WPIL - Worth a Look

WPIL is a Kolkata based manufacturer of various type pumps for sectors  like Irrigation,Mining,Water , waste water treatment..etc.What is unique for this company is that WPIL is the only company ( through joint venture) in India having expertise to manufacture certain type of pumps used in nuclear and thermal power plants.Earlier this company was with BN Khaithan group and in 2006 they completely exited from this company.The new owners( Hindustan Udyog group) have taken many steps to improve its performance thereafter.Some important acquisitions and some strategic alliances are already made in this direction.Company's joint venture with Clyde Union Pumps for manufacturing special pumps for  thermal plants and  nuclear power plants is expected to bring good business in future . In another important buyout ,WPIL recently acquired UK based  ' Mathers Foundry ' which makes  steel castings used in equipment for the oil and gas,nuclear, paper, chemical and power generation sectors .Mathers is the sole manufacturer of castings in the ZERON range of Super Duplex alloys . ZERON is a  super duplex stainless steel (with  high strength and  corrosion resistant ) that resists all forms of corrosion attack in seawater service.WPIL's thrust in waste water treatment , mining and power plant related pumping systems creating special attention among many other pump makers. After the change in management control company is showing steady growth. For the last FY , WPIL posted a turnover of Rs.220 Cr and a net profit of Rs.15.7 Cr.On an equity base of Rs.7.9 Cr EPS was Rs.20/- .Another encouraging factor is the aggressive open market purchase of promoters in the recent past .  CMP is Rs.187/-

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EASTERN GASES LTD . - Policy Changes may Change its Fortune.

Reduction in the subsidy on LPG and rationing of the subsidized LPG Cylinders for consumers will be a reality in near future.Talk on this subject is already on and it may take shape eventually.Who will benefit from such a scenario - no doubt it is private LPG distributors. When the difference of the cost of LPG cylinders distributed by PSU's and private players become nil or negligible Private LPG distributors will get a chance to compete with PSU's and increase their market share. When we look into the investment angle of this possible changes , we have not much choices left .Only very few private LPG distributors are available in listed space. EASTERN GAS - is one such company from Kolkatta which is not very popular for investor fraternity till now.Eastern gas is currently concentrating in distributing commercial Cylinder under the brand name ' EAST GAS' in Kolkata and nearby areas. It is distributing LPG in 17 and 33 kg commercial cylinders .Since the subsidy is very huge for non commercial cylinders, at present it is not viable to distribute home cylinders in a big way .But the situation will change when there is a reduction in subsidy as mentioned above. Company having a 30,000 MT / month LPG refilling plant at Durpagur.Eastern Gas also having a marketing agreement with Indian Oil Petronas Private Limited. Company is also in Auto LPG Segment and planning to start 100 auto LPG filling stations in few years.It also having plans to start joint ventures for city gas distribution . All together , policy changes in this sector is expected to change in favor of Private LPG distributors. Number of listed companies from this space is very few . Hence , once there is some clarity emerges in this sector, first comers with necessary infrastructure will benefit a lot and in such a situation Easter Gas may turn as a dark horse .For the last financial year Eastern Gas posted a turnover of Rs.90 Cr v/s Rs.63 Cr and a net profit of Rs.1 Cr v/s 63 Lac. At CMP of Rs.18/ - nothing to loose .

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GANDHIMATHI APPLIANCES - HOLD

More than once I have recommended this scrip from Rs.73 /- level onwards .Currently it is trading around Rs.320/- which is close to its all time high. High risk takers can still hold it and low to medium risk takers may book partial profit at current level.

Old Reports can be accessed HERE and HERE

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RAMKY INFRASTRUCTURE LTD - BUY

Ramky Infrastructure is in the field of construction and Infrastructure since 1994. This company is jointly promoted by Alla Ayodya Rami Reddy and Y R Nagaraja . Company is concentrating in water and waste water, irrigation, transportation, power, Road building & industrial construction activities . Company having good experience in water and waste water related  projects and already completed more than 100 projects in this segment.More than half of its top line is generated from water, waste water and irrigation related activities and this sector having very good potential.Company's own designing and  engineering team which specializing in this field is an added advantage.Through its subsidiaries and SPV's , Ramky is operating out side India and currently executing some projects like Gabon Special Economic Zone, West Africa ..etc through its subsidiary.Company is also active in many road projects pan India.Recently company received orders worth Rs.600 Cr for various infrastructure development projects. Currently company having an order book of Rs.12000 Cr which gives very good visibility.Ramky shows a CAGR of 40 % for the past 5 years.On a consolidated basis Company posted a turnover of Rs.3147 Cr  , net profit of Rs.206 Cr and an EPS of Rs.39 in last FY. Company issued share at Rs.450/- in its IPO and due to lower valuation of infrastructure company's in current market it is available @ Rs.280/- I think Ramky Infra is one of the best bet from infra space and it will out perform with  a re- rating in this sector .Investors can  bet on this with a long term view at CMP of Rs.280/-

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BIRLA PACIFIC MEDSPA - ?????

Lead Manager of these type public issues should be banned and prosecuted to save Investors .

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NILKAMAL LTD / WIM PLAST LTD - Due for a Re- rating .

Even if there is different  opinions on Plastic , consumption of the same is surging every year. Convenience and low cost is the main reason for the growth of this sector .There is lot of plastic related product manufacturers in our country especially in unorganized sector.But they are not much bothered about branding and value addition.Nilkamal and Wimplast are two big players in branded and value added category in India . On conventional valuation parameters both these companies are qualifying for an  investment.Currently many of the companies from this sector other than VIP Industries are ignored by the market players . Both these company's financials are very solid and paying good dividend . I feels , in future there is every chance for a re rating in these companies as happened in kitchenware companies like TTK Prestige and Hawkins... Indian consumption theme is expected to auger well for these companies too in long run.

Wimplast - makers of CELLO brand -posted a turnover of Rs.158 Cr and a net profit of Rs.18 Cr . On an equity base of Rs.6 Cr it posted an EPS of Rs.30 in FY 2011. At current market price of Rs.200/-,Wimplast is trading at a P/E multiple of  6.6


Nilkamal  is the biggest player which posted a turnover of Rs.1252 Cr and a net profit of Rs.52 Cr . On an equity base of Rs.15 Cr it posted an EPS of Rs.37 in FY 2011.Company is rapidly expanding and its retail venture named @Home ( a one stop shop for all home needs) posted turnaround performance in FY 2011.

Both these company's are suitable for investors with medium to long term. Keep watching the raw material cost which is subject to the changes in crude price

CMP of Wimplast is Rs.202/- and Nilkamal is Rs.264/-

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INDAG RUBBER - BUY

Indag Rubber is a Khemka Group company mainly engaged in the manufacturing of tread rubber for auto sector.  It makes  pre-cured tread rubber (PTR), rubber strip gum, universal spray cement and tyre envelops ..etc  Company having two manufacturing units , one in Himachal Pradesh and other in Rajastan . Indag is the company which introduced cold retreading technology in India . Company's financials are strong with minimum debt and higher promoter stake. Last year company expanded its capacity at Himachal unit and current capacity from this unit alone is 1200 ton tread rubber and 1800 ton rubber gum. Cost of raw material was a big problem for this company in recent past . But the US decision to discontinue the easy money policy for the time being is expected to bring down commodity prices in near future. Natural rubber prices are showing some weakness and it it expected to show this trend in coming months .If this trend continuous ,  it will surely help Indag to improve its margins. For the financial year ended March 2011 , Company posted a turnover of Rs.150 Cr and a net profit of Rs.11 Cr.Full year EPS was Rs.20 . At CMP of Rs.95 , Indag is trading at a P/E multiple of  just 4.75  which is a risk less bet at CMP . Keep watching the  movement of the cost of raw materials closely.

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