INDUSTRY TEXTILES
WEBSITE WWW.RSWM.IN
CMP 145.00
FACE VALUE 10.00
DIV/YIELD 1.72
PE RATIO 3.28
MARKET CAP 336 CRORE
BOOK VALUE 99.00
EPS (APR-DEC11)33.52
EXPECTED EPS 50+
RSWM Ltd was incorporated in 1960, is the flagship company of LNJ Bhilwara Group. It is one of the largest textile groups for manmade fibres, yarns and fabrics with total spindles capacity is 3, 60,000 and production of 1, 00,000 TPA of yarn annually. Its 100% subsidiary CTL has total installed capacity of 64, 512 spindles at Bagalur (Tamil Nadu) and Pondicherry.
The company exports to 70 countries including Europe and USA .
Company has well established brand under the name of ‘Mayur’. ‘Mayur’ has been consistently delivering high quality fabrics to the market and is in highly deemanded in indian markets. It has 7,000 retail outlets all over India.
At current market price of Rs 145/- it is trading at 3.28X (source moneycontrol.com)and expecting FY12EPS to be around Rs 50, so it is trading for just 2.9X to FY12E EPS. Industry average PE is 9X, even if we value it conservatively at 5X, the fair value of the company comes at around Rs 250/- share.
Outlook remains positive as domestic market is doing well on back robust economic growth. Company has good retail network that will help in capitalizing the robust domestic demand.
Investor with medium to long term investment horizon should start accumulating the stock. The investment horizon should be at least 8-10 months.
No comments:
Post a Comment