Jyoti Ltd: A detailed analysis.

Company Overview:

The Jyoti Group of Companies is a conglomeration of industrial units involved in manufacturing and marketing a wide range of electrical and hydraulic engineering equipment used extensively in the vital sectors of national and international economy.

 

Industries serving:

 

·      Power Generation (Thermal, Hydel and Nuclear)

·      Power Transmission and Power Distribution Agriculture

·      Providing Irrigation through Pumping Systems

·      Water Supply and Sewerage Schemes

·      Naval and Marine Establishments

 

Key metrics: Let’s have a look at the main key metrics of the company:

Current Price

Rs 70.4

Market Cap

Rs 163 Cr

PE

20.5

PEG

0.64

Debt to Equity

Operating Profit Margin

6.74%

Promoter Shareholding

24.2%

DII Holding

1.33%

FII Holding

NIL

F24 Financial Highlights:

► YoY Revenue growth        :12%

► YoY PAT growth               :100%

► YoY EPS growth               :98%

Q4 Financial Highlights:

► QoQ revenue growth        :18%

► QoQ PAT growth               :231%

► QoQ EPS growth               :232%

Products and Services:

â–º Engineered Pumps & Projects- Vertical Turbine Pump

â–º Hydel-Turbines, Inlet Valves, Hydro Generators

â–º Switchgears includes-Vaccum Circuit Breakers (Indoor and Outdoor), Vaccum Contactor

► Electronics and Control System 

Major Projects/ Clients:

  • West Bengal State Electricity Board
  • Gujarat Electricity Board
  • Rajasthan State Electricity Board
  • Kerala State Electricity Board
  • Tamil Nadu State Electricity Board
  • Atria Power Pvt. Ltd., Bangalore
  • International Power Corpn.Ltd., Bangalore
  • Truong Thanh Construction Company Ltd., Song Lam Investment & Construction Co. Ltd. (Vietnam)
  • Soham Energy , Bangalore
  • Limbavali Power Projects, Bangalore
  • Himurja Pvt Ltd, New Delhi
  • Maruthi Power Gen Pvt. Ltd., Bangalore
  • NTPC, NOIDA
  • Global Hidro Energi, Tirta Gemah Ripah, Global Hidro Energi (Indonesia)

Positives:

â–º 3Y compounded sales growth of 15%.

â–º 3Y compounded profir growth of 59%

â–º 70 years of Engineering Excellence

â–º Jyoti is the only manufacturer of major equipments used for hydro project which includes hydro turbines, generators, butterfly and spherical valves, governor, HT & LT Switchgear, Instrument Transformers.

► Jyoti Sohar Switchgear LLC was incorporated in 2000. The Company is promoted jointly by Jyoti Ltd. and the Omar Zawawi Establishment (OMZEST), Sultanate of Oman. The Company is located in Sohar Industrial Estate, Sohar, Sultanate of Oman, marking it’s global presence and the opportunity.

► Serving sectors such as Power Generation – Thermal and Nuclear, Lift Irrigation Schemes, Urban Water Supply, etc

Negatives:

â–º Debt of Rs 242 Cr against the negative reserves of Rs -88Cr.

â–º Low ROE of 6%.

â–º TTM profit growth of -26%.

â–º WEG Industries (India) Pvt. Ltd has filed a civil suit on 3rd May, 2024 against the Company for recovery of encashment of Bank Guarantee for an amount of Rs.1,91,91,639/- along with interest at the rate of 12% p.a. from the date of the suit, though the company has a strong on merits and management is of the belief that it will not cause any financial implication on the company.

 

Future Prospects:

Though the company is not growing at any impressive rate as expected from it’s experienced management and old reputation of the company, however the management said that persistent efforts are being made by the Company improvement to collect receivables.

            The Company has also set up a strategic senior management team to recover claims outstanding from various clients. Further, Company has taken steps to reduce overheads substantially by concentrating its attention on manpower, material, financial cost and other administrative expenses to improve profitability. With the streamlining operations, expected improvement in overall business scenario and healthy order book position, the Company would definitely grow in the coming years.

With the growth of Indian economy will create the demand for improved infrastructure in Hydel and renewable sector this coupled with government push, Jyoti Ltd is likely to be the major beneficiary of net zero targets of the world. Also, company is currently focusing on cash flow, controlling of overheads and ensuring raw material inflow for production. Company expects improved business operations with margins during current year.

In view of ongoing operations with improved business prospects, continues to execute orders in hand, increasing and giving additional focus on turnover of spares, retrofit & service orders which contribute good margin and obtain new orders despite adversities from private as well as public sector, positive EBITDA, robust cost controls, directors are very positive about the Company’s viability and optimistic about its future. Though the company is not growing at any impressive rate as expected from it’s experienced management and old reputation of the company, investors can keep track of this company due to the favourable sectoral push in this sector.

Disclaimer:

We are not a SEBI registered analyst, IndianMultibaggers will not be responsible for any loss in future. Please do your own research and consult your financial advisor before taking any investment decision. The prices and data may vary according to the market forces at the time of reading this article.

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