Marson Ltd ISO-9001-2000 certified,52 year young company in power infrastructure sector having state of the art manufacturing and testing facilities for almost all kinds of transformers ranging from 25KVA to 100 MVA is our recommendation for year 2009.The stock was earlier recommended in 2007.
The Company has so far supplied more than 100,000 transformers to companies like Siemens, NTPC, State Electricity Boards,CESC, Hydel Power plants, GRIDCO, Ordinance factories etc.
Company’s equity capital is increased from Rs.10.8 crores with 5.4 crore shares of Rs.2 FV to Rs. 17.1 crores with 8.55 crore shares, as the company has merged Marson Transformers Ltd.( a Group Co.) with Marson Ltd. and allotted 3.15 crore shares to the promoters of Marson Transformers ltd.This has increased promoters stake in the Co. to 46.8% from just 16% a year back.
Market capitalisation is just about Rs. 20 crores. Company has its manufacturing units in almost 4 lakh sq ft area in proximity to port and is the largest manufacturer in Eastern region. It also has its own Transformer Oil Plant , Copper wire and Strip plant. Replacement cost of such a strategically located plant will not be less than Rs. 100 crores.With unsecured loans of about Rs. 10 crores the share at CMP of Rs. 2 appears to be undervalued, and can prove to be a multibagger.
Buy at CMP is recommended with atleast one year HOLD
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