Company Overview. Financial Performance

Transcription

1 CMP: 7.89 January 28, 2016 Stock Details BSE code BSE ID MNKCMILTD Face value ( ) 1 No of shares (m) week H/L 18.85/2.33 Market cap ( m) days avg vol (No) 12,435 Free float ( m) 89 Stock performance (%) 1M 3M 12M Absolute 7.4% 123.2% NA Rel. to Sensex -12.1% % NA Shareholding Pattern* (%) Promoters FIIs DIIs Others 62.95% % % 37.05% *As of September 2015 Relative Chart Source: Bloomberg Manaksia Coated Metals & Industries Ltd Sensex 30,000 29,000 28,000 27,000 26,000 25,000 24,000 23,000 22,000 Company Overview Manaksia is a conglomerate; it has 17 manufacturing plants in India and four overseas; two in Nigeria, one in Ghana and one in Georgia. The Group was promoted by Sri Basant Kumar Agrawal and Sri Suresh Kumar Agrawal. It is headquartered in Kolkata, India. Industry Overview The Indian steel industry is expected to grow moderately in the near future as end-user demand starts to pick up. Domestic steel capacity is expected to increase the growth of end-user industries. The Government plan to produce 300mtpa in a decade from now. India imported 9.3 million tones of finished steel in FY15, up 71.1% from a year ago, while it exported almost 5.5 million tons. Financial Performance For the period ending 31 March, 2015, Manaksia reported revenues of 2,152.5 million, representing gain of 28.2% when compared to the revenues in FY 14. The company has reported a net loss of 73.7 million in FY 15, when compared to the profit of 10.1 million in FY 14. For the period ending Q2 16, Premier has reported revenues of million and a negative bottom line of 1.4 million. Table1: Key Financials (Y/e March) FY 13 2Q FY15 2Q FY 16 Sales ( m) NA 1, ,152.5 NA YoY Growth (%) NA NA 28.2% NA NM EBITDA ( m) NA NA 32.2 EBITDA Margin NA 17.8% 20.4% NA 5.9% PAT ( m) NA 10.1 (73.7) NA (1.4) EPS ( ) NA 0.3 (1.1) NA () YoY Growth (%) NA NA NM NA NM Source: Company, Karvy Investment Advisory 1

2 Background and Business Description Manaksia is a conglomerate; it has 17 manufacturing plants in India and four overseas; two in Nigeria, one in Ghana and one in Georgia. The Group was promoted by Sri Basant Kumar Agrawal and Sri Suresh Kumar Agrawal. It is headquartered in Kolkata, India. Product portfolio: The product portfolio of Manaksia Coated Metals & Industries includes: Metal Products Mosquito Coils and Vaporizers. Color coated (pre painted) metal sheets & coils Key Strengths Government is taking initiatives to improve infrastructure of India, which can have a positive effect on company s financials once it enters the steel trading The players in the Steel sector still have a lot of scope to cover larger market and the rural markets are still untapped. Risks & Concerns The company has not started any business and is waiting for the steel market to recover to enter the market. If the Economic downturn is prolonged it can reduce the steel to develop new infrastructure in country, which can shrink the business opportunities. Board of Directors Table 2: Composition of Board Name Mr. Sushil Kumar Agrawal Ms. Vividha Salampuria Mr. Bharat Begwani Mr. Anirudha Agrawal Mr. Karan Agrawal Mr. Srinivas Kumar Venkata Nanduri Source: Company Relation with Company Managing Director Company Secretary Chief Financial Officer Whole-Time Director Whole-Time Director Whole-Time Director 2

3 Industry Overview The Indian steel industry has entered into a new development stage from , riding high on the resurgent economy and rising demand for steel. Rapid rise in production has resulted in India becoming the 3rd largest producer of crude steel in 2015 and the country continues to be the largest producer of sponge iron or DRI in the world. As per the report of the Working Group on Steel for the 12 th Five Year Plan, there exist many factors which carry the potential of raising the per capita steel consumption in the country. These include among others, an estimated infrastructure investment of nearly a trillion dollars, a projected growth of manufacturing from current 8% to 11-12%, increase in urban population to 600 million by 2030 from the current level of 400 million, emergence of the rural market for steel currently consuming around 10 kg per annum buoyed by projects like Bharat Nirman, Pradhan Mantri Gram Sadak Yojana, Rajiv Gandhi Awaas Yojana among others. At the time of its release, the National Steel Policy 2005 had envisaged steel production to reach 110 million tonnes (mt) by However, based on the assessment of the current ongoing projects, both in greenfield and brownfield, the Working Group on Steel for the 12 th Five Year Plan has projected that domestic crude steel capacity in the county is likely to be 140 mt by and has the potential to reach 149 mt if all requirements are adequately met. The National Steel Policy 2005 is currently being reviewed keeping in mind the rapid developments in the domestic steel industry (both on the supply and demand sides) as well as the stable growth of the Indian economy since the release of the Policy in India steel Industry : Production for sale (in million tonnes) Category Pig Iron Sponge Iron Total Finished Steel (alloy + non alloy) Source: Joint plant committee Competition analysis Company CMP ( ) Mcap ( m) Rev ( m) OPM (%) EPS ( ) PE (x) Manaksia Coated Metals & Industries Ltd , % -1.1 Nm Jsw Steel Ltd. 1, ,49,59 4,60, % Ahmedabad Steel Craft Ltd NM NA NM Source: BSE 3

4 Financial Analysis For the period ending 31 March, 2015, Manaksia reported revenues of 2,152.5 million, representing gain of 28.2% when compared to the revenues in FY 14. The company s EBITDA increased to million in FY 15 from million in FY 14, primarily attributable to increased revenues. Year end March FY 13 Income statement ( million) Revenue NA 1, ,152.5 % growth NA NA 28.2% EBITDA NA % EBITDA margin NA 18% 20% Depreciation and Amortisation NA EBIT NA Interest NA PBT NA 22.2 (107.4) Tax (credit) expense NA 12.1 (33.7) Net profit NA 10.1 (73.7) % growth net profit NA NA NM Balance sheet ( million) Shareholder fund NA Long term liabilities NA Current liabilities NA 1, ,041.1 Fixed assets NA 1, ,147.2 Current assets NA 1, Cash & cash equivalents NA Cash flow statement Cash flow operations NA Cash flow from investing NA Cash flow from financing NA 1, ,041.1 Per share data 1, ,147.2 EPS ( ) NA 1, CEPS ( ) NA DPS ( ) NA BVPS ( ) NA Financial Ratios % NA (100.3) (148.2) ROE NA (39.9) ROCE NA Debt/Equity NA 0.3 (1.1) Interest coverage ratio NA 2.0 (0.1) Current ratio NA NA NA Cash ratio NA Source: Company, Karvy Investment Advisory 4

5 Financial Snapshot Revenue growth (%) 2,50 3% 2, % 1,50 2% 15.0% 1,00 1% % % Revenue ( m) % growth EBITDA margin (%) 21.0% 2% 19.0% 18.0% 17.0% 16.0% EBITDA ( m) % EBITDA margin Net Profit Margin (%) BVPS & EPS % % -1.0% -2.0% Net Profit ( m) -3.0% -4.0% % net profit margin 11.0 Book value per share ( ) EPS diluted ( ) -1.5 Liquidity ratios Profitability ratios % 2% 1% % -1% -2% Current ratio Cash ratio ROE ROCE Source: Karvy Investment Advisory 5

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