Saturday, October 6, 2012

KSB PUMPS LTD - TO PUMP YOUR PORTFOLIO




KSB Pumps Ltd   jointly  promoted by Lein Schanzlin & Becker A.G. of  West Germany and India based Industrial & Prudential Investment Co. Ltd in 1960.Currently the foreign holding is held by Canadian Kay Pump Ltd an associate company of KSB Germany.Company manufacturing various type of pumps  and valves for industries like water treatment ,chemical,mining ,oil ,power generation ,sewage ,nuclear power and for Agriculture.Company having five manufacturing plants  in India, Pune and Sinnar manufacturing facilities makes pumps for  irrigation and power projects, Nashik plant manufacturing multistage pumps, water and submersible motor pumps.Its valve manufacturing facility is located at Coimbatore and captive foundry at  Ahmednagar .KSB started manufacturing of  pumps for nuclear industry in 1977 from its factory located at  MIDC Industrial area in Pimpri and signed and exclusive long term agreement with NTPC in 1988. Company having very good brand image and known as a quality producer of pumps for irrigation  purpose.In power and petrochemical sector competition is less due to the mandatory adherence of American Petroleum Institute standards. KSB also executing  turnkey projects  for industrial and agriculture purpose.Due to over all sluggishness in the user industries company’s last year was muted  and cash flow was not satisfactory.But even fighting with the tough situation in local market ,this year company improving its performance .Increased off take by its parent company KSB AG is also helping to improve its performance.For the FY 2012 ,KSB posted a turnover of Rs.751 Cr and a net profit of 43 Cr.In latest June quarter company recorded a Sales of Rs.190 Cr and a net profit of Rs.17.5 Cr . The most attractive part of this company is the quality of its operations , not only in its products but in corporate governance  and minority  share holder friendly attitude too.Company having  an uninterrupted dividend paying record  and issued bonus shares to its share holders in the years 1983,1986,1989,1996 and recently in last year.I believe this MNC company will be an out performer when there is  a re rating in capital good/engineering industry  and one of the best mid/small cap stock to hold even in your core portfolio. KSB is listed both in NSE and BSE and CMP is Rs.212 /-

Link to the company website HERE

Link to latest AR. HERE

91 comments :

  1. Thank you sir, could you please let us know which is better among Rotor pumps and KSB pumps?

    ReplyDelete
    Replies
    1. Both are good .Generally MNC cos always getting premium valuation in stock markets of India.

      Delete
  2. Dear VP,

    Nile Limted your old pick, looks good at 112 CMP. I just wanted to know you views on comparison of Nile Limited with Gravita India. As After selling the glass lined equipment division , I think these two companies are exactly in same business, but looking at MCap and Sales turnover of Gravita and that of Nile the equation goes wrong somewhere. I dont know is it good to compare these two companies. Please let us know your views on this.

    ReplyDelete
    Replies
    1. I prefer Nile over Gravita .I think there is excess operator activity in Gravita hence the difference in market cap .But ultimately quality will win.

      Delete

  3. Dear VPji

    There is a talk in the street that your Sequent Scientific will break 1000 .What is your take on this target?

    Manhar

    ReplyDelete
    Replies
    1. Dear Manhar

      Anything possible in market especially on low floating stock companies like this if them post good results .Not to speculate on targets.

      Delete
  4. dear sir,

    thank you once again for this recommendation. one question sir, how to find the list of companies which are listed only on bse ?

    regards
    kalyani

    ReplyDelete
    Replies
    1. Why you need such a selection.Just find out good companies and then check where it is listed.I think Company is important than exchange.

      Delete
  5. wow very nice ans vpjiBut ultimately quality will win. u r 100% rite

    ReplyDelete
  6. DEar VP,

    Could you please share your views on KRBL? Is it worth to stick to this stock for long term?

    Thx for your time.
    Best regards,
    Reddy

    ReplyDelete
  7. Dear VP Sir.....

    THANKS... Sir what is u r opinion on CCL Product And ACRYSIL INDIA... do u hav any idea on this Sir

    Thanks

    ReplyDelete
    Replies
    1. Before posting comment please check whether the same question answered in recent time using the search option above.We can save a lot of time and energy :)

      Delete
  8. Thank you sir for your pic again...but what is your view on Shakti pumps, though it is being hammered currently. They are making solar pumps which can give them a good go ahead...What are your views on this?

    ReplyDelete
  9. Dear VP,
    I need to know whether KSB Pumps should be bought for long term or short terms???
    Which is better?
    What is its target price?
    Would U recommend RS Software for short term??

    ReplyDelete
    Replies
    1. What fundamental change you are expecting in a company over night ?

      Delete
    2. dear VPji,
      i wanted to know whether i should hold KSB Pumps for long term(i.e 1year)or short term (i.e 3 months)?
      Is it a multibagger?

      Delete
    3. Please don't expect any short term recommendations in this blog and never expect each and every scrip will turn as a multibagger and not insist only invest in multibagger.If every one in the street believes a particular stock will become multibagger,that stock will never become a multibagger.

      Delete
  10. Ur recommendation on RS software??

    ReplyDelete
  11. Hello VP,

    Need to know whether one should invest in Marg Ltd, Vikas Wsp and Omnitex Ltd.

    ReplyDelete
    Replies
    1. Nothing special as attractive for me and not sure about the quality of promoters.

      Delete
  12. Dear Sir,

    I have Yuken. Should i switch to this script? I am a bit confused please suggest me.

    ReplyDelete
  13. Dear VP ji,
    What is your take on Indian Hotels, looking at the growth of the new ventures they are into, it can easily cross by 100+ in very showrt term. What is your take sir?

    ReplyDelete
    Replies
    1. Suitable for low risk investors with enough patience.

      Delete
  14. sequent willlllll break 460 soon. Aftr result it will run in the right valuations. However for looking long term holding street will pay u correct value. Beholded otherwise no meaning. It is th time of examinationagainsh the true investor vs gridy investor. Hope all will be qualified.

    ReplyDelete
  15. what about ur old recomendation of orchid pharma ? what is your view about their division sell to hospira ?

    ReplyDelete
    Replies
    1. Promoter having ideas but not deep pockets .Still I have faith in it but will take some long time.

      Delete
  16. Everyone is asking questions. Let me ask followers if they even did check on the company and read their results and AR? Did you put any efforts to understand what the company does?

    Someone is asking for stock for short term, some long term, shakti pumps etc.

    Read and develop your conviction first and the questions will be answered by yourself only.

    ReplyDelete
  17. Hi VP..

    How would you read this ESSEL's selling in IVRCL... Hsve purchased recently at 51 and now it islikely to fal bck to 42... What will be the long term impact??? any chanced fot it to bounce back higher?? Also please share your views on investing in Hanung for for longterm

    ReplyDelete
  18. Not tracking both these cos. Regarding Hanung , there is more than enough hype in this stock and I am not advising this stock and at the same time not sure whether it will move reasons other than fundamentals.

    ReplyDelete
  19. Dear Valuepick,

    The Delisting of Transgene Biotek is being announced by the promoters and the floor price was fixed at rs. 25/- and above per share. The current market price is near rs. 10/-. Is it advisable to buy this share.
    Looking at the share holding pattern Promoter holding is 9.78% public is 16.78% and Custodians is 73.44%.
    Now, whether Custodians have a role to play in delisting process(i.e Delisting approval by postal ballot and RBB).

    Please share ur views.
    Thanks,
    Ram.

    ReplyDelete
    Replies
    1. Since I have no conviction on the promoters of Trangene ,I am not tracking it

      Delete
  20. Dear VP
    Request your opinion on Hatsun Agro Products

    ReplyDelete
  21. Sir,

    Can you please give your view on Emco. I think fundamentally it is very good. Please suggest me.

    ReplyDelete
    Replies
    1. Some more time may take for a re rating

      Delete
    2. Thanks Sir.

      Can you please explain a bit more. Do you have concern because of power sector.

      Delete
  22. Hello VP..

    Thanks a lot for your recommendations!!! I would like to know your views on TCI Finance and VLS Finance..

    ReplyDelete
  23. Dear Sir,

    Can you please give your view on Punjab Sind bank and UCO bank. I have huge no. of these script at very high price. Shall i stay in this script or should i switch to another good script.

    ReplyDelete
    Replies
    1. Not following many banking stocks ,only tracking YEs Bank,ING

      Delete
  24. HI VP

    Just out of curiosity isn't roto pumps with EPS of 23 and PE of 5 a better stock than KSB with EPS of 12 and PE of 17 considering both are in the same business dynamics? Also my observation is the pumps industry are usually a lagging indicator of the Capital Goods industry. They perform well only when order execution from CG companies start flowing.... Thanks for your solid research as always..

    Could you comment on Cenlub Industries a stock which you had recommended long while back and now it is available at excellent valuations! Also your views on Navin Fluorine would be appreciated...

    Once again Thanks VP :)

    ReplyDelete
    Replies
    1. Numbers are one important factor,but there is many more which influencing stock prices.

      Delete
  25. Dear VPji

    Please go through below news which published in Reuters few years back and give your valuable opinion about the possibility of it

    Strides Arcolab mulling sale of generic pharma to SeQuent

    Strides promoters, who are personal investors in SeQuent, explore buyout options if it decides to offload generic pharma Bangalore-based mid-sized and deal-savvy Strides Arcolab may be exploring the possibility of divesting its generic pharma arm to SeQuent Scientific Ltd. Strides Arcolab promoters Arun Kumar and KR Ravishankar are personal investors in the much smaller cross town peer, Sequent."The common shareholders of the two firms are looking at a transaction involving sale of the legacy (generic) pharma operations of Strides Arcolab to Sequent.While it may not exactly fit into Strides Arcolab's plans to emerge as a powerhouse in sterile injectables, generic pharma operations continue to be viable from a standalone manufacturing perspective," a source directly familiar with the development told VCCircle.Sequent Scientific Ltd is involved with manufacturing of active pharmaceutical ingredients (APIs), drug intermediates and fine chemicals for multiple sectors. The company, with a turnover in excess of Rs 100 crore, is now listed on bourses following the merger with PI Drugs & Pharmaceuticals. Strides Arcolab, with topline revenue of Rs 1,328 crore in 2009, saw generic pharma contributing Rs 445 crore.A divestment to Sequent will be the preferred option if Strides decides to offload gereric pharma, the source said who did not rule out the possibility of a possible transaction within this calender year. "We have no such plans and are unwilling to comment on speculations," said Arun Kumar, Vice Chairman & Group CEO, in an emailed response.
    Meanwhile, the promoters at Strides Arcolab have worked on further restructuring fleshing out branded generics out of the legacy or generics pharma. At present, Strides Arcolab has three divisions: generic pharma (Rs 445 crore), branded generics (Rs 590 crore) and specialties (Rs 374 crore).In 2010, revenue from specialties led by sterile injectables is expected to jump 50%, while branded generics will rise 16% and generic pharma by 10-11%.Moreover, generic pharma is faced with increasing pressure on margins in a highly competitive market. Last month, VCCircle reported that Strides might look at raising private equity or divesting generic pharma to grow inorganically in steriles.Strides Arcolab effected multiple acquisitions totaling $192 million in the sterile injectables space in recent weeks. This included buying its partner Aspen's manufacturing facility in Brazil, and mopping up shares in oncology joint ventures once again with Aspen.A recent press release from the company said it proposes to discharge its obligation through a combination of licensing Income and bridge loans. The possibility of a divestment towards Sequent will not be driven by debt obligations as much as the first generation entrepreneur duo's desire to keep a still viable manufacturing business devoid of all the corporate expenses of global pharma.In a recent conversation with VCCircle, Arun Kumar had said: "Strides wants to grow through partnerships. From that perspective, one can argue that generic pharma does not fit into our strategy as there is no arbitrage scope for two partners in it (most of our business deals, with Pfizer and GSK, are in specialty business because this is where there is arbitrage and margins for two companies to share).But from a manufacturing point of view, without all these expenses of a global corporate, it is still a viable business," he said.The legacy business is there, and at an appropriate time, we will take a critical look at it. So, am I going to sell, my answer is we do not know. Whether we will look at options, there should be compelling reasons for any entrepreneur to look at them," he had explained.

    ReplyDelete
  26. I have posted the details about this stock recently ( http://value-picks.blogspot.in/2012/09/gts-2-answer-sequent-scientific-ltd.html )

    As I mentioned in my previous posting this company is owned by the same promoters of Strides Arcolab and these promoters are very aggressive and known for their deal making abilities .Considering the nature of Inorganic growth happened in their other company we can't rule out anything in this line in sequent too.Let us wait and watch

    ReplyDelete
  27. buy -coromandal international or tata chemical?
    PATIDAR

    ReplyDelete
    Replies
    1. Both are good cos for long term .There may be some muted performance in next few quarters.

      Delete
  28. Hello VP,

    Query reg sequent scientific. you said promoters are raising their stake, as per BSe india upto sep 2011 promoters had 72.51%. Any reason for the decrease in the next quarter i.e to 55.57% ?

    ReplyDelete
    Replies
    1. This may be due to some internal arrangement as part of previous scheme .These shares are transferred to public category in more than 1 % holdings.

      Delete
  29. Dear sir,
    Too much investor attention means too much trouble in price movement of a stock ?

    ReplyDelete
    Replies
    1. Not means like that ,But if entire details are available in the public domain and stock is already caught more and more investor's attention there will be nothing left in the table.This is the basic reason - a stock over owned by the general public will never become a multi bagger.

      Delete
  30. sir when you will post the guess no.3 ?????????????????????????????????????????????

    ReplyDelete
  31. I am seriously re thinking about it .I feel some negatives in it.Few investors who correctly guess the stock buys bulk in advance and offloading the same to others on the posting day.Even such stocks are intended for long term investment some are using it to make quick money .Those buying on posting day always at receivers end and loose unnecessarily as in the cases of paid sites.This was very clear in the case of Simran farms .I prefer same treatment to all my readers and hence not in a hurry to repeat GTS.

    ReplyDelete
    Replies
    1. Your thinking is absolutely right in this regard. I propose to post the GTS after 3:30pm on Friday and answers everything on monday morning?

      Delete
    2. Great thinking, liked it very much.

      Delete
  32. Please let me know your view on Spanco ltd

    ReplyDelete
  33. Dear Sir,
    Let me first thank you for your excellent analysis and help to investors...I have been a regular reader of your blog and really like the same .What are your views on Thangamayil jewellery ?

    Regards,
    Rahul

    ReplyDelete
  34. Sir,
    Do you track venus remedies and sarda energy?

    ReplyDelete
  35. Dear Value Pick Sir,

    This decision of you not to repeat GTS is laudable and shows your genuine interest and positive contribution. Please keep it up.

    I would like to know your opinion on
    Allied Digital (ADSL).

    Thanks in Advance
    Arun Kumar from Hyderabad

    ReplyDelete
  36. Hello

    I just started reading your blog. You recommended Rossell India in January 2012. This is currently trading around 31-32.

    Shall I buy it in good quantities for medium to long term. Are you tracking it still..? Please suggest since I am just 23 years old and doesnot have much money to lose:)
    I have 25k for investing in equities. Please suggest where to put 25k. Would be great if you divide percent wise in different stocks. I dont expect any miracle out of it. If you would have 25k, think that ways.:D

    Thanks in advance sir.

    ReplyDelete
    Replies
    1. Risk element is always high in small/mid cap cos ,if you are not interested to take risk better to invest only in Blue chips.

      Delete
    2. Thanks for the reply sir. But I can take risk and that too at much higher since I am just 23 and I dont have any dependents as such. Suggest me that ways. Is rossell India still on your charts. Also, may be some other risky stocks you may bet on. I can take risk being 23.:) Risk is meant for youngsters like us I beleive.:D

      Delete
  37. Keep it up valuepick sir.
    U are one among the very few in the stock market who genuinely care for the investors.
    hats off
    senthil

    ReplyDelete
  38. Dear VP,

    Vis-a-vis KSB Pumps, what is your take on Kirloskar bros ? Both are competitors and Kirloskar has a greater market cap.
    Plz suggest.

    ReplyDelete
  39. Sir, I want invest any good transformer company ,can you sujest me any good company.I have allready BHARAT BIJLI at 615 rs.

    ReplyDelete
  40. Dear ValuePick,

    Wanted to know your current view on Rossell India. It was recommended by you @38, in Jan 2012. The CMP is @3. There hasn't been any upmove in this stock. What's your view?

    Thanks.

    ReplyDelete
    Replies
    1. CMP is Rs.32 not 3,no change in previous opinion

      Delete
    2. Hello Sir, sorry for the typo.
      Thanks for the reply! :)

      Delete
  41. Dear Sir,
    At what levels would you suggest to enter in Nilkamal & Repro India? Both are looking good form long term. What you says?

    ReplyDelete
    Replies
    1. Nilkamal is good even at current level for long term,Not tracking Repro

      Delete
  42. Dear VPji

    You didn't recommend to Buy Sequent Scientific.But reading between lines I understand what you mean.I know your target is above Kaveri Seed in this one.Anyway many many thanks for introducing a hidden gem like this .

    Your follower
    Manhar.

    ReplyDelete
    Replies
    1. Clearly mentioned in my previous posting that Sequent having many ingredients to become a multibagger and at the same time it is not suitable for those investors who are investing purely on the basis of ratios.

      Delete
  43. Dear vp sir,

    What is your opinion on smobility and transformers & rectifiers ?

    Regards
    Gopi

    ReplyDelete
  44. Dear VP JI

    Again same happened to KSB Pumps , after your posting the stock raised to 220. Shall we keep the target as per ur guidance and wait for some correction in price or may be it shoot up like sequent scintific...

    A great job by you for small investors..

    hats of for your value pick ups..


    regards,

    ReplyDelete
    Replies
    1. Dear Phani

      As in the case of you I don't know the answer for your question.Price level/correction depends on the nature of investors (short term/long term)entered in it.It is not practical to get an accurate answer for this.So try to value this company and buy below the rate arrived based on one's home work.

      Delete
  45. DEAR SIR,

    ONCE YOU RECOMMENDED EASTERN GASES & AS THE POLICY CHANGE HAS TAKEN PLACE DO YOU THINK ONE SHOULD BUY THIS

    ReplyDelete
  46. This is a very good pick.. i learning a lot from you sir. thanks :)

    ReplyDelete
  47. Hi VP,
    Can you please give me your views on AstraZeneca Pharma(my purchase @1720) and Jindal South West Holdings(my purchase @ 650) ?

    Is it good to continue holding them or switch to oriental carbon or sequent or KBS ?

    Eagerly waiting for your response :)

    Thanks

    ReplyDelete
  48. Dear Sir,
    Very Good analysis and learning given for small investors by you...what are your views on IDBI bank, and Navin Fluorine International Limited.

    Regards,
    Raj AS

    ReplyDelete
  49. Hi Sir,

    Whats your view on HINDALCO and WIPRO?
    i plan to invest in HINDALCO and Wipro with 3 year prespective ?

    PLease Advice

    ReplyDelete

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