Stock watch: Bharat gears

Bharat Gears Ltd (BGL), a member of Raunaq Group of Industries, is gaining some buying interest at the counter of late.

The stock closed at Rs 103.55 on Bombay Stock Exchange (BSE) on Monday compared with its previous close of Rs 103.65, touching an intra-day high of Rs 108 with 21,693 shares traded on Monday.

"A leading domestic mutual fund has shown interest in adding the scrip to its portfolio," says a senior analyst from a domestic broking firm.

At present, the company has an order book of around Rs 200 crore and it is aiming for a turnover of Rs 500 crore in four years.

The company's gross sales have gone up from Rs 11,976 lakh in FY04 to Rs 17,160 lakh in FY05. Net profit margin for the year 2004-05 is approximately 3.5 per cent and EPS was Rs 6.58.

BGL,India's largest gear manufacturer, are pioneers in the manufacture of axle and transmission internal gears. The products of the company are used in India, US, UK and Europe. The company is undergoing a turaround phase and the accumulated losses are coming down.

The automotive industry is generally going through a good phase and analysts feel with the demand picking up and major automotive companies outsourcing their requirements, the stock has a good potential for growth.