Conart Engineers - debt free, cash rich infrastructure company

Conart Engineers is a civil construction company that has been in business since 1973. It is into construction of Industrial Building works (Textile Factories, Pharmaceuticals & Chemical Buildings), Commercial Complexes, Multi-Storied Residential Building involving Civil & Structural steel works, sanitary & plumbing works, Effluent Treatment Plants, Road works & Infrastructure works.

(Excerpt from

Their customer list includes:
ABB, Advani Oerlikon Ltd, Alstom Projects Ltd., Voltas Ltd, ABB, Asian Paints, General Motors, Gujarat Alkalies & Chemicals Limited, IPCL, Laffans Petrochemicals Ltd, Lupin Agricare Ltd, Parekh Platinum Ltd, Paushak Ltd (Darshak Ltd), Sabero Organics, United Phosphorus, Glaxo, JB Chemicals, Pune Municipal Transport, Gujarat Industries Power, Raymond Woollen Mills Ltd., Cadila Healthcare Ltd, Apollo Tyres Ltd, Bombardier Transportation India Ltd.

Nalanda International School was constructed by them.

For full list of 92 names see:

They are into civil construction and seem to have recently gone into Construction Project Management. This seems to be an area with better profit margins.

Sales and profitability

Their sales seem to have been erratic. From Rs.39.68 crores their sales slid to Rs.8.14 crores in 2014. Then in 2015, sales improved to Rs.19.11 crores. Their operating profit margins improved from 2.90% in 2011 to 9.10% in 2015. This may indicate that they are focusing on valued added projects. They seem to be transparent about their projects. Their website lists their past projects and future projects. The data available indicates that the average project size has been improving.

Order book

In their FY15 results sent to BSE, Conart Engineers mentioned having an order book of Rs.8.5 crores. Then in June-15, they reported sales of Rs. 5.86 crores and EBIDTA of Rs.66 lakhs.

Debt free and cash rich

They seem to be conservative about debt, which is unusual for an infrastructure company of any size. Their interest costs have come down from Rs.21 lakhs in 2013 to zero in March 15 quarter and June 15 quarter. They are debt free and have over Rs.5 crores cash on hand. They also seem to have good free cash generation.

The market cap is around Rs.9.35 crores. June quarter EPS was Rs.1.25 (non-annualized) and Rs.5 (annualized). The current market price is Rs.31.15.

See March results and June results:

March 2015

June 2015

Promoter stake and shareholders.

Promoter stake is 41.44%, up from 41.05% as of March 31, 2015. Management had a meeting on August 17, 2015 to decide on preferential allotment to promoters but deferred the decision. The stock price has gone up recently because of encouraging June quarter results from Rs.19 to around Rs.32 right now.


The management seems capable. It is a family run firm but run by people who seem very well qualified. It was started by Vinod Sura (1936-1999) who had BS, MS (USA) among his qualifications. Ramesh Sura and Jitendra Sura joined later. Right now Jitendra Sura runs it. He is a civil engineer. Tejas V Sura is the Joint MD and has done his Masters in Engineering from Pennsylvania State University, USA with a specialization on Construction Management. To read more about the management and see some pics of their projects read this:

Their registered office is in Mumbai at Khar. Their branch offices are at Vadodara and Ahmedabad.


The company seems to have some related party transactions including loans of about Rs.2 crores to a LLP controlled by promoters. This loan was interest bearing in 2014 and non-interest bearing in 2015. The auditors have commented on this in the March results notification to BSE.

See iii (a) in this document:

This is the major concern. Other than this, the company has not given dividend since 2010 when they gave a dividend of 10%. Its small size can also be a matter of concern. It is a microcap and such tiny companies and their performance can be unpredictable. Liquidity can be a concern if the company reports bad results and/or the market drops.

You can download annual reports from 2010 to 2014 here:

Their 2015 annual report will probably reach shareholders in a week or so.

Disclosure: I have invested in this stock. This is is not a recommendation to buy or sell. Please verify all information I have included above before taking a decision.

1 Like

This stock seems to be attracting buyers lately. Looks inexpensive even now at the current price of Rs.34.70. Has anyone invested? Did anyone attend the AGM?

Disclosure: I’ve invested in this.

Can we get some more information on this stock ??
Disclosure - need some more clarity before investing

No is there any specific reason for not a consistent behaviour in sales and also such old company at around 10 crores market cap . Is it a turnaround company or growth not being proper ?

Right now, all the information I have is in the original post. If I get anything else, I’ll add it here. Good luck.