ADVANTA INDIA - RESULT UPDATE

On a consolidated basis company posted a turnover of Rs.255 Cr v/s Rs.176 Cr and a net Profit of Rs.13 Cr v/s a Loss of Rs.3.45 Cr .EPS is Rs.7.9/  , for March quarter. Recommending to HOLD

HEG LTD - BUY

HEG Ltd  - one of the largest producers of Graphite Electrodes in Asia ,is a member of LNJ Bhilwara Group.Graphite Electrode is using to produce Steel through Electric Arc Furnace Route .Needle Coke is the raw material for producing Graphite Electrode.Company having a manufacturing capacity of  66,000 MT P/A and about 80 % of this is exporting to various countries.Company is supplying about 8 % of total world production of Graphite Electrode.Worldwide 35% of steel is produced through Electric Arc Furnace Route.Its customer list includes include Arcelormittal, Nucor ,Posco, Megasa Evraz,Hyundai Steel ,Tata Steel ..etc It is a  power intensive industry where 5000 unit power is needed to produce one ton of graphite electrode.In such an industry HEG’s 77 MW captive power plant is a big positive. Due to revival in demand and price in recent times , HEG is now increasing its production capacity from 66000 ton to 80000 ton P/A.The demand scenario is improving worldwide and company is expected to benefit a lot going forward.For the December quarter HEG Posted a sales of Rs.418 Cr and a net profit of Rs.25 Cr .Recently company concluded a Buy Back of its own shares at a cost of Rs.67 Cr.In addition to this buy back ,promoters are hiking their stake very aggressively through open market purchases.Considering HEG’s leadership position in this industry and improving prospects of business ,recommending a Buy at CMP Rs.218/- for long term investment.

NITCO - SELL

I have recommended a BUY on NITCO last year @ Rs,62/-. After hitting a high of Rs.71/- ,currently it is trading around Rs.40/-. Due to poor fourth quarter performance , recommending to SELL at CMP and book loss.

EPC INDUSTRIE Ltd - RESULT UPDATE

For the latest March quarter , company posted a turnover of  Rs.39 Cr v/s Rs.20 Cr and a net profit of Rs.2.76 Cr v/s Rs.19 Lakhs .In 2011-12 full year company recorded a sale of Rs.125 Cr v/s Rs.87 Cr and a net profit of Rs.6.66 Cr v/s Rs.1.43 Cr .Today EPC quoted Ex-Rights basis @ Rs.115/- .Recommending to HOLD for long term.

BHARAT GEARS LTD - BUY

Bharat Gears Ltd(BGL) is one of the largest Gear manufacturer in India.This company was originally promoted by Raunaq and company in 1971.Company is operating with three business divisions- Gears,Furnaces and Automotive components. Now BGL having two manufacturing facilities and planning to add one more in Maharastra. BGL’s total gear manufacturing capacity is divided as 6 lac units of Hypoid Ring Gear & Pinion ,10 Lac Differential Gears & Crosses and 22 lac  Transmission Gears .It is one of the major suppliers of gears to tractor industry with customers like Escorts,John Deere,M&M TAFE,Carraro..etc . In the non farm segments BGL’s customer list includes Ashok Leyland,Tata Motors,JCB,Toyota Kirloskar ..etc .In addition to gear business BGL also in heat-treating furnace systems with  technical collaboration of  AFC-Holcroft of USA. Out of the total sales ,about 90% is coming from Gear segment.Company supplying 80% of its gears to OEM’s and  selling the rest in replacement market.After a long period of slow growth now company is moving with pace.BGL already crossed the last full year profit figures in just 9 months of this FY even excluding other income.Normally fourth quarter figures are the best for the company .Based on the prediction  of normal monsoon for this year also tractor demand is expected to improve .This will positively impact company’s sales .In addition to this, benefits from the capacity expansion and  sales from new manufacturing facility will add to its bottom line in next few years.Increase in raw material cost is a factor to watch .Considering all these factors ,BGL is expected to post a Sales around Rs.430 Cr and a net profit of Rs.15 Cr in this FY.It may post an EPS around Rs.20/- .At current market price of Rs.80/- BGL is trading with a market capitalization of just 62 Cr which is very low for a market leader with turnover of more than Rs.400 cr. BUY BGL  at CMP of Rs.80/- which is trading both in NSE and BSE.

IGARASHI MOTORS INDIA LTD -BACK TO BETTER DAYS ?

CG Igarshi Motors is originally promoted as a joint venture between Crompton Greaves Ltd., Igarashi Electric Works Ltd., Japan and International Components Corporation, USA.But now all these original promoters are out of the court and this company is presently owned by the promoters  of another BSE listed company HBL Power Systems through Agile Electric. Old promoters – Igarshi electric Works – holding just  17 % and re categorized as non promoters.This company is in the production of Permanent Magnet Micromotors and allied components.These type micro motors are used in automobiles, power tools,toys and other household appliances.Company is supplying its products to major customers like Bosch, Delphi, Visteon, Mikuni..etc. Company’s 45% sales is coming from USA,27% from Europe and 28% from Asia region.CGIM also having a joint venture with Bosch India to produce electric motors.With revival in US auto market ,company posted good performance in latest quarter .A favorable change in Rupee value is also helping to earn better margins  through exports.For the quarter ended March ,Company posted a turnover of Rs.74 Cr v/s Rs.52 Cr and a net profit of Rs.6.6 Cr v/s Rs.1 Cr . Chances of re-rating is there  from CMP of Rs. 50/-

GRANULES INDIA - RESULT UPDATE

  Granules India recommended as a BUY in last month @ Rs.79 /-( For old posting Click HERE ) ,today hits its 52 week high @ Rs.106 /- .      For the quarter ended March 2011,company posted a sales of Rs.188 Cr v/s Rs.120 Cr and a net profit of Rs.16 Cr v/s Rs.9 Cr (almost 85 % up) .Full benefit of its expansion will start to reflect from next year onwards.HOLD for long term.

VULCAN ENGINEERS / EPC INDUSTRIE - UPDATES

With effect from April 27, Vulcan Engineers and EPC Industrie will be shifted to 'T' Group  and would attract a circuit filter of 5%. This decision will not make any material change in Company's fundamentals and only because of price movement .For more details about the Criteria of Group Change - Click HERE.

EPC INDUSTRIE - RIGHTS ISSUE UPDATE

EPC INDUSTRIE LTD is one of my recommendation @ Rs.61/- ( For Old Posing Click HERE) which is now trading at Rs.150/-.Now company declared the terms of much awaited Rights Issue as follows:

- Ratio: 3 (three) new Equity Shares for every 5 (Five) existing Equity Shares

- Issue price per Equity Share: Rs. 40/- per share

- Face value: Rs. 10/- per share

- Premium: Rs. 30/- per share

- Size of the issue: Rs. 41.43 Crore.


Subscribe the rights which is offered at substantial discount to current Market Price and HOLD this M& M group company  for further gains in long term