We had recommended Pennar Industries in issue no. 21 dated Sept 19-Oct 2, 2016 when the scrip was trading at ₹43.65. Our recommendation was backed by the structural reforms in Indian
Railways and solar and civil construction driving growth. The company has also shown a strong order book across verticals and it is a low-debt and cash-rich company.
Pennar Industries Ltd, a holding company which is engaged in the manufacture of steel products, including cold-rolled steel strips (CRSS) and cold formed metal profiles. The company manufactures precision tubes, coldrolled formed sections (CRFS), electro static precipitators, railway wagons and coach components, press steel components and road safety systems. It also offers solar module mounting solutions; storage solutions, hydraulic components and auto components, electric resistance welded pipes, colddrawn welded tubes and air pre-heater tubes.
‘On a quarter-on-quarter basis, the company has posted robust numbers. In Q4FY17, the net sales of the company stood at ₹311.95 crore, an increase of 14.95 per cent as compared to Q4FY16. Its PBDT also increased
49.12 per cent tors 21.98 crore in the fourth quarter ended March 2017, as against ₹49.12 crore in the corresponding quarter previous year. The company’s PAT stood at ₹13.96 crore, up by 50.92 per cent as compared to ₹9.25 crore in Q4FY16.
After our recommendation, the share price of Pennar Industries has increased by over 11 per cent. Also, recently in the month of June 2017, the company and its subsidiaries have received orders worth ₹255 crore. So, we would advise our reader-investors to Book Profit.