Analysis on Bilpower
1.
it is the
largest 3rd party producer of laminated CRGO sheets used in
manufacturing of transformers. this coy has shown 80%
CAGR growth in revenue in past 4 yrs.it has expanded its capacity from 6000MT in FY06 to 12000MT in FY07.
2.
The coy is diversifying into manufacturing CRNGO
stampings. This product is used in DG sets, mixers, pumps etc. this strategy
will diversify their product.
3.
Bilpower has acquired
transformer repair facility called Tarapur
transformers. This facility has a capacity to repair 1500MVA of power of
transformers. Moreover, this is an higher margin business and may lead to expansion in
future.
4.
The coy recently announced that it as qualified
as turnkey contractor for transmission and distribution segment of power sector
in Maharastra. This coy is eligible for contract
worth INR 1800mn. And Govt. of maharastra has
approved INR100bn worth of investment in T&D space by 2010 in its recent
budget.
5.
valuation
based
on SOTP valuations, its value is 299.as fair price ,the stock should trade
at 5.7xFY09E EPS which will provide reasonable re-rating on value
added business and will also fairly discount low margin but high growth traditional business.
|
INR in mn |
Particulars(fy09ev/ebita
multiple) |
Amt |
|
Lamination |
3xFY09
EBITA |
1325.8 |
|
Stampings |
3xFY09
EBITA |
455.1 |
|
Transformers |
6xFY09
EBITA |
892.6 |
|
T&D EPC |
7xFY09
EBITA |
1344.0 |
|
Less net
debt(FYE) |
|
493.7 |
|
Fair market value |
|
299 |
Report Prepared By: Mr. S. KUMAR