Welspun Gujrat
Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Stock Synopsis
Forum Discription: A bried discussion of companies on very specific matters. Normally this is the prelude for further research as always members would be discussing quality companies with good management only
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=1010
Printed Date: 06/Apr/2025 at 3:08am
Topic: Welspun Gujrat
Posted By: Akila
Subject: Welspun Gujrat
Date Posted: 21/Jun/2007 at 6:02pm
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Hi,
I have the above share which I bought @ 150 level , now its creating new high's everyday..The order book of the company is very healthy ...
Any specific suggestions for me on this stock ...Anybody have analyzed the future of this one ?..
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Replies:
Posted By: kulman
Date Posted: 21/Jun/2007 at 8:00pm
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It is into a very interesting & promising space. It has been a 7~8 bagger already for a person known to me during last 2 years & he's still holding onto it. Welspun's competitors are PSL, Man Inds, Ratnamani, Jindal Saw, Mah Seamless.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: Rinku
Date Posted: 22/Jun/2007 at 7:31pm
| kulman ji I am holding for 2 years and its hardly 2 bagger I think? |
Posted By: PKB2000
Date Posted: 22/Jun/2007 at 10:02pm
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Rinkuji
I get the following information about the trading price of WELGUJ from one of my friend. And if we look at them then KULMANJI is more or less correct.
But there was a big jump of WELGUJ from 60 to a level of 100 within very short period of time say about 3 months and if you have the same after August 2005 then you may find it as a two baggers
It is like this Date of Trading Cost 19 November 2004 40.25 03-Mar-2005 42.40 ------------- I am always doing that which I cannot do, in order that I may learn how to do it. ~Pablo Picasso |
Posted By: kulman
Date Posted: 23/Jun/2007 at 1:47pm
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Let me check with him again, maybe he got in prior to '05. He's into contracting business & is in touch with Gail etc who are large buyers of such pipes.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 25/Jun/2007 at 8:07am
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 02/Jul/2007 at 9:52pm
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Akila.......the stock is buzzing.
They have started some mfg facility in USA.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: CHINKI
Date Posted: 02/Jul/2007 at 9:54pm
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Welspun-Gujarat to build manufacturing unit in US Add to Clippings
MUMBAI: Metal pipe manufacturer Welspun-Gujarat Stahl Rohren is planning to build a $100 million manufacturing facility at Arkansas in US and expects to start production by Spring of 2008. The Arkansas facility, once completed, would be capable of 300,000 net tonnes of tubular steel pipes annually for use in the oil and gas industry and Welspun Gujarat would hire about 300 workers, the company said in a communique to the Bombay Stock Exchange. The facility would be adjacent to the Little Rock Port authority. "We are happy to be here at Little Rock today which has the advantage of a talented workforce, the right transportation opportunities and above all, the right geographical location. We look forward to a long and prosperous future as partners in Little Rock," Welspun-Gujarat Vice Chairman and Managing Director B K Goenka said. With majority of its production exported to the United States, Welspun has a very strong presence in the US. It also supplies pipe foils to one of the world's deepest pipeline for the 'Independence Trail' project in the Gulf of Mexico. "Welspun could have chosen many other locations for their investments, and they chose Arkansas. Our workforce, infrastructure and the natural benefits of the Arkansas River convinced Welspun to become our partners in progress," Arkansas Governor Mike Beebe said. The company also has manufacturing facilities in Dahej and Anjar in Gujarat, India. Source : ET ------------- TOUGH TIMES NEVER LAST, BUT TOUGH PEOPLE DO |
Posted By: kulman
Date Posted: 31/Jul/2007 at 7:22pm
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This is from Welspun's competitor, Jindal Saw:
Jindal Saw Ltd has announced http://www.bseindia.com/qresann/news.asp?newsid=%7b6F784E73-D512-437C-A301-A995F986D922%7d - that following Outlook:
The developed world's increasing requirements for energy, and the emergence of the industrial powerhouses in developing countries, is the major catalyst of the growth in the OCTG and line-pipe markets. The boom in Oil and Gas exploration and production over the last few years has lead to a surge in demand for tubular products. The expectation of a long-term bull market in Oil and Gas prices has resulted in an extended upturn in demand for tubular products as exploration expenditure grows and the search for Oil and Gas pushes against new geological and technical boundaries. The rapid economic growth in India faces an urgent need to develop and improve water supply and sewerage systems, more prominently in urban areas. Demand for ductile iron pipes, which is main product of pipeline for water supply, is increasing rapidly and Government budget for development of water supply systems is also increasing. Accordingly, the Company expect a significant growth in the Ductile Iron Pipe demand. The Company has experienced a steady growth in all the business segments and expects to have improved performance in all the segments including large diameter Saw Pipes, Ductile Iron Pipes and Seamless tubes. The Company projects better and sustainable productivity and profitability supported by its sustained healthy order book. ------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: deveshkayal
Date Posted: 06/Dec/2007 at 5:43pm
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Deserves more coverage on TED and I will make sure it does !! ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: deveshkayal
Date Posted: 06/Dec/2007 at 9:10am
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Ranked amongst ‘India’s top 100 Corporates 2007’ by S&P.
Fastest Growing Co by Business Today, India.
Approved by more than 45 Oil & Gas Giants across the globe.
Sales realization grown by 28% YOY & 4.4% QTQ while RM cost grown by 17%YOY & 3% QTQ. So raw material costs did not affect Welspun Gujarat's financials.
Sales almost doubled, EBITDA 2.30 times & PAT more than tripled in the last 6 quarters.
Diluted EPS growth 127% in H1FY08
Operating margin 16.73% . Debt/Equity ratio: 0.95
Thrust on high realisation niche export market. Exports constituted 85% of total sales. Efforts have been to be present in all potential markets but selective for booking order in high realisation markets.
Raw Material Tied up - required for rest of the period. Majority of the shipping finalised.
Domestic market potential of over $5bn.
New projects – pipelines covering hook and nook of US, multiple project announced, long term sustainable demand.
Market opportunity of over $ 7 bn.
WELSPUN WOULD BE 1.75 MTPA BY MARCH 2009, MAKING IT ONE OF THE TOP 3 PIPE COMPANY IN THE WORLD.
Leading private equity player 3i Group bought 6.6% stake for $80mn saying it has one of the best management.
One of the 20 companies to watch out for in 2008 by Business Today.
Its order book, currently at Rs 5,500 crore, could vault to Rs 10,000 crore in 2008-09.
With domestic oil and gas product rising courtesy Reliance, we expect our India revenues to double to 30 per cent of sales next year,” says Goenka.
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I am thinking of taking some exposure to this stock. Everything is just great. 4 bagger in 3 years. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: deveshkayal
Date Posted: 07/Dec/2007 at 6:35pm
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Generally, What is the P/E given to Pipe manufacturers ???
Since, we have a growth visibility here and growing at over 50% CAGR, dont you think they merit a PE of 20... ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: smartcat
Date Posted: 07/Dec/2007 at 6:50pm
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Actually, P/Es for pipe manufacturers vary a lot.
Welspun Guj: 31
PSL: 30
Maharashtra Seam: 18
Jindal Saw: 14
Ratnamani: 12
Man Ind: 11
I guess the P/E valuation of a company that Mr. Market assigns depends on size, profit margins, product mix etc. If the demand sustains for a few more years, we could see higher average P/Es
But remember that steel companies trade at a P/E of 10 - 12. Since pipeline companies go higher up the value chain that commodity plays like steel, a P/E of 18 - 20 does not seem to be out of sync.
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Posted By: jack
Date Posted: 07/Dec/2007 at 7:45pm
| Ratnamani seems to be the good bet, but the stock has run up recently. |
Posted By: kulman
Date Posted: 07/Dec/2007 at 8:38pm
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Here's an excerpt from Biz Today article...
Welspun Gujarat Stahl Rohren
It’s already among the top three (oil and gas) pipe manufacturers in the world and has 60 oil companies as its clients.
Over the last three years, its profits have clocked a near or more than 100 per cent growth— Revenues too, have spiralled by 158 per cent over the 2004-05 levels to touch Rs 2,678.5 crore in 2006-07.
The company, which derives 85 per cent of its revenues from exports, will be commissioning its coilcum-plate plant at Kandla in Gujarat early next year, followed by the soft launch of its $100-million plant in Little Rock, Arkansas, in February.
Its order book, currently at Rs 5,500 crore, could vault to Rs 10,000 crore in 2008-09. “With domestic oil and gas product rising courtesy Reliance, we expect our India revenues to double to 30 per cent of sales next year,” says Goenka. Source: http://businesstoday.digitaltoday.in/profiting-from-pain-points-41.html - http://businesstoday.digitaltoday.in/profiting-from-pain-points-41.html For the Pipelines sector, there's a http://www.theequitydesk.com/forum/forum_posts.asp?TID=1386&PN=1 - separate thread on TED here.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: smartcat
Date Posted: 07/Dec/2007 at 9:59pm
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If you look at Ratnamani's 3 year graph, it looks like the stock has almost never had a down day - very steady upmove. So inspite of low P/E, the high earnings growth has resulted in above-market returns. Of course, if there is the much-loved P/E re-rating in stocks like these, the stock price will triple suddenly. Even if there is no re-rating, the stock price would follow the earnings growth.
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Posted By: deveshkayal
Date Posted: 08/Dec/2007 at 12:44pm
Even if market gives a one year forward PE of 15, PL estimates an FY10 EPS of 75, in 18 months we have a price target of 1125, CMP is 430 
Today's TOI reports that Welspun Group with Adani Group will bid for UK oil & gas company Burren Energy. Even if it misses Burren Energy, Goenka has no plans to give up on the business. He has put a blueprint in place to acquire oil blocks, both within the country and abroad, along with Adani.
Plz start a seperate thread on Ratnamani. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: smartcat
Date Posted: 08/Dec/2007 at 1:42pm
| Adani and Welspun together have bagged 2 blocks under NELP in Assam and Gujarat, and 1 block in Thailand for exploration. But I'm not sure if this comes under Welspun Gujarat. |
Posted By: kulman
Date Posted: 08/Dec/2007 at 2:03pm
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I guess that Oil & Gas exploration foray is not under WelGuj RalStr.
Besides, Devesh please keep in mind RoE. There could be equity dilutions, additional debt going ahead.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: deveshkayal
Date Posted: 08/Dec/2007 at 2:47pm
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CLSA reports states that "Investments at low capital costs and increasing utilisations will boost ROE to 40% till FY10. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: deveshkayal
Date Posted: 08/Dec/2007 at 8:05pm
Motilal has given a FY09 PE of 15 in its 22nd Oct report on Pipe manufacturers. ROE at 32%  ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: deveshkayal
Date Posted: 11/Dec/2007 at 4:08pm
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Edelweiss FY09 Diluted EPS is 28.8, FY08 EPS : 17.7
Btw, the stock was up 8% today at 475. I included it in my model portfolio at 400 !
HDFC Sec has a price target of 500. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: Akila
Date Posted: 11/Dec/2007 at 11:42am
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Iam holding this particular stock for past one year , it has grown from Rs.150 to Rs.475 now...
This is what the TV analyst has to say on Welspun Gujrat today..
http://money.rediff.com/money/jsp/company.jsp?companyCode=15580090 - Welspun Gujarat looks bulliosh on the charts, says Sachin Chavhan, techncial analyst, on CNBC Awaaz. The stock has a short term target of Rs 530, he adds.
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Posted By: deveshkayal
Date Posted: 12/Dec/2007 at 8:59am
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Emkay has put a one year price target of 608. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: kg
Date Posted: 28/Dec/2007 at 11:42pm
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Any updates available on this news ? CNBC-TV18 has learnt through sources that http://www.moneycontrol.com/india/stockpricequote/steel-tubespipes/welspun-gujarat-stahl-roh/13/10/WGS - Welspun Gujarat is close to an overseas acquisition.
2007-12-17 13:04:19 Source : CNBC-TV18
According to CNBC-TV18 analyst http://www.moneycontrol.com/mccode/news/searchresult.php?search_str=Nimesh%20Shah&datesel=2 - Nimesh Shah , after http://www.moneycontrol.com/india/news/business/welspun-gujarat-close-to-overseas-acquisition:-sources/317578# - According
to Shah, sources reveal that majority of this funding will be done by
the FCCB proceeds which the company had recently raised. Welspun
Gujarat has raised close to USD 725 million by FCCB issue. So most of
the money has been taken care of. Shah has also learnt from his http://www.moneycontrol.com/india/news/business/welspun-gujarat-close-to-overseas-acquisition:-sources/317578# - Commenting
on this news, the company's management has said they keep on exploring
various opportunities, but they cannot comment on any specific deals
and on market speculation. So
no official word from the management has come in, but the company is
pretty close to an overseas acquisition, Nimesh Shah said. He
thinks that Welspun Gujarat is close to bagging some big orders in the
international market. In fact, it has put in a bid for close to USD 2
billion of orders in the international market, of which they are
expecting close to 40% of the orders over the next couple of months, he
said. Shah estimates that to execute these orders, the company will need a company possibly having a capacity of that kind; which can probably help them in pursuing those orders - the new additional capacity in the domestic business will come up only by 2009. They are getting large orders especially from US and Canada, which is the big market for pipes etc, Shah added. ------------- Lets rock |
Posted By: deveshkayal
Date Posted: 16/Jan/2008 at 8:47am
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PAT up 136% YoY
EPS up 109% YoY
At 500, its trading at a FY09 PE of 15. At the most it can trade at a PE of 18-19 bcoz of being in a cyclical business. EPS should surprise for a re-rating. I have assumed 80% growth. Management is targetting 100% growth. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: deveshkayal
Date Posted: 18/Jan/2008 at 1:06pm
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HDFC http://www.moneycontrol.com/india/news/recommendations/buy-welspun-gujarat-targetrs-771-hdfc-sec/13/29/321954# - has recommended buy rating on http://www.moneycontrol.com/india/stockpricequote/steel-tubespipes/welspun-gujarat-stahl-roh/12/40/WGS - Welspun Gujarat Stahl Rohren , WGSRL in its January 17, 2008 reports. "WGSRL has once more performed much above our expectations, mainly on account of fantastic margin expansion. We believe that the company will witness significant growth in the years to come. It has planned a capex in step with the growing demand. Tighter focus on costs and steady growth in volumes will be the focus of the company. A change in product mix is expected to drive sustained profitability that will improve further in the future. The revenues and profits of WGSRL are expected to grow at a CAGR of 41.62% and 89.45% between FY07-10E. The http://www.moneycontrol.com/india/news/recommendations/buy-welspun-gujarat-targetrs-771-hdfc-sec/13/29/321954# - currently trades at a huge discount to its fair value on a DCF basis. We expect it to re-rate positively and when coupled with the underlying earnings growth, deliver significant out performance to http://www.moneycontrol.com/india/news/recommendations/buy-welspun-gujarat-targetrs-771-hdfc-sec/13/29/321954# - in the long term. We therefore maintain our Strong BUY recommendation on the stock with a target price of Rs 771 (upside of 54%), ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: nitin_jagtap
Date Posted: 18/Jan/2008 at 1:25pm
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I also remember that Sanju verma of HDFC Sec had given this as a potential multi bagger pick for diwali. ------------- Warm REgards Nitin Jagtap |
Posted By: deveshkayal
Date Posted: 11/Feb/2008 at 2:24pm
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B K Goenka to BS
What is the macro scenario?
There is a robust investment plan for pipelines globally and strong replacement demand in the US, Canada and Europe. Approximately $88 billion investment in the pipeline infrastructure is planned for the next five to seven years. Also, about one million miles of pipelines are due for replacement alone over the next two to three decades, which translates into an opportunity of $ 400 billion.
Further, there is going to be strong demand for pipes in India given the plans of Reliance, GAIL and Gujarat State Petroleum Corporation.
Are you geared to meet this demand?
By March 2009, we would have increased the capacities of LSAW from 3.5 lakh tonnes to 6.5 lakh tonnes and HSAW from 4 lakh tonnes to 8.5 lakh with an investment of $200 million. Our plate cum coil mill plant of 1.5 million capacity, one of the largest in the world, will be fully commissioned by March 2008.
It will not just financially, but also, operationally make us strong and among the top three pipe companies in the world. Thus, not only volumes will be robust, but margins will also improve. However, this will happen only in FY10, which is the first full year of operations.
What will be the share of exports?
Exports contribute about 90 per cent of our current order book of Rs 4,500 crore while the rest by the domestic market. US and Canada has a major share of 50 per cent and 30 per cent respectively in our exports, with the rest contributed by Latin America, Middle East and other regions. Contribution of exports is likely to decline to 80 per cent.
Is the company’s high growth sustainable?
Our net sales have grown at a CAGR of 60.85 per cent between FY03-07 while our net profit has grown manifold from around Rs 2 crore to Rs 143 crore in the same period. We achieved the highest ever realisation of $ 1600 in the December 2007 quarter.
Thus, going ahead, we expect to maintain the current pace of growth in sales and profitability. We expect realisation to be maintained followed by a robust volume growth of 30-40 per cent. More importantly we should see a larger bottom line growth on account of plate mill expansion.
How has the company coped with the rising rupee?
We have a natural hedge against rising rupee as imports of raw material form about 70 per cent of total raw material costs. Also, most of contracts have a back-to-back arrangement for foreign exchange-just like we have for raw material. Moreover, our Japanese and European competitors have also faced the similar situation of appreciating currency. Finally, our customers are not price sensitive as they are more focussed on quality.
What will be the impact of slowing US economy and softening of oil prices?
There is a strong replacement demand and the company's oil producing customers are cash rich (with positive large cash flows due to a high oil price for so long) to spend on the pipeline infrastructure. Softening of oil prices does not affect the company immediately, as there is a time lag of about three years in slowing down of exploration activities and investment in pipeline infrastructure. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: kulman
Date Posted: 20/Feb/2008 at 1:21pm
http://www.bseindia.com/qresann/news.asp?newsid=%7b9A7CBCCB-BDBF-4E01-86BB-055653AF9A21%7d - Welspun-Gujarat Stahl - Rs 120 Crores order, takes Order-book to Rs 4,700 Crores
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: deveshkayal
Date Posted: 20/Feb/2008 at 9:15pm
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WGSL is one of those companies whose earnings are growing at 100% with a strong ROEs and ROCEs. That's that reason it has fallen just 10% from its highs ! ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: catcall
Date Posted: 24/Mar/2008 at 9:54pm
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Welspun-Gujarat Stahl Rohren Ltd has announced that the Company has bagged prestigious pipeline orders worth Rs 1075 Crores for the supply of Spiral Pipes in Northern Africa. The new order has taken Welspun’s order book position to above Rs 5900 Crores. This contract won against European competition reaffirms Welspun's positioning into high-end large diameter business. Commenting on the orders, Mr. B K Goenka - Vice Chairman and Managing Director of the Welspun Group said, "Welspun's strong demonstration of 'Engineering Excellence' and accreditations from top Oil and Gas Companies across the World results in new orders and reinstates our position as one of the largest and premium line pipe Company in the World". Company re iterates its conservative policy of booking raw material, freight, foreign currency well in time. ------------- There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing! |
Posted By: deveshkayal
Date Posted: 01/Apr/2008 at 7:49pm
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From Credit Suisse report
Playing differently ■ Event: We initiate coverage with an OUTPERFORM rating and a target price of Rs415. ■ View: In the current environment of strong global demand for line pipes, we believe Welspun is the best placed among Indian manufacturers, with 45 customer approvals, a strong track record of execution, and the highest EBITDA margins. 70-75% of its order book has no competition from other Indian players. Welspun’s pipe production is expected to grow 80% over the next two years. EBITDA margins are also expected to expand by 300 bp starting in FY09 due to backward integration (commissioning of a plate mill in April 2008). Plate sales will also commence as the plate capacity is needed internally. Together these should lead to a 65% EBITDA CAGR over the next two years. There is a risk of possible oversupply in plates globally, which could hurt plate and then LSAW pipe prices, but we are not concerned, as planned capacity growth globally has historically lagged targets. ■ Catalyst: Plate mill commissioning in April 2008 adds 300 bp to the margin. Further order announcements (beyond the 12-15 months on the current order book of US$1.5 bn) are likely to generate excitement around the stock. We build in a 30% increase in the order book in FY10. ■ Valuation: Welspun trades at the highest multiple among its Indian counterparts. The stock was rerated from 6x to 8x EV/EBITDA in 1Q08 when it delivered a 400 bp margin improvement and also announced plans to set up its US HSAW facility. Our target price of Rs415 is derived using 7.5x FY09E EV/EBITDA (a 25% premium to the global average) – conservative, as the company has revenue visibility for 12-15 months. If we were to value the stock on FY10E EBITDA, the value would be Rs630. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: kulman
Date Posted: 06/Apr/2008 at 10:59am
From http://economictimes.indiatimes.com/Features/Investors_Guide/In_piping_hot_form/articleshow/2931132.cms - ET today....very agressive projections!
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: catcall
Date Posted: 07/Apr/2008 at 10:00pm
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Had added Wel Gujarat @345 levels, even at these levels looks to be a gr8 buy ------------- There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing! |
Posted By: grim
Date Posted: 10/Apr/2008 at 7:30pm
With steel prices likely to go up ( eventualy) how does it change the forecast for Wel. Guj? (I am assuming they use steel as raw-material.) |
Posted By: deveshkayal
Date Posted: 10/Apr/2008 at 10:15am
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Raw material costs for pipe companies’ account for ~70% of revenues, exposing them to volatility in steel prices. Further, most of the contracts signed for oil/gas pipes are fixed price contracts without price escalation clauses, exacerbating the impact of volatile steel price on profitability of pipe companies. ------------- "You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett |
Posted By: kulman
Date Posted: 24/Apr/2008 at 8:19am
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: catcall
Date Posted: 28/Apr/2008 at 10:09pm
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Gr8 set of results.......
with the Company posting a PAT of Rs 1022 million for the quarter ended March 31, 2008 as compared to Rs 415 million for the quarter ended March 31, 2007 and a profit after tax of Rs 3514 million for the year ended March 31, 2008 as compared to Rs 1426 million for the year ended March 31, 2007  ------------- There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing! |
Posted By: India_Bull
Date Posted: 28/Apr/2008 at 5:19am
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This company is terrific, I have not been able to make up my mind on this one, yet it never disappointed me whenever I bought or sold it.
------------- India_Bull forever Bull ! www.kapilcomedynights.com |
Posted By: kulman
Date Posted: 29/Apr/2008 at 8:49pm
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FM announced 10% export duty on Steel Pipes. While it is negative news, fine print of the new regulation needs to be seen.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 09/May/2008 at 10:44pm
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 11/Jul/2008 at 3:03pm
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New orders of Rs 3000 Crores takes http://www.bseindia.com/xml-data/corpfiling/announcement/Welspun-Gujarat_Stahl_Rohren_Ltd_110708.pdf - order book to Rs 7700 Crore
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: rapidriser
Date Posted: 11/Jul/2008 at 4:27pm
I am a regular reader (and not so regular contributor to this forum). I have noticed a large number of posts and discussions about the order book positions of companies in the Capital Goods and Infrastructure sectors. These are usually followed by optimistic projections about the respective companies' future growth and profitability. While I am very sure that the experienced TEDies are aware of this, I would like to clarify for the benefit of the Newbies that a large order book is not necessarily a sign of prosperity, for the following reasons - 1. Orders may have been procured at very thin margins. In bad times, companies may even accept orders below their costs, simply to keep their plants and personnel gainfully employed. 2. Many orders are accepted at fixed rates. If there is an increase in raw material and energy costs after the orders are finalized, a profitable order can quickly turn into a loss making deal. This is especially relevant in the present inflationary period. 3. Clients can cancel or reduce their orders at a later date, if their own business plans don't go ahead as envisaged. There is not much the supplier can do in such cases. 4. Finally, the company may not be able to execute the orders in the planned time period leading to cost overruns and contract penalties. In conclusion, a large order position is only an indicator about the growth prospects of the company. For evaluating financial performance there is no substitute to the balance sheet. |
Posted By: paragdesai
Date Posted: 11/Jul/2008 at 4:40pm
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Rapidriserji,
What you say is correct but it also depends on the specialities of the company where company may have a expertise which other company may not have. So such company can have a pricing power despite over all slow down situation. I don't know about this company but L&T is a prime example of this.
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Posted By: catcall
Date Posted: 12/Jul/2008 at 11:19am
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The difference between companies like Welsspun Gujarat and your regular Cap Goods Companies is that the priceing mechancism in this industry is not as complicated as a normal CAP goods companies, where specially in Turnkey contracts, there are a lot of unknown variables, which may go wrong as the project progresses.
For these kinds of comanies, it is unlikly that the quoted prices go haywire. Also, unlike a Cap goods company, which would have a 2~3 year time frame between the quote and the completion of actual execution, for companies like Wel.Guj, the lead times are much less and therefore the chances of price escalatons are reduced to that extent ------------- There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing! |
Posted By: kulman
Date Posted: 13/Jul/2008 at 4:14pm
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Business Line today carries a brief write up http://www.thehindubusinessline.com/iw/2008/07/13/stories/2008071351390100.htm - Welspun Gujarat Stahl
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 21/Jul/2008 at 11:14pm
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NP took a hit due to export duty which has since been withdrawn. Outlook looks okay so far. http://www.bseindia.com/xml-data/corpfiling/announcement/Welspun_Gujarat_Stahl_Rohren_Ltd_210708.pdf - Click here for 1Q FY09 results ------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: bassein
Date Posted: 15/Sep/2008 at 11:02am
I'm being thrashed by their pipes  .
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Posted By: catcall
Date Posted: 16/Sep/2008 at 6:45pm
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Seems more to do with the outstanding Open position in the F&O segment and short hammering than anything else... I am not aware of any other reason for this fall... I would perceive the fall of the Rupee as a positve for all pipe exporters... ------------- There are two times in a man's life when he should not speculate-when he can't afford it and when he can-Happy investing! |
Posted By: bassein
Date Posted: 30/Sep/2008 at 8:25am
The same brokerage is still positive on Welspun Gujarat. If I get the details, I'll cut-n-paste them in this thread. Right now, this stock is contributing to my multi-beggar status. |
Posted By: abhishekbasu
Date Posted: 30/Sep/2008 at 10:35am
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I read somewhere that Welspun is planning to start a factory in the North East. Their logic is that the new oil and gas finds in the east will provide a huge boost to the pipes business in the east of India. Can someone throw some light on this news? Whether its correct or not? Also, they received the Best Emergin company award in this week's ET awards. |
Posted By: Hitesh Shah
Date Posted: 30/Oct/2008 at 9:30am
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They have reported Q2 results in today's Economic Times in a cryptic and almost angry way!?
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Posted By: Nilesh Mahajan
Date Posted: 31/Oct/2008 at 5:59pm
Welspun Guj Q2 net profit at Rs 65.31crhttp://indiaearnings.moneycontrol.com/sub_india/comp_results.php?sc_did=WGS - has declared its second quarter results. Its Q2 standalone net profit was at Rs 65.31 crore versus Rs 82.50 crore, YoY. Its operating profit was at Rs 156.9 crore versus Rs 153.3 crore. Its standalone net sales were at Rs 1,492.8 crore versus Rs 927.60 crore, YoY. Its other income was at Rs 3.9 crore versus Rs 2.2 crore. < ="http://202.87.40.52/promos/sponsor_news.js">Its forex loss was of Rs 88.4 crore. Its interest cost was at Rs 31.4 crore versus Rs 17.2 crore. |
Posted By: Nilesh Mahajan
Date Posted: 16/Jul/2009 at 7:46pm
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Very good results by welspun today. June profit nearly doubled on volume growth and a one-time gain on account of foreign exchange fluctuation. The company posted a net profit of 1.38 billion rupees in the April-June quarter on a 72 percent rise in net sales of 18.8 billion rupees. It earned 375.3 million on reversal of foreign exchange provision and coil sales.
STRONG ORDER BOOK Welspun has an order book of 68.4 billion rupees which is 1.17x its FY09 sales. |
Posted By: Nilesh Mahajan
Date Posted: 16/Jul/2009 at 7:48pm
Hitesh ji, It will be interesting to see how they report this time's results in media.   
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Posted By: neerajlulla
Date Posted: 17/Jul/2009 at 4:27pm
sell this stock ------------- buy and forget for long term |
Posted By: Nilesh Mahajan
Date Posted: 17/Jul/2009 at 4:38pm
Why what happened, Neeraj? |
Posted By: Nilesh Mahajan
Date Posted: 20/Jul/2009 at 10:59pm
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ICICIdirect.com has recommended a hold rating on Welspun Gujarat, with price target of Rs 218, in its report dated July 17, 2009. "Welspun Gujarat trades at EV/EBITDA of 5.7 times FY11E. The demand for the pipes will improve in the coming quarters given the recovery in crude oil prices. The Indian market also provides an opportunity where major projects are to be executed. We value the company at EV/EBITDA of 6 times FY11E with a price target of Rs 218, Hold," says ICICIdirect.com's report. |
Posted By: neerajlulla
Date Posted: 16/Aug/2009 at 5:56pm
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I HAVE LOST DUE TO ICICI "S AVICE INTO SOME OTHER COMPANY ------------- buy and forget for long term |
Posted By: Nilesh Mahajan
Date Posted: 16/Aug/2009 at 8:47pm
True, one should never believe the price targets given by brokerages. But one can get some inputs on revnue & profit growth estimates which can be considered with some error (which varies from 0% to 50%). I would be wary of overly high estimates. But looking at multiple analysts gives a fair idea abt the estimates. |
Posted By: shivkumar
Date Posted: 21/Oct/2009 at 1:22am
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how does welspun gujarat stahl rohn compare with Oil Country Tubular? The latter has far better ratios but is still quoting at single digit P/Es. Also how much will WGSR be affected if the US market goes into a major depression? would appreciate detailed write up by anyone tracking this sector. |
Posted By: CHINKI
Date Posted: 21/Oct/2009 at 9:11am
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I was just looking at Oil Country Tubular financial parameters and business potential Vs Welspun.
First of all you cannot compare these two companies. Welspun is pipe manufacturer (SAW & Other varieties) which is used in Oil Exploration, Sewage, water as well as gas transport. With GAIL planning for a huge network of pipes for gas (I think it is CNG) for the house consumption, the demand for pipes will go up. As per Macquire report, GAIL will be adding 5,500km of gas pipelines and building 6,000km of national gas highways over the next five years. Most of the exploratory blocks that have been offered under various rounds of New Exploration Licensing Policy (NELP) will enter the drilling phase over the next few years. NELP I and NELP II blocks entered the drilling phase in FY08 and FY09. NELP III to NELP VII will enter the drilling phase over FY10–14. This implies that demand for seamless pipes for oil & gas drilling will remain robust. As per the above mentioned report, Demand for SAW pipes comes from both new pipelines and the replacement of old pipelines. Most of the pipelines need replacement after being in operation for 25–35 years. Replacement of old pipelines that were laid during the 1960s and 1970s (mainly in the US and Russia) should generate substantial demand for welded pipes. It is expected pipelines of ~50,000km to be replaced in the next five years, which might turn out to be conservative as ~1.8m km out of a total 2.7m km of pipelines in the US are over 30 years old and will need replacement in the near future. Welspun is in a good position to take care of these demands. On the other hand, Oil country tubular makes only tool joints, casing pipes and other accessories which are required in oil drilling. So it does not make any pipes and they are entirely depend on Oil Exploration Industry like ONGC. While the did Rs.400+Crores business last year, their AR-09 says that they are forcasting only 350Cr. of turnover this year. Their Q2 results are out day before yesterday, they have already cross 200Cr turnover with Profits zooming 32%. ------------- TOUGH TIMES NEVER LAST, BUT TOUGH PEOPLE DO |
Posted By: subu76
Date Posted: 21/Oct/2009 at 9:17am
| Perhaps the US Govt action on Chinese pipe makers will also help Welspun |
Posted By: furkanalam
Date Posted: 22/Oct/2009 at 1:24pm
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How does Welspun compare with PSL and Man Industries??
Any idea anyone....
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Posted By: Nilesh Mahajan
Date Posted: 27/Oct/2009 at 3:40pm
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Awesome results in Q2. NP jumps by 114%. Current order book 1.7 times 2009 revenues. |
Posted By: venkat
Date Posted: 27/Oct/2009 at 3:55pm
What a scorching growth rate- doubling in profit every year for the last five years. ------------- Life is always a fight....to finish at the start line. Problem-Use challenge, Tension-Use excitement,Ican't-Use i can,avoid no at the beginning of sentence. |
Posted By: Nilesh Mahajan
Date Posted: 21/Jan/2010 at 6:46pm
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Q3 Results 268% growth in PAT 13% growth in topline! 9 months EPS is 21. I expect they will end with EPS of arond 28-30.
With that they r trading at less than 10 PE which is pretty low for a company of its size with around 600cr Net profit. Debt has reduced via funds raised by QIP in this qtr. Promising! |
Posted By: shivkumar
Date Posted: 21/Jan/2010 at 6:52pm
| The company's US operations could be a major drag on its finances despite the size of opportunity in that country - oil pipelines there need to be replaced on gigantic scale. However the debasement of the US dollar would be a big negative. One should thus bet on the scrip only on the basis of its Indian operations with the US business as a cherry on the cake. |
Posted By: Prasham
Date Posted: 08/Feb/2010 at 10:55pm
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Should I buy this stock at CMP? I have traded in this counter a few times when it was running between 100-200. Later on couldn't get hold of it as it just went too high.
When should one enter this stock? I can hold this stock for 2-3 years. What returns can I expect? ------------- |
Posted By: shivkumar
Date Posted: 08/Feb/2010 at 12:01pm
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The US operations seem to be a major drag on the company with markets pricing it at a discount. In case of more bad news from the US and particularly if the dollar depreciates, this stock could take a big hit. Stock is on my watchlist precisely for this reason. |
Posted By: Prasham
Date Posted: 09/Feb/2010 at 4:47pm
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I understand your concerns but aren't they hedging? Moreover what level are ideal for long term investment in this counter?
P. S. I am a newbie as my status shows. Please bear with me if you find the above questions "kiddish" ------------- |
Posted By: shivkumar
Date Posted: 09/Feb/2010 at 5:10pm
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when bad news comes from the US, this stock should get hammered down more than other pipe companies. however long term prospects seem to be good since much the pipe network in the US is due for replacement. however if the dollar falls in value, company's profitability could get hurt. This is what the market fears and we should use to full advantage. |
Posted By: Nilesh Mahajan
Date Posted: 26/Aug/2010 at 12:29pm
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Has anyone studied the possible effect of litigation on Welspun Corp's business? Here is some info I found on this one - http://www.rmdhar.com/index.php/2010/08/25/welspun-corp-potential-liability-for-defective-supply-hangs-heavy-stock-share-results/ - Welspun Litigation |
Posted By: srisaurabh2000
Date Posted: 14/Nov/2010 at 8:10pm
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Interesting read:
http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=498625 - http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=498625
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Posted By: bitu1978
Date Posted: 02/Dec/2010 at 11:38am
| This Has been Butchered Down almost 25 % |
Posted By: Nilesh Mahajan
Date Posted: 02/Dec/2010 at 11:48am
Sad development...  |
Posted By: srisaurabh2000
Date Posted: 03/Dec/2010 at 12:34pm
http://www.sebi.gov.in/cmorder/SanjayDangi.pdf - http://www.sebi.gov.in/cmorder/SanjayDangi.pdf
This also mentions these cos. where Dangi got pre-IPO or preferential allotment, not sure why the regulator wakes up late and is selective:
Arrow Textiles Limited, Brabourne Enterprises Limited, Delta Corp Limited, Micro Technologies (India) Limited, Resurgere Mines & Minerals India Limited
Also mentions Dangi playing in these stocks:
Parekh Aluminex Limited, Panasonic Home Appliances India Limited, J Kumar Infra Projects Limited, Prakash Steelage Limited and Core Projects & Technologies Limited
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Posted By: Ravenrage
Date Posted: 03/Dec/2010 at 9:27pm
| Incidentally HDFC Sec , had come out with a report on Pipe Industry with a buy call on Welspun Gujarat and a price target of 320 ! |
Posted By: sbkv
Date Posted: 04/Dec/2010 at 3:37pm
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How do we value the stock now? Should we sell out as Institutional holding is high there are chances for further selling by them leading to lower prices or should we be brave anad average at these prices? Book Value is close to 135 but does book value account for anything for a fraudulent management? The dilemma is greater cause the business looks good & is expanding fast with prospects of becoming No. 1 Pipe supplier in the world. Feedback will be appreciated |
Posted By: LearningToFly
Date Posted: 04/Dec/2010 at 9:13pm
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This is the problem with our market. The enforcement is just pathetic and because of this laxity, the common investors suffer.
Not to pre-judge but I am sure some disgruntled guy who did not get his share of the pie informed SEBI. Most of the big folks have nothing to lose but common investors will be poorer. ------------- Success... at all cost. |
Posted By: bihisello
Date Posted: 04/Dec/2010 at 11:01pm
| One thing India is very good at is giving bail to criminals promptly. |
Posted By: bobdylan
Date Posted: 31/Aug/2011 at 7:41pm
| Welspun Gujarats pipe business seems to be having good potential,but wondering if it is worthwhile to hold on to this due to corporate governance issues,i was wondering why a PE fund would invest into it knowing the pitfall,would things improve if they are invested in it. |
Posted By: FutureBull
Date Posted: 31/Aug/2011 at 9:28pm
You are broadly right.. PEs will definitely demand higher standards but those guys would have bargaining power and lot more info about the business but not the case with you. I would repeat well known saying "when in doubt stay out" even if you are making losses. Invest somewhere else and sleep well
------------- ‘The market always does what it’s supposed to — BUT NEVER WHEN’. |