JAI HIND PROJECTS is small cap stock with very good potential for growth and is useful for long term investment. The company is based in Ahmedabad and doing construction works like underground pipe laying and corrsion coating for industrial projects.The current market price of the scrip is Rs.113.10. The financials for the company for last 4 years are as below:
figures in rs crores FY 2011 FY2010 FY2009 FY 2008
(unaudited)
Income 438.39 409.92 239.47 74.75
Net Profit 25.80 24.66 13.28 6.30
Share Capital 13.41 7.26 7.11 7.11
Reserves & Surplus 97.22 71.42 47.75 33.30
Total Debt -not av- 296.77 152.64 98.77
Market capitalisation of the company is Rs.82.08 crores and PE ratio is 3.18. TheCAGR of earlier years is attractive except for FY2011 and there company is expecting very big foreign project. The less growth in 2010-11 is due to delay in certain crucial projects and are in negotiating big foreign project and expect to do good business in FY12. The market price of share has fallen by 60% due to low capital base and heavy debt. Moreover the shares of the promoters are pledged for getting loans for the project. The nature of the activity requires huge cash flows and hence debt is high. However the type of projects is profit oriented and growth potential is very good and can hope for bonus to be declared in near future.
Inspite of some weakness as above, the shares of the company will rise sharply rise over a period of 2 to 3 years horizon and the share prices are attractive at present and can be accumulated at every decline for long term value.
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