Boeing, Tata set up plant to make Apache fuselages in Hyderabad
HYDERABAD: Boeing and Tata Advanced Systems Limited (TASL) have joined hands to set up a facility here to co-produce Boeing AH-64 Apache helicopter fuselages and other aerostructures. Defence Minister Manohar Parrikar on Saturday laid the foundation stone of Tata Boeing Aerospace Limited (TBAL) at the aerospace Special Economic Zone (SEZ) at Adibatla on the city outskirts. The facility will also deal in integrated systems in aerospace and will eventually be the sole producer of AH-64 fuselage globally.The AH-64 Apache is the world’s most advanced multi-role combat helicopter and used by the US forces as well as many other countries, including India.Parrikar termed the joint venture one of the initial big foreign direct investment in defence and aerospace under the government’s ‘Make in India’ initiative. He noted that Boeing kept its word given to him at the concluding of Apache and Chinok deals. “They had promised that this particular facility will be located in India and they will be shifting it from the place where they have the facility,” he said. TASL, a wholly owned subsidiary of Tata Sons, is already on contract to manufacture aerostructures for Boeing’s CH-47 Chinook and AH-6i helicopters. Boeing and Tata had last year announced a joint venture for manufacturing aerostructures and collaboration on integrated systems development opportunities in India. This joint venture will create a manufacturing center of excellence to produce aerostructures for the AH-64 Apache and provide affordable manufacturing capabilities to the global aerospace industry. Dave Koopersmith, Boeing’s Vice President, Vertical Lift, said Indian industry was providing critical support to Boeing commercial and defence programmes. He said the company recently partnered with universities and scientific institutions across India which will not only enhance aerospace and defence development capabilities but to create engineering talent. He said the ground breaking demonstrate Boeing’s commitment to further expand aerospace ecosystem and footprint and continue developing key technologies in India. Pratyush Kumar, President, Boeing India, said Boeing had doubled its procurement from India since last year to almost Rs10 crore per day and planned to continue doing this. S. Ramadorai, Chairman of TASL said the groundbreaking ceremony is a significant milestone in furthering their commitment to the Indian aerospace sector. Sukaran Singh, MD and CEO, Tata Advanced Systems, said they were proud to partner with a company like Boeing. Great Eastern Shipping Ltd has two main businesses viz. shipping and offshore. The shipping business is involved in the transportation of crude oil, petroleum products, gas and dry bulk commodities. On the other side, the offshore business provides services to the oil companies in carrying out offshore exploration and other related activities. The company’s current fleet consists of 32 vessels along with nine dry bulk carriers. As per official data from the Ministry of Shipping, around 95% of India’s trading by volume is done through maritime transport. For 2015, the cargo traffic recorded 1,052 million metric tonne which is expected to grow by more than 50% in the next few years. At the valuation front GE Shipping stock is trading at trailing P/E multiples of 4.5 times which is lower than the industry PE multiple of 8.7 times. At an attractive Book Value of Rs 560 and dividend yield of over 3.5%, the company earnings per share stand at Rs 69 on Rs 10 face value. The GE Shipping stock is an excellent portfolio investment for investors to purchase the stock for smart gains in the next one year. The long term demand outlook of the cement industry remains quite positive considering the government’s focus on housing, concrete roads, smart cities and infrastructure development. No wonder for the January-March 2016 quarter, the cement demand registered a double digit growth and uptick in prices. Ambuja Cement Ltd is part of the Swiss based Holcim Group which had acquired a controlling stake in Ambuja Cement in the year 2005. With Associated Cement Company (ACC) already in Holcim’s fold, the latter controls one fifth of the total cement capacity in the country. Ambuja Cement is the third largest cement company and the most efficient cement producer in the country. The company also has an equity stake in ACC. Specialised cement for the roof has a huge demand among home owners and building contractors. Ambuja Cement has recently launched a super speciality cement Ambuja Plus that extracts 100% of silicate gel from cement making the concrete stronger, durable and leak proof. The management of the company expects a tremendous response for this product resulting in volume growth in the next quarter numbers. The company reported Q1 CY 16 (it follows January to December as financial year) quarter earnings above market expectations on the back of lower costs. The share is currently trading at its support level of Rs 235 and its fundamentals make Ambuja Cement a value buy. The stock is expected to move up from the present level to a target price of Rs 275 in the next two quarters. Both the above stocks mentioned are pure fundamental and good quality stocks but investors are advised to wait for the correct opportunity considering the market sentiment pertaining to the events happening in the UK - Brexit. Rajiv Kapoor is a share broker, certified mutual fund expert and MDRT insurance agent.