Tata Metaliks

Traderji, can you put some of your expert comments for this scrip. The latest news what I am having are:

* Tata Metaliks Ltd (TML) reported a strong year-on-year (y-o-y) revenue growth of 86.5% and an earnings growth of 133.3% for Q3FY2005. Revenues and profit after tax for Q3FY2005 stood at Rs74.2 crore and Rs19.5 crore respectively.

* TML was able to improve its margins in Q3FY2005 on the back of better sales volumes coupled with stable realisations and control on raw material costs. Margins saw an improvement of 548 basis points to 41.2% as compared to 35.7% in Q2FY2005. Pig iron realisations were steady at Rs16,000-17,000 per tonne, whereas on a y-o-y basis these were up by 30%.

* As against the estimated earnings of Rs27.6 per share for FY2005E, TMLs performance was more than satisfactory with earnings of Rs7.7 per share for Q3FY2005 and of Rs21.8 for M9FY2005. Keeping in mind that the benefits of the expansion will be reaped in Q4FY2005 we maintain our profit estimates of Rs69.9 crore and Rs87.2 crore for FY2005 and FY2006 respectively.

* TML is valued attractively at enterprise value (EV)/earnings before depreciation, interest, tax and amortisation (EBDITA) of 4.0x FY2005E and 2.6x FY2006E, and a price/earnings ratio (PER) of 6.1x FY2005E and 4.9x FY2006E at the current market price.

LTP - Rs. 172.55

What you suggest for this scrip.


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