Company Visit Note: Ratnamani Metals & Tubes Ltd - NOT RATED - Kotak

RMTL manufactures wide range of stainless steel (SS) and carbon steel (CS) pipes & tubes and caters to sectors such as Oil Refinery, Power and Chemical plants, oil and gas pipeline, water pipelines, etc. The company is positive on CS and SS steel pipes business and expects demand from linepipe, refineries and fertilizer sector.

Key highlights

- RMTL has current order book of Rs 13.4 bn and is also L1 in Rs 3-4 bn of new orders. Based on these orders, its capacity is booked till Q4FY19.

- The company believes that pick up in refinery capex would further enhance its order book and revenue growth in coming years.

- RMTL has a track record of maintaining strong margins 15-20% margins with strong operating cash flows resulting in funding capex largely through internal accruals.

- The company is targeting to achieve ~Rs 23-24 bn of revenue in FY19 based on strong execution in H1FY19 and robust order book with visibility on future order inflows.

Valuation

Based on TTM EPS Rs 49, the stock is trading at PE of 17.8x. We do not have any rating on the stock.

Shares of RATNAMANI METALS & TUBES LTD. was last trading in BSE at Rs.885.9 as compared to the previous close of Rs. 880. The total number of shares traded during the day was 7 in over 6 trades.

The stock hit an intraday high of Rs. 885.9 and intraday low of 866.4. The net turnover during the day was Rs. 6144.

Source : Equity Bulls

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