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Welspun Corp gains on reporting turnaround in Q2 results

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Welspun Corp rose 1.34% to Rs 79.15 at 14:50 on after the company reported a consolidated net profit of Rs 5.25 crore in Q2 September 2014 compared with consolidated net loss of Rs 33.77 crore in Q2 September 2013.

The company announced Q2 during market hours today, 21 October 2014.

Meanwhile, the Sensex was up 139.20 points or 0.53% at 26,569.05.

On BSE, so far 1.17 lakh shares were traded in the counter, compared with an average volume of 86,634 shares in the past one quarter.

The stock hit a high of Rs 82.70 and a low of Rs 78.15 so far during the day. The stock hit a 52-week high of Rs 107.70 on 10 June 2014. The stock hit a 52-week low of Rs 32.50 on 26 November 2013.

The stock had underperformed the market over the past one month till 20 October 2014, falling 5.28% compared with 2.44% fall in the Sensex. The scrip had also underperformed the market in past one quarter, declining 10.07% as against Sensex's 3.07% rise.

The mid-cap firm has an equity capital of Rs 131.47 crore. Face value per share is Rs 5.

The company's total income rose 9.32% to Rs 2425.30 crore in Q2 September 2014 over Q2 September 2013. Net debt stood at Rs 2345.80 crore at the end of the quarter, compared to Rs. 2983.10 crore at the end of Q1 June 2014. Net worth at the end of the quarter was Rs 2865.30 crore, implying a net debt to equity of 0.82x.

The company's current pipe order book position stands at around 1,040K MT (Rs 7100 crore). During the period between 5th August 2014 (Q1 June 2014 reporting date) and 1st October 2014, the company has won orders of around 400K MT out of which about 190K metric tonne (MT) of orders are from the US market, indicating a sustained recovery in that region. The company has also won orders of about 185K MT from MENA region

The company in its business outlook said the uptick in the North and South American market (especially US), appears to be sustainable with the outlook looking promising in the next year and beyond. For the MENA region, outlook continues to be promising although next year's order quality outlook leaves room for improvement compared to the current year. For the Indian plants, the export market will continue to be the major driver in the near term. As far as the domestic market is concerned, the companyexpect some of the anticipated projects to become business relevant in the medium term. The plate and coil division was operational in Q2 September 12014, largely for captive consumption, and it is expected to continue operations in Q3 December 2014 as well

Welspun Corp (WCL), the flagship company of Welspun Group is a pipe manufacturer.

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