The stock has been on upper circuit since last four to five trading session.i.e. since the release of this report. So actually it has gained at least 20% in last four days.
eimco elecon AR fy17 notes
Topline up by 26%
PBT up by 26%
PAT up by 43%
5 rs dividend
Debt free
74% promoter holding of which 25% is owned by MNC
MFâs hold 4.79%
CIL has targeted for a big leap in the production (approx. 19%) this year to compensate for the last yearâs slow growth.
The pressure on the coal subsidiaries to reduce the production cost is forcing them to think about newer technology. This is going to create increased demand for the mass production of machines with ease of selective mining. This opens up a big market for the equipment manufacturers and scope of innovations suiting to the Indian coal deposits and geological challenges.
With the Governmentâs constant impetus on infrastructure, the construction equipment industry has started showing signs of growth from the continuous falling trend of last three to four years. The Government has instilled a positive outlook in the country by reviving stalled
infrastructure projects, announcing new projects and is also allocating huge investments in infrastructure industry. Also, the major growth drivers for construction equipment industry will be, focus on timely execution of projects through improved governance and easy availability
of finance. Awareness and emphasis on qualitative approach will lead to focus on high quality and technology driven equipment. Growing urbanization and Increasing affordability is expected to further spur up the demand for construction equipment in near future. Based on the recent projections, the ECE (Earthmoving & Construction Equipment) market is expected to grow by around 10 to 12 percent over the next few years.
After a subdued phase of last 4 to 5 years, owing to policy paralysis and
global recession, recently Construction Equipment Industry has started
showing a sign of recovery, at a back drop of increased highway
construction, improved government spending on water revitalization &
building new cities. A number of domestic players, who have expanded
their capabilities or diversified their product portfolios, through
collaboration & tie-up arrangements, have now started take advantage
of these signs of improvement in economic scenario.
Interlinking of rivers has started showing growth results for primary construction equipment (earth-moving) which will further continue for secondary equipment (material handling) on the mid and long term basis. An improved version of AL-120, a mid-sized Compact Wheel Loader with 2.3T
pay load capacity, has been introduced with superior features, which will help it, carve its product positioning among similar equipment presently used by builders & contractors.
A higher capacity Loader AL-520, with pay load of 3.5T has also been introduced in the
market place against heavy competition from national & global players, considering
the higher demand from this segment. Continuous focus on improvement in current distribution network has helped spread this product in certain pockets of the nation, which will be further
improved upon in the days to come.
Skid Steer Loader, a highly versatile machine having a growth potential & primarily used in
Industry material handling as well as infra projects, is also on the
anvil of launch pad.
Additional product lines in Construction Equipment Segment, as proposed by reputed market survey agency, will also help your company realize its growth objectives in years to follow.
Further on, your company is also exploring export potential of construction equipment in market of South East Asia & Africa.
With the all-round revival of coal companies and introduction of state-of-the-art technologies products for mining sector, your Company is expected to do better in the coming years.
The main risk and concern of the company remains that it will continue to depend more on Government clients for some more time.
From the balance-sheet (consolidated)
Current financial Investments 22->55->69 cr over last 3 years.
Receivables 88-> 51 -> 48 cr over last 3 years
Non current financial investments 60.28->70.98->76.79 cr over last 3 years
Valuation Analysis
Mcap = 344 cr
Fin Investments + Cash = 148 cr
EV = 196 cr
PAT = 25 cr
4 Likes
Cash = 150 Cr
Mkt cap = 128 Cr
Dividend Payout is 15% on an average which is less considering cash.
Dividend yield is 3% due to low valuation right now.
With Operating Profit of 15 Cr and a history of decent performance, looks like mkt cap of 250 cr can be justified. Anyone following the stock ?
Recently I have started study on the company. Appointment of Mr. Vishal Begwani seems to be the move in right direction. Dependence on Coal India is a challenge, how company can mitigate the risk. Diversification is the way out and company has plans for the same.
Seek any other information if available with fellow investors
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