Equity Watch

XL Telecom and Energy Ltd.-time to buy a potential Blue Chip is when the chips are down

XL Telecom and Energy Ltd. was incorporated at Hyderabad as a Private Ltd. Co. in 1985 and became a Public Ltd. Co. in 1990.The company is partnered by Corning Inc. and Kyocera Inc. of USA.The company caters to the Telecom Sector,and Energy Sector specific to Solar Energy and Bio Fuel Ethanol..

In the Telecom sector, Co. caters to CDMA Mobile telephones, Fixed Wireless Phones and Terminlas,Switch mode Power Supply SMPS for powering Telecom Networks,and Cable Jointing Kits.

In the Solar Power sector, the Co. is pioneer with the distinction of being the first Global Power Co. to capture the complete Solar Value Chain from Solar Cell to Energy Generation.XL has made inroads into many countries of Europe. XL Telecom is installing state of the art Crystalline Cell Manufacturing Facility with leading Technology support from Germany. The present installed capacity of the cell plant is 120MW per annum.Also XL Telecom is installing 40MW new line of module manufacturing facility with Technology support from Germany. With this additional facility the total module production capacity will be 232MW per annum. This new facilities of Cell Line & Module Line will be operational by the end of Q3 of 2009 at Special Economic Zone (Fab City), Hyderabad in India.

On the Financial front the Co. was doing very well untill the global slowdown affected the operations during the last one year.

Scrip Code : 532788      Company : XL Telecom & Energy Ltd
Type Audited Audited
Period Ending 30-Jun-08 30-Jun-07
No. of Months 12 12
Description Amount(Rs. million)
Net Sales / Interest Earned / Operating Income 6,540.15 5,231.43
Other Income 25.15 14.20
Total Income 6,565.30 5,245.63
Expenditure -5,819.02 -4,833.97
Operating Profit 746.28 411.66
Interest -259.58 -139.38
Profit Before Depreciation and Tax 486.70 272.28
Depreciation -21.34 -16.20
Profit before Tax 465.36 256.08
Tax -63.93 -54.31
Net Profit 401.43 201.77
Equity Capital 187.85 145.01
Reserves 2,702.48 1,387.53
Basic And Diluted EPS after Extraordinary item 13.91
Basic EPS after Extraordinary items 21.37
Diluted EPS after Extraordinary items 17.63
Nos. of Shares – Public 13,502,140.00 9,899,544.00
Percent of Shares-Public 71.88 68.27
Operating Profit Margin 11.41 7.87
Net Profit Margin 6.14 3.86
Cash EPS 22.51
  Notes Notes
  Detailed

results reproduced from bseindia 

During the last quarter ended June 30, 2009, the company has provided Rs 204.94 Crores toward Mark to Market MTM (losses) of inventories on hand in view of sluggish demand in Europe.This has resulted in a loss of Rs. 237 crores for the quarter.However with the revival of economies of Europe and USA, it is expected that the Co. shall do very well in Future.During 2010, Its performance may far exceed the 2007/2008 as shown above.

The time to pick up a Future Blue Chip,(market Price during 2007/2008 was above Rs. 500), is NOW.

Buying at CMP of Rs.34 is recommended for an year’s 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

Standard

5 thoughts on “XL Telecom and Energy Ltd.-time to buy a potential Blue Chip is when the chips are down

  1. NSri says:

    Dear Sir,

    Promoter’s holding on this has gone down in 2008 from 28% to 10%. Looks like knowing the company’s health they have sold out their stake. Is it not negative about the stock?

    NSri
    Pune

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  2. Thanks Nsri for bringing this to my notice. However what BSEINDIA site shows is 25 % share holding by promoters and 32% by FI/FII’s. Latest is that Morgan Stanley has converted FCCB’s @ Rs. 150 per share.
    XL Telecom – Outcome of Committee Meeting
    Announcement: XL Telecom & Energy Ltd has informed BSE that a Committee of the Board of Directors at its meeting held on September 15, 2009, inter alia, have allotted 11,19,093 (Eleven lacs Nineteen Thousand Ninety Three only) Equity Shares of Rs 10/- each of the Company at a premium of Rs 150/- per share to “Morgan Stanley Mauritius Company Ltd” upon conversion of Foreign Currency Convertible Bonds to the extent of US$ 4.50 million.

    Consequently, the paid up Equity Share Capital of the Company has been increased from 19655857 Equity Shares of Rs 10/- each to 20774950 Equity Shares of Rs 10/- each.

    Thanks and as promised I shall check it up with the Co. Secretary..

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  3. NSri says:

    Thank you Sir for your reply !! Company’s share price is sinking on lower circuits these days.. Don’t know If it would be good to be braveheart and buy.. because Rs28 per share for XL Tele is a mouthwatering price against its all time highs of 500+. What do you suggest ?

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  4. elegant_boy says:

    Hi

    6/11/2009 532788 XL TEL ENE MORGAN STANLEY MAURITIUS COMPANY LIMITED S 180000 28.38

    why Morgan has started selling its share which it just bought month back ?

    something fishy ?

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  5. I find it as one of the cheapest stocks in Solar Energy segment.However you can wait and see if it forms a new low from its previous low of Rs. 26.That could be a support price..However if it starts to jump from present level of Rs. 28, then you may consider to re-enter at Rs. 34 or so.

    Best of luck..

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