Tata Honeywell spurted just as trading commenced only to ease from the upper levels.
In fact, the scrip eased to Rs 277 (up 2.4% from its yesterday's close) only a few minutes since trading commenced on Wednesday after hitting Rs 290 (up 7.2%) prior to that. Around 1,300 Tata Honeywell shares changed hands on BSE so far.
Tata Honeywell has been vindicated by the company's bagging its largest ever export order in the pulp and paper vertical market. In contrast, the scrip had experienced a freefall in the last few sessions, from a 52-week high of Rs 339.70 on 15 January 2003 to Rs 265.70 on 31 January 2003 (down 21.7%).
Tata Honeywell on Tuesday said that the pulp and paper vertical market, has received a significant overseas order for automation of paper machine from Gap Insaat (Yaslik Papers) Turkey valued at $1.80 million (about Rs 8.60 crore) with additional add-on orders worth another $1 million (about Rs 4.80 crore). The project is a stepping stone for the company in the lucrative global pulp and paper market, it said.
For the quarter ended 31 December 2002, the Pune-based industrial automation and control company posted an 8.2% fall in net profit to Rs 1.80 crore on sales of Rs 51.90 core. For the nine months ended 31 December 2002, the company's net profit is at Rs 7.38 crore on sales of Rs 158.85 crore (Rs 1.58 billion). Thus, despite a 12.38% rise in the top line, the company's bottom line has remained flat for the first nine months of FY 2002-03.
THL's overall operations were under pressure during the quarter due to sluggishness in the industrial markets. However, players feel that the revival in most of its user industries namely petrochemicals, refining, oil and gas, chemicals, minerals, mining, metals and power may help THL to post improved results for the fourth quarter.
In order to fuel its plans for the next 12 months, THL, a joint venture between the Tata Group and Honeywell, is planning to invest $3 million (Rs 15 crore). A major part of the funds are likely to be invested in the company's business process outsourcing initiative. Apart from BPO, the company is keen on investing in security solutions and energy management solutions for homes and buildings.
Recently, Indian Oil Corporation roped in THL for its information technology re-engineering project `Manthan'. IOC has awarded this contract to THL. The contract, worth Rs 50 crore, involves implementing supply chain management and scheduling and operations management solutions for the entire supply chain of IOC's fuels business. The scope of the project is likely to be enhanced further in future to cover additional areas and operations of IOC.
THL is gearing up for the future and hopes to grow in spite of the recession. It has identified various areas in each of the important business segments and, as a result, its focus has shifted to industries like food and pharma, where foreign direct investments are reportedly on the rise. The company is also looking at expanding its operations to markets in Sri Lanka and Bangladesh.
THL has projected a turnover of Rs 750 crore (Rs 7.5 billion) by FY 2004-05. To achieve its sales target, it plans to focus on partnering with key customers for value-based long-term contracts. THL expects good growth from its infrastructure business. The company has also restructured, integrated and consolidated all of its offerings with a vertical market focus. This will enable it to meet all the requirements of a customer in a particular vertical, more effectively. This will also give the company an opportunity to focus on a vertical and ensure growth in that business.
THL sees a large potential for growth following its entry into the security business, especially after the rising threat of terrorism across the globe. It also sees potential growth opportunities for its global services, hi-spec and service businesses such as manageability, customer support and performance contracting.
THL is a worldwide leader in automation and control technology. It currently enjoys a leadership position in the Indian automation and control industry with an enviable track record of core industrial automation projects, and pioneering projects in intelligent building control systems.
The industrial automation and control solutions supplied by THL help run companies in the petrochemicals, refining, oil & gas, chemicals, minerals, mining, metals and power sectors.
Its building control solutions help keep productivity and safety high in many large commercial complexes and industrial plants.
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