Srikalahasthi Pipes - Can it continue on its growth trajectory?


(Rohit8546) #42

Any1 who is still invested can throw some light on its prospects and according to financials its worth buying it seems…i just wanted to knw frm person invested in this is there any change due to nclt bidding of electrosteel steel


(Ayush Mittal) #43

Latest Credit rating report - http://www.careratings.com/upload/CompanyFiles/PR/Srikalahasthi%20Pipes%20Limited-07-06-2018.pdf

Key highlights:

  • Established position of group in DI Pipe segment with favorable location of plant. With limited players in this area, co enjoys a high market share and advantage in freight cost.
  • SPL reported 21% volume growth in FY18. Capacity utilization was 92%.
  • Margins got affected from 20.23% in FY17 to 16.19% in FY18 due to rise in raw material prices.
  • SPL raised 250 Cr via QIP in Dec 2017. Gearing is down to 0.33x vs 0.70 on March 2017. Comfortable liquidity position of 450 Cr.

(fillic2002) #45

do we know if there is some news in market and not in public domain… as the price looks to be cheap for this company… then why its falling so sharp

A small observation… they have a huge cash receivable… not sure if there income got stalled in here… if so we should be more careful…


(vivekp) #46

from 2017 AR :slight_smile: " There is no material credit loss for the past five financial years except for the non-acceptance of claim by the customers for price escalation. During the year Rs. 14.87 lakhs (previous year Rs. Nil) has been considered for the impairment allowance on account of the same. The Company does not anticipate any other credit loss in future with regard to the trade receivables as at 31 March 2017.
The concentration of credit risk is limited due to the customer base being backed by the government order and unrelated."

Don’t think there would be a sudden Receivable issue when there was none for 5 financial years . It doesn’t mean can’t happen but from 0 to any substantial amount can’t happen within a year .


(vivekp) #47

@ayushmit sir u are the senior what is your interpretation of this fall . Couldn’t find any contra view in credit report or last quarter statement . Have u attended the last conference call by management ; ur views or red flags any ?


(Ayush Mittal) #48

Hi,

There is nothing like junior senior. Markets continue to teach us and we all are just students.

I haven’t been able to understand the reason for the fall. Maybe something to do with the promoter quality given that it’s backed by electrosteel group. Given the resolution of electrosteel given acquisition by Vedanta, i was expecting things to ease but that doesn’t seem to be happening.

The last concall was pretty positive and as the company had raised about 250 Cr via QIP, I felt the debt risk has also come down.


(vinay_new07) #49

Even I am unable to understand the reason for the fall. All the fundamentals seem intact, with capacity expansion to facilitate future growth. The QIP price was almost 2 times the current price. The dividend yield is about 2.50% and there is nothing to suggest any exceptional change in the last few quarters.

I am probably going to hold. It’s at 7 PE with about 400Cr in Cash and Bank. No reason to get into market panics.


(cool_gaurav) #50

Bro, it’s negative market sentiment that is prevailing over the fundamentals and nothing more than that. Co. with good fundamentals & strong presence in DI pipes (hardly, two good companies) will not shut tomorrow. We need to have patience and In long run, fundamentals will prevail over short term volatility. Holdings of Big investors like Dolly and Anil are intact as per current SHP.


(Raj A A) #51

Sri kalahasthi management clarifies on Auditor change rumour


(sougataG) #52

http://equitybulls.com/admin/news2006/news_det.asp?id=232532


(girierakam) #53

Announcement By Srikalahasthi Pipe in BSE:

We understand that the rumor/message is being spread among investor community that the Auditors of our Company have resigned and the company has also received e-mails from certain shareholders in this regard. In this connection, we would like to submit that M/s. Lodha & Co., Chartered Accountants have been appointed as Statutory Auditors of the Company in the Annual General Meeting held on 27th September, 2017 and they have audited the Accounts of the Company for the year ended 31st March, 2018. Ms/ Lodha & Co are also now reviewing our quarterly financial results for the quarter ended 30th June, 2018, which will be approved at the ensuing Board Meeting of the Company to be held on 30th July, 2018 for publication.
In view of the above we would like to clarify that that rumor being spread among the investor community is incorrect and baseless.


(Raj A A) #54

Q1 results : PBT is 21.17 cr against 50.32 cr for correcsponding qtr last yr.


(vivekp) #55

poor corp governance . Material information should have been disclosed earlier . Also too much expansion going on & planning . Need to see few quarters down the line how it materialises .


(cool_gaurav) #56

Hmm… 12 days shut down they should have disclosed… However, they have disclosed their intention to buy Rs.1 crore worth share post trading window open on 2nd August …


(vivekp) #57

1 cr each . 2 cr in total . Minuscule amount .Increased to 4cr .


(vivekp) #58

@ayushmit I just wanted to confirm . In the last concall ur query on debt was responded by management as 480+ cr .But AR 2018 shows 363 cr . DO I remember it correctly or some error on my part .


(Ayush Mittal) #59

I think the number was 350 Cr + 60 Cr


(sachit) #60

Did anyone attend the AGM? Would appreciate some brief notes if so.

Thanks in advance


(Amit) #61

Great results.

  1. The Company has achieved higher quarterly production of 79,569 tonnes during the quarter ended 30th September, 2018, as compared to 66,822 tonnes which is higher by about 20% vis-a-vis corresponding quarter of the previous year.

  2. Considering the current pace of production, the Company would be able to make good the production loss suffered in Q1 of FY2019.

  3. In spite of increased top-line, the net profit of the Company is lower by about 9% as compared to quarter ended Sep, 2017, which is mainly attributable to higher cost of coking coal, iron ore, unprecedented depreciation of rupee vis-a-vis US Dollar and lower sales realization.

  4. FerroAlloys project is already under implementation and it is expected that 1st furnace will be commissioned by September, 2019 and the 2nd furnace by December, 2019. The 1200 mm dia D I Pipes Productions facility is progressing as planned.

  5. Government’s focus on infrastructural projects in the country, investments in water infrastructure development, improving sanitation coverage across the country and use of DI Pipes in irrigation sector, the Company is optimistic of maintaining its comfortable order book.

Disc: Invested and biased.


(Ayush Mittal) #62

Yes, good to see the company coming back. If one goes through the concall of Tata Metalliks, its evident that the margins have been under pressure and the industry has been increasing prices. So hopefully the margins should also improve in coming quarter.

The valuations look pretty attractive at these levels.

Regards,
Ayush
Disc: Invested