ALOK INDUSTRIES - SAFE AT THESE LEVELS

Established in 1986, Alok Industries is one of the largest vertically integrated Textile Companies in India is preferred as a Vendor by Global Gaints like Wal-Mart , Target, etc.
The Company announced excellent results recently where its Sales grew by 40.5% to 1241crores. Exports which make up 40% of sales, grew by 40% to 460 crores. The Net Profit should have shooted up but due to Hedgeing, did not reflect the Strong Dollar but this should get reflected in Dec and March results.
The Company has started to focus aggressively on Africa, Latin America and Gulf countries in order to reduce its dependence on the US and Uk.
The Company has been very active in increasing its capacities for the last four years, all of which should start to get executed by March 2009. The Company’s officials have said, that they have no funds requirement as of now and have already tied up for the same.
Alok should start extract benefit from its Capital Investment from the next fiscal.
Alok also has plans to foray into Fabrics used for Car Upholstery, etc and also wrinkle-free, stain-resitant, bullet-proof fabrics.
With the Govt of India too considering a Package to help Exporters, Alok should be major beneficiary.
Alok has taken a huge beating in the Stock Markets. From a High of 103, it is now trading at around 18 levels. With a Book Value of 67 and at a conservative estimated EPS of 8, the stock is now trading of PE of only 2.3. The Stock can be considered in small chunk for Long Term.
CAVEAT :
Rupee appreciation can impact profit margins of the company.


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