The document provides an analysis and recommendation for Man Industries (India) Ltd stock. It summarizes the company's Q1 FY16 results showing increases in net profit, revenue, EPS and EBITDA compared to the same period last year. It recommends buying the stock with a target price of Rs. 135, citing anticipated revenue and profit growth, reasonable valuation multiples and positive industry outlook.

1. CMP 117.50
Target Price 135.00
ISIN: INE993A01026
JULY 20th
, 2015
MAN INDUSTRIES (INDIA) LTD
Result Update(PARENT BASIS): Q1 FY16
BUYBUYBUYBUY
Stock Details
Stock Data
Sector Construction & Engineering
BSE Code 513269
Face Value 5.00
52wk. High / Low (Rs.) 127.10/44.40
Volume (2wk. Avg ) 575000
Market Cap (Rs in mn.) 6709.72
Annual Estimated Results (A*: Actual / E*: Estimated)
Years FY15A FY16E FY17E
Net Sales 13640.20 17595.86 20235.24
EBITDA 1523.30 1955.86 2262.40
Net Profit 535.60 770.57 928.43
EPS 9.38 13.49 16.26
P/E 12.53 8.71 7.23
Shareholding Pattern (%)
1 Year Comparative Graph
MAN INDUSTRIES (INDIA) LTD BSE SENSEX
SYNOPSIS
Man Industries (India) Ltd is a leading
manufacturer of SAW Pipes (Line Pipes) & Coating
Systems for high-pressure Oil & Gas applications
with a potential production.
Net profit during the June quarter increased by
460.44% to Rs. 177.10 million from Rs. 31.60
million in the same quarter of previous year.
During the quarter, Revenue rises by 75.46% to
Rs. 4053.00 million from Rs. 2309.90 million over
the corresponding quarter last year.
In Q1 FY16, EBIDTA is Rs. 482.80 million, an
increase of 121.67% as against Rs. 217.80 million
in the corresponding period of the previous year.
Earnings per Share for the company were Rs. 3.10
in Q1 FY16 as compared to Rs. 0.55 in Q1 FY15.
Total income of the company in Q1 FY16 stood at
Rs. 4213.30 million against Rs. 2463.40 million in
the corresponding quarter of the previous year.
During the quarter, MAN Industries Ltd. gets
Export Orders of worth Rs. 5100 million from
international markets for oil & gas sector.
Net Sales and PAT of the company are expected to
grow at a CAGR of 26% and 119% over 2014 to
2017E respectively.
PEER GROUPS CMP MARKET CAP EPS P/E (X) P/BV(X) DIVIDEND
Company Name (Rs.) Rs. in mn. (Rs.) Ratio Ratio (%)
Man Industries (India) Ltd 117.50 6709.72 9.38 12.53 1.37 30.00
SPML Infra Ltd 69.10 2532.50 3.75 18.43 0.54 0.00
Praj Industries Ltd 108.60 19272.70 3.86 28.13 3.13 81.00
Skipper Ltd 168.00 17189.20 8.72 19.27 5.37 10.00

2. QUARTERLY HIGHLIGHTS (PARENT BASIS)
Results updates- Q1 FY16,
Months June-15 June-14 % Change
Net Sales 4053.00 2309.90 75.46
PAT 177.10 31.60 460.44
EPS 3.10 0.55 460.44
EBITDA 482.80 217.80 121.67
The Company net profit stood to Rs. 177.10 million, an increase of 460.44% against Rs. 31.60 million in the
corresponding quarter ending of previous year. The company achieved a turnover of Rs. 4053.00 million for the
1st quarter of the current year 2015-16 as against Rs. 2309.90 million in the corresponding quarter of the
previous year, grew by 75.46%. Reported earnings per share of the company stood at Rs. 3.10 a share during the
quarter, registering 460.44% increase over previous year period. Profit before interest, depreciation and tax is
Rs. 482.80 million as against Rs. 217.80 million in the corresponding period of the previous year.
Break up of Expenditure
Particulars
Rs. Million
Q1 FY16 Q1 FY15 % Chng
Cost of Material
Consumed
3189.80 1004.40 218%
Employee Benefit
Expenses
101.80 94.40 8%
Depreciation &
Amortization
93.90 89.50 5%
Other Expenditure 388.30 165.90 134%

3. Company Profile
Man Industries (India) Ltd. is an ISO-9001/14001/18001 accredited company, is a leading manufacturer of SAW
Pipes (Line Pipes) and Coating Systems for high-pressure Oil & Gas applications with a potential production
capacity of approximately one million MT of SAW pipes per annum.
The company is a part of the well diversified MAN Group, growing under the dynamic leadership of Mr. R.C.
Mansukhani. Starting as an Aluminium Extruder in 1988, MAN Industries has now become one of the largest
players in LSAW Pipes, Spirally Welded Pipes and Coating Systems. MAN Industries operations are spread
globally with offices in U.S. and U.A.E, besides India.
Products
• L Saw
Man Industries manufactures Longitudinal Submerged Arc Welded (LSAW) Line Pipes of various sizes and in
conformance with various specifications to meet the growing Global demand of high pressure, cross-country
pipeline owners and operators.
• H Saw/Spiral
The company, keeping up with the pace of industrial movement, is committed to make some major
investments for expansion of its Helically Submerged Arc Welded (HSAW) Line Pipe manufacturing facilities.
• Coating
• Single layer FBE, 3 Layer PE & 3 layer PP Coating
• Internal Blasting & Painting
• Coaltar Enamel Coating.

4. Financial Highlight (PARENT BASIS) (A*- Actual, E* -Estimations & Rs. In Million)
Balance Sheet as at March 31, 2014 -2017E
FY14A FY15A FY16E FY17E
EQUITY AND LIABILITIES:
Shareholders’ Funds:
Share Capital 285.52 285.52 285.52 285.52
Reserves and Surplus 6347.07 4600.80 5290.92 5978.74
A. Sub Total - Net worth 6632.59 4886.32 5576.44 6264.26
Non-Current Liabilities:
a) Long-term borrowings 3097.61 2646.80 2435.06 2288.95
b) Deferred Tax Liabilities [Net] 536.77 424.00 360.40 317.15
c) Other Long Term Liabilities 8.04 14.50 16.10 17.54
d) Long Term Provisions 131.39 144.00 155.52 164.85
B. Sub Total – Non Current Liabilities 3773.81 3229.30 2967.07 2788.50
Current Liabilities:
a) Short-term borrowings 1087.28 1195.40 1302.99 1394.20
b) Trade Payables 3625.57 3984.00 4183.20 4225.03
c) Other Current Liabilities 446.59 996.30 1026.19 1067.24
d) Short Term Provisions 213.09 190.80 198.43 202.40
C. Sub Total - Current Liabilities 5372.53 6366.50 6710.81 6888.86
Total Liabilities (A+B+C) 15778.93 14482.12 15254.32 15941.62
Non-Current Assets
Fixed Assets
i. Tangible assets 4031.82 3535.30 3676.71 3787.01
ii. Capital work-in-progress 19.27 34.00 40.12 44.93
a) Sub Total-Fixed Assets 4051.09 3569.30 3716.83 3831.94
b) other non-current assets 498.13 415.00 423.30 427.53
c) Non Current Investments 190.09 1010.00 1161.50 1277.65
d) Long Term Loans and Advances 267.02 741.21 815.33 864.25
D. Sub Total - Non-Current Assets 5006.33 5735.51 6116.96 6401.38
Current Assets:
a) Current Investments 15.92 8.90 9.26 9.35
b) Inventories 1154.15 1360.11 1509.72 1630.50
c) Trade Receivables 2825.06 4655.80 5124.89 5358.22
d) Cash and Bank Balances 1784.32 1483.20 1512.86 1527.99
e) Short Term Loans and Advances 4787.90 1110.80 842.60 867.88
f) Other Current Assets 205.25 127.80 138.02 146.31
E. Sub Total-Current Assets 10772.60 8746.61 9137.36 9540.24
Total Assets (D+E) 15778.93 14482.12 15254.32 15941.62

5. Annual Profit & Loss Statement for the period of 2014 to 2017E
Value(Rs.in.mn) FY14A FY15A FY16E FY17E
Description 12m 12m 12m 12m
Net Sales 10052.90 13640.20 17595.86 20235.24
Other Income 308.00 375.10 442.62 473.60
Total Income 10360.90 14015.30 18038.48 20708.84
Expenditure -9502.90 -12492.00 -16082.61 -18446.44
Operating Profit 858.00 1523.30 1955.86 2262.40
Interest -417.60 -457.30 -498.46 -538.33
Gross profit 440.40 1066.00 1457.40 1724.06
Depreciation -317.70 -424.50 -466.95 -522.98
Profit Before Tax 122.70 641.50 990.45 1201.08
Tax -33.70 -105.90 -219.88 -272.64
Net Profit 89.00 535.60 770.57 928.43
Equity capital 285.52 285.52 285.52 285.52
Reserves 6347.10 4600.80 5290.92 5978.74
Face value 5.00 5.00 5.00 5.00
EPS 1.56 9.38 13.49 16.26
Quarterly Profit & Loss Statement for the period of 31st Dec, 2014 to 30th Sep, 2015E
Value(Rs.in.mn) 31-Dec-14 31-Mar-15 30-Jun-15E 30-Sep-15E
Description 3m 3m 3m 3m
Net Sales 2020.70 6548.20 4053.00 4660.95
Other income 75.90 133.50 160.30 51.30
Total Income 2096.60 6681.70 4213.30 4712.25
Expenditure -1875.50 -5824.90 -3730.50 -4278.75
Operating profit 221.10 856.80 482.80 433.49
Interest -100.80 -173.80 -135.90 -132.64
Gross profit 120.30 683.00 346.90 300.86
Depreciation -97.40 -140.40 -93.90 -99.53
Profit Before Tax 22.90 542.60 253.00 201.32
Tax -4.20 -94.70 -75.90 -46.42
Net Profit 18.70 447.90 177.10 154.90
Equity capital 285.52 285.52 285.52 285.52
Face value 5.00 5.00 5.00 5.00
EPS 0.33 7.84 3.10 2.71

6. Ratio Analysis
Particulars FY14A FY15A FY16E FY17E
EPS (Rs.) 1.56 9.38 13.49 16.26
EBITDA Margin (%) 8.53 11.17 11.12 11.18
PBT Margin (%) 1.22 4.70 5.63 5.94
PAT Margin (%) 0.89 3.93 4.38 4.59
P/E Ratio (x) 75.39 12.53 8.71 7.23
ROE (%) 1.34 10.96 13.82 14.82
ROCE (%) 10.87 22.32 26.01 28.00
Debt Equity Ratio 0.63 0.79 0.67 0.59
EV/EBITDA (x) 10.60 5.95 4.56 3.91
Book Value (Rs.) 116.15 85.57 97.65 109.70
P/BV 1.01 1.37 1.20 1.07
Charts

7. Outlook and Conclusion
At the current market price of Rs. 117.50, the stock P/E ratio is at 8.71 x FY16E and 7.23 x FY17E
respectively.
Earning per share (EPS) of the company for the earnings for FY16E and FY17E is seen at Rs. 13.49 and Rs.
16.26 respectively.
Net Sales and PAT of the company are expected to grow at a CAGR of 26% and 119% over 2014 to 2017E
respectively.
On the basis of EV/EBITDA, the stock trades at 4.56 x for FY16E and 3.91 x for FY17E.
Price to Book Value of the stock is expected to be at 1.20 x and 1.07 x for FY16E and FY17E respectively.
We recommend ‘BUY’ in this particular scrip with a target price of Rs. 135.00 for Medium to Long term
investment.

8. Industry Overview
The Indian Engineering sector has witnessed a remarkable growth over the last few years driven by increased
investments in infrastructure and industrial production. The engineering sector, being closely associated with
the manufacturing and infrastructure sectors of the economy, is of strategic importance to India’s economy.
Growth in the sector is driven by various sub-sectors such as infrastructure, power, steel, automotives, oil and
gas, consumer durables etc.
India on its quest to become a global superpower has made significant strides towards the development of its
engineering sector. The Indian government has appointed the Engineering Export Promotion Council (EEPC) to
be the apex body in charge of promotion of engineering goods, products and services from India. India exports
transport equipment, capital goods, other machinery/equipment and light engineering products such as castings,
forgings and fasteners to various countries of the world.
Coupled with favourable regulatory policies and growth in the manufacturing sector, many foreign players have
started to invest in the country. India recently became a permanent member of the Washington Accord (WA) on
June 13, 2014. The country now joins an exclusive group of 17 countries who are permanent signatories of the
WA, an elite international agreement on engineering studies and mobility of engineers.
Driven by strong demand for engineering goods, exports from India registered a double digit growth at 10.22 per
cent to touch US$ 26.4 billion in June 2014 from US$ 24.02 billion in the corresponding month last year. This
growth can be credited to the robust expansion in shipments of aircraft, spacecraft parts and automobiles. The
second best performing sector was non-ferrous metals and metal products.
Engineering exports from India are expected to cross US$ 70 billion in FY 15 registering a growth of 15 per cent
over the previous fiscal, as demand in key markets such as the US and the UAE is on the rise. Apart from these
traditional markets, markets in Eastern and Central European countries such as Poland also hold huge promise.
Road Ahead
The engineering sector is a growing market. Current spending on engineering services is projected to increase to
US$ 1.1 trillion by 2020. With development in associated sectors such as automotive, industrial goods and
infrastructure, coupled with a well-developed technical human resources pool, engineering exports are expected
to touch US$ 120 billion by 2015.
Also, the Union Budget 2014-15 has allocated funds for several infrastructure projects which are further
expected to provide a boost to the engineering sector. The industry can also look forward to deriving revenues
from newer services and from newer geographies with Big Data, Cloud, M2M and Internet of Things becoming a
reality.

9. Disclaimer:
This document is prepared by our research analysts and it does not constitute an offer or solicitation for the
purchase or sale of any financial instrument or as an official confirmation of any transaction. The information
contained herein is from publicly available data or other sources believed to be reliable but we do not represent that
it is accurate or complete and it should not be relied on as such. Firstcall Research or any of its affiliates shall not be
in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the
information contained in this report. Firstcall Research and/ or its affiliates and/or employees will not be liable for
the recipients’ investment decision based on this document.

10. Firstcall India Equity Research: Email – info@firstobjectindia.com
C.V.S.L.Kameswari Pharma & Diversified
U. Janaki Rao Capital Goods
B. Anil Kumar Auto, IT & FMCG
M. Vinayak Rao Diversified
G. Amarender Diversified
Firstcall Research Provides
Industry Research on all the Sectors and Equity Research on Major Companies
forming part of Listed and Unlisted Segments
For Further Details Contact:
Tel.: 022-2527 2510/2527 6077 / 25276089 Telefax: 022-25276089
040-20000235 /20000233
E-mail: info@firstobjectindia.com
www.firstcallresearch.com