FC Sheet-Techno Industry Report

TECHNO SHARES & STOCKS LTD
INDIA RESEARCH
FC SHEET INDUSTRY
20th AUGUST 2010
FIBER CEMENT SHEET INDUSTRY REPORT

GRAMIN VIKAS
ABHILASHA SATALE
6633 8900 EXT. 152
abhilasha.satale@technogroup.co.in
This Page is Intentionally Left Blank
FC SHEET INDUSTRY
RAMCO INDUSTRIES LTD.
Recommendation
CMP
Target Price
Equity
Mkt Cap
BUY
`67
`85
`86.7cr
`585cr
EVEREST INDUSTRIES LTD.

Recommendation
CMP
Target Price
Equity
Mkt Cap
BUY
`275
`336
`14.82cr
`407.55cr
KEY HIGHLIGHTS
Rising disposable income in the hands of rural people and rising warehousing demand is
major drivers Fibre Cement (FC) Sheet demand. Governments increasing thrust on rural
housing, rising MSPs of crops are likely to fuel demand growth of 4mnt FC sheet industry
at more than 10% CAGR over the medium term. Oligopoly structure of the industry
retains 60% of the market share in the hands of 4 players giving pricing power. Capacity
additions foreseen in the industry over the medium term are unlikely to create a glut.
Therefore, we recommend BUY on Everest Industries, Ramco Industries, Hyderabad
Industries and Visaka Industries.
HYDERABAD INDUSTRIES LTD.

Recommendation
BUY
CMP
`625
Target Price
`808
Equity
`7.49cr
Mkt Cap
`468.53cr
Governments thrust on rural housing: In just 5years from 2006-07 to

2010-11 government spending on rural economy has increased at a CAGR of
47% from `7735cr to `53084cr. Under NREGA the allocation has increased at
a CAGR of 37% from `11300cr to `40100cr over the same period. Indira
Aawas Yojana has been able to garner budgetary support of `10000cr in 201011. Under this scheme total house constructed in the year has gone up from
11lakh houses in 2005-06 to 40lakh houses in 2010-11. This will increase the
demand for FC sheets, as this is the preferred roofing material in the rural
housing.
VISAKHA INDUSTRIES LTD.

Recommendation
BUY
CMP
`162.75
Target Price
`202
Equity
`15.92cr
Mkt Cap
`259.098cr
Warehousing- Big opportunity: The development of organized retail in

India and the rising fortunes of the manufacturing sector following Indias
emergence as a low-cost outsourcing hub have buoyed its warehousing
market. Indian warehousing sector growing at the rate of 35-40 percent
annually to become a $55 billion industry by 2010-11. We expect demand
from this sector for FC sheets to pick up very fast as the sector is still under
penetrated.
Rural boom to benefit: Rural consumer enjoys rising disposable income

due to unprecedented food inflation, which has driven up MSPs for farmers
whereas the costs are capped due to government subsidies. MSPs for most
of the crops have increased at more than 10% CAGR during last 5 years.
Rising disposable income in the hands of rural consumer will fuel up demand
for FC sheets.
Sustainable growth: Rural boom, rising warehousing are growth potentials

for FC sheet industry. Current consumption of FC sheets in the country is
around 4mnt, which we expect to grow at a sustainable rate of 10-12% over
the longer term. Oligopoly structure of the industry to retain more than 60%
market share in the hands of 4 major players.
Reducing cost increasing margins: Reducing cement prices to reduce cost

of manufacturing for asbestos cement sheets as cement contributes around
35% of the total cost. Cement prices have corrected by 20% from its high.
Thus, reducing manufacturing cost. Another important raw material for
cement sheets is asbestos fiber, which is mostly imported. The prices of the
product have increased by 5-6% having 2-3% effects on the end product
pricing.
Valuations not factoring future potentials: Inspite of strong growth

expected in medium term the entire gamut of companies in the sector is
available at very compelling valuations currently. We expect demand growth of
10% for FC Sheet industry to drive four organized players profitability at 20%
CAGR over next two years. Ramco Industries is our best bet in the
entire spectrum due to aggressive expansion plans and ramping up
of Srilankan operations. Followed by Everest Industries due to its
cheap valuation and exposure to building solutions segment. We
recommend BUY on Hyderabad Industries and Visaka Industries
as well.
FC SHEET
20th August 2010
INVESTMENT RATIONALE
GOVERNMENTS THRUST ON RURAL HOUSING
GOIs focus on rural housing to be another factor, which will drive FC sheet
demand. Through different social schemes like Bharat Nirman, Indira Aawas Yojana
and NREGA government is boosting support to housing development in rural
market. Allocation towards IAY and NREGA has increased at a CAGR of 29% and
37% over 2006-2010 respectively. Total houses to be build under IAY is expected
to be around 40lakh in 2010-11. Government intends to build 150lakh houses in
11th Five Year Plan.
NREGA is anticipated to provide employment to around 10.9cr people in 201011E. Average wage per person per day has gone up from `65 in 2006-07 to `89 in
2010-11E.
Rising disposable income through increased primary product prices and different
government initiatives to provide dwelling and employment to give more pricing
power in the hands of rural people. Current penetration of FC sheet is low in the
country whereas, increasing income in the hands of rural consumers to improve
demand for FC sheets going forward. We expect FC sheet demand to grow at 1012% in the medium term. Current consumption in the country is around 40lakh
tones for FC sheets.
Allocation under schemes (`
`Cr)
100%
80%
2775
60%
960
40%
20%
4000
0%
2005-06
11300
12000
2920
1200
3000
4040
1800
2600
2006-07
2007-08
Sampoorna Gramin Rozgar Yojana

Indira Aawas Yojana
30000
39100
40100
5400
2350
0
8800
2350
0
10000
2984
0
2008-09
2009-10
2010-11
Swarnajayanti Gram Swarozgar Yojana

NREGA
Source : Economic Survey
Houses constructed (Units)
NREGA Success
4500000
12
4000000
10
3500000
3000000
2500000
2000000
10.89
10.01
6.48
65
3.78
100
89
84
75
4.51
3.39
4.34
20
1000000
0
2006-07
500000
60
40
2.1
1500000
80
2007-08
2008-09
2009-10
Job cards issued (Crores)

2010-11
2009-10
2008-09
2007-08
2006-07
2005-06
Employment provided to households (Crores)

Average wage paid per person/day (Rs)
FC SHEET
20th August 2010
FC Sheet Price (`
`/tonne)
FC Sheet demand (lakh tonne) and growth (%)
10000
8000
55
50
45
40
35
30
25
20
9000
8349
9000
6812
7533
7064
6212
7000
6000
2010-11
2009-10
2008-09
2006-07
2005-06
2004-05
5000
10.9%
10.0%
8.9%
8%
31.4
11%
8.7%
7.6%
36.8
33.8
40
44
13%
48.8
9%
7%
5%
2004-05 2005-06 2006-07 2008-09 2009-10 2010-11
Source : Industry
Source : Industry,Techno Estimate
WAREHOUSING- BIG OPPORTUNITY

The boom in commodities and retailing will result in Indian warehousing sector
growing at the rate of 35-40 percent annually to become a $55 billion industry by
2010-11. According to an industry report by the Associated Chambers of
Commerce and Industry in India (Assocham), India is short of 10 million tonnes of
cold storage capacity, resulting in the wastage of over 30 percent of agricultural
produce every year. A recent report by brokerage Macquarie Research said the
Indian government plans to spend $24 billion over eight years on cold or supply
chain infrastructure. The development of organized retail in India and the rising
fortunes of the manufacturing sector following Indias emergence as a low-cost
outsourcing hub have buoyed its warehousing market. FC sheet is preferred
roofing material in warehousing industry. Therefore we feel warehousing industry
to be major demand booster for FC sheet industry.
OLIGOPOLY TO RETAIN PRICING POWER
Four players gaining around 60% of the market share makes FC sheet industry an
oligopoly retaining pricing power to leaders. Hyderabad Industries with 854500t of
capacity controls around 19% of the market share in FC sheet industry. Strong
demand and controlled supply to improve margins of these players.
In 2007-08 global slowdown and capacity expansions created glut in roofing sheet
industry affecting the profitability of the companies. However, current upturn is
likely to sustain longer as capacity additions are very limited in the current cycle.
Where demand is expected to increase by atleast 400000t every year the capacity
additions by major four players is averaging 200000t p.a. for next two years. FC
sheet manufacturing is highly sensitive to environmental norms. Similarly, plant
location is also very important the product being less transport friendly. These
factors act as barriers for huge expansion consequently avoiding the glut.
Capacity additions by major players (Tonnes) (Revenue)
242000
208150
153470
238000
192000
165000
90000
64500
2003
2004
2005
2006
2007
2008
2009
2010
Source : Industry,Techno Estimates
FC SHEET
20th August 2010
FC sheet-PREFERRED ROOFING OVER ITS ALTERNATIVES

Cement Asbestos Sheet is preferred choice amongst rural class due to durability,
sound resistance, safety and affordability. There are estimated 25 crore houses in
India Of these, 46% are considered to be homes with pucca roofs. The rest 54%
homes are made of thatch (temporary kuccha roofing) and clay tiles. Usage of clay
tiles is shrinking due to non-availability of raw material. Amongst pucca houses,
less than half are made with RCC slabs. The rest are made with ready-house
roofing products, which include Fibre Cement Roofing and metal roofing. Some
roofs are also made using bricks and stone. A kuccha roof homeowner has
aspirations and seeks security. He is more likely to graduate to a Fibre Cement
Roof rather than a RCC slab. The cost of a pucca roof using Fibre Cement Roofing
is 1/3rd the cost of an RCC ceiling slab. The market for Fibre Cement Roofing
today is estimated to be `4,000 crores and for metal roofing `3,500 crores and
Indias demand for housing and infrastructure continues to grow unabated.
Preferability chart
Comparison of other sheets with FC sheet chart.
Life Span (years)
THATCHET
RED CLAY TILES
CORRUGATED GALV.
IRON SHEETS
ALUMINIUM SHEETS
FC SHEET
2-3years
NA
Oct-15
NA
50
Maintenace
Nil
Frequent
3-5yers
Nil
Nil
Fire rating
Poor
Retardant
Poor
Poor
Retardant
Thermal insulation
Good
Good
Poor
Poor
Good
Wind Resistance
Poor
Poor
Poor
Poor
Good
Noise level
Poor
Poor
Poor
Poor
Good
Acoustic rating
NA
Poor
Poor
Poor
Good
Condensation
Cost
Low
Low
High
High
Low
Very Low
Low
High
Very High
Low
REDUCING CEMENT PRICES TO BENEFIT

Cement contributes around 45% of the total volume in FC sheet manufacturing
and around 15% of the total cost. Rising capacity expansions in the cement
industry has created medium-term supply glut in the industry thus, putting
pressure on the prices. Cement prices on an average have reduced around 20%
from its high. We expect cement prices to be lower for the medium term. This
would benefit FC Sheet industry as the end product prices are not dependent on
the raw material prices, end user being different.
FC SHEET
20th August 2010
KEY RISKS
Dependency on imported raw material
Asbestos fibre is important raw material for FC sheet manufacturing contributing
around 30% of total cost. India doesnt have any procurable reserves of chrysotile
fibre. Therefore, we import 100% of our requirement from major four players.
Imported raw material leaves industry vulnerable to forex risks and dependency
on four players doesnt give bargaining power.
PRODUCT NAME
HYDERABAD INDUSTRIES
EVEREST INDUSTRIES
VISAKA INDUSTRIES
RAMCO INDUSTRIES
ASBESTOS CEMENT FIBRE

SHEET
BUILDING PRODUCTS

SHEET

SHEET
854500
710000
652000
534000
80.55
81
78.64
62
19.4
16.1
14.8
12.1
BUILDING PANELS &

BOARDS
STEEL BUILDING
BOARDS
CALCIUM SILICATE
BOARD
460000
30000
60000
40000
2.9
17
2.41
3.97
TEXTILE YARN (SPINDLES)
CEMENT CLINKERS
GRINDING
100000
1816
216000
3.87
18.71
4.28
Capacity (MT)
Contibution to revenue (%)
Market share (%)
PRODUCT NAME
Capacity (MT)
PRODUCT NAME
AACB
Capacity (MT)
PRODUCT NAME
THERMAL INSULATION
TEXTILE YARN (SPINDLES)
6000
43296
4.7
12.77
Capacity (MT)
PEER COMPARISON
(` mn)
EVEREST
HYDERABAD
RAMCO
VISAKA
FY09
FY10
FY11E
FY12E
FY09
FY10
FY11E
FY12E
FY09
FY10
FY11E
FY12E
FY09
FY10
FY11E
FY12E
5520.10
6809.00
9886.00
11308.00
6234.00
7036.90
8522.65
9963.31
4528.70
5286.10
6284.80
7685.09
5779.80
5981.30
7226.20
7805.10
EBITDA
537.30
684.00
1092.48
1272.35
928.30
1548.40
1639.53
1949.02
1031.50
1195.40
1493.82
1771.36
903.90
1171.60
1328.47
1402.07
Net Profit
144.50
283.80
523.24
623.25
440.90
870.20
920.39
1096.93
356.50
535.90
642.15
854.88
359.40
572.10
684.65
729.29
Equity
148.00
148.00
148.00
148.00
74.60
74.60
74.60
74.60
43.30
86.70
86.70
86.70
158.80
158.80
158.80
158.80
Debt
1743.00
1281.80
1290.00
1190.00
803.20
698.40
740.00
860.00
2592.00
2476.60
3250.00
2930.00
1687.50
1620.30
1415.50
1415.50
9.76
19.18
35.35
42.11
59.10
116.65
123.38
147.04
82.33
6.18
7.41
9.86
22.63
36.03
43.11
45.92
98.88
109.80
134.40
171.87
218.85
287.50
380.19
485.51
604.41
34.98
41.15
48.59
109.26
133.32
167.05
205.52
21%
17%
19%
17%
19%
22%
34%
3%
21%
8%
Sales
EPS
BVPS
GROWTH MARGINS & RETURNS

sales growth
86%
23%
47%
15%
30%
13%
PAT growth
84%
110%
84%
19%
213%
97%
6%
19%
40%
50%
20%
33%
369%
59%
20%
7%
EBITDA margins
10%
10%
11%
12%
15%
22%
19%
20%
23%
23%
24%
23%
16%
20%
18%
18%
3%
4%
5%
6%
7%
12%
11%
11%
8%
10%
10%
11%
6%
10%
9%
9%
PAT margins
Tax rates
4%
29%
29%
29%
33%
7%
6%
33%
29%
29%
29%
29%
32%
33%
33%
33%
ROE %
10%
17%
26%
25%
27%
41%
32%
30%
14%
18%
18%
20%
21%
27%
26%
22%
ROCE %
10%
12%
19%
19%
21%
32%
27%
26%
12%
14%
15%
16%
14%
17%
17%
34%
DER
1.15
0.74
0.58
0.42
0.44
0.28
0.23
0.21
0.93
0.75
0.85
0.64
0.90
0.69
0.48
0.40
VALUATIONS
CMP
260.00
Mcap
PER (x)
639.00
3848.00
72.00
4766.94
163.00
6242.40
2588.44
26.63
13.56
7.35
6.17
10.81
5.48
5.18
4.35
0.87
11.65
9.72
7.30
7.20
4.52
3.78
3.55
P/BV
2.63
2.37
1.93
1.51
2.92
2.22
1.68
1.32
0.12
2.06
1.75
1.48
1.49
1.22
0.98
0.79
EV / EBITDA (x)
9.16
7.20
4.51
3.87
5.26
3.16
2.98
2.51
6.21
5.36
4.29
3.61
4.10
3.16
2.79
2.64
Mcap / sales
FC SHEET
0.57
0.68
1.18
0.43
20th August 2010
INVESTMENT OUTLOOK
RURAL BOOM TO BENEFIT
Rising disposable income in the hands of rural consumer will drive asbestos
cement roofing sheet demand in the country. Rising food deficit, increasing prices
and rising MSPs are providing farmers with additional disposable income. Even
today only 20% of rural roofs are of FC Sheet thus, stores lot of potential for
replacement demand against thatched and red tiles roofs.
Food inflation is at the highest level today at 16% showing supply side constraints.
Good prices world over sky-rocketed last year and are not showing signs of
softening. This has increased MSPs (Minimum Support Prices) for all the
commodities leaving more disposable income in the hands of farmers. 60% of the
population, which drives the consumption of the economy gaining money power,
would drive the demand for rural products such as FC sheets. We expect food
inflation is not a short-term cause to deal with. Rising consumption to settle food
prices at higher level benefiting that 60% of the population.
MINIMUM SUPPORT PRICE (MSP)
Maize
Moong
Barley
Urad
Gram
Sugarcane
2009-10
2008-09
2007-08
2006-07
2005-06
2004-05
2003-04
2002-03
2002-03
2001-02
1999-00
1990-91
3000
2000
1000
0
Arhar
VALUATION
We feel FC sheet industry to be major beneficiary of rural boom and rise in
warehousing demand. Inspite of huge potential the companies under this sector
are under owned by investors. This is expected to be reason for re-rating of the
entire sector. On an average we expect the profitability of the sector companies
to grow at a CAGR of 20% over the next two years. However, the stocks are still
available at much lower level of P/E of around 6-7x forward.
Our favorite stock in the spectrum is Ramco Industries which will be
benefited from its aggressive expansion plans in the domestic as well as
Srilankan Markets. Everst is also preferred bet in the spectrum due to
its exposure to building solutions business which store huge business
opportunity in itself. Other than these we also recommend BUY on
Hyderabad Industries being a leader and still available cheap and
Visaka Industries.
(` mn)
PEER COMPARISON
PRICE (`)
MKT. CAP
FY11
FY12
Hyderabad Industries
643
4815
8445.3
9935.4
Ramco
72
5850
6304.8
7715.1
654
878
Everest
260
3857
9576
10968
523
Visaka
163
2591
7226.2
7805.1
684.6
FC SHEET
NET SALES
PAT
FY11
EPS
EV/EBIDTA
ROE(%)
FY11
FY12
FY11
FY12
FY11
FY12
FY11
FY12
920.4 1096.9 123.4
147.0
5.2
4.3
3.0
2.5
32.50%
30.3%
7.5
10.1
9.5
7.1
4.2
3.6
18.30%
24%
623
35.4
42.1
7.4
6.2
4.5
3.9
26.30%
24.5%
729.3
43.1
45.9
3.8
3.5
2.8
2.6
25.80%
22.3%
FY12
P/E
20th August 2010
COMPANY NOTE
RAMCO INDUSTRIES LTD.
BUY
KEY HIGHLIGHTS
CMP
`67
52 week High / Low
73/34
Equity Cap (current)
86.70
Face Value
`1
Mkt. Capitalization
`585cr
Avg. Daily Vol. (12 M)
47238
BSE SENSEX
18257
NSE - NIFTY
5479
NSE Code
RAMCOIND
Bloomberg Code
RAMCO IN
BSE Code
532369
Gaining market share through aggressive expansion: Ramco is

adding its FC sheet capacity by 120000t at Gangaijondan, which is expected
to get commissioned by 30th September 2010. Diversifying the presence
Ramco Industries is further expanding its capacity by 120000MT at the
Industrial Area, Bihiya, Bhojpur District in the State of Bihar to cater to the
markets of the Eastern and North Eastern Regions. The estimated cost of
the project is around `35cr. Aggressive capacity expansion in diversified
geographical arenas to benefit Ramco to gain market share in the growing
market. We expect Ramco to expand its sales volume from 466250t in
FY10 to 524000t in FY11E and 582600t in FY12E.
Geographical reach widening: Ramco currently operates through 7

plants located in Tamil Nadu, Karnataka, Madhya Pradesh and Gujarat. Its
8th plant at Gangaikondan will strengthen its reach Southern part. And
further expansion in Bhojpur district will widen its presence in Northern
and Eastern districts. FC sheet being less transport friendly, wider
geographical presence enables Ramco to garner various rural markets
countrywide. Its international presence in Sri Lanka to benefit it being
growing market for FC Sheets.
Sri Lankan operations to contribute: Ramco Industries has operations

in Sri Laka under its wholly owned subsidiary with total capacity of 100000t
FC sheets. Looking at the growth prospects in this country the firm has
decided to expand this capacity by 72000t at a total cost of `30cr.
Improved profitability from this division is likely to contribute it its profits
going forward.
Textile business to flourish: Ramco with 43296 spindles capacity spins

around 2.6mnt yarn. Production is expected to rise due to rising yarn
prices. We expect Ramco to spin around 4mnt yarn in FY11E and FY12E.
Yarn prices have increased around 25% in FY10, which we expect to settle
at higher level. Therefore, profitability from the textile business is expected
to rise.
Hiving off plastic division- a positive move: The managements move

to hive off plastic storage container division is a positive move. The division
generates thin margin thus, impacting ROE. The anticipated consideration
for the proposed move is around `1.43cr.
Strong cash flow to fund capex: Ramco Industries is expected to

generate Free Cash Flow of `45cr and `65cr in FY11E and FY12E
respectively. Strong cash flows generation to take care of future expansion.
However, strong cash flow is expected to keep debt:equity ratio at 0.6:1
level.
Improving ROCE: Improving profitability and reducing debt level to

improve ROCE to 20% from 17% in FY09. Upturn in the industry cycle
ensures the sustainability of ROCE over medium term.
ATTRACTIVE VALUATION: We expect Ramcos sales to increase at a

CAGR of 18% over FY10-FY12E and PAT at 36% over the same period. At
the current price of `67 the stock is trading at 9xFY11E and 7xFY12E
earnings respectively. EV/EBIDTA of the firm is at 4x and 3.3x of
FY11E and FY12E EBIDTA respectively. We recommend BUY
at current price with 12-month price target of `85.
SHAREHOLDING PATTERN @ 30-06-10

Promoters
50.54%
Indian Institutions
7.70%
Public & Others
41.76%
6-MTS
YTD
1-YR
7%
20%
19%
Nifty
13%
11%
22%
Sensex
13%
11%
20%
RAMCO
(` mn)
BRIEF FINANCIALS
Net Sales
FY09
FY10
FY11E
FY12E
4,528.7 5,286.1 6,304.8 7,715.1
Sales growth
18.7%
16.7%
EBITDA
708.7
868.3 1,430.2 1,713.4
PAT
356.5
535.9
654.0
878.0
EPS
82.3
6.2
7.5
10.1
0.9
11.6
9.5
7.1
RONW (%)
13.6%
17.7%
18.3%
24.0%
EV/EBITDA
6.2
5.4
4.2
3.6
P/E (x)
ABHILASHA SATALE
66338900 EXT. 152
FC SHEET
19.3%
22.4%
20th August 2010
FINANCIALS
(` mn)
P & L A/c
FY07
FY08
FY09
FY10
FY11E
FY12E
Gross Sales
3,760.9
4,084.1
4,763.8
5,627.5
6,766.3
8,189.1
Excise Duty
262.7
269.9
235.1
341.4
368.0
415.0
3,498.2
3,814.2
4,528.7
5,286.1
6,398.3
7,774.1
17.9%
9.0%
18.7%
16.7%
21.0%
21.5%
Net Sales
% Change
Raw Materials
1,767.2
2,023.3
2,478.6
2,922.2
3,087.7
3,746.4
Stock Adjustments
(71.9)
(34.6)
(99.2)
(118.7)
Employee Expenses
188.8
198.4
208.9
261.7
328.0
344.0
Other Mfg Exp.
98.7
96.7
110.8
239.0
156.5
180.0
Repairs & Maintainence
61.6
97.1
129.2
Power, Oil & Fuel
237.0
271.5
304.8
339.9
430.6
520.0
Selling & Administrative Expenses
688.8
561.5
622.1
718.9
878.9
1,103.0
Provisions & Write offs

Other Expenses - Recurring
Non Recurring
TOTAL EXPENDITURE
3.9
32.3
29.6
37.3
54.8
150.0
250.0
6.6
11.5
27.5
3,009.1
3,258.9
3,820.0
4,417.8
5,031.8
6,143.4
Operating Profit
489.1
555.3
708.7
868.3
1,366.5
1,630.7
% Change
-15.6%
13.5%
27.6%
22.5%
57.4%
19.3%
292.4
294.2
322.8
327.1
79.0
88.0
Other Income - Recurring

Non Recurrng
EBITDA
% Change
Current Interest
Financial Charges
Less: Interest Capitalised
PBDT
2.0
5.2
783.5
854.7
1,031.5
1,195.4
1,445.5
1,718.7
6.5%
9.1%
20.7%
15.9%
20.9%
18.9%
164.9
194.9
252.6
212.2
265.6
250.8
7.8
8.5
8.7
7.8
610.8
651.3
770.2
975.4
1,179.9
1,467.9
Depreciation
277.8
282.0
306.6
289.5
350.0
380.0
EBIT
505.7
572.7
724.9
905.9
1,095.5
1,338.7
PBT
333.0
369.3
463.6
685.9
829.9
1,087.9
% Change
-29.9%
10.9%
25.5%
48.0%
21.0%
31.1%
Current Tax
77.0
69.5
130.0
180.0
240.9
315.9
Deferred Tax
9.5
41.2
(27.5)
(30.0)
(49.2)
(64.5)
Fringe Benefit Tax
3.3
3.8
4.6
1.0
Net Profit Before Minority Interest
243.2
254.8
356.5
535.9
638.2
835.6
% Change
-26.5%
4.8%
39.9%
50.3%
19.1%
30.9%
Minority Interest
Net Profit After Minority Interest
Extra Ordinary Items
1.4
(0.4)
241.8
255.2
356.5
535.9
638.2
835.6
1.4
(0.4)
(7.7)
Adjusted PAT
241.8
255.2
356.5
543.6
638.2
835.6
% Change
-26.7%
5.5%
39.7%
52.5%
17.4%
30.9%
65.0
65.0
65.0
73.6
87.6
114.8
178.2
189.8
291.5
462.3
550.5
720.8
Dividend - Equity
Preference
Retained Earnings
FC SHEET
10
20th August 2010
(` mn)
BALANCE SHEET
Share Capital - Equity
Preference
Reserves & Surplus
Revaluation Reserve
Others
Minority Interest
Secured Loans - Long Term
Short Term
Unsecured Loans - Long Term
Short Term
Deferred Tax Liabilities
Total Liabilities
FY07
FY08
FY09
FY10
FY11E
FY12E
43.3
43.3
43.3
86.7
86.7
86.7
1.0
2,207.3
2,416.1
2,731.5
3,203.7
3,754.2
4,475.1
1,621.8
2,331.6
1,886.5
1,966.2
2,116.0
1,900.0
633.3
308.9
705.5
510.4
680.0
740.0
280.2
329.2
295.8
263.9
220.0
120.0
4,785.9
5,429.1
5,662.6
6,030.9
6,856.9
7,322.8
Gross Block
3,086.9
3,885.9
4,056.2
4,173.3
4,460.0
4,610.0
Less Accumulated Depreciation
1,126.9
1,407.2
1,713.2
1,989.6
2,339.6
2,719.6
Less Impairment of Assets
Net Block
1,960.0
2,478.7
2,343.0
2,183.7
2,120.4
1,890.4
Capital WIP
50.9
15.9
8.3
249.8
1,928.3
1,928.3
2,026.2
2,026.3
2,680.0
2,890.0
592.9
683.7
1,097.1
1,292.9
1,440.0
1,680.0
Debtors
239.9
273.0
290.9
293.3
460.0
610.0
Advances
353.3
376.3
485.7
592.6
890.0
1,010.0
1,186.1
1,333.0
1,873.7
2,178.8
2,790.0
3,300.0
292.1
364.3
561.3
542.4
620.0
760.0
105.7
120.5
178.7
242.5
326.0
353.0
788.3
848.2
1,133.7
1,393.9
1,844.0
2,187.0
Lease Adjustments
Investments
Current assets, Loans & Advances
Inventories
Total Current Assets

Less Current Liabilities
Provisions
Net Current Asssets
Cash & Bank
58.4
150.2
149.4
177.2
201.5
335.4
Miscelleneous Exp. Not w/f
Deffered Tax Asset
7.8
2.0
11.0
20.0
4,785.9
5,429.1
5,662.6
6,030.9
6,856.9
7,322.8
Total Assets
FC SHEET
11
20th August 2010
EXPENSE ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
Raw Material / Net Sales
50.5%
53.0%
54.7%
55.3%
48.3%
48.2%
Raw Material adjusted / Net Sales
48.5%
52.1%
52.5%
53.0%
48.3%
48.2%
6.8%
7.1%
6.7%
6.7%
6.7%
6.7%
Power & Fuel / Net Sales

Employee Exp. / Net Sales
5.4%
5.2%
4.6%
4.6%
4.6%
4.6%
Other Mfg Exp./ Net Sales
2.8%
2.5%
2.4%
2.4%
2.4%
2.4%
19.7%
14.7%
13.7%
13.7%
13.7%
13.7%
Other Exp./ Net Sales
1.1%
1.1%
1.4%
1.4%
1.4%
1.4%
MARGIN ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
Operating Margin(%)
14.0%
14.6%
15.6%
16.4%
21.4%
21.0%
EBITDA Margin(%)
22.4%
22.4%
22.8%
22.6%
22.6%
22.1%
PBDT Margin(%)
17.5%
17.1%
17.0%
18.5%
18.4%
18.9%
EBIT Margin(%)
14.5%
15.0%
16.0%
17.1%
17.1%
17.2%
PBT Margin(%)
9.5%
9.7%
10.2%
13.0%
13.0%
14.0%
PAT Margin(%)
7.0%
6.7%
7.9%
10.1%
10.0%
10.7%
11.9%
12.0%
13.6%
14.3%
14.1%
14.0%
ANALYSIS INPUTS
FY07
FY08
FY09
FY10
FY11E
FY12E
Book Value Per Share
500.3
543.9
604.4
35.0
41.1
48.5
DPS
15.0
15.0
15.0
0.8
1.0
1.3
EPS
56.2
58.8
82.3
6.2
7.4
9.6
Adjusted EPS
55.8
58.9
82.3
6.3
7.4
9.6
120.3
124.0
153.1
9.5
11.4
14.0
2.8%
3.2%
3.9%
3.7%
3.8%
4.4%
1.1
1.0
1.1
1.3
1.4
1.7
24.1%
19.8%
29.0%
29.0%
29.0%
29.0%
FY07
FY08
FY09
FY10
FY11E
FY12E
Current Ratio (Times)
3.1
3.1
2.7
3.0
3.2
3.3
Debt Equity Ratio (Times)
1.0
1.1
0.9
0.8
0.7
0.6
Interest Coverage Ratio(Times)
2.5
2.4
2.4
3.6
3.4
4.3
11.2%
10.8%
13.6%
17.7%
17.9%
19.9%
Dividend Payout (%)
26.7%
25.5%
18.2%
13.7%
13.7%
13.7%
Dividend Yield (%)
22.1%
22.1%
22.1%
1.2%
1.5%
1.9%
Debtors Turnover(Times)
15.0
14.9
16.1
18.1
17.0
14.5
Creditors Turnover(Times)
15.5
18.2
14.0
14.6
15.1
15.9
Inventory Turnover (Times)
5.7
6.0
5.1
4.4
4.7
5.0
Average Collection period (Days)
24.3
24.5
22.7
20.2
21.5
25.1
Average Payment period (Days)
23.6
20.0
26.0
25.1
24.2
23.0
Inventory Turnover (DAYS)
64.3
61.1
71.8
82.5
78.0
73.2
S & D/ Net Sales
EBIAT Margin(%)
CEPS
Cash As a % Of Total Exp.
Net Sales/ Gross Block (Times)
Current Tax (%)
DEBT EQUITY RATIO (TIMES)
Return On Average Net Worth(%)
PRICE/ADJUSTED EPS
FY07
FY08
FY09
FY10
FY11E
FY12E
P/E
1.2
1.2
0.8
11.0
9.2
7.1
Price/CEPS
0.6
0.5
0.4
7.1
6.0
4.8
Price/Book Value
0.1
0.1
0.1
1.9
1.7
1.4
EV/EBITDA
7.4
6.8
5.6
4.9
4.0
3.4
Pay Back Period
0.6
0.5
0.4
7.0
5.9
4.8
FC SHEET
12
20th August 2010
(` mn)
CASH FLOW
FY07
FY08
Net profit
241.8
255.2
356.5
543.6
638.2
835.6
Depreciation
277.8
282.0
306.6
289.5
350.0
380.0
Deffered Tax
9.5
41.2
-27.5
-30.0
-49.2
-64.5
-149.1
-59.9
-285.5
-260.2
-450.1
-343.0
380.0
518.5
350.1
542.9
488.8
808.1
Capex
-227.5
-764.0
-162.7
-358.6
-36.9
-150.0
Investments (Net)
-123.5
0.0
-97.9
-0.1
-653.7
-210.0
Cash Flow from Investing Activities
-351.0
-764.0
-260.6
-358.7
-690.6
-360.0
-65.0
-65.0
-65.0
-73.6
-87.6
-114.8
0.0
0.0
0.0
43.4
0.0
0.0
change in working capital

Cash Flow From Operating
Activities:
Dividend
Share Capital
Share premium received
Debt
Cash Flow From Financing Activities
Others
FY09
FY10
FY11E
FY12E
0.0
0.0
0.0
0.0
0.0
1.0
10.0
385.4
-48.5
-115.4
319.4
-156.0
-55.0
320.4
-113.5
-145.6
231.8
-270.8
84.3
133.3
126.2
188.0
207.2
378.8
Net change in cash
-51.9
91.8
-0.8
27.8
24.3
133.8
Opening cash
110.3
58.4
150.2
149.4
177.2
201.5
Closing cash
58.4
150.2
149.4
177.2
201.5
335.3
152.5
-245.5
187.4
184.3
451.9
658.1
FCF
FC SHEET
13
20th August 2010
COMPANY NOTE
EVEREST INDUSTRIES LTD.
BUY
KEY HIGHLIGHTS
CMP
`275
52 week High / Low
`271.50/100
`14.82 cr
Face Value
`10
Mkt. Capitalization
`407.55 cr
33993
BSE SENSEX
18257
NSE - NIFTY
5479
NSE Code
EVERESTIND
Bloomberg Code
EVI IN
BSE Code
508906
Providing complete building solutions: Everest has diversified its

presence into complete building solutions making foray into cladding,
flouring, walling and ceiling solutions. Its wide range of products enables it
to cater to all class of customers. Out of total capacity of 710000t, around
136000t capacity is installed for production of boards and panels. The
company commands 14% market share in the India.
Volume increase to improve profitability: Everest has increased its

fibre sheet capacity to 710000t. The company has set up a unit in
Bhagwanpur, Roorkee, a tax haven in Uttaranchal. The plant has fostered
EILs presence in the Northern market, which is lucrative for its entire
gamut of products in building solutions. We expect sales volume to increase
to 560000t and 630000t by FY11E and FY12E respectively. Improving
volumes and reducing cost to improve profitability increasing margin to
11% by FY12E.
Foray into steel building: Two years before Everest has entered into
steel building division and has executed around 350 projects and is now
established amongst architects, structural consultants, project divisions of
companies and leading contractors operating in industrial and logistics
sectors. The market today for PEB's in India is estimated at `3000 crores
with a 35% growth rate. Everests market share in the PEB market is 5%.
Current order book of the firm is around `120cr to be executed over 8-12
months. Furthermore EILs 5 manufacturing plants along with nearly 6000
retail outlets, ensures the company, pan India presence. This gives
competitive advantage for its steel building business.
Strong cash flow to fund capex: Everest Industries has spend `8cr on
its capex in FY10 and has scheduled around `20cr capex for the next year.
Strong operating cashflows to fund the capex keeping debt:equity ratio at a
comfortable level of 0.5:1. With asset turnover of 2:1 the firm is able to
generate high ROCE of 19%.
ATTRACTIVE VALUATION: We expect EIL to clog revenue CAGR of

30% over FY10-FT12E and PAT CAGR of 45% on account of improved
profitability of FC sheets. At the current price of `260 the stock is trading
at 8xFY11E and 7xFY12E earnings. EV/EBIDTA of the firm is at 4.9x and
4.2x of FY11E and FY12E EBIDTA respectively. Compelling valuations
store lot of potential for investors to make money going forward.
We recommend BUY with 12-month price target of `336.

Promoters
50.17%
Indian Institutions
09.25%
Public & Others
40.58%
6-MTS
YTD
1-YR
14%
71%
119%
NIFTY
5%
14%
16%
SENSEX
4%
14%
14%
EVEREST IND
(` mn)
BRIEF FINANCIALS
Net Sales
FY09
FY10
FY11E
FY12E
5,286.9 6,525.3 8,271.4 9,750.4
Sales growth
86.1%
23.4%
26.8%
EBITDA
489.4
603.7
900.3 1,069.7
PAT
144.5
283.8
471.3
570.3
EPS
17.9%
9.8
19.2
31.8
38.5
P/E (x)
28.2
14.3
8.6
7.1
RONW (%)
9.9%
17.5%
24.0%
23.1%
EV/EBITDA
9.1
7.1
4.9
4.2
ABHILASHA SATALE
66338900 EXT. 152
FC SHEET
14
20th August 2010
FINANCIALS
(` mn)
P & L A/c
Gross Sales
Excise Duty
Net Sales
% Change
FY07
FY08
FY09
FY10
FY11E
FY12E
3,257.9
3,070.1
5,520.1
6,809.0
8,581.4
10,090.4
234.3
229.9
233.2
283.7
310.0
340.0
3,023.6
2,840.2
5,286.9
6,525.3
8,271.4
9,750.4
19.9%
-6.1%
86.1%
23.4%
26.8%
17.9%
1,617.6
1,644.3
2,863.5
3,626.0
4,829.4
5,648.1
Stock Adjustments
(91.4)
(101.9)
(86.7)
(46.3)
Employee Expenses
257.9
318.5
484.2
630.2
722.0
780.0
Other Mfg Exp.
173.9
185.9
472.1
Raw Materials
64.9
74.5
92.0
Power, Oil & Fuel
119.1
169.9
204.5
579.0
790.0
527.9
493.8
670.6
453.7
9.4
1.3
5.8
272.1
125.1
174.8
1,258.0
1,240.7
1,462.6
1.0
35.0
45.6
2,759.5
2,658.9
4,797.5
5,921.6
7,371.1
8,680.7

Non Recurring
TOTAL EXPENDITURE
Operating Profit
264.1
181.3
489.4
603.7
900.3
1,069.7
% Change
-35.7%
-31.4%
169.9%
23.4%
49.1%
18.8%
12.7
19.8
31.0
80.3
88.0
97.0
17.7
122.7
16.9
EBITDA
294.5
323.8
537.3
684.0
988.3
1,166.7
% Change
-42.8%
9.9%
65.9%
27.3%
44.5%
18.1%
45.0
89.9
176.6
99.5
105.0
102.0
17.8
42.9
11.8
267.3
276.8
372.5
584.5
883.3
1,064.7
89.1
96.4
171.4
183.7
210.0
250.0
EBIT
205.4
227.4
365.9
500.3
778.3
916.7
PBT
178.2
180.4
201.1
400.8
673.3
814.7
% Change
Non Recurrng
Current Interest
Financial Charges
PBDT
Depreciation
-58.3%
1.2%
11.5%
99.3%
68.0%
21.0%
Current Tax
50.1
24.2
0.2
117.0
202.0
244.4
Deferred Tax
6.9
6.7
47.9
Fringe Benefit Tax
4.6
6.3
8.5
116.6
143.2
144.5
283.8
471.3
570.3
% Change
-62.5%
22.8%
0.9%
96.4%
66.1%
21.0%
(0.3)
69.8
9.2
116.9
73.4
135.3
283.8
471.3
570.3
(0.3)
69.8
9.2
Minority Interest
Adjusted PAT
116.9
73.4
135.3
283.8
471.3
570.3
% Change
-51.9%
-37.2%
84.3%
109.8%
66.1%
21.0%
59.2
59.2
37.0
18.7
18.7
Dividend - Equity
Preference
Retained Earnings
FC SHEET
57.4
84.0
107.5
283.8
452.6
551.6
15
20th August 2010
(` mn)
BALANCE SHEET
FY07
FY08
FY09
FY10
FY11E
FY12E
148.0
148.0
148.0
148.0
148.0
148.0
1,197.2
1,265.4
1,365.3
1,588.8
2,041.4
2,593.0
683.7
1,118.3
1,497.3
1,198.9
1,140.0
910.0
Preference
Reserves & Surplus
Revaluation Reserve
Others
Minority Interest
Short Term
Short Term
Total Liabilities
Gross Block
29.8
233.9
245.7
82.9
150.0
260.0
143.4
147.4
283.5
272.9
285.2
155.0
2,202.1
2,913.0
3,539.8
3,291.5
3,764.6
4,066.0
1,783.5
1,989.1
3,335.6
3,352.9
3,480.0
3,610.0
743.2
831.4
989.8
1,150.2
1,360.2
1,610.2
Net Block
1,040.3
1,157.7
2,345.8
2,202.7
2,119.8
1,999.8
Capital WIP
672.9
1,028.1
69.4
63.3
0.1
0.6
0.5
0.5
0.2
579.9
790.0
1,295.7
1,233.2
1,550.0
1,680.0
Lease Adjustments
Investments
Inventories
Debtors
104.0
68.9
238.4
231.9
263.0
320.0
Advances
537.3
202.7
361.1
451.2
553.0
760.0
1,221.2
1,061.6
1,895.2
1,916.3
2,366.0
2,760.0
421.5
563.2
998.2
963.6
1,120.0
1,250.0
498.1
102.2
101.9
144.6
110.0
190.0
Net Current Asssets
301.6
396.2
795.1
808.1
1,136.0
1,320.0
Cash & Bank
172.3
315.3
225.8
192.1
470.7
718.0
14.9
15.1
103.2
25.3
37.6
28.0
2,202.1
2,913.0
3,539.8
3,291.5
3,764.6
4,066.0

Provisions

Deffered Tax Asset
Total Assets
FC SHEET
16
20th August 2010
EXPENSE ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
53.5%
57.9%
54.2%
55.6%
58.4%
57.9%
50.5%
54.3%
52.5%
54.9%
58.4%
57.9%
3.9%
6.0%
3.9%
0.0%
7.0%
7.0%
8.5%
11.2%
9.2%
9.7%
8.7%
8.0%
5.8%
6.5%
8.9%
0.0%
0.0%
0.0%
17.5%
17.4%
12.7%
7.0%
0.0%
0.0%
9.0%
5.6%
4.2%
19.3%
15.0%
15.0%
MARGIN ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
Operating Margin(%)
8.7%
6.4%
9.3%
9.3%
10.9%
11.0%
EBITDA Margin(%)
9.7%
11.4%
10.2%
10.5%
11.9%
12.0%
PBDT Margin(%)
8.8%
9.7%
7.0%
9.0%
10.7%
10.9%
EBIT Margin(%)
6.8%
8.0%
6.9%
7.7%
9.4%
9.4%
PBT Margin(%)
5.9%
6.4%
3.8%
6.1%
8.1%
8.4%
PAT Margin(%)
3.9%
5.0%
2.7%
4.3%
5.7%
5.8%
EBIAT Margin(%)
4.8%
6.7%
5.9%
5.9%
7.0%
6.9%
ANALYSIS INPUTS
FY07
FY08
FY09
FY10
FY11E
FY12E
89.3
93.2
98.9
109.8
132.6
166.6
DPS
4.0
4.0
2.5
1.3
1.3
EPS
7.9
9.7
9.8
19.2
31.8
38.5
Adjusted EPS
7.9
5.0
9.1
19.2
31.8
38.5
S & D/ Net Sales
CEPS
13.9
16.2
21.3
31.6
46.0
55.4
5.7%
9.2%
5.6%
3.5%
4.5%
6.8%
1.7
1.4
1.6
1.9
2.4
2.7
30.7%
16.9%
4.3%
29.2%
29.2%
29.2%
FY07
FY08
FY09
FY10
FY11E
FY12E
1.52
2.07
1.93
1.90
2.31
2.42
0.53
0.96
1.15
0.74
0.59
0.43
3.2
2.1
1.8
3.9
5.5
6.6
8.8%
10.4%
9.9%
17.5%
24.0%
23.1%

Current Tax (%)

Dividend Payout (%)
50.8%
41.3%
25.6%
0.0%
4.0%
3.3%
Dividend Yield (%)
1.5%
1.5%
0.9%
0.0%
0.5%
0.5%
45.5
32.9
34.4
27.7
33.4
33.4
6.9
7.1
7.8
9.5
11.5
12.7
5.5
4.1
5.1
5.2
5.9
6.0
8.0
11.1
10.6
13.2
10.9
10.9
33.0
46.7
38.0
38.6
31.8
28.8
66.5
88.0
72.0
70.7
61.4
60.5
PRICE/ADJUSTED EPS
FY07
FY08
FY09
FY10
FY11E
FY12E
P/E
34.9
28.4
28.2
14.3
8.6
7.1
Price/CEPS
19.8
17.0
12.9
8.7
6.0
5.0
3.1
3.0
2.8
2.5
2.1
1.7
Price/Book Value
EV/EBITDA
16.6
15.1
9.1
7.1
4.9
4.2
Pay Back Period
23.8
20.4
15.5
10.5
7.2
6.0
FC SHEET
17
20th August 2010
(` mn)
CASH FLOW
FY07
FY08
Net profit
FY09
FY10
FY11E
FY12E
116.9
73.4
135.3
283.8
471.3
570.3
Depreciation
89.1
96.4
171.4
183.7
210.0
250.0
Deffered Tax
6.9
6.7
47.9
0.0
0.0
0.0
70.9
-94.6
-398.9
-13.0
-327.9
-184.0
283.8
81.9
-44.3
454.5
353.4
636.3
-667.7
-560.8
-387.8
-11.2
-63.8
-130.0
0.0
-0.5
0.1
0.5
-0.5
0.3
-667.7
-561.3
-387.7
-10.7
-64.3
-129.7
-59.2
-59.2
-37.0
0.0
-18.7
-18.7
0.0
0.0
0.0
0.0
0.0
0.0

Activities:
Capex
Investments (Net)
Dividend
Share Capital
0.0
0.0
0.0
0.0
0.0
0.0
Debt
481.0
638.7
390.8
-461.2
8.2
-120.0
421.8
579.5
353.8
-461.2
-10.5
-138.7
Others
5.9
-42.9
11.3
16.3
0.0
120.6
32.0
143.0
-89.5
-33.7
278.6
247.3
Opening cash
140.3
172.3
315.3
225.8
192.1
470.7
Closing cash
172.3
315.3
225.8
192.1
470.7
718.0
-383.9
-478.9
-432.1
443.3
289.6
506.3
Net change in cash
FCF
FC SHEET
18
20th August 2010
COMPANY NOTE
HYDERABAD INDUSTRIES LTD.
BUY
KEY HIGHLIGHTS
CMP
`625
52 week High / Low
`761/311
`7.49 cr
Face Value
`10
Mkt. Capitalization
`468.53 cr
36911
BSE SENSEX
18282
NSE - NIFTY
5486
NSE Code
HYDRBADIND
Bloomberg Code
HYI IN
BSE Code
509675
Largest player retaining its market share: Hyderabad Industries is the

largest player in FC industry with total capacity of 854500tpa. With growing
industry size the company is expected to retain its market share of 18%. In
the current financial year the company has expanded its FC capacity by
90000tpa. Thus, we expect Hyderabad industries to increase its sales
volume from 729000t in FY10 to 760000t in FY11E and to 811000t in
FY12E.
Strong brand name commands premium: The firm has wellestablished brand Charminar. Being well-penetrated the brand fetches 1015% premium to other brands. Thus, the realization for the firm has been
better than its peers. We expect realization for FC Sheet to increase from
`8300/t in FY10 to `9000/t and `9400/t for FY11E and FY12E respectively.
Diversification to benefit: Diversification into allied products to benefit

the company. Hyderabad Industries has diversified into autoclave concrete
blocks, building panel, refractory and FC pipes. These businesses contribute
less than 20% of its topline. The firm markets its building panels and AACB
under the brand name Aerocon and refractory under the name Hysil. The
allied business to provide cushion in the downturn of the cycle.
Capacity expansion to reap benefits: HIL is expanding its capacity in

AACB and thermal insulation. It is expanding its AACB capacity to 2.2 lakh
Cu. Mtr. by Q1FY11E. It is setting up a new plant in Golan, Surat from which
it would cater to the high growth and lucrative markets of Gujarat and
Maharashtra. The capacity of thermal insulation business, which is high
margin business, is expected to expand to 9300t by Q2FY11E.
Strong operating cash flows: HIL has generated strong cash flows in the
past 6 years and we expect it to generate cash flow of around `100cr over
next two years. Strong cash flow and low debt level of 0.2:1 generates very
high ROCE of around 25% which is the highest in the industry.
VALUATION: At the current price of `625 the stock is available at 5.2x

and 4.3x FY11E and FY12E earnings respectively. Due to low debt level
EV/EBIDA is at very compelling level of 3x and 2.5x of FY11E and FY12E
EBIDTA respectively. The leader to benefit from the long lasting
boom in the industry. We recommend BUY on the stock with
12 month price target of `808.

Promoters
43.10%
Indian Institutions
09.60%
Public & Others
47.30%
6-MTS
YTD
1-YR
-9%
13%
76%
NIFTY
5%
14%
16%
SENSEX
4%
14%
14%
HYD IND
(` mn)
BRIEF
FINANCIALS
Net Sales
FY08
FY09
FY10E
FY11E
6,234.0 7,036.9 8,522.7 9,963.3
Sales growth
29.6%
EBITDA
886.3 1,507.9 1,599.5 1,909.0
12.9%
21.1%
16.9%
PAT
440.9
870.2
920.4 1,096.9
EPS
59.1
116.6
123.4
147.0
P/E (x)
10.8
5.5
5.2
4.3
RONW (%)
27.0%
40.6%
32.5%
30.3%
EV/EBITDA
5.3
3.2
3.0
2.5
ABHILASHA SATALE
66338900 EXT. 152
FC SHEET
19
20th August 2010
FINANCIALS
(` mn)
P & L A/c
FY07
FY08
FY09
FY10
FY11E
FY12E
Gross Sales
4,765.1
5,234.7
6,639.7
7,563.7
9,188.0
10,660.0
Excise Duty
398.3
425.1
405.7
526.8
665.4
696.7
4,366.8
4,809.6
6,234.0
7,036.9
8,522.7
9,963.3
-2.3%
10.1%
29.6%
12.9%
21.1%
16.9%
Raw Materials
2,552.6
2,649.4
3,000.6
3,617.0
3,692.3
4,192.7
Stock Adjustments
(308.9)
(56.1)
292.3
(333.8)
Employee Expenses
364.2
387.4
484.5
562.2
674.0
780.0
Other Mfg Exp.
169.0
229.2
252.2
86.6
106.6
125.2
Power, Oil & Fuel
378.2
394.9
435.5
596.6
790.0
689.9
600.8
544.2
Net Sales
% Change

Non Recurring
TOTAL EXPENDITURE
30.5
0.5
28.3
126.2
141.4
155.5
1,683.6
1,960.2
2,291.6
8.7
3.2
29.4
4,097.0
4,457.3
5,347.7
5,529.0
6,923.1
8,054.3
Operating Profit
269.8
352.3
886.3
1,507.9
1,599.5
1,909.0
% Change
-59.7%
30.6%
151.6%
70.1%
6.1%
19.3%
39.2
38.3
39.8
40.5
40.0
40.0
7.3
17.4
2.2
EBITDA
Non Recurrng
316.3
408.0
928.3
1,548.4
1,639.5
1,949.0
% Change
-56.0%
29.0%
127.5%
66.8%
5.9%
18.9%
50.0
77.8
94.2
62.5
65.0
67.0
Current Interest
Financial Charges
PBDT
Depreciation
266.3
330.2
834.1
1,485.9
1,574.5
1,882.0
95.6
111.2
139.8
155.5
180.0
220.0
220.7
296.8
788.5
1,392.9
1,459.5
1,729.0
PBT
170.7
219.0
694.3
1,330.4
1,394.5
1,662.0
% Change
-71.0%
28.3%
217.0%
91.6%
4.8%
19.2%
Current Tax
59.6
43.3
223.5
460.2
474.1
565.1
Deferred Tax
19.0
29.8
23.9
5.0
5.1
6.0
87.1
140.8
440.9
870.2
920.4
1,096.9
-76.1%
61.7%
213.1%
97.4%
5.8%
19.2%
EBIT
Fringe Benefit Tax

% Change
Minority Interest
(22.5)
4.1
(7.5)
109.6
136.7
448.4
870.2
920.4
1,096.9
(22.5)
4.1
(7.5)
Adjusted PAT
109.6
136.7
448.4
870.2
920.4
1,096.9
% Change
-71.3%
24.7%
228.0%
94.1%
5.8%
19.2%
37.3
37.3
74.6
147.2
155.7
185.6
49.8
103.5
366.3
723.0
764.7
911.3
Dividend - Equity
Preference
Retained Earnings
FC SHEET
20
20th August 2010
(` mn)
BALANCE SHEET
Preference
Reserves & Surplus
Revaluation Reserve
Others
Minority Interest
Short Term
Short Term
FY07
FY08
FY09
FY10
FY11E
FY12E
74.6
74.6
74.6
74.6
74.6
74.6
55.7
54.0
52.3
52.3
52.3
52.3
1,287.5
1,381.2
1,734.8
2,405.5
3,117.8
3,976.9
541.6
703.1
468.4
468.4
510.0
510.0
211.5
214.6
334.8
230.0
230.0
350.0
203.9
209.3
230.0
215.0
163.0
185.0
2,374.8
2,636.8
2,894.9
3,445.8
4,147.7
5,148.8
Gross Block
2,298.6
2,383.6
2,822.1
3,120.0
3,450.0
3,820.0
1,004.3
1,091.4
1,224.1
1,379.6
1,559.6
1,779.6
Net Block
1,294.3
1,292.2
1,598.0
1,740.4
1,890.4
2,040.4
Capital WIP
26.4
229.9
365.3
512.0
322.0
360.0
95.7
94.5
93.4
110.0
350.0
430.0
1,151.4
1,134.8
1,115.3
1,220.0
1,580.0
1,780.0
Debtors
389.2
478.9
506.1
610.0
796.0
910.0
Advances
287.3
220.7
190.3
273.0
365.0
552.0
1,827.9
1,834.4
1,811.7
2,103.0
2,741.0
3,242.0
817.5
919.0
975.2
1,020.0
1,180.0
1,260.0
185.3
103.9
145.7
185.0
272.0
190.0
825.1
811.5
690.8
898.0
1,289.0
1,792.0
64.6
162.8
104.6
164.4
270.4
467.4
68.7
45.9
42.8
21.0
25.9
59.0
2,374.8
2,636.8
2,894.9
3,445.8
4,147.7
5,148.8
Total Liabilities
Lease Adjustments
Investments
Inventories

Provisions
Net Current Asssets
Cash & Bank
Deffered Tax Asset
Total Assets
FC SHEET
21
20th August 2010
EXPENSE ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
58.5%
55.1%
48.1%
51.4%
43.3%
42.1%
51.4%
53.9%
52.8%
46.7%
43.3%
42.1%
8.7%
8.2%
7.0%
0.0%
7.0%
7.0%

8.3%
8.1%
7.8%
8.0%
7.9%
7.8%
3.9%
4.8%
4.0%
0.0%
0.0%
0.0%
15.8%
12.5%
8.7%
0.0%
0.0%
0.0%
3.1%
3.0%
3.0%
23.9%
23.0%
23.0%
MARGIN ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
Operating Margin(%)
6.2%
7.3%
14.2%
21.4%
18.8%
19.2%
EBITDA Margin(%)
7.2%
8.5%
14.9%
22.0%
19.2%
19.6%
PBDT Margin(%)
6.1%
6.9%
13.4%
21.1%
18.5%
18.9%
EBIT Margin(%)
5.1%
6.2%
12.6%
19.8%
17.1%
17.4%
PBT Margin(%)
3.9%
4.6%
11.1%
18.9%
16.4%
16.7%
PAT Margin(%)
2.0%
2.9%
7.1%
12.4%
10.8%
11.0%
EBIAT Margin(%)
3.1%
4.5%
8.6%
13.3%
11.6%
11.7%
ANALYSIS INPUTS
FY07
FY08
FY09
FY10
FY11E
FY12E
175.9
188.9
218.8
287.5
380.2
485.5
S & D/ Net Sales
DPS
5.0
5.0
10.0
19.7
20.9
24.9
EPS
11.7
18.9
59.1
116.6
123.4
147.0
Adjusted EPS
14.7
18.3
60.1
116.6
123.4
147.0
CEPS
24.5
33.8
77.8
137.5
147.5
176.5
1.6%
2.6%
2.5%
2.4%
3.1%
4.6%
1.9
2.0
2.2
2.3
2.5
2.6
37.8%
22.1%
33.1%
34.6%
34.0%
33.0%
FY07
FY08
FY09
FY10
FY11E
FY12E
1.9
2.0
1.7
1.9
2.1
2.6
0.6
0.6
0.4
0.3
0.2
0.2
2.7
2.8
5.7
14.9
15.2
17.4
6.6%
10.0%
27.0%
40.6%
32.5%
30.3%

Current Tax (%)

Dividend Payout (%)
42.8%
26.5%
16.9%
26.5%
26.5%
26.5%
Dividend Yield (%)
0.8%
0.8%
1.6%
3.2%
3.3%
4.0%
11.2
11.1
12.7
12.6
12.1
11.7
11.9
10.4
11.9
13.2
13.5
13.8
4.5
4.2
5.5
6.0
6.1
5.9
32.6
32.9
28.8
28.9
30.1
31.2
30.8
35.2
30.6
27.7
27.0
26.4
80.5
86.7
65.9
60.6
60.0
61.5
PRICE/ADJUSTED EPS
FY07
FY08
FY09
FY10
FY11E
FY12E
P/E
53.5
33.1
10.6
5.4
5.1
4.3
Price/CEPS
25.5
18.5
8.0
4.5
4.2
3.5
3.6
3.3
2.9
2.2
1.6
1.3
EV/EBITDA
15.1
11.7
5.2
3.1
2.9
2.5
Pay Back Period
26.2
19.0
8.2
4.7
4.3
3.6
Price/Book Value
FC SHEET
22
20th August 2010
(` mn)
CASH FLOW
FY07
Net profit
FY08
FY09
FY10
FY11E
FY12E
109.6
136.7
448.4
870.2
920.4
1096.9
Depreciation
95.6
111.2
139.8
155.5
180.0
220.0
Deffered Tax
19.0
29.8
23.9
0.0
0.0
0.0
-290.6
13.6
120.7
-207.2
-391.0
-503.0
-66.4
291.3
732.8
818.5
709.4
813.9
(156.5)
(288.5)
(573.9)
(444.6)
(140.0)
(408.0)
84.9
1.2
1.1
(16.6)
(240.0)
(80.0)

Activities:
Capex
Investments (Net)
Dividend
Share Capital
(71.6)
(287.3)
(572.8)
(461.2)
(380.0)
(488.0)
(37.3)
(37.3)
(74.6)
(147.2)
(155.7)
(185.6)
3.1
Debt
155.2
164.6
(114.5)
(104.8)
41.6
120.0
121.0
127.3
(189.1)
(252.0)
(114.1)
(65.6)
Others
(14.9)
33.1
29.1
45.5
109.2
63.4
Net change in cash
(2.1)
98.2
(58.2)
59.8
106.1
196.9
Opening cash
66.7
64.6
162.8
104.6
164.4
270.4
Closing cash
64.6
162.8
104.6
164.4
270.4
467.3
(222.9)
2.8
158.9
373.9
569.4
405.9
FCF
FC SHEET
23
20th August 2010
COMPANY NOTE
VISAKHA INDUSTRIES LTD.
BUY
CMP
KEY HIGHLIGHTS
`162.75
52 week High / Low
`192.95/108.10
`15.92 cr
Face Value
`10
Mkt. Capitalization
`259.098 cr
`32135 cr
BSE SENSEX
18257
NSE - NIFTY
5479
NSE Code
VISAKAIND
Bloomberg Code
VSKI IN
BSE Code
509055
Aggressive expansion in FC sheets to benefit: Visaka gets first mover

advantage to accrue additional market share in the industry boom due to
timely expansion. In the current financial year the firm has expanded its
capacity by 48000t at its Pune plant taking total capacity to 100000t at
Pune. It is further expanding its capacity by 120000t at Sambalpur pant,
which is expected to get commenced by January 2011.
Volume increase through strong brand: Ongoing expansion and

strong demand and brand name to give Visaka consistent volume growth.
We expect Visaka to increase its sales volume from 557965t in FY10 to
665000t in FY11E and 690000t in FY12E. Rising volumes with rising
realization to improve profitability of the firm by maintaining margins at
18%.
Textile boom to benefit: Visaka Industries has blended yarn division with
total capacity of 1816 spindles. The division contributes around 18% of total
turnover. Yarn prices have moved up 40% y-o-y in FY10. Due to strong
demand and capacity consolidation witnessed in the global market yarn
prices are likely to stay firm in near future. We expect the division to grow
at 20% CAGR over next two years.
Strong cash flow to fund capex: Visaka Industries is expected to

generate Free Cash Flow of `40cr in FY10 and `60cr in FY11E. This would
take care of its Sambalpur expansion of `41cr. Visaka is expected to repay
around `20cr debt in FY11E. However, strong cash flow is expected to
keep debt:equity ratio at 0.4:1 level.
Improving ROCE: Improving profitability and reducing debt level to

improve ROCE to 20% from 15% in FY09. Upturn in the industry cycle
ensures the sustainability of ROCE over medium term.
ATTRACTIVE VALUATION: We expect Visaka Industries to expand its

revenue at a CAGR of 15% over FY10-FY12E and earnings at a CAGR of
14% over the same period. At the current price of `163 the stock is
trading at 4xFY11E and 3.5xFY12E earnings. EV/EBIDTA of the
firm is at 3x and 2.6x of FY11E and FY12E EBIDTA respectively.
We recommend BUY at current price.

Promoters
37.70%
Indian Institutions
05.06%
Public & Others
57.24%
6-MTS
YTD
1-YR
-14%
32%
41%
NIFTY
5%
14%
16%
SENSEX
4%
14%
14%
VISAKA
(` mn)
FY09
BRIEF FINANCIALS
Net Sales
FY10 FY11E FY12E
5,779.8 5,981.3 7,226.2 7,805.1
Sales growth
34.4%
EBITDA
789.5 1,088.1 1,288.0 1,362.1
PAT
359.4
572.1
684.6
729.3
EPS
22.6
36.0
43.1
45.9
P/E (x)
3.5%
20.8%
8.0%
7.2
4.5
3.8
3.5
RONW (%)
20.7%
27.0%
25.8%
22.3%
EV/EBITDA
4.1
3.2
2.8
2.6
ABHILASHA SATALE
66338900 EXT. 152
FC SHEET
24
20th August 2010
FINANCIALS
(` mn)
P & L A/c
FY07
FY08
FY09
FY10
FY11E
FY12E
Gross Sales
4,451.9
4,595.7
6,063.5
6,393.1
7,706.2
8,325.1
Excise Duty
278.8
295.2
283.7
411.8
480.0
520.0
4,173.1
4,300.5
5,779.8
5,981.3
7,226.2
7,805.1
42.5%
3.1%
34.4%
3.5%
20.8%
8.0%
Net Sales
% Change
Raw Materials
2,374.6
2,748.9
2,958.3
3,362.2
3,726.0
4,030.0
Stock Adjustments
(17.4)
(200.5)
308.6
(258.1)
Employee Expenses
202.1
219.5
224.8
239.2
286.8
330.0
Other Mfg Exp.
157.8
167.1
247.9
311.7
375.8
405.9
37.5
42.7
64.6
67.7
72.0
78.0
Power, Oil & Fuel
240.6
242.6
259.0
295.5
433.6
468.3
482.6
493.0
696.7
714.8
863.6
932.8

Non Recurring
TOTAL EXPENDITURE
0.9
14.6
47.6
28.3
36.0
42.0
116.4
128.4
108.2
130.0
144.5
156.1
47.8
74.6
1.9
3,595.1
3,904.1
4,990.3
4,893.2
5,938.2
6,443.0
Operating Profit
578.0
396.4
789.5
1,088.1
1,288.0
1,362.1
% Change
21.5%
-31.4%
99.2%
37.8%
18.4%
5.8%
52.5
64.5
114.4
61.1
40.5
40.0
1.1
22.4
EBITDA
Non Recurrng
631.6
460.9
903.9
1,171.6
1,328.5
1,402.1
% Change
22.8%
-27.0%
96.1%
29.6%
13.4%
5.5%
Current Interest
121.7
157.2
170.2
109.3
97.0
109.0
Financial Charges
22.0
15.2
13.4
14.7

PBDT
487.9
288.5
720.3
1,047.6
1,231.5
1,293.1
Depreciation
147.6
156.6
166.0
183.9
210.0
205.0
EBIT
484.0
304.3
737.9
987.7
1,118.5
1,197.1
PBT
340.3
131.9
554.3
863.7
1,021.5
1,088.1
% Change
17.0%
-61.2%
320.2%
55.8%
18.3%
6.5%
Current Tax
91.7
57.0
173.2
284.8
336.8
358.8
Deferred Tax
11.1
(6.1)
16.1
6.8
4.7
4.3
5.6
Fringe Benefit Tax

232.8
76.7
359.4
572.1
684.6
729.3
% Change
20.9%
-67.1%
368.6%
59.2%
19.7%
6.5%
Minority Interest
0.1
(21.0)
(26.2)
(12.4)
232.7
97.7
385.6
584.5
684.6
729.3
0.1
(21.0)
(26.2)
(12.4)
Adjusted PAT
232.7
97.7
385.6
584.5
684.6
729.3
% Change
20.8%
-58.0%
294.7%
51.6%
17.1%
6.5%
41.6
47.6
63.5
79.4
93.0
99.1
0.6
190.6
29.1
295.9
492.7
591.6
630.2
Dividend - Equity
Preference
Retained Earnings
FC SHEET
25
20th August 2010
(` mn)
BALANCE SHEET
FY07
FY08
FY09
FY10
FY11E
FY12E
158.8
158.8
158.8
158.8
158.8
158.8
Preference
Reserves & Surplus
Revaluation Reserve
Others
Minority Interest
Short Term
Short Term
1,400.2
1,433.7
1,718.7
2,198.1
2,789.7
3,420.0
1,689.2
1,815.7
1,508.3
1,165.5
1,165.5
1,165.5
172.5
164.8
179.2
454.8
250.0
250.0
103.9
102.7
121.9
126.2
62.0
3,524.6
3,675.7
3,686.9
4,103.4
4,426.0
4,994.3
2,688.3
2,699.6
3,123.4
3,309.8
3,750.0
4,050.0
826.2
977.3
1,140.9
1,232.2
1,442.2
1,647.2
Net Block
1,862.1
1,722.3
1,982.5
2,077.6
2,307.8
2,402.8
Capital WIP
35.0
372.7
105.1
91.6
130.0
50.0
12.5
22.2
23.0
31.0
35.0
Inventories
799.6
940.6
899.7
1,166.7
1,420.0
1,570.0
Debtors
473.7
536.5
531.3
507.6
690.0
780.0
Advances
633.4
635.9
659.2
782.6
840.0
960.0
1,906.7
2,113.0
2,090.2
2,456.9
2,950.0
3,310.0
408.5
476.7
503.1
571.9
630.0
830.0
327.0
370.0
474.6
589.0
690.0
190.0
1,171.2
1,266.3
1,112.5
1,296.0
1,630.0
2,290.0
442.9
308.5
455.6
608.7
318.2
210.5
1.3
6.3
9.4
6.5
9.0
6.0
3,525.0
3,676.1
3,687.3
4,103.4
4,426.0
4,994.3
Total Liabilities
Gross Block
Lease Adjustments
Investments

Provisions
Net Current Asssets
Cash & Bank
Deffered Tax Asset
Total Assets
FC SHEET
26
20th August 2010
EXPENSE ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
56.9%
63.9%
51.2%
56.2%
51.6%
51.6%
59.3%
56.5%
51.9%
51.6%
51.6%
0.0%
5.8%
5.6%
4.5%
4.9%
6.0%
6.0%

4.8%
5.1%
3.9%
4.0%
4.0%
4.2%
3.8%
3.9%
4.3%
5.2%
5.2%
5.2%
S & D/ Net Sales
11.6%
11.5%
12.1%
12.0%
12.0%
12.0%
56.9%
63.9%
51.2%
56.2%
51.6%
51.6%
MARGIN ANALYSIS
FY07
FY08
FY09
FY10
FY11E
FY12E
Operating Margin(%)
13.9%
9.2%
13.7%
18.2%
17.8%
17.5%
EBITDA Margin(%)
15.1%
10.7%
15.6%
19.6%
18.4%
18.0%
PBDT Margin(%)
11.7%
6.7%
12.5%
17.5%
17.0%
16.6%
EBIT Margin(%)
11.6%
7.1%
12.8%
16.5%
15.5%
15.3%
PBT Margin(%)
8.2%
3.1%
9.6%
14.4%
14.1%
13.9%
Adjusted PAT Margin(%)
5.6%
2.3%
6.7%
9.8%
9.5%
9.3%
13.9%
9.2%
13.7%
18.2%
17.8%
17.5%
FY07
FY08
FY09
FY10
FY11E
FY12E
75.9
99.2
109.3
133.3
167.0
205.5
DPS
2.6
3.0
4.0
5.0
5.9
6.2
EPS
14.7
4.8
22.6
36.0
43.1
45.9
Adjusted EPS
14.7
6.2
24.3
36.8
43.1
45.9
Operating Margin(%)
ANALYSIS INPUTS
CEPS
24.0
14.7
33.1
47.6
56.3
58.8
10.5%
9.8%
10.7%
9.5%
4.5%
1.6%
1.6
1.6
1.9
1.8
1.9
1.9
28.3%
46.5%
32.3%
33.0%
33.0%
33.0%
FY07
FY08
FY09
FY10
FY11E
FY12E
3.2
2.9
2.6
2.6
2.5
3.5
1.2
1.2
0.9
0.7
0.5
0.4
3.1
1.6
3.2
6.4
8.1
7.7
19.3%
4.9%
20.7%
27.0%
25.8%
22.3%
Dividend Payout (%)
17.9%
62.1%
17.7%
13.9%
13.6%
13.6%
1.6%
1.8%
2.5%
3.1%
3.6%
3.8%
8.3
8.1
11.1
10.0
9.8
20.0

Current Tax (%)
Dividend Yield (%)

9.8
9.0
11.0
9.5
10.5
11.0
4.8
4.7
5.6
4.6
4.8
9.9
44.2
45.3
32.8
36.5
37.1
18.2
37.4
40.8
33.3
38.4
34.9
33.2
76.1
78.1
65.2
78.9
75.5
36.7
FY07
FY08
FY09
FY10
FY11E
FY12E
11.1
33.7
7.2
4.5
3.8
3.5
Price/CEPS
6.8
11.1
4.9
3.4
2.9
2.8
Price/Book Value
2.1
1.6
1.5
1.2
1.0
0.8
PRICE/ADJUSTED EPS
P/E
EV/EBITDA
6.0
8.2
4.2
3.2
2.8
2.7
Pay Back Period
9.9
16.1
7.2
5.0
4.2
4.0
FC SHEET
27
20th August 2010
(` mn)
CASH FLOW
FY07
FY08
FY09
FY10
FY11E
FY12E
Net profit
232.7
97.7
385.6
584.5
684.6
729.3
Depreciation
147.6
156.6
166.0
183.9
210.0
205.0
Deffered Tax
11.1
-6.1
16.1
6.8
0.0
0.0
-457.7
-95.1
153.8
-183.5
-334.0
-660.0

Activities:
-66.3
153.1
721.5
591.7
560.6
274.3
Capex
547.5
349.0
156.2
172.9
478.6
220.0
12.4
-12.5
22.2
0.8
8.0
4.0
559.9
336.5
178.4
173.7
486.6
224.0
Dividend
-42.2
-47.6
-63.5
-79.4
-93.0
-99.1
27.1
0.0
0.0
0.0
0.0
0.0
Investments (Net)
Share Capital
6.0
7.0
8.0
9.0
10.0
11.0
Debt
352.7
118.8
-293.0
-67.2
-204.8
0.0
337.6
71.2
-356.5
-146.6
-297.8
-99.1
Others
580.9
695.2
396.3
465.7
1039.9
506.9
Net change in cash
250.3
-134.4
147.1
153.1
-290.5
-107.7
Opening cash
192.6
442.9
308.5
455.6
608.7
318.2
Closing cash
442.9
308.5
455.6
608.7
318.2
210.5
FC SHEET
28
20th August 2010
Corporate Office:
Manu Mansion, 2nd Floor, 16, Shahid Bhagatsingh Marg, Fort, Mumbai 400 001. Tel. 91-226633 8900 / 2261 8787 / 4027 8900
Fax No. 91-22 2269 0041
Email: research@technogroup.co.in
website: www.technoworld.in
Strictly for Private Circulation only. All rights reserved. Techno Shares & Stocks Ltd
DISCLAIMER: This information & opinions in this report have been prepared by TECHNO SHARES & STOCKS LTD. The report & the
information contained herein are strictly confidential and meant solely for the authorized recipient and may be restricted by law or regulation in
certain countries. This report is for information purposes only for the authorized reader and does not construe to be any investment, legal or
taxation advice. This report is based on the information obtained from public sources and sources believed to be reliable, however, no warranty,
express or implied, are given for the accuracy or correctness of the same and it should not be construed as such. It is also not intended as an offer
or solicitation for the purchase and sale of any financial instrument.
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preparation/issuance of this report may have (a) from time to time, any interest or positions (buy/sell etc.) financial (including in
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FC SHEET
29
20th August 2010

FC Sheet-Techno Industry Report

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TECHNO SHARES & STOCKS LTD

20th AUGUST 2010

FIBER CEMENT SHEET INDUSTRY REPORT

This Page is Intentionally Left Blank

EVEREST INDUSTRIES LTD.

HYDERABAD INDUSTRIES LTD.

Governments thrust on rural housing: In just 5years from 2006-07 to

VISAKHA INDUSTRIES LTD.

Warehousing- Big opportunity: The development of organized retail in

Rural boom to benefit: Rural consumer enjoys rising disposable income

Sustainable growth: Rural boom, rising warehousing are growth potentials

Reducing cost increasing margins: Reducing cement prices to reduce cost

Valuations not factoring future potentials: Inspite of strong growth

20th August 2010

Sampoorna Gramin Rozgar Yojana

Swarnajayanti Gram Swarozgar Yojana

Source : Economic Survey

Houses constructed (Units)

Job cards issued (Crores)

Employment provided to households (Crores)

Source : Economic Survey

Source : Economic Survey

20th August 2010

FC Sheet demand (lakh tonne) and growth (%)

2004-05 2005-06 2006-07 2008-09 2009-10 2010-11

Source : Industry,Techno Estimate

WAREHOUSING- BIG OPPORTUNITY

Source : Industry,Techno Estimates

20th August 2010

FC sheet-PREFERRED ROOFING OVER ITS ALTERNATIVES

Comparison of other sheets with FC sheet chart.

Life Span (years)

RED CLAY TILES

REDUCING CEMENT PRICES TO BENEFIT

20th August 2010

ASBESTOS CEMENT FIBRE

ASBESTOS CEMENT FIBRE

ASBESTOS CEMENT FIBRE

BUILDING PANELS &

TEXTILE YARN (SPINDLES)

TEXTILE YARN (SPINDLES)

GROWTH MARGINS & RETURNS

20th August 2010

Source : Economic Survey

920.4 1096.9 123.4

20th August 2010

RAMCO INDUSTRIES LTD.

52 week High / Low

Equity Cap (current)

Avg. Daily Vol. (12 M)

Gaining market share through aggressive expansion: Ramco is

Geographical reach widening: Ramco currently operates through 7

Sri Lankan operations to contribute: Ramco Industries has operations

Textile business to flourish: Ramco with 43296 spindles capacity spins

Hiving off plastic division- a positive move: The managements move

Strong cash flow to fund capex: Ramco Industries is expected to

Improving ROCE: Improving profitability and reducing debt level to

ATTRACTIVE VALUATION: We expect Ramcos sales to increase at a

SHAREHOLDING PATTERN @ 30-06-10

Public & Others

4,528.7 5,286.1 6,304.8 7,715.1

868.3 1,430.2 1,713.4

20th August 2010

Other Mfg Exp.