Facor Steel,a company in its infancy being just 4 year old is already beginning to look like a Stainless Steel (SS ) major.Facor Steel is speciality steel long products manufacturer having one of the most modren State of the Art plant .SS Long products cater to automobile, Railways,defence and Engg sectors. Its products include SS, Alloy steel,Valve steel, Carbon manganese steel,Silico manganese steel etc.Products are exported to European countries ,USA and Middle East.
Presently the company has capacities of 60,000 MTPA of quality alloy steel and SS with 2 rolling mills having capacity of 80,000 MTPA.Company has decided to expand its SS capacity by 500,000 MT,and also set up a 250 MW coal based power plant costing Rs. 2500 crores
Company’s financials are showing a marked improvement YOY with top line growth in excess of 25% .
Financials reproduced from bseindia
With equity capital of Rs. 20.6 crores divided into 20.6 crore shares of Re.1 FV, market capitalisation of the company is just about Rs. 93 crores at CMP of Rs. 4.5 .With 9 fold expansion in SS capacities and 250 MW coal based power plant ,an exponential growth is expected in the next 3 years. Even for FY08 Company is expected to have a turnover of Rs 500 crores+ with PAT of Rs. 8+ crores and EPS of 0.4 .Thus the share appears to be good long term value buy.
Buy is recommended at CMP of Rs. 4.5 for 3 years HOLD
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