Tube
Investments of India Ltd (540762) closes at ₹1192.15 with a Fall of -3.30% on
18-June-2021 with formation of a Long Red Candle on Daily Price
Chart.
About the Company : Tube Investments of India Limited is an
India-based mobility focused manufacturing company. The Company is engaged in
manufacturing products for automotive and industrial applications. It operates
through three segments: engineering, bicycles and metal formed products. The
engineering segments is engaged in manufacturing cold drawn welded (CWD) and
electric resistance welded (ERW) tubes, tubular components, large diameter
tubes for hydraulic cylinders and off-road applications, and special grade cold
rolled steel strips (CRSS). The bicycles segment is engaged in manufacturing
and marketing a wide range of bicycle brands, fitness equipment and
accessories. The metal formed products segment is engaged in manufacturing and
supplying auto and industrial chains, blanking components, motor casings and
metal formed products for automotive, industrial and railway segments
Strength : 1. Sales are likely to touch 1.45crore units in FY22 compared to 1.2 crore in the last fiscal. According to most sellers, the key drivers of demand are the surge in noncontact and nonequipment fitness sports due to social distancing norms. Of the four major segments — standard cycles, export range, premium and kids cycles — only premium and kid segments have driven up the demand.
2. In the 2020 fiscal the kids and premium segment cumulatively enjoyed a 40 per cent share of the overall cycle sales& it will increased to 50% in FY2022
3.
Demand for cycles was mostly
driven by metropolitan and Tier-1
cities, where demand grew by
almost 100 per cent.
Financials : Tube
Investments of India Ltd has posted Net Sales / Revenue of ₹6083.30 Cr & Net
Profit of ₹286.30 Cr in FY2021 and expected to post Net Sales /
Revenue of ₹5355.60 Cr & Net Profit of ₹452.10Cr in FY2022 & Net Sales / Revenue of ₹6183.20 Cr & Net
Profit of ₹468.20 Cr in FY2023.
EPS will be improved from 14.85 in FY2021 to 29.50 in FY2023, reduction
of debt from ₹209.50Cr to ₹66.00Cr with
increase in Free Cash Flow from ₹125.20 Cr to ₹525.50 during the
same period. Book Value Per Share will increase from ₹113 to ₹161 in FY2023.
Valuations : The Company is now Trading at X 4.80 of its valuations
of its FY2021 earnings with ~380% Premium and X3.05 of its FY2022 earnings with
~205% premium & X2.95 of its FY2023 earnings with ~195% premium
Margin of Safety (1Yr Bond Yield: Value>1 ) is now 0.30 which
makes is attractive after a ~70 Decline in Price . The Equity Value Per Share ( Enterprise Value Method
) is ₹1000.60
If We factor its FY2023 earnings/valuations, its Price
arrives at ₹1922.
Disclaimer : We are / may going to take exposure shortly.
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Data
Source | NSE Website | Screener.In | Capital Line | Money Control |
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author tracks economic, behavioural and corporate tends, hoping to gauge good
avenues of return based on Fundamental Valuations of Stocks, a follower of EPV
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