SPECIAL REPORT CENTURY TEXTILE & INDUSTRIES LTD
SPECIAL REPORT CENTURY TEXTILE & INDUSTRIES LTD
Century Textiles & Industries Limited - Company Profile
Incorporated in 1897, Century Textiles & Industries Limited manufactures cotton textile products and has presence in the yarn, denim, caustic soda, sulphuric acid, salt, cement, and pulp and paper industries.
Century Textiles & Industries Limited 100 % cotton yarn unit and its denim unit are both situated in Madhya Pradesh. The cotton yarn unit has a capacity of 24,960 spindles and the denim unit produces 21 million metres of denim fabric per year.
Century Textiles & Industries Limited cement segment manufactures and markets cement and clinker products for use in water tanks, roads, bridges, dams, sea walls, turbine blocks, and residential or multi-storeyed buildings under the Birla Gold brand. Century Textiles & Industries Ltd has three cement plants at different locations, with a total cement manufacturing capacity of 7.8 million tonnes per annum.
Century’s pulp and paper plant has a capacity of 31,320 tonnes per annum, writing and printing paper capacity of 1,97,800 tonnes per annum and a capacity of 36,000 tonnes per annum for tissue paper. The Company has set up a 500- tonnes per day multilayer packaging board plant adjacent to its existing pulp and paper plant at Lalkua, Uttarakhand.
Century Textiles & Industries Limited - STOCK INFORMATION
|
STOCK PRICE |
573.25 |
|
TARGET PRICE |
590-605 |
|
SECTOR |
CEMENT&CEMENT PRODUCT |
|
SYMBOL (AT NSE) |
CENTURYTEX |
|
ISIN |
INE055A01016 |
|
FACE VALUE (IN RS.) |
10.00 |
|
BSE CODE |
500040 |
Century Textiles & Industries Limited - STOCK FUNDAMENTALS
|
MARKET CAP |
5,318.03 |
|
BOOK VALUE |
187.80 |
|
EPS - (TTM) (IN RS. CR.) |
6.87 |
|
P/E |
83.20 |
|
INDUSTRY P/E SHAREHOLDING PATTERN |
16.65 |
INVESTMENT RATIONALE
CENTURY TEXTILE has 40 acres of mill land in Worli, one of Mumbai’s most attractive real estate micro-markets. Recent transactions/PE deals in Central Mumbai have materialized at a valuation of INR1.6b-1.8b/acre. Going ahead, we believe cost savings from upcoming CPP (would meet 80% requirement) and new cement plants with better operating efficiency will enhance operating margins, though it will be difficult to completely bridge the gap with peers. We expect 19% CAGR in cement EBITDA/ton over FY14-15 to INR734.
SHAREHOLDING PATTERN
OUTLOOK AND VALUATION
While the cement business is poised for steady improvement, acute margin pressure in non-cement segments, high leverage (FY15E net debt-equity of 4.9x) and delay in real estate value unlocking would limit upside potential. CENT trades at 11.1x FY15E EBITDA. For the cement business, this implies FY15E EV of USD72/ton v/s USD64/ton for MOSL Mid Cap Cement Universe and USD111/ton for overall Cement Universe. Our SOTP-based valuation is INR460/share: (1) cement (USD75/ ton), (2) paper (1x FY15E sales), (3) textiles (0.4x FY15E sales), and (4) land (FY15E NAV). We initiate coverage with a buy rating; our target price 605 levels.
RESULTS (Quarterly )(Rs CR.)
|
|
SEP' 14 |
JUN' 14 |
MAR' 14 |
DEC' 13 |
SEP' 13 |
|
Sales |
1,705.83 |
1,887.37 |
1,849.07 |
1,639.33 |
1,586.69 |
|
Operat- ing profit |
155.67 |
204.94 |
183.47 |
168.05 |
148.58 |
|
Interest |
109.26 |
96.26 |
93.70 |
90.47 |
91.13 |
|
Gross profit |
57.27 |
116.14 |
97.66 |
84.21 |
66.43 |
|
EPS (Rs) |
0.08 |
7.15 |
-0.53 |
0.17 |
-3.40 |
TECHNICAL VIEW
CENTURY TEXTILE LTD is looking strong on charts. We advise to buy around 565-575 with stoploss of 545 for the targets of 590- 605 levels. RSI is also showing upside momentum in it on daily charts.
|
SYMBOL |
VALUE |
ACTION |
|
RSI(14) |
66.062 |
BUY |
|
STOCH(9,6) |
66.352 |
BUY |
|
STOCHRSI(14) |
100.000 |
OVERBOUGHT |
|
MACD(12,26) |
-16.880 |
SELL |
|
ADX(14) |
24.967 |
BUY |
|
WILLIAMS %R |
-3.646 |
OVERBOUGHT |
|
CCI(14) |
182.9524 |
BUY |
|
ATR(14) |
18.5250 |
LESS VOLATILITY |
|
HIGH/LOWS(14) |
29.9071 |
BUY |
|
ULTIMATE OSCILLATOR |
61.636 |
BUY |
|
ROC |
10.314 |
BUY |
|
BULL/BEAR POWER()13 |
46.3260 |
BUY |
|
BUY: 8 SELL:1 NEUTRAL: 2 |
SUMMARY : STRONG BUY |
|
Our Other Recommendation for Next Week
|
SCRIP |
ACTION |
CMP |
ENTRY |
SL |
TGT |
TIME FRAME |
|
INDIA CEMENT |
BUY |
102.45 |
101-103 |
98 |
105-109 |
ONE WEEK |
|
BHARAT FORGE |
BUY |
1023.30 |
1010-1025 |
980 |
1050-1080 |
ONE WEEK |
|
JAIN IRRIGATION |
BUY |
69.55 |
68-70 |
66 |
72-75 |
ONE WEEK |
|
SUNPHARMA |
BUY |
853.10 |
840-855 |
820 |
875-895 |
ONE WEEK |
|
ARVIND |
BUY |
274.50 |
272-275 |
268 |
279-284 |
ONE WEEK |
Performance of Previous Week
|
SCRIP |
LOT |
ACTION |
ENTRY |
SL |
TGT |
P&L |
REMARK |
CLOSE / LOW/ HIGH |
|
TCS |
125 |
BUY |
2525 |
2460 |
2580-2620 |
6875.00 |
FIRST TGT HIT |
2538.30 / 2590.00 |
|
HEXAWARE |
|
BUY |
210.30 |
205 |
214-218 |
16000.00 |
BOTH TGT HIT |
217.60 / 220.40 |
|
NMDC |
|
BUY |
135.30 |
134 |
144-148 |
0.00 |
NOT OPEN |
135.70 / 137.25 |
|
JUST DIAL |
|
BUY |
1471.85 |
1430 |
1490-1520 |
7500.00 |
BOTH TGT HIT |
1547.60 / 1593.90 |
|
INTELLECT |
|
BUY |
115.70 |
104 |
120-125 |
10000.00 |
BOTH TGT HIT |
126.95 / 134.40 |
|
WOCKPHARMA |
|
BUY |
1080.25 |
1058 |
1090-1100 |
10000.00 |
BOTH TGT HIT |
1036.60 / 1118.00 |
|
NET PROFIT |
|
|
|
|
|
50375.00 |
|
|