Emerging companies - Mid caps that can become large cap : Voltas

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Voltas - Targeting 4x revenues in 3 yrs !

Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Emerging companies - Mid caps that can become large cap
Forum Discription: These are companies operating in growing markets having have certain niches or specific attributes like new sector plays. These are emerging multibaggers with high risks and high rewards.
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=1561
Printed Date: 03/May/2025 at 3:51am

Topic: Voltas - Targeting 4x revenues in 3 yrs !

Posted By: deveshkayal
Subject: Voltas - Targeting 4x revenues in 3 yrs !
Date Posted: 28/Jan/2008 at 9:59pm

Voltas, a Tata group company, is a leading player in India's Heating, Ventilation and Air Conditioning (HVAC) market, having a ~28% market share in electromechanical projects. The company offers engineering solutions for a wide spectrum of industries in areas such as HVAC, refrigeration, electromechanical projects, textile machinery, machine tools, mining and construction equipment, materials-handling vehicles, water management, building management systems, indoor air quality and chemicals.

CMP: Rs.220

Market Cap: Rs.7274 crs

Revenues (9M FY08): Rs.2232 crs

EPS (FY07): Rs.5.62

EPS (9M FY08): Rs.4.62 (Q3 FY07 - Rs.2)

ROE (FY07): 38%

ROCE (FY07): 26.6%

EBIDTA margins: 8.3% in Q3FY08 (up from 4.8% in Q3 FY07)

Break-up: Electromechanical segment - 7.4% in Q3 FY08 (up from 5.1% YoY)

Unitary cooling segment - 5.2% (Manufacturing opearations were shifted to Himachal Pradesh where it enjoys excise benefits, loss in Q3FY07)

Engineering segment - 17.7% (down from 21.4% in FY07, Margins fell because engineering products earlier used to be a commission business, with no material costs, while it has now become a manufacturing business )

Order Book: Rs.3460 crs (up 44% YoY)

Break-up: International Market - Rs.2700 crs

Domestic market - Rs.760 crs

Electromechanical Segment

Voltas with an impressive track record of having executed contracts in 30 countries is an established MEP contractor in Middle East and part of South East Asia. The business potential of the amusement, leisure and entertainment industries in the Middle East is pegged above US$ 10 billion, excluding the land and the construction costs which experts are expecting to witness 27% CAGR for the next five years.Middle East contributed 26.3% of Voltas revenues in FY07. Voltas is one of the MEP sub-contractor for Burj Tower, World's Tallest high-rise building. Voltas has executed some prestigious projects like the Emirates Mall, the worlds biggest mall beyond North America, Hong Kong airport, Emirates Palace Hotel to name a few.

Unitary Cooling Segment

This segment consists of room air conditioner, water coolers, water dispensers and commercial refrigerator. Voltas has a 16% share in this market.

Engineering Segment

This is a trading business where it markets products of its principals besides its own manufactured forklift trucks. It supplies engineering and capital equipment such as mining and construction equipment, textile equipments, machine tools to various segments.

Recommendation: Company has given a guidance of Rs10,000 crore turnover and NPM at 10% by FY11 which results into 4 times growth in revenues and 400bps increase in NPM in 3 years. The new civil aviation policy is expected to result in 35-40 new airports. Many real estate companies have made public their plans to make five star hotels. Many corporate hospitals, software parks, organized retail and muliplexes are coming up all over the country. The demand will be huge. At Rs 220, the stock trades at about 24x FY09E. Voltas is expected to grow at a CAGR of over 55% in the next two-three years.

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Replies:

Posted By: omshivaya
Date Posted: 28/Jan/2008 at 10:15pm

Thanks for the introduction Devesh jee.

Even after the current carnage, is it still trading at 24X FY09 EPS? Seems a bit pricey for me. I would try getting an entry around a forward PE of not more than 18 and that comes to a price around 165. There are other plays around too for a >55% CAGR but available at lower forward PE.

Just my 2 cents, hope it is okay my sharing and no offence meant to anyone!

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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it

Posted By: nitin_jagtap
Date Posted: 28/Jan/2008 at 11:00pm

Voltas would command a premium compared to say a bluestar or hitachi one reason being their diverse portfolio of services that they offer.

Below are result highlights for Q3

Topline grows 17% YoY during 3QFY08, 31% YoY during 9mFY08. Growth led by strong performances from engineering agency and unitary cooling businesses.

Operating margins surge from 4.8% in 3QFY07 to 8.3% in 3QFY08. Lower raw material and other costs aid this expansion.

Expansion in operating margin coupled with lower interest costs and higher extraordinary income aid strong growth at the net profit level. Excluding the extraordinary effect, net profit growth still stands at a strong 120% YoY during 3QFY08.

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Warm REgards
Nitin Jagtap

Posted By: omshivaya
Date Posted: 28/Jan/2008 at 11:33pm

Sorry to butt in again. If the rate of growth(anticipated for next 3 years) is 60%, then 18 forward PE is a great entry.

Since I know very less about Voltas...if someone is expecting a much better growth rate for next 3 years, simply multiply that growth rate with 0.3

This would ideally be the forward PE I shall pay for buying any business with enough margin of safety(in case the earnings underperform from what one projects). That being said, things aren't always ideal in the world.

Hope this helps if anyone wants to buy into this business. Voltas is a good company is all I know, from the user experience I have had of using its AC.

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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it

Posted By: swapan
Date Posted: 28/Jan/2008 at 11:19am

Along with Blue star this is a great company, I have long been optimistic on both of them .

Voltas I think is more well diversified than Blue Star. Also it is Tata managment.

Below is earnings predicted by equitymaster. (I belive EPS predictions are on the conservative side)

Rs m)	FY07	FY08E	FY09E	FY10E

Revenue (Rs m)	25,268	34,520	45,401	57,730

PAT (Rs m)	2,016	2,706	3,646	4,770

EPS (Rs)	6.1	8.2	11.0	14.4

P/E (x)	39.3	29.3	21.7	16.6

Price to BV (x)	18.7	13.2	9.4	6.9

Posted By: deveshkayal
Date Posted: 29/Jan/2008 at 1:23pm

Revenue visibility, excellent ROE's and ROCE's and a great management will never make this stock look cheap.

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: basant
Date Posted: 29/Jan/2008 at 2:54pm

Along with being an engineering and a cooling company Voltas has plans for aggressively getting into the cold storage/warehousing segment.

I think this is a fabolous business to own.

Devesh any idea where you read that management target in terms of topline and bottomline targets.

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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: sandeeptulsiyan
Date Posted: 29/Jan/2008 at 3:26pm

I completely agree with you basant. India is the econd largest producer of fruits & vegetables, but its sad to know that about 43% of this production is wasted as it lacks cold storage/warehousing facilities. Only about 1.3% of fruits and vegetables get processed in India while this number is about 70% in the US.

Currently, cold storage exists only in 9% of markets. Also, the infrastructure for cold storage is outdated and is primarily designed for storing only potatoes and potato seeds.

Bluestar is currently having multi-projects in this area,while Voltas is still to explore it. But, due to hurdles like real estate prices(as cold storages require huge space, a typical cold storage of 500MT capacity will require at least 500 sq m of land ) it is difficult for the company to enter into it easily. Government subsidy in the XIth plan will provide some help.

Also, the onset of major retail players like Walmart, Carefour, Sears,Tesco will boost the demand for this business segment. Government has in store plans for building Mega food Parks(30 of them are already in the pipeline) & Agri-Export Zones which will further swell demand for cold storages.

Hence,I will stay bullish on this stock and gather it as much as I can.

Thanks omshivaya,
that was truly some gyaan i wasnt aware of. I will try and apply it to the stocks which i track. Thanks once again.

Posted By: shivkumar
Date Posted: 29/Jan/2008 at 3:33pm

Originally posted by omshivaya

Thanks for the introduction Devesh jee.

which are these companies? a short intro on them could prove very educative for TEDdies.

Posted By: omshivaya
Date Posted: 29/Jan/2008 at 3:39pm

Uh, how about Yes Bank a few days back for starters?? No education needed for that :-)

I have vested interest in it, so kindly do due diligence!

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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it

Posted By: shivkumar
Date Posted: 29/Jan/2008 at 3:42pm

Originally posted by omshivaya

Uh, how about Yes Bank a few days back for starters?? No education needed for that :-)

I have vested interest in it, so kindly do due diligence!

had my fill of Yes Bank at Rs 161 but yeh dil maange more! YB is almost ten per cent of my portfolio now! fifty per cent appreciation in less than a week and counting...

Posted By: omshivaya
Date Posted: 29/Jan/2008 at 5:20pm

Shive jee, something growing at above 60%(minimum I hope) and you got a chance to get it at 16 forward PE. And still "just 10% of portfolio". Hmmm...not greedy enough when others were fearful(WB). Anyhow, good that you took some advantage of it at least. And this short-term appreciation can be gone tomorrow so please do not focus on that 50% in a week thing. 3 years par aankhen rakhiye please!

This is it. No more talk of Yes Bank on Voltas' thread. Sorry Devesh jee. Admin jee, boot all previous Yes Bank posts(if you wanna) to the relevant thread.

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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it

Posted By: SORUB
Date Posted: 29/Jan/2008 at 6:24pm

i have seen voltas a.c in lot of places,BSNL uses voltas A.C. i think it wil be nice to own voltas and bluestar... and 2 week back went to a annual day function in L&T, they were using LG

..

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K.I.S.S(keep it simple silly) is the most easy management formula i ever came across!!! but it is very hard to follow!!!

Posted By: deveshkayal
Date Posted: 04/Feb/2008 at 10:18am

Voltas may bag a large order from overseas worth Rs.600-800 crs. (DNA)

Yesterday, CFO of the company said to NDTV that while guidance remain, ROCE will also be in focus. Company is looking for acquistions in the MEP and engineering space. They are doing a water treatment project in Salt Lake, Kolkatta....Basantji any comment on this !

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: sandeeptulsiyan
Date Posted: 05/Feb/2008 at 1:31pm

Hi Deveshji.
Hope i can throw some light on the qestion you have raised.

In the MEP business (which is one of the 4 business segments of Voltas) order book is a key figure to be tracked as it gives an estimate on what will be the future earnings of the business. On an average, a domestic project takes 12-15 months to be completed and an international project takes about 2-2.5 years to be completed. Hope this information will help you estimate the earnings of Voltas in the coming quarters and discount them to arrive at your estimates of profits it is going to make.

Posted By: basant
Date Posted: 27/Mar/2008 at 1:15pm

I bought Voltas today. Stock at less then 20 times Fy09 and growing at more then 50% CAGR seems what people could say growth at (a very) reasonable price.

Posted By: smartcat
Date Posted: 27/Mar/2008 at 1:42pm

It's blasphemy! It's Sacrilegious!

you didn't buy Blue Star?

Posted By: basant
Date Posted: 27/Mar/2008 at 2:02pm

Blue Star is also on the radar but I found the growth at Voltas 50%-60% CAGR just too much to give it a pass. Also there is a valuation difference but the impact cost at Blue STar wipes it off to some extent.

At these prices Voltas traedes at 18-20 times Fy 09 for a 50% growth and Blue Star at about 14 times Fy09 for a 40% growth.

In one of the conference calls the management of Blue Star also applauded Voltas for its capability in handling large scale turnkey projects (MEP). He mentioned that this is where Voltas is ahead and is able to bag larger orders.

As usual the diversified portfolio should have both but between the two there isn't much to choose really.

Posted By: gopal
Date Posted: 27/Mar/2008 at 2:38pm

Basantji / Smart cat bhai,

I had taken a very small exposure to Voltas yesterday by mistake ...

but after reading both your thoughts ....... I will hold on to it and try to increase its qty when more funds are available,

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: nitin_jagtap
Date Posted: 27/Mar/2008 at 2:44pm

Originally posted by gopal

Basantji / Smart cat bhai,

I had taken a very small exposure to Voltas yesterday by mistake ...

but after reading both your thoughts ....... I will hold on to it and try to increase its qty when more funds are available,

Gopalji ..many times mistakes become great investments .....btw what was the mistake was it that you said something and the broker heard something else and he bought voltas instead of something else.

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Warm REgards
Nitin Jagtap

Posted By: gopal
Date Posted: 27/Mar/2008 at 3:21pm

Originally posted by nitin_jagtap

Originally posted by gopal

Basantji / Smart cat bhai,

I had taken a very small exposure to Voltas yesterday by mistake ...

but after reading both your thoughts ....... I will hold on to it and try to increase its qty when more funds are available,

Gopalji ..many times mistakes become great investments .....btw what was the mistake was it that you said something and the broker heard something else and he bought voltas instead of something else.

It was punching error I think yesterday I had given on phone the order for larsen, ril, pantaloon retail but somehow he purchased them, on the next punching was for Voltas but by mistake in client code he punched in mine, he noticed this by late evening, he agreed to take it back .... but I agreed to keep it since qty was less .......

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: catcall
Date Posted: 27/Mar/2008 at 7:22pm

Originally posted by gopal

Originally posted by nitin_jagtap

Originally posted by gopal

Basantji / Smart cat bhai,

I had taken a very small exposure to Voltas yesterday by mistake ...

but after reading both your thoughts ....... I will hold on to it and try to increase its qty when more funds are available,

Gopalji ..many times mistakes become great investments .....btw what was the mistake was it that you said something and the broker heard something else and he bought voltas instead of something else.

Some investments, like all marriages ,are made in heaven, but don't worry, Voltas is an excellent buy!

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There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing!

Posted By: tigerz_style
Date Posted: 27/Mar/2008 at 7:23pm

This segment we have other players like Videocon,Hitachi,BPL (All listed) and not to forget that local desi AC manufacturer's as competition to Voltas. Also Voltas has the costliest AC's.

Posted By: gopal
Date Posted: 27/Mar/2008 at 7:28pm

Originally posted by tigerz_style

This segment we have other players like Videocon,Hitachi,BPL (All listed) and not to forget that local desi AC manufacturer's as competition to Voltas. Also Voltas has the costliest AC's.

Tiger Bhai,

After becoming an accidental investor in Voltas and seeing smart cat / basant ji's msg ... I went through company website .... although they are into retail sales of small A/c for residence but they also make very big a/c for malls, cold storage, truck fleets, etc ..... i think that its only real competition in india can be from blue star or l&t maybe

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: tigerz_style
Date Posted: 27/Mar/2008 at 7:30pm

Voltas launches elegant, new range of Room Air Conditioners in 2008

March 12, 2008

Voltas Ltd has announced that the Company has launched a whole new range of sleek-looking Room ACs in India for the premium and luxury segments. Functional as well as elegant, the new models are bound to heat up the AC market in the summer of 2008.

Among the new models the first Corner AC to be introduced in India, the Vertis 'Pristine'. With a unique, triangular shape, the Pristine has been designed to fit discreetly on the wall in the corner of a room. It is therefore expected to be an instant hit with discerning consumers in upper end homes.

The portfolio also includes several new product ranges for consumers - the Vertis 'Panache', with the revolutionary DC Inverter Technology AC and a versatile Heating-Cooling function; the Vertis 'Elan'; the Vertis 'Elite'; the new-look Vertis Gold, the flagship Vertis Plus, and of course, the Vertis 'Pristine', the first Corner AC to be seen in India.

Voltas were the first Company to go mainstreem with Star Rated Ace last year, complying voluntarily with the government's energy efficiency-labeling program and system of test checks in government-approved laboratories, delivering clear-cut savings on electricity costs. The Voltas range includes 'Star Rated' ACs in both Splits and Windows, going right up to the most-efficient 5-star rated units. Voltas Room Air Conditioners are therefore fully geared up to deliver economical performance in 2008 and this, combined with their elegant looks, makes for a formidable product offering.

Voltas announced the launch of a total of 42 new models this year, at a press conference on Wednesday Speaking on the occasion, Mr. Pradeep Bakshi, Vice President, Voltas said: Our endeavor in the Air Conditioning market is to lead the industry and make really good-looking as well as economical products available to all segments of consumers. We were the first to launch Star Rated ACs in 2007, to provide a power- efficient, money-saving option that is particularly relevant in these days of high electricity tariffs. This year we are introducing a whole new range of ACs with really exclusive designs. Our Vertis Pristine and Panache ranges in the premium segments of the ACs will compete with the best luxury brands in the market. As a Tata Company, this is how Voltas seeks to provide superior solutions for households in a cost- effective manner.

The AC market, estimated to be 20 lac units (Windows and Splits) in 2007, is growing at a robust rate of 30% per annum. With their pioneering launch of Star Rated ACs last year, Voltas gained market share and are currently estimated to sell around one out of every six ACs sold in India, a 17% market share. Their new launch promises to grow the market further, since the products are backed with an advertising budget of Rs 30 Cr. Voltas also have an extensive distribution network of exclusive sales and service dealers in the country, in addition to being available at all leading retail and consumer electronics stores. With a stated target of achieving 20% market share, the Company has put in place an aggressive distribution strategy to increase the number of Channel Partners from the current 2000 to about 3000 next year. Voltas is also investing around 2% of its turnover today in beefing its service infrastructure, to give the best service experience to customers.

Finally, Voltas' India Ka Dil, India Ka AC campaign has had a special resonance with consumers, appealing to the pride of Indians in the new emerging India, a booming economy and the feeling that India has now arrived on the global stage. It is in complete contrast to the feature-led advertising strategy followed by other Air Conditioning and Consumer Durable Marketers and is, for that reason, all the more successful in getting a big share of mind in this crowded marketplace. The coming summer, therefore, promises a battle royal in the AC market between 'India Ka AC' and the international Companies.

If we calculate the domestic Sales taking the above factors mentioned

AC market 2007:- 20 lac units

Growth rate :- 30% pa

AC market for 2008 :- 26 lac units

Voltas AC 's sold (1 out of 6 factor) :- 433333.33

Price (Assumption = Rs 20000 taking into acc avg for both split and window) = 866 crore

I hope my calculations are correct

Posted By: reetesh
Date Posted: 27/Mar/2008 at 7:45pm

I wonder how when Basantji buys a stock every news becomes or termed as "positive" and when he sell something everything becomes "negative" :)

Nothing against you Basant sir, you are really brave and ready to take criticism (in any) by disclosing you portfolio changes.

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When going gets tough, that’s when tough (people) gets going.

Posted By: kulman
Date Posted: 27/Mar/2008 at 7:50pm

Originally posted by reetesh

I wonder how when Basantji buys a stock every news becomes or termed as "positive" and when he sell something everything becomes "negative" :)

YES (pun intended)! Sochne waali baat hain!

Reetesh jee....you changed your tagline. What happened to Churchill's kite?

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Life can only be understood backwards—but it must be lived forwards

Posted By: catcall
Date Posted: 27/Mar/2008 at 7:51pm

Originally posted by tigerz_style

This segment we have other players like Videocon,Hitachi,BPL (All listed) and not to forget that local desi AC manufacturer's as competition to Voltas. Also Voltas has the costliest AC's.

Not fair to categorise Voltas as a AC manufacturer only, here are some of it's other forays:

Electro-Mechanical Projects & Services
Electrical, Mechanical, HVAC & Refrigeration Solutions

Electrical, Mechanical & HVAC Solutions (International)
Water Management & Treatment

Engineering products & Services
Textile Machinery

Mining & Construction Equipment
Machine Tools
Materials Handling Solutions

Unitary Cooling Products for Comfort & Commercial Use
Cooling Appliances

Commercial Refrigeration

Others
- Chemicals Trading

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There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing!

Posted By: reetesh
Date Posted: 27/Mar/2008 at 8:00pm

Kulman jee: Hawa dhire ho gaya hai abhi, too ussiko uddane keliye kosis kar rahe hai

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When going gets tough, that’s when tough (people) gets going.

Posted By: smartcat
Date Posted: 27/Mar/2008 at 8:30pm

I agree. It has been a long time since we've had a verbal fight that goes into 3 pages.

Good work, Reetesh.

Posted By: reetesh
Date Posted: 27/Mar/2008 at 8:40pm

Thanks a lot...

This is not for enticing fight but for them who are doing it, and there is history to prove it.

All these sudden optimism, lure`s people to invest in stock and a genuine call from Basant ji look like a "TIP" which is not good for anyone.

This has happend in stocks like YES BANK and AXIS BANK

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When going gets tough, that’s when tough (people) gets going.

Posted By: reetesh
Date Posted: 27/Mar/2008 at 8:47pm

And let me say this unequivocally that I have nothing against Basant ji, as I said he is brave and courageous enough to make these call and come openly and talk about it.

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When going gets tough, that’s when tough (people) gets going.

Posted By: basant
Date Posted: 27/Mar/2008 at 9:08pm

Tips are one liners and if anyone takes it like that then there is very little that I can do. All stocks that I own and recommend have detailed exhaustive writeups with pros and cons and finally there is always a caveat emptor:-)

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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: tigershark
Date Posted: 27/Mar/2008 at 10:20pm

has anyone visited hyd int airport?

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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things

Posted By: bawa_khalsa
Date Posted: 27/Mar/2008 at 10:42pm

Nice Calculations..............Good Data

Originally posted by tigerz_style

Voltas launches elegant, new range of Room Air Conditioners in 2008

March 12, 2008

.If we calculate the domestic Sales taking the above factors mentioned

AC market 2007:- 20 lac units

Growth rate :- 30% pa

AC market for 2008 :- 26 lac units

Voltas AC 's sold (1 out of 6 factor) :- 433333.33

Price (Assumption = Rs 20000 taking into acc avg for both split and window) = 866 crore

I hope my calculations are correct

Posted By: subu76
Date Posted: 27/Mar/2008 at 11:35pm

Voltas is also going to gain immensely from the proliferation of data centers in India. A lot of MNCs and Indian companies are lining up to open their data centers in India.

In US 2-5% (depending on which study you belive in) of electricity is consumed by data centers and 40-60% of this is consumed by the cooling agents.

I relly don't know where all this 24/7 electricity supply is going to come from in India.

Posted By: shivkumar
Date Posted: 27/Mar/2008 at 12:01pm

While comparing Blue Star with Voltas one must consider the Ratan Tata factor. The RT factor has emerged as a major consideration in all Tata group companies. You never know what he has planned to buy in which part of the world.

So one must keep some cash in hand when the market sells off in panic. When they realize the synergies worked out by RT, the scrip commands a premium.

Posted By: stockwizard
Date Posted: 27/Mar/2008 at 11:29am

Originally posted by tigerz_style

If we calculate the domestic Sales taking the above factors mentioned

AC market 2007:- 20 lac units

Growth rate :- 30% pa

AC market for 2008 :- 26 lac units

Voltas AC 's sold (1 out of 6 factor) :- 433333.33

Price (Assumption = Rs 20000 taking into acc avg for both split and window) = 866 crore

I hope my calculations are correct

I beg to differ from your estimates Mr. Tiger as the estimates are slightly ambitious i feel (though i may be wrong). If we analyse the last fiscal year figures:

Total Sales --> Rs. 2400 crore

Unitary cooling divison sales --> Rs. 600 crore (25% of total)

Ac division contributes --> Rs. 420 crores (70% of Unitary Cooling)

Unit sales --> 2,37,000 units (as reported by the company) (i.e. 14% market share)

Realisaton per unit --> Rs. 17500-18000 per unit

Assuming sales of 4,33,333 units means a growth of 75% in sales which i find too ambitious. I would prefer attaching a growth figure of 35-40% to the division which is reasonably bullish as the industry is growing at 25-30%, which translates into a sales of around 3,20,000 - 3,30,000 units.

This translates into a sales of around Rs. 600 crores (i.e 18000*330000)

Voltas also announced that it will not go in for a price cut which means it will have to suffer a squeeze in its margins as the metal prices are rising sky high. They are almost double of what they were last year.

I am not too bullish on the stock for the above mentioned reasons and expect Blue Star to outperform Voltas in the short run (9-12 months).

I hope my analysis has done some value addition to the group. I would appreciate some criticisms in retrospection as it results in deepened learning for both the parties.

Posted By: stockwizard
Date Posted: 27/Mar/2008 at 11:43am

Block deal in Voltas, stk down

At 10:03 am, Voltas was quoting at Rs 169, down Rs 1.75, or 1.02%. It has touched an intraday high of Rs 172 and an intraday low of Rs 167.

There was a block deal of 10 lakh Voltas shares on NSE at Rs 171 per share, reports CNBC-TV18.

It was http://www.moneycontrol.com/india/news/buzzing-stocks/block-dealvoltas-stk-down/10/18/331854# -

Posted By: tigershark
Date Posted: 30/Mar/2008 at 9:05pm

the interest costs are negligible for a co that does large scale projects that is commendable their roce is 48%, all this suggests an efficient way of using cash.for me only the valuations are alittle on the higher side,i dont see them doing more than 6 eps for fy 08 and 8.5 forfy09 a pe of 20 for fy09.---------------------------on the other hand mkt might be ready to pay a little higher pe for their execution skills and growth rates.i dont know time will tell.

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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things

Posted By: basant
Date Posted: 30/Mar/2008 at 11:17am

http://www.theequitydesk.com/forum/forum_posts.asp?TID=%20%20href= - Voltas replaces TV 18 in The EquityDesk XI.

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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: tigerz_style
Date Posted: 31/Mar/2008 at 12:32pm

Yeh toh apne Basant jee hi honge

Jis stock ko haath laga leh woh raato raat sona ho jaata hai

Originally posted by stockwizard

Block deal in Voltas, stk down

At 10:03 am, Voltas was quoting at Rs 169, down Rs 1.75, or 1.02%. It has touched an intraday high of Rs 172 and an intraday low of Rs 167.

There was a block deal of 10 lakh Voltas shares on NSE at Rs 171 per share, reports CNBC-TV18.

It was http://www.moneycontrol.com/india/news/buzzing-stocks/block-dealvoltas-stk-down/10/18/331854# - - trading with volumes of 1,371,288 shares, compared to its five-day average of 299,536 shares, an increase of 357.80%.

Yesterday the share closed down 4.10% or Rs 7.30 at Rs 170.75.

http://www.moneycontrol.com/india/news/buzzing-stocks/block-dealvoltas-stk-down/10/18/331854 - http://www.moneycontrol.com/india/news/buzzing-stocks/block-dealvoltas-stk-down/10/18/331854

Posted By: atulbull
Date Posted: 31/Mar/2008 at 12:35pm

Voltas
Voltas, the engineering and air-conditioning major, is expected to gain immensely from the rising capital expenditure across sectors like retail, IT and entertainment, and higher infrastructure spending in India and other emerging markets such as West Asia.

Being the second largest player in the Indian organised heating, ventilation, and air conditioning (HVAC) market after Blue Star, the company is expected to reap benefits of immense opportunities in the air conditioning market, especially the non-residential segment, which is expected to almost triple to Rs 37,600 crore in the next five years.

Apart from HVAC, Voltas will also gain from the growth in the construction activities, which in turn throw up opportunities in the fledgling MEP (mechanical, electrical and plumbing) industry.

The company has established itself in its MEP business, which is growing at 40 per cent year-on-year, which had an order book of Rs 3,500 crore (international orders worth Rs 2,700 crore and Rs 800 crore worth of domestic orders) as on December 2007.

To its credit, the company has executed orders at nine out of the ten domestic airports, and is currently working on the upcoming international airport at Hyderabad.

The total investment of Rs 40,800 crore planned towards airports over the next five years reflects a huge market and hence, growth potential for players including Voltas and Blue Star.

Also, Voltas, which commands a 17 per cent share in the air-conditioner market, should benefit from increased consumer spending. All this put together indicate strong growth prospects for Voltas.

source:business standard ,date:31/03/08

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Price is what you pay.Value is what you get.

Posted By: deveshkayal
Date Posted: 31/Mar/2008 at 4:33pm

Originally posted by basant

I bought Voltas today. Stock at less then 20 times Fy09 and growing at more then 50% CAGR seems what people could say growth at (a very) reasonable price.

Now I feel like i have given back something to TED

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: basant
Date Posted: 31/Mar/2008 at 5:22pm

Yes, When you mentioned about the 10-10-10 plann I was looking deeper into it. Thanks for that initiation.

Were you preparing for exams? CA exams are held in May!

Posted By: Kuber
Date Posted: 31/Mar/2008 at 11:09pm

Originally posted by tigerz_style

Yeh toh apne Basant jee hi honge

Jis stock ko haath laga leh woh raato raat sona ho jaata hai

            Raaz ko raaz rehne do.
             well i too decided to put my money in voltas.
              & congrat... me on my first post.

Posted By: basant
Date Posted: 31/Mar/2008 at 11:37pm

Wah! Ab Kuber ji ka paisa a gaya toh stock hi nahi milega! Were you a reader all this while or found TED just today?

Posted By: India_Bull
Date Posted: 31/Mar/2008 at 5:34am

Voltas is up today in falling market ? Is everyone in TED buying? Smile

BTW when is PRIL making exit from TED XI?

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India_Bull forever Bull !
www.kapilcomedynights.com

Posted By: deveshkayal
Date Posted: 31/Mar/2008 at 9:52am

Originally posted by India_Bull

BTW when is PRIL making exit from TED XI?

After 3 years !

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: Accumulator
Date Posted: 01/Apr/2008 at 12:00pm

hi all,

this may not be the appropriate forum to post this link, but rediff today carried this piece (sourced from BS) about 7 top gems to invest in.

Titan and Voltas make the list.

http://specials.rediff.com/money/2008/apr/01mkt1.htm - http://specials.rediff.com/money/2008/apr/01mkt1.htm

TED's midas touch continues :-) and someone somewhere surely derives inspiration from TED.

cheers!

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"Invest at the point of maximum pessimism."--Sir John Templeton

Posted By: kanagala
Date Posted: 01/Apr/2008 at 12:07pm

Originally posted by Accumulator

hi all,

this may not be the appropriate forum to post this link, but rediff today carried this piece (sourced from BS) about 7 top gems to invest in.

Titan and Voltas make the list.

http://specials.rediff.com/money/2008/apr/01mkt1.htm - http://specials.rediff.com/money/2008/apr/01mkt1.htm

TED's midas touch continues :-) and someone somewhere surely derives inspiration from TED.

cheers!

TED should have discovered this few year back.

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While one person hesitates because he feels inferior, the other is busy making mistakes and becoming superior.

Posted By: Kuber
Date Posted: 01/Apr/2008 at 1:04pm

Originally posted by basant

Wah! Ab Kuber ji ka paisa a gaya toh stock hi nahi milega! Were you a reader all this while or found TED just today?

Respected Basant ji. I am reading TED for 4-5 weeks. This is best forum on the net about investments.

Posted By: Kuber
Date Posted: 01/Apr/2008 at 10:24pm

Today i bought Voltas. Star

Posted By: deveshkayal
Date Posted: 01/Apr/2008 at 11:07pm

Kuber bhai, plz introduce yourself http://www.theequitydesk.com/forum/forum_posts.asp?TID=17&PN=77 - here

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: Kuber
Date Posted: 01/Apr/2008 at 11:24pm

Deveshkayal ji aap ka hukam sar aakho pe. A tiny introduction is posted a few second back there.

Posted By: tigershark
Date Posted: 02/Apr/2008 at 9:51pm

emirates central cooling systems ltd has awarded a rs2.6 billion contract to voltas ltd for the construction of the cooling plant at the dubai int financial centre.project to be completed in 15 months.its a cooling +mep contract.

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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things

Posted By: gopal
Date Posted: 02/Apr/2008 at 10:18pm

By the way TEDies how much exposure can one take to VOLTAS as a total percentage of one's portfolio

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: basant
Date Posted: 02/Apr/2008 at 10:51pm

That is a very relative call and would depend from person to person.

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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: gopal
Date Posted: 02/Apr/2008 at 11:08pm

Originally posted by basant

That is a very relative call and would depend from person to person.

Basant ji,

Looking at my last portfolio posted on TED on 31/03/2008 ..... how much should voltas be as a percentage (how much percenatge I should make fresh purchase), so that I benefit from it but yet I do not make much sacrifice in other sector / growth areas.

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: basant
Date Posted: 02/Apr/2008 at 11:42pm

The best way is to buy a certain percentage and then wait for market declines to switch from stocks that you want to get out from and have not fallen into stocks that you would like to own and which have fallen more. It is more of a relative thing.

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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: romanov
Date Posted: 02/Apr/2008 at 12:15pm

I still haven't got in this..will wait for some more time:

MEP disappoints;Unitary Cooling is showing good Results..Basantji PAT of 472m..does that take into account sale of land at Thane Simtoos facility as well.

Posted By: basant
Date Posted: 02/Apr/2008 at 9:48am

Thame sale was around 9cr except operating profits doubled fy08 earning should be Rs 6 and for fy09 around Rs 9 per share. International Mep showed flat growth in q3 because projects and new orders got delayed otherwise company should grow top line at 35pc as a whole and bottomline by more then 50pc.

-------------
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

Posted By: deveshkayal
Date Posted: 02/Apr/2008 at 9:58am

I guess Voltas has a strong presence in the Middle-East region than Blue Star.

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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

Posted By: kulman
Date Posted: 02/Apr/2008 at 11:21am

Originally posted by deveshkayal

I guess Voltas has a strong presence in the Middle-East region than Blue Star.

Not relevant here....but talking of Middle-East, here is an interesting article: http://news.google.co.in/news/url?sa=t&ct=in/0-0&fp=47f43b6fefb9974d&ei=9WL0R_bjE5ze6APvusnEBQ&url=http%3A//www.bloomberg.com/apps/news%3Fpid%3D20601109%26sid%3DaJg.hwMzgzfk%26refer%3Dhome&cid=1147623443&usg=AFrqEzcvxvwcteSfi_ij-PJTn-PbxTlRcg - As Dubai Millionaires Multiply, Money Masks Missing Liberties

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Life can only be understood backwards—but it must be lived forwards

Posted By: stockwizard
Date Posted: 03/Apr/2008 at 12:08pm

Voltas is a strong player in the Middle-East and executes MEP work in all large scale projects there..

It is also working on the Ferrari Theme Park project in Dubai which is worth USD90mn

Posted By: atulbull
Date Posted: 03/Apr/2008 at 12:55pm

Burj Dubai marks a peak point in Voltas' global reputation

By winning a slew of prestigious project orders in Dubai and Doha, most notably the upcoming Burj Tower (the 'world's tallest building'), Voltas proves beyond all dispute that it is a force to reckon with in the global league. Just as importantly, Voltas has helped break the barrier for India's engineering services as a whole, paving the way for their entry into the global arena.

With projects successfully executed in over 30 countries, Voltas has long been India's largest exporter of Mechanical, Electrical & Public Works (MEP) projects. Today, the Company's reputation goes far beyond that statistical distinction, into the dimensions of global standards, respect and trust. Voltas has the unquestioned credibility to bid for, and win, the most demanding high-value projects, on par with leading international contractors.

The 700 m Burj Tower rises like an exclamation mark emphasizing that statement. The 162-storey edifice will be practically a vertical city, with residential apartments, hotels, boutiques and offices, arranged in a stunning spiralling taper which evokes the geometrics of desert flowers and familiar Islamic architectural motifs.

Voltas has been awarded the sub-contract for MEP jointly with Emirates Trading Agency (Dubai) and Hitachi Plant Engineering & Construction Company (Singapore). The overall sub-contract value is AED 829 million (Rs 974 crores), with Voltas' share being AED 311 million (Rs 365 crores). The tower is being developed by EMAAR Properties, Dubai, with Samsung Corporation being the main contractor.

When executing this project, Voltas will be at global centre stage, along with all the others helping build the Burj Dubai district - including 500 international consultants and more than 20,000 construction workers. The entire urban development promises to be truly futuristic in its vision, epic in its proportions, and dazzling in both design and engineering terms. By being part of this landmark development, Voltas entrenches itself as a global force to be reckoned with.

Other noteworthy orders accompany the Burj breakthrough. The Wafi Hotel and Mall is a stunning pyramid-shaped 240-room hotel in Dubai. The edifice will house nine food & beverage outlets, ball room, 7 meeting halls, spa, gym and a 242,000 sq ft retail space. Voltas has won the order for complete electro-mechanical works (HVAC, electrical, plumbing and drainage), for a contract value of AD 105 mn (Rs 120 crores), to be completed in 20 months. The main contractor is Khansaheb Civil Engineers (also associated with Voltas for the Mall of the Emirates), and the client is MKM Commercial Holdings.

Voltas has also been awarded complete electro-mechanical works (HVAC, electrical, plumbing and drainage) for the Texas A&M College of Engineering coming up in Doha, for a contract value of QR 86.5 mn (Rs 100 crores), to be completed in 18 months. The Main Contractor is Midmac Contracting Co. WLL, and the client is the Qatar Foundation

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Price is what you pay.Value is what you get.

Posted By: stockwizard
Date Posted: 04/Apr/2008 at 3:34pm

Voltas stock is battered badly today..

It is down approx 9% at 161..

Although i know that short term movements dont matter a lot at TED.. but i feel that NOW is the time to buy.. Even though it might show a price of 150 for a short while in my view.. I will start buying in parts now on.. 25% of planned investment at each 5 point fall..

Posted By: basant
Date Posted: 04/Apr/2008 at 3:50pm

Extent of agreement 100%.

Posted By: shivkumar
Date Posted: 04/Apr/2008 at 4:11pm

sold orchid at 55 per cent profit in one week and shifted entire proceeds to voltas at Rs 161

Posted By: Musketeer
Date Posted: 04/Apr/2008 at 4:18pm

Originally posted by shivkumar

sold orchid at 55 per cent profit in one week and shifted entire proceeds to voltas at Rs 161

Wah bhai wah!

55% profit in one week, cool crack.

BTW, I went thro' this thread on Voltas. The P/E comparison between Voltas & BlueStar was there.

While looking at the annual reports of both, found the book value per share for both as on March 31, 2007.

Voltas: Rs. 11.51, P/BV (@ 161) = 14

Blue Star: Rs. 23.70, P/BV (@ 400) = 16.87

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: stockwizard
Date Posted: 04/Apr/2008 at 5:15pm

Hi musketeer, how have you arrived at the Book Value of Voltas at Rs. 5.1/share

The Price/Book Value is 14.2 as per 2006-07 figures and will be around 10 for the current year in my view.

Please check your calculations.

Posted By: Musketeer
Date Posted: 04/Apr/2008 at 5:36pm

Originally posted by stockwizard

Hi musketeer, how have you arrived at the Book Value of Voltas at Rs. 5.1/share

The Price/Book Value is 14.2 as per 2006-07 figures and will be around 10 for the current year in my view.

Please check your calculations.

Yes, stockwizard, you're correct. Thanks, for spotting this. This is a good illustration of the benefits of TED, distillation of information and I'm glad I'm here alongwith others like yourself.

See, how you've converted me from a reluctant observer to an eager-to-invest in Voltas.

I've edited my previous post.

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: stockwizard
Date Posted: 04/Apr/2008 at 6:16pm

Always here to help you..

Cheers

Posted By: gopal
Date Posted: 04/Apr/2008 at 9:54pm

I increased my exposure in Voltas today

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: Vivek Sukhani
Date Posted: 04/Apr/2008 at 10:15pm

Originally posted by gopal

I increased my exposure in Voltas today

Good....

Posted By: basant
Date Posted: 04/Apr/2008 at 8:58am

The Book value for Fy09 should be closer to Rs 17 for Fy08 and Rs 24 for Fy09. This book value does not truely reflect the Rs 8-10 per share of the Hyderabad property in case it is is sold off (since it is valued at cost).

Book value is more important for capital intensive companies like Banks not so much for service oriented companies.

Posted By: Invest_in_India
Date Posted: 04/Apr/2008 at 11:42am

Added some Voltas to my portfollio yesterday.

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Cheers,
Raj

"Que sera, sera,
Whatever will be, will be;
The future's not ours to see.
Que sera, sera,
What will be, will be.
Que Sera, Sera!"

Posted By: Musketeer
Date Posted: 08/Apr/2008 at 12:57pm

Originally posted by basant

Book value is more important for capital intensive companies like Banks not so much for service oriented companies.

True, but I just wanted to highlight the comparison b/w Voltas & BlueStar on a basis other than P/E.

So, would P/BV be important for capital intensive, manufacturing industries - like Capital Goods?

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: basant
Date Posted: 08/Apr/2008 at 1:02pm

To a large extent yes. There are some businesses that come once in a decade Microsoft, Infy where people can grow revenues without cash or only by operating expenses. In such situations looking at BV becomes misleading on the other hand some companies like a 50 year old steel mill could have its assets at cost whereas the current price could be either more/less then that so book value concept comes with a caveat there.

Posted By: Musketeer
Date Posted: 08/Apr/2008 at 6:45pm

Shifted some funds from Blue Star to Voltas today.

Voltas' water-treatment business looks promising.

I've gotten comfortable with Blue Star's performance over so many quarters...don't feel like exiting it altogether.

Are there any businesses of Voltas that Blue Star doesn't operate in? And vice-versa?

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: basant
Date Posted: 08/Apr/2008 at 7:21pm

Are there any businesses of Voltas that Blue Star doesn't operate in? And vice-versa?

Large turnkey projects includes the likes of airports, SEZ cooling etc; Room airconditioners; supplying equipments - fabricated and assembled as stock and sale for mining, construction, textiles, material handling, International MEP in UAE where construction is going along like crazy are areas where Voltas has a complete edge.

In the Centralised airconditioning space Blue Star is ahead but Voltas is a close second; Blue Star has long term contracts for telecom shelter cooling; Banks etc.

Posted By: Musketeer
Date Posted: 08/Apr/2008 at 7:29pm

Originally posted by basant

Large turnkey projects includes the likes of airports, SEZ cooling etc; Room airconditioners; supplying equipments - fabricated and assembled as stock and sale for mining, construction, textiles, material handling, International MEP in UAE where construction is going along like crazy are areas where Voltas has a complete edge.

In the Centralised airconditioning space Blue Star is ahead but Voltas is a close second; Blue Star has long term contracts for telecom shelter cooling; Banks etc.

Which has higher margins: large turnkey projects/ SEZ cooling/ MEP or centralised airconditioning?

And would it be correct to say that the long-term contracts of Blue Star would simply bring in revenue with very less associated costs?

And if you can remember, what percentage of Blue Star's revenue comes from such contracts?

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: basant
Date Posted: 08/Apr/2008 at 7:41pm

Large contracts provide better RoCE because you can command rates because competition isn't there too much. SEZ cooling hasn't started full bang in India we need to have the SEZ built first present contracts are out of Middle East; Blue Star long term contracts like with HDFC bank would bring in revenues but at controlled prices as is the tendency with all long term contracts.

No idea on that but Blue Star derives 70% of revenues from centralised airconditioning.

Diversified portfolios should have both.

Posted By: Musketeer
Date Posted: 08/Apr/2008 at 7:47pm

Thank you Sir, for the prompt replies. Both look promising. I'll study both and decide on the allocation.

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Be fearful when others are greedy. Be greedy when others are fearful.

Posted By: pramodjain
Date Posted: 09/Apr/2008 at 2:05pm

Promoter holding is less than 30% in voltas. (Acording to ET Dated 09.04.08 page 14) Do the promoter don't believ in voltas growth ?

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"We simply attempt to be fearful when others are greedy, and greedy only when others are fearful."

Posted By: basant
Date Posted: 09/Apr/2008 at 2:11pm

Tatas hold less then 30% in almost all their companies.

Posted By: gopal
Date Posted: 09/Apr/2008 at 2:46pm

Originally posted by pramodjain

Promoter holding is less than 30% in voltas. (Acording to ET Dated 09.04.08 page 14) Do the promoter don't believ in voltas growth ?

Tata's are a true management led group. The Tata's in most of there companies do not hold majority holdings. Further they also do not influence day to day activities in group. Ratan Tata once said that he takes mostly half yearly reviews only and that too on the overall direction of the companies.

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: gopal
Date Posted: 09/Apr/2008 at 3:47pm

slightly increased more exposure to voltas today

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: gopal
Date Posted: 10/Apr/2008 at 12:16pm

dear all,

when is voltas coming out with its finacial year end results and earnings

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: khokhadream
Date Posted: 10/Apr/2008 at 12:37pm

Basantji,
I have one question on Votas.
Do you feel this company will be market leader for next 10 years by judging from their product quality and innovation and not from their impressive CAGR it has been showing.
Can competetion from china dent its leadership in the next 10 years.
Somehow i am not able to form conviction on this like i am able to do for TITAN.
Can you give me some perspective.

http://www.rediff.com/money/2008/apr/09china.htm

Posted By: gopal
Date Posted: 10/Apr/2008 at 12:52pm

Originally posted by khokhadream

Basantji,
I have one question on Votas.
Do you feel this company will be market leader for next 10 years by judging from their product quality and innovation and not from their impressive CAGR it has been showing.
Can competetion from china dent its leadership in the next 10 years.
Somehow i am not able to form conviction on this like i am able to do for TITAN.
Can you give me some perspective.

http://www.rediff.com/money/2008/apr/09china.htm

Dear Khokha bhai,

If I might be allowed to reply to your querry, if that is ok with Basant ji. Basant ji might be able to give you a much better reply since he has more information on stocks.

Generally speaking if you are talking of home appliance sales like fridge and a/c then haier or other chinese companies might beat both blue star & voltas. If on the other hand you are talking of cooling systems in airports, luxury hotels, malls, business complexes then the chinese are just not preferred, they are percepted as cheap and not reliable .

Even in the least developed countries the cooling systems in airports, luxury hotels, etc are by whitehouse, carrier, etc ...... no one puts up millions of dollars in a building / complex then saves a few dollars in chinese equipment to harm there reputation. After all cooling failure can lead to customer loss in commercial complexes

Haeir is there in Africa from some years but you will never find it in homes of affluent people, clubs, resorts, etc

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Women are like the stock market Coz they're irrational n can bankrupt u if u're not careful

Posted By: basant
Date Posted: 10/Apr/2008 at 1:08pm

WHen you give contracts you look at past record/performance/completion etc. Cost is an important but secondary factor.

In white goods chinese have been unable to pierce the market to any extent. They are not even in the top 5 brands in India!

WOuld you buy a chinese AC because it is Rs 1500 cheaper and run the risk of spending a hot summer evening on the verandah

Voltas has a 20% market share in the Ac market and expects to increase it to 25% in Fy09!LG is number 1 withg closer to 40%. In the overall AC segment Voltas is the number 1 company in India.

Posted By: kulman
Date Posted: 11/Apr/2008 at 12:28pm

Originally posted by basant

WOuld you buy a chinese AC because it is Rs 1500 cheaper and run the risk of spending a hot summer evening on the verandah

I hope you aren't talking about Koryo, are you?

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Life can only be understood backwards—but it must be lived forwards

Posted By: basant
Date Posted: 11/Apr/2008 at 8:47am

Ha! Ha! Ha! But with Koryo you get a cool breeze that starts getting cooler multifold as time passes!

Posted By: CHINKI
Date Posted: 04/May/2008 at 9:45am

Admin & Basantji, why RSS icon is not present on this thread??

Surprisingly, the moment I posted this message, it started appearing!! How is that??

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TOUGH TIMES NEVER LAST, BUT TOUGH PEOPLE DO

Posted By: kanagala
Date Posted: 03/Jun/2008 at 11:48am

I have purchased some shares of Voltas around 137. Any chances of price going to 120.

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While one person hesitates because he feels inferior, the other is busy making mistakes and becoming superior.

Posted By: stockwizard
Date Posted: 05/Jun/2008 at 2:41pm

Hi kanagala,

I believe more in "long term" and "value" investing.. It doesn't matter to me if the price goes to 100 or even 80 for that matter.. In my view, value buying should pick-up once the stock reaches 120-125 levels.. I have also started investing since the stock broke a psychological barrier of 150..

I would suggest you to acquire the stock in parts.. I took an exposure of about 50% of my target investment at 145.. i would invest an equivalent amount if the stock would drop below 120.. that would average the acquisition price.. and once that is through i will not look at it for minimum one year.. however, i will follow the stock updates and visit this thread regualarly to discuss on its new developments..

This style of investing is difficult to practise but, in my view, it is superior to all other styles of investment and would vouch for it always.. Even if the price moves up from here, i will only stand to gain from it..

Posted By: master
Date Posted: 12/Jun/2008 at 10:20am

From an interview of Mr. Miyajiwala, CFO, Voltas & Mr. B.N. Garudachar, General Manager

Q: Are you on track to achieve your 10 by 10 plan?

A: We are on track to achieve our plan. Our target is to achieve sales of Rs100bn, EBIT margin of 10% by 2010- 11. Out of this we expect sales of Rs75bn to come from organic growth and the remaining Rs25bn should come via the inorganic route.

Q: How will you achieve this growth organically?

A: We have an order book of Rs46bn. Out of which Rs38bn is international and Rs8bn is domestic. Our international book has a turnaround time of 24 months and for domestic it is 6-9months. This will give you very good idea about how fast our MEP segment should grow. We expect our 2nd division to grow by 18% to 20% and unitary division to grow at over 30%.

Q: Have you identified any prospective company to buy, what line of business would this be in and what would the quantum of this deal be?

A: We are still scouting for a company. We are predominantly looking at a company operating in the MEP space. Water management would be an option. About the quantum, all we can say is that it won’t be a very large buyout. On the funding side we have Rs2.2bn

in investments in mutual funds and another Rs800m in cash.

Q: Talking about the MEP division, why did we loose the Delhi airport contract?

A: We lost the Delhi airport contract to ETA Dubai. They have a separate division in India, but this contract was won by the international division. The reason we lost this contract was that ETA had put in a very low bid, and we do not want to put in bids below a certain

level of margin.

Posted By: kulman
Date Posted: 17/Jun/2008 at 7:44pm

Voltas Ltd has http://www.bseindia.com/qresann/news.asp?newsid=%7BE5906875-3719-472D-8381-78C59C2884E1%7D&param1=1 - purchased from Fedders International Air-conditioning Pvt Ltd (FIACPL), a subsidiary of Fedders Corporation, USA 1,38,21,000 equity shares of Rs 10 each of Universal Comfort Products Pvt Ltd (UCPL), a 50:50 joint venture company between Voltas and FIACPL, representing their 50% shareholding in UCPL, for a consideration of Rs 312.04 lakhs.

Accordingly, UCPL becomes a wholly owned subsidiary of Voltas Ltd effective June 17, 2008. UCPL is engaged in the business of manufacturing Window Room airconditioners and Split air conditioners.

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Life can only be understood backwards—but it must be lived forwards

Posted By: tigershark
Date Posted: 17/Jun/2008 at 9:41pm

a very small aqiusition 3.12 crs

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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things

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