Cements (Bharat) 155 1944
Bharat Earth Movers 156 4116
IDBI 157 5801
Financial Technologies (India) 158 7685
Welspun Gujarat Stahl Rohren 159 1366
Bajaj Hindusthan 160 2909
Orient Paper & Industries 161 886
Sterlite Optical Technologies 162 1408
United Breweries Holdings 163 2150
Castrol India 164 2781
Nicholas Piramal India 165 5337
Kirloskar Oil Engines 166 2740
Balrampur Chini Mills 167 2028
Elecon Engineering Co 168 1334
Praj Industries 169 1916
Chettinad Cements 170 1543
Mphasis 171 4831
State Bank of Bikaner and Jaipur 172 1907
DCM Shriram Consolidated 173 1894
AIA Engineering 174 2519
Asahi India Glass 175 2164
Honeywell Automation India 176 1622
Jyoti Structures 177 1067
S Kumars Nationwide 178 1419
Hexaware Technologies 179 2496
Jet Airways (I) 180 5598
JK Cements 181 1316
Ruchi Soya Industries 182 1047
Shree Precoated Steels 183 4387
ISMT 184 1177
Kansai Nerolac Paints 185 2057
Shipping Corporation of India 186 4689
IFCI 187 1045
Indiabulls Financials Services 188 4730
Emami 189 1600
Hinduja TMT 190 2994
Chennai Petroleum Corporation 191 3189
Finolex Cables 192 1533
Opto Circuits (India) 193 1830
CESC 194 2631
Simplex Infrastructures 195 1632
SRF 196 1289
Britannia Industries 197 2643
ABG Shipyard 198 1540
Ashapura Minechem 199 873
Karnataka Bank 200 1802
HCL Infosystems 201 2720
Rolta India 202 2137
Rashtriya Chemicals & Fertilizers 203 2165
J K Lakshmi Cement 204 826
3M India 205 1700
Coromandel Fertilizers 206 1140
Shopper’s Stop 207 2394
Tata Chemicals 208 4661
Zuari Industries 209 618
Atlas Copco (I) 210 1647
Lakshmi Energy and Foods 211 944
Glaxosmithkline Consumers 212 2396
Madras Aluminium Co 213 911
Jammu & Kashmir Bank 214 3207
Raymond 215 2524
Tele Data Informatics 216 481
Vardhman Textiles 217 1592
Carborundum Universal 218 1771
Godrej Industries 219 5048
Tata Tea 220 4059
Subhash Projects & Marketing 221 808
Prism Cement 222 1069
Varun Shipping Company 223 809
Himadri Chemicals & Inds. 224 870
Procter & Gamble Hygiene 225 2853
Wockhardt 226 3840
Ballarpur Industries 227 1840
Era Constructions (India) 228 884
Mahanagar Telephone Nigam 229 9748
KSL Realty and Infrastructure 230 2367
Berger Paints India 231 1481
Gujarat Narmada Valley Fertilisers Co. 232 1544
Fag Bearings India 233 1124
Corporation Bank 234 4780
Apollo Tyres 235 1313
Pfizer 236 2459
SKF India 237 1430
Mangalam Cement 238 634
Ahmednagar Forgings 239 948
Asian Hotels 240 1649
KS Oils 241 450
Everest Kanto Cylinder 242 1312
TajGVK Hotels & Resorts 243 1438
Apollo Hospitals Enterprises 244 2184
PTC India 245 902
IG Petrochemicals 246 191
Kalyani Steels 247 1887
Dena Bank 248 1095
Uco Bank 249 1804
LIC Housing Finance 250 1362
Karur Vysya Bank 251 1432
TVS Motor Company 252 1944
Jaybharat Textiles And Real Estate 253 1240
Shree Renuka Sugars 254 1064
Apar Industries 255 587
Hotel Leela Venture 256 2341
Patni Computer Systems 257 5683
Bannari Amman Sugars 258 754
Dishman Pharmaceuticals 259 1728
ICSA India 260 637
Bombay Dyeing & Mfg. Co. 261 2905
Subex Azure 262 2422
Man Industries (India) 263 694
CMC 264 1089
NIIT Technologies 265 1176
Matrix Laboratories 266 3367
Gokaldas Exports 267 1068
ICI India 268 1820
Radico Khaitan 269 1575
Triveni Engineering & Industries 270 1413
Sundram Fasteners 271 1756
Bongaigaon Refinery 272 957
Indraprastha Gas 273 1686
Astrazen Pharma 274 1613
Infotech Enterprises 275 1538
Madhucon Projects 276 1146
Punj Lloyd 277 5400
Nahar Industrial Enterprises 278 695
Graphite India 279 864
Clariant Chemicals (India) 280 904
Bosch Chassis Systems India 281 1044
Chambal Fertiliser & Chemicals 282 1574
Aventis Pharma 283 3305
Tube Investments of India 284 1270
Alok Industries 285 1161
Adlabs Films 286 1961
Great Eastern Shipping Co. 287 3397
Phoenix Mills 288 1493
Gujarat Gas Company 289 1612
Amtek India 290 954
Lok Housing & Constructions 291 310
Orchid Chemicals & Pharmaceuticals 292 1349
Jindal Stainless 293 1566
Nesco 294 1349
Torrent Pharmaceuticals 295 1766
Ceat 296 583
Biocon 297 3694
Ipca Laboratories 298 1540
Bata India 299 1407
Emco 300 764
EID Parry 301 1215
India Infoline 302 1546
Ratnamani Metals & Tubes 303 433
Blue Dart Express 304 1265
Bank of Maharashtra 305 1826
Geodesic Information Systems 306 1272
Godavari Fertilisers & Chem 307 333
Automotive Axles 308 957
Fertilisers & Chemicals - Travancore 309 875
Essar Shipping 310 1838
Escorts 311 806
JBF Industries 312 613
Techno Electric & Engineering Company 313 584
Hindustan Machine Tools 314 3938
Television Eighteen India 315 3213
Prithvi Information Solutions 316 657
Gillette India 317 2816
Polaris Software Lab 318 1932
Educomp Solutions 319 1616
Prajay Engineers Syndicate 320 557
IGate Global Solutions 321 1234
IL&FS Investmart 322 1413
Vijaya Bank 323 2091
Transport Corporation of India 324 560
DS Kulkarni Developers 325 826
Sakthi Sugars 326 306
South Indian Bank 327 658
Max India 328 3223
Bharat Bijlee 329 696
OCL India 330 782
JM Financial 331 2435
Usha Martin 332 763
Unichem Laboratories 333 1038
Ruchi Infrastructure 334 922
Bajaj Electricals 335 408
Suashish Diamonds 336 486
Gulf Oil Corporation 337 1884
Mastek 338 1057
Nucleus Software Exports 339 1128
KSB Pumps 340 1104
Syngenta India 341 1174
Tata Elxsi 342 845
Bayer Cropscience 343 1209
Bharati Shipyard 344 868
Sanghvi Movers 345 570
Gemini Communications 346 650
Flex Industries 347 893
Texmaco 348 1240
Nirma 349 2834
CRISIL 350 1569
Balkrishna Industries 351 1052
KEI Industries 352 451
Donear Industries 353 1148
Jai Corp 354 3176
Bombay Rayon Fashions 355 1124
Supreme Industries 356 633
Balmer Lawrie & Company 357 681
Gujarat Sidhee Cement 358 348
Rain Calcining 359 676
Mercator Lines 360 856
Cranes Softwares International 361 1194
Alfa Laval (I) 362 1532
Gujarat Industrial Power Co. 363 967
Mahindra Gesco Developers 364 3126
ING Vysya Bank 365 1412
REI Agro 366 855
Strides Arcolab 367 1271
Pennar Industries 368 154
KPIT Cummins Infosystems 369 1002
3i Infotech 370 1182
Mahindra Ugine Steel Company 371 441
GTL 372 1435
Atul 373 371
HEG 374 715
Gujarat Alkalies & Chemicals 375 1142
Merck 376 797
National Fertilizer 377 1621
Core Projects And Technologies 378 562
Binani Industries 379 1129
KRBL 380 421
Ramsarup Industries 381 295
Savita Chemicals 382 460
Wyeth 383 1198
Uttam Galva Steel 384 304
Murli Industries 385 416
Alembic 386 898
Bilcare 387 846
Tata Investment Corporation 388 1328
Elder Pharmaceuticals 389 720
Tamilnadu Newsprint & Papers 390 655
Dredging Corporation of India 391 1676
Punjab Tractors 392 1500
Surana Industries 393 178
Mukand 394 654
Paramount Communications 395 321
Nava Bharat Ventures 396 740
GMR Industries 397 1014
Nagarjuna Fertilizers & Chemicals 398 661
Amara Raja Batteries 399 468
NIIT 400 1023
Sasken Communication Technologies 401 1637
Ingersoll-Rand (I) 402 1176
Electrotherm (India) 403 211
Kirloskar Pneumatic Co. 404 521
Kennametal India 405 1091
Lumax Industries 406 465
Gati 407 674
Gateway Distriparks 408 1861
ITD Cementation India 409 393
Asian Star Company 410 1416
Bajaj Auto Finance 411 1255
Abhishek Industries 412 443
PSL 413 679
Eicher Motors 414 1005
Ansal Housing & Construction 415 534
JB Chemicals & Pharmaceuticals 416 849
Vaibhav Gems 417 793
Grindwell Norton 418 717
Asian Electronics 419 590
Sona Koyo Steering Systems 420 546
Panchmahal Steel 421 214
Balaji Telefilms 422 871
Shiv-Vani Oil & Gas Exploration Services 423 1048
HBL Power Systems 424 681
Trent 425 1272
Eastern Silk Industries 426 514
Venus Remedies 427 376
Geojit Financial Services 428 534
JMC Projects (India) 429 391
Rajshree Sugars & Chemicals 430 177
Helios & Matheson Information Tech. 431 289
Ganesh Housing Finance Corrn. 432 444
Hindustan Sanitaryware & Inds 433 611
Mcnally Bharat Engineering Co. 434 464
Oudh Sugar Mills 435 154
Manugraph India 436 750
McLeod Russel India 437 940
Aftek 438 496
Goodyear India 439 399
ANG Auto 440 334
Shanthi Gears 441 596
Vertex Spinning 442 907
Dynamatic Technologies 443 558
Dabur Pharma 444 1245
Abbott India 445 796
Electrosteel Castings 446 822
Rico Auto Industries 447 796
BOC 448 829
Allsec Technologies 449 466
Sangam (India) 450 347
SREI Infrastructure Finance 451 590
BSEL Infrastructure Realty 452 413
Country Club (India) 453 329
Esab India 454 612
Shasun Chemicals & Drugs 455 595
Genus Overseas Electronics 456 231
Webel Sl Energy Systems 457 270
Sharon Bio-Medicine 458 222
Marg Constructions 459 285
South East Asia Marine Engg 460 638
CCL Products India 461 627
Shriram City Union Finance 462 437
Champagne Indage 463 721
Finolex Industries 464 1066
Provogue (India) 465 703
Rain Commodities 466 489
Southern Iron & Steel Company 467 689
Walchandnagar Industries 468 375
Megasoft 469 435
Gujarat Ambuja Exports 470 403
RPG Transmission 471 308
Sanwaria Agro Oils 472 230
Century Plyboards (India) 473 367
Kemrock Industries & Exports 474 275
Phoenix Lamps 475 359
BASF India 476 668
Automobile Corporation of Goa 477 236
Geometric Software Solution 478 791
Shrenuj & Company 479 290
Lloyd Electric & Engineering 480 437
Sujana Metal Products 481 377
City Union Bank 482 403
Vakrangee Softwares 483 510
Solectron Centum Electronics 484 418
Gruh Finance 485 468
Riddhi Siddhi Gluco Biols 486 268
Spanco Telesystems & Solutions 487 317
Oriental Hotels 488 708
Greenply Industries 489 169
Paper Products 490 472
Hindustan National Glass 491 618
NRB Bearings 492 488
Nahar Spinning Mills 493 444
Magma Leasing 494 329
Kajaria Ceramics 495 412
Zensar Technologies 496 560
Crew BOS Products 497 310
Dewan Housing Finance Corp 498 398
Subros 499 303
Classic Diamonds (I) 500 340
Source:economictimes
As to the recent rankings given, the Information and Technology sector dominates the linking. The IT Companies such as Tata Consultancy Services and Infosys have got very good rankings in the given list.
The list of top 500 companies, their rankings and their Market Cap (Avg for Jan1-15 ‘07 in Rs Cr) is as follows:
Company Ranking (Mar 2000) Market Cap (Avg for Jan1-15 ‘07 in Rs Cr)
Tata Consultancy Services 1 124492
Infosys Technologies 2 124113
Wipro 3 87270
Bharti Airtel 4 120753
Suzlon Energy 5 36481
Hindustan Lever 6 47226
Bharat Heavy Electricals 7 54964
Siemens 8 18724
Tata Motors 9 35859
Larsen & Toubro 10 40987
HDFC 11 39522
Hindustan Zinc 12 33693
Reliance Industries 13 180685
Mahindra & Mahindra 14 22429
ITC 15 63431
Satyam Computer Services 16 32318
Cipla 17 19534
ONGC 18 192377
ICICI Bank 19 81495
Bajaj Auto 20 27928
Unitech 21 37413
ABB 22 15251
Sterlite Industries 23 30058
HDFC Bank 24 32847
Sun Pharmaceuticals 25 19068
Maruti Udyog 26 26711
Ultra Tech Cement 27 13597
Grasim Industries 28 25841
Gujarat Ambuja Cement 29 19187
ACC 30 19804
HCL Technologies 31 20021
Crompton Greaves 32 8026
Container Corporation of India 33 13590
NTPC 34 113099
UTI Bank 35 13477
Motor Industries Company 36 11237
Bharat Electronics 37 10444
I-flex Solutions 38 16035
Nestle India 39 11411
Hindalco Industries 40 19861
Dabur India 41 8719
Lakshmi Machine Works 42 4625
Indian Petrochemicals Corp 43 8657
Videocon Industries 44 10187
Dr.Reddy’s Laboratories 45 13502
Lupin 46 4740
Thermax 47 4672
Asian Paints 48 7081
Aditya Birla Nuvo 49 11815
Canara Bank 50 11303
Bank of India 51 9830
Ranbaxy Laboratories 52 15478
Titan Industries 53 3908
IVRCL Infrastructures 54 4499
Kalpataru Power Transmission 55 2765
Pantaloon Retail (India) 56 6654
Areva T&D India 57 4041
Kirloskar Brothers 58 4358
United Spirits 59 7896
Reliance Capital 60 14252
Cummins India 61 5378
Hero Honda Motors 62 14925
Ashok Leyland 63 6011
Punjab National Bank 64 15977
Tata Power Company 65 11194
Nagarjuna Construction 66 4615
Steel Authority of India 67 36818
Maharashtra Seamless 68 3213
Indian Hotels Co 69 9077
Madras Cements 70 4141
Voltas 71 3677
Century Textiles Ind 72 6878
Jaiprakash Associates 73 15507
Tata Steel 74 25866
Indian Overseas Bank 75 6192
Colgate Palmolive (I) 76 5227
Bank Of Baroda 77 8717
Shree Cement 78 5097
Havell’s India 79 2131
State Bank of India 80 63825
Kotak Mahindra Bank 81 13443
Ansal Properties & Infrastructure 82 5346
Jindal Steel & Power 83 6743
Peninsula Land 84 2355
India Cements 85 5151
National Aluminium Company 86 13545
United Phosphorus 87 5601
Aurobindo Pharma 88 3883
Indian Oil Corporation 89 54258
Marico 90 3171
Union Bank of India 91 6156
Birla Corporation 92 2562
Patel Engineering 93 2737
Shriram Transport Finance Co. 94 2392
Glenmark Pharmaceuticals 95 7083
Exide Industries 96 2981
Allahabad Bank 97 4007
Cadila Healthcare 98 4430
Centurion Bank of Punjab 99 4651
IDFC 100 8938
Panacea Biotec 101 2538
Jubilant Organosys 102 3653
Deccan Chronicle Holdings 103 3508
Bharat Forge Co. 104 8090
Amtek Auto 105 4549
Petronet LNG 106 3845
Bharat Petroleum Corpn 107 12606
Moser Baer (India) 108 3647
Divi’s Laboratories 109 3883
Anant Raj Industries 110 4704
United Breweries 111 4241
Motherson Sumi Systems 112 2520
Rajesh Exports 113 1507
Federal Bank 114 1989
EIH 115 4067
Andhra Bank 116 4231
Adani Enterprises 117 5562
Kesoram Industries 118 2494
HT Media 119 4032
Sesa Goa 120 6437
Hindustan Petroleum Corp. 121 9842
Bhushan Steel & Strips 122 1615
Jain Irrigation Systems 123 2246
Blue Star 124 1869
Gujarat State Fertilisers & Chem. 125 1563
JSW Steel 126 6317
Videsh Sanchar Nigam 127 12444
Aban Offshore 128 7930
Glaxosmithkline Pharma 129 9839
Oriental Bank of Commerce 130 5621
Pidilite Industries 131 3130
Hindustan Construction Co 132 4072
Reliance Energy 133 11122
GAIL (India) 134 23298
Sintex Industries 135 2494
Tulip IT Services 136 1647
Jindal Saw 137 1889
State Bank Of Travancore 138 1913
Essar Steel 139 4373
MRF 140 1815
Sundaram Clayton 141 2497
Syndicate Bank 142 3884
State Bank of Mysore 143 2222
Sanghi Industries 144 1250
Yes Bank 145 3796
Godrej Consumers Products 146 3438
MRPL 147 7165
Greaves Cotton 148 1658
Alstom Projects India 149 3116
Sterling Biotech 150 4312
Gammon India 151 3495
GHCL 152 1590
Gujarat Fluorochemicals 153 3555
Zee Entertainment 154 13237
Dalmia Cements (Bharat) 155 1944
Bharat Earth Movers 156 4116
IDBI 157 5801
Financial Technologies (India) 158 7685
Welspun Gujarat Stahl Rohren 159 1366
Bajaj Hindusthan 160 2909
Orient Paper & Industries 161 886
Sterlite Optical Technologies 162 1408
United Breweries Holdings 163 2150
Castrol India 164 2781
Nicholas Piramal India 165 5337
Kirloskar Oil Engines 166 2740
Balrampur Chini Mills 167 2028
Elecon Engineering Co 168 1334
Praj Industries 169 1916
Chettinad Cements 170 1543
Mphasis 171 4831
State Bank of Bikaner and Jaipur 172 1907
DCM Shriram Consolidated 173 1894
AIA Engineering 174 2519
Asahi India Glass 175 2164
Honeywell Automation India 176 1622
Jyoti Structures 177 1067
S Kumars Nationwide 178 1419
Hexaware Technologies 179 2496
Jet Airways (I) 180 5598
JK Cements 181 1316
Ruchi Soya Industries 182 1047
Shree Precoated Steels 183 4387
ISMT 184 1177
Kansai Nerolac Paints 185 2057
Shipping Corporation of India 186 4689
IFCI 187 1045
Indiabulls Financials Services 188 4730
Emami 189 1600
Hinduja TMT 190 2994
Chennai Petroleum Corporation 191 3189
Finolex Cables 192 1533
Opto Circuits (India) 193 1830
CESC 194 2631
Simplex Infrastructures 195 1632
SRF 196 1289
Britannia Industries 197 2643
ABG Shipyard 198 1540
Ashapura Minechem 199 873
Karnataka Bank 200 1802
HCL Infosystems 201 2720
Rolta India 202 2137
Rashtriya Chemicals & Fertilizers 203 2165
J K Lakshmi Cement 204 826
3M India 205 1700
Coromandel Fertilizers 206 1140
Shopper’s Stop 207 2394
Tata Chemicals 208 4661
Zuari Industries 209 618
Atlas Copco (I) 210 1647
Lakshmi Energy and Foods 211 944
Glaxosmithkline Consumers 212 2396
Madras Aluminium Co 213 911
Jammu & Kashmir Bank 214 3207
Raymond 215 2524
Tele Data Informatics 216 481
Vardhman Textiles 217 1592
Carborundum Universal 218 1771
Godrej Industries 219 5048
Tata Tea 220 4059
Subhash Projects & Marketing 221 808
Prism Cement 222 1069
Varun Shipping Company 223 809
Himadri Chemicals & Inds. 224 870
Procter & Gamble Hygiene 225 2853
Wockhardt 226 3840
Ballarpur Industries 227 1840
Era Constructions (India) 228 884
Mahanagar Telephone Nigam 229 9748
KSL Realty and Infrastructure 230 2367
Berger Paints India 231 1481
Gujarat Narmada Valley Fertilisers Co. 232 1544
Fag Bearings India 233 1124
Corporation Bank 234 4780
Apollo Tyres 235 1313
Pfizer 236 2459
SKF India 237 1430
Mangalam Cement 238 634
Ahmednagar Forgings 239 948
Asian Hotels 240 1649
KS Oils 241 450
Everest Kanto Cylinder 242 1312
TajGVK Hotels & Resorts 243 1438
Apollo Hospitals Enterprises 244 2184
PTC India 245 902
IG Petrochemicals 246 191
Kalyani Steels 247 1887
Dena Bank 248 1095
Uco Bank 249 1804
LIC Housing Finance 250 1362
Karur Vysya Bank 251 1432
TVS Motor Company 252 1944
Jaybharat Textiles And Real Estate 253 1240
Shree Renuka Sugars 254 1064
Apar Industries 255 587
Hotel Leela Venture 256 2341
Patni Computer Systems 257 5683
Bannari Amman Sugars 258 754
Dishman Pharmaceuticals 259 1728
ICSA India 260 637
Bombay Dyeing & Mfg. Co. 261 2905
Subex Azure 262 2422
Man Industries (India) 263 694
CMC 264 1089
NIIT Technologies 265 1176
Matrix Laboratories 266 3367
Gokaldas Exports 267 1068
ICI India 268 1820
Radico Khaitan 269 1575
Triveni Engineering & Industries 270 1413
Sundram Fasteners 271 1756
Bongaigaon Refinery 272 957
Indraprastha Gas 273 1686
Astrazen Pharma 274 1613
Infotech Enterprises 275 1538
Madhucon Projects 276 1146
Punj Lloyd 277 5400
Nahar Industrial Enterprises 278 695
Graphite India 279 864
Clariant Chemicals (India) 280 904
Bosch Chassis Systems India 281 1044
Chambal Fertiliser & Chemicals 282 1574
Aventis Pharma 283 3305
Tube Investments of India 284 1270
Alok Industries 285 1161
Adlabs Films 286 1961
Great Eastern Shipping Co. 287 3397
Phoenix Mills 288 1493
Gujarat Gas Company 289 1612
Amtek India 290 954
Lok Housing & Constructions 291 310
Orchid Chemicals & Pharmaceuticals 292 1349
Jindal Stainless 293 1566
Nesco 294 1349
Torrent Pharmaceuticals 295 1766
Ceat 296 583
Biocon 297 3694
Ipca Laboratories 298 1540
Bata India 299 1407
Emco 300 764
EID Parry 301 1215
India Infoline 302 1546
Ratnamani Metals & Tubes 303 433
Blue Dart Express 304 1265
Bank of Maharashtra 305 1826
Geodesic Information Systems 306 1272
Godavari Fertilisers & Chem 307 333
Automotive Axles 308 957
Fertilisers & Chemicals - Travancore 309 875
Essar Shipping 310 1838
Escorts 311 806
JBF Industries 312 613
Techno Electric & Engineering Company 313 584
Hindustan Machine Tools 314 3938
Television Eighteen India 315 3213
Prithvi Information Solutions 316 657
Gillette India 317 2816
Polaris Software Lab 318 1932
Educomp Solutions 319 1616
Prajay Engineers Syndicate 320 557
IGate Global Solutions 321 1234
IL&FS Investmart 322 1413
Vijaya Bank 323 2091
Transport Corporation of India 324 560
DS Kulkarni Developers 325 826
Sakthi Sugars 326 306
South Indian Bank 327 658
Max India 328 3223
Bharat Bijlee 329 696
OCL India 330 782
JM Financial 331 2435
Usha Martin 332 763
Unichem Laboratories 333 1038
Ruchi Infrastructure 334 922
Bajaj Electricals 335 408
Suashish Diamonds 336 486
Gulf Oil Corporation 337 1884
Mastek 338 1057
Nucleus Software Exports 339 1128
KSB Pumps 340 1104
Syngenta India 341 1174
Tata Elxsi 342 845
Bayer Cropscience 343 1209
Bharati Shipyard 344 868
Sanghvi Movers 345 570
Gemini Communications 346 650
Flex Industries 347 893
Texmaco 348 1240
Nirma 349 2834
CRISIL 350 1569
Balkrishna Industries 351 1052
KEI Industries 352 451
Donear Industries 353 1148
Jai Corp 354 3176
Bombay Rayon Fashions 355 1124
Supreme Industries 356 633
Balmer Lawrie & Company 357 681
Gujarat Sidhee Cement 358 348
Rain Calcining 359 676
Mercator Lines 360 856
Cranes Softwares International 361 1194
Alfa Laval (I) 362 1532
Gujarat Industrial Power Co. 363 967
Mahindra Gesco Developers 364 3126
ING Vysya Bank 365 1412
REI Agro 366 855
Strides Arcolab 367 1271
Pennar Industries 368 154
KPIT Cummins Infosystems 369 1002
3i Infotech 370 1182
Mahindra Ugine Steel Company 371 441
GTL 372 1435
Atul 373 371
HEG 374 715
Gujarat Alkalies & Chemicals 375 1142
Merck 376 797
National Fertilizer 377 1621
Core Projects And Technologies 378 562
Binani Industries 379 1129
KRBL 380 421
Ramsarup Industries 381 295
Savita Chemicals 382 460
Wyeth 383 1198
Uttam Galva Steel 384 304
Murli Industries 385 416
Alembic 386 898
Bilcare 387 846
Tata Investment Corporation 388 1328
Elder Pharmaceuticals 389 720
Tamilnadu Newsprint & Papers 390 655
Dredging Corporation of India 391 1676
Punjab Tractors 392 1500
Surana Industries 393 178
Mukand 394 654
Paramount Communications 395 321
Nava Bharat Ventures 396 740
GMR Industries 397 1014
Nagarjuna Fertilizers & Chemicals 398 661
Amara Raja Batteries 399 468
NIIT 400 1023
Sasken Communication Technologies 401 1637
Ingersoll-Rand (I) 402 1176
Electrotherm (India) 403 211
Kirloskar Pneumatic Co. 404 521
Kennametal India 405 1091
Lumax Industries 406 465
Gati 407 674
Gateway Distriparks 408 1861
ITD Cementation India 409 393
Asian Star Company 410 1416
Bajaj Auto Finance 411 1255
Abhishek Industries 412 443
PSL 413 679
Eicher Motors 414 1005
Ansal Housing & Construction 415 534
JB Chemicals & Pharmaceuticals 416 849
Vaibhav Gems 417 793
Grindwell Norton 418 717
Asian Electronics 419 590
Sona Koyo Steering Systems 420 546
Panchmahal Steel 421 214
Balaji Telefilms 422 871
Shiv-Vani Oil & Gas Exploration Services 423 1048
HBL Power Systems 424 681
Trent 425 1272
Eastern Silk Industries 426 514
Venus Remedies 427 376
Geojit Financial Services 428 534
JMC Projects (India) 429 391
Rajshree Sugars & Chemicals 430 177
Helios & Matheson Information Tech. 431 289
Ganesh Housing Finance Corrn. 432 444
Hindustan Sanitaryware & Inds 433 611
Mcnally Bharat Engineering Co. 434 464
Oudh Sugar Mills 435 154
Manugraph India 436 750
McLeod Russel India 437 940
Aftek 438 496
Goodyear India 439 399
ANG Auto 440 334
Shanthi Gears 441 596
Vertex Spinning 442 907
Dynamatic Technologies 443 558
Dabur Pharma 444 1245
Abbott India 445 796
Electrosteel Castings 446 822
Rico Auto Industries 447 796
BOC 448 829
Allsec Technologies 449 466
Sangam (India) 450 347
SREI Infrastructure Finance 451 590
BSEL Infrastructure Realty 452 413
Country Club (India) 453 329
Esab India 454 612
Shasun Chemicals & Drugs 455 595
Genus Overseas Electronics 456 231
Webel Sl Energy Systems 457 270
Sharon Bio-Medicine 458 222
Marg Constructions 459 285
South East Asia Marine Engg 460 638
CCL Products India 461 627
Shriram City Union Finance 462 437
Champagne Indage 463 721
Finolex Industries 464 1066
Provogue (India) 465 703
Rain Commodities 466 489
Southern Iron & Steel Company 467 689
Walchandnagar Industries 468 375
Megasoft 469 435
Gujarat Ambuja Exports 470 403
RPG Transmission 471 308
Sanwaria Agro Oils 472 230
Century Plyboards (India) 473 367
Kemrock Industries & Exports 474 275
Phoenix Lamps 475 359
BASF India 476 668
Automobile Corporation of Goa 477 236
Geometric Software Solution 478 791
Shrenuj & Company 479 290
Lloyd Electric & Engineering 480 437
Sujana Metal Products 481 377
City Union Bank 482 403
Vakrangee Softwares 483 510
Solectron Centum Electronics 484 418
Gruh Finance 485 468
Riddhi Siddhi Gluco Biols 486 268
Spanco Telesystems & Solutions 487 317
Oriental Hotels 488 708
Greenply Industries 489 169
Paper Products 490 472
Hindustan National Glass 491 618
NRB Bearings 492 488
Nahar Spinning Mills 493 444
Magma Leasing 494 329
Kajaria Ceramics 495 412
Zensar Technologies 496 560
Crew BOS Products 497 310
Dewan Housing Finance Corp 498 398
Subros 499 303
Classic Diamonds (I) 500 340
Source:economictimes
Thursday, May 8, 2008
Need to produce less sugar, more ethanol: Experts
Keeping focus on ethanol right now SP Tulsian of sptulsian.com and M Manickam, MD of Sakthi Sugars, who suggests that we need to produce less sugar and produce more alcohol. Tulsian estimates that the season of 2008-09 will have a sugar production of 21 million tonne. That will give a production of about 200 crore litre of ethanol.
Excerpts from CNBC-TV18's exclusive interview with SP Tulsian and M Manickam:
Q: A question on demand-supply scenario on account of this increase in ethanol blending. The government has mandated about 10% by October 2008, 20% ethanol blending by about 2011, sugar supplies are expected to come under pressure in 2009. Are you going to see a major demand-supply mismatch in cane production now on account of this ethanol demand?
Tulsian: Definitely. Just a quick recap - 2007-08 the season, which will end this September, will have sugar production of about 26 million tonne. That will give ethanol production of about maybe 250 crore litre. Since we have about 80 crore litre of ethanol required for industrial purposes, 90 crore litre required for potable - for drinking purposes, so this season we have 80 crore litre of ethanol available for blending with petrol. The annual consumption of petrol in the country is about 1,600 crore litre, 5% of that is required of about 80 crore. That means 80 crore surplus of ethanol for this season will take care probably of my blending of 5% in petrol.
But season of 2008-09 is estimated to have a sugar production of 21 million tonne. That will give a production of about 200 crore litre of ethanol, which will definitely not be sufficient even to meet the 5% blending norm because no one can sacrifice for the industrial and drinking category that will be requiring about 170 crore litre. What we will be left with is 30-40 crore litre while 5% blending alone will require about 80 crore litre.
So suppose if I go for 10% blending, which is contemplated by the government from October 2008, that will require about 150 crore litre of ethanol. Where do you have that kind of ethanol because farmers have been moving away from sugarcane crop to other crop as sugarcane is a one-year crop, while they are moving to other crop, which can have two crops in a year. In fact there is a strong mismatch. You will not be having matching sugarcane production, which even will be sufficient for you to go for 5% blending from October 2008.
Q: Has the government even moved towards implementing the October 2008 deadline of lifting ethanol and blending? Do you see enough progress in that direction at least?
Manickam: I think almost all the states have implemented it except Tamil Nadu where we have a problem of supply. But most states where 5% is being blended and is being used at this point of time, I don’t see an issue on 10% either because what you need to do is produce less sugar and produce more alcohol which is we have to reduce the sugar production by 2 million and we have surplus sugar anyway. So I think we can reduce the sugar and produce more alcohol.
Q: Do you see any direction or any moves towards giving ethanol declared goods status?
Manickam: Not yet. It has been talked about but we have not heard anything on that count yet.
Q: But if that does happen do you see a material improvement in ethanol usage?
Manickam: To a certain extent there will be a good movement of stocks. In fact we have surplus stock available in Karnataka and possibly in Maharashtra, which can move across the country. We also have surplus distillation capacity available. I think if they have molasses moving, they will be able distill molasses wherever they can.
Q: There are three factors that have probably come to a head in 2009 according to what Mr. Tulsian has been saying. There could probably be less cane grown in the country, there would perhaps be an upward movement in international and domestic sugar prices and if crude prices continue the way they are or even remain where they are, the demand for ethanol could also increase. Do you see 2009 as an excellent sugar year? What kind of margins do you think you would be able to notch up compared to 2008?
Manickam: 2009 should be a good year, but I am scared to say that lest the government is listening to it and puts a dampener on the whole thing. But it should be a good year because of ethanol prices and oil prices going up. Internationally also we are finding that sugar prices are likely to firm up. So, it is looking like it is going to be a good year.
Q: As a stock picker, how would this issue pan out and what would you recommend?
Tulsian: My call is that probably from the season that will be starting from October 2008 and which will effectively last till March 2009 in Maharashtra and UP, probably there will be a lull on sugar stocks till September 2008, because right now for the next six months only the inventory would get sold by all the mills, those who have crushed. Definitely since the government is too keen on controlling inflation, if they see any price rise happening in sugar, there will be a free release mechanism. Right now there is ample stock in the system. You need to liquidate at least 4-5 million tonne from the system to get rid of the excess supply. So, I do not expect anything happening in the sector till October 2008. If somebody really wants to take a call probably the stock picking would only start happening from October to December 2008.
Link to the article: http://www.moneycontrol.com/india/news/business/need-to-produce-less-sugar-more-ethanol-experts/17/19/337330
Excerpts from CNBC-TV18's exclusive interview with SP Tulsian and M Manickam:
Q: A question on demand-supply scenario on account of this increase in ethanol blending. The government has mandated about 10% by October 2008, 20% ethanol blending by about 2011, sugar supplies are expected to come under pressure in 2009. Are you going to see a major demand-supply mismatch in cane production now on account of this ethanol demand?
Tulsian: Definitely. Just a quick recap - 2007-08 the season, which will end this September, will have sugar production of about 26 million tonne. That will give ethanol production of about maybe 250 crore litre. Since we have about 80 crore litre of ethanol required for industrial purposes, 90 crore litre required for potable - for drinking purposes, so this season we have 80 crore litre of ethanol available for blending with petrol. The annual consumption of petrol in the country is about 1,600 crore litre, 5% of that is required of about 80 crore. That means 80 crore surplus of ethanol for this season will take care probably of my blending of 5% in petrol.
But season of 2008-09 is estimated to have a sugar production of 21 million tonne. That will give a production of about 200 crore litre of ethanol, which will definitely not be sufficient even to meet the 5% blending norm because no one can sacrifice for the industrial and drinking category that will be requiring about 170 crore litre. What we will be left with is 30-40 crore litre while 5% blending alone will require about 80 crore litre.
So suppose if I go for 10% blending, which is contemplated by the government from October 2008, that will require about 150 crore litre of ethanol. Where do you have that kind of ethanol because farmers have been moving away from sugarcane crop to other crop as sugarcane is a one-year crop, while they are moving to other crop, which can have two crops in a year. In fact there is a strong mismatch. You will not be having matching sugarcane production, which even will be sufficient for you to go for 5% blending from October 2008.
Q: Has the government even moved towards implementing the October 2008 deadline of lifting ethanol and blending? Do you see enough progress in that direction at least?
Manickam: I think almost all the states have implemented it except Tamil Nadu where we have a problem of supply. But most states where 5% is being blended and is being used at this point of time, I don’t see an issue on 10% either because what you need to do is produce less sugar and produce more alcohol which is we have to reduce the sugar production by 2 million and we have surplus sugar anyway. So I think we can reduce the sugar and produce more alcohol.
Q: Do you see any direction or any moves towards giving ethanol declared goods status?
Manickam: Not yet. It has been talked about but we have not heard anything on that count yet.
Q: But if that does happen do you see a material improvement in ethanol usage?
Manickam: To a certain extent there will be a good movement of stocks. In fact we have surplus stock available in Karnataka and possibly in Maharashtra, which can move across the country. We also have surplus distillation capacity available. I think if they have molasses moving, they will be able distill molasses wherever they can.
Q: There are three factors that have probably come to a head in 2009 according to what Mr. Tulsian has been saying. There could probably be less cane grown in the country, there would perhaps be an upward movement in international and domestic sugar prices and if crude prices continue the way they are or even remain where they are, the demand for ethanol could also increase. Do you see 2009 as an excellent sugar year? What kind of margins do you think you would be able to notch up compared to 2008?
Manickam: 2009 should be a good year, but I am scared to say that lest the government is listening to it and puts a dampener on the whole thing. But it should be a good year because of ethanol prices and oil prices going up. Internationally also we are finding that sugar prices are likely to firm up. So, it is looking like it is going to be a good year.
Q: As a stock picker, how would this issue pan out and what would you recommend?
Tulsian: My call is that probably from the season that will be starting from October 2008 and which will effectively last till March 2009 in Maharashtra and UP, probably there will be a lull on sugar stocks till September 2008, because right now for the next six months only the inventory would get sold by all the mills, those who have crushed. Definitely since the government is too keen on controlling inflation, if they see any price rise happening in sugar, there will be a free release mechanism. Right now there is ample stock in the system. You need to liquidate at least 4-5 million tonne from the system to get rid of the excess supply. So, I do not expect anything happening in the sector till October 2008. If somebody really wants to take a call probably the stock picking would only start happening from October to December 2008.
Link to the article: http://www.moneycontrol.com/india/news/business/need-to-produce-less-sugar-more-ethanol-experts/17/19/337330
Tuesday, May 6, 2008
Subex - Subex, Accenture implement activation solution
Subex Ltd and Accenture have implemented the first phase of a multi-technology activation solution for Telecom Argentina, one of Argentina's largest telecommunications groups.
"The solution will help ensure IP services dominance, enable rapid delivery of Ethernet-based services and accelerate growth in broadband," Subex, a telecom software services provider, said in a statement.
Leveraging Subex's service fulfilment platform, the three-phase, multi-million dollar project is the main component of an ambitious transformation strategy being undertaken by Telecom Argentina, it said.
The first phase provides Telecom Argentina flow-through provisioning of its IP-VPN services and facilitates the assurance processes, the statement said.
Link to the article: http://www.hindu.com/thehindu/holnus/008200805061731.htm
"The solution will help ensure IP services dominance, enable rapid delivery of Ethernet-based services and accelerate growth in broadband," Subex, a telecom software services provider, said in a statement.
Leveraging Subex's service fulfilment platform, the three-phase, multi-million dollar project is the main component of an ambitious transformation strategy being undertaken by Telecom Argentina, it said.
The first phase provides Telecom Argentina flow-through provisioning of its IP-VPN services and facilitates the assurance processes, the statement said.
Link to the article: http://www.hindu.com/thehindu/holnus/008200805061731.htm
IVRCL - IVRCL Infra has target of Rs 650: Gujral
Technical Analyst, Ashwani Gujral is of the view that Above Rs 492 IVRCL Infrastructure has target of Rs 650.
Gujral told CNBC-TV18, IVRCL Infra is in a medium-term range of about Rs 340 and Rs 560. Once it can trade above Rs 490, I think targets of Rs 650 are possible. These stocks have been late movers, so chances are they would tend to touch the higher end of the range."
Link to the article: http://www.moneycontrol.com/india/news/stocks-views/ivrcl-infra-has-targetrs-650-gujral/11/34/336875
Gujral told CNBC-TV18, IVRCL Infra is in a medium-term range of about Rs 340 and Rs 560. Once it can trade above Rs 490, I think targets of Rs 650 are possible. These stocks have been late movers, so chances are they would tend to touch the higher end of the range."
Link to the article: http://www.moneycontrol.com/india/news/stocks-views/ivrcl-infra-has-targetrs-650-gujral/11/34/336875
Monday, May 5, 2008
IVRCL - IVRCL Infra bags Rs468 crore orders from Andhra govt
Contracts are from state’s irrigation and CAD department for modernization of Godavari Delta Canal System
IVRCL Infrastructures and Projects Ltd said on 5 May it has bagged orders worth Rs468.59 crore from the irrigation and CAD department of government of Andhra Pradesh for modernization of the Godavari Delta Canal System. The company has bagged Rs134.35 crore order for the modernization of Narsapur Canal, Rs111.65 crore for Yanamadurru Drain, Rs98.26 crore for Samalkot Canal and its distributory system and Rs124.33 crore for the Kakinada Canal and KMJ Canal, IVRCL Infrastructures said in a filing to the Bombay Stock Exchange. The scope of the order includes excavation and forming embankment for canal and channels, construction of concrete retaining walls, formation of roads on either side of canal banks among other things.
Link to the article: http://www.livemint.com/2008/05/05140210/IVRCL-Infra-bags-Rs468-crore-o.html
IVRCL Infrastructures and Projects Ltd said on 5 May it has bagged orders worth Rs468.59 crore from the irrigation and CAD department of government of Andhra Pradesh for modernization of the Godavari Delta Canal System. The company has bagged Rs134.35 crore order for the modernization of Narsapur Canal, Rs111.65 crore for Yanamadurru Drain, Rs98.26 crore for Samalkot Canal and its distributory system and Rs124.33 crore for the Kakinada Canal and KMJ Canal, IVRCL Infrastructures said in a filing to the Bombay Stock Exchange. The scope of the order includes excavation and forming embankment for canal and channels, construction of concrete retaining walls, formation of roads on either side of canal banks among other things.
Link to the article: http://www.livemint.com/2008/05/05140210/IVRCL-Infra-bags-Rs468-crore-o.html
Saturday, May 3, 2008
Wockhardt - Buy Wockhardt, target of Rs 480: Angel
Angel Broking has maintained its buy rating on Wockhardt with a revised target price of Rs 480 in its April 30, 2008 research report. "For 1QCY2008, while Wockhardt’s Sales at Rs 786 crore was in line with our expectations, Net Profit at Rs 50.9 crore was a disappointment. The key factors impacting the same have been the substantial jump in Interest expenditure along with the Rs 27.3 crore MTM losses booked by the company during the period. Thus, in spite of a yoy growth of 50.3% on the Sales front, the company posted a 23.2% decline in Net Profit during the period"
"At the CMP, the stock is trading at 6.6x CY2008E and 5.8x CY2009E EPS, which is at a significant discount to its peers. A substantial part of the discount is on account of the high competitive pressures in the Generic space and dependence of the company on its M&A strategy to scale up its Generic business. A part of the discount is also due to the accounting polices followed by the company (deferment of R&D expenditure). On the Earnings front, we have pruned our Net Profit estimates by 9% for CY2008E and CY2009E, respectively. Overall, owing to the concerns, we have downgraded our Target P/E multiple to 10x. We maintain a Buy on the stock, with a revised Target Price of Rs 480, over an 18-month period, says Angel's research report.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Link to the article: http://www.moneycontrol.com/india/news/recommendations/buy-wockhardt-targetrs-480-angel/11/45/336612
"At the CMP, the stock is trading at 6.6x CY2008E and 5.8x CY2009E EPS, which is at a significant discount to its peers. A substantial part of the discount is on account of the high competitive pressures in the Generic space and dependence of the company on its M&A strategy to scale up its Generic business. A part of the discount is also due to the accounting polices followed by the company (deferment of R&D expenditure). On the Earnings front, we have pruned our Net Profit estimates by 9% for CY2008E and CY2009E, respectively. Overall, owing to the concerns, we have downgraded our Target P/E multiple to 10x. We maintain a Buy on the stock, with a revised Target Price of Rs 480, over an 18-month period, says Angel's research report.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Link to the article: http://www.moneycontrol.com/india/news/recommendations/buy-wockhardt-targetrs-480-angel/11/45/336612
Friday, May 2, 2008
IVRCL - Hyderabad builder will make cement to meet own demand
IVRCL is unable to buy the required quantities for its daily operations although it was ready to buy the cement at higher prices.
City-based IVRCL Infrastructure and Projects Ltd, which earned Rs2,379 crore in revenues last fiscal year, will build a cement factory byallying with other builders to tackle short supply and rising prices, said its top executive. “Our requirement of cement is around 50,000 bags per day and sometimes we hardly get 6,000-10,000 bags a day despite having entered into long-term supply arrangements with the cement producers,” IVRCL chairman and managing director E. Sudhir Reddy told Mint.
Reddy said the scarcity of cement, a key raw material for builders, was hurting growth. “We thought we will grow 80% this year, but we are growing at around 40% only. For outsiders, 40% growth looks great but we know internally what we are missing out.” He said IVRCL is unable to buy the required quantities for its daily operations although it was ready to buy the cement at higher prices. “We don’t mind buying cement at higher prices but the supplies have become a major constraint. Sometimes, the cement companies with whom we have agreements of long-term supplies do not honour the deal.”
The company has been importing cement from Pakistan. “This is not going to solve our problems. We cannot buy large quantities because we may incur huge losses if the consignment is spoiled withmoisture due to delays in the ports” A cement manufacturingfacility with a capacity of 1 million tonnes (mt) of ordinary Portland cement or 1.25mtof blended cement involvesan investment of aroundRs400 crore, said Ramesh Chandro, managing director of the city-based Coromandel Cements Ltd. “Raising funds is not an issue for setting up the cement facility. Today, each one of the construction companies (the firm is talking with) can cough up Rs25-50 crore to set up four-five small cement units and leave them to professionals to run,” said Reddy. He also pointed out that some construction firms such as the MyHome group already has a captive cement plant to meet its needs. Janapriya Engineers Syndicate Ltd, another Hyderabad-based construction firm, also has a captive cement factory.
IVRCL’s demand will be met with a 1mt facility that can deliver 20 million bags a year. The firm currently operates in infrastructure segments that include water and environment, transportation, buildings and industrial structures, and power. It has orders of Rs11,000 crore at the end of December. On 31 March last year, India’s installed cement capacity was 177.83mt, while production was 161.66mt, according to industry body Cement Manufacturers Association. Although an analyst called the construction firms’ strategy of entering cement manufacturing a smart move, he advised caution. “It takes at least two years to set up a cement unit. But by then, the country is likely to witness enough capacities, if not excess capacities, to meet the demand, since several existing players have gone in for expansion,” he said, on condition of anonymity.
Link to the article: http://www.livemint.com/2008/05/02224540/Hyderabad-builder-will-make-ce.html
City-based IVRCL Infrastructure and Projects Ltd, which earned Rs2,379 crore in revenues last fiscal year, will build a cement factory byallying with other builders to tackle short supply and rising prices, said its top executive. “Our requirement of cement is around 50,000 bags per day and sometimes we hardly get 6,000-10,000 bags a day despite having entered into long-term supply arrangements with the cement producers,” IVRCL chairman and managing director E. Sudhir Reddy told Mint.
Reddy said the scarcity of cement, a key raw material for builders, was hurting growth. “We thought we will grow 80% this year, but we are growing at around 40% only. For outsiders, 40% growth looks great but we know internally what we are missing out.” He said IVRCL is unable to buy the required quantities for its daily operations although it was ready to buy the cement at higher prices. “We don’t mind buying cement at higher prices but the supplies have become a major constraint. Sometimes, the cement companies with whom we have agreements of long-term supplies do not honour the deal.”
The company has been importing cement from Pakistan. “This is not going to solve our problems. We cannot buy large quantities because we may incur huge losses if the consignment is spoiled withmoisture due to delays in the ports” A cement manufacturingfacility with a capacity of 1 million tonnes (mt) of ordinary Portland cement or 1.25mtof blended cement involvesan investment of aroundRs400 crore, said Ramesh Chandro, managing director of the city-based Coromandel Cements Ltd. “Raising funds is not an issue for setting up the cement facility. Today, each one of the construction companies (the firm is talking with) can cough up Rs25-50 crore to set up four-five small cement units and leave them to professionals to run,” said Reddy. He also pointed out that some construction firms such as the MyHome group already has a captive cement plant to meet its needs. Janapriya Engineers Syndicate Ltd, another Hyderabad-based construction firm, also has a captive cement factory.
IVRCL’s demand will be met with a 1mt facility that can deliver 20 million bags a year. The firm currently operates in infrastructure segments that include water and environment, transportation, buildings and industrial structures, and power. It has orders of Rs11,000 crore at the end of December. On 31 March last year, India’s installed cement capacity was 177.83mt, while production was 161.66mt, according to industry body Cement Manufacturers Association. Although an analyst called the construction firms’ strategy of entering cement manufacturing a smart move, he advised caution. “It takes at least two years to set up a cement unit. But by then, the country is likely to witness enough capacities, if not excess capacities, to meet the demand, since several existing players have gone in for expansion,” he said, on condition of anonymity.
Link to the article: http://www.livemint.com/2008/05/02224540/Hyderabad-builder-will-make-ce.html
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