Bharat Earth Movers Limited: Mining Restoration Set Off



After a prolonged recession in mining due to the ban in Karnataka and Goa, the leads for BEML could enhance. Income from the infrastructure equipment section is positioned for a restoration as requirement for facilities devices are seen enhancing from it

3-04-2014 - EPC News: 3 April,2014: India:After a prolonged recession in mining due to the ban in Karnataka and Goa, the leads for BEML could enhance. Income from the infrastructure equipment section is positioned for a restoration as requirement for facilities devices are seen enhancing from it all fourth quarter of 2014.

We are expecting some enhancement in requirement. Though, it could take 6 or 7 months to produce require. The Street has begun to look at that in enhance as this could have a positive effect on BEML, said Misal Singh, who tracks the sector at Religare Capital Markets.

While the market has began detecting a recovery in profits & better income in FY15, the inventory at Rs 267 is at 50 % its book value.

Moreover looking up for business fundamentals, the domestic changes and cost control measures undertake by BEML are equally important. Thanks to greater working capital needs interest costs increased and worn away earnings. On this, the company is creation the thin end of the wedge to manage stock & cut interest price. Outcomes are starting to demonstrate.

The company made a benefit in the Dec quarter against impairment in the 1st & 2nd quarter of FY14. Quarterly run-rate of interest price has come down from a optimum of Rs 40 cr in the March 2013 quarter to lower than Rs 30 cr lately. This, to a large level, assisted BEML come back to profits. BEML said because of these internal initiatives one can expect the March 2014 quarter to be superior than the Dec 2013s.

Since FY13, mining has been in a downward spiral in India as well as globally. In India, the construction sector was also under pressing. More, there have been intense pressing on margins, with global companies dumping their products & undercutting prices, said P Dwarakanath, chairman & MD in BEMLs annual review for 2012-2013.

Bharat Earth Movers Limited (BEML) has taken steps to sustain revenues. The company has been focusing on the railways business, as well as international markets. Together have in the recent revealed good growth & helped sustain the preferred sales.


With the present order book at Rs 6,000 cr, or 2 times its FY13 revenues, BEML is in a relaxed position for a year or 2. Though, most of the stocks re-rating is determined by the durability of household requirement, exclusively from the mining & infrastructure space. In the long run, defense & Rail & Metro should bear fruit.


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