Precision Camshafts Ltd IPO Message Board (Page 46)

IPO price was 765

WHAT A MIND YOU CANNOT CHANGE IT AS PER YOUR WILL

BE FIRM WITH MIND BODY AND SOUL

Same here weekness in market and corporate governance issue I think I will skip the issue and buy after listing
Today on Hindu ( business line) IMO best IPO reviews have recommended NOT TO APPLY

Weak links in the chain: Precision Camshafts

Good business fundamentals and efforts to make value additions to the product mix favour Precision Camshafts, an export focused auto component manufacturer with an 8 per cent global market share in camshafts.

But given that the market capitalisation of the stock will be around Rs 1,700 crore and that the size of business is much smaller than other component makers with substantial overseas operations, its valuation of 19 times the expected 2016-17 earnings is a bit on the high side. Considering the current volatility in the stock markets and the fact that small-caps may be more vulnerable to corrections, investors can keep away from the offer.

Holds promise
Precision Camshafts derives about three-fourths of its revenues from export of camshafts (castings and machined), predominantly for passenger cars.

While Ford and General Motors are its key clients, each bringing in 25-35 per cent of the revenues, the UK, Germany, Spain and the US are some of its key markets. The company makes over 150 varieties of camshafts.

The more complex castings and machined camshafts fetch higher realisations and superior operating margins. Over the last four fiscals, machined camshafts have contributed about 30-35 per cent to revenues.

Average realisations have improved steadily from Rs 375 per camshaft in fiscal 2011 to Rs 504 in fiscal 2015. Since fiscal 2012, net sales (Rs 516 crore in 2014-15) has grown at a compounded annual rate of 19.9 per cent and net profits (Rs 62.3 crore in 2014-15), by a CAGR of 45.3 per cent.

Currently manufacturing the chilled cast iron variety of camshafts, the company is expanding into the ductile iron variety and assembled camshafts. This is expected to help bring Japanese auto makers such as Toyota and Suzuki which this variety, on board.

It is towards setting up a machine shop for ductile iron camshafts that the company is raising about Rs 240 crore from this IPO, apart from an offer for sale for about Rs 170 crore from promoters.

While ductile iron camshaft castings per se are not a higher margin business, machining operations on these are expected to help better realisations and margins.

The trend of increase in outsourcing of machining operations for these components by auto manufacturers is expected to aid on this front.

Weak areas
Favourable foreign exchange movements, availability of certain export incentives from the government and production of some value-added camshaft varieties have helped operating margins soar to 24-26 per cent in fiscal 2015 and in the first six months of this year. Earlier margins have been at around 10-13 per cent.

The sustainability of over 20 per cent margins in the next two-three years is a question.

Over the long term, it may expand based on acquisition of higher machining business.

Secondly, three key promoters/management personnel have taken home a remuneration and commission of about Rs 19 crore and Rs 13 crore respectively in 2014-15. This seems high, compared to the net profit of Rs 62 crore for this period.

Finally, while there are no direct peers, despite its smaller size, the valuation is on par with bigger and more mature Indian companies that are focused in the overseas markets, such as Bharat Forge and Motherson Sumi.

As per Bloomberg estimates, other foreign companies that have a presence in camshafts such as Musashi Seimitsu, ThyssenKrupp and Linamar trade at 7.5-9.5 times FY17 earnings.

Chem Cho mind ur own business. I don''t need ur advice. I m not saying I will not apply still. I would just wait to see last day subscription figures. Ur attitude stinks. Maybe u stink as well. Who knows?

THIS SHOW YOU DONOT HAVE CONTROL ON MIND
I AM SORRY IF IT HURTS YOU

septaji applay or avoid this ipo ?

I don''t need a certificate from u Chem Cho. U instead of commenting on other people its better if u mind ur business. Neither are u a psychologist to comment how other people r. This only shows ur immaturity. Passing useless comments on other people n gloating about self if u succeed shows how strong n macho u r. First learn how to behave in a society n in a forum.

Just a humble suggestion from my side ... to all the grand masters in this forum ...

Since many of us in this group are confused ... I suggest let us all review whether to apply or not after we see the "Anchor Investors" list ... which will be available this evening ...

It could turnout to be a case like NH .. where the GMP kept 65 all the way down to 8-10 ... then then started rising after the Anchor list showed "Govt. of Singapore" as an investor.

Anchor investor is important but not always many time we have seen last year got anchor investor but share is still listed at discount. One very interesting think I found that biggest car market in India maruti has come on board lately. Why maruti not sourcing camshaft from the biggest player in Indian market.

If issue like NH Dr Lal and SH kellar have given very good return this issue should also but corporate governance is the biggest drag

YOU ARE STILL ANGRY YOU HAVE NO CONTROL ON MIND SEEMS
YOU HAVE LOST OF MONEY IN STOCK MARKET

ARE YOU THE ONE WHO HAS LOST MONEY IN INDIGO

Chem cho get urself checked in a hospital. U have a habit of talking nonsence. Has Indigo price gone below IPO price? I don''t trade. N I hold long term. If Indigo is not below issue price then I have not lost any money. Maybe u have. Ur stupid comments makes one laugh at urchildish comments. It seems u can''t improve. Its better I stop replying to ur absurdity. I thought maybe my sarcastic comments will shame u into behaving. But no u have a one big ego n no brains. N I have realised that if u throw stone in muck the muck is going to come on u only. So u can keep blabbering now. Have a field day.

Hi Eagleye,

Can you share link? From Where are you getting these details?

there is no link to share ... these are just market whispers ... heard through a network of reliable market players ...

it all depends on what price band they come out The company, which has been growing at a compounded annual growth rate (CAGR) of 37 per cent, is estimated to have a revenue of $500 million last year. so the size of mind tree MC is around 12000 crs..... so price should be at least at discount to mind tree.... let wait for its price band one thing it is very good franchise however last IPO from the group was not good to investor i think it issue at 52 and stay below fifty for long time in fours years the return has not been much.....

nope u cannot apply in the old method