Visited Big Bazaar / Star / Central Mall- Surat in recent days - Kitchen section full of Prestige wares …1 / 2 pieces of Hawkins Cooker / Miss Mary…feed back from other places please.
Received the Hawkins AR for fy 13 today…
Its short and easy on the eyes.
They have described the problems they faced in fy 12 namely the pollution issue at hoshiarpur facility and labor problems at jaunpur facility… Pollution issue is resolved whereas about the labor trouble they mention that they have made court approved legal agreements with 85% of the workers…
Production from the hoshiarpur facility was up 24% in jan to may 13 period as compared to previous jan to may 12 period.
Exports was up to 23 crores, 57% higher than previous year.
Company has given a photograph of 3 litre hawkins induction pressure cooker and it is priced at Rs 2300 per piece. Benefits of this is it has a thick base, cooks evenly and fast… base of cooker stays flat and will not seperate (this supposedly has been the sore point with other induction based cooker esp the ttk prestige product) and works on induction, gas, electric, ceramic and halogen.
During fy 13, company launched nine new products which sold 3.2 lac units (as against 1.4 lac units of newly launched products during fy 12).
Company has taken 7% price increase in products from 1 april 2013. (Impact on margins in first quarter needs to be seen)
drop in aluminium prices in dollar terms has been compensated by fall in rupee. So no benefit here.
Overall I think there remains a case for improvement in margins in fy 14 due to price hike, better operating leverage since the company is operating at full steam and free from previous year’s problems.
Personally I remain bullish on the company and its prospects going forward.
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Thanks for incisive short & crisp analysis of the AR of Hawkins Hitesh,
Looking forward to similar analysis for other AR also .
As per the Annual Report
"Hoshiarpur factoryâs production in the period January to May, 2013, is 24% more than the corresponding five months in the previous year. "
As per the AGM speech of 2012
"Had we similarly produced 27% more pressure cookers in the Hoshiarpur Factory in the June quarter 2012 than what was produced by the factory in June quarter 2011, and the factory is quite capable of doing so as its stands today, the Company would have had an extra 154,000 pressure cookers to sell in June quarter 2012. Our pending orders as of the end of June quarter 2012 were 148,000 pressure cookers. With the said extra production from Hoshiarpur Factory, we would have been able to reduce the pressure cooker pending orders to about 10,000 units and increase the sales in June quarter 2012 by 138,000 units. This sales increase would have given us an extra revenue of about 18 crores and an estimated extra net profit of about 3 crores. "
Now as per AR the production is up by 24% for Jan-May 2013.
So production from Hoshiarpur should be around 3.16 lakh units for Jun qtr. i.e revenue of about 41 cr. from Hoshiarpur. (Avg price per unit = 18 cr/1,38,000 = Rs. 1300)
In Jun 2012 revenue from Thane + Juanpur was around 38 cr. The production has increased by about 35% as per AR. So 51 cr from these two factories in Jun 2013. So Cooker sales will be around 92 cr. 15% are cookware sales. So Total sales might be around 110 cr. I am assuming that the company can sell what it is producing. So ideally the sales should be above 100 cr. Is this analysis right or am I painting a rosy picture ??
bhai kuch kaam aap khud bhi kiya karo…
@rohit kotiwale,
last yr june qtr sales was 81 cr with net profits at 5.24 cr.
100 cr sales would provide a figure of 25% growth in sales esp during the june qtr which usually is a lacklustre quarter for hawkins.
about calculations, it all depends upon the inventory it had prior to the june qtr.
Plus they took a price hike of 7% which should aid margins.
If above guess + operating leverage, should be see abnormal(one time) rise in PAT?
Hitesh ji, last yr Jun qtr had 81 cr sales only due to the supply constraint. Their sales would have been 100 cr had these supply constraints not existed (As per AGM speech). So the growth I am assuming is actually only 10%.
@rohit kotewale,
As compared to last year’s first quarter which was a howler, this year should be comparatively much better.
@Rohit excellent!!! If we add 7% to the 1300(which the company has taken price increase) comes to 1391, provided the raw material cost remaining the same (low aluminium price compensated by rupee fall). If everything goes well, we are seeing a revenue between 100- 110 crores.
Let’s hope they don’t face any demand issue now, earlier it was supply issue.
From AR it seems that their cookware sales have increased at just 10%; while cookers grew at 19%. This comes as a surprising development esp. as cookware grew by over 30% in previous financial year and the management was confident of maintaining the momentum in FY 13. I thought cookware was outsourced and so it should not have faced supply issues. Any guess on the reasons? demand slowdown or increased competition etc.
On the charts the stock seems to be doing the right things…
It took support around the 200 dema at around 2115, went down a couple of times below it to shake off the weaker hands and now appears headed upwards.
There seems to be stiff resistance in the 2190-2225 band which needs to be negotiated.
Lets see how things pan out.
I think the stock movement till the results should tell us something important… If it goes above the resistance band and manages to stay there things could get really interesting. Otherwise we might see extremely range bound movements we have seen till now continuing.
Though it did go below 200dsma It continues to trade above 200 day exponential ma. Even in jun12 and aug12, it did not go below 200dema.
**If u are following technicals then look at another observation I have made. Whenever there is a crossover of 200 dema and 200 sma whichever goes on top of the other, there is volatility in stock price. **
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What makes you say- “production from Hoshiarpur should be around 3.16 lakh units for Jun qtr”
Also production in Jaunpur in 2012-13 is 35% higher. No idea for June quarter. What makes you assume 35% in June quarter also??
factoryâs
As per AGM speech Jun 2012 qtr production was 2.55 Lakh units. As per AR the production for Jan-May 2013 for Hoshiarpur is up by 24% as compared to Jan-May 2012.
So production from Hoshairpur in Jun 2012 = 2.55 * 1.24 = 3.16 Lakh units
For Jaunpur I am assuming that as it is free of any production issues as of now the 35% growth of 2012-13 should be reflected in Jun qtr as well.
What makes you say- “production from Hoshiarpur should be around 3.16 lakh units for Jun qtr”
Also production in Jaunpur in 2012-13 is 35% higher. No idea for June quarter. What makes you assume 35% in June quarter also??
"Hoshiarpur factoryâs
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Thanks for incisive short & crisp analysis of the AR of Hawkins Hitesh,
Looking forward to similar analysis for other AR also .
bhai karo…
This sort of personal arrogant full of superiority complex comment is least expected from a senior n venerable member like Hitesh Patel.
Your image has been lowered in eyes of not only me but several other valuepickers who too have been shocked by the tone of your sentence.No other member like Donald or any other senior Valuepickers have used this sort of insulting tone n language ever on this forum.the forum is going to lose its popularity if this sort of insulting language is to be used.
FYI I have been contributing in my own way on this forum for a fairly long time .I too have been active in the stock market since 1992 am at your age n still hurt by the tone of your reply.
Last year I earned a return of 1 Cr with good % age return on my portfolio so I would be having some knowledge n experience of my own as well.
One has to be right only 55% of the time to generate good returns. One should Remember ones star recommendation as well as wealth destroyers recommendation as well.
You had earlier used this mocking supelicious tone earlier also during Can fin reco but I had swallowed the insult n kept quiet. Canfin was your reco I was only trying to help by speaking to insiders n producing verbatim the feedback.
Hawkins AR was self explanatory n all I did was to complement you for your good work.
Please calmly think over your words and reflect whether they are in right spirit. I will never ever interact with you if that’s what you wish.
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kuch kaam aap khud bhi kiya
Take a chill pill Vivek Gautam. As I read Hitesh’s comment, it is meant to be in a lighter tone and I do not think the sentence has any “insulting, arrogance, superiority complex, derogarory” tone to it. You have over reacted to the situation in a big way. May be you had a bad day and wanted to vent it? But, this is not the correct way. You need to coolly think, NOT Hitesh. And in the pretext of accusing Hitesh, you have sufficiently boasted yourself mentioning your huge net worth returns etc. As I understand from past Hitesh’s contribution to this forum, many others have been immensely benefited from his knowledge. Though I have recently joined the forum, I have been tracking this from a sufficiently long time. Apologies, if my comments hurts any sentiments of any members, I just opined what I think from a neutral point of view.
vivek,
As biju john mentions correctly, TAKE A CHILL PILL…
the tone was meant to be a joke and hence in hindi also.
And congratulations by the way for the “1 CRORE” returns on your portfolio… Hope you keep up the great performance with your incisive knowledge of investing.
regards
hitesh.
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Vivek,
Please Cool down. I know Hitesh personally and he is not a sort of person who will try to humiliate anybody or try to show someone inferior. You also know him well. Also many senior fellows has the highest regards for Hitesh for his sincerity and humility. So your outburst is needless and look childish. Also you should have avoided your One Crore comment. I know there are many valuepickr members who earn in multiple of your last year’s returns. Let the peace prevail.