Saturday, June 30, 2012

ROTO PUMPS LTD - BUY

 
 Roto Pumps ( BSE - 517500) 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.Recently company started a subsidiary in Germany .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. More than  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 this will reflect in the near future.
This is one of the cheaply valued listed player in this sector compared with KSB Pumps,
WPIL,Kirloskar ,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.76 crore and a net profit of Rs7.28 crore and an EPS of RS.24/- .On a continuous
basis ,for the past five years company steadily increasing its sales and net profit and
paying dividend without any interruption.Even in a difficult time for its user industries
company performed well.With a P/E multiple of just 4,Roto Pump is a safe bet for steady
return.CMP is Rs.99/-

25 comments :

  1. Dear Sir,

    I eagerly wait for weekend to see your multibagger tips. Really good work sir !!
    I have a query. Shakthi pump and Roto pump both are available at PE of 4.21 . Which has more future prospect. And I have some holding in Yuken and Shakti pumps. Should i continue my holding.

    ReplyDelete
    Replies
    1. Dear Abhi
      Nothing wrong in holding Shakti Pumps and Yuken.Chances for an up move is more if the floating stock is low ( if all other factors are same.)

      Delete
  2. dear value
    do u still confident about vulcan engineering?
    PATIDAR

    ReplyDelete
  3. Suitable for an investor having patience to wait 3-5 years.

    ReplyDelete
  4. shall one average webel solar?

    ReplyDelete
  5. Dear Friend
    I have mentioned my opinion on Webel more than 5 times even in recent past as answer for readers comment.Better to wait for the details of CDR.

    ReplyDelete
  6. sir,

    Your opinion on WATER sector companies like VA TECH WABAG.

    ReplyDelete
  7. Dear Sir,

    Really i am impressed very much regarding your recommendations. You recommended Vulcan Engineers @ Rs. 44 level as a potential multibagger. But this stock declined sharply and it is trading around @ 28 levels. I am interested to buy this stock. Please reply your opinion about this stock.

    Thank You,
    dhanush

    ReplyDelete
    Replies
    1. Dear Dhanush
      Average it if it falls below Rs.25 if you have a long term view.

      Delete
    2. Thank you very much for your immediate reply...

      Delete
  8. Dear Sir,
    What do you think of Infinite Computer Solutions in the term of 3-6 months?

    ReplyDelete
  9. Dear Sir,

    Pls give your views on heritage foods.

    Rz,
    Shanid.V.H

    ReplyDelete
    Replies
    1. No change in my previous views on Heritage food

      Delete
  10. Your recommendation Igarashi motor made some significant gain today.
    Whats the reason behind it apart from agile electric investment in it. Is Igarashi motors going to be merged with Bosch

    ReplyDelete
    Replies
    1. I believe every company will reach its desired price today or tomorrow.Patience is the key..

      Delete
  11. DEAR VALUE
    AFTER NO MOVEMENT IN STOCK PRICE, DO U STILL BELIEVE THAT TATA CHEMICAL IS "LAMBI RACE KA GHODA"
    PATIDAR

    ReplyDelete
    Replies
    1. No movement in stock price alone is not a reason to change my view on any stock.

      Delete
  12. hi,

    how would you rate Aptech as stock , is it worth entering at the current level or if already bought is it worth holding on to it.

    ReplyDelete
    Replies
    1. Not seeing anything special in Aptech.RJ may try to exit at higher level , but I am not enthused by its business model.

      Delete
  13. Hi,
    What is your opinion about UMANG DAIRIES at current market price.Does it multibagger in future?

    ReplyDelete
  14. Have you checked their employee costs? Promoters are paying themselves close to Rs. 1.4 crore (+ dividends - which is fine). This is as per their 2010-11 balance sheet. Do small caps generally have such high payouts (increased y-o-y by 20% - again as per 2010-11 B/S). Seemed quite high on a profit of Rs. 5.3 crore (FY11). Do let us know your views. Good to note the high RONWs over the past 5 years. Thanks for d idea. Awaiting their latest B/S.

    ReplyDelete
  15. Hi VP ,

    Can i know your current status on ROTO Pumps ?? , since i bought this at 52 week high price..can i hold and wait for long run ?? Please suggest

    ReplyDelete

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