About Company I: Honda
Siel Power Products Limited (HSPP), is a subsidiary of Honda Motor Co. Japan
and was incorporated on 19th Sept, 1985. Ever since, it has been the undisputed
leader in the power products industry, manufacturing and marketing a range of
Portable Generators, Water Pumps and General Purpose Engine at its state-of-art
manufacturing facilities at Greater Noida. It is also engaged in the marketing
of Lawnmower, Brush Cutter, Long tailed outboard motors and Power Tiller.
HSPP benefits from the rich experience of Honda Motor Co.,
Japan the second largest engine manufacturer in the world, because of their
strong emphasis on R&D and in-house technical innovation. The Ultra Silent,
Self start range of India's first "Pure Sine Wave EU series
Generator" and the highly fuel efficient range of OHV Engines are some of
the products which exemplify Honda's pursuit of technological excellence.
In 2013, HSPP started exporting Generating Sets to Developed
Countries – USA, Canada & Japan,20% of the total production exported in
2013-14, products are available in 46 countries across the globe through
authorized Sales & Service Distribution network. Achieved export turnover
of US$ 27.00 million (estimated) in 2013-14 – which WAS 100 % growth over
previous fiscal year.
Manufaturing uit: Company has factory at Greater Noida
Financials
Company has been paying good dividend for last 5 years.
Crores
|
2015
|
2014
|
2013
|
2012
|
2011
|
Revenue
|
630.73
|
541.35
|
515.55
|
504.83
|
412.91
|
Other Income
|
7.09
|
4.57
|
6.97
|
9.62
|
7.7
|
Total Income
|
637.82
|
545.92
|
522.52
|
514.45
|
420.61
|
Expenditure
|
-557.57
|
-499.45
|
-477.51
|
-431.41
|
-367.85
|
Interest
|
--
|
--
|
--
|
--
|
-0.1
|
PBDT
|
80.25
|
46.47
|
45.01
|
83.04
|
52.66
|
Depreciation
|
-21.31
|
-17.54
|
-13.75
|
-10.3
|
-8.21
|
PBT
|
58.94
|
28.93
|
31.26
|
72.74
|
44.45
|
Tax
|
-20.32
|
-10.15
|
-10.66
|
-21.06
|
-14.79
|
Net Profit
|
38.62
|
18.78
|
20.6
|
51.68
|
29.66
|
Equity
|
10.14
|
10.14
|
10.14
|
10.14
|
10.14
|
EPS
|
38.08
|
18.52
|
20.31
|
50.95
|
29.24
|
CEPS
|
59.1
|
35.82
|
33.88
|
61.12
|
37.35
|
OPM %
|
12.72
|
8.58
|
8.73
|
16.45
|
12.78
|
NPM %
|
6.12
|
3.47
|
4
|
10.24
|
7.18
|
Dividend
|
60%
|
40%
|
40%
|
90%
|
75%
|
Extraordinary growth of export is the game changer for this
company.in year 2014-15 the export growth was 75% which was 43% of total
revenue domestic sale has shown sluggishness This year overall generator
business was impacted due to discontinuation of Kerosene run Gensets in the
wake of introduction of revised CPCB (Central Pollution Control Board) norms
for Noise and the Emissions, effective 6 of August, 2014. Improved power
scenario, particularly in Southern parts of the country further reduced the demand.
Going forward Major driver for company is growth in export
due to launch of new products, increase in demand for other agriculture
products.
Company is debt free consistent dividend paying this year
Company has declared dividend of 65%. Honda holds approx. 67% share and the delisting
possibility can’t be ruled out by Japanese parents. If company is able to
maintain export growth it can achieve revenue of Rs800 crores in 2015-16 with
Net profit margin of 7% it can result in profit of 56 crores resulting in EPS
of 56 with forward PE multiple of 35 stock has potential to touch Rs 2000 in a
year and in future years the performance can only improve.
Long term portfolio investor may buy this Japanese MNC at
CMP of Rs 1365.
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