Transformers and Rect 'powers' up

Transformers and Rectifiers is seemingly having a dream run on the bourses, hitting new highs consistently. Today it has breached the 5% upper circuit at Rs.206.95, which is also a new 52-week high.

Apart from the overall optimism in the power stocks, expecting major sops from the Budget, the stock is up after the company stated that it had received an order from Gujarat Energy Transmission Corporation for supply of 220Kv and above class of transformers aggregating to 5,590 MVA. The total value of this order is Rs.161 crore and post this, its  order book currently stands at around Rs 550 crore.

For Q4Fy14, the company recorded a whopping 128% jump in net profit at Rs.9 crore on a 20% jump in net revenue at Rs.240 crore. But FY14 numbers were not as exuberant, as the previous three quarters had been weak. It ended FY14 with a 413 rise in consoldiated net sales at Rs.720 crore and rise in net profit was very flat, lower than net profit of Q4, at Rs.5.18 crore v/s Rs.4.91 crore in FY13, up just 5.5%. Vis-à-vis the Q4 numbers, this Fy14 performance looks very dull.  The company blamed the lower FY14 performance on the Govt due to poor decision making, stalling several crucial projects. But with order inflows picking up from Q4, the company expects the trend to continue in FY15, a fiscal which it expects to be much better. For FY15, it has set itself a target of 27,000 MVA, which should not be tough given the 20,650 MVA it managed to achieve in FY14, despite three poor quarters.