I am following this company for a while.Interesting in terms of business prospects and potential in terms of market size etc.
About company:Control printers ltd, based in Mumbai (Maharashtra), provides
industrial grade coding and marking solutions to various industries such as
pharmaceuticals, personal care, food and beverages, metal, agrochemical and
extrusion products, such as pipes and wires. The company specialises in
providing solutions for printing variable information such as batch numbers,
manufacturing and expiry dates, maximum retail price, serial number, special
markings, logos, company/brand name, and barcodes.
Why Coding & Marking -http://www.controlprint.com/coding_marking.html The company manufactures and trades the printing
machines (30 to 35 per cent of revenues) required for the above
applications, provides consumables such as ink and spares (60 to 65 per cent of
revenues), and provides annual maintenance contract (AMC) services
(5 per cent of revenues) for the same.
The company manufactures the
printing machines under licenses from various companies such as KBA-Metronic AG
(Germany) for continuous inkjet (CIJ) printers under the alpha JET brand, and
Sisma (Italy) for large character inkjet printer. CPL has two manufacturing and
assembly facilities, one each in Vasai (Maharashtra) and Nalagarh (Himachal
Pradesh). The company also trades laser printers, which it directly imports
from Macsa ID, SA (Spain).
Previously the company under licence imports the printing machines and sold them to customers.Due to this heavy trading nature in Fy 09 it took heavy knock when Rupee depreciates heavily.The company completes new plant in Nalaghar in 2008 and starts complete manufacturing of printing machines and consumables.So if we keenly observe trading items reduced substantially from Fy08 to Fy 12.
Now company manufactures complete range of printers and consumables and imports laser printers only from Masca ID Spain.Company regularly pays Royalty for using technology and license.
From Fy 09 company growing 25 percent year on year and in one annual report chairman stated that industry itself growing double the GDP.With modern retail and consumer awareness these applications will have bright future.
Due to heavy capital expenditure and impact of forex in Fy09 ROE is quite low and improving year on year.
-Frequent equity dilution. Eventhough company having debt free status promoters issues preferential warrants and diluted equity four times in last four years.
-Heavy working capital.
-Irrational use of liquid resources.They invests cash in equities worth of 10 cr .
## No positions till now.. just tracking ..