Zicom – Secure And Be Sure

Zicom - To Bring Andheri Under Surveillance

Zicom Electronic Security Systems is all set to start its video monitoring station (VMS) at Andheri by August this year. This station is the first of its kind in India, which will allow a company to keep an eye on all the places coming under the surveillance of the company’s security products. “Our setup is ready and the station will start functioning within two months. Just the enrollment is being done,” said Manohar Bidaye, chairman, Zicom. He added that the station will be connected with all the Zicom products across the country. “From the station at Andheri, we will be able to monitor the offices and shops using our products,” he said. “We have invested Rs 18 crore in this station along with a central monitoring station (CMS),” said Bidaye. Both the stations will be located at Andheri.

For providing a surveillance facility, the rates charged by the company will differ from city to city. “In the metros, we will be charging Rs 500 per month, whereas in cities such as Ahmedabad, Hyderabad and Bangalore, it will be Rs 450 a month. And in the rest of India, we will charge Rs 400 per month,” said Santonu Choudhury, CEO, Zicom. He added that the facilities will be for all types of customers. “If any customer wants his home to be video-monitored we will have no problem. In that case, we assure that complete privacy will be maintained,” Choudhury added.

The company is getting inquiries from cities across the country among which, Mumbai and Delhi are at the top of the list followed by Chennai and Bangalore. “The customers can see the recording at our video station and this is attracting more customers. The system also gives out an alarm if any mishap happens,” he said.

Meanwhile, Zicom, which had recently announced its foray into retail chain outlets, is shortly going to inaugurate its first outlet in Chennai next week. The company plans to open 600 such outlets in the next three years with 200 outlets in the western region alone. The company has brought out two security products recently, ZICOMhome and ZICOMbusiness for the security needs of homes and business establishments.

Zicom offers a wide range of products including access control systems using keypad, proximity card and biometrics, as well as CCTV surveillance, which includes remote video surveillance, fire alarm systems, smart cards, perimeter protection system and law enforcement products.

Elder Pharma – Going Global Full Throttle

Elder Pharma - Targets Italian Generics Mart

After setting up a joint venture company in Nepal and a wholly owned marketing subsidiary in Ghana, the Saxenas-promoted Elder Pharmaceuticals is looking at similar opportunities in the Italian generics market. The company is scouting for marketing alliances and joint ventures in Italy, one of the largest pharmaceutical markets in Europe, as part of its global expansion strategy, said Alok Saxena, director - international business, Elder Pharma. “In order to tap the huge generics opportunity in Europe, we are looking at various options including marketing tie-ups, joint venture and even smaller acquisitions. However, all these are at a very preliminary stage and nothing has been shaped up into a final decision yet,” he said. According to sources, the company is currently in talks with a few leading marketing companies in Europe to form alliances or even joint ventures with local partners.

In March, Elder had set up a joint venture company with the Universal group, a diversified business group based in Kathmandu. Early this year, it had also established a direct sales and marketing subsidiary in Ghana. The Nepalese joint venture – called Universal Elder Pharmaceuticals – will start manufacturing drug formulations complying with the local market requirements. Elder holds 40 per cent and Universal 60 per cent in the company. Elder has invested Rs 10 crore in the joint venture.

The Rs 300 crore Elder had entered into a strategic alliance with the UK’s Medichem International to develop, manufacture and market advanced medical biosecurity products in India. Medichem is a leader in advanced medical disinfection products selling them in more than 40 countries around the world. Through this alliance, Elder would initially market a disinfectant spray developed by Medichem International, used as a precaution against getting infected with H5N1 avian flu virus. Branded as Trigene, the new disinfectant is certified by the department for environment food and rural affairs - the apex British government body for such products - as effective against bird flue viruses at normal user dilutions.

Global expansion is one of the growth strategies the company is aggressively looking at currently. Its growth plans are being aggressively pursued to achieve Rs 800 crore turnover by 2008.

GHCL - Acquires UK`s Rosebys For Rs 180 Cr

GHCL - World’s Only Integrated Home Textiles Company

GHCL today announced that it signed an agreement to acquire UK’s largest home textiles retailer, Rosebys, for $40 million (nearly Rs 180 crore). Rosebys has a presence in bedding, curtains and kids garments with over 300 retail outlets across the UK and an annual turnover of close to $250 million. It has over 2,000 employees.

Sanjay Dalmia, chairman, GHCL said, “The acquisition provides us an opportunity to leverage Rosebys’s established platform across the EU markets. It will be an ideal combination of low cost strong manufacturing base with a large established marketing platform to put us on the fast track growth”. The company will fund the acquisition through resources raised from domestic and foreign institutions in the recent past. The acquisition is likely to be completed in four months, after which GHCL would have a complete control over Rosebys’s operations.

Post acquisition, GHCL would become world’s only integrated home textiles company with presence across spinning, weaving, product design and development, sourcing and distribution to retail stores at a global level. In the textiles space, GHCL had acquired Dan River Inc, which is a leading player in the US textile markets with a turnover of $250 million in home textiles. It has a vast sales and distribution network within the US catering to largest retailers and preferred supplier to large retailers such as JC Penny and Linen & Things, Wal-mart, Bed, Bath & Beyond. With these acquisitions, GHCL is set to enter into the $40 billion US and UK markets, which account for the 60 per cent of the global home textiles trade.

GHCL is also expanding its capacity in spinning from 85,000 spindles to 140,000 spindles over 18 months. The company is in the process of completing its home textile manufacturing facility at Vapi at a cost of Rs.230 crore. The unit at 90 per cent capacity is likely to generate $100 million in revenues.

In the chemical’s space, GHCL’s subsidiary had earlier acquired a controlling stake in SC Bega Upsom in Romania. With these acquisitions, GHCL’s global capacity would be 18,00,000 MTPA from the current 600,000 MTPA.

-Business Standard

Jindal Stainless - Plans Overseas Acquisitions

Jindal Stainless - Eyes Units In Eastern Bloc Countries

Jindal Stainless is looking to acquire steel plants and mines abroad and enter into strategic tie-ups for raw materials and finished products in the next one year, said Arvind Parakh, director (finance), Jindal Stainless. The company also plans to float its first US subsidiary in the current financial year to March for trading operations. "We are working out strategic moves [including acquisitions and strategic tie-ups] to grow ...it could be a possibility in the next 6-12 months," said Parakh, adding, "we are looking actively into a few proposals, but its too early to talk [about them]," he said. The company needs access to raw material sources for chrome ore, coal, iron ore and manganese. "Our Orissa plant will give us hot-rolled steel, what we need is CR (cold rolled) plant and raw materials," he said.

Jindal has identified South East Asia and eastern bloc nations for possible acquisitions, he said. The company acquired a cold rolling unit in Indonesia in 2004 with a capacity of 50,000 tonne per annum (tpa). The unit is currently operating slightly below capacity. It has been facing difficulties due to high raw material prices. Parakh said the Indonesian unit should be able to make a small net profit in 2006-07. "We hope to improve performance [Indonesia unit] as the first quarter was good," he said.

Jindal Stainless will invest between Rs 1,500-1,800 crore in 2006-07 as capital expenditure towards brownfield and greenfield expansion at Orissa and Haryana. Of this, Rs 400-450 crore will be spent on expanding Hisar unit to 7,20,000 tonne of hot rolled capacity from 550,000 tonne now. Expansion worth Rs 1,000 crore is expected to be complete by March 2008. The remaining Rs 1,000-1,200 crore will be invested in the company's upcoming facility at Orissa. The Orissa unit, which will house a ferro chrome unit, coke oven plant and a captive power plant will cost Rs 3,200 crore.

Ferro chrome operations have already started while the other units will be operational by December 2007, he said. The company plans to borrow around Rs 400-500 crore from the markets to fund the expansion. Last year it borrowed Rs 1,100 crore. Besides setting up the US-based subsidiary, Jindal plans to start operations at its two other subsidiaries in UK and Dubai in the next six months. The company also plans more subsidiaries in Europe, which will report to the UK unit. These lower level units are likely to be in Italy and Russia, he said.

The company currently imports nickel and metal scrap from overseas. In India, the company has secured shareholder approval to hive off its architectural and lifestyle divisions into separate companies. The process of demerger is expected to be complete in 2007. "We expect 50-100 per cent growth in these units over the next five years," said Parakh. Jindal plans to list these units on the stock exchanges in the next 3-4 years after they have reached a "critical mass".

Jindal plans to increase production of stainless steel to over 600,000 tonne in 2006-07 from 5,48,000 tonne in 2005-06. The increase in output will come from capacity expansion at Hisar, which has touched 6,00,000 tonne during the March quarter. Parakh expects the company's topline to grow 15-20 per cent in 2006-07. Growth will be driven by volumes and better realisations, he said.

Stainless steel prices have moved up 27-30 per cent since April on the back of rising input costs. Parakh expects stainless steel prices to remain firm at the current levels in the near term on strong demand. Stainless steel is currently being sold at $1,100-1,200 per tonne. Jindal, India's largest stainless steel maker, is looking to sell its products through contracts ranging up to six months compared with the practice of selling through quarterly contracts. "Quantities will be fixed and prices flexible (in the new contracts)," he said. Flexibility on the price front will be advantageous to both customers and the company, as it will allow customers to "lock in" in a rising market and benefit the seller when prices start to fall, he said.

• Has secured shareholder nod for hiving off architectural and lifestyle divisions into separate companies. Demerger expected to be complete by 2007.
• The company is planning acquisition of steel plants, mines abroad.
• Jindal Stainless plans to set up more arms in Europe, mainly in Russia & Italy.
• Expects 15-20% growth in topline owing to better realisation and strong demand.

-Business Standard

Simplex Infra - Aiming Rs. 5000 Cr Turnover

Simplex Infra - Board Approves 5:1 Stock Split

Kolkata-based infrastructure development company Simplex Infrastructures Ltd is aiming a Rs 5,000 crore turnover over the next 4-5 years. To complement its growth plans the board of directors have decided to raise $200 million from domestic/ international market. B D Mundhra, chairman and managing director said, "The company aims to achieve a turnover of Rs 5,000 crore by 2011 and is constantly capitalising on untapped areas and opportunities in both organic and inorganic ways to drive the next level of growth."

In 2005-06, the company recorded net sales of Rs 1,345 crore. He added, "The board today has approved the proposal for raising $200 million from domestic/international market by issue of any class of securities including global depository receipts, American depository receipt, foreign currency convertible bond amongst others."

The board has also approved subdivision of existing shares of Rs 10 each into five shares of Rs 2 each, Mundhra added. The board has recommended the same for approval of the members at the ensuing annual general meeting.

Meanwhile, the current order book position of the company was above Rs 4,500 crore, said Mundhra. "Our order book, which is over Rs 4,500 crore, is not only growing in terms of quantity but quality as well and we are executing some large projects across diverse sectors in India & international markets," he explained. The company is also planning to bid for build operate transfer (BOT) projects/ annuity projects in roads & highways, power transmission, ports, hydro, railways and water supply.

"We are also targeting turnkey, operation and maintenance project in metal, cement, oil and gas pipelines," he noted. Simplex Infrastructures led consortium has emerged as a leading bidder for the Rs 250 crore stadium deal from the Jharkhand government. Senior executives of Simplex confirmed that it had bid for two stadiums at Ranchi in association with the UK-based construction firm Laing O' Rourke. The deal is likely to conclude this week.

In addition, it is bidding for a handful of contracts in North Africa for industrial construction, roads and power projects. The combined value for these contracts stands at Rs 500 crore. Simplex has tied up with US-based developer Heins for bidding for developing 350 acre of residential-cum-commercial complex in West Bengal. For funding its growth plan, the company will raise Rs 900 crore from the domestic as well as foreign markets. Simplex is also planning to tie-up with national and international majors for entering into mining sector.

Meanwhile, Simplex Infrastructures registered a jump of 65.4 per cent net profit at Rs 42 crore during 2005-06 against Rs 25 crore in 2004-05. Total income from operations grew to Rs 1,345 crore during 2005-06 against Rs 999 crore in the previous fiscal. The company has recommended a dividend of Rs five per share on face value of Rs 10 each for the year ended March 31, 2006.

Viceroy Hotels - Expanding South

Viceroy Hotels - Collabrating With Marriott International

Having embarked on a major expansion of its hospitality business in south India, the Hyderabad-based Viceroy Hotels Ltd plans to raise another loan of Rs 56 crore to part-finance its expansion plans. The hotel company, which had already raised Rs 56 crore as part of its Rs 112 crore debt-finance plans, on Monday decided to approach the SBI and Canara Bank to raise another loan of Rs 56 crore to develop its Bangalore property.

The 250-room Bangalore hotel, which will also be managed by Marriott International Inc under the Renaissance brand, will require a total investment of Rs 160 crore. Viceroy Hotels raised the first tranche of Rs 56 crore from State Bank of Mysore and State Bank of Indore Ltd. K Narsimha Rao, director of finance for Viceroy Hotels, said that the loans were for a long-term period of 12 years. “The amount will be split equally between the two banks (SBI and Canara),” said Rao.

This is expected to happen in another 30 days. The company has already raised the Rs 460 crore it requires for a hotel project in Chennai. This five-star luxury property, with a total of 550 keys, will be a combination of JW Marriott with 350 rooms and a 200-room Marriott Executive Apartments. Located at MRC Nagar next to the Leela Palace project in Chennai, work on this hotel will be completed by December 2009.

The SBI, the State Bank of Mysore and the State Bank of Indore would extend most of the Rs 300 crore debt required for the project, while Rakesh Jhunjhunwala, and Sonata Investments, part from the original promoters of the Viceroy Hotels, would invest Rs 160 crore. Besides, two other hotels will be set up under Marriott’s economy hotel brand, Courtyard, in Visakhapatnam and Hyderabad.

Simpex Infra - Foraying Into Real Estate

Simplex Infra - Considering Stock Split

Simplex Infrastructure is considering a stock split. Director at Simplex Infrastructure, Amitabh Mundhra, says we are strategically pursuing both in terms of buying land ourselves and in terms of forming a JV with land owner or real estate developer. There biggest revenue grosser is power with 30% contribution. They hope to raise around USD 200 million. According to him, there is a encourging scenario emerging out of real estate forays.

Excerpts from CNBC-TV18's exclusive interview with Amitabh Mundhra:

Q: How much money you are looking to raise and what will those funds be used for?

A: The reason, why we are meeting is to announce our annual results and take these resolutions on stocks split and fund raising. The growth that is happening is beyond expectations. Particularly, there is interesting scenario emerging out of the real estate space and the acquisition space. At some point in time, during the course of the year, we would need funds to go ahead in these areas that, we are actively perusing right now. I think we are taking our resolutions about raising USD 200 million. The quantum will only depend on how the future unfolds for us.

Q: What about your foray into real estate. Do you own land or are you in talk with joint ventures? How would you approach this real estate foray?

A: The current trend has started three-four years ago, when we started getting into construction of top class building and malls. At present Simplex is a company, which is constructing almost 15 million square feet of residential, commercial and other IT, spaces not only in India but also overseas areas. There is a great demand for us to get involved as part of the real estate space also. A lot of developers find that acquisition of land and retailing is there but, when it comes to construction and infrastructure designing, we actually have a hedge. With our expertise and experience gathered over the last few years this is a space, we should actively look into and which we will.

Q: Do you have real estate as part of Simplex Infrastructure in any part of the country?

A: Not as of now, but we are actively pursuing this area. We are strategically pursuing both in terms of buying land ourselves and in terms of forming a jv with land owner or real estate developer.

Q: What sort of an order book are you sitting on?

A: Currently, we are sitting on an order book size of about Rs 4500 crore. The relevant point here is not the size of the order book but the variety of order book .It is fairly easy to go and book orders at this point in time. We are constantly trying to endure our risk to see that the spectrum of order book improves. We are cherry picking the right projects. Recently, we have bagged two stadiums in Ranchi. In few days, we will be bagging few other orders in interesting spaces, which would open new arenas for the company.

Q: Could you give us a break-up in terms of how much of this would constitutes into your power segment, road segment, building and housing?

A: We actually operate out of 6-7 broad segments. Power being one of them. Ground engineering and piling, which was earlier our core sector. Industrial construction and marine, housing and urban infrastructure and transportation, which includes roads and railways. The biggest revenue grosser for us is power, which is about 30%. The rest if it is evenly divided. No sector gives us more than 20% and less than 10%. So it is a very healthy mix.

SREI Infra - Venturing Into Housing Finance

Srei To Buy Out Peerless Abasan

Kolkata-based Srei group, one of the leading players in the country in infrastructure finance, is entering the housing finance sector. The group is acquiring Peerless Abasan Finance Ltd, the housing finance arm of Peerless Finance & Investment Company, one of the biggest NBFCs in India.

Sources in the housing finance industry said that the Srei group would acquire Peerless Abasan through Shristi Infrastructure Development Corporation Ltd (SIDCL). When contacted, the managing director of Peerless, S K Roy, said the group had entered into an agreement with Srei for Peerless Abasan. SIDCL is the housing and infrastructure development arm of Srei. SIDCL is engaged in developing townships, malls, housing and other physical infrastructure in West Bengal and other states in eastern region.

"This will mark the exit of Peerless group from the housing finance sector. In contrast, Srei will enter into the retail as well as institutional housing finance sector," said sources. Another leading NBFC player in the country Sahara has already floated a housing finance company called Sahara Housing Finance Ltd. According to sources, after the acquisition, Srei would reorganise the capital of the company. "Swap ratio of 2:1 i.e. 2 equity shares of Rs 10 each in the Company for every 1 equity share of Rs 10 each in Shristi Infrastructure Development Corporation Ltd has been proposed," added sources.

According to sources, Peerless Abasan has a networth of Rs 20 crore and a loan portfolio of around Rs 10-15 crore. The Peerless group used to have around 49 per cent stake in Peerless Abasan. The entry of Srei group into housing finance would complete its finance portfolio. The group currently has a presence in venture capital, merchant banking and stock broking along with infrastructure finance and leasing.

IVRCL - Outperformer

IVRCL reported excellent results for Q4FY06 as also for the full year 2006. For the full year, revenues grew by 44%, operating margins improved by 60 basis points (bps) and profits grew by 64%. This was in line with my estimates. I am upgrading my estimates and recommend BUY with a price target of Rs. 305 taking into consideration full conversion of FCCBs, providing an upside of 27% from current levels.

KEY HIGHLIGHTS OF THE RESULTS

Excellent growth in revenues…

For Q4FY06, the company's revenues grew by 73% driven by a very good order book. For the full year, revenues grew by 44%. The company has an order book of Rs. 62 bn to be executed in the next two years, which would result in a higher growth in revenues in FY07 and FY08. Moreover, it is also expected to end the financial year with an order book of Rs. 85 bn.

and improvement in operating profit margin…

Operating margins of IVRCL have shown an improvement of 60 bps for the full year FY06 vis-à-vis FY05 led by selective bidding for projects, variable pricing clause and shift towards higher margin segments such as power. The company is also expected to improve these margins by 25 to 50 bps owing to higher contribution of power and irrigation projects and with the setting up of a steel fabrication unit, which would become operational in Q4FY07.

… leading to significant growth in profits

Profits for the full year have grown by 64% driven by an excellent growth in revenues and improvement in operating margins. For Q4FY06, profits grew by 74% resulting in net profit margins of 7.3%. For the full year, net profit margins stood at 6.1% and the company is confident of maintaining margins these levels.

Subsidiaries showing decent performance

The company's subsidiaries IVRCL Prime Urban Developers (IPUD) and Hindustan Dorr Oliver Ltd (HDOL) have also performed decently. HDOL has shown revenue growth in line with our estimates and a higher growth in profits vis-à-vis FY05. IPUD has also recorded revenues of Rs. 1.36 bn vis-à-vis Rs 218 mn last year. It isalso expecting a significant improvement in the netprofit margins owing to higher price realizations for its flats. The company is also coming up with a state-of-theart mall and IT park at Gachibowli, Hyderabad and has also obtained an approval for raising capital.

Future growth areas

The water segment would continue to be around 50-55% of the company's order book and with the growing size of power-related projects, the company would be able to improve its operating margins. It currently has sufficient funds and internal accruals to take care of its current order book but it would have to go for a GDR issue if it bags a few more large sized BOT projects in water or road segment. The company has already obtained an approval for raising approx $125 m.

Punj Lloyd - Buys 88% In Sembcorp Arm

Punj Lloyd - Engineering Major

Engineering and construction major Punj Lloyd Ltd has acquired 88 per cent stake in Singapore-based SembCorp Engineers and Constructors (Semb E&C) for Rs 102.6 crore. The acquisition was done through its Singapore subsidiary, Punj Lloyd Pte Ltd. Semb E&C is a wholly owned subsidiary of Singapore based utility group Sembcorp Industries. The remaining 12 per cent in Semb E&C will be acquired by December 2007, a company release said. "The acquisition will help our group access new geographies and enhance our competitive positioning in existing markets. It will enhance our capabilities to tap into complementary growth sectors such as infrastructure and petrochemicals," Atul Punj, chairman and managing director, Punj Lloyd, said. The acquisition will expand the company's operations to Europe and China, besides Iran and other Southeast Asian markets.

In addition, the deal will also enable the company to enter several new areas, including airport construction, jetties, tunnelling and sewerage. Semb E&C will add petrochemical Punj Lloyd's portfolio. "In the petrochemical sector, Punj Lloyd can leverage Simon Carves' expertise in engineering, procurement and construction of PVC, styrene and refinery processes domain," the release said. PricewaterhouseCoopers Singapore acted as advisors to the transaction.

At present, Punj Lloyd provides engineering construction services in the oil and gas sector for pipelines, tanks and terminals, process facilities, and in the infrastructure sector for construction of highways and expressways, power plants and high specification buildings besides value added engineering and plant and facility maintenance. SembCorp Industries has operations throughout Southeast Asia, China, India, UK, West Asia and Russia. It is Southeast Asia's largest engineering and construction company outside Japan, China and Korea with experience spanning across more than 35 countries. Semb E&C has more than 1,640 employees worldwide, including 650 design professionals.

Adlabs - Slow And Steady

Adlabs Lines Up Rs 60 cr Saurashtra Spread

Anil Ambani-controlled Adlabs Films has decided to invest Rs 60 crore for acquisitions of multiplexes as well as single-screen theatres in the Saurashtra region. As per its plan to invest Rs 200 crore in three years to acquire 300 screens across the country, Adlabs has entered into a deal with film-maker and exhibitor Mehul Kumar to develop or acquire cinemas in Saurashtra. These theatres will be managed by Adlabs in association with Kumar. The first of these acquisitions is a three-screen multiplex Mehul Cinemax at Jamnagar. This multiplex will now be re-christened as Mehul Adlabs.

Other locations targeted include Bhavnagar, Gandhidham, Rajkot, Bhuj and Junagadh. According to market sources, Adlabs is going to set up 15-16 screens in the Saurashtra territory at an investment of about Rs 4 crore per screen. Kapil Bagla, head of corporate strategy and acquisitions, Adlabs Films, said, "Saurashtra is an important territory for Hindi films, having sizeable box-office collections. Consequently, Adlabs will complete its exhibition presence in the entire distribution circuit of Saurashtra." With tax rates being brought down from 30 per cent to 20 per cent last month, the Saurashtra region will be provide good returns to exhibitors.

The company's strategy is to enter B-class cities via acquisition of existing cinemas as well as constructing new cinemas to offer cheaper viewing opportunity to its audience. The rationale is that Adlabs through its pan-India presence in the exhibition space will be able to effectively release a film either produced or procured by it. So, while in the metros and major cities, the films will be screened in both Adlabs multiplexes as well as others, in smaller cities these will be screened only in Adlabs theatres. Experts also point out that once Adlabs has a large network of theatres, it will be possible for the group to digitally transmit a movie from one centralised location to all the theatres through Reliance Infocomm's existing fibre optic network.

Adlabs has made an array of acquisitions of late, including some prime single-screen theatres in Mumbai such as Novelty and Sterling. The chain will also be soon opening one of its flagship properties, Metro Adlabs, in south Mumbai which will be the rechristened version of the Metro theatre.

SREI Infra - Motilal Report

SREI Infra - Also Recommended By Motilal Oswal

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REI Agro - Going West

REI Agro - Eyes West Bengal `Gobindobhog` Rice Market

REI Agro Limited plans to foray into the 'gobindobhog' rice market in West Bengal and has commissioned a feasibility study on the market size. The company is also strengthening its distribution channel and increasing capacity to make basmati an everyday affair in Indian homes. In addition, REI is setting up a six megawatt wind farm in Tamil Nadu and looking for another 25 megawatt installation in Karnataka.

REI had 15 per cent market share of the Indian basmati market, but only seven per cent of revenues come from the eastern region. To strengthen its position in the basmati trade in eastern India, it was strengthening its distributor network in the region, which had 40-odd distributors now out of the total number of 435. "Since gobindobhog is a popular fragranced rice variety here, we are planning a processing plant here in West Bengal", said Sundip Jhunjhunwaala, vice-chairman and managing director of the company. N K Gupta, technical consultant and director of the company, was conducting a feasibility study for the 'gobindobhog' project. If set up, procurement of raw material would be done from regions in and around West Bengal as it was not feasible to transport raw material from other regions for rice, said Jhunjhunwaala. The study was expected to be completed within two months. Since 90 per cent of the company's products was sold through small retailers, REI would be concentrating on selling its product through them. Only 3.5 per cent of the company's branded sales were made through consumer packets - the rest was sold from sacks at stores. The company would be increasing output capacity from the existing 49 tonnes per hour to 61 tonnes per hour at its plant in Bawal in Haryana.

REI expected to increase its exports by 25 per cent. The revenue generated from exports was 15 per cent of the total turnover last year, he said. REI sold 265,000 metric tonnes basmati rice in 2005-2006 and clocked a growth of 14 per cent. The company expected topline growth of 25 per cent this year. The bottomline growth last year was 75 per cent, up from Rs 37.85 crore in 200-2005 to Rs 66 crore in 2005-2006. A significant contributor to the company's revenues was its wind-turbine based power generation division. "During the last financial year, the company sold power worth Rs 15 crore to the state electricity boards. This year, sales should be Rs 25 crore of power from the existing capacity of 29.9 megawatt", he pointed out.

REI Agro is a good Long Term Bet and is also recommended by Religare & Kotak. To download Religare Report Click Here.

Greenply - Excellent Results

Greenply Reports Four-Fold Increase In Net Profit

Greenply Industries Ltd today reported a four-fold increase in its net profit for the quater ended March 31 at Rs 376.85 crore as against Rs 86.85 crore in the same period previous fiscal. The company's revenue for the quarter under review surged 89 per cent at Rs 80.93 crore as compared to Rs 42.76 crore in Q4 FY 2004-05, a company statement said. For the year ended March 31, Greenply's net profit surged 167 per cent to Rs 1,408.5 crore from Rs 528.01 crore posted in the previous fiscal.

The company's revenue grew 64 per cent jump in its revenue at Rs 308.22 crore as against Rs 188.40 crore in the previous fiscal. "We have been able to improve the margins through a blend of higher capacity utilisations, change in product mix, improved marketing distribution, better brand recall and buoyancy in the market," greenply Joint Managing Director Saurabh Mittal said.