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Multi Baggers

Hem Securities

5.30 AM Jan 1st 1970

IFGL Refractory

BSE ID : 540774     NSE ID : IFGLEXPOR

RECOMMENDED PRICE 114.20

PEAK FROM RECO 527.00 361.47%

CURRENT PRICE 540.65 Resource id #18

IFGL Refractories was established in 1989 and is the flagship company of S K Bajoria Group. It is engaged in the manufacture of specialized refractories and requisite operating systems for the Steel Industry. We initiate a 'BUY' on the stock with a target price of Rs 145.

IFGL Refractories

IFGL Refractories Ltd is a leading manufacturer of specialized Refractories having manufacturing facilities in China, Germany, India, UK and USA. Krosaki Harima Corporation (a subsidiary of Nippon Steel Corporation, Japan) is the technology provider. Also, engaged in manufacture of foundry ceramics and bio ceramics.

The company has registered robust results for the quarter ending March 2014. The revenues from operations grew by ~22 percent to Rs.200.33 crores vs. Rs.164.05 cr. in the corresponding quarter last year. Operating profit climbed sharply by ~216 percent at about Rs.28.22 crores as against Rs.8.92 crores in the previous year quarter. The adjusted net profit grew manifold at Rs.15.75 crore for the quarter as compared to Rs.2.16 crore. EPS for the quarter stood at Rs.4.55.

Revenue from India grew by 13.46 percent at Rs.94.08 crores in Q4FY14 from Rs.82.92 crores y-o-y. Asia revenues excluding India degrew by 7.11 percent at Rs.15.55 crores. Europe revenues skyrocketed by 40.66 percent at Rs. 76.42 crores from Rs.54.33 crores y-o-y. Revenues from America grew by 12.43 percent at Rs.38.63 crores from Rs.34.36 crores y-o-y.

IFGL Refractories is all set to expand capacity at Kandla in Gujarat and Ohio in the US, to two fold. The expansion will cost an around USD 2 million and will be funded through internal accruals. The project is scheduled to be initiated this year.

Valuation

With strong capacity expansion plans; increasing global presence; strong customer base; improved financial performance and effective cost rationalization measures; IFGL Refractories Ltd. growth prospects and profitability looks positive. We believe the company is trading at an attractive valuation at 5.10x and 4.19x of FY15EPS of Rs.22.38 and FY16EPS of Rs.27.24. We initiate a 'BUY' on the stock with a target price of Rs145 (appreciation of about 27 percent) with the medium to long term investment horizon.

For full details, Click on the attachment.

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.

IFGL Refractories_HemSec_Multibagger.pdf

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