INDSIL HYDRO POWER AND MANGANESE LTD.-Booming Business

Fortunes of Ferro alloy makers are always associated with the growth of Metal Industry,especially steel.India’s steel production is expected to touch record level in this year.This will surely help ferro chrome companies too.Indsil Hydro power and Manganese is a well managed mid size company from this sector.Indsil has two ferro chrome units ,one in Kerala and the other in Chattisgarh.Since it is a power intensive industry ,company also operating one mini hydel power plant and another coal fired power plant to reduce power cost .Earlier company took 50% stake in an Indonesian Manganese mining venture but later drops this plans and sold the stake due low quality of Manganese from that mine.Now company has signed an agreement for a 50:50 joint venture for the purpose of setting up a 75,000 tpy ferro chrome smelter in the Sultanate of Oman .This project is at a cost of Rs. 140 crores and is expected to operational by end of 2011.Due to crash in metal sector ,last year company posted muted result (NP of 2.8 crore.) With the revival in steel sector, now company is performing well and already posted a NP of 8.41 crore in the first nine month period of this FY which translates into an EPS of Rs.9/- ,full year EPS is expected @ 14/- .At CMP of Rs.76/- ,it is a decent BUY