Multi Baggers
FIEM Ind
BSE ID : 532768 NSE ID : FIEMIND
RECOMMENDED PRICE 327.35
PEAK FROM RECO 2109.05 544.28%
CURRENT PRICE 1143.95 Resource id #18
FIEM Industries is the leading OEM supplier of automotive lighting and rear view mirrors. We initiate a 'BUY' on the stock with a target price of Rs 420 with the medium to long term investment horizon.
FIEM Industries
FIEM Industries is the leading OEM supplier of automotive lighting and rear view mirrors. During the last 5 years of turbulent economic scenario, the company has grown by a CAGR of more than 22 percent.
The company has registered robust results for the quarter ending September 2013 despite of touch economic environment and high input costs. The revenues from operations on jumped by around 25 percent at Rs.179.12 crores vs Rs.143.29 crores y-o-y. Operating profit climbed sharply at about Rs.21.14 crores as against Rs.16.07 crores in the previous year quarter. Raw material cost as a percent of total sales declines at 57.99 percent in quarter ending September 2013 as compared to 61.39 percent in Q2FY13. The net profit skyrocketed at Rs.9.08 crore for the quarter as compared to Rs.6.26 crore. EPS for the quarter stood at Rs.7.59. Operating profit margin stood at 11.80 percent witnessing an expansion of 58 bps y-o-y. Net profit margin stood at 5.07 percent; expanding 70bps y-o-y.
Two-wheeler segment constitute a major part in overall business of the company and in that too it is leader in scooters, hence this has remained a contributory factor in growth of Automotive Lighting and Mirrors business.
Fiem Industries has diversified into LED indoor and outdoor lighting business and manufacturing a large range of LED products like LED Home Lighting, LED Bulbs and tubes, LED Solar Street Lighting, Multi-Functional Torches cum Flasher Lights, LED Solar Lanterns, LED Display panels for buses and trucks and LED display signal systems for Railways etc.
Valuation
With strong position in Auto-component business, expanding product portfolio, firm tie-ups with global players and increasing geographical presence; Fiem Industries Ltd. growth looks promising. We believe the company is trading at an attractive valuation at 12.44x and 10.65x of FY14EPS of Rs.26.31 and FY15EPS of Rs.30.75. We initiate a 'BUY' on the stock with a target price of Rs.420 (appreciation of about 28 percent) with the medium to long term investment horizon.
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Disclaimer & Disclosure: This document is prepared for our clients only, on the basis of publicly available information and other sources believed to be reliable. Whilst we are not soliciting any action based on this information, all care has been taken to ensure that the facts are accurate, fair and reasonable. This information is not intended as an offer or solicitation for the purchase or sell of any financial instrument and at any point should not be considered as an investment advise. Reader is requested to rely on his own decision and may take independent professional advise before investing. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited, Directors and any of its employees shall not be responsible for the content. The person accessing this information specifically agrees to exempt Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and further agrees to hold Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The companies and its affiliates, officers, directors, and employees, including persons involved in the preparation or issuance of this material may from time to time, have long or short positions in, and buy or sell the securities there of, company (ies) mentioned here in and the same have acted upon or used the information prior to, or immediately following the publication. Analyst Certification The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
FiemInds_HemSec_Multibagger.pdf
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