Kolkata, July 18
SHAKTI Pumps, which has been moving up of late, today created its 52-week high at Rs 117.36 on expectation of a big order from the Madhya Pradesh Government.
The stock finished at Rs 116.35, up 9.04 per cent, on the BSE. The counter's traded quantity also increased to 26,040 shares on the exchange against its 2-week average of 2,286 shares.
Mr Dinesh Patidar, MD, told Business Line over phone from his office at Indore that the Madhya Pradesh State Electricity Board is likely to finalise the proposal for installation of 30,000 stainless steel submersible pumps (stage 3 and 4) shortly.
"We have made presentation for our products and the Canadian consultant, Econoloer Inc, to the SEB proposal is understood to have accorded technical approval for them. Shakti Pumps is hoping to acquire the order, likely to be spread across three years, as there are no stainless steel submersible pump manufacturer in the country," he added. The total order valuation would be around Rs 100 crore.
Stainless steel submersible pumps are considered cost effective in the long term in terms of ground water tapping for agriculture.
The company, which follows the July-June financial year, has a current order book backlog of around Rs 20 crore including $3 million (around Rs 14 crore) from Vervent Inc, one of the large trading outfits in the US.
Shakti had executed export orders from South Africa and Australia worth Rs 4 crore in April last.
Mr Patidar said the company had recently been focusing on exports for better margins. "The export margins are, on an average, higher by 5 per cent considering the current price trends in the domestic market," he confirmed.
According to market sources, the company is likely to report better profitability in the year to June 30, 2005 on the back of greater exports realisation. Shakti had reported a net profit of Rs 1.19 crore in 2003-04 on total sales of Rs 48 crore.
The company board will meet to discuss the annual results for 2004-05 on July 29. For the fiscal 2005-06, the company is targeting exports worth around Rs 35 crore. To achieve this, the company has planned an investment of around Rs 2 crore at its plant through internal resources.
The promoters hold around 46.5 per cent stake in the company and the remaining is with the public.