While capital goods stocks have remained out of favour since the market bounce back in March 2009, stocks such as TRF saw a 10-fold increase in their market price between March'09 and May'10. However, the company's financial results at the end of the fourth quarter of FY-10 put an end to the dream rally.

Provision for bad debts incurred came as a jolt after the company reversed revenue as well as costs incurred on some transactions that were pending investigation. This resulted in earnings falling below expectations, dragging the stock price.

Its troubles continued in FY-11 on account of further provisioning done and also due to several high-margin orders not reaching the revenue-booking threshold stage.

By FY-11, net profits were negligible even as consolidated sales grew a good 29 per cent to Rs 1114 crore.

While the order book of Rs 1540 crore as of April'11 provides visibility, concerns of increasing competition in bagging orders continues to act as a drag on the stock.

The company though, has stated that it has seen a strong pick-up in order finalisation in the power sector since March 2011 and had over Rs 1000 crore of order pipeline waiting to be finalised. Over the last one year, the stock declined 56 per cent.

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