New Multibagger: Shri Lakshmi Cotsyn Limited

Name : Shri Lakshmi Cotsyn Limited
BSE:526049
NSE:NA
Face Value: Rs. 10
CMP :Rs. 116.15 (8/8/2007)
Target : Rs 350 in 8-12 Months
Website : http://www.shrilakshmi.in/


About the Company:

Incorporated in 1988, Shri Lakshmi Cotsyn (SLCL) is Kanpur-based textiles major. The company has two manufacturing facilities in Fathephur, Uttar Pradesh and Sonepat, Haryana. The product range of the company includes blended fabrics, quilted fabrics, fusible interlining and embroidered fabrics. The company is entering the individual home segment with terry towels, home furnishing, denim fabrics, garments and bottom weight fabrics. The company has undertaken a Rs 26.4-million expansion programme in 2006 and commercial production began by Dec. 2006 in all product portfolios such as denim, bottom weight fabrics, bed-sheets and terry towels. The completion of the expansion plan expected soon would add Rs 2,000 million to the total turnover. SLCL has a domestic distribution network of 300 agents across the country for domestic sales, besides supplying defence-related items such as bullet-proof jackets and bullet-proof helmets to defence establishments.


Recent Developments:

• The company forms a joint venture with UK-based company Armet Armored Vehicles under the name of `ARMET ARMORED VEHICLES & SHRI LAKSHMI LTD`. SLCL is participating with 49% equity in the said joint venture company whereas Armet Armored Vehicles, UK is having a 51% equity in over all capital structure. The main business of this joint venture will be to carry on the business of manufacturing of armored vehicles and manufacturing of armor plates, panels, helmets, ballistic body amours, etc and similar safety and security related equipments for domestic as well as foreign market. The manufacturing unit of the joint venture company will he established in dist. Malwa, Fatehpur, Uttar Pradesh.

• The board of directors of Shri Lakshmi Cotsyn (SLCL), a company whose primary activity is textile manufacturing, has approved in principle the issue of foreign currency convertible bonds (FCCBs) or global depository receipts (GDRs) for an aggregate sum of $20 million to fund its ongoing projects. The FCCBs/GDRs would be issued on a preferential basis to foreign institutional investors, financial institutions, a company release says.

• Shri Lakshmi Cotsyn Ltd has informed BSE that the Board of Directors of the Company at its meeting held on July 31, 2007, inter alia, has decided to convert 4 Lacs warrants of Rs 10/- each (issued earlier at a premium of Rs 119/- per warrant) in to 4 Lacs equity shares of Rs 10/- each at a premium of Rs 119/- per share (fully paid-up).

• Reliance Capital Ltd. Holds 130000 shares i.e. 9.03% of the total equity capital as on 30th June 2007

Financials
             Sales        Net Profit        EPS
Q1 2006-07        945.1        34.5        2.52
Q2 2006-07       985.2       51              3.72
Q3 2006-07       1259.9       94.5        6.9
Q4 2006-07       1537.2       118.3        8.64
Q1 2007-08       2247.8       141.4        9.81

Current Reserves : Rs. 150.98 Cr vs equity of Rs. 14.40 Cr. This makes it a great Bonus Candidate. Last 1:1 Bonus was on Jan 2005.

Future Plans

• SLCL is planning for a tie-up with major retail chains abroad such as Wal-Mart in the US for terry towel and other cotton-based textile products the company is manufacturing now. The focus is on the major markets of the US, Europe and the UAE.