I have time and again came out with stocks which I felt like becoming a large size.In past stocks like Gayatri Pro,Madhucon Pro,Lumax Ind,Apar Ind, Navin etc has been focused here.
In Mid sep 09 I came out with a BUY call on Petron Eng and I remember on the very previous day it went in for a 20% upper circuit and still I came out with a buy call.Those reading my blog must be thinking that I am trying to offload my holding and hence I am recomending stock which has been in 20% upper circuit.
I have been accused of that in past.
Petron then went down to something like 139 , but finally it is over 200 and made a 52 week high at Rs229 and settled at 219 on last trading day.
I am here pasting latest interview of their MD which I retrieved from Money control site...this interview was given on 16th Oct 09...
Petron Engineering Construction is mainly into refineries, petrochemical, cement, and power sector.
TS Das, Managing Director, Petron Engineering Construction, says the company has a current order book of around Rs 1,000 crore. “We expect orders worth Rs 400-600 crore in next two quarters.”
Here is a verbatim transcript of the exclusive interview with TS Das on CNBC-TV18. Also watch the accompanying video.
Q: Your company provides services to companies in the refinery, power and cement sector we understand. Could you take us through what has been the flow of orders? What was it at the peak in 2007-08, and what was the fall? Are you seeing a revival in order book?
A: Yes. We are mainly in the refineries and petrochemical, cement and power sector. After the recession, our order books are looking up, and are much better. Presently, we have an order book of about Rs 1,000 crore. We have compared to the last year – we used to do a turnover of around Rs 280 crore and now this year we have done around Rs 460 crore. So, things are looking up and the situation seems to be good, because the power plant sector is coming up in a large way, and cement, which had slumped slightly, has also come up in a big way. A few refineries are also on their way. We are always a player in the refinery business. Currently, refineries, what we are doing is for Bharat Petroleum and Bina Refinery; we are doing it in Panipat, Bhatinda Refinery and also in Chennai Petroleum.
Q: Are there expansions happening in that space, or are people pulling back their capex in refinery?
A: No. They are very much in full blast. Rather we are in a tight schedule. I would say in Chennai Petroleum and Gujarat Refinery, we are fighting against time and trying to complete the plant for them. Similarly, Paradip Refinery has now started in full blast. So, all the packages for the territory has come up, which is pretty good.
Q: Could you give us some sort of a timeline when these Rs 1000 crore worth of orders would be executed over what time period? Your blended operating margins have been at about 7.25%, previously it was at about 7.4% on YoY basis. On a net profit level, you are just making a margin of about 2-2.5% odd. Are we seeing better days because I believe there were certain legacy orders that you have written off at this stage?
A: Yes. I think this is the present situation because we have inherited some legacy orders after the takeover of the company a couple of years back. But now we have done most of the write-offs and that created the main erosion in the margins. Now I think it should look up for the future because the order book position is also good. So, we should be able to do better.
Q: What sort of a margin level do you sense you would be working at, at an operating level?
A: At the gross level, I would say this kind of business is around 10%.
Q: How much would you be expecting over the next couple of quarters in terms of an order flow?
A: In the next couple of quarters, we should be expecting in the region of around Rs 400-600 crore worth of orders because we are also following up with a few of them in the power sector. Refinery is one of the main areas, which is coming up very well. Mangalore Refinery packages are coming up and similarly for the Paradip Refinery as well.
Some BIG orders I am listing here :
Petron Engineering wins Rs 3.83 billion order from Utility Energytech :
Petron Engineering Construction has informed that it has won an order of Rs 3.83 billion from Utility Energytech and Engineers, Noida, Uttar Pradesh (UP).
Company's scope of work under the order includes erection of boiler package at Rosa Stage - II, thermal power project, UP.
The sources informed that the conglomerate runs through its five divisions of Construction, Pertron Mechanical Industries, Petrofab, Petrotech, as well as Rockwool Insulation.
Petron Engineering Construction is a leading provider of total solutions in engineering construction.
Mumbai-based Petron Engineering Construction has secured an order worth Rs 154.42 crore from PowerGen Infrastructure for construction related works.
The scope of work includes erection and associated works of Boiler, Auxiliaries and TG Auxiliaries of Unit No. 1 and 3 out of 3 x 660 MW Tiroda Thermal Power Project of Adani Power Maharashtra at Tiroda, Dist Gondia, Maharashtra.
Petron Engineering incorporated in 1976, provides services in mechanical, erection, piping, electrical, instrumentation, painting, refractory and insulation work for refineries, chemicals, petrochemicals, cement, fertilizers, metallurgical, power plants and other industrial plants.
Petron Engineering gets order worth Rs 352 crore:
Petron Civil Engineering, a subsidiary of KazStroy Services Plc. has bagged an order worth Rs 352 crore from Hindustan Petroleum Corporation-Mittal Energy joint venture. The total order stands at Rs 600 crore and is meant for the Guru Govind Singh Refinery Project at Bhatinda (Punjab). The contract work would include civil, structural, underground piping and pavements for units.
Over and above they have a very good record of completing the projects well in time .The clients list is big and strong like BHCL,HPCL,Ril Ind, Chennai Petro,Zuari Agro,RCFL,GSFC,Grasim,IOC,BPCL,MRPL etc etc.....the list is long ...and when Ril give certificate that Petron has completed project well in time , it speaks volumes about this co as Ril is known for completing project ahead of time or in time......otherwise they will not give orders to any Co....
The future of Petron Eng is looking extremly bright to me .....