Saturday, June 29, 2013

ASTRA MICROWAVE PRODUCTS LTD - A NICHE PLAYER IN DEFENCE SECTOR





 
Astra Microwave product offering a good investment opportunity in the less penetrated defence sector by private sector companies.This Hyderabad based company is one of the very few listed players concentrating in this sector.Company manufacturing various Radio Frequency and Microwave based products for  sectors like Defence,Telecom,Space..etc.Its product list includes different  types of Radars,Modulators,Transmitters and Amplifiers.It is a one of the very few reliable Indian suppliers of such products to Public sector companies operating in defense and space  sector in India  like BEL and ISRO. Using their strong R&D AMP indigenously developed and supplied  many critical parts of  India’s first  radar Imaging Satellite (RISAT-1) which launched in 2012. Company also having strong business relations with overseas defence and space sector players. AMPL is working on a wide variety of important and high-tech defence projects such as Airborne Early Warning and Control (AEW&C) programme of DRDO, various ground and air-based radar programmes for Indian armed forces, sub-systems for Akash and Astra missiles, and Unmanned Aerial Vehicles (UAVs) like Nishant and Rustom.

Companies strong relations with ISRO and DRDO as a reliable supplier in a quality quotient industry creates a niche status for this company.Last year company received one high value order worth Rs.350 Cr from an overseas customer for supply of microwave sub systems.In fact it is one of the largest orders placed by a foreign company to an Indian private sector company in defence sector.We can take it as a testimony for the quality of the products supplied by AMP.

                                                                                Indian defence sector is expected to open up for private sector players in a big way going forward.Companies like L&T ,Mahindra..etc are scouting plans to tap the upcoming opportunities in this sector.With less than 25% promoter stake AMP is really a potential take over target for any serious player in this sector. In the past many rumors are there in the market connected with a possible take over by L&T,Mahindra ,BEL ..etc. L&T already acquired close to 10 % stake in AMP. Presence of some private equity investors and mutual funds makes it vulnerable as an easy take over target .One such investor is reducing their stake through open market sales but on  the other side ,promoters are very aggressively hiking their stake in past few weeks through open market purchases.Whether there is a take over in future or not ,there is nothing much  to loose at CMP of Rs.35.Company having very good order book position of Rs.1025 cr  which is almost 5 times of  company’s last year turnover.Such kind of a visibility is very rare in these days of recession. I hope ,share price will move to the next orbit once the supply from this single source ends .Recommending a BUY at CMP of Rs.35 with a long term view.Stock listed both in NSE and BSE


Link to company Website HERE

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21 comments :

  1. Sir,
    Unable to user search option to see your old recommendations as the stock names are not showing up on right side as it use to earlier.

    Can you please check and see if company names can show on right side?

    A small suggestion from your follower.

    ReplyDelete
  2. Please use the search option available at the top left corner,till the old format replaced.

    ReplyDelete
  3. Dear Sir,

    I had invested in Parekh Aluminex an year ago looking at their dividend pauouts & past history. Since then the stock has come down like anything. Reasons stated are the promoter (who died recently) had pledged his shares to a financial firm, the financial books were cooked etc. Now as per today's picture, the promoter share is mere 19%. The company is not coming out with any public statements to assure the investors of it's current status or future plans of revival. The market cap is mere 54 crores with huge debt on the books. Do you think the company suffers from a man made problem ? Is it a serious case of corporate fraud (I am contemplating approaching Scores.Gov @ Sebi with a complaint)? Can it revive from here ?

    Thanks

    -Shree

    ReplyDelete
  4. Sir, on one side Strategic Venture fund has been selling, while on the other side the manager of the fund made purchase of 25,000 shares of Astra Microwave. It's strage, maybe after your research, he's realizing the value of investments in the company:)

    ReplyDelete
  5. I think you are referring the buying of shares by Mr Atim Kabra.What you said is right- the fund is selling and the MD of the company which manageing this fund is personally buying from open market.Normally the funds may be raised by the firm from other investors too and they may have obligations to give returns to them by realising the profit .This may be the reason.During march quarter alone he increased his stake from 1.10 % to 2.40%

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  6. Dear sir
    What is your opinion on monsanto
    Regards
    Atanu

    ReplyDelete
    Replies
    1. I Prefer Kaveri Seed from Agri Inputs space.Monsanto may see some more up move backed by good monsoon.But they are promoting all their new products through an unlisted company directly held by their foreign parent .I don't think this policy is good for the share holders of listed entity.

      Delete
  7. Dear vp sir,

    Your suggestions on Orient bell, Bambino, denora, whether to book loss or hold for some more period to get some clarity, until this pca gets suspended. Thanks for your initiation agains pca.

    ReplyDelete
    Replies
    1. Positive on the business prospects but concerned about the low liquidity created by PCA

      Delete
  8. Dear sir,

    Your views on J&K Bank..

    ReplyDelete
  9. Dear sir,

    Marksans Pharma doubled, shall i sell or hold?

    ReplyDelete
  10. Dear VP Sir,

    Thanks for suggesting various dimensional stocks, but your disclaimer of vested interest is missing in this Astra can i know why?, my second question is I am very much greatful for suggesting Marksans pharma- where i achieved 100% profit, now what do u suggest, whether to hold or sell, because i have VA tech, mangalam cement, orient bell & granules where i had lost almost 50% of my money there, but still holding. kindly suggest what to do sir.

    ReplyDelete
  11. VP sir,

    Marksans Pharma is making a 112.99% profit in my portfolio, Kindly suggest whether to hold or book profit now itself. I have 3000 shares, i bought only through your recommendation thanks a lot for that.

    ReplyDelete
  12. Sir, what do you think about Titagarh Wagons for the long term?

    ReplyDelete
  13. What abt Basant Agro Tech? The stock is not moving either up or down? Can I HOLD or SELL?

    ReplyDelete
    Replies
    1. Promoters started buying from open market .Good monsoon is another positive factor.Not seeing any downside risk.Chances are there for re-rating if promoters are willing for a de-merger of seed div.

      Delete
  14. Sir, what is your view on morepens lab

    ReplyDelete
  15. Marksans Pharma is making a 150% profit in my portfolio, Kindly suggest whether to hold or book profit now itself. I have XXXXXX no. of shares, i bought only through your recommendation thanks a lot for that.

    ReplyDelete
  16. VP sir,

    Marksans Pharma is making a 150% profit in my portfolio, Kindly suggest whether to hold or book profit now itself. I have xxxxxx no. of shares, i bought only through your recommendation thanks a lot for that.

    ReplyDelete

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