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A TIME COMMUNICATIONS PUBLICATION VOL. XX No. 36 Monday, July 18 24, 2011 Pages 19 Rs.12
GURU SPEAK
Market trend yet to emerge

The trading pattern in the stock market last week was no different than what it was in the week earlier. The benchmark indices extended their losing streak further on the first two days with the BSE Sensex falling by 136.65 points on Monday, 11 July 2011 followed by another fall of 309.77 points on Tuesday, 12 July 2011. Along with the fall of 220.76 points on Friday, 8 July 2011, the toll was 666.68 points for three consecutive days of trading from its high of Sensex 19131.70 attained week before last. This clearly signals that the market does not have a definite trend as it fluctuates on either side based on the speculative position among market participants depending on the following news & events: G. S. Roongta (1) The market was agog with a spate of negative news, particularly about the credit crisis brewing in the Euro zone countries with Italy, which had a larger debt than Greece, Portugal, Spain & Ireland put together, also likely to turn a defaulter. This news sparked on the evening of Monday, 11 July 2011 after the closure of Asian markets and created a panic when they reopened on Tuesday, 12 July 2011. The Hang Seng opened in the red lower by 600 points followed by the European indices like the FTSE 100, DAX and CAC all losing considerable grounds. (2) Lower industrial production data (IIP) and wholesale price index (WPI) as well as the food inflation data released last week did not enthuse the market. The industrial growth has moderated to 5.6% in May 2011 as against 8.6% in May 2010 with capital goods, power and electricity generation denting the growth. Manufacturing, however, exhibited neither buoyancy nor decline and therefore saved the day from any further decline in stock prices. (3) The much awaited Q1FY12 results of Infosys too fell short of market expectations on weak future guidelines by the company management. This resulted in the stock declining from its previous closing of Rs.2921 to as low as Rs.2725 during the week. (4) The big talk of a reshuffle in the Union Cabinet is reported to have ended as a scuffle with 4 cream posts like Home, Finance, Defence and External Affairs ministries retained by the big 4: P. Chidambaram, Pranab Mukherjee, A.K. Antony and S.M. Krishna. The 8 new faces inducted could not shake off the impression that it was all a game of musical chairs with the entry of the junior Deora to keep hold of the family legacy. Thus, the much talk about the cabinet reshuffle proved to be lacklustre from the stock market point of view. (5) The slowdown in automobiles with pressure on margins felt almost by all major manufacturers such a Maruti Suzuki, Mahindra & Mahindra, Tata Motors and Bajaj Auto was seen as a cause of concern in as much as the automobiles sector was the star performer in 2010-11. Such issue based news impacted the market sentiment on Tuesday, 12 July 2011 while the market witnessed value buying as several stocks from the A group category bounced back on Wednesday, 13 July 2011. The stocks that gained the most were Bharti Airtel, Bajaj Auto, L&T, which finished at Rs.1800, Sesa Goa, Tata Motors and ONGC. The mid caps, however, remain sluggish. The serial bomb blasts at three different places in Mumbai in the evening on Wednesday, 13 July 2011, weakened the market sentiments further the next day. Both the benchmarks opened in the red on Thursday, 14 July 2011 and the Sensex
A Time Communications Publication 1
lost almost 200 points by mid-day but regained all the lost ground only to attract profit-booking and surrender the gains in full. Accordingly, the Sensex closed the day in positive territory with a gain of 22.18 points to close at 18618.20. Correspondingly, the CNX Nifty gained 14.35 points to close at 5599.80. The market thus witnessed volatile activity in spite of the terrorist blasts the previous day. On Friday, 15 July 2011, the market remained lacklustre as profit booking emerged at higher levels and the Sensex closed at 18561.92 with a loss of 56.28 points while the Nifty closed at 5581.10 with a loss of 18.70 points. Thus the week ended without any clear trend in the stock market. Despite such negative news throughout the week, the trading pattern in the market reveals that it is in no mood to stage any major retreat in the near term and will pause before declining further on any issue based news, whether domestic or global. This is because the market seems to have consolidated in the last 6-8 months having absorbed all the negative factors, market gossip and rumours. Leaving aside the results of Infosys and realty stocks, most companies are expected to perform better and cheer the market sentiment. Bajaj Auto and Bajaj Finserv have proved to be star performers despite the slight dip in margins. Both have reported excellent growth and maintained profitability over 25% with rise in volumes and export. Under mid cap stocks, Shanthi Gears, recommended extensively in our Investment Advisory Service (IAS) and subsequently in Money Times, has posted excellent results for Q1FY12. Net sales have shot up from Rs.32.54 crore in Q1FY11 to Rs.40.22 crore in Q1FY12. Net profit, too, has risen from Rs.5.95 crore to Rs.7.01 crore despite the higher base effect. This clearly establishes our ability to spot fundamentally good stocks irrespective of the market mood and manipulation, which sent this stock to as low as Rs.32 two months back. As stated several times before, fundamentals cannot be suppressed for long and prices of good stocks are bound to bounce back as happened in this case as the stock gained 40% to touch a weekly high of Rs.47. This will happen in most of the stock recommended under the IAS or in Money Times and it is up to subscribers to exercise patience and reap a good harvest. Readers may recall that Money Times was the first to anticipate a boom in textile and spinning units in early 2010-11 and recommended several stocks from this sector and they have all performed well giving superb returns to the subscribers of the IAS and also Money Times. Prominent among them is Arvind Ltd., which is trading as high as Rs.86 while it was recommended at Rs.30 in September 2010. Both Suryalata Spinning and Suryaamba Spinning have skyrocketed from the recommended price and have provided over 200% in just 8-10 months. One dark horse identified was Cheslind Textiles, recommended around Rs.12 in end August 2010, which rose above Rs.22 but fell back to the same level as buyers lost patience. Its growth prospects highlighted in our article have not only been fully achieved but exceeded our targets going by the Annual Report of 2010-11. The turnover has risen by 45% to Rs.109 crore from Rs.76 crore in FY10. PBIDT has zoomed 100% to Rs.32 crore from Rs.16 crore in FY10. PBT has skyrocketed 600% to Rs.11.73 crore from Rs.2.3 crore on FY10. This amply establishes that our selection of fundamentally good stocks is significant and we never hunt stocks for measly gains as we end 100-200% profit over a time frame of 1-3 years. We have repeatedly advised investors not to follow the indices on a day-to-day basis like the traders as it can be totally misleading. Fluctuation on either side on issue based news rarely has any bearing on Investment Advisory Service a companys working on a yearly basis and by G.S. Roongta can mislead investors to miss buying a stock Money Times is pleased to introduce Investment Advisory Service or divest before it is fully ripe. Also (IAS) by our renowned columnist Mr. G. S. Roongta, who has over 25 investors tend to sell out of fear in a falling years of experience and is well-know for his accurate forecasts since market or book small profit early out of 1986. greed and miss out on the real gains. The Interested investors can visit Money Times office between 4 p.m. to 6 most unfortunate part is when they miss to p.m. on Tuesday or Thursday every week after prior appointment board the train when the profitable journey with our office. Outstation readers can consult him by e-mail or begins. phone. Its the job of analysts or market watchers to A minimum one time charge of Rs.1000 has to be paid in advance give a commentary or an opinion on a TV favouring Time Communications (India) Ltd. against which a channel or a newspaper but investors maximum of 5 scrips will be recommended for investment and should not get carried away by the shortreviewed up to a period of three months. term outlook propagated. They should have Other services like portfolios analysis/restructuring will be charged the courage of conviction while investing in extra depending on the size of the portfolio & service. a stock based on its fundamentals and the Contact Money Times on 022-22654805 or rationale featured and have patience for the Telefax: 022-22616970 or email us at moneytimes@vsnl.com. stock to play out.
A Time Communications Publication
At any point of time there will be contradictory opinions depending on the individuals outlook or assessment but they may not turn out to be true. Even now, while an analyst from a foreign brokerage forecast the Sensex to hit 22,000 in a leading pink paper, another analyst and a former CEO of a leading cement company stated that the market will shed 510% from the current levels and the Nifty will touch the 5000 level! Investors are not day traders who must buy/sell on a daily basis and they should remain focused on the company and sector in which they have invested before taking any hasty decision out of fear or greed.
BAZAR.COM
By Fakhri H. Sabuwala The serial bomb blast in Mumbai on Wednesday, 13 July 2011, was once again a test of the Mumbaikar's resilience to any tragedy whatsoever. As usual, the market seemingly opened lower on Thursday, 14 July, drifted lower before recouping all the losses and even gained some 200 points on the Sensex. It has always been so. After such a tragedy, the market has stood firm and exhibited resilience. This time, it would have been the same but for the conflicting utterances by politicians, which made it difficult for the recovery to last. Rahul Gandhi's remarks and his casual approach to this tragic event was a political blunder that will soon be covered up as being misquoted. Prudent players could smell the trouble brewing in Parliament in coming days and that would affect the movements on Dalal Street. Prudence comes faster when one faces tough times. Times may be tough now with rising commodities cost and the rising interest burden may put some heavy industry units and infra companies into a margin squeeze. But one-fifth of BSEs 500 constituents are heaving a sigh of relief. The reason is not far-fetched as the likes of BHEL, LMW, BEL, Siemens, Alstom Projects etc are sitting on a huge pile of cash, thanks to their prudent business practices. They filled their coffers when the others were undergoing a liquidity squeeze and faced with rising cost of funds. Total cash and bank balance liquidity in BSE 500 companies which represent 93% of the total market cap of BSE, has risen 17% in FY11 although the number of cash rich companies may have come down to 100 from 116 in FY10. It has always been a myth that most capital goods and infrastructure companies are burdened with higher debt and resultantly higher interest burden. The easy cash position of such Indian companies, some of which are multinationals and some PSUs, goes to prove that a prudent and conservative approach always pays in trying times. Earnings from treasury operations come in handy to tide over their working capital requirements and even support their clients to obtain meaningful credit. BHEL for instance has adopted the General Electric model of floating a NBFC that would boost its sales by lending to its customers. As long as cash remains a certain percentage of the total assets, its fine. Otherwise, the high negative working capital may instill a sense of complacency and lead to a worrisome situation. Infosys maintains the projected yearly expenditure as its balance in cash or bank while the likes of Hexaware may opt for a huge cash bank balance to manage its potential acquisition spree. FII funds make a huge difference: It is said that only two things influence the stock market - The black money of Indians and the fund flows of the goras (foreigners or firangis). At least for now, the less said about Indian unaccounted money the better. But FIIs are twice as shy this time because their re-entry was much more expensive after that implosion. The net result is for all to see and experience as FII inflows of over Rs.10,027 crore in just ten trading sessions lifted the market cap by Rs.3,75,000 crore - a jump of 6.7% in the Sensex. In a different perspective, it is an inflow of 0.16% of Indias market cap of Rs.64,00,000 crore, which has lead to a gain of 5.87% in market cap. The reason for such an anomaly is not farfetched - there are very few sellers both among domestic institutions and individual investors. Prudence is also visible in the shine witnessed at gold ETF counters. While the Sensex may have lost 11% to 12% between January and June 2011, Gold ETF have done better by gaining 6% in the same period. The growing interest of the investors can be gauged from the net inflows in each of the six months and in fact grew nine fold to Rs.942 crore. The assets under management during this period surged 58.3% at Rs.5,568 crore. Prudence it will be to identify stocks on the basis of Q1 results and also on the basis of positive micro developments. Some names, that deserve a mention on this basis are: (1) KEC International: A strong order book for the country's biggest power transmission player is the singular reason to keep this stock on your watch list. This flagship of the RPG group is a global infrastructure engineering, procurement and construction (EPC) major. With its presence in the verticals of power transmission, power systems, cables manufacturing, railways and telecommunications infrastructure and water management with five manufacturing facilities is the world's second largest tower manufacturing company. Its acquisition of SAE Towers, USA, gives it an edge.
Prudence always pays
It undertakes design, manufacturing, supply and construction of turnkey transmission line projects upto voltages of 800 Kv. It also manufactures lattice towers, poles and hardware apart from providing design and engineering services and tower testing. The power transmission business, however, remains its biggest revenue contributor. In the power systems business, it undertakes design and engineering of substations, rural electrification and electric balance of plant (BOP) projects and cables installation. Providing railway infrastructure including civil works, railway electrification and signalling also remains its key area of operation. On the strength of its infrastructure reach, it provides water resources management services for irrigation projects, embankment and flood control and waste water management. Having presence in 45 countries, it derives more than half of its revenues from exports. Its order book stands at Rs.8000 crore of which 72% is on account of SAE in tower construction and 19% from power systems and 5% from railways. The order from telecom cables and water infrastructure and management contributes the balance 4%. The geographical break up of its orders are as follows: 47% from South Asia, 20% from Central Asia and Africa, 12% from the Middle East and 21% from USA. The government's envisaged investment of Rs.2,40,000 crore and Rs.4,00,000 crore in power transmission and distribution segments in 12th Five Year Plan is an increase of 50% over planned expenditure in the 11th Five Year Plan. On the back of its strong order book and very high execution capability across different segments, the company's revenues and PAT are likely to grow at 18% CAGR over FY11-13. The stock currently trades at 8 times FY12 earnings and 7 times FY13 EPS making it an attractive bet in the medium-to-long-term. (2) Cals Refinery: The proposed petroleum refinery plant at Haldia is inching towards a reality now that the company has reached an out of court settlement with its German equipment supplier. In the first phase of the refinery, the company plans a capacity of 1,00,000 barrels per day (bpd) and proposes to increase it to 2,00,000 bpd in the second phase. The third phase, however, may see it cross 4,00,000 bpd. All these plans are proposed to be financed by various means - GDRs and issue of the shares to its vendors and plant suppliers. The delay since 2008 caused damages to the company when its share price fell from Rs.6.50 to as low as 0.30 paise. This Re.1 FV share is listed at Luxembourg and at BSE is now available at 0.47 paise. Taking a prudent call would not be ill timed at least from the price point of view. Take a little exposure in this stock as the downside can only be half a rupee but the upside, if all goes well, could be 5-10 times as it was in 2008.
TRADING ON TECHNICALS
Volatility between Sensex 19132-18326
By Hitendra Vasudeo Last week, the Sensex opened at 18823.19 attained a high at 18936.43 and fell to a low of 18326.42 before it closed the week at 18561.12 and thereby showed a net fall of 296 points on a week to week basis. Last week, we had mentioned about the spinning top formation, which indicates a momentary halt to the rise. Further direction is decided above the high or low of the spinning top. Therefore, we had mentioned weakness below 18600 to be seen and strength above 19200. We saw the support of 18600 getting violated to make a low of 18326.42. In the strategy, we had indicated to sell below 18600. Traders who managed to implement a sell had the opportunity to benefit. Two weeks back, we had indicated about the 200-day average which was 19132. We saw that on 8 July 2001, when the Sensex tested the 200-day average by making a high of 19131 and formed dark cloud cover pattern. Subsequently, the effect of the same was seen till 12 July 2011. The 50-day average on 12 July 2011 was 18335 and the low made on the same-day was 18326. The averages are being tested and they offer support or resistance. The 200-day average offered resistance and the 50-day average extended support in the last fortnight. Expect volatility between the 200-day average and the 50-day average to be witnessed. Hence, the momentary defined range is 19132-18326. On the weekly chart, we have a trend-line resistance being witnessed along with the
200-day average and has reacted down from the trend line as well taken from the lower tops of 20664 and 19697. A downward week was seen last week as it made a lower lows and lower highs on the weekly chart. First alert of reversal on weekly chart may be seen if the low of 18326 is not violated and the last weekly high of 18936 is crossed to make a higher low and higher high formation. A breakout and close above 19132 may extend the rally. A breakout and close above 19132 may extend the rise towards 19800. Weakness will continue if the last week low of 18326 is violated. On a fall and close below 18300, the Sensex may slide towards 17630 at least.
Wave Tree:
Wave Tree Wave I Wave II Wave III Wave IV Wave IV Wave IV Wave IV Wave IV Wave IV Wave IV Wave IV Wave IV Wave A Wave B Wave C Wave C Wave C Wave C Wave C Wave C (a) (b) (b) (b) (b) a b c c i Month Dec Feb March Jan Jan March 11-Nov 11-Nov Feb April 20-Jun 8-Jul Year 1979 1986 1998 2008 2008 2009 2010 2010 2011 2011 2011 2011 Sensex 113 656 390 21206 21206 8047 21108 21108 17295 19811 17314 19131 Month Feb March Jan 12-Jul March 11-Nov 12-Jul Feb April 20-Jun 12-Jul 12-Jul Year 1986 1998 2008 2011 2009 2010 2011 2011 2011 2011 2011 2011 Sensex 656 390 21206 18326 8047 21108 18326 17295 19811 17314 18326 18326 In Progress In Progress And may have ended 18936 registered on Friday. Remark In Progress In Progress -
Conclusion
Sideways volatility may be seen between the 200-day average and 50-day average range of 19132-18326.
Strategy for the week

Hold short position with a stop loss of 18936. Sell further on fall below 18300 with the high of the day as stop loss or 18936, whichever is higher. Buy above 19132 with the low of the day stop loss or 18326, whichever is lower.
WEEKLY UP TREND STOCKS Let the price move below Center Point or Level 2 and when it move back above Center Point or Level 2 then buy with what ever low registered below Center Point or Level 2 as the stop loss. After buying if the price moves to Level 3 or above then look to book profits as the opportunity arises. If the close is below Weekly Reversal Value then the trend will change from Up Trend to Down Trend. Check on Friday after 3.pm to confirm weekly reversal of the up Trend.
Scrips Last Close Stop Loss Level 2 Buy Price
DISH TV INDIA INDRAPRASTHA GA PETRONET LNG BOMBAY RAYON FA GILLETE INDIA 90.80 393.95 145.60 287.15 2163.00 85.2 380.6 140.5 285.0 2087.0 86.7 383.0 141.7 285.1 2106.7
Center Point Buy Price

89.3 391.5 144.4 287.0 2143.3
Level 3 Book Profit

93.4 402.4 148.4 289.0 2199.7
Level 4 Book Profit

100.0 421.8 155.1 292.9 2292.7
Weekly Relative Reversal Strength Value
Up Trend Date
69.9 68.5 65.7 64.9 64.9
88.6 385.4 141.8 286.1 2127.5
06-05-11 01-04-11 08-07-11 15-07-11 20-05-11
WEEKLY DOWN TREND STOCKS Let the price move above Center Point or Level 3 and when it move back below Center Point or Level 3 then sell with what ever high registered above Center Point or Level 3 as the stop loss. After selling if the prices moves to Level 2 or below then look to cover short positions as the opportunity arises. If the close is above Weekly Reversal Value then the trend will change from Down Trend to Up Trend. Check on Friday after 3.pm to confirm weekly reversal of the Down Trend.
Scrips Last Close Level 1 Level 2 Center Point Level 3 Stop Loss Relative Strength Weekly Reversal Value Down Trend Date
Cover Short
LANCO INFRATEC SAIL GMR INFRA NATIONAL ALUMINIU JAGRAN PRAKASHAN 22.90 131.00 31.65 81.15 111.45 19.6 121.0 29.2 75.6 98.1
Cover Short
22.0 128.1 30.9 79.6 108.0
Sell Price
23.5 132.4 31.9 82.2 114.5
Sell Price
24.4 135.3 32.6 83.7 117.9 25.0 136.7 32.8 84.7 121.0 29.46 31.74 34.48 36.44 38.56 23.73 135.35 32.15 82.74 118.81 29-04-11 15-07-11 15-07-11 17-06-11 08-17-11
PUNTER'S PICKS
Note: Positional trade and exit at stop loss or target, whichever is earlier. Not an intra-day trade. A delivery based trade for a possible time frame of 1-7 trading days. Exit at first target or above.
Scrips
POLY MEDICURE LT FOODS RPG LIFESCIENCE PIRAM LIFE SCIENCE
BSE Code
531768 532783 532983 532979
Last Close
280.70 54.05 85.35 96.05
Buy Price
274.00 53.20 82.60 92.00
Buy On Rise
283.95 54.95 88.25 101.70
Stop Loss
262.50 51.25 77.10 90.10
Target 1 Target 2
297.2 57.2 95.1 108.9 318.7 60.9 106.3 120.5
Risk Reward
0.91 1.14 1.19 2.15
BUY LIST
Scrip
BLUE DART EXPRESS
Last Close
1568.00
Buy Price
1563.25
Buy Price
1538.00
Buy Price
Stop Loss
Target 1
1777.3
Target 2
1991.3
1512.75 1431.00
EXIT LIST
Scrip
PFIZER
Last Close
1436.00
Sell Price
1461.18
Sell Price
1470.50
Sell Price
Stop Loss
Target 1
1382.2
Target 2
1303.2
1479.82 1510.00
TOWER TALK
* Reliance Industries is sulking and not participating at all but its only a matter of time before the scrip comes into form and takes the Sensex and Nifty to new highs. The British Petroleum clearance may be the trigger feel the fund managers. * PSU may sub divide the face value of their shares, to Re.1 to enable wider participation, BHEL, BEL, BEML are the likely candidates in the first round. * Ponder over the tremendous e-trash that is building up in your home and office. The E-trash management is a great business and not too many are in it. So grab Cerebra before it gets out of reach. * As a foolproof method of pricing cooking gas cylinders per household may be allowed at the subsidised rate annually and the balance will come at the market price. Little wonder BPCL, HPCL and IOC show signs of strength to break out of the levels of yester years. * Repro India has posted excellent Q1FY12 result and announced the acquisition of Macmillans printing operation at Chennai. But the share price has already shot up sharply. Book profits now. * Allied Digital Service has again put in a dismal performance for Q4FY11 with OPM down to 8% from 20% in Q4FY10. However all the selling has been absorbed and the scrip is set to make a smart recovery. Keep a close watch. * Deccan Chornicle has started buying back its share from the open market and has already bought around 1.37 crore equity shares at average price of Rs.70 per share utilizing almost 35% of the total Rs.270 crore set aside for this buy back. Scrip may see a sharp rally of 10-15% in the short-term. * NSEs decision to include VIP Industries, BF Utiliites and TTK Prestige into the F&O segments indicates that operators vested interest is much more deserving than A group stocks like Castrol, Godrej Consumers, Marico, Nestle, Pipavav etc., which are ignored by NSE. * Hind Rectifiers is all set to post an EPS of Rs.10 in FY11 and Rs.14 in FY12 on FV of Rs.2 per share. Some analysts project a share price of Rs.80 in the medium-term. * One pharma analyst strongly recommends the long-term investment in Surya Pharma (FV: Rs.1) as it is expected to clock an EPS of Rs.6 in FY12 and Rs.7.5 in FY13 on the back of its expansion. The share is poised to touch Rs.40 in the medium-to-long-term. * Sutlej Industries, from the KK Birla group, posted an EPS of Rs.110 in FY11 on its tiny equity of Rs.11 crore. It is an excellent buy for the long-term. * Ind-Swift Labs is all set to post an EPS of Rs.30 in FY 12 and Rs.35 in FY13. The share is going cheap at Rs.96 and is poised to touch Rs.150 mark in the long-term.
* One fund analyst strongly recommends the shares of TIL for decent gains in the long-term as it is expected to post an EPS of Rs.75 in FY12 and Rs.90 in FY13 on its small equity of Rs.10 crore.
BEST BETS
Elecon Engineering Company Ltd. (Code: 505700)
Rs.77.15
Established in 1951, Elecon Engineering Company Ltd. (EECL) is one of India's largest manufacturers of Material Handling Equipments (MHE), providing a wide product range that is offered only by a few companies in the world. It is also a leading manufacturer of Industrial Gears and Power Transmission products and boasts of the largest manufacturing plant in Asia. From a modest start of being a small manufacturer of Elevators and Conveyors from which it derives its corporate identity viz. Elecon, the company has grown over the years and is known as a pioneer of mechanized bulk MHEs. It is also recognized as the first company in India to introduce the modular design concept, case hardened and ground gear technology under industrial gears segment. For almost six decades, it has been supplying hitech equipment to core sector industries such as steel, fertilizer, cement, coal, sugar, rubber, chemicals, plastic extrusion, lignite and iron ore mines, power stations, defence and port mechanization in India and abroad. It has reputed clientele including NTPC, BHEL, NMDC, Tata Steel, SAIL, BGR Energy, GMR group, Adhunik Group, ACC, Grasim, Jindal group, L&T etc. Having its manufacturing facility in Gujarat, EECL currently operates through the following two business segments: 1) Material Handling Equipment Division (55%): Under this division, EECL provides an exhaustive range of MHEs that only a few companies in the world can boast of. Notably, the company is engaged in design, engineering, manufacture, supply, erection and commissioning of several MHEs including tippers, wagon tippers, stakers, reclaimers, crushers, feeders, scrapers, conveyors, roller screens, ship loaders, wagon loaders etc. Over the years, it has gained special expertise in the designing and execution of turnkey contracts for crushing, screening, stacking, blinding and reclaiming plants for bulk materials such as coal, limestone, iron ore, bauxite, overburden, rock phosphate and fertilizers. Earlier, the company designed, manufactured, supplied and erected a 70 kms long conveyor system for Neyveli Lignite Corporation, which was a big achievement. Recently, it entered into a technical collaboration with M/s. CKIT Conveyors Engineers, Johannesburg, South Africa to avail technical support in pipe conveyors, long distance through conveyor, high speed conveyors and curve conveyors. Further, it is developing high speed conveyors with consultancy support from M/s. Conveyor Dynamics Inc, USA. 2) Industrial Gear Unit (45%): In India, EECL is the largest player in industrial gears with 25% market share and is the preferred supplier for customised gears. It manufacturers a large range of helical gears, worm gears, planetary gears, hi-speed gears, coupling etc. apart from gear motors for precision applications. Its products find application in virtually every industry engaged in manufacturing or in the power generation field. It also has technical skills in providing customized gear boxes for steel mills, high speed turbines, sugar mills, marine vessels, coast guard ships, plastic extrusions, antenna drives and for satellites in the Indian Space programme. It is the first and only manufacturer in India to build MW Class Gearboxes and also the only manufacturers of Vertical Roller Mill Gear for the power and cement industry. Of late, it became the proud supplier of CODOG gearboxes to the Indian Navy for the new generation stealth warship, INS Shivalik. The production of these gearboxes was made in technical collaboration with Renk Gmbh, Germany, world leaders in marine gear technology. Moreover, the company has signed a technical collaboration agreement with Haisung Industrial Company of Korea for availing its technology to design & manufacture the lift gear box. Recently, company has also forayed into manufacture of 1-2 MW capacity wind mill gear boxes, which is essentially an import substitute. In addition to above two SBUs, EECL is now looking to develop and set its foot into the fast growing alternate energy segment and has built up capabilities to manufacture wind turbines in 60 and 50 hz frequencies with globally recognized technologies. For this, it has a technology tie-up agreement with Turbowinds NV, Belgium. Apart from installations in Maharashtra, Gujarat, Tamil Nadu etc., the company has even commissioned two 600 KW wind turbine at Newburyport, MA and Connecticut, Ohio, USA. As of now, the company is estimated to have an installed capacity of 50 wind turbine generators per annum up to 600 KW. To enhance its the global presence and expand its product portfolio, EECL acquired the Benzler-Radicon group of business from David Brown Gear System, UK for around Rs.150 crore in FY11. Benzlers and Radicon are internationally recognised brands for screw jacks, shaft mounted gearboxes, industrial reducers and have a strong presence in UK, USA, Sweden & Thailand. This first overseas acquisition by the company not only complements its existing business but has also thrown open a huge opportunity for exports by providing access to several clients in developed markets like the UK & USA. On a standalone basis, EECL is targeting strong double digit growth and expects the industrial gears segment to be the main growth driver and seeks to explore opportunities in high speed gears, gears for plastic industry, lift gears and vertical rolling mill gears for cement and coal mining. At the same time, company aims to venture into wind mill gear
boxes, sugar planetary gear boxes and marine gear boxes. It has already invested Rs.100 crore in its wind mill gear box facility and targets to become the leading player in the 1-2 MW segment. It constantly emphasizes high level of technology to improve margins for the gear division. On the other hand for the MHE segment, it intends to tap newer markets like mineral processing, coal washeries etc through complementary technologies. Overall, it is striving to enhance the export turnover to 15-20% of the total turnover. Currently, EECL boasts of an impressive unexecuted order book position of Rs.1,577 crore of which 75% is from the MHE division and the balance from the gear division. Importantly for 2010-11, it secured total orders worth Rs.1700 crore, which is more than double the orders bagged by it in 2009-10. In addition, the company has submitted bids worth Rs.5000 crore, which are likely to be finalized in the coming quarters. Of this, it expects to bag about Rs.600-700 crore worth of orders in the next 3-4 months and is already the L1 bidder in Rs.280 crore order for coal handling plant of NTPC. For FY11, its sales improved by 15% to Rs.1177 crore while the MHE business grew by only 5% to Rs.653 crore, the industrial gears segment recorded 25% growth to Rs.524 crore. At the net level, the profit (excluding extraordinary items) rose by 35% to Rs.67 crore. Thus it posted an adjusted EPS of Rs.7.20 on its current equity of Rs.18.60 crore with face value of Rs.2 per share. Going forward, EECL is expected to do well because of the sharp revival in core industries and the massive investments plans of the government in infrastructure development including power. Backed by a healthy order book and with its recent acquisition, the company is expected to clock a consolidated turnover of Rs.1650 crore with PAT of Rs.90 crore for FY12. This translates into an EPS of Rs.9.70. Thus the scrip is currently available at a forward P/E multiple of 7 times, which is grossly cheap. It deserves much better valuation and at a reasonable P/E multiple of 12, its share price can shoot upto Rs.120 (70% appreciation) in 12-15 months.
STOCK ANALYSIS
Vesuvius India Ltd: For steady gains
By Devdas Mogili Vesuvius India Ltd. (VIL), formerly known as Vesuvius Refractories, is a 20-year old Kolkata based company established in 1991. The company was promoted by the Vesuvius group, UK, which at present holds 55.57% stake in the company in association with Biswadip Gupta. Saibal Kanti Gupta is the chairman while Tanmay Ganguly is the managing director of the company. The company is engaged in the manufacture of specialised ceramics required in the continuous casting process of steel making. The products manufactured are shrouds, monoblock stoppers, submerged nozzles and tundish nozzles. The company entered the capital market with a public issue in September 1993 to finance the setting up of a unit to manufacture 3000 TPA of specialised refractories. Later in 1996-97, it came out with a rights issue at a premium of Rs.30 per share in the ratio of two equity shares for every five equity shares held. VIL manufactures specialised ceramics (refractories) required in the continuous casting process of making steel and other metal industries. The Vesuvius group is a world leader in the supply of speciality ceramic refractory consumables used to handle molten metal in the production of steel foundry castings and in photovoltaic (solar) cells. The group has 58 manufacturing locations worldwide. The Cookson group, a leading global materials science company in ceramics, electronics and precious metals markets acquired the Vesuvius group in 1987 and holds 55.6% stake in VIL. The company installed a mixing plant for backward integration in the manufacturing process, and a second plant to expand the production capacity. These measures were initiated to achieve better cost efficiency. Earlier, the company used to import the required mix from its parent, the Vesuvius Group Ltd, UK, a wholly-owned subsidiary of the Cookson Group Plc. (for the busy investor) VIL acquired the assets and manufacturing rights of KSR International (India) Ltd. as PROFITRAK is pleased to announce the launch of Fresh One Buy - Daily (formerly Daily Fresh Buy) for investors/ traders who are keen to focus and also the monolithic plant at Visakhapatnam gain from a single stock every trading day. from Carborundum Universal. It also With just one daily recommendation selected from stocks in an uptrend, obtained the technical know-how from you can now book profit the same day or carry over the trade if the target Answer Technologies Inc., USA, for the is not met. manufacture of Blast Furnace Casthouse Our review over the next four days will provide new exit levels while the Refractories and General Purpose stock is still in an uptrend. Pumpables. This low risk, high return product for the busy investor is available for In 2000-2001, the company ventured into the subscription at Rs.2500 per month. For details contact non-steel sector with its monolithics business moneytimes@vsnl.com or phone on 022-22616970/ 22654805. using a new technology sourced from
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Vesuvius, Germany and acquired the crucible manufacturing unit of Diamant Carbon & Graphite Products Ltd. at Mehsana, Gujarat in March 2003. This is the third manufacturing unit of the company. Crucibles are used in the Non-ferrous industry and this acquisition enhances VILs foray into the non-steel sector. In 2009, it expanded the installed capacity of Shaped Refractories by 90600 Pieces and with this expansion, the total capacity has risen to 419,600 Pieces. All the large steel players like Tata Steel, Sail, Jindal are the customers of VIL. It is the only company catering to the needs of large customers as it has the back-up of strong technologies provided by the parent. Although the domestic steel industry grew by around 8% in calendar year (CY) 2010, VILs domestic sales rose 18% as it was able to improve its market share. There was more sale of high value-added products and penetration into newer markets and newer product lines. In future, too, VIL hopes to grow higher than the steel industry for the same reasons. Almost every large player in the steel industry has set out its expansion plans. Any greenfield as well as brownfield expansion by major steel companies will lead to additional sales for VIL on a one-time as well as continuous basis. All the three plants of VIL are expanding. The Vizag and Mehsana plant expansion was completed in 2010. Phase 1 of the expansion of the Kolkata plant is completed and Phase 2 expansion of was to end in May 2011. This will ensure that VIL has doubled the capacity compared to December 2009. The expanded capacity is targeted at the domestic steel industry. However, till the domestic demand picks up to its expanded capacity level, it will use the surplus capacity for exports. The parent Vesuvius Group has closed down eight subsidiaries in the EU and will outsource its requirements from India and China depending on cost efficiencies and capacity availability. Performance: VILs net sales were up 22% to Rs.440.12 crore and PAT by 28% to Rs.48.85 crore for CY10 and it registered an EPS of Rs.24.07. Financial Highlights: (Rs. in lakh) Particulars Q1CY11 Q1CY10 CY10 Latest Results: During Q1CY11, sales rose 20.59% to Net Sales 11970 9926 44012 Rs.119.70 crore as against Rs.99.26 crore in Q1CY10 while Other Op Income 69 42 368 net profit rose 27.75% to Rs.13.03 crore from Rs.10.20 crore Total 12039 9968 44380 in Q1CY10 recording an EPS of Rs.6.42 for the quarter. Total Expenditure 10133 8432 37173 Interest (net) (56) (28) (164) Financials: The company has an equity base of Rs.20.30 Exceptional Item (109) crore with a share book value of Rs.124.57. Vesuvius is a Tax 659 544 2595 zero debt company with RoCE of 32.46% and RoNW of Net Profit 1303 1020 4885 20.96%. Paid up equity (FV: Rs.10) 2030 2030 2030 Res Ex Rev Reserves 23257 Share Profile: The companys share with a face value of EPS (Rs) 6.42 5.02 24.07 Rs.10 is listed and traded on the BSE/NSE under the B group. Its share price peaked to a high of Rs.419.40 and a low of Rs.250.50. At its current market price of Rs.400, it has a market capitalization of Rs.821 crore. Dividends: The company has been paying dividends as shown here: FY11 - 40%, FY10 - 37.50%, FY09 - 20%, FY08 37.50%, FY07 - 35%, FY06 - 35%, FY05 - 42.50%, FY04 - 30%, FY03 - 27.50%. Shareholding Pattern: The promoter group holds 55.57% stake while the balance 44.43% is with non-corporate promoters, mutual funds and the investing public. Mutual Funds like HDFC, Tata, ING Optimix, UTI have added the companys shares to their various schemes. Prospects: The prospects of the refractories business are linked with the growth of the steel industry. The Indian economy, in general, is on a steady growth mode and has displayed greater resilience than some of the other developed economies around the world. Steel production in India has been steady and steel prices, which were under pressure in the domestic market, improved during the latter part of the year. Most domestic steel makers are facing margin pressure due to the rise in input costs and are concerned with the availability of raw materials. India is set to emerge as the second largest producer and consumer of steel in the next 5 years and refractory being an essential requirement in steel making will witness increased demand. With this in mind, VIL has completed the expansion of its Kolkata factory to double its capacity. Refractory linings offer opportunities for significant growth as they address diversified market segments beyond the steel industry. To keep pace with the increased demand, the company has already made some capacity expansion at its precast plant in 2010 and is evaluating further expansion in its monolithic manufacturing capacity at Vishakhapatnam. Conclusion: VIL is an MNC associate company with an excellent track record. The company is an established player in the refractories business with an excellent clientele. At the current market price of Rs.400, the scrip is available at P/E multiple of around 16. For CY11, it may register net sales and PAT of Rs.538.43 crore and Rs.59.08 crore respectively, which translates into an EPS of Rs.29.1 and discounts future earnings less than 14 times.
Looking at strong and sustainable growth, its future earnings and MNC parentage, the VIL scrip deserves significant rerating. It can be added to ones portfolio for steady gains in the medium-to-long-term.
MARKET REVIEW
Sensex melts on Euro-epidemic
By Ashok D. Singh The BSE Sensex settled at 18,561.92 with a decline of 296.12 points or 1.57% for the week ended Friday, 15 July 2011. The CNX Nifty was down 79.55 points or 1.41% to end at 5,581.10. The BSE Small-Cap index ended marginally lower by 11.92 points or 0.14% to close at 8,363.22. The BSE Mid-Cap index gained 10.44 points or 0.15% to settle at 7,006.75. Both the BSE Small-Cap and the BSE Mid-Cap indices outperformed the Sensex. From the 5 day trading sessions, the Sensex declined in 3 and gained in 2 during the week. The Sensex plunged in choppy trades on growing fears regarding the epidemic of Euro zone debt crisis to large European economies such as Italy and Spain as well as other inclusive parts of euro zone. The impasse over the debt ceiling in USA and back-to-back warnings by Moody's and S&P on US debt also weighed on the sentiment. Industrial output data for May 2011 rose a slower than expected at 5.6% from a year earlier government data showed on Tuesday. April's industrial output growth was revised downwards to 5.8% from 6.3%. Manufacturing output, which constitutes about 80% of the industrial production, rose an annual 5.6% in May 2011 compared with the revised 6.3% growth a month earlier. The government is working with the Reserve Bank of India (RBI) to bring down inflation Finance Minister, Pranab Mukherjee said in a statement on Thursday. He also said that the June 2011 inflation data was a matter of concern and he was monitoring the price situation closely. He further added an increase in fuel prices has a seasonal effect and an upward movement in prices of minerals as well as manufactured products is driving inflation. Chief Economic Adviser (CEA), Kaushik Basu, said that the wholesale price index (WPI) based inflation rate may ease to a little above 6% by March 2012. The latest data showed that the wholesale price index climbed an annual 9.44% for June 2011 driven by higher manufactured goods and fuel prices. The rate of rise in inflation was lower than market expectation of a 9.7% rise. The inflation figure for April 2011 was revised upwards to 9.74% compared to 8.66% reported earlier. July rainfall is considered to be vital as sowing of a number of crops begins in June and good July rains determine the soil moisture and ensure proper development of the crops planted in June. Chhattisgarh and the Vidarbha region in Maharashtra are rainfall deficient however the gap is expected to be bridged over the next few days. The grain bowl northern states of Punjab and Haryana as well as parts of Uttar Pradesh have all received above normal to normal rains while the eastern rice growing states including key producer, West Bengal have received sound rains. Oilseed growing regions in central India have also received sound rains. Market participants will continue to watch the progress of the monsoon rains. Weather officials expect an improvement in the rainfall next week. Monsoon rains were above average in June 2011 however dropped to 3% below average after slowing in the first week of July. Rainfall between July 7 and July 13 was 19% below average while it was 25% below average between June 30 and July 6. As per reports, the rainfall distribution so far has been good except for areas in the country's extreme northwest and southeast mainly in Gujarat's Saurashtra region and the Andhra Pradesh coast. While Gujarat is India's largest groundnut and cotton producer Andhra Pradesh is a key rice producing region. FIIs inflows in July 2011 totalled Rs.6,137.50 crore till 13 July 2011. FIIs had bought shares worth a net Rs.4,572.20 crore in June 2011. FII inflows in calendar 2011 totalled Rs.8,807.90 crore till 13 July 2011. Trading for the week began on a lower note. Weakness persisted on the domestic indices for the second day in a row on Monday, 11 July 2011 as global stocks declined on weak US job data and as euro zone debt worries resurfaced. The Sensex dives 136.65 points or 0.72% to close at 18,721.39 and the Nifty was down marginally by 44.55 points or 0.79% to end at 5,616.10. Key indices extended losses for the third straight day on Tuesday, 12 July 2011 as global stocks slumped on increasing fears related to the European debt crisis which has spread to large European economies such as Italy and Spain. Data showing slower than expected growth in industrial production for May 2011 and a downward revision in industrial production growth for April 2011 also hit the sentiment. The Sensex lost 309.77 points or 1.65% to close at 18,411.62 and the Nifty was down 89.95 points or 1.6% to end at 5,526.15. Key indices snapped the 3 day losing streak on Wednesday, 13 July 2011 as global stocks rose on stronger than expected Chinese Q2 June 2011 GDP data. Data showing a strong 9.5% expansion of the Chinese economy for Q2 June 2011 helped offset the euro zone debt worries triggered by Moody's Investors Service downgrading Ireland to junk status on Tuesday, 12 July 2011. The Sensex swung 184.40 points or 1% to close at 18,596.02 and the Nifty was up 59.30 points or 1.07% to end at 5,585.45.
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Key indices ended marginally higher on Thursday, 14 July 2011 giving up strong intra-day gains as euro zone debt worries resurfaced and after Moody's warned on Wednesday, 13 July 2011 that the US may lose its top credit rating. America is the biggest economy on the globe. The Sensex registered nominal gains of 22.18 points or 0.12% to settle at 18,618.20 and the Nifty was up 14.35 points or 0.26% to end at 5,599.80. Key indices edged lower on Friday, 15 July 2011 snapping gains for the preceding 2 trading sessions on caution ahead of the weekend. The Sensex fell 56.28 points or 0.3% finally to settle at 18,561.92 and the Nifty was down 18.70 points or 0.33% to end at 5,581.10. ICICI Bank closed flat at Rs.1,060.05 last week. The Sensex declined 296.12 points or 1.57% to settle at 18,561.92 for the week. Indian stocks will on Monday, 18 July 2011 react to European bank stress tests results. It will also provide more information on the specific sovereign exposures of the lenders that have been reviewed.
STOCK WATCH Emkay Global Financial Services (Code: 532737) (Rs.39.70) is among the largest full service brokerage
house providing comprehensive advisory services under one umbrella from equity to commodities, from financial advisory to investment banking, from mutual funds to wealth management and from insurance broking to IPOs. Its clientele includes reputed foreign institutional investors, domestic mutual funds, hedge funds, banks, insurance companies, private equity firms, corporate and industrial houses, businessmen and high net worth Individuals. As per last reports, the company has a client base of around 1 lakh non institutional and over 140 institutional clients and an employee strength of over 900, including a 28-personnel rich research team that covers 273 stocks across 18 sectors. It has a retail network of 374 branches and franchisees and an average daily turnover of Rs.1,000 crore. It is a SEBI registered Category I Merchant Banker that provides investment banking services including private placement of equity, private equity, promoter funding, acquisition financing, project finance, qualified institutional placements and advisory on mergers and acquisitions and tax-related issues. It is also engaged in the distribution of savings/investment instruments comprising mutual fund schemes, saving bonds, and IPOs. Of late, the company has ventured into both life and non-life broking businesses and offers policies to corporates and individuals through its 100% subsidiary, Emkay Insurance Brokers Ltd. Under Emkay Fincap Ltd, another 100% subsidiary, it carries out NBFC activities like financing against shares and margin funding. Fundamentally, the company is doing well although the last couple of years were difficult on account of the global financial crisis and the general recession. However, the situation has improved considerably and volumes have also picked up. With India still to emerge as a mature capital market, the company has tremendous growth potential going forward. For FY11 on a consolidated basis, while it recorded marginal 5% growth in net revenue to Rs.132 crore the PAT jumped 25% to Rs.11.80 crore on account of stringent cost controls. This translates into an EPS of Rs.4.85 on its equity of Rs.24.40 crore. At the current market price of less than Rs.100 crore, this debt-free company is trading grossly cheap and deserves much higher valuation. Technically, the scrip is in a bearish mode and making new lows. Despite this, investors are strongly advised to buy this stock at current levels and add more on declines. Its share price can appreciate by 50% to Rs.60 which is the intrinsic book value of the share. ******* The share price of Themis Medicare (Code: 530199) (Rs.155.20) has been continuously correcting over the last 8-9 months and has fallen sharply after its Q4FY11 results. For Q4FY11, the company posted a huge loss of Rs.7.90 crore against net profit of Rs.0.75 crore in Q4FY10 and sales fell by 30% to Rs.33 crore. As per the company statements, the reason for such a poor performance is the temporary reduction of its biotech activities due to some technical reasons. Accordingly for the entire FY11, its PAT declined 45% to Rs.10 crore against Rs.18.70 crore despite revenue registering an increase of 10% to Rs.236 crore. It is one of the reputed pharmaceutical companies with four state-of-the-art manufacturing facilities at Vapi (Gujarat), Hyderabad (Andhra Pradesh) and Haridwar (Uttarakhand). Having a product portfolio of APIs and formulations, it has presence in the growing therapeutic segments like anti-tuberculosis, antimalarials, cardiology, pain management, anti-infectives, haematinics, health & nutrition. Its E MAL brand commands the No.1 position in the anti-malarial segment. Besides, the company is also engaged in co-marketing its research based formulations with other pharmaceutical companies in India and abroad. It has a strong field force of over 500 and a nationwide network of over 2000 stockists, which ensures that its products are readily available across the country. Besides, it has an expanding international portfolio of affiliates across the globe with a presence in 40 countries. Going forward, the company is betting on its Formualtions Division as the API segment is facing tremendous challenges from the Chinese market and fluctuating raw material prices. Presently, domestic formulation contributes around 30% of the total revenue, but in the near future it is expected to rise to over 50%. To achieve this, the company has recently launched a new division Luminous and stepped into an altogether new but fast growing pharmaceutical marketing segment Cosmeto-Dermatology. It has already launched a screen brightening cream and Sunscreen with SPF30 under LUMIXYL
brand. Secondly, it is looking to increase its overseas presence and has plans to enter all 29 EU countries, USA, Canada, Australia with its unique research formulations. Hence all its plants have undergone several international audits and it has recently received the EDQM approval. Financially, although the company has high debt on its books and both sales as well as profit have not recorded any impressive growth in the last few years, it can still be bought at the current market cap of Rs.125 crore. ****** In the current market sentiment, investors are strongly recommended to accumulate Bilcare (Code: 526853) (Rs.391.25), as the scrip is trading at an attractive valuation and can easily appreciate by 50% within 12 months. For Q4FY11 it posted a decent performance and ended FY11 with consolidated net sales of Rs.2287 crore (up 120%) with PAT of Rs.149 crore (up 30%) posting Why Techno Funda Plus is the safest & greatest way for investors? an EPS of Rs.63.50 on its equity of Rs.23.55 crore. Thus the stock is The result is here currently available at P/E multiple of In the last 3-4 months when the market was very weak and the sentiment merely 6, which is grossly cheap for very poor, we recommended good fundamental stocks for 4-6 months such professionally run company. It is investment. a niche player in the pharma And now as the market shows strength, our Techno Funda Plus packaging industry with expertise in recommendations are zooming like anything. delivering research-based packaging Just look at some stocks where we have booked over 10% profit during this solutions to global pharmaceutical period companies. It is the largest player in India commanding 60% market share Alembic Ltd. 19.04% in blister packaging. It has 13 state-ofAtul Ltd. 15.62% the-art manufacturing facilities and 25 BGR Energy 14% representative offices across Europe, GSFC 14% USA and Asia. Its Singapore facility is GNFC 16.12% the world's largest multi-functional Fedders Lloyd 13.6% barrier film processing plant and has J B Chemicals 11.85% been accorded the pioneer status by Sunil Hitech 14% the Government of Singapore for its National Peroxide 17.87% research initiatives. Its state-of-the-art Priyadarshini Spg 19.40% design studio in Pune is the first-ofits-kind in pharmaceutical package Subex Ltd. 29.41% design. It strongly believes in HSIL 20.21% Intellectual Property Right (IPR) and SKF India 6.95% is the only company in its space to Ajanta Pharma 22.30% have filed almost 150 patents for Kajaria Ceramics 22.40% which it has also received an award Glenmark Pharma 14.75% from CII-DIPP in 2009. Apart from Renaissance Jewel 30.68% packaging, the company also offers V-Guard 16.80% material support, services and Dish TV 11.59% complete project management for Amar Remedies 16 % clinical trials. Besides, it has
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Also we had booked 50% profit in Elecon Eng, R S Software, Arvind, Amara Raja Batteries, GSPL & Amar Remedies So what are you waiting for? Subscribe to Techno Funda Plus and earn smartly, safely & systemically For more details, contact moneytimes@vsnl.com
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authentication. In 2009-10, it took the bold step of acquiring the global film business of the INEOS group through an all cash deal of Rs.600 crore. INEOS is a major global player in pharmaceutical blister packaging, films for printing and decoration, shrink film for sleeves, capsules and plastic credit cards. After this acquisition, Bilcare has emerged as one of the worlds largest pharma packaging company. Despite the huge base, the company is expected to register double digit growth over the next 3-4 years. A solid bet for medium-to-long-term. ****** After hitting a low of Rs.27, Spicejet (Code: 500285) (Rs.37.90) has partially recovered and shot up by 30% in the last few days. In early 2011, the share took a sharp beating as a member of promoter family i.e. Mr. Dayanidhi Maran was reported to be involved in 2G scam by the CBI. The investigation is still going on Mr. Maran, has recently resigned as Textile Minister from the Union Cabinet. Although there is no direct involvement of the company in the 2G scam, being a group company the sentiment on the counter has turned bearish. However at the current market price, it seems all the negatives have already been factored in and the risk of a further downfall is minimal. At the same time, the scrip may consolidate at the current level for long as it may witness selling pressure at higher levels. Today, it is one of the fastest growing and second largest low cost carrier (LCC) Indian airline with a passenger market share of an impressive 13.60%. Further, it claims to offer the lowest cost on the per seat basis and boasts of being the only listed airline in India to post an annual profit at the net level. Currently, it has a new generation operational fleet of 29 Boeing 737-800/737-900ER aircrafts and operates 192 flights daily to 21 cities. Importantly, it has one of the highest aircraft utilization rates at 12 hours per day, while its peers utilize around 7-11 hours. In October 2010, it started international operations and launched new flights to Kathmandu & Colombo to emerge as the first LCC and the third Indian private airline to offer international flights. Barely a few months after acquiring the controlling stake in June 2010, Mr. Kalanidhi Maran embarked upon a very aggressive expansion plan and placed orders for 15 Q400s NextGen turboprop aircrafts to Bombardier Inc of Canada. He intends to deploy these aircrafts to strengthen and expand domestic connectivity to Tier II & Tier III cities. As per reports, the company is expected to begin regional operations from smaller cities like Vijayawada, Tirupati, Mysore, Mangalore, Madurai, Nagpur, Indore etc. and has selected Hyderabad Airport as the first base of operation. By 2013, the company intends to expand the total number of its aircrafts to 70, which would include 45 Boeing and 25 Q400 planes. For FY11, its revenue rose by 35% to Rs.2934 crore and net profit jumped up 65% to Rs.101 crore. The profitability would have been much higher had not the company reported a loss of Rs.59 crore for Q4FY11 on account of unprecedented increase in ATF prices. Thus it is one of the best bets in the aviation sector.
FIFTY FIFTY
By Kukku * With the Indian economy back on the growth path, FY11 was a satisfying year for ABC Bearings (Rs.156.40). The growth in the automotive sector, in which the company sells most of its products, surpassed all expectations and the demand for its products was robust throughout the year. ABC utilised near full capacity to meet the increased demand for its products. The plant in Uttarakhand commenced its operations as scheduled and the ramp up in production was gradual in line with customer requirements. The slewing and large bearing project was completed on schedule and within the budget and production commenced in March 2011. Enquiries from customers have been received and the company is confident of improving the capacity utilisation during the year. With all around good economic growth, especially in the auto sector, ABC has posted its best ever sales of Rs.200.27 crore representing a 24% growth over the previous year in its 50th year of operations. With improved capacity utilisation and costs under control, the company was able to improve on all the margins and record good profitability for the year under review. Outlook - The outlook for the year in all sectors of the economy, especially the auto industry, is encouraging. As per various forecasts, India is poised for a GDP growth of above 8.5%. With introduction of new models of vehicles in the segments in which ABC is operating, the company will have greater business opportunities. The industrial bearings segment is also likely to grow strongly this year on the back of robust demand. As its slewing and large bearing manufacturing facility settles down, the company expects increased orders from OEM customers. Since the plant started last year in Q4, benefits of the same will be reflected fully in the current year. Its Turnover/ Inventory ratio, which was around 10.07 compared to an average of 5 in the previous two years, ROCE was 36.75% while RONW at 28% remains very attractive. With an EPS of Rs.24.56, the P/E ratio is attractive at 6.5. Investors can continue to hold or even accumulate this stock on dips for a target price of Rs.200. * Net profit of Shanthi Gears (Rs.43.50) rose 17.62% to Rs.7.01 crore in Q1FY12 as against Rs.5.96 crore in Q1FY11 while sales rose 23.63% to Rs.40.23 crore as against Rs.32.54 crore in Q1FY11. With the ongoing re-structuring, the company
plans to focus on standard products and strengthen its presence in non-standard products. To augment and complement its vast manufacturing facility, it plans to acquire/develop new technology which will give it a competitive edge in the Gearbox Industry. With these measures, the company hopes for a brighter future in coming years. The company is said to be diversifying into manufacturing of compressors and the progress is said to be in an advanced stage. The company has surplus land also of around 88 acres spread at three places, which it can utilize for expansion and diversification. The market value of this land is around Rs.90/100 crore. Investors can continue to hold this stock or accumulate it on dips for decent long-term growth. * Relaxo Footwear (Rs.300) was earlier recommended around Rs.200 level in this column. Restructuring is taking place in this company. Investors can continue to hold the stock or accumulate more on dips for decent growth. * Kilburn Engineering (Rs.66) - There are indications of a slowdown in this sector. Since the plant is in process of shifting to new location, it is possible that its performance may get affected for one or two quarters. But long-term investors can continue to hold this stock or even accumulate if it dips below Rs.63 level. * There is gradual improvement in the business of Zee News (Rs.12.58). Investors can continue to hold or even accumulate it on dips. A sustained closing above Rs.13.25 is likely to give an upmove. * The Goodyear (Rs.368) stock is going very strong and given a good upmove from the level of Rs.240 where a call was initiated. Falling rubber prices are likely to benefit the company. Investors can continue to hold the same. * Technofab (Rs.133.95) has a book value of Rs.134. Its ROCE was above 50% over the last two years. Investors can accumulate the stock on dips as earnings are expected to be good. * Kesar Terminals (Rs.87.35) is a good long-term investment story. Investors can accumulate the stock on dips. * Note: The following stocks have touched new highs during the week Ingersoll-Rand at Rs.545.85, Supreme Industries at Rs.207.90, Gandhimathi Appliances at Rs.315, Elantas at Rs.1959. Investors can book part profit in these stocks at every higher level in stages.
EXPERT EYE
By Vihari
Sathavahana Ispat: Dark horse
The shares of Sathavahana Ispat Ltd. (SIL) (Code: 526093) (Rs.51.25) are strongly recommended for steady appreciation based on its solid performance in FY11. With a likely EPS of Rs.20 in FY12, the share is expected to touch Rs.75-80 in the medium-term. Incorporated in 1989, SIL manufactures pig iron through the mini blast furnace route and operates in the iron & steel industry, which is considered as the core sector. Earlier, it had replaced Tata-Korf technology with China-Shougang technology for pig iron making. It uses the Anshan technology sourced from China for metallurgical coke making. SILs pig iron manufacturing capacity is 2,10,000 TPA and metallurgical coke has gone up to 4,50,000 TPA from 3,00,000 TPA. It commenced its 30MW co-generation of power at its site in the Bellary district of Karnataka from July 2008. Another 10 MW power facility commenced from 23 December 2010. The production from the mini blast furnace is of a high quality and can be assured to contain a minimum iron content of 93.5% and 4% carbon content. With the production of metallurgical coke, SIL is integrated backward for the key input investment newsletter material for iron making. The surplus metallurgical coke production from this Seize profitable investment opportunities before the herd! facility is sold in the nearby market. In Over 50 low-risk, sure gain potential, off-beat stock picks in one respect of power, SIL had already signed a year by the experts at Money Times power purchase agreement (PPA) at 3.25 per Near Term, Mid Term and Long Term recommendations with bookunit. profit prices In FY08, SIL had issued 15.4% stake (49 lakh Regular updates on earlier recommendations shares) to Stemcor Holdings, a strategic Only for those serious about seeking investment profits investor at a price of Rs.60 per share. For private circulation via the internet or by courier only Stemcor is a $6 billion leading consultancy Other relevant market information from time to time firm, which provides marketing, finance and logistic services in the steel industry. SIL Subscription Rates: 6 months: Rs.4000, 1 year: Rs.7000, 2 years: also converted 6.25 lakh shares and 15.70 Rs.12000, 3 years: Rs.15000 lakh warrants issued to promoters at Rs.60 Contact Money Times on 022-22654805 or moneytimes@vsnl.com for a free per share. The funds raised were utilised to sample today! meet the aforesaid coke capacity expansion
Early Bird Gains
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and setting up of the 10 MW power plant. SIL has completed the expansion of the coke making facility by 1,50,000 TPA on 23 December 2010 and augmentation of additional co-generation power of 10 MW and works to de-bottleneck idle capacity in the turbine generator capacity (whereby additional power of 10 MW can be generated through the thermal route) is under progress and is expected to be commissioned in the second quarter of FY12. This will augment its power capacity to 50 MW going forward. SIL is also looking to modernise its blast furnace to reduce production costs. During Q4FY11, net profit climbed 85% to Rs.17.6 crore on 65% higher sales of Rs.191 crore and the EPS stood at Rs.5.3. For FY11, net profit jumped by 122% to Rs.56.5 crore on 76% higher sales of Rs.679 crore and the EPS was Rs.17 and a dividend of 18% was declared. SILs equity capital is Rs.33.4 crore and with reserves of Rs.211.4 crore, the book value of its share works out to Rs.73.3. The promoters hold 42.4% in the equity capital. The foreign holding is 15.6%, institutional holding is 1.1% and PCBs hold 3.7% leaving 31.1% with the investing public. The expansion project for augmenting the co-generation power capacity by 10 MW as also plans to expand the total power generating capacity to 50 MW at Kudithini unit by addition of coal fired CFBC Boiler is expected to be commissioned in second quarter of FY12 as there were some teething troubles earlier. Metallurgical coke and power generation constitute 72% of its revenue with pig iron contributing 28%. Additional capacity of coke and power will enhance SILs revenue and profitability further as the demand and margins are high in this segment. Pig iron is the basic raw material for most engineering products, for foundries and the construction industry. With significant growth in user industries like automobiles, construction, foundries, the demand for iron and steel has increased significantly. The total production of pig iron in India has risen from 1.59 million tonnes in 1992 to an estimated 5.70 million tonnes in 2011. During April-December 2010, the following is the estimated industry scenario as compared to the previous corresponding, period: Crude steel production was at 50.59 million tones - a growth of 4.5%. Domestic steel consumption was at 44.28 million tonnes and rose by 8%, indicating further strengthening of demand. Pig iron production for sale in April-December 2010 was 4.22 million tonnes - a 0.7% decline over same period last year. Steel production is likely to rise to 200 million tonnes by 2020. The proposed investments of Rs.1,50,000 crore to create additional 22.4 MTPA of steel will boost the demand of pig iron going forward. With the enhanced pig iron and coke capacity together with upcoming cogeneration of power at its greenfield site, SIL is confident of taking full advantage of the current uptrend in the iron & steel industry. During FY12, SIL is likely to register an EPS of Rs.20, which would further go up to Rs.24 in FY13. At the CMP of Rs.51, the share is trading at a P/E multiple of 2.5 on FY11 estimated earnings and 2.1 times on FY13 projected earnings. At a conservative P/E multiple of 3.5 will take its share price to Rs.70 in the medium-term and to Rs.84 in the long-term. The 52-week high/low of the share has been Rs.66/39. ******
Sundaram Brake Linings: No brake on profits

Sundram Brake Linings Ltd. (SBLL) (Code: 590072) (Rs.170.80) posted excellent Q4FY11 numbers posting a quarterly EPS of Rs.15. Based on the current going, an EPS of Rs.40 can be anticipated in FY12. The share is going cheap at a forward P/E multiple of just 4.2. Formerly known as Sundaram Abex, SBLL was established in 1976 by T. V. Sundaram Iyengar & Sons. Its subsidiaries, Southern Roadways and Sundaram Industries were formed in collaboration with Abex Corporation, USA, as a public limited company and commenced business in September 1976. Prior to the disinvestment, Abex Corporation hold 16.57% of the company's equity, which was divested in January 1995. SBLL is now a fully Indian company manufacturing automotive, non-automotive and industrial friction materials. Its products are extensively used in commercial vehicles, passenger cars, tractors and motor cycles. Nine decades ago (1912), TVS - T.V. Sundaram Iyengar started one of the earliest rural bus services in India. Today, the TVS group has 30 companies with a combined turnover of US $2.5 billion with 25,000 employees. All the companies are professionally run under the TVS Board's guidelines. The core strength of the group is to manufacture of auto components for the Automobile / Tractor Industry. TVS has diverse activities such as Commercial Vehicle & Passenger Car Distribution / Servicing, Cargo Transportation & Logistics, Spare Parts Distribution through more than 140 fully-owned outlets spread throughout India. TVS also manufactures Motor Cycles, Sewing Needles and Computer peripherals. SBLL has four manufacturing plants with two plants exclusively dedicated to manufacturing asbestos-free brake linings and pads located at Padi in Chennai and at Madurai. All manufacturing plants are strategically located near major Indian ports to improve the turnaround time in servicing global customers.
The combined production capacity of all four manufacturing plants exceeds 1.2 million brake blocks per month. SBLL also manufactures Asbestos-free Woven Clutch Facings, Disc Pads, Flexible rolls, and insitu Bonded Shoes. It is also the preferred supplier to some of the well-known axle manufacturers as original equipment. SBLL is an ISO / TS 16949 and ISO-14001 certified company. Its products have been tested to meet European ECE-R90, American FMVSS 121, Australian ADR 35/38, South African SABS 1506 criteria besides the Indian IS 11852. It has a strong presence in the Indian Original Equipment (OE) space. Just-in-time deliveries are arranged by providing logistic support to ensure zero production stoppage at customers plants. It services the Indian aftermarket through more than 140 TVS owned wholesaler outlets spread across major towns. SBLL exports Brake Blocks to over 60 countries worldwide, supported by a wide variety of part number references for US and European commercial vehicles. Exports increased to Rs. 81.3 crore in 2010-11 from Rs.75.1 crore in 2009-10. SBL has a warehouse facility in North America to service the US and Canadian markets instantly - a pre-requisite to establish its brand presence. A business representative in USA works closely with the US/Canadian brake re-builders and distributors. During Q4FY11, net profit jumped by 76% to Rs.5.9 crore on 14% higher sales of Rs.63 crore and EPS was a hefty Rs.15.2. During FY11, net profit fell 3% to Rs.11.9 crore on 18% higher sales of Rs.236 crore and the EPS was Rs.30.3. A dividend of 40% was paid. SBLL has a tiny equity capital of Rs.3.9 crore that is supported by huge reserves of Rs.93.1 crore, which gives its share a book value of Rs.249 making it a bonus candidate. The value of its gross block is Rs.151.5 crore whereas the debt:equity ratio is 0.4:1. The promoters hold 64.6% in its equity capital, institutional holding is 1.5% and with PCBs holding of 2.4% leaves 31.5% with the investing public. Nearly 4.0% of sales is spent on Research & Development. Over the years, SBLs research infrastructure has been recognized by the Department of Scientific and Industrial Research [DSIR] as a key R&D centre in the friction materials industry. Coming to future prospects, the automobile sector exports in 2010-11 registered a growth of 29% with passenger vehicles up by 2.0%, 2-wheeler segment up by 35% and significantly, heavy commercial vehicle exports also grew by 43% while light commercial vehicle exports also grew by 91%. In tandem with the surge in vehicle production, the country's auto parts industry is aiming for a fourfold growth to around Rs.5,00,000 crore (to $110 billion from $26 billion) by 2020, according to the Automotive Component Manufacturers Association of India (ACMA). SBLL has shown significant growth in the domestic OE market at 33% and exports grew by 12% during 2010-11.It has introduced a wider range of Disc pads for the Passenger car market in the aftermarket segment and was able to offer a wider range to cater to the disc brake pad business. In FY12, SBLL is expected to post an EPS of Rs.40, which would further go up to Rs.45 in FY13. At the current market price of Rs.170, the share is traded at a P/E multiple of just 4.2 on FY12 estimated earnings and 3.7 times its FY13 projected earnings. A conservative P/E ratio of 6 will take its share price to Rs.240 in the medium-term and Rs.270 in the long-term. The 52-week high/low of the share has been Rs.248/146. ******
KNR Constructions: Cementing growth

The prospects for KNR Constructions Ltd. (KNRCL) (Code: 532942) (Rs.133) appear extremely bright as it has received good orders. The share is currently traded at a forward P/E of 5.4 on an estimated EPS of Rs.25 for FY12. Incorporated in 1995, KNR Constructions (KNRCL), is a medium-sized diversified infrastructure project development company with a strong track record of timely and successful execution of projects. It undertakes contracts either on its own or outsources the work to sub-contractors. It provides engineering, procurement & construction EPC services through its three segments viz., Road Transportation Engineering (RTE), Irrigation and Water Management and Urban Water Infrastructure management. KNRCL tapped the capital market in January 2008 with an issue of 78, 74,570 shares at a premium of Rs.160 per share aggregating Rs.126 crore. The IPO proceeds were infused in special purpose vehicles SPVs that execute BOT projects and to contribute towards unsecured loans taken for a BOT project in Andhra Pradesh (AP). The proceeds were also used for purchase of capital equipment and for meeting working capital requirements. KNR Agrotech & Beverage Pvt. Ltd. (KABPL) and KNR Constructions LLC (Oman) (KCL) are subsidiaries of KNRCL. KNRCL is geographically well-diversified with state/NHAI projects in Andhra Pradesh, Uttar Pradesh, New Delhi, Assam and Gujarat. While the South accounts for 70% of the order book as a result of the large size of BOT orders bagged in AP, the rest of the orders are from the East, North-East and the North. KNR has also irrigation and water management related orders on hand.
Its major clients include National Highway Authority of India (NHAI), state government projects funded by multilateral financial institutions such as the World Bank and Asian Development Bank (ADB). KNRCL has 90-acre freehold land with significant portion in adjacent districts of Hyderabad in Andhra Pradesh about nine acres in Karnataka, and 56 cents (about half acre) near Chennai in Tamil Nadu. As part of the national highway development (NHDP) programme, KNRCL has a nine-year relationship with Patel Engineering as a joint venture (JV) partner with 40% stake. The KNR-Patel JV won 10 road construction projects including some build-operate-transfer (BOT) annuity projects as a part of the NHDP phased expansion. For FY11, its consolidated net profit fell by 17% to Rs.54.3 crore on 17% higher sales of Rs.1051 crore. Its OPM decreased by 187 basis points to 13.2% due to the rise in subcontract work bills and spreading & assortment expenses. Interest cost fell 21% to Rs.9.4 crore but depreciation increased by 44% to Rs.46.17 crore. The profit before tax (PBT) declined by 12% to Rs.85.3 crore. The tax outgo increased by 2% to Rs.30.91 crore and the EPS stood at Rs.19.3. In FY11, net profit declined as KNR made an additional provision of Rs.10 crore for sales tax/VAT of earlier years. Its equity capital is Rs.28.1 crore and with reserves of Rs.349 crore, the book value of its share works out to Rs.135 and its debt:equity ratio is 0.48:1. The promoters hold 74% in the equity capital. Institutions hold 7.7% and with PCBs holding 7.8%, leaves 10.2% with the investing public. In February 2011, KNRCL bagged a construction contract worth Rs.333 crore from Oriental Structural Engineering for the Nagpur - Saoner - Betul project. The scope of the work includes four laning of Km 76 to KM 117.5 of the Nagpur - Saoner Betul section of NH-69 in the state of Madhya Pradesh to be completed within a period of 23 months from the appointment date. In June 2011, the Madhya Pradesh Road Development Corporation Ltd. awarded it an order worth Rs.145.9 crore for the Pichhore - Chanderi - Mungawali - Onder - Kurwai Road to be completed within a period of 24 months. KNRCL has also secured an order worth Rs.580.2 crore from Sadbhav Engineering for a road upgradation project in Maharashtra and Madhya Pradesh to be executed within a period of 36 months. Infrastructure in general and roads in particular feature on the Government of Indias immediate execution agenda. The 11th Five Year Plan had set a target US $500 billon on infrastructure spending and this is expected to rise to US $1 trillion during the 12th Plan. Driven by the continued growth in the developing and emerging economies, the growth in the construction sector is likely to witness robust growth. Road development is recognized as essential to sustain India's economic growth. Over $100 billion investment is required over the next 5 years to improve the road infrastructure. Further, investments worth $40 billion in irrigation projects augurs well for the company. The scale of the opportunity and the need for capital to Build-Operate-Own-Transfer (BOOT), the most favoured mode of execution, in the current fiscal situation, provides a compelling need to upgrade infrastructure. The KNR groups business risk profile is expected to improve further over the medium-term as its revenues are expected to increase at a healthy rate supported by an order book of about Rs.1600 crore comprising road construction, irrigation and agriculture. Road orders constitute a major chunk of the outstanding orders. Free 2-day trial offer For With a successful execution track record, its ability to Live market intra-day calls forge joint ventures to foray into larger projects and the repeat orders on a continuous basis from reputed On Mobile or Yahoo Messenger call clients like NHAI, a good clientele and a strong bill MONEY TIMES To Register to book ratio of 1.6 gives visibility of good revenue Provide your mobile number or Yahoo Id & earnings in coming years. Tel: 022-22616970, 22654805 KNRCL is likely to post a consolidated EPS of Rs.25 Email: moneytimes@vsnl.com in FY12 and Rs.30 in FY13. At the CMP of Rs.135, the share is trading at a P/E multiple of 5.4 on FY12 estimated earnings and 4.5 on FY13 projected earnings. Recently, some funds have evinced a keen interest in the stock and mopped up a large chunk of shares. The KNRCL share is recommended with a target price of Rs.200 in the mediumto-long-term. The 52-week high/low of the share has been Rs.214/94.
TECHNO FUNDA
By Nayan Patel
SAMKRG Pistons & Rings Ltd

BSE Code: 520075 Last Close: Rs.84.15
SAMKRG Pistons & Rings Ltd's (SPRL) technological and research capacity in terms of professional skills and resources enables manufactures of advanced Pistons, Piston pins / Gudgeon Pins, Piston Rings & Circlips to endure higher thermal
and mechanical loads. This is critical for engines becoming more powerful, efficient, and less polluting, manufacturing & marketing of good value, high quality and cost effective products meeting domestic and international customer quality requirements. The company has three plants, one in Hyderabad and two in Vishakhapatnam. The company exports its pistons and rings to over 15 countries including USA, Australia, Brazil, Colombia, UK, Germany, France, Poland, Italy, Russia, Iran, Bangladesh, Sri Lanka, South Korea and Japan. SPRL is a major supplier to Bajaj Auto, LML, Kinetic Honda, TVS Motors, Kinetic Engineering and Maharashtra Scooters. OEMs constitute 85-95% of its sales while the rest is for the replacement market. It has an equity base of just Rs.9.82 crore that is supported by reserves of around Rs.42 crore. The promoters hold 66.34%, non-promoter corporate bodies hold 2.87% while the investing public holds only 30.22% stake in the company. For Q1FY12, it recorded net sales of Rs.57.28 crore with net profit of Rs.3.38 crore against net sales of Rs.47.59 crore with net profit of Rs.2.18 crore in Q1FY11. For FY11, it recorded net sales of Rs.170.13 crore with net profit of Rs.9.92 crore against net sales of Rs.132.93 crore with net profit of Rs.7.11 crore in FY10. The Q1FY12 EPS is Rs.3.44 while FY11 EPS was Rs.10.10. At the current level, the stock is available at forward P/E multiple of just 6.3. The company has been consistently paying dividends as shown below: FY10- 40%, FY09 - 30%, FY08 - 35%, FY07 - 35%, FY06 - 30%, FY05 - 50%, FY04 - 45%, FY03 30%, FY02 - 15%, FY01 - 30% and it has declared 45% dividend for FY11. Investors can buy this stock with a stop loss of Rs.78. On the upper side, the stock will zoom to Rs.103-105 level in the medium-term.
Inventure Growth & Securities IPO opens on 20th July

Inventure Growth & Securities Ltd. the flagship company of the Inventure Group will offer 70 lakh equity shares of Rs.10 each via the 100% book building route in third week of July 2011. The equity shares of the Company are proposed to be listed on the BSE and NSE. The Company has membership in the cash and derivatives segment of both BSE and NSE, currency futures segment of BSE, NSE, MCX Stock Exchange Ltd. (MCX-SX) and wholesale debt market segment of BSE and NSE. It is also a member of OTC Exchange of India (OTCEI). The objects of the Issue include investment in its subsidiary Inventure Finance Private Ltd., augmenting long term working capital requirement and to achieve the benefits of listing on the stock exchanges.
MARKET FOLIO
SCI accepts delivery of a Supramax Bulk carrier, Vishva Vijeta

SCI had signed contracts for the acquisition of two Supramax bulk carriers that were under construction at Guoyu Shipyard, China and accepted delivery of one on Tuesday, 12 July 2011. The vessel has a gross tonnage of 33,032 tonnes and deadweight of 56,638 tonnes. The vessel has been classed with BV and IRS and has been built to comply with the latest and most stringent international regulations. This will be the first vessel in SCI fleet to be equipped with camless electronic Main Engine. Strengthening its bulk carrier fleet would help SCI increase its presence in the bulk carrier segment. With this addition SCIs fleet strength has risen to 79 vessels. The company has 30 vessels on order at present and 12 of these are scheduled for delivery by the end of 2011.
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