The present form of EON ELECTRIC is the result of two de-mergers during past two years. This company (formerly known as INDO ASIAN FUSEGEAR) sold its Switch Gear business to French electric equipment maker Legrand for a consideration close to Rs.500 Cr in 2010.Later in 2011 ,company de-merged its metering business into another company named Advance Metering Technology.After both of these transactions company is left with lighting products, wires and wiring accessories , cables and Fan.Now company is concentrating its efforts to develop many new energy efficient products in these categories.LED lighting products is one among them . Since LED is not using any hazardous materials like mercury it is expected to get consumers priority over CFL in coming years .For getting advanced technology in this field ,EON already tied-up with one Japanese and another European company operating in this field.Recently company ventured into home automation products with the introduction of modular switches .Company’s R & D division introduced indigenously developed presence sensor technology based lighting accessories to save energy.Recently company started production of Lithium Ion Batteries from its newly set up plant in Haridwar. Company is claiming this is the first such manufacturing facility in India to produce Lithium Ion batteries to be used in mobile handsets, laptops, cameras, tablets ..etc which is still now imported from China.Company is expecting to garner reasonable market share in this products based on superior quality over cheap Chinese products.
Even the company not started to show black in its bottom line after the selling of its Switch Gear division and de- merging of metering business, sharp improvement is visible in its turnover and reduction in loss in recent times ( See Table below)
Out of the total amount received from the selling of Switch Gear division, company distributed Rs.10/- per share as special dividend,came out with a buy back program at a maximum price of Rs.130/- per share and most importantly paid back majority of its debt.After the scheme of later de-merger ,on a rough estimate company is still with a cash balance over Rs.100 Cr where the market capitalisation of this company is is just Rs.48 Cr . I believe the well knitted marketing network and well experienced promoters are two big positive factors for this company .EON having enough cash to utilise the available opportunities and the company is already started its capex .I am expecting the company can back to black in another few quarters and at current market price of Rs.30/- it is worth for a bet for investors with some risk appetite.Stock is listed both in NSE and BSE.
Out of the total amount received from the selling of Switch Gear division, company distributed Rs.10/- per share as special dividend,came out with a buy back program at a maximum price of Rs.130/- per share and most importantly paid back majority of its debt.After the scheme of later de-merger ,on a rough estimate company is still with a cash balance over Rs.100 Cr where the market capitalisation of this company is is just Rs.48 Cr . I believe the well knitted marketing network and well experienced promoters are two big positive factors for this company .EON having enough cash to utilise the available opportunities and the company is already started its capex .I am expecting the company can back to black in another few quarters and at current market price of Rs.30/- it is worth for a bet for investors with some risk appetite.Stock is listed both in NSE and BSE.
Link to Company website HERE
Link for latest Annual Report HERE
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