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Monday, July 20, 2015

Garware Wall Ropes : Buy at CMP of Rs 255-260 1 year target Rs 400




Garware-Wall Ropes Limited(GWRL), is one of India's leading players in technical textiles with a widespread global presence. Deploying its expertise in engineering of polymer sand its in-depth knowledge of customer needs, GWL provides application-focused solutions for various sectors including deep-sea fishing, aquaculture, shipping, agriculture, sports, infrastructure, defence and transportation. Company has three large integrated manufacturing facilities in Pune, Wai and Silvassa, where a wide variety of products are produced, including ropes, nets and aquaculture cages for capturing and breeding fish; nets for sports such as tennis and soccer; insect and shade nets for high-value agriculture; coated fabrics for covers, tarps, tents, etc; and geo synthetic solutions for water management, waste management and erosion control applications.
 Company  has secured customers across all continents in over75 countries. End-users include fishermen, shipping companies, oil drillers, agriculturists  , packers, transporters, construction companies ,municipalities, government organisations, clubs, universities and manufacturing plants.
Financials:
in Cr.)
2015
2014
2013
2012
2011
Revenue
784.25
687.65
603.73
580.49
503.67
Other Income
1.71
0.88
1.36
1.12
0
Total Income
785.96
688.53
605.09
581.6
503.67
Expenditure
-702.81
-618.94
-540.89
-520.35
-448.7
Interest
-10.25
-16.12
-14.48
-13.18
-8.92
PBDT
72.9
53.47
49.72
48.07
46.05
Depreciation
-12.39
-14.39
-16.32
-16.02
-14.84
PBT
60.51
39.08
33.4
32.05
31.21
Tax
-17.46
-12.42
-8.73
-8.05
-6.78
Net Profit
43.06
26.66
24.67
24.01
24.43
Equity
21.88
21.97
23.71
23.71
23.71
EPS
19.68
11.4
10.41
10.13
10.31
CEPS
25.34
18.69
17.29
16.88
16.57
OPM %
10.6
10.12
10.63
10.55
10.91
NPM %
5.49
3.88
4.09
4.14
4.85

 

Company has come up with excellent results in FY14-15 with EPS of Rs 19.68 and declared dividend of Rs3.00. falling raw material cost due to drop in crude prices the margins have also already gone up by 1.6 basis and it may further improve. Going forward I expect GWRL to achieve growth of 15% in 2015-16 and expected to  achieve revenue of approx. 900 crores with NPM of 5.5-6% the  Net profit of Rs50-52 crores can be easily achieved resulting in EPS Of Rs 23-25  at PE multiple of 15 the stock could touch Rs 350 in 1 year.

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