A forward! Any views folks?
Somi Conveyor Belts is a BSE Listed 70 Crore Market Cap company. FY15 Topline 75 Cr., OPM 16.5% and Net Profit at 4.5 Cr., currently available at less than 10 times forward, Somi has a decent balance sheet considering the size and nature of businesss.
Recent foray into high margin Steel Cord Conveyor belts is expected to take company into a whole new orbit. With a capex of Rs 35 Cr., it is expected to bring a topline of Rs 350 Cr. with 20-22% Operating Margin, which implies an extremely short payback period.
Current order book already stands at 140 Cr., which includes marqee names like Adani, L&T and some of the most respected MNCs in mining and power sector.
This order book is to be executed over next 6-12 months.
Current #2 in the country, Somi aims to be largest player in the world led by its superior technology and execution capabilities.
There is a huge sectoral tailwind; like aggressive plans of doubling coal output by 2020. The industry itself is expected go up multi-fold over next 4-5 years and Somi seems to be the best way to play this whole mining theme.
The stock has attracted ace stock pickers like Mr. Girish Gulati of Avanti Fame
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