Kalpataru Power Transmission
The share price of Kalpataru Power (Code: 522287) (Rs.83.15) has fallen considerably in the last 2-3 months and hit a new 52-week low of Rs.75. This is a good opportunity for long-term investors to buy at current levels and accumulate more at declines. The company has bagged two big orders worth Rs.660 crore on Friday, 29 June 2012, of which one is from Thailand for Rs.280 crore The company is one of India's largest engineering, procurement and construction (EPS) companies that provide integrated services to the power transmission & distribution industry. It has successfully established a pan India presence, which is complemented by its international presence in 31 countries across the globe. It is primarily engaged in design, testing, fabrication, galvanizing, erection & construction of towers up to 1200 kV, transmission lines and substation structures on a turnkey basis. Its manufacturing facility in Gandhinagar, Gujarat, has an installed capacity of 108,000 metric tonnes. The facility is also equipped with a tower testing centre, which is ranked as one of the largest across the globe. Besides, the company executes EPC projects for laying cross country gas & oil pipelines and city gas distribution network. With the recent completion of 544 km pipe-laying work for the Mundra - Bhatinda project, it can boast of completion of 2,200 kms of pipe laying work for almost all the oil & gas utilities of India, within a short span of 5 years. Moreover, the company has interest in biomass energy generation, civil construction, logistics & warehousing and real estate development through its several subsidiary companies. In 2010, it ventured into the railway business offering services of laying new railways lines, metro railways, private railway sidings, dual gauging, signalling & telecommunications, OHE & general electric works. In FY11, it achieved a major breakthrough in railway EPC work by winning 5 projects under joint ventures, including one international project. To maintain the growth momentum, it has planned a greenfield expansion of 30,000 MT at Raipur in Chhattisgarh, which will enhance its tower manufacturing capacity to 1,38,000 TPA. In FY12, the company and its subsidiaries achieved significant success in winning projects under the PPP model and presently have a portfolio of three Build Own Operate Transfer (BOOT) projects - one in transmission and two in roads. It has also increased its stake to 67.19% in JMC Projects through preferential allotment and open offer. As on 31 March 2012, its consolidated order book stood at Rs.11,600 crore of which Rs.6,100 crore is its standalone order and the rest is of JMC Projects. For FY12, its consolidated revenue rose by 22% to Rs.5,308 crore whereas PAT was almost flat at Rs.204 crore posting an EPS of over Rs.13 on its equity of Rs.30.70 crore having face value of Rs.2 per share. At the current market cap of Rs.1300 crore, it is trading at a P/E multiple of 6.3, which is fairly cheap. Its share price can appreciate 50% within a year.
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