Online
|
|
India May Raise 290 Billion Rupees from Share Sale in NMDC, SAIL & EIL
Posted by :
alkesh_thakkar
The Indian government may raise 290 billion rupees ($6.27 billion) from share sales in two state-run companies, NMDC Ltd. and Steel Authority of India Ltd., Steel Minister Virbhadra Singh said Monday.
The share sale process is likely to be completed in the current fiscal year through March 2010, Mr. Singh said.
The federal government is looking at the possibility of small stake sales in some state-run companies to raise funds and bring down its fiscal deficit, which is expected to reach 6.8% of gross domestic product for this fiscal year.
Apart from SAIL and NMDC, the government is looking at selling stakes in NTPC Ltd., Manganese Ore India Ltd., Engineers India Ltd. and Rural Electrification Corp.
Mr. Singh said the government hopes to raise about 130 billion rupees from a share sale in iron ore miner NMDC, and 160 billion rupees by selling existing and fresh shares in SAIL.
The share sale proposals will need to be approved by the federal cabinet.
The steel ministry has already approved a proposal to reduce the government`s stake in NMDC to 90% from 98.38% currently, Mr. Singh said.
Retail investors and financial institutions own the remaining 1.62% of NMDC.
Mr. Singh said the ministry has approved also a two-phased follow-on public offering for SAIL to partly fund the steel maker`s expansion plans.
The government plans to sell a total of 10% of its holding while the company is expected to issue additional shares worth 10% of the expanded equity base, Mr. Singh said.
In the first phase, the government will sell 5% of its shareholding while SAIL will issue an additional 5% equity.
The stake sale and fresh share issue will bring down the government`s holding in SAIL to around 69% from 85.82% currently.
...
Divestment, strong order book hopes buoy EIL share price
Posted by : alkesh_thakkar
EIL’s cash balance has tripled from Rs629 crore in March 2005 to Rs1,894 crore in March 2009. This has allowed it to remain a zero-debt company and also pay out healthy dividends to shareholders
Shares of government-owned Engineers India Ltd (EIL) rose by 14% last week to close at Rs1,460 each. A combination of various factors—a rumoured bonus issue, a strong infrastructure order book and divestment hopes—all seem to be pushing up valuations. EIL stands out among public sector units as a consistently profitable firm. It has two main revenue streams, with a 53:47 mix of large engineering consultancy services and lump sum turnkey (LSTK) projects in the infrastructure segment. It’s presence in a growing business segment has translated into a strong order book of around Rs8,000 crore. The next five-seven years will see high government spends with a thrust on infrastructure, energy and power projects.
EIL has various projects under execution, which will come into operation in fiscal 2010, fiscal 2011 and fiscal 2012, thereby assuring revenue growth of 25-30%.
EIL’s revenue for the September quarter grew 19% sequentially and 36% over the year-ago period, to Rs468.2 crore. While operating profit margins grew from 19% to 21% on a year-on-year basis, it dropped 4% sequentially. This could be on account of a larger contribution of the relatively lower-margin LSTK business. Profit after tax jumped by 59% over the year-ago period to Rs105.4 crore.
EIL’s operating profit margin is around 35% in the consulting segment, where it is known for its technological prowess and design expertise, and it competes with multinationals such as Foster Wheeler Corp. and Toyo Engineering Corp. Its LSTK business, however, is seeing a proliferation of players. Here, EIL’s strategy is to protect its margins of around 5-6% through open orders, where cost increases are directly passed on to the customer. Besides, diversification into areas such as water management, railway freight corridors and intelligent buildings, where competition is lower, will help sustain profit margins.
EIL is a cash-rich firm. Its cash balance has tripled from Rs629 crore in March 2005 to Rs1,894 crore in March 2009. This has allowed it to remain a zero-debt company and also pay out healthy dividends to shareholders. During fiscal 2009, EIL’s earning per share (EPS) was around Rs60 and its EPS for fiscal 2010 works out to Rs72, after annualizing its first-half earnings. Historically, the second-half is better for EIL and for other engineering companies, too, and its EPS could be higher as a result.
At present, the government holds 90% of EIL’s equity. Analysts view it as a potential divestment candidate. If the government sells part of its stake, liquidity will improve, as will valuations.
...
Engineers India rides high on bonus issue buzz
Posted by : alkesh_thakkar
The stock of Engineers India has gained over 24% in the past week on the BSE. The scrip ended over 2% higher at close on Wednesday at Rs 1,428.25.
Brokers say the stock is being driven by speculation that the company may announce a bonus issue of shares shortly. The other key trigger has been the announcement last week by the government that it planned to sell stakes in profitmaking public sector undertakings.
Analysts point out that Engineers India was among the few companies unaffected by the slowdown in 2008. Even as the company’s earnings grew 61% in FY09, there was a steady increase in new orders.
Engineers India is well-entrenched in high-end project consulting, which provides the company an edge when it comes to bidding for hydrocarbon, metal and infrastructure projects. ...
EIL Turned out to be Multi-bagger
Posted by : alkesh_thakkar
Most of the leading PSUs including State Bank of India, Union Bank of India, NTPC, Power Grid, Power Finance Corporation and Bank of India among others have delivered strong performance since their debut. In fact quite a few PSUs such as BHEL, Punjab National Bank and Engineers India, among others have turned out to be multi-baggers. If you have been smart enough to hold few hundreds shares of any of these companies for last 5-6 years, you no more have to worry over your retirement planning.
So is that a good reason for you to begin saving cash for any of the forthcoming IPOs? Unfortunately there is no easy answer to this. While historically, majority of PSUs have delivered superior returns on the bourses since their debut, the last few IPOs from this stable do not evoke much confidence. One of the main reasons PSUs gave superior returns in the past was because they were priced attractively. Low pricing was part of the government strategy to encourage public participation and maximise their chances of making money. For instance, National Thermal Power Corporation (NTPC) IPO was priced just 10 times its earnings, while PNB shares were sold as just 3x its earnings. The two companies are currently trading at a P/E multiple of 20x and 8x, respectively. This means that the shareholders not only gained from the secular earnings growth in these companies but also profited from their re-rating by the stock market.
In contrast, the last two IPOs from the government stable were expensive compared to the valuations of their listed peers. For instance, NHPC was priced at around 36 times its latest annual earnings, even as NTPC was available for just 20 times its trailing earnings. Similarly, Oil India was priced at a premium to ONGC, even though the latter is nearly 8-9 times bigger than the former. Such a large disparity in size typically demands that former is sold at a discount. ...
Divestment makes a comeback as markets shine
Posted by : alkesh_thakkar
Disinvestment has made a strong come back with the markets wit-Dnessing a marked improvement and as the new central government is in a
better position to push disinvestment process as the Left is no longer breathing down its neck. The benchmark indices Nifty and Sensex is up 100% since low of March 2009 and is now up 92% over the trailing 12-months .
In last term the UPA government’s effort at augmenting resources through disinvestment has been poor due to the opposition from the left parties which were a part of ruling coalition for a period of four-and-ahalf years of the five-year regime. By the time the Left Front withdrew support, the markets had tanked and companies which received regulatory approvals to tap the market developed cold feet on account of low investor appetite.
"As and when I find the market is favourable and I can get good money, I will go for disinvestment," finance minister Pranab Mukherjee has said earlier. The improved stock market conditions gave some of the companies confidence and created a positive backdrop to the idea of getting listed. In the last two months, two PSUs National Hydro Power Corporation (NHPC) and Oil India (OIL) have tapped the markets.
Piggybacking on the fresh issue of shares, the government has also been divesting the stakes in the companies. The government has raised more than Rs 8,000 crore from disinvestment in this fiscal year against a budget estimate of just Rs 1,220 crore.
As disinvestment came out of the deep freeze after five years, officials in the finance and administrative ministries for various public sector enterprises are putting in place a road map. The market is also expecting the divestment in blue chip PSUs to shore up the primary markets. Engineers India, Satluj Jal Vidyut Nigam (SJVNL), Rural Electrification Corporation (REC) and NTPC are expected to tap markets in coming months....
ENGINEERS INDIA Q2 Numbers Out
Posted by :
pms.swastika
ENGINEERS INDIA Q2 Numbers Out:
Net Sales at Rs. 468.20 Cr Vs Rs. 344.00 Cr (+36.10%) (YoY)
Net Profit at Rs. 105.37 Cr Vs Rs. 66.18 Cr (+59.22%) (YoY)
Regards
Swastika PMS...
Excellent results once again!
Posted by :
goldentipTrailing twelve months` EPS now more than Rs 76, the stock is available for less than 16 times earnings. For a growth stock that`s going to benefit from the infrastructure boom, it is reasonably cheap. Because of lumpy earnings from LTP, once should not look at q-on-q earnings and margin growth, rather, a full year P&L should be considered always for this stock. ...
BSE Announcements on EngineersInd
Posted by : MMB MessengerEngineers India Ltd has informed BSE about the Financial Results for the Quarter ended September 30, 2009....
NSE Announcements on EngineersInd
Posted by : MMB MessengerEngineers India Limited has informed the Exchange regarding the standalone Results for the half year ended on 30-SEP-2009 as follows: Net Sales of Rs. 85963.62 lacs for half year ending on 30-SEP-2009 against Rs. 59644.35 lacs for the half year ending on 30-SEP-2008. Net Profit / (Loss) of Rs. 19958.97 lacs for the half year ending on 30-SEP-2009 against Rs. 11680.91 lacs for the half year ending on 30-SEP-2008....
NSE Announcements on EngineersInd
Posted by : MMB MessengerEngineers India Limited has informed the Exchange regarding the standalone Results for the quarter ended on 30-SEP-2009 as follows: Net Sales of Rs. 46819.7 lacs for quarter ending on 30-SEP-2009 against Rs. 34400.4 lacs for the quarter ending on 30-SEP-2008. Net Profit / (Loss) of Rs. 10536.67 lacs for the quarter ending on 30-SEP-2009 against Rs. 6617.74 lacs for the quarter ending on 30-SEP-2008....
EIL to join hands with Delhi govt to develop school
Posted by : alkesh_thakkar
Engineers India Limited will join hands with the city government to convert a senior secondary school in South Delhi into an elite school having all advanced facilities.
Officials said the senior secondary school in Sangam Vihar will be developed at a cost of Rs five crore and Engineers India Limited will bear bulk of the expenses besides offering technical expertise.
"The school will have a large computer centre, modern library and a sports ground," an official said.
The project will be first of its kind in the national capital between the Delhi Education department and a public listed company.
Meanwhile, Education Minister Arvinder Singh Lovely today visited various schools in South Delhi to take stock of infrastructure deficiencies....
Engineers India potential multi-bagger
Posted by : GuestWhere did you find order book info? I am trying to find out the same. I agree with your analysis. ...
BSE Announcements on EngineersInd
Posted by : MMB MessengerEngineers India Ltd has informed BSE that the Annual General Meeting (AGM) of the Company was held on September 18, 2009....
NSE Announcements on EngineersInd
Posted by : MMB MessengerEngineers India Limited has informed the Exchange that Consequent upon the superannuation from the services of Engineers India Limited, Shri Mukesh Rohatgi has relinquished the post of Chairman & Managing Director & Additional Charge of Director (Finance) with effect from close of work, September 30, 2009....
BSE Announcements on EngineersInd
Posted by : MMB Messenger
Engineers India Ltd has informed BSE that consequent upon the superannuation from the services of the Company, Shri. Mukesh Rohatgi has relinquished the post of Chairman &
Managing Director & Additional Charge of Director (Finance) with effect from close of work, September 30, 2009....
