Equity Watch

Pitti Laminations a blue chip in the making

Pitti Lamination PLL is a 21 years young company catering to the Capital Goods Sector.Its ISO 9002 certified and manufactures high grade Electrical Steel Laminations which form a critical part in all types of electrical motors,alternators,pumps and DG sets.Its also into die-cast rotors,assembled rotors,built-up rotors, small laminations for compressors, jigs and fixtures.It supplies its products to ” who and who ” of electrical industry like,Alstom, ABB, Best and Crompton, Barat Bijlee, BHEL, Crompton, Kirloskar, KSB Pumps, Otis,Toyo Power ,Welco Technologies, GE Electric etc.Its exports to US and Japan constitute almost 25 % of its Rs. 150 crores turnover.

PLL is located close to Hyderabad and has 2 plants with capacity of 10,000 tonnes. Capacity is being doubled and on 28th Jan 2008 PLL has commissioned its 1st stage of forward integration project.

On Financial front PLL’s top-line is growing at more than 30% YOY with corresponding increase in the bottom line.

Scrip Code : 513519    Company Name : Pitti Laminations Ltd

Type Audited Audited Audited Audited
Date Begin 01 Apr 06 01 Apr 05 01 Apr 04 01 Apr 03
Date End 31 Mar 07 31 Mar 06 31 Mar 05 31 Mar 04
Description Value(Rs. million)
Net Sales 1475.84 845.38 450.72 377.89
Other Income 1.14 1.12 5.77 1.72
Total Income 1476.97 846.5 456.49 379.61
Expenditure -1274.53 -708.33 -365.38 -324.75
Operating Profit 202.44 138.17 91.11 54.86
Interest -45.92 -19.18 -7.58 -8.94
Gross Profit 156.52 118.99 83.53 45.92
Depreciation -22.86 -11.8 -7.8 -7.98
Profit before Tax 133.66 107.19 75.73 37.93
Tax -32.14 -38.24 -25.47 2.38
Profit after Tax 101.52 68.95 50.25 40.31
Net Profit 101.52 68.95 50.25 40.31
Equity Capital 92.05 78.34 62.44 62.42
Reserves 397.24 192.9 47.72 8.08
EPS 11.35 8.79 8.05 8.72
Nos. of Shares – Non Promoters 5582110 4682410 3888310 3016110
Percent of Shares – Non Promoters 61 57 62 48
Result Type A

Results reproduced from BSEINDIA

The latest Q3 results of FY08  are very encouraging with top line growing by more than 30% over Q2 FY08 with more than 50% increase in PAT over Q2FY08.

PLL has an equity capital of Rs. 9.2 crores.Expected top line for FY08 is Rs.150 crores and Rs.250 Crores for FY 09.Based on Q3 results expected EBIDTA for FY 08 is Rs. 20 crores and an EPS of Rs.12 per share. Market capitalisation of PLL at CMP of Rs. 60 is less than Rs. 60 crores, and share is available at P/E of  5, which appears to be highly under-priced for this high technology R & D driven company, catering to the most important segment of the Industry. With Mkt. Cap. / EBIDTA ratio of less than 3 for FY09 and PEG of less than 0.2, the share is a screaming BUY at CMP.

Buy is recommended at CMP of Rs. 60 with 2 years HOLD.

This report has been prepared solely for information purposes and the information contained herein may not be deemed to be an investment advice. Such information is impersonal and not tailored to the investment needs of any specific person. The information contained herein is not a complete analysis of every material fact representing any company, industry or security. The views expressed may change. While the information contained herein has been obtained from sources believed to be reliable, no responsibility (or liability) is accepted for the accuracy of its contents. Investors are advised to satisfy themselves before making any investments and should consult with and rely upon their own advisors whether and how to use such information in making any investment decision. Neither the author nor his firm accepts any liability arising out of use of the above information

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2 thoughts on “Pitti Laminations a blue chip in the making

  1. makarand kokane says:

    The amount of equity dilution seems to be huge year after year. Has diluted more than 50% in 3 years. Do you think this could be a concern? Can we find any details about the credibility of the management?

    Like

  2. Isha Sharma says:

    Hi Ashok Sir,
    Just wondering what is your recommendation on Vinati Organics? This company seems to be headed for good growth in the next 2 years or so. My friends have bought it in big numbers. I am not able to make up my mind. Pl. guid me.

    Like

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