Suprajit Engineering - Mixing Aggression and Caution

Discussion in 'School Of Stock Market' started by Sudipta Banerjee, May 2, 2020.

  1. Sudipta Banerjee

    Sudipta Banerjee New Member

    Feb 15, 2020
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    Suprajit Engineering started in 1987 as Automative Cables Supplier of TVS Motors, and is currently India's largest cable manufacturer.
    Initially, the company mainly sold its Cables to 2-wheeler companies. In addition it also now sells for 4-wheelers, After Market Sales, Outdoor Power Equipments in US.

    Suprajit is a growth oriented company which also shows considerable caution when needed.
    Suprajit had bagged Rs.40 Cr contract for Tata Nano in 2010, beating 5 other competitors.
    Accordingly it bought land in Sanand to supply to Tata Nano factory.
    However, Tata Nano did not scale up, and Suprajit simply supplied from its plant in Vapi.
    Finally, in 2015-16 the company made its factory in Sanand, to cater to its own needs.

    Suprajit is run by its founder Shri K. Ajith Kumar Rai whose maximum remuneration is from commision of profits. As company scales up, he is reducing his commision% from Net Profit.

    Till 2016, the company had to take loans for its capex at all times, due to which its debt was increasing considerably. In the 2016-17 QIP, it received about Rs. 150 Crores was received after which the company is able reduce its debt.