VEEJAY LAKSHMI ENGINEERING WORKS Ltd (BSE CODE 522267) - BUY

After a long period ,textiles companies are making big  profits due to good demand  and better realization. Improvement in their bottom line will surely translate into more expansion and modernization programmes . This will surely improve the prospects of textile machinery makers going forward. Veejay Lakshmi Engineering Works Ltd (VLEWL)  is a Coimbatore based textile machinery manufacturer started operations in 1974.Its products list includes Two-For-One twisters, Automatic cone Winders ,Precision Propeller winders, Random Assembly Winder ..etc For the past many years ,company’s performance was badly affected due sluggish demand which is now reviving . Any decision to continue the presently suspended TUFS will be an added advantage for textile machinery sector as a whole. For the half year ended September 2010 , company posted  a turnover of  Rs.50 Cr (Rs.29 Cr) and a net profit of Rs.2 Cr (Loss of Rs.1 Cr) and an EPS of Rs.4.13 /- . Medium to long term investors may consider a  BUY at CMP of  Rs.76/-

SALONA COTSPIN

Due to the easing of recessionary pressure from
western economies ,Companies from textile
and related sectors are expected to perform
well in near future . Salona Cotspin
is a Tamilnadu  based company engaged in the
manufacturing of Cotton Yarn and Knitted fabrics.
Out of company's total sales, 41% income is
generated from Cotton yarn , 39% from
Knitted fabrics and balance from other
related products.Company is  planning to
expand its spindle capacity from 21744 to
24336 in near future and also planning to
increase the generation of wind energy to
reduce cost and ensure continuous supply
of power.For the financial year ended
March 2010 ,company posted a turnover
of Rs.55 Cr and a net profit of Rs.2.26 Cr
v/s a net profit of Rs.13 lac for
the last year. For the three months ended
June qtr of this FY ,sales is Rs.18 Cr  and
profit is Rs 1.25 Cr .On an
equity base of 5.32 Crore qtr EPS is
Rs.2.35.Company is expected to perform well
in near future .Even if company
is currently trading near its 52 week high ,
based on the expected full year performance
there is reasonable chance
for further upside.Movements in cotton
prices and power cut in TN are two factors
to watch.Currently it is trading around Rs.29/-