Power My Portfolio Value Pick: Skipper Ltd

Incorporated in 1981, Limited is the Flagship company of the S.K. Bansal Group. Its Major Business in Transmission Towers & PoleSkipper s, Tubular Poles, Monopoles, PVC / CPVC Pipes & Fittings, Solar Structures.Skipper’s market reach spans across 30 countries around the globe from South America, Europe, Africa, the Middle East, South and Southeast Asia and Australia.

Key Facts:

  • Largest manufacturer of Transmission & Distribution  structures in India and among top 10 globally.
  • Largest producer of Plastic Pipes & Fittings in West Bengal, the fastest growing and second largest in Eastern India.
  • 8 manufacturing plants located across India.
  • 75% of our manufacturing is carried out using Automated CNC lines
  • Technological tie-up with two of the world’s most renowned companies Sekisui of Japan for CPVC compound and Wavin Group of The Netherlands for advanced plumbing solutions.
  • Emerge among the top five PVC pipe makers of India.
  • The Company’s Polymer Product Segment has a manufacturing capacity of 51,000 MTPA.
  • T&D Segment has a manufacturing 230,000 MTPA in FY17.
  • Company has good consistent profit growth of 62.71% over 5 years
  • Order Intake of INR 432 cr in Q2 FY’18
  • Net Sales: INR 515.62 cr in Q2FY18 against INR 390.81 cr in the previous year quarter, up by 31.9%
  • Company has a good return on equity (ROE) track record: 3 Years ROE 28.60%
  • Clients from high-growth sectors such as Power Transmission, Telecommunication, infrastructure, irrigation and construction sectors.

Stock Outlook:

  • M-cap: INR 2723 cr
  • CMP: 266 INR (15th Dec 2017)
  • PE: 23.8
  • EPS: 11.17 INR
  • Book Value: 47.9 INR
  • Share capital is 10.23 cr of FV 1.
  • Promoter Share holding is 70.41%
  • FII/DII/FPI Share holding 10.09 %.

Why Skipper ?

  • Global T&D sector is projected to attract investment of over $1trillion over the next 5-6 years. And Skipper is One of the lowest cost producer of transmission tower in the world
  • The government thrust on water, irrigation, improving sanitation, urbanization, the pvc pipes and fittings market to grow at a much faster pace.
  • Recently commissioned Guwahati plant (unit 2)to cater nationwide Polymer fittings requirement.
  •  Company aims to double its polymer capacity to 100,000 MTPA
  • Entered in JV with Metzerplas, which is one of the largest and most specialized manufacturers of Drip Irrigation Solutions from Israel.
  • The Company’s newly built Guwahati plant having a capacity of 30,000 MT per annum for engineering products got approval from Power Grid Corporation of India Limited for supply of Galvanised Tower Structures/ Parts.
  • Govt’s  projects like  24/7 Power for All by 2019 , Ujjwal Discom Assurance Yojna, Housing For All will be key demand driver for company.
  • Skipper is the major beneficiary of Bharat Growth story.
  • In next 3-5 year stock can deliver 3x-5x returns.

Be Smart. Invest Smartly.

Disclaimer : Please take advice of your financial advisor before any investment.

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