All posts by : Khyati Shah

Vikas Ecotech Ltd

Speciality Chemicals
FV – Rs 1; 52wks H/L – 10.55/0.96; TTQ – 13.47 Lacs; CMP – Rs 10.5 (As On August 13, 2020);                     

            Market Cap – Rs 295 Crs

Standalone Financials and Valuations (Amt in Rs Crs unless specified)

• The demerger of ‘Recycled and Trading Compounds Division’ of the Company was successfully completed during the year under review and the Shareholders of the Company were allotted shares in ratio of 1:1 of Vikas Multicorp Ltd.
• The Company completed commercial scale production trials and the added capacity of Specialty Chemicals plant at Rajasthan is ready for utilization in anticipation of enhanced production and sales for the next fiscal year as well.
• The Company successfully designed & tried the new range of Eco-friendly Calcium Zinc Heat Stabilizer for PVC across various application areas like the PVC Rigid & Soft PVC Applications which have been included in the list with this new addition to the product mix offered by VEL. VEL is ready to start commercial scale production in anticipation of the huge demand that will be created with the implementation of the ban on Toxic Stabilizers.
• As anticipated, targeted & projected for the FDA approved – Food Contact Safe Organotin Stabilizers, for which Vikas Ecotech is the only producer in India and one of the very few across the globe, the Company has successfully initiated the process for tapping the potential embedded in the largest market place for the Organotin Stabilizers the U.S.A. & has been received well by the market due to its consistent quality of the materials.

Overview:

• Vikas Ecotech is an emerging player in the global arena of the high end specialty chemicals players.
• They cater to products ranging from agriculture to automotives, cables to electricals, hygiene to healthcare, polymers to packaging, textiles to footwear as per industry needs.
• The Company operates under single segment which is manufacturing and trading of speciality additives including agrochemicals and rubber-plastic and polymer compounds. Product wise performance of the Company is discussed here under :

1. Speciality Additives – The Company is a leading manufacturer of specialty additives as we derive our competitive edge from our innovative products with real-world applications. There are 5 products in this range.

Organotin or Methyl Tin Mercaptide (MTM) continues to be the focus of the company’s  specialty additives segment and they  are India’s only indigenous manufacturer of organotin among the eight global manufacturers of the additive. USA is the world’s largest consumer of this product.

2. Polymer Compounds – The Company is also a leading manufacturer of specialty rubber-plastic and polymer compounds. They have 3 products in this category.

Management:

• Gyan Prakash Govil – Chairman
• Vikas Garg – MD
• Amit Dhuria – CFO

Shareholding Pattern:

Major Holdings:

Share Price Trend:

Share Price Snapshot :

Standalone Financials: (Rs. Crs unless specified)

    Great Eastern Shipping Company Ltd

Shipping
FV – Rs 10; 52wks H/L – 369.35/168.95; TTQ – 12 K; CMP – Rs 270 (As On August 5, 2020);                     

            Market Cap – Rs 3968 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Debt to Equity – 0.7

ROE – 3.04%

Market Cap/Sales – 1

• On May 30, the Mumbai-based company’s board approved a proposal to incorporate a wholly owned subsidiary – Great Eastern Services Ltd. (https://www.thehindubusinessline.com/economy/logistics/great-eastern-shipping-ventures-into-third-party-ship-management/article31786445.ece#)
• During the year, the company declared and paid first interim dividend of Rs. 5.40 per share. Subsequent to the end of the year, they declared second interim dividend of Rs. 2.70 per share. (total dividend Rs. 8.10 per sahre)
• During the year the company announced buyback of its equity shares from the open market through stock exchanges at a price not exceeding Rs. 306 per share for an aggregate amount not exceeding Rs. 100 crore. . The Company bought back 3810581 equity shares of Rs. 10 each for an aggregate amount of Rs. 99.94 crores. The highest, lowest and average market price at which the shares were bought back was Rs. 305, Rs. 221 and Rs. 261.60 per share respectively.
• The company achieved an operational efficiency of 99.5% on the shipping fleet.

Overview:

• G E Shipping is India’s largest private sector shipping service provider enjoying a formidable presence in the international maritime industry. The shipping business operates under two main businesses: dry bulk carriers and tankers.
• Backed by an enviable clientele comprising industry leaders, international oil companies and governments who vouch for its services, the division has earned the status of being the most preferred shipping service provider.
• With a pulse on the global market and a thorough understanding of the ever-evolving market needs, the division is well-equipped to anticipate the demands of its clients and to deliver on its commitments, successfully and satisfactorily.
• As at 31st March 2020, the fleet size stood at 46 ships aggregating to 3.70 million dwt, with an average age of 12.20 years. During the financial year, the company delivered to buyers a Very Large Gas Carrier (VLGC) which it had contracted to sell in FY 2018-19, and also sold and delivered to the buyers a Suezmax crude carrier.

Source : Investor Presentation

Shipping Fleet Breakup:

Source : Investor presentation

Management:

• K. M Sheth – Chairman
• G. Shivakumar – CFO

Shareholding Pattern:

Major Holdings:

Share Price Trend:

Share Price Snapshot:

Source : Investor Presentation

Financial Trend: (Rs. Crs unless specified)

Source : Annual Report

Segment Revenue:

Source : Company Results

Peer Comparison:

DCM Shriram Ltd

Diversified
FV – Rs 2; 52wks H/L – 537.75/175.8; TTQ – 5133; CMP – Rs 320 (As On July 15, 2020);                     

            Market Cap – Rs 5265 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Debt to Equity – 0.5

ROE – 18%

Market Cap/Sales – 0.7

 The schedule for implementation of capacity expansion at Bharuch for Caustic Soda Plant by 700 TPD (along with 120 MW Captive Power plant and Flaker capacity expansion of 500 TPD) at an investment of Rs.1070 crs is being realigned taking into account the impact of Covid-19.

Overview:

• DCM Shriram Ltd is a spin-off from the trifurcation of the reputed erstwhile DCM Group.
• The company’s business portfolio consists of Chloro-Vinyl Business, Agri-Rural Business and other Value-Added Businesses.
• It is amongst one of the most cost efficient producers of products and services in all its businesses and has been continuously striving for operational efficiency.
• DCM Shriram, across its various businesses is strategically diversified yet operationally integrated company.
• Some of the businesses feed others, thereby lowering operation costs and making DCM Shriram a highly competitive player.
• The continued focus of the Govt. on agriculture & infrastructure is expected to fuel growth of the agricultural & PVC industry in India.

Businesses:

Chloro-Vinyl Businesses:

1. Chlor- Alkali – DCM Shriram’s Chlor-Alkali (Chemicals) buusiness comprises Caustic Soda (Lye and flakes), Chlorine and associated chemicals including Hydrochloric acid, Stable Bleaching powder, Aluminium Chloride, Compressed Hydrogen and Sodium Hypochlorite. The Company has two manufacturing facilities located at Kota (Rajasthan) and Bharuch (Gujarat) with full coal based captive power. The company’s caustic soda capacity at Bharuch is 1345 TPD and at Kota is 498 TPD.
2. Plastics Business: A highly integrated business, located at the Kota plant, it involves manufacturing of PVC resins and Calcium Carbide with captive production of Acetylene, Chlorine and Coal based power. Company’s raw carbide capacity stands at 340 TPD and PVC capacity stands at 220 TPD.

Sugar:

capacity of 38,000 TCD. These units have a total power cogeneration capacity of 141 MW and are also supported by 350 KLD of Distillery capacity and a 700 TPD refinery.

Agri-Input Businesses:

Shriram Farm Solutions

Bioseed

Fertiliser

Other Businesses:

Fenesta Building Systems.

Cement

PVC Compounding

Hariyali Kissan Bazaar

Revenue of Sugar business was up by 7% with higher ethanol volumes as well as better realization of Sugar.

Management:

• Ajay S. Shriram – Chairman & MD
• Vikram S. Shriram – Vice Chairman & MD
• Amit Agarwal – CFO

Share Holding Pattern:

Major Holdings:

Share Price Trend:

Share Price Snapshot:

Financials:

Source – Annual Report

The overall operating performance of the Company was stable during the year, with businesses like Sugar, Shriram Farm Solutions, Fenesta and Cement registering growth led by better product prices and volumes. Chlor-Alkali business witnessed a sharp decline in product prices as domestic caustic prices aligned with the international prices.

Overview:

• Max Financial Services Limited (MFS), a part of the USD 3.2 bn Max Group, is the holding company for Max Life, India’s largest non-bank, private life insurance company.
• Max Financial Services owns and actively manages a majority stake in Max Life Insurance Company Limited, making it India’s first listed company focused exclusively on life insurance. Max Life is a joint venture with Mitsui Sumitomo Insurance (stake ~25%), a Japan-headquartered global leader in life insurance.
• Max Life has an extensive presence across India through its own offices and distribution partners and is the 4th largest private Life Insurance player in the country.

Management :

 Financials (Consolidated) :

Source : Capitaline

Recent Updates:

Axis Bank and Max Financial Services Deal Background

• Axis Bank Ltd (Axis Bank) and Max Financial Services Limited (MFS) announced the signing of definitive agreements to become joint venture partners in Max Life Insurance Company Limited (MAXL).
• Axis Bank will hold 30% stake in Max Life post transaction closure.
• The development will result in a mutually beneficial and enduring relationship between Axis Bank and Max Life and bring the stability of a long term partnership to India’s fourth largest private life insurance franchise.
• The joint venture arrangement will significantly improve Max Life’s competitive position vis a vis its competitors, including the other large bank owned private life insurers.

Deal

• Max Financial Services presently holds a 72.5% stake in Max Life and Mitsui Sumitomo Insurance (MSI) owns 25.5% stake. Axis Bank also has a minor stake in the Max life.
• The aforesaid transaction with Axis Bank follows the ongoing swapping by MSI of 20.6% stake that it holds in Max Life with a 21.9% stake in MFS.
• MFS also plans to purchase MSI’s balance stake in Max Life.
• Post the swap transaction, Axis Bank will buy out 29% of MLI from MFS (currently holds ~1% in Max Life).
• Post completion of the series of transactions, Max Life will become a 70:30 joint-venture between Max Financial Services and Axis Bank.
• The proposed transactions are subject to approval of requisite corporate and regulatory authorities (including IRDAI, RBI and CCI). Company expects deal to be completed within one year.
• Valuation of stake will be dependent on the tax adj. BV of MAXL (Dec-19: Rs 56bn, 29% at Rs 16bn) as on transaction date. Axis Bank indicated that they will buy 55.6 crore shares of Max Life for a total consideration (estimated) of Rs. 1,592 crore, but the final amount will depend on exact pricing at the time of transaction. (*Only guided).

Mitsui Sumitomo swap indicative process:

• The construct of the transaction is such that Mitsui Sumitomo (MSI) will first swap part of its shareholding in MAXL for a shareholding in the holdco, i.e., Max Financial Services (MFS).
• As a result of this swap, MFS will end up owning ~94% stake in MLI and MSI will still hold ~5% in MLI which, at a later stage, would be bought out by MFS.
• Post the swap transaction, Axis Bank will buy out 29% of MLI from MFS (currently holds 1% in Max Life). Finally, MAXL would be reverse merged with MFS, effectively becoming a listed entity.
• The proposed transaction structure awaits regulatory approvals.

Share Price Trend:

Max Group

2016 – Demerger/split of Max India Ltd into three entities –

1. Max Financial Service Ltd with the insurance business,
2. Max India Ltd with the healthcare and allied businesses and
3. Max-Ventures and Industries Ltd with specialty packaging film business.

• Max Financial Services (MFS)
  • After the split, Max India was renamed as ‘Max Financial Services Ltd (MFS) and solely focus on the group’s flagship life insurance activity, through 72.1% (then in 2016) in Max Life, making it the first Indian listed company solely focused on life insurance.

• Max India Ltd
  • The second vertical “Max India Ltd” (MIL) continued to manage investment in the high‐potential health and allied business comprised of Max Healthcare, Max Bupa, Antara Senior Living and supported by a corporate management service team.

• Max Ventures & Industries Ltd
  • The third vertical will be named Max-Ventures and Industries Ltd (MVIL), which will house the investment in the group’s manufacturing subsidiary Max Specialty Films ‐ one of the leaders in the specialty packaging films busines

NLC India Ltd
Electric Utilities
FV – Rs 10; 52wks H/L –72.5/35.05; TTQ – 2.04 Lacs; CMP – Rs 46 (As On July 6, 2020);                                  

Market Cap – Rs 6489 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Valuation Parameters:

1. Debt to Equity – 1.93
2. ROE % – 11
3. Market Cap/Sales – 0.6

NLC India and Coal India executed a Joint Venture Agreement on 3 July 2020 for formation of a Joint Venture Company (JVC) to develop Solar and Thermal Power assets to the tune of 5000 MW on pan India basis. (https://www.business-standard.com/article/news-cm/nlc-india-and-coal-india-to-form-50-50-jv-to-develop-solar-and-thermal-power-assets-120070400319_1.html)

The company on Friday (5 July) said it allotted CPs worth Rs 200 crore to State Bank of India, while CPs worth Rs 200 crore and Rs 100 crore were allotted to Nippon India Money Market Fund and Nippon India Low Duration Fund, respectively. (https://www.business-standard.com/article/news-cm/nlc-india-firms-up-on-raising-rs-500-cr-via-commercial-papers-120070300802_1.html)

Key Updates:

• Solar Power Projects to the tune of 403.56 MW have been commissioned during the year.
• Achievement of Thermal Plant Load Factor (PLF) of 71.95 % against the National Average of 61.07%.
• Buy-back of equity shares comprising 9.29% of the paid-up capital at a price of 88 per share.
• Synchronisation of Unit 1 – 500 MW of Neyveli New Thermal Power Station (NNTPS) in March 2019, the first of its kind for this capacity in Lignite based Thermal plants in India.
• Power Trading License (Category I) for trading of Power has been granted by CERC. Power sold to DISCOMs at a competitive tariff.

During the year the company has achieved the following

Overview:

• The Company is presently operating lignite mines with a total installed capacity of 30.60 MTPA and considering the other Projects under formulation / implementation, the total lignite mining capacity will be increased to 62.15 MTPA by the year 2025.
• Regarding coal mining, as stated earlier Talabira II & III coal mine project of capacity 20.0 MTPA in the State of Odisha has been allocated in favour of the Company while the Pachwara South Coal Block with a capacity of 11.0 MTPA has been allotted to NUPPL, the Subsidiary Company.
• The above two projects aggregate to a coal mining capacity of 31.0 MTPA at the end of the year 2025.
• The Company is presently operating thermal power plants with an aggregate capacity of 3140 MW, wind power of 51 MW & solar power plants of 743.56 MW and thus aggregating to a total installed capacity of 3934.56 MW.
• Taking into consideration the power projects under formulation / implementation and also the envisaged acquisition of power assets, the Company is poised to grow to 21 GW power generating Company by the year 2025 including Subsidiaries.

The company is operating following Mines and Thermal Power Stations:

Mines :-

1. Mine–I – This mine, located on the northern part of Neyveli Township in Tamil Nadu, is spread over an area of 26.69 sq km. This mine has reserve of 365 million tonnes and has a production capacity 10.5 million tonnes of lignite per annum. This mine feeds lignite to its 600 MW capacity of First Thermal Power Station and 420 MW Thermal Power Station (expanded).
2. Mine–IA – This mine is spread over an area of 11.6 sq km. The mine has a reserve of 120 million tonnes with a production capacity of 3 million tonnes of lignite per annum. It caters to the need of 250 MW independent power project, in addition to the requirement of NLC’s Thermal Power Stations.
3. Mine–II – This mine was sanctioned by the Government of India in February 1978 with a lignite production capacity of 4.7 mtpa which was increased to 10.5 mpta in 1983. This mine is spread over an area 27.74 sq km and has a reserve of 390 million tonnes.

Thermal Power stations :-

1. (TPS)TPS–I –– This is South Asia’s first and only lignite–fired thermal power station. This plant was commissioned with one unit of 50 MW and currently possess six units of 50 MW each and three units of 100 MW each. The company has set up additional capacity of 420 MW. It has total generating capacity of 1020 MW
2. TPS– II – This power plant was constructed in two stages in 630 MW and 840 MW. This power plant has a generating capacity of 1470 MW consists of seven units of 210 MW each.

Management:

• Mr. Rakesh Kumar – Chairman & MD

Shareholding Pattern:

Share Price Trend:

Price History:

Segment Revenue: (Rs. Crs)

Source – Audited Results

Financials  (Consoildated Financials in Rs Crs  unless specified):

Source – Annual Report

Risks:

• Delay in realisation of Power dues
• Power Surrender by the Beneficiaries Denial of agreed tariff due to delay in commissioning of project within the control period prescribed by Regulators .
• Competition consequent to de-regulation in Indian Power Sector.
• Stringent norms prescribed by RegulatoryAuthority affecting power tariff Cost and time over run of projects under execution Higher cost of lignite mining

Cochin Shipyard

Shipping

FV – Rs 10; 52wks H/L – 491.15/209; TTQ – 0.76 Lacs; CMP – Rs 318.8 (As On June 26, 2020);                  

      Market Cap – Rs 4194 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Board of Directors:

Madhu S Nair: Chairman & Managing Director

Shri D Paul Ranjan: Director (Finance) and Chief Financial Officer

Shareholding Pattern:

Price History:

Peer Comparison:

(All figures inRs Cr. unless specified)

Buyback:

On October 31, 2018, The board announced a buyback of Rs. 200 Cr at Rs 455 per share.

The company decided to buyback 43,95,610 shares which would add up to 6.41% of the total equity.

Buyback Details:

All figures inRs Cr. unless specified

Monte Carlo Fashions Ltd

Other Apparels & Accessories

FV – Rs 10; 52wks H/L – 317/128; TTQ – 14 K; CMP – Rs 170 (As On June 24, 2020);                     

            Market Cap – Rs 351 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Debt to Equity – 1

ROE – 12%

Market Cap/Sales – 0.5

Monte Carlo Fashions Limited announces a new range of products in the Medical Textile Range i.e. Face Masks (3 PLY Masks , KN9S Mask and N95 Mask) and Personal Protective Equipment (PPE Kit), keeping in view the requirements of medical workers and demand of consumers due to Novel Corona virus (COVID19).  https://www.bseindia.com/xml-data/corpfiling/AttachHis/5b9f09bc-512d-4467-b26c-a4032ae7ff94.pdf

Company had done buy back of Rs. 55 Crs (Rs.550 per share)in FY19 to reward shareholders through tender offer. Promoters have not participated in the buy back.

Overview:

• Monte Carlo Fashions Ltd, established in 1984, is recognized as ‘Superbrand’ for woollen knitted apparels by Consumer Superbrands India since 2004. Under the umbrella brand of ‘Monte Carlo’, Company has a comprehensive product portfolio across woolen, cotton & cotton blended, home furnishing and kids segments.
• The Company has various sub-brands under the Umbrella Brand ‘Monte Carlo.
• The company has 3 manufacturing facilities in Ludhiana, Punjab – 1 for woolen apparels & 2 for cotton apparels.
• The manufacturing facilities include facilities for product development, design studio and sampling infrastructure.
• The company has recently started in-house manufacturing of cotton t-shirts and thermals.
• The home furnishing products are outsourced from a network of job work entities.
• The company has wide-spread retail presence across India through a judicious mix of EBOs, MBOs and national chain stores located in 22 states & 1 union territory

Source – Company Presentation

Management:

• Jawaharlal Oswal – Chairman &MD
• Raj Kapoor Sharma – CFO

Shareholding Pattern:

Major Holdings:

Share Price Trend:

Price Snapshot:

Consolidated Financials: (Rs. Crs unless specified)

 The major reasons for decrease in Net profit of the company is due to increase in advertisement costs and unspent amount of CSR for the previous years 2016-17, 2017-18 and current year 2018-19 has been paid during the year.

Bharat Heavy Electricals Ltd
Housing Finance
FV – Rs 2; 52wks H/L –75.5/19.2; TTQ – 1.7 Crores; CMP – Rs 31 (As On June 18, 2020);                                 

Market Cap – Rs 10847 Crs

Consolidated Financials and Valuations (Amt in Rs Crs unless specified)

Financials:

Price History:

On 28 September 2017, there was a bonus issue of 1:2.

Dividend Declared:

Notifications:

BHEL commissions 270 MW Thermal power plant in Telanqa. (https://www.bseindia.com/xml-data/corpfiling/AttachHis/ee536ab9-201c-42f7-92a1-3dd4e403953e.pdf)

BHEL invites Global OEMs to Leverage Its Facilities and Capabilities to ‘Make in India’ (https://www.bseindia.com/xml-data/corpfiling/AttachHis/24f33bd2-22f8-4f1e-b44b-52282c25b4ba.pdf)

BHEL has signed a MOU with Energy Efficiency Services Ltd (EESL) for electric mobility on various highways pan India. (https://www.bseindia.com/xml-data/corpfiling/AttachHis/9467a61f-ed43-44dc-b336-352fc2aa0b0b.pdf)

BHEL launches multi-dimensional Transformation Strategy; Focuses on converting challenges of rapidly changing business environment into opportunities (https://www.bseindia.com/xml-data/corpfiling/AttachHis/575b8d43-f2ca-4f34-8433-d0c584ce6a72.pdf)

BHEL commissions 14 Pumping Units of Kaleshwaram Lift Irrigation Scheme in Telangana in a record period of six months (https://www.bseindia.com/xml-data/corpfiling/AttachHis/7347536b-c73a-4fbd-9e60-9b35242f3934.pdf)

BHEL wins order for R&M and Upratinq of Chilla HEP (https://www.bseindia.com/xml-data/corpfiling/AttachHis/ccb78a3e-2af2-4eb6-ba2a-dd8ebf9db400.pdf)

BHEL commissions 800 MW supercritical thermal power plant in Gujarat (https://www.bseindia.com/xml-data/corpfiling/AttachHis/54f32010-c173-47b6-9056-27e02822b416.pdf)

BHEL Net Profit up by 51%; 100% Dividend Declared Renewed Thrust on Diversification to Drive Next Wave of Growth (https://www.bseindia.com/xml-data/corpfiling/AttachHis/3b017cb3-b33e-4ad1-af0f-16b6eb68c4fe.pdf)

BHEL wins Rs.450 Crore order for Emission Control System (https://www.bseindia.com/xml-data/corpfiling/AttachHis/567fc503-8bb3-4a9c-991b-d3bb5048a604.pdf)

BHEL has invested Rs 5.0 Cr (five crores only) as equity in NEELANCHAL ISPAT NIGAM LIMITED (NINL) (https://www.bseindia.com/xml-data/corpfiling/AttachHis/9de3d3df-dcff-4339-8c94-016fb03f75e8.pdf)