Visaka Industries Q1 FY 2011 results were quite poor. Visaka Industries‘ YOY sales were down to Rs. 185 cr from Rs. 189 crores. Visaka Industries‘ EDITA was down to Rs. 32.35 cr from Rs. 39.34 cr while the Net Profit after tax was down to Rs. 20.70 cr from Rs. 25.84 cr. Visaka Industries‘ Diluted EPS was down to Rs. 13.03 from Rs. 16.28.
Visaka Industries‘ results were not much of a shock given that bigger bro Hyderabad Industries had already laid down the roadmap with its own poor Q1 FY 2011 results (See Hyderabad Industries – Poor Q1 2011 but nothing to worry).
The First Quarter is supposed to the best Q for companies like Hyderabad Industries & Visaka Industries. So, a subdued FY 2011 is on the cards for Hyderabad & Visaka.
Notwithstanding the poor Q1 results, Visaka Industries holds out a lot of promise for the patient investor.
Visaka Industries has grown steadily at a 3 year CAGR sales of 13%. Visaka Industries‘ 3 year CAGR Profit grew at 35%. Visaka Industries has a manageable Debt to Equity Ratio of 0.78 and offers a Return on Equity of 27%.
| Particulars | Quarter Ended | ||
| Jun. 2010 | Jun. 2009 | % Var. | |
| Sales | 185.97 | 189.00 | -2 |
| OPM % | 19.58 | 23.65 | -17 |
| PBDT | 35.34 | 43.88 | -19 |
| PBT | 31.28 | 38.53 | -19 |
| NP | 20.70 | 25.86 | -20 |
Visaka Industries‘ Book Value of Rs. 148 and low PE of 4.5 offers comfort in valuations.
Also at the CMP of Rs. 156, Visaka Industries‘ dividend yield is an attractive 3.1%.
Visaka Industries is also in a market with huge growing demand from the rural and semi-urban markets for cement and asbestos sheets.
About Visaka Industries:
| Q on Q Sales Growth (%) | : 9.48 | Q on Q Net Profit Growth (%) | : 42.27 |
| 3 Yr CAGR Sales (%) | : 12.75 | 3 Yr CAGR Profit (%) | : 35.02 |
| Debt to Equity Ratio (x) | : 0.78 | Net Profit Margin (%) | : 9.56 |
| Return on Equity (%) | : 27.02 | EV to EBITDA (x) | : 2.95 |
Visaka Industries was established in 1981. Visaka Industries is the second largest cement sheet manufacturer in India with the total installed capacity of 6,30,000 tonnes (the first is Everest Industries). Visaka Industries is diversified and also engaged in the manufacture of fibre cement products and synthetic blended yarn. Visaka Industries has a presence across India with 6 manufacturing plant for asbestos making plants and two for manufacturing garments. (See Also Hyderabad Industries – Roofing Profits & Everest Industries – Building Profits)
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