Here's some input about the company which I have been recommending to my Paid as well as free members. Some important developments are taking place within the company (will be disclosed to PAID MEMBERS only) which should give a great boost and shoot up the share prices.
Kalindee Rail Nirman (KRNL) has reported its Q1FY09 results better than their expectations. Net sales increased by 24% YoY to Rs 595 million, lower than the expectations of Rs 643 million. Q1FY09, EBITDA margins were better at 13.4% since company has reported low margins at 7.7% in Q4FY08. In Q4FY08, prices of various commodities (mainly steel) has increased significantly and because of escalation clause in few projects, this increase in expenditure got reimbursed in Q1FY09 and hence margins were significantly high in Q1FY09. The company expects margins to be in range of 11-12% in subsequent quarters. Kalindee Rail Nirman has current order book of Rs 4 billion. Maximum part of this order book (approximately 80%) is expected to be completed by March 2009. The company expects orders worth Rs 6-7 billion by the end of December 2008. It largely comprises of orders from Bangalore Metro, Mumbai metro, regular projects from Northern railways and other private players like Vedanta etc. It has fund raising plans, to meet working capital requirement for new orders. This is likely to be completed by December 2008 but management is not willing to reduce its holding which is approx 26% at present. Debt on balance sheet at present is approx Rs 600 million.
Sources expect KRNL to report net revenues of Rs 4.1 billion and PAT of Rs 263 million in FY09E and net revenues of Rs 7.3 billion and PAT of Rs 514 million in FY10E. EPS works out at Rs 20.4 for FY09E and Rs 40.4 for FY10E. At present, the stock trades at 10.5x and 5.3x FY09E and FY10E earnings, respectively. Its a Great Buy at CMP Rs 196/-.
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