Laxmi Cotspin Limited ..... Undervalued SME

Today I am expressing my view on the textile sector player in SME segment ...... LAXMI COTSPIN LTD

Fundamentals

• NSE SME listed
• Lot Size - 6000 Shares
• Current Price - 16.70/-
• Issue Price - 20/-
• EPS - 1.56/-
• PE - 11
• BOOK VALUE - 25/-
• Revenue - 115 Cr.
• Net Profit - 2.68 Cr.
• DIVIDEND - 0.50/-

Product and Capacity

• Ginning (Cotton Bales) + Spinning ( Yarn )
• Company is done it's expansion in June 2017 and After expansion it's revenue will increase to 140cr as per announced by company in NSE Emerge Notice.
• Company has capacity of 16,800 spindles and 1200 open end rotors.
• Factory is Located in the cotton growing areas of Marathwada & Vidarbha region

Vision

• 25000 Spindles Expansion in 2017-18
• TFO - 08 Machine to be installed in 2017-18
• 06 Knitting machine to be installed in 2017-18

Land & Building

• Total land of LCL is 48 acre.Approx 12.34 acre in which spinning plant is working.
• Approx 8.00 acres in which Ginning plant is working.
• Open land approx 28.00 acre.
• Admin Building (double storage) of approx size of 5200 feet
• Cotton godown of size 18 *55 m say approx 11000 feet & central store of size
• 6000 feet (same building underground)
• Two cotton godown size approx. 17,000 sq feet each

Disc: holding the stock

NOTE : THE ABOVE IS NOT A RESEARCH REPORT NOR A RECOMMENDATION  BUT INFORMATION AS AVAILABLE ON PUBLIC DOMAIN.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Performance and Update

Dear Readers,

Let's have a look on the performance of the stocks discussed in the blog till date.

Your comments and suggestions are welcome. Next script will be posted very soon.

JHS Update

JHS has come out with robust FY17 Q4 numbers and has revealed aggressive expansion plan.

JHS inching towards the GLORY JHS has become PAT positive after 6 years. The Company has been through its share of cyclical business upheavals to emerge stronger. JHS has recovered well after its product portfolio growth with top Indian FMCG brand / company in last 2 years. The company has reported total revenues of Rs.105.48 Cr. up by 5.39%. EBIDTA is up 68% at Rs.12.04 Cr. and the PAT at Rs.21.98 Cr. JHS is also engaged further in aggressive capacity creation and is investing heavily in the capital equipment(s), almost to the tune of Rs.30 Cr. towards setting up additional manufacturing unit and equipment balancing at our first unit, with the objective of creating a future-ready company by July'2017. The overall capacity in toothbrushes to increase from 150 million toothbrushes (March 31, 2017) to 250 million toothbrushes (March 31, 2018). For Toothpaste from 90 million toothpaste tubes (March 31, 2017 ) to 175 million toothpaste (July 30, 2017), and from only 3 size tubes to 7 size tubes 18/30/50/80/100/150/200 gms. The aggressive CAPEX is backed by visibility of business from some of our larger clients including Patanjali and Dabur. Alongwith, JHS own brand, AquaWhite, is scaling distribution and we intend to significantly strengthen the brand franchisee and product positioning in coming months. Interestingly the Company shall continue to debt-free coupled with strategic equity investors who understands the business and have provided a significant part of the Company's precious growth capital with long term goals in mind. 

Following are the links of JHS official submission to stock exchange and Q4 results

1. JHS FY17 Q4 Results

2. JHS Update

Maheshwari Logistics Ltd ..... SME potentially multibagger

Today I am expressing my view on one of the excellent logistic, coal as well as paper sector player listed in NSE SME platform ..... Maheshwari Logistics Limited.

The Company

Incorporated in 2006, Maheshwari Logistics Limited is engaged in providing logistics services, supplying of non-coking coal, manufacturing of kraft paper and trading in a variety of papers. It has its registered office and paper manufacturing facility situated at Gujarat. Further it has 6 branch offices which are situated at Gujarat and Rajasthan.

Set up by Maheshwari and Kabra Group, the Company offers a diversified business model, covering three different sectors ranging from logistics services to fuel to paper. The experience and trade relations developed by its promoters and management have been one of the key instrumental factors in the growth of the Company. With the vision and dedication of its management it has been able to accomplish a revenue growth of more than 80% in past 5 years and achieve a turnover of more than Rs. 600 crores during financial year 2015-16.

Logistic Business

The Company started out with logistics services and over the years has developed a strong clientele network in the sector. It primarily offers full truck load freight services to large and medium size companies mainly across the state of Gujarat and Rajasthan. It has also extended its logistics arm in state of Maharashtra and Madhya Pradesh. It uses its own trucks as well as hires third party transportation services for carrying out its logistics operations.
It has a fleet of more than 60 trucks and an association with more than 1,000 trucks though third parties. It has also set up a full maintenance workshop for all its vehicles at Nimbahera and Jamnagar. Maheshwari's goods transportation services serves a broad range of industries, with its customer belonging to cement, paper, textiles, fertilisers, etc. industries. For the year ended March 31, 2016, its logistics services contributed 36.62% to our total revenue from operations.

Coal Business

Along with logistics services, the Company ventured into trading of non-coking coal. It procures coal either through direct imports or through high seas purchases from other importers. It has also installed a screening plant at Vapi for sizing imported as well as indigenous coal for its customers who have specific requirement of sized coal. For the year ended March 31, 2016, its revenue from coal trading contributed to 51.43% of its total revenue from operations.

Paper Business

Maheshwaris paper journey began with trading of variety of papers. With gaining an insight of the industry coupled with an available opportunity, the Company ventured into manufacturing of Kraft Paper in 2015 by purchasing business vide a business transfer agreement dated September 30, 2015 from M/s. Daman Ganga Recycled Resources LLP. It further entered into a tripartite job work cum plant and equipment operating agreement with Daman Ganga Papers Limited and Daman Ganga Recycled Resources LLP for a period of 20 years. This manufacturing facility is spread over an area of 45,000 square metres and is equipped with the necessary plant & equipments. At present, it has a manufacturing capacity of 750 lakhs kg p.a. Within a short span of time, the Company has been able to create a demand for its manufactured products. From October 2015 to March 2016, the Company generated a turnover of Rs. 4,600.87 lakhs sale of manufactured products. It endeavours to satisfy customer by continuous improvement through process innovation and quality maintenance. It aims to grow its operations on PAN India basis and make its brand as a distinguished name in industry.

Outlook

Promoters hold 58.19% stake of company. For the first half of FY17 top lines and bottom line reported by company is 334.81 cr and 4.71 cr respectively compare to last full year 605.47 cr and 6.92 cr.

Out of the 41.81% of publicly held stake more than 35% of the stake is in locked in period. P/E of stock is around 13.  Stock is available at Rs. 90 and listed only in NSE.

Disc: holding few quantity of stock

NOTE : THE ABOVE IS NOT A RESEARCH REPORT NOR A RECOMMENDATION  BUT INFORMATION AS AVAILABLE ON PUBLIC DOMAIN.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Rapicut Carbides Ltd ..... niche player in Non Ferrous metal sector

Today I am expressing my view in one of the micro cap company from Non Ferrous metal sector ..... Rapicut Carbides Ltd.

Company

Rapicut Carbides Limited (RCL) was incorporated as a Public Limited Company, in April 1977, and an integrated unit was set up at Ankleshwar, Gujarat for manufacturing of Tungsten Carbide Tips, Inserts and other Carbide products from ore stage. Commercial Production Commenced in October 1979.
RCL today manufactures a wide range of Tungsten Carbide (T.C.) Products viz., Tungsten Carbide Tips, Tungsten Carbide Inserts, Wire Drawing Nibs, Bar and Tube drawing Pellets, Tungsten Carbide Rings, Flats, Bushes, Jute Eyelets, Solid Carbide Cutters and a wide range of Tool Room Products.

Research and Development

Manufacturing quality products means setting standards. To adhere to these standards, all the processes have to be under the purview of trained eyes. To Constantly upgrade the efficiency and quality of its products, RCL taps the potential of its in-house Research & Development facility. RCL's Centralized Research & Development department is equipped with advanced data processing equipment to facilitate material composition analysis and various other tests.
   

Quality Control
 

It is to be noted that the most important factor in obtaining quality Tips and Inserts is controlling the physical and chemical properties at every stage of operation. The chemical lab has facilities to analyze the impurity levels present in Tungsten Tri Oxide, Tungsten Metal and Tungsten Carbide. The physical laboratory has facilities to check the micro-structure, hardness, specific gravity, coercive force, transverse rupture strength, porosity etc., of the sintered products, The rigid quality control at RCL has enabled it to meet the exact requirements of Engineering Industry. RCL is an ISO 9001 : 2000 Certified Company (by RWTUV)

   

Products

Rapicut has wide range of products such as MINING , WEAR PARTS, METAL CUTTING, POWDER, as well FINISHED PRODUCT.

Clients

Some of Prominent Clients or RCL are….

PRP Granites, Lupin Limited, Hind Associates, B.R.Machine Tools, P.S.K.S & Company, Bundy India Limited, Forbes Gokak Limited, Greaves Cotton Limited, Godrej Industries Limited, Tata Steel, Electro Steel Castings Limited, SAIL, BHEL, Neyveli Lignite Corporation Limited, Hindustan Platinum Private Limited, Birla NGK Insulators Private Limited, Mineral Exploration Corporation Limited, Sanghavi Shoe Accessories Pvt. Limited, Jamshedpur Engg. & Machine Mfg. Company, Weatherford Drilling & Production Services (India) Pvt. Limited.

Outlook

Promoter hold 35.26% stake of company. Company is steady dividend payer and Bonus in ratio of 3:2 has been declared in 2013. Last nine months top lines and bottom line reported by company is 31.53 cr and 2.2 cr respectively compare to last full year 33.45 cr and 1.45 cr.

Company is available at just 43.43 cr market cap and compare to peers negative or neglible operating margin it has OPM of 14.04%.  Stock is available at Rs. 80.85 and listed only in BSE.

Disc: holding few quantity of stock

NOTE : THE ABOVE IS NOT A RESEARCH REPORT NOR A RECOMMENDATION  BUT INFORMATION AS AVAILABLE ON PUBLIC DOMAIN.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”