Texmo Pipes listed, FY10 EPS to be over Rs 5, says mgmt

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Texmo Pipes listed, FY10 EPS to be over Rs 5, says mgmt

In an exclusive interview with CNBC-TV18, Sanjay Agrawal, Chairman of Texmo Pipes, spoke about the company and its plans going forward.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Texmo Pipes surges 34% after listing Nifty BSE | NSE 24/05/12 Are Mutual Funds betting on Nifty?

Shares of Texmo Pipes and Products hit the bourses today. Huge buying interest was seen on the listing day itself. It opened at Rs 92.80 and touched a high of Rs 126.70 on the National Stock Exchange (NSE).

Commenting on the company's scale and size, CNBC-TV18's Executive Editor Udayan Mukherjee said, "Texmo is a very small company, it's a Rs 70 crore pipes company with very thin margins-basically a small cap. One telecom order goes bust and you may see a sharp fall in revenues. This is not a big Jindal Saw kind of company. The margins are 3-4% so you can get back into the red quite easily. So nothing in the fundamentals gives you that kind of confidence and it's a completely commodity player, low end of the pipes brand with 3-4% margin. There is no margin of safety at all. So looking at the IPO allotment there will be fun and games for a first couple of days but I don't think the fair value of this stock is whole lot above Rs 70-75 of that. It may take its time to come there. I am quite sure once the fun and games are over the stock will gravitate to below its issue price."

In an exclusive interview with CNBC-TV18, Sanjay Agrawal, Chairman of Texmo Pipes, spoke about the company and its plans going forward.

Below is a verbatim transcript of the interview. Also watch the accompanying videos.

Q: How, according to you, will FY10 end in terms of revenues and profits?

A: Our results have been quite better in the last year. And, we forecast that this year too we will cross more than what we achieved last year. We are going in for aggressive marketing and our marketing channel is also very good and so is the product line. Also, there is good growth rate. So we perceive in a positive aspect and we are very much optimistic.

Q: So in this financial year what do you think you will do in sales and profits in numbers?

A: Last year we crossed Rs 69 crore and this year we will cross more than that and because the product line that we are bringing is very optimistic in the market, fittings and the expansion existing products. So looking at this we are optimistic that we will get good growth.

Q: Last year you had net profits of just under Rs 5 crore-this year what will your net profit be like?

A: The product is having very good margin because of the expansion line that we are bringing in that is the fittings, there is good scope and margin.

Q: How much profit will you make this year?

A: Definitely we will cross the profit what we had achieved last year but in terms of the figure right now, I cannot comment.

Q: So our estimate is that you should do about Rs 5 in EPS this year, will you cross that?

A: Definitely because we are forecasting for better results and we look for better thing. So we think we will cross that.

Q: So in terms of sales would you do more than Rs 80 crore this year or that looks too much?

A: More than what we have achieved that is more than Rs 80 or 90 crore also.

Q: Who are the three QIBs who were allotted almost 50% of your issue?

A: Right now it will not be possible to give you names, I will have to check.