YUKEN INDIA -RESULT UPDATE

I have recommended YUKEN INDIA @ Rs.140/- in March 2010 (Old Report can be accessed HERE) .Company came out with its ever best numbers in  September quarter with a turnover of Rs.38 Cr(Rs.26 Cr) and a net profit of Rs.3.24 Cr (Rs.1.74 Cr) .Half year EPS is Rs.15.25 v/s Rs.4.93. .It is expected to close the FY with an EPS about Rs.35 + .Currently it is trading @ Rs.292/- .Long term investors can still HOLD it .

YUKEN INDIA - RESULT UPDATE

Yuken India is one of our favorite stock which we recommended twice @ Rs.140/- and @ Rs.160/- in the past .Currently it is quoting around Rs.235/-.Company declared its first qtr result on Saturday. Below is the comparative figures with last year same qtr:

                             JUNE QTR 2010        JUNE QTR 2009

TURNOVER           28.73 Cr                    17.22 Cr

NET PROFIT         1.34 Cr                       LOSS OF 28 Lakhs


EPS                        Rs.4.47 /-                  - .87

Company's sales and profitability showing seasonal variations and historically June qtr is one of the weak qtr for the company .Even in such a qtr company performed well and raw material prices are stabilized now.Moreover company is planning a capex of Rs.15 Cr in near future to increase capacity and modernisation  .The entire funding will be through internal accruals and loans.Considering all these facts ,better days are expected ahead and one can HOLD it.

VELJAN DENISON Ltd - An unknown Gem

As in the case of Tasty Bite one year back ,some companies are
silent performers overlooked by investors and analysts community.
When such a company identified by some strong hands it will move
like rocket and multiplied in few trading sessions. Veljan Denison
seems to be such a company ,unknown to most of the investors.
Veljan is formerly known as Denison Hydraulics . This Company
is located at Hyderabad and promoted by Sri. V C Janardan Rao.
Mr Rao,is a qualified and experienced Engineer with
specialization in the area of Fluid Power.Weljan has promoted
with technical and financial assistance of Abex Corporation,
USA .In 1987 parent company ie, Abex corporation transferred
their interest in the Hydraulic Division to M/s. AB Hagglund & Soner
of Sweden and since then the Hydraulic Division came to be know
as Hagglunds Denison worldwide .This Swedish company is still
holding 13% shares in Veljan through Incentive Fastighet A B.
Indian promoter is holding 73.10% stake .This makes the total
promoter holding is 86.1% in this tiny capital company with total
capital of just 1.8 crore.This low equity base may be a reason
for the overlooking of investors towards this wonderful company.
Later the name of Indian company changed to Veljan Denison to
reflect the interest of Indian promoter too .


Denison is a well known name in hydraulic Industry. Its products span across Hydraulic Valves,Cylinders,Vane pumps and Pneumatic equipments.In reality this small company is the only one listed player offering a product list of more than 200 products related with hydraulic and pneumatic sectors.We may have another listed players like Kirloskar pneumatic,Atlas Copco,Yuken India,Dynamatic technologies ..etc making these type of products .But none of this single company offering this much products under single fold.Company is producing these products from its three manufacturing units in an around Hyderabad.Veljan has its own in-house R & D for product development , enhancement and expansion of product range.Growth of company’s products are closely related with the growth in industrialization. After a not so good year due to recession ,now company is returned to strong growth path.Company’s Financial year ending is in September.Last FY ,Veljan posted a turnover of Rs.41 crore net profit of Rs.4.46 Cr.and an EPS of Rs.26/- .After this bad performance of last year now in half year March itself company already posted an EPS of Rs.20/-. In march qtr itself Veljan posted an EPS of Rs.11/- v/s Rs.3/- in last year same qtr.In September full year it is expected to post an EPS more than Rs.50/-.Notable point is that ,company’s performance is improving steadily in each year(except last year).Company also increasing dividend payout and last year paid 50%on FV 10 shares.Its share price is now ruling around Rs. 375.Five year high is Rs.1044/ - touched in 2007 and lowest is Rs.160/- in last bear phase of 2009.Even from current level this may surprise,which is now trading at a P/E of 7 to the expected full year EPS v/s industrial average P/E of 30.

Yuken India Ltd - A Quality Pick

YIL a Bangalore based company from hydraulic space, promoted by   Yuken Kogyo Company Ltd  Japan in 1976. Its products are well known in the Industry mainly due to its quality standards. YIL’s product line includes various type of pumps,valves and controllers. Demand of hydraulic products are highly correlated with the over all industrial growth of the economy and it is highly sensitive. Due to sluggish growth in last year company could manage just 1 crore profit in March 2009 full year which converted into an EPS of Rs.3.3 on its small equity of  3 crore. But things changed rapidly with the growth of economy in this year and YIL posted an EPS of Rs.Rs.12/- for the nine month itself which is a four fold rise even  from last full year. Interesting fact is that the peek time of demand for the product of YIL is last quarter and traditionally company posting  major profit from fourth qtr  itself. Considering this fact , YIL is expected to post an EPS close to  Rs.20/- for the full year compared with RS.3/- last year. A clean and share holder friendly management  makes it a riskless buy even at Rs.140/-