Transmission line biz to yield major profits: Ramsarup Ind

Excerpts from Markets Midday on CNBC-TV18 Watch the full show » Ramsarup Ind BSE | NSE 10/02/12 Are Mutual Funds betting on Ramsarup Ind?

Ashish Jhunjhunwala, MD of Ramsarup Industries  says that their transmission line business has just begun and that they are expecting a total business of Rs 200 crore in transmission lines itself.

 

Excerpts from CNBC - TV18's exclusive interview with Ashish Jhunjhunwala:

 

Q: A very good sales as well as net profit numbers, do you think you will be able to maintain this kind of 50% growth for year-end as well?

A: We are confident of achieving this kind of growth. In fact, our growth will be more than this quarter because in this quarter we haven't been able to have any sales on account of transmission lines. Our transmission line business has just begun. We are expecting a total business of Rs 200 crore in transmission lines itself.

 

In this quarter, we have achieved a total sales of Rs 312 crore but we are looking at Rs 1450 crore of total turnover this year. With a total PAT of about Rs 60 crore as against last year of about Rs 27.5 crore

 

Q: Can you tell how much has the various divisions contributed to the total figure of Rs 312 crore? With capacity expansions coming on, how will the picture look at the year-end?

A: At this point of time about 78% comes from the wire division and 22% comes from the TMT division. By the year end, our total business will be something like Rs 1450 crore out of which 15% will come from transmission division and about 60-65% from wire division and the balance from TMT division.

 

Our major profitability will be coming from transmission line business where we are expecting a total profit of about Rs 20 crore from Rs 200 crore business. So that will increase our PAT substantially both in terms of numbers and percentage.

 

Q: Power sector constitutes about 40% of your revenues but your percentage of sales for the power division is very small. What are your thoughts on changing that mix going forward?

 

A: It will change because our business will be moving more towards transmission lines, which is absolutely a power segment. So finally somewhere around 55-60% will be from the power segment itself. Power is the happening sector in India and it is going to be a big story of which we want to take advantage.