Geometric: Why Ramesh Damani recommends this stock. Geometric declared decent first quarter 2011 results. Geometric’s Q1 consolidated net sales were up at Rs 135 crore as compared to Rs 129 crores. Geometric’s consolidated net profit was up at Rs 10.6 as compared to Rs 8.4 crores. Geometric’s 12-month EPS as of March 2010 was Rs 7.51 per share. The EPS for the 1st Quarter 2011 was Rs. 1.70 showing a steady rise of 26.86% over Qi 2010 EPS of Rs. 1.34.
G Ravi Shankar, MD & CEO, Geometric told CNBC-TV18 that the revenues increased by 6.3% this quarter because of the good order book that Geometric had generated in the previous couple of quarters. Geometric’s engineering services revenue had grown by about 20% as compared with the previous quarter. Geometric’s revenue would have gone up by another 1.3% had it not been for the euro-dollar volatility. Geometric’s revenue would have grown by about 7.6% if one were to adjust to a normal euro-dollar equation, Ravi Shankar stated.
Geometric’s Q1 Key Financials
|
| (Rs cr) | Jun 2010 | Jun 2009 | YOY |
|---|---|---|---|
| Operating Income | 135.45 | 129.32 | 4.74 |
| Total Expenses | 116.09 | 112.20 | 3.47 |
| Operating Profit | 19.36 | 17.12 | 13.08 |
| Other Income | 0.31 | 1.55 | -80.00 |
| PBDIT | 19.67 | 18.67 | 5.36 |
| PBT | 13.43 | 11.72 | 14.59 |
| Adjusted Net Profit | 10.82 | 8.53 | 26.85 |
Ravi Shankar also stated something that was pleasing. Ravi Shankar said that the entire engineering services operations that Geometric does is for manufacturing companies and that there were lots of opportunities now for Geometric. Ravi Shankar said that lots of companies were talking about the new work that Geometric could do for them. He said that customers were increasing the kind of expenses that they could incur in new development areas and that’s what is resulting in Geometric doing more of non discretionary projects as well.
So far, Ramesh Damani’s prognosis of Geometric is proving correct.
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