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paragdesai
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Joined: 22/Oct/2007
Location: India
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Posts: 837
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   Posted: 12/Sep/2011 at 2:53pm |
Originally posted by manish_okhade
Below data is taken from PPFS report.
Average cost /engine = 79564/-
Peak Capacity = 60,000
Sales = 60,000x79564 = 477 Cr
If PM = 11% THEN NP = 477 X 11% = 52 Cr by FY12.
FY11 NP was 43.9 Cr so it gives very less upside potential, am i missing something here?
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Fy 11 NP is for around 47000 odd Engines. Now they are planing for around 75000 odd Engines per year. http://www.bseindia.com/xml-data/corpfiling/AttachHis/Swaraj_Engines_Ltd_050511.pdfSo NP Should increase in proportion from here. In case of reduce RM price & improved efficiency NP should be more. In future in case M&M more expand their other Manufacturing activity in North India than we can have more expectation from SEL. Few important Persons are sitting on SEL board. So they are looking at this company seriously.
Edited by paragdesai - 12/Sep/2011 at 3:12pm
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Luck is what happens when preparation meets opportunity ....
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paragdesai
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Posted: 12/Sep/2011 at 3:10pm |
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Luck is what happens when preparation meets opportunity ....
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manish_okhade
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Joined: 20/Oct/2008
Location: India
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Posts: 1997
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Posted: 12/Sep/2011 at 6:53pm |
Hello Paragji,
Dic is not opening, can you pl mail me at [email protected].
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paragdesai
Senior Member
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Location: India
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Posts: 837
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Posted: 12/Sep/2011 at 7:10pm |
Originally posted by manish_okhade
Hello Paragji,
Dic is not opening, can you pl mail me at [email protected]. |
Done.
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Luck is what happens when preparation meets opportunity ....
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manish_okhade
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Joined: 20/Oct/2008
Location: India
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Posts: 1997
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Posted: 12/Sep/2011 at 7:34pm |
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New calculation looks like below:
FY11 Data:
Sales: 360.6 Cr
No of engines sold: 47413
Unit cost of engine = .93 x 360.6/47413 = 70731/-
Mar FY12 projection:
Production capacity: 60,000
Sales: 60,000x70731 = 424 Cr
NP = 424X11% = 47 Cr
So capacity increase of 47K to 60K may not result in too much change in the profit but real benefit will come from FY13 onward when capacity is 75K.
June FY12 projection:
Production capacity: 75,000
NP= 63Cr
So this enhanced capacity will spillover to FY13 and might take 1-2 qtrs more to realize full 75K Capacity.
Another plus is MnM may buy more stack or make it its 100% subsidiary too.
Key Risks:
1) Tractor demand from the MnM - volume degrowth will affect SEL too.
2) RM Cost - But it seems to go down further and migh increases the PM.
Opportunity is definitely good but CMP is not favorable. I guess CMP already factors in the expansion plans. So new investor has to wait for 2 years to get the benefits.
I would like to buy on strong dips to have some safety.
Edited by manish_okhade - 12/Sep/2011 at 7:42pm
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nannu_68
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Location: India
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Posts: 308
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Posted: 12/Sep/2011 at 9:02pm |
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M&M has commissioned its tractor factory in China... how does that impact Swaraj??
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nannu
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paragdesai
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Joined: 22/Oct/2007
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Posted: 12/Sep/2011 at 9:12pm |
Originally posted by nannu_68
M&M has commissioned its tractor factory in China... how does that impact Swaraj??
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I don't think it impact in anyway to SEL.
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Luck is what happens when preparation meets opportunity ....
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shontou
Senior Member
Joined: 04/Aug/2011
Location: India
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Posts: 865
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Posted: 12/Sep/2011 at 11:28pm |
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I am quoting the following from International Tractors::Takeaways Motilal Oswal Annual Global Investor Conferences as it throws light on prospects of Tractor Indistry in India:-
Key Takeaways
Fourth-largest tractor manufacturer in India
International Tractors is the fourth largest tractor manufacturer in India. It provides a
complete product line, including tractors, multi-utility vehicles, engines, farm machinery
attachments, diesel gensets, auto components, and pick & carry cranes. It has tractor
manufacturing facilities in Punjab, with total capacity of 70,000 units. Majority of its
tractor exports are to North African and SAARC countries.
Expects 18-20% CAGR (FY11-15) for the industry
The management expects the size of the Indian tractor industry to reach 0.54m
units by FY12 (~13% growth) and ~1m units by FY15 (CAGR of 18-20%), driven by:
Global food shortage driving up crop yields and prices
Low tractor penetration levels (especially in the southern region)
Government support by higher allocation of expenditure to agriculture
Higher non-farm income (NREGA, etc)
Rising labor cost and lower availability of labor
Increasing access to finance through banks and NBFCs
Emergence of corporate farming
Regionally broad-based growth, with West and East growing rapidly (over 50%), as
against higher dependence on the northern states, earlier.
40-50HP segment is gaining traction, driven by additional non-farm applications.
Edited by shontou - 12/Sep/2011 at 11:28pm
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Every day, self-proclaimed stock market "experts" tell us why the market just went up or down, as if they really knew. So where were they yesterday?
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