About Company: SNL
Bearing is subsidiary of NRB Bearing which was acquired by NRB .
SNLB operates in the Anti friction bearing industry which is
segmented into ball bearings androller bearings (Tapered, Cylindrical, Needle,
Spherical, Thrust and other special application bearings).The major user
industries of anti friction bearings are auto mobiles, general engineering,
railways, electrical equipment etc. year.
SNLB operates in the
following market segments:
1. Automotive OEM 2. After Market 3. Exports
The automotive OEMs constitute over 90% of the sales. The
demand for roller bearings has grown by 8% during the last year reflecting
overall sluggishness in industrial activity. The automotive industry is the
largest consumer of bearing products. In FY 2014-15 sales of the overall Indian
automobile sector have shown a moderate growth of 4% compared to the negative
growth of the previous year.. As Indian industry develops, demand for bearings
is expected to grow both in quantitative as well as qualitative terms towards bearing
solutions that are efficient and support productivity.
SNL has achieved sales growth. Profit before tax(PBT) has
increased by 36% from Rs.496.05 lakhs (Previous year) to Rs.673.47 lakhs on
account of higher volumes and improved cost competitiveness. SNL will further
capitalize on growth opportunities during the current year and enhance
profitability and widen its ability to serve customers with emphasis on
improving quality and productivity.
company has enhanced capacity at Ranchi and is now in a
position to offer a more comprehensive product portfolio to customers.
Financial
Performance.
201
|
2015
|
2014
|
2013
|
2012
|
2011
|
Revenue
|
26.48
|
23.02
|
23
|
20.53
|
17.62
|
Other Income
|
0.33
|
0.48
|
0.07
|
0.03
|
--
|
Total Income
|
26.81
|
23.5
|
23.07
|
20.56
|
17.62
|
Expenditure
|
-18.92
|
-17.46
|
-16.21
|
-13.64
|
-12.03
|
Interest
|
-0.56
|
-0.65
|
-0.38
|
-0.24
|
-0.31
|
PBDT
|
7.33
|
5.39
|
6.48
|
6.68
|
5.28
|
Depreciation
|
-0.6
|
-0.43
|
-0.37
|
-0.44
|
-0.47
|
PBT
|
6.73
|
4.96
|
6.11
|
6.24
|
4.81
|
Tax
|
-2.19
|
-1.57
|
-2.15
|
-1.77
|
-0.99
|
Net Profit
|
4.54
|
3.39
|
3.96
|
4.47
|
3.82
|
Equity
|
3.61
|
3.61
|
3.61
|
3.61
|
3.61
|
EPS
|
12.37
|
8.9
|
10.29
|
11.12
|
8.93
|
CEPS
|
14.24
|
10.58
|
11.99
|
13.59
|
11.88
|
OPM %
|
29.8
|
26.24
|
29.83
|
33.71
|
31.73
|
NPM %
|
17.15
|
14.73
|
17.22
|
21.77
|
21.68
|
Valuation: In
Q—1-2015, company has achieved revenue of 6.62 crores with NP of 1.16 crores and
expected to deliver revenue of 30 crores in year 15-16 with expected NP of approx.
Rs5 crores and a small equity of 3.61 crores company can deliver EPS of 14-15 .
At current price of 116-120.Stock is available at PE of 8.5-9.
Almost debt free company.
Interestingly the company is owned by another bearing
manufacturing company NRB bearing which commands a PE multiple of 25 in comparison
to its subsidiary SNL bearing which is available at PE of 8.5. In the longer
run SNL Bearing could get merged with NRB bearing . Since SNL is a consistent
profit making company on a small equity base the price to book value should
increase with increasing profitability year on year basis. Currently NRB enjoys
quite a high price to book value similarly the P/Book value for SNLB is set to
increase in next1-2 year which could be major factor to determine the merger
ratio.
Long term investor could safely inter in this fundamentally
undervalued stock for decent (100%) returns in long run.
Target Price : 2 year target for the stock is Rs 200.
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.