Friday, January 8, 2010

PSL expands capacity as pipeline orders boom here, abroad ..........

PSL expands capacity as pipeline orders boom here, abroad

PB JAYAKUMAR Mumbai, 7 January
India’s largest pipe manufacturer, PSL Ltd, is augmenting its manufacturing capacity by 300,000 metric tonnes (mt), or about 20 per cent, to meet demand from the oil and gas and water treatment sectors.

The current manufacturing capacity is 1.475 mt and anew 300,000 mt unit is being erected at Visakhapatnam. It will start commercial production by April.

Further, the Rs 2,600-crore turnover company is relocating about 300,000 mt of capacity to Chennai, from its other 11 pipe mills in the country. This is to gain locational advantages, as many new pipeline projects are coming up in South India. The company had earlier raised Rs 200 crore from the secondary market through issue of securities to fund the expansions, said Managing DirectorAshok Punj.

“With this, we will be able to meet demand for the next few years in India and abroad,” he told Business Standard.

Orders worth Rs 5,000 crore from the oil and gas sector and Rs 2,500 crore from the water treatment sector are likely be placed with pipe manufacturers within the next 18 months, Punj said. At present, PSL has an order book of Rs 2,200 crore from the oil and gas and water segments.

Sources said the Indian pipe industry is among the top three manufacturing hubs after Japan and Europe. The market for pipes in the country is about Rs 10,000 crore and is dominated by PSL, Jindal Saw and Wellspun( Now compare PSL with JSW and Welspun Gujarat -Stalhl Rohren Ltd). Raw materials account for more than 70 per cent of the total cost. Normally, orders for pipes are placed by infrastructure companies when steel prices are low.

My Comments:
Readers use to ask me how one can find orderbook position of Cos.I donno any way except looking out for news in pink papers like this I read today in BS....or try to explore through internet....or call and ask CS of the Co.....I have never called any CS of any Co.I have seen people calling CS of the Co to know about how Co is doing and asking queries of their concerns.......I never do that....never call CS of any Co...


  1. Dear Rajeev,

    It almost seems like it is directed at me...LOL

    I have called the Co Secretaries of two companies. One was bhagawati gas and the second was PSL Ltd.

    Mr G.Gehani of PSL has left me with such a positive impression that I will never call the CS of any company again.

    He spoke sternly and in full command for more then half an hour.
    He told me that the right forum for an investor to ask questions to the management is by attending the shareholders meet (AGM) and not by fax or emails.

    He answered all my queries like a teacher would do to a student and yet made not a single speculative statement.

    After talking to him I decided to hold on to PSL for the next five years atleast and not because he gave me any inside info but because he left me with such a strong impression.

    This co is definately very ethical and am sure in times to come will highly reward its shareholders.

  2. Mitz,
    This post was never directed to you...that is for sure...

  3. Hi Rajeev,
    PSL looks like to be a promising investment. We should thanks Mitzz for focusing so much on PSL, so that all readers will be benefited.
    Rajeev, I remember you suggesting Allcargo Global as good investment.
    Recently I came across article on CONCOR ( Container Corp. Of India)
    As per the article CONCOR has cash reserves of Rs.20 bn.& debt-free since 4 yrs. And all know its the leader in cargo business. I personally like and have weak point for debt-free companies like Gillette India, R-Power, Balmer-Lawrie & Oil Country Tubular.( so am invested in them)
    Do you think CONCOR can be sort of investment like WB's Burlington Northern Santa Fe.
    OR still you prefer Allcargo Global.
    With Regards,

  4. Vikas,
    Concor is government congolomarate while AlCargo is Pvt Ltd.....Concor eq is 10 times bigger then AllCargo,but with disinvest going on it can shoot up.But I like Allcargo more....I can't explain why...

  5. can you please explain What is LOL

  6. Dear Rajeevji,

    Can you plz comment on SEL Mfg. Co., a textile /apparel company having cmp of 87.Last year EPS was around 42 and this year looks will touch around 60. Do you look to be a multi-bagger in near future ??

  7. mec,
    SEL Mfg is very speculative stock.If and if only you can digest the volatility then only buy...

  8. ATUL BRAND- Twenty years experience pipe manufacturer and supplier of Delhi/India, provide quality pipe manufacturing in pvc pipe, pvc conduit pipes, conduit pipes, pvc conduits.