Sundram Fasteners Ltd.

Current price

174.70

Sector

Fasteners

No of shares

210128370

52 week high

219.00

52 week low

50.70

BSE Sensex

28469.67

Nifty

8634.65

Average Volume

45204

BSE Code

500403

NSE Symbol

SUNDRMFAST

Company Overview

Sundram Fasteners Limited is a part of the US $5 billion TVS Group, headquartered in Chennai, India. Sundram Fasteners Ltd has established a track record of leadership over 40 years. With a diversified product line, world-class facilities in 4 countries and motivated team of talented people, Sundram Fasteners has become a supplier of choice to leading customers in the automotive and industrial segments worldwide..

The product range consists of high-tensile fasteners, powder metal components, cold extruded parts, hot forged components, radiator caps, automotive pumps, gear shifters, gears and couplings, hubs and shafts, tappets and iron powder. Over the years, the Company has acquired cutting-edge technological competencies in forging, metal forming, close-tolerance machining, heat treatment, surface finishing and assembly.

Manufacturing locations are supported by engineering and design personnel working on new product design and development. It has operations in India, China, the United Kingdom, Malaysia, Germany, and the United States. Understanding the global nature of business and the need to provide quality products on “just in time” basis to customers, the company has established supply chain logistics networks spanning several continents.

The current market capitalisation stands at Rs 3,721.37 crore. The company has reported a standalone sales of Rs 575.46 crore and a Net Profit of Rs 30.13 crore for the quarter ended Dec 2014.

Share Holding Pattern

Category

No. of Shares

Percentage

Promoters

104,085,280

49.53

General Public

55,802,805

26.56

NBFC and Mutual Funds

26,830,121

12.77

Financial Institutions

12,683,968

6.04

Foreign Institutions

5,881,397

2.80

Other Companies

4,571,033

2.18

Others

273,766

0.13

Financial Details
  • Market Cap (Rs Cr) – 3689.25

  • Company P/E (x) – 25.22

  • Industry P/E (x) – 28.07

  • Book Value (Rs) – 38.16

  • Price / BV (x) – 4.60

  • Dividend (%) – 170%

  • EPS (TTM) – 6.99

  • Dividend Yield (%) – 0.97%

  • Face Value (Rs) – 1

Industry Overview

Fasteners form a vital part of any structure as they help in joining two or more components together. Economic development in India has led to a rise in disposable income of consumers which in turn has resulted in growing demand for automobiles. This factor is expected to be one of the primary reasons driving the growth of the market. In addition, rise in construction and maintenance activities all across the world is expected to be an important factor which will boost the demand for fasteners over the forecast period. Development of fasteners which are customized for niche application segments such as railways and solar equipment is expected to open opportunities for the growth of the market within the forecast period.

Automobile industry accounts for 75 per cent of the total demand of this industry followed by consumer durables and railways. With the automotive industry witnessing a significant growth rate along with increasing global demand, the future of the Indian fastener industry is very promising. Other OEM segments such as electronic and electrical, fabricated metal products and aerospace equipments were the largest application segments of fasteners and accounted for over 30% of the demand in 2011.

However, demand for fasteners is expected to be highest from construction on account of the rising construction and maintenance activities worldwide. The construction application segment is expected to grow at a CAGR of over 9% from 2012 to 2018. Automotive OEM sector is expected to show above average growth within the forecast period.

Asia Pacific accounted for the highest demand for industrial fasteners in 2012 and is expected to account for over 45% of the market by 2018. The trend is expected to continue over the next six years due to factors such as rapid industrialization and favorable economic conditions, which is expected to boost the demand for durable goods and other manufacturing and development activities.

Balance Sheet

 

Mar '14

Mar '13

Mar '12

Mar '11

Mar '10

Sources Of Funds

 

 

 

 

 

Total Share Capital

21.01

21.01

21.01

21.01

21.01

Equity Share Capital

21.01

21.01

21.01

21.01

21.01

Reserves

754.63

673.28

612.45

533.94

459.14

Networth

775.64

694.29

633.46

554.95

480.15

Secured Loans

306.09

338.93

344.19

649.66

369.39

Unsecured Loans

291.90

370.28

351.68

99.95

198.52

Total Debt

597.99

709.21

695.87

749.61

567.91

Total Liabilities

1,373.63

1,403.50

1,329.33

1,304.56

1,048.06

Application Of Funds

 

 

 

 

 

Gross Block

1,380.03

1,231.79

1,133.13

1,010.96

910.89

Less: Accum. Depreciation

597.56

524.16

460.34

403.15

350.75

Net Block

782.47

707.63

672.79

607.81

560.14

Capital Work in Progress

20.53

21.41

40.09

50.04

19.64

Investments

123.16

132.02

142.63

142.37

142.39

Inventories

290.18

321.18

323.98

286.93

209.53

Sundry Debtors

405.77

432.92

433.52

364.55

260.37

Cash and Bank Balance

9.21

10.59

6.71

8.13

4.65

Total Current Assets

705.16

764.69

764.21

659.61

474.55

Loans and Advances

217.82

219.55

189.66

144.07

121.21

Fixed Deposits

0.00

0.00

0.00

0.46

0.38

Total CA, Loans & Advances

922.98

984.24

953.87

804.14

596.14

Current Liabilities

435.10

408.29

448.62

277.54

253.52

Provisions

40.40

33.52

31.42

22.25

16.73

Total CL & Provisions

475.50

441.81

480.04

299.79

270.25

Net Current Assets

447.48

542.43

473.83

504.35

325.89

Total Assets

1,373.64

1,403.49

1,329.34

1,304.57

1,048.06

Contingent Liabilities

69.60

102.38

63.04

26.00

80.96

Book Value (Rs)

36.91

33.04

30.15

26.41

22.85

Profit and Loss Account

 

Mar '14

Mar '13

Mar '12

Mar '11

Mar '10

Income

 

 

 

 

 

Sales Turnover

2,022.28

2,069.42

2,146.64

1,944.81

1,421.93

Excise Duty

0.00

0.00

0.00

136.42

88.07

Net Sales

2,022.28

2,069.42

2,146.64

1,808.39

1,333.86

Other Income

38.72

27.58

18.07

-1.26

15.43

Stock Adjustments

-6.63

-3.18

39.81

25.99

2.27

Total Income

2,054.37

2,093.82

2,204.52

1,833.12

1,351.56

Expenditure

 

 

 

 

 

Raw Materials

1,107.88

1,192.65

1,290.26

1,064.77

761.60

Power & Fuel Cost

111.45

119.16

90.37

86.95

62.29

Employee Cost

218.23

201.91

184.24

158.97

124.27

Other Manufacturing Expenses

0.00

0.00

0.00

168.16

113.61

Selling and Admin Expenses

0.00

0.00

0.00

72.07

91.56

Miscellaneous Expenses

321.97

295.19

326.48

59.54

14.99

Total Expenses

1,759.53

1,808.91

1,891.35

1,610.46

1,168.32

Operating Profit

256.12

257.33

295.10

223.92

167.81

PBDIT

294.84

284.91

313.17

222.66

183.24

Interest

58.58

81.35

92.20

23.90

27.91

PBDT

236.26

203.56

220.97

198.76

155.33

Depreciation

76.37

71.62

63.61

54.54

47.48

Profit Before Tax

159.89

131.94

157.36

144.22

107.85

PBT (Post Extra-ord Items)

159.89

131.94

157.36

144.47

107.43

Tax

39.00

36.88

44.75

39.07

32.42

Reported Net Profit

120.89

95.06

112.60

105.18

75.43

Total Value Addition

651.65

616.26

601.10

545.68

406.72

Equity Dividend

35.72

29.42

29.42

26.27

18.91

Corporate Dividend Tax

4.20

4.82

4.67

4.36

3.17

Per share data (annualised)

 

 

 

 

 

Shares in issue (lakhs)

2,101.28

2,101.28

2,101.28

2,101.28

2,101.28

Earning Per Share (Rs)

5.75

4.52

5.36

5.01

3.59

Equity Dividend (%)

170.00

140.00

140.00

125.00

90.00

Dividend and Bonus History

Index and Company Price Movement Comparison

Company Forecast

Technical Indicators

Symbol

Value

Action

RSI(14)

75.469

Overbought

STOCH(9,6)

76.941

Buy

STOCHRSI(14)

52.559

Neutral

MACD(12,26)

36.330

Buy

ADX(14)

80.079

Overbought

Williams %R

-22.825

Buy

CCI(14)

84.8056

Buy

ATR(14)

26.7893

High Volatility

Highs/Lows(14)

33.7929

Buy

Ultimate Oscillator

51.526

Buy

ROC

298.210

Buy

Bull/Bear Power(13)

80.7140

Buy

Important Ratios (YoY)
  • PBIT – 8.67 v/s 8.86

  • RoCE – 16.63 v/s 15.10

  • RoE – 15.1 v/s 13.2

  • Net Profit Margin – 5.83 v/s 4.53

  • Return on net worth – 15.58 v/s 13.69

  • D/E Ratio – 0.77 v/s 1.02

  • Interest Cover – 3.90 v/s 2.61

  • Current Ratio – 0.98 v/s 1.05

  • Reserves – 754.63 cr v/s 694.29 cr

  • PAT – 120.89 cr v/s 95.06 cr

  • Total assets – 1373.64 cr v/s 1403.49 cr

  • Net sales – 2022.28 cr v/s 2069.42 cr

  • Book Value – 36.91 v/s 33.04

Simple Moving Average

Days

BSE

NSE

30

185.06

185.28

50

190.69

190.96

150

170.63

170.82

200

152.77

152.92

Investment Rationalize
  • Leading player in Indian fasteners industry with TVS group as promoters and clientele includes major Indian companies such as Ashok Leyland, BEML, Bajaj, Tata, TVS, M&M, Maruti suzuki and international players such as Volvo, GE, GM, Volkswagen, Ford, Mitsubishi Motors, Bosch, Caterpillar, JCB, Siemens, etc.

  • Sundram Fasteners Ltd has reduced its debts and increased its production capacity, which will help the company when the demand for products picks up.

  • Reduction in crude oil prices and improvement in economic cycle will help the company as the sales of automobiles and the demand for the products increases.

  • Sundram Fasteners Ltd was able to perform well in adverse circumstances and current order book from major players ensures the consistent in foreseeable future.

  • Improvement in economic situations in American and European countries will add significantly to the companies revenue as more than 38% of the revenue comes from exports.

  • Reduction in prices in raw materials and manufacturing expenses will increase the profit margin of the company and Sundram Fasteners have a good dividend history.

  • Price to Sales Ratio of the company stands at 1.82, which means company is reasonably priced, and the past consistent performance and future growth prospects ensures the company is reasonably priced.

  • Increase in revenue from fully owned subsidiaries will add to the companies profits.

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