PENNAR IN­DUS­TRIES

Dalal Street Investment Journal - - REVIEWS -

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.

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