MIC Electronics Allotment Status
Tuesday, May 22, 2007
The allotment status of recently closed IPO of Mice Electronics is available online. You may check the allotment status here. The Grey market Premium is Rs 35. Good Luck to all the allotees!.
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Published by DalalStreet Business @ 10:01 PM IST.
Nitin Fire Protection Oversubscribes 48 times
Saturday, May 19, 2007
The IPO of Nitin Fire Protection Industries for which we had a subscribe recommendation was oversubscribed 48.48 times. Here is the breakup of subscription that we have obtained from the National Stock Exchange.
Institutional Quota was oversubscribed by 49.9106 times
High Networth Individual Quota was subscribed by 101.32 times
Retail Individual Investors Quota was subscribed by 30.297 times
All retail applications for 1 Lakh will be allotted in the ratio of 1:2. Grey Market Premium is Rs 45 as of Saturday. Good Luck!
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Published by DalalStreet Business @ 8:39 PM IST.
Nitin Fire Protection Industries
Friday, May 18, 2007
Nitin Fire Protection Industries, promoted by Nitin M Shah alias Sanghavi, was incorporated to manufacture fire extinguishers. The company presently provides fire protection, and safety and security by offering end-to-end turnkey solutions. This business is carried through two wholly owned subsidiaries and one partnership concern.
The other business of high-pressure seamless cylinders is presently carried through wholly owned subsidiary Eurotech Corporation, which outsources the manufacture of these cylinders to China. CNG gases are transported to CNG stations through CNG cascades. The company also manufactures these cascades.
Recently, Nitin Fire Protection Industries floated another wholly owned subsidiary Nitin Cylinders to set up a manufacturing unit of high pressure seamless cylinders at the Vizag special economic zone (SEZ) primarily to cater to the export market. The company has planned a capacity of 5,00,000 units per annum at this plant, which will come up in two phases. The first phase of 2,50,000-unit capacity is scheduled to commence production in May 2007, while the second phase is scheduled for commissioning by October 2007. The total cost of this expansion is estimated at Rs 118.08 crore. The company is coming out with an initial public offer of equity shares to partially finance this expansion.
The high-pressure seamless cylinders primarily cater to the industrial, medical, fire-fighting and beverages segments. However, with the advent of CNG as an alternative eco-friendly automotive fuel, a new segment has opened up, which is growing rapidly in India as well as globally.
To further benefit from the evolving market for CNG applications, Nitin Cylinders also intends to make and sell fuel dispensers. It has entered into an MoU for technology transfer with Kraus Global Inc., Canada, and for the supply of its proprietary products in India, Bangladesh and the UAE.
Nitin Fire Protection Industries picked up a 10% stake in the consortium along with petroleum giants such as GSPC (20%), Gail (20%), HPCL (20%,), BPCL (10%), Hallworthy (10)% and Silverware (10%) for the exploration and prospecting of crude oil block RJ-ONN-2004/1, admeasuring a contract area of 4,613 sq. km, in Rajasthan. The cost of operating the oil block is estimated at about US$ 30.67 million out of which the company's share works out to US$ 3.07 million (over Rs. 13 crore).
Strengths:
Operating from SEZ will help in effectively tapping global markets for high pressure seamless cylinders. The demand for high-pressure seamless cylinders to carry CNG will continue to grow at a high rate due to the global shift to CNG as an automotive fuel. The business of CNG cascades and the tie-up for manufacturing CNG fuel dispensers for domestic markets hold immense potential for future with a number of city gas distribution projects planned. The availability of natural gas is expected to double in the next two years.
Weaknesses:
Will need to establish its brand image and marketing network in the export markets.
Foray into oil exploration looks diversionary and may lock up funds in unrelated business.
Valuation:
The price band for the IPO is Rs 171 to Rs 190, which translates into a P/E of 21.0x at the lower band and 23.3x at the higher band on the consolidated EPS (on post-IPO equity) of Rs 8.2 for the year ended March 2007. Around 51% of the consolidated profit comes from the fire protection business and the balance from the cylinder business. The proposed project is in the cylinder business. The nearest comparable company in the cylinder business is Everest Kanto Cylinders, which already commands substantial market share in this business, is currently trading at Rs 1168, with P/E of 37.6 times consolidated nine-month annualised EPS. The strong financial and stock market performance of Everest Kanto after listing is likely to augur well for Nitin Fire Protection in the short term.
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Published by DalalStreet Business @ 9:06 AM IST.
MIC Electronics Ltd - Review
Friday, May 04, 2007
ICICI Direct advises you to apply for this IPO. I have personally not looked into it and have no opinion. Here are ICICI Research's thoughts.
LED display market is around US$3.55 billion and is expected to reach US$3.9 billion by 2007. This market has grown at a CAGR of 15.98% between FY04 to FY07. Also the Live entertainment industry is growing at 18% and needs more LED displays for live events. MIC could be a big beneficiary from the boom in the media space.
MIC is the only player in India to have manufacture to design capabilities for LED video display in India . The company does customised solutions for customers for LED display used in sports and live events, advertising applications, indoor applications such as shopping mall, airports etc and mobile vans. The company also has international presence and offices in many countries.
Financials:
The company posted a top line of Rs 104.4 crore for FY06 compared to Rs 21.19 crore for FY05, while its bottom line jumped to Rs 15.4 crore from Rs 2.14 crore. For the 6 months ending FY07, the company clocked an income of Rs 65.46 crore and posted a profit of Rs 10.89 crore. More than 30% of the income comes from the media business while the rest from telecommunications and info-tech businesses. We expect the company to post a top line of Rs 206 crore in FY07 and Rs 230 crore in FY08 with a bottom line of Rs 32.56 crore and Rs 40.5 crore in FY07 and FY08 respectively. We expect the revenues from the media segment to contribute more than 50% of the top line in FY08, which has EBIDTA margins around 30%.
Valuations of IPO:
The issue is being priced at a price band of Rs 129-150. At the top end of the price band, the stock commands a P/E of 7.44x FY08 EPS of Rs 20.15. Global companies in the media business such as BARCO NV and Daktronics are trading at a P/E multiple of 25 inline with Indian media companies. Based on this MIC Electronics very reasonably priced and one may consider investing in the stock.
Issue closes on May-8th.
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Published by DalalStreet Business @ 2:12 PM IST.
