Mar 28, 2013, 07.32 PM | Source: Moneycontrol.com
Firstcall Research has recommended hold rating on Mcnally Bharat Engineering with a target of Rs 81, in its March 23, 2013 research report.
, Firstcall Research |
“McNally Bharat Engineering Company Ltd. (MBE) is one of the leading Engineering Companies in India engaged in providing turnkey solutions in the areas of Power, Steel, Aluminium, Material Handling, Mineral Beneficiation, Pyro processing, Pneumatic Handling of powdered materials including fly ash handling and high concentrate disposal, coal washing, port cranes, civic and industrial water supply etc. Over 300 plants have been constructed on turnkey basis by MBE till date. In 2011 they are celebrating their Golden Anniversary year (1961 - 2011). The Company, headquartered at Kolkata, is a part of the Williamson Magor Group. The EPC project activity is managed through separate Business Divisions Groups that assume responsibility for each activity from concept to commissioning. MBE has been awarded ISO 9001:2008 certification.”
“MBE manufactures a wide range of products required for its various projects through its subsidiary company McNally Sayaji Engineering Ltd. (MSEL), to whom it provides the requisite technology and design to manufacture the products. MSEL product range includes crushing, Mobile Crushing and Screening Plants, screening & milling equipment, pressure vessels, material handling equipment, steel plant equipment, process equipment like flotation cells, thickeners, slurry pumps etc. MBE has technical collaborations with some of the world’s leading firms for each of their activities. Some of our associates include SOLIOS - France, Poltegor- Poland, TPE - Russia, DMT - Germany, Siemens Vai - France, KCI Cranes - Finland, CODCO - China, GRD Minproc - Australia, Gea Messo - Swiss, MCC (China), Uralmash Engg. - Russia, Mekhanobr Chormet (Ukraine) etc. MBE through its subsidiary MBE Mineral Technology Pte Ltd, have acquired in 2009 the Coal & Mineral Technology division of KHD Humboldt Wedag, a global leader in coal and mineral processing. MBE also has a third subsidiary EWB, Hungary.”
“McNally Bharat Engineering Company Ltd is one of the leading Engineering Companies in India engaged in providing turnkey solutions reported its financial results for the quarter ended 31st Dec, 2012. The company’s net profit decreased to Rs.54.40 million against Rs.125.10 million in the corresponding quarter ending of previous year, a decrease of 56.51 percent. Revenue for the quarter rose 6.14 percent to Rs.5205.50 million from Rs.4904.30 million, when compared with the prior year period. Reported earnings per share of the company stood at Rs.1.75 a share during the quarter, registering 56.51 percent decline over previous year period. Profit before interest, depreciation and tax is Rs.350.20 millions as against Rs.346.60 millions in the corresponding period of the previous year.”
“At the current market price of Rs.70.80, the stock P/E ratio is at 7.17 x FY13E and 6.80 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.9.88 and Rs.10.42 respectively. Net Sales and Operating Profit of the company are expected to grow at a CAGR of 8 percent and 17 percent over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 3.84 x for FY13E and 3.37 x for FY14E. Price to Book Value of the stock is expected to be at 0.61 x and 0.56 x respectively for FY13E and FY14E. We recommend ‘HOLD’ in this particular scrip with a target price of Rs 81 for medium to long term investment,” says Firstcall Research report.
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