Saturday, April 21, 2012

VULCAN ENGINEERS LTD - A POTENTIAL MULTIBAGGER









 











Be it Electricity or Petroleum products ,cost of energy resources are increasing year after year and this trend is expected to continue in future.So ‘Energy saving ‘ is the buzz word in corporate India especially in power/fuel intensive industries.On this back ground , companies working for implementing Eco friendly  energy saving technologies catching special attention. VULCAN ENGINEERS LIMITED(VEL) is a small company specializing  in design, engineering, construction and erection of kilns, process lines and furnaces for the steel industry.In India ,the size of steel industry is very large hence the scope too.Vulcan Engineering is originally incorporated in 1963,but its performance was poor mainly due to working capital deficiencies and its inability to move with technological changes.In 2010 this company was taken over by Italy based Terruzzi Fercalx Group (TFG) and now this foreign promoters holding 58% stake.In October 2011,company allotted another 13,10,000 Equity Shares of Rs. 10.00 each at a premium of Rs. 36.50 per equity share on preferential basis to SocietaItaliana Per le Imprese All' Estero - SIMEST SpA ('SIMEST') Italy which constitute 14% of the total equity.SIMEST is an agency formed by Italian goverment to promote italian business in foreign countries.The present promoter Terruzzi Group is in existence from 1897 and having many niche patented designs for  industries like Glass,Aircrafts,Steel,Pharmaceutical,Cement ,Food,Rubber ..etc and is well known for its energy efficient eco friendly designs and execution capabilities.TFG is also concentrating in Gasification technology which is for generating power out of waste.Under the old management , due to lack of sufficient working capital Vulcan Engineering executed the limited available orders through job work basis.But now under the new management company is working to set up its own fabrication facilities which is expected to ready by next 3-6 months.VEL is currently working on few projects for  Visakhapatnam Steel Plant and Neelachal Ispat.It is a fact that company  not reported any major order win in recent past . But the successful execution of the existing orders may turn as a testimony for the efficiency of new management and work as ‘reference projects’ for further order wins.Share price of VEL moved sharply after last quarter turnaround performance and now  trading around Rs.45/- which is close to last preferential offer price.If company can repeat at least the last quarter performance in March qtr ,it may move bit more and further order wins if any  may lift it to higher levels.Considering the potential of the industry ,foreign parents niche offerings and  vast experience, VULCAN ENGINEERS may turn as a multibagger in long term.CMP is Rs.44/-


Disc : I have vested interest in VEL

29 comments :

  1. http://www.bseindia.com/Insidetrade_ScripWise.asp?scripcd=522080

    In the above link there is no insider buying since 2 Years.... There is only one buying that is also Preferential allotment.

    ReplyDelete
    Replies
    1. Still suspicious !!!!!,I have nothing to get by telling lies to people like you .Stock market not means BSE website alone.

      Delete
    2. Well i never said your lying... just suspicious...
      Its better to look for downfall first...

      Delete
  2. HI ValuePick

    Thank you for your valuable recommendations

    Please suggest me what is your view on Edserv Soft Systems. it is trading under 52 weeks low. i have holdings at Rs.50, should i sell or average. i am the long term investor

    Regards,
    Venkat

    ReplyDelete
    Replies
    1. Selling by the promoter group itself is not a good sign for Edserv

      Delete
  3. Sir,

    Whar are your views on NCC and JVL Agro Industries?

    http://www.moneycontrol.com/india/stockpricequote/constructioncontractingcivil/ncc/NCC01

    http://www.moneycontrol.com/india/stockpricequote/vanaspatioils/jvlagroindustries/JVL01

    ReplyDelete
    Replies
    1. NCC may consider in any dip,not tracking JVL Agro

      Delete
  4. Sir,

    How about corporate governance? Do you think, the Italian promoter would be committed to Indian minority shareholders? Any interaction during the AGM?

    ReplyDelete
  5. Dear Ketan
    I didn't attend any of the AGM of this company personally,but the feedback received from the friends attended the AGM is positive.

    ReplyDelete
    Replies
    1. Sir,

      Italian promoter with Italian government holds over 75%. Do you think SEBI delisting norm would apply to them or since the Italian promoter holds less than 75%, they would be exempted?

      Any idea on the current order book of the company?

      Delete
  6. Dear VP ji

    Again today also as soon as market opens Vulcan engineers has raised by +10%. we saw there is tremendous positive resposne from the investors after reading your value pick article in your blog. Even it touched to 51/-

    I have been observing since last many times aftre your suggestions, the response is very high and stock is zooming up with high price. Any how i had brought 150 shares at +10% of your suggested price i.e at 48.

    hats of to your investigation for such type of multibaggers.
    Looking for your response,

    regards,

    M Phani...

    ReplyDelete
    Replies
    1. Thanks.Keep patience ,it is going to shift to 'T' group from Friday.

      Delete
  7. Yes, Mr. Valuepick mentioning that Stock market means not BSE alone is correct. Please go through the company's web link & what Mr.Valupick has reported is 100% correct as usual. - http://www.vulcanengineers.com/ Rajesh Shah,Sangli

    ReplyDelete
  8. great job sir in again spotting a gem, i jsut wanted ur view on avt natural products after its stock split and also if u can put ur view on advanta q4 results ,,, thanks a lot for sharing ur knowledge

    ReplyDelete
    Replies
    1. Neutral on AVT and positive on Advanta

      Delete
  9. Is it worth taking a risk in Ramsarup Industries at CMP

    ReplyDelete
  10. Sir I bought 3000 camson biotech at 79 can I hold or sell .

    ReplyDelete
  11. Dear Sir

    Do you suggest to add this at these rates i have bought @45

    ReplyDelete
  12. It has posted a loss of ~20 crores for march 2012 quarter. Should we wait for further decline to add more.

    ReplyDelete
    Replies
    1. Dear Deepak

      Your information is not correct ,loss is just 20 Lakhs in last quarter not 20 Cr as you mentioned.

      Delete
  13. Sir,
    Would it worry you that they made open offer at 15/- for the minority shareholders about how keen they are to protect the interest of minority shareholders?

    ReplyDelete
  14. Dear Shah

    What is wrong with the open offer price and minority interest. I don't think so.Because , there is a SEBI formula for fixing IPO price and it is based on then prevailing market price.It happened many months/before and price fixed based on then mkt price.

    ReplyDelete
  15. is it in your hold list after the first quarter results or should losses be booked?

    ReplyDelete
  16. dear sir, what do you think of vulcan engineers now. I am holding 8000 shares @29 and it is at 22 level currently.I read your old blog today about it as a multibagger. It would be of great help if you kindly revert with your opinion. It will be very precious for me. Best Regards,seema jain

    ReplyDelete
  17. Earlier you have posted your recommendations for Vulcan and Igarshi. I would request you to please share the present strategy for the investors holding these scripts.
    Thanks a lot.
    Regards,
    Anurag

    ReplyDelete
    Replies
    1. Since both stocks included in Periodic Call Auction ,Withdrawing the recommendation.

      Delete

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