stock rallied as anticipated
On Wednesday, 25 November 2015 8:58 AM, 'vij bo' via LONGTERMINVESTORSRESEARCH <longterminvestorsresearch@googlegroups.com> wrote:
IT IS COMMON KNOWLEDGE THAT METAL INDUSTRY HAD NOSE DIVED SINCE LAST 3 YRS AND MOST COMPANIES HAVE INCURRED LOSSES IN THE SECTOR. IN THIS SCENARIO INDSIL HYDRO HAS PUT UP CREDITABLE PERFORMANCE. INDSIL HYDRO IS INTO PRODUCTION OF FERRO CHROME , FERRO SILICON AND LOW CARBAN SILICO MANGANESE. IT IS NOT THAT THE COMPANY SURVIVED THE STROM BY PROVIDENCE BUT BECAUSE OF CAREFUL PLANNING BEFORE VENTURING OUT.
INDSIL HYDRO REALISED IN THE PLANNING STAGE THAT FERRO ALLOYS INDUSTRY IS POWER INTENSIVE AND IT CANNOT SURVIVE BY DRAWING POWER FROM SEB AT HIGH RATES. SO IT BUILT A MINI HYDRO POWER PLANT NEAR PALAKKD TO SERVICE ITS LOW CARBON SILICO MANGANESE PLANT AND TO EXPORT THE REMAINING POWER TO THE STATE GRID .INDSIL HYDRO ALSO REALISED THAT A FERRO CHROME PLANT IN INDIA WOULD NOT BE COMPETETIVE AS POWER TARIFF IS HIGH AND THEREFORE IT PUT UP A FERRO CHROME JOINT VENTURE IN OMAN JOING HANDS WITH A LOCAL CHROME MINER. INDSIL HYDRO HAD INVESTED ABOUT 18.1 CR IN THIS PLANT . IN ADDITION INDSIL HYDRO ALSO SUPPLIED TECHNOLOGY FRO WHICH IT DERIVES KNOWHOW FEE AND ALSO TAKEN THE BURDEN OF MARKETING FERRO CHROME FOR WHICH IT WILL BE PAID MARKETING FEE. JOINING HANDS WITH THE MINER ALSO ENSURED PROPER SUPPLY OF CHROME TO THE PLANT
ALL THIS IS WORKING AS PLANNED AND THE JOINT VENTURE HAS NOW GONE INTO FULL PRODUCTION AND THIS UNIT WILL START PAYING DIVIDENDS FROM 2017 WHICH WILL BOOST THE EPS OF INDSIL. FURTHER INDSIL IS NOW CONTEMPLATING FURTHER EXPANSION OF FERRO CHROME PLANT IN OMAN
THIS YEAR THERE HAD BEEN HEAVY RAIN AND DELUGE IN TAMILNADU AND ITS HYDRO POWER PLANT WILL WORK TO FULL CAPACITY AS THE RESERVOIR IS FULL. THIS IS NOT THE USUAL CASE IN NORMAL YEAR.
THE RESULTS PUT UP BY INDSIL IN BAD YEARS AS FOLLOWS.
THE COMPANY HAD ALSO DECLARED A BONUS AT 2 : 3 IN AUG 2010.
THE NOTABLE FEATURE IS THAT THE COMPANY HAD SHOWN DECENT NUMBERS IN BAD YEARS. AND WHEN THE CYCLE MOVES AROUND AND GOOD TIMES COME TO THE INDUSTRY THE RESULTS WOULD BE THREEFOLD INTERMS OF BOTTOM LINE
A PROFITABLE COMPANY WITH A BOOK VALUE OF 61.75 IS GOING CHEAP AT 37.20.. CHART IS LOOKING BULLISH NOW AFTER CONSOLIDATION FOR LONG ENOUGH.
| INDSIL | HYDRO | |
| CODE | 522165 | |
| YE 2014 | YE 2015 | |
| SALES | 124.04 | 123.44 |
| PBIDT | 18.75 | 24.33 |
| INTEREST | 3.71 | 5.05 |
| PAT | 10.86 | 12.15 |
| EPS | 6.84 | 7.65 |
| DIV | 12% | 12% |
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