KSB PUMPS LTD - TO PUMP YOUR PORTFOLIO

KSB Pumps Ltd   jointly  promoted by Lein Schanzlin & Becker A.G. of  West Germany and India based Industrial & Prudential Investment Co. Ltd in 1960.Currently the foreign holding is held by Canadian Kay Pump Ltd an associate company of KSB Germany.Company manufacturing various type of pumps  and valves for industries like water treatment ,chemical,mining ,oil ,power generation ,sewage ,nuclear power and for Agriculture.Company having five manufacturing plants  in India, Pune and Sinnar manufacturing facilities makes pumps for  irrigation and power projects, Nashik plant manufacturing multistage pumps, water and submersible motor pumps.Its valve manufacturing facility is located at Coimbatore and captive foundry at  Ahmednagar .KSB started manufacturing of  pumps for nuclear industry in 1977 from its factory located at  MIDC Industrial area in Pimpri and signed and exclusive long term agreement with NTPC in 1988. Company having very good brand image and known as a quality producer of pumps for irrigation  purpose.In power and petrochemical sector competition is less due to the mandatory adherence of American Petroleum Institute standards. KSB also executing  turnkey projects  for industrial and agriculture purpose.Due to over all sluggishness in the user industries company’s last year was muted  and cash flow was not satisfactory.But even fighting with the tough situation in local market ,this year company improving its performance .Increased off take by its parent company KSB AG is also helping to improve its performance.For the FY 2012 ,KSB posted a turnover of Rs.751 Cr and a net profit of 43 Cr.In latest June quarter company recorded a Sales of Rs.190 Cr and a net profit of Rs.17.5 Cr . The most attractive part of this company is the quality of its operations , not only in its products but in corporate governance  and minority  share holder friendly attitude too.Company having  an uninterrupted dividend paying record  and issued bonus shares to its share holders in the years 1983,1986,1989,1996 and recently in last year.I believe this MNC company will be an out performer when there is  a re rating in capital good/engineering industry  and one of the best mid/small cap stock to hold even in your core portfolio. KSB is listed both in NSE and BSE and CMP is Rs.212 /-

Link to the company website HERE

Link to latest AR. HERE

ROTO PUMPS Ltd -BUY

Roto Pumps started its operations in 1968 as a

producer of progressive cavity pumps , whose

demand met by import till then.

Company  also producing Twin Screw pumps and

Centrifugal pumps in its two most modern facilities

located at Noida.Roto distributing its products

around the globe and it has marketing offices in

Australia and UK. Company also having

strong marketing network in India.Progressive

cavity pumps are used to pump liquids with high

solid content and flow needs to be controlled .These

type of pumps are generally used in industries like

Beverages,Pharma,Food processing,dairy,Effluent and

sewage treatment and mining etc..Other type of

pumps made by the company are used in sectors

like irrigation,agriculture..etc. Half of its sales

coming from export and this itself is a testimony

for the quality of Roto’s products.Roto is going

through a capacity expansion programme and the

benefits of it will reflect in the near future.

Now company’s customers are posting good business

which will help the company too.This is one of the

cheaply valued listed player in this sector compared

with KSB Pumps,WPIL,Kirloskar Brothers,Sakthi Pumps

..etc . Roto has  a tiny equity base of 3 crore where

promoters are holding almost 70%.Last year company

posted a turnover of Rs.52 crore and a net profit

of Rs.3.3 crore and an EPS of RS.10.7 .On a continuous

basis ,for the past four years company increasing

its sales and net profit.For the nine month ended

Dec.2009 ,Roto posted an EPS of Rs.8.70/- and expected

to close the full year with around Rs.12/-.Currently it

is trading around Rs.80/- with P/E of below 7 compared

with industry p/e of 30-40.A good Buy for medium term .

Raw material price is a major factor to watch.