Indian Hume Pipe Company - Water Company with Strong Order Book

Stock Opportunities
1

Market Cap - 440 Crores

Order Book - 2600 Odd Crores

FY 14 Profit - 24 Crores

CMP - 182

The company is acknowledged as a pioneer in the industry of RCCC Pipes, Water Supply Schemes, Pipe Laying etc

Details : http://www.indianhumepipe.com/AboutUs/WhyIHP.aspx

Business :On a turnkey basis, IHP executes combined water-supply projects, i.e., undertaking the complete job of water supply from source to distribution centers. This includes construction of intake wells, water sumps, water treatment plants, water pumping stations, installation of pumping machineries, for water supply to various towns and villages of India.

**Latest Results : **

http://www.bseindia.com/xml-data/corpfiling/AttachLive/Indian_Hume_Pipe_Company_Ltd_270514_Rst.pdf

Ofcourse, NAMO’s focus may lead to a further improvement in Order Book

The stock can be considered as a beneficiary for new Water Supply Schemes of Govt. Worth a look.

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Request others to join and debate on this story.

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Hi Ashwini,

i wasn’t able to find out the annual capacity of this business in the latest AR. Their annual sales are in range of 800 cr. So, what are they upto while taking 3 times of that as order book ?

Return ratio’s aren’t also anything exciting. Plus if you look at the risk & outlook section in 2013 AR, they highlight all the classic problems of a commodity kind of industry. Risk of price increase in raw material (inability to pass cost), risk from alternatives like HDPE,PVC etc, and then of course dealing with govt or govt. agencies basically.

It doesn’t look cheap either with loads of debt.

Any other reason, apart from NaMo, for being interested in this stock ?

3

Agree with you Raja. The company no doubt has huge asset base so for me it will remain as an undervaluation play rather than compounding/increasing ROIC.

Personally, i am very poor at undervaluation plays :frowning: either dont understand enough or dont allocate enough.

On side note this is the potential market for Astral to enter into :slight_smile:

cheers,

PS- Not invested.