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Wednesday, June 11, 2008

Stock Analysis - TUBE INVESTMENTS OF INDIA

TUBE INVESTMENTS OF INDIA : BSE CODE 504973

Tube Investments of India Ltd. (TI) belongs to the nearly 8500 crore p.a. turnover Murugappa Group of Tamil Nadu. The other group companies are Parry Agro, Carborandum Universal etc.

TI has got many areas of operations with works/factories in various places.

1. TI CYCLES :
TI Cycles of India, one of the leading bicycle manufacturers in India, started in 1949, has been at the forefront of innovations and is a pioneer in the market of cycles. TI cycles are the makers of country’s most famous brands like Hercules, BSA and Philips cycles


Brands:
HERCULES - the flag ship brand of TI cycles portfolio, this brand of ours is still as young as ever. Hercules stands for a unique pride of possession - anchored in the time-tested values of heroism and integrity, to which the brand’s customers subscribe in their own lives.


BSA - Another Flagship Brand of TI cycles, BSA stands for Birmingham Small Arms. It signifies the joy of cycling; fun and comfort go hand in hand with BSA. BSA today is an intrinsic part of the Indian family with cycles for everyone - kids, teens and adults.


Certificates: Certified with ISO 9002 and ISO 14001.
Exports: TI Cycles is an exporter to many regions across the global - Europe, South East Asia and Africa; being some of them.
Locations: Chennai (Corporate HO), Nashik, Noida, Durgapur, Bangalore, Kolkatta, Patna and Ludhiana.

2. TUBE PRODUCTS OF INDIA
Tube Products of India is an undisputed leader in the Indian market for precision Welded ERW and CDW steel Tubes with the widest variety and also manufactures wide range of CRCA (Cold Rolled Closed Annealed) Strips catering to international standards
Products
Precision Tubes
Market leader in Telescopic Front Fork Inner tubes and Cylinder bore tubes for shock absorber and gas spring applications.


Propeller shaft tubes for Automotive segment.
Other Speciality products include Rear Axle Tubes, Side Impact Beams, Tie Rods, Drag links. Heavy thick steering shafts and Hydraulic Cylinder tubes


CRCA Strips
A wide range of CRCA strips including special extra deep drawing, high tensile, medium carbon, high carbon finding application in industries such as Bearings, Automobile, Auto Ancillaries and General Engineering.

Locations
Plants : Chennai (South India), Shirwal (Western India) & Mohali (Northern India)


3. TIDC
TIDC is one of India’s leading manufacturer of power transmission chains for the industrial, automotive and agricultural segment and is part of the $ 1.6 Billion Murugappa group. TIDC India was established in 1960 in collaboration with Diamond Chain Co USA and today is the undisputed market leader in both the industrial and automotive chains. The company made a foray into Fine Blanking in line with its vision of becoming a prominent global player in power transmission components and is now a major supplier of FB components to the automotive industry. Currently about 45% of our turnover is from exports and this is an indication about our growing global presence.


I) Product Range
Industrial
· Power Transmission Chains - ANSI & British standards
· Engineering Class Chains
· Agricultural Chains
Automotive
· Drive and Cam chains for Motorcycles
· Timing Chains
· Sprockets
Fine Blanking
Transmission & engine parts for 4 wheeler & 2 wheelers
II) Plant Locations
· Chennai - Industrial chains & Fine Blanking
· Hyderabad- Automotive Chains

4. METAL FORMING
Market position: Pioneers in cold roll forming. Leading manufacturer of roll formed car doorframes with 65% market share in India.


Products: Car doorframes, window channels, SS Rail, impact beams, chassis channels, frames for starter motor (deep drawn) and other roll formed sections for railway wagons and coaches.


Customers: Hyundai Motors India, Maruti Udyog Limited (Suzuki affiliate), General Motors India, Visteon India.
Locations: Chennai (South India), Bawal (North India), Halol (Western India).


SHARE CAPITAL
The company has got a share capital of 36.95 crores made up of 18.47 crore equity shares of Rs.2.00 each. The company has got substantial reserves of Rs.681 Crores, thus commanding a book value of almost Rs.39.00 per share on a face value of Rs.2.00.


Almost 42 percent of the shares are held by the promoter group and about 12 % are held by institutions like Mutual Funds, LIC etc.


The company is showing increased sales turnover (over Rs.1700 Crores in 2007-08). A good portion of its income is derived from export operations. With the appreciation of dollar, the income for the coming year is expected to be good.


The company issued bonus shares of 1:1 in 2004 and subsequently split its shares from Rs.10.00 FV to Rs.2.00 FV. In 2006. Even now it is a good bonus candidate.


Considering the good parentage, strong reserves/book value and expected increased incremental cash flows, conservative investors can consider buying shares of Tube Investments of India Ltd. at the current price of around 47 (which is almost at 52 weeks low). The share price showed a 52 week high of about Rs.97.00. It is quite reasonable to expect a return of 25 to 30 percent in one year in this share.


Disclaimer: This report has been prepared solely for information purposes and the investment is the sole decision of the investor. Such information is impersonal and is not an inducement to invest. The information contained herein has been obtained from sources believed to be reliable and author , accepts no responsibility for the accuracy of its contents. Investors are advised to satisfy themselves fully before making any investments or committing themselves and should consult their own financial consultants whether and how to use such information in making any investment decision. The author accepts no liability arising out of use of the above information/ article.

Source: kashiwala.blogspot

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