M Cap: As 380 Cr
The south-based manufacturer of air compressors and automobile service station equipment saw its promotercum-managing director Jairam Varadaraj buy about 28 lakh shares on August 19 to increase his stake to 3.59 per cent. The average price of the stock has, however, inched up by only about 1 per cent in the recent fortnight, whereas average volumes were down by about 40 per cent. The company, which is the market leader in India, recently set up a subsidiary in China for production and distribution of air compressors, associated spare parts and accessory equipment, related technical consultation service. Between FY05 and FY08, the company’s sales grew at a CAGR of 16.5 per cent to Rs 451 crore in FY08, while operating profit grew at 17.4 per cent to Rs 55 crore and net profit jumped 22 per cent to RS 39.5 crore. The company has consistently shown an improvement in sales and operating profits for the last three years. In June 2008 quarter, while salesgrewata modest6.5 percent to Rs 114 crore, operating profit margin improved as operating profit increased at a faster rate of 12.5 per cent to Rs 13.5 crore. The stock trades at an attractive multiple of about 6 times its FY10 earnings.
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