SUZLON ENERGY Q3 FY2009-10 RESULT INSIGHTS

NET DEBT REDUCTION- Q3 FY 10
-Consolidated net debt as on 31st March 2009 - Rs. 11800 cr.
-Consolidated net debt as on 31st December 2009 - Rs. 10488 cr.
-Net consolidated debt reduced by Rs. 1312 cr.
-Profit from the Sale of 35.22% OF HANSEN TRANSMISSION Rs. 252 cr.
-GROSS REDUCTION OF DEBT BY APPROX. 15% OR USD 350 MILLION.
-Acquition loan of USD 780 million PAID-OFF.
-HANSEN STAKE NOW AT 26.06%. (174632079 voting rights)
-REpower Systems AG stake now at 90.71%.

SALES FIGURES- Q3 FY 10
-India contributed 140 Mw v/s 168 Mw in Q3 FY 2008-09.
-Internationally, volumes were 264 Mw v/s 511 Mw in Q3 FY 2008-09.
-Total Mw Sales (Suzlon Wind) - 404 Mw v/s 679 Mw.

ORDER BOOK – Q3FY 10
-As on 30th January 2010 – 1484 Mw.
-Order book value as on 30th January 2010 – Rs. 8128 cr.
-Average realisation of Order Book -
INDIA – Rs. 5.43 cr/Mw.
INTERNATIONAL – Rs. 5.49 cr/Mw.

REVENUE - Q3 FY 10
-Suzlon Wind Business Revenue – Rs. 2453 cr.
-Consolidated Revenue – Rs. 5590 cr.
-Income from operation & maintance activities-
India – Rs. 196 cr
International – Rs. 83 cr.
-Karnataka wind energy tariff Rs. 3.70/Kwh from Rs. 3.40.
-Gujarat wind energy tariff Rs. 3.56/Kwh from Rs. 3.50/Kwh.
-Global Market Share – Suzlon – 9%; RE power - 3.3%; GE wind – 18.6%; Vestas – 19.8%; Siemens – 6.9% as on 31st December 2008.

OTHER FINANCIAL DETAILS -
-Net operating working capital as on 31st December 2009 – Rs. 5179 cr.
-Absolute reduction of working capital of Rs. 974 cr from March 2009 levels.
-Acquition Loans – Rs. 2159 cr.
-FCCBs – Rs. 2229 cr.
-Capex Loans – Rs. 1077 cr.
-Working Capital & Other Loans – Rs. 5009 cr.
-Gross External Debt – Rs. 10474 cr
-Loans from Promoter group – Rs.1175 cr.
-Cash Holdings – Rs.1041 cr.
-NET DEBT – Rs. 10608 cr.
-NET EXTERNAL DEBT – Rs.9433 cr.
-Gross Profit/Mw - 9m FY 2009-10 – Rs. 2.03 cr v/s Rs. 2.07 cr in 9m FY 08-09.

DEBT MANAGEMENT EXERCISE –
- DEBT REDUCTION –
- Monetized 35.22 % stake in Hansen Transmission, realized GBP 224 millions through placement of 236 million Depository interest at a price of 95 pence per depository interest, proceeds used to repay part of acquisition loans.
- Refinancing of loans in Rupee-denomination from SBI.
- Holiday of 2 years in principal payments done.
- Issue of GDRs for USD 108 million (Q2 FY 2009-10)
- Cash infusion of USD 94 million through additional Convertible Bonds issue (Q2 FY 2009-10)

CAPACITY & EXPANSION PLANS –

SUZLON (GDR- SUEL:LI Suzlon Energy Ltd)
CURRENT CAPACITY- 4200 Mw
EXPANSION PLANNED- 1500 Mw
TOTAL POST EXPANSION- 5700 Mw

RE POWER SYSTEMS AG - RPW:GR
CURRENT CAPACITY- 1250 Mw
EXPANSION PLANNED- 450 Mw
TOTAL POST EXPANSION- 1700 Mw

HANSEN Transmissions International NV - HSN:LN
CURRENT CAPACITY- 7300 Mw (Gearbox)
EXPANSION PLANNED- 8000 Mw (Gearbox)
TOTAL POST EXPANSION- 14300 Mw (Gearbox)

RESULTS- Suzlon Energy Posts Profits for Q3 FY10

SUZLON ENERGY has announced its Q3 results of FY10. It has reported Consolidated Net Profit of Rs 14.1 crs as against loss of Rs 34.9 crs, QoQ, boosted by profit on stake sale of Hansen booked Rs 251.96 cr.

Consolidated Total Revenues declined to Rs 5,608 crs from Rs 6,943 crs. Income from Operations slipped to Rs 5,590 crs from Rs 6,920 crs.

Suzlon's Net Debt stood at Rs 10,488 crs as on December 31, 2009.

EBIDTA (earning before interest, depreciation, tax and amortisation) was down to Rs 274.6 crs from Rs 724.7 crs.

Adjusted losses without extraordinary was at Rs 221.1 crs v/s loss of Rs 340 crs, QoQ.

Interest expenses were still steady at Rs 289.5 crs v/s Rs 233.85 crore.

Highlights

-Sale of 404 MW v/s expectations of 470-480 MW

-Better sales QoQ at 404 MW v/s 283 MW

-Low volumes hit margins to make operating loss in standalone in wind business

-Operating loss of Rs 74 crs v/s Rs 149 crs

-Order book inflow still weak; added 399 MW in Q3 with only 68 MW from international markets

-No orders from the Chinese and European markets during the quarter

-Order backlog flat QoQ at 1484 MW

-Net debt reduced by Rs 3274 crs from Rs 13,762 crs to Rs 10488 cr by end December.

-Rupee refinancing progressing well; nearly 80% tied-up and full closure expected by end-February 2010

Management says

-Strong revival seen in Indian wind market; 

-New policy initiatives support long-term growth; 

-Order wins from PSUs and large corporates: ACC, GACL, GAIL, ITC, RSMML, among others

HANSEN

-Revenues down 12.1% to Euro 137 million; margins at 9.8% vs 12.9% YoY; QoQ better with improvement from cost control

-Reduction in scheduled deliveries of both industrial and wind turbine gearboxes

-Company says: customers are continuing to defer deliveries of the gearboxes with stricter control of inventories in line with the current operating and credit environment

-Scaled down FY10 guidance implies 40% decline in Q4 revenues

-Upswing in market is expected from July-Sept Quarter

REPOWER

-Flat revenues of Euro315 million v/s Euro 312 million 

-EBIT at Euro 25 million v/s Euro 15 million 

-Margins at 7.9% v/s 4.9%

-Final numbers on February 12, 2010

MY STOCK PICK: GILLETTE INDIA

As we all know that India is enjoying the demographic dividend, as more than 40% of Indian population is between the age group of 20 – 40 years, and with the population of 1.18 billion in India a 40% means nearly 47.2 cr people are young and if we assume that from this young population minus females needs shaving kit every morning then for next 20-30 years the consumption & sales of these products would be growing Right!! and the company would be delivering consistent performance.But this is just an assumption..what product am I talking about….. It’s GILLETTE!!BSE CODE - 507815

Gillette India is an NSE BSE listed company jointly promoted by House of Poddar Enterprise and Gillette Company, U.S.A. (Gillette). A company engaged in manufacturing shaving blades (7 O’clock, Ejtek shaving brush, Gillette Mach- 3, Mach 3 turbo).Just look at the details and you will understand

Details as on 21-Jan-2010

Share price- Rs.1,359.00;

Market Cap- Rs.4,464.50 cr;

52 Week- H- Rs.1,450.00; L- Rs.575.25;

P/E- 33.97; EPS- Rs.40.33;

Book value – Rs.150.65;

Dividend – Rs.12.50; Fv- Rs.10;

Total Debt- 0.00;

Reserves- Rs.458.30;

Total Share Issued- 3,25,85,217 shares;

Public Shareholding – 36,73,368 shares; Public Shareholding in %- 11.27%;

Promoter’s holding- 2,89,11,849 shares; Promoter’s holding in %- 88.74%;

Procter & Gamble India holds 41.02 % stake in Gillette India, even one of the most smart investor is into it. R.S. Damani holds 1.06 % in Gillette India. Gillette India,have its competitors like HUL,Dabur,Colgate,Godrej in personal care segment but non of these can compete Gillette in male personal care segment, (you can survey it by your self)

Gillette India is a best buy at Rs.1100- 1250, and should accumulate on further dips.

Pass on the legacy to your future generation. A DEBT FREE COMPANY at price of Rs.1100 is definitely a best buy. I bought at Rs.1080 on Diwali, Gillette India have given 1:1 bonus in 1989, A VERY STRONG CANDIDATE FOR THE BONUS ISSUE

I am not giving the price target as I believe this stock is meant for long term holding and not for short term gains. Yes it will not give you instant gains,it is a lazy kind of stock but with an extremely promising fundamentals.Daily vol is around 4169 shs from which 3321 shs -79.66 % is on delivery basis.

Container Corporation of India (CONCOR)

Total shares issued- 129982794 shs.

Promoter’s holdings- 81999802 shs- 63.08%

Promoters - President Of India-81998202 shs;

Other Promoters- 1600 shs,

Institutional holdings-22180162 shs-17.07%

52 Week-High-Rs.1275 on 23 Dec 2009;Low-Rs.594 on 23 Dec 2008.
Current Market Price - Rs.1257.20

Market Cap-16442.82cr; AS on 23/12/09

EPS-61.49;P/E-20.57; Ind P/E- 21.00

Book Value-289.44;Price/Book-4.37;Div %- 140

Total Share Capital- 129.98cr:

Net Worth- 3762.21cr; Total DEBT -0;

Incorporated in 1988, Container Corporation of India (CONCOR) is a multi-modal (rail and road) logistics support provider for the country’s exim and domestic trade and commerce, working under the ministry of railways, Government of India. It handles the imports and exports of the country from about 40 dry ports or terminals spread across India. It also enjoys a near monopoly situation in the transportation of Containerised cargo through the Indian railways. CONCOR`s core business is characterised by three distinct activities, that of a carrier, a terminal operator, and a warehouse operator. The key value the company offers is the provision of a single-window facility co-ordinating with all the different agencies and services involved in the containerised cargo trade right from customs, gateway ports, and railways, to road haulers, consolidators, forwarders, custom house agents and shipping lines CONCOR currently provides the only means by which shippers may obtain containerized freight transportation by rail in India. Though rail is the mainstay of its transportation plan, road services are also provided according to market demand and operational exigencies. CONCOR also operates container terminals across the country to cater to the needs of the trade, whether in the export-import or the domestic business.

Financials: - Container Corporation of India registered results for the quarter ended on 30-SEP-2009 as:

Net Sales- Rs. 959.9027 cr v/s Rs. 903.3608 cr on 30-SEP-2008.

Net Profit- Rs. 204.3475 cr v/s Rs. 223.6809 cr on 30-SEP-2008.

Conl- This stock has always being out of the analysts radar,also this stock has being giving a consitant performance over a period of time. Here I have tried to point out the underdog PSU, as the world expects to get out from recession & their EXIM trades to shoot up, INDIA is surely getting a pie from it & this is the company with an 21.03% of RoNW, and with the net profit of 204 cr on sales of 959cr is certainly shine in this space.

Read my Mundra port post for futher view on business.

SUZLON ENERGY

TOTAL SHARES ISSUED – 1556723743 shs.

GROSS DEBT – Rs. 13477 cr.

NET DEBT – Rs. 12525 cr. (As on SEP 09).

CASH HOLDINGS – Rs. 952 cr.

REPOWER SYSTEMS AG - RPW:GR

Total Shares Issued – 9177039 shs.

Suzlon holds – 8325409 shs - 90.72%.

Free Float – 851630 shs - 9.28%.

CMP- 8th DEC 2009, 114 Euros. 1Euro/Rs. 68.95

MKT CAP – 1046.18 million Euros, Rs. 7213.42 cr.

Free Float MKT CAP – 97.08582 million Euros, Rs.669.406 cr.

EPS – 0.16, PE – 711.13, P/B – 3.11, NP – 1479000 Euros, Rs.10.2073 cr.

Suzlon's stakes in REpower valued at Rs.6544.021 cr

HANSEN TRANSMISSION INTERNATIONAL NV - HSN:LN

Total Shares Issued – 670104208 shs.

After the 35.01% stake sale in November 2009.

Suzlon now holds – 174632079 shs a 26.06%. V/S 410632079 shs 61.28%.

CMP as on 8th DEC 2009 1.13 GBp. 1GBP/ Rs.76.04

MKT CAP – 757.21 million Pounds, Rs. 5757.88 cr.

EPS – 1.98p, PE – 53.41, P/B – 1.39, NP – 1319131000 GBp – Rs.101.1546 cr

Suzlon's stakes in Hansen valued at Rs. 1500.52 cr.

NOW,

REpower contributes to Rs.42.03 to Suzlon´s CMP of Rs.85 a nearly 49.45% of Suzlon.

HANSEN contributes to Rs. 9.63 to Suzlon´s CMP of Rs. 85 a nearly 11.34% of Suzlon. So Suzlon valued at Rs.33.34.

Suzlon´s enterprise value is around Rs 33801.69 cr (217/Sh).

Networth around Rs 6580.32 cr.

IF SUZLON ENERGY MANAGES TO RETIRE ITS Rs. 13000 cr DEBTS IT’S VALUE CAN GO…. I SAY CAN GO TILL Rs.180. BUT SINCE IT’S A HIGH BETA STOCK ALWAYS TRADE WITH STRICK STOPLOSS.