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Saturday, January 5, 2008

Revathi Equipment Ltd. TOP RATED STOCK FOR NEXT TWO YEARS


presenting the Thirtieth Annual Report :

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Performance Review :-

Your companys focus on development of new products and new markets continues with more investments being made in this regard. A number of new drills both for domestic and export markets have been developed and some more are in progress. The progress in development of concrete equipments has been good as we are now able to offer a basket of products to the market comprising of Transit mixers, concrete pumps and batching plants; some more variants are being introduced this year.
Business Environment
Revathi is engaged in supplying product needs of infrastructure sector. The blast hole drills are essential for production of coal, iron ore, lignite etc.; the major requirements come from coal mines. Revathi has now started offering a wider range of concrete equipments comprising of batching plants (that prepare the concrete mix), transit mixers (that transport the concrete mix) and Concrete pumps ( that lift the concrete to desired height )The product variants are being expanded to meet current and emerging needs of our customers.
The business outlook for domestic business for Drills appears to be encouraging based on indications of requirements of various customers for the year. Construction equipments are expected to make their meaningful presence in the market this year.
Your Companys association with Bucyrus International, U.S.A. in development of various sizes of Drills which increases their range of offerings and meets their market needs of such Drills. These Drills have undergone thorough testing and have been demonstrated to different customers. Bucyrus is confident of sourcing from your Company.

The orders on hand for export approximate Rs 220 millions. The demand trend in world market is strong and our customers expectto increase their demand for our Drills in ensuing years.
US $ depreciation is a cause of concern though we stand protected substantially for the year. We propose to take necessary steps to minimize the currency impact.

The growth initiatives undertaken in last two years and continued focus thereon during the year should start yielding results from this year onwards. These initiatives together with some other initiatives should show us in a different light in years to come.

The expansion of our facilities is in progress to allow us to increase our throughput to meet our projected volumes. We are also in the process of finalizing a separate facility for concrete equipments to provide for future needs.

While we expect to increase our sales substantially, the growth in profitability will be less than pro rata because exports will yield hardly any spares and concrete equipment will contribute at lower rate, being the first year of full range introduction.

Associate Companies:

Your company made two strategic investments during the year.

Monarch Chemicals Private Ltd.
company engaged in specialty chemicals and your Company acquired a 26% stake therein.
Monarch has carried out substantial expansion as well as consolidation of its capacities at asingle location. Further capital expenditure is entailed to add capacities by installing add on equipments and to add facilities for other products. The part benefit of expansion has resulted in more than doubling the sales during the year. (THIS MAY COME TO PUBLIC NEXT YEAR)
Potential Service Consultants Private Limited, Bangalore is an Engineering Design services company, providing total engineering solutions to building / Construction sector.

Your company has acquired a 40% stake in the company and has agreed to acquire another 11% stake on pre- determined basis by July 2009. The company is largely Bangalore centric with some operations in Hyderabad and Chennai. It recorded a substantial jump in sales of 61 % and the profit growth was impressive.
We expect both the above companies to record robust growth.
These investments are in the nature of permanent investments. Your companys philosophy is to partner for life and help the original promoters grow the business to a different level. Both shareholders agreements provide for certain management control rights. We have accordingly consolidated the results.
Business Outlook and Prospects for FY 2007-08
We expect the coal mining sector and construction sector to continue to grow at an accelerated pace to meet the growing infrastructure needs. India is seen as a cost-effective source for many overseas buyers and with improvement in Indian quality standards, overseas buyers are willing to work in partnership with Indian companies. Your company is exploring various opportunities for improving its global reach. Your company is contemplating to enter into collaboration arrangements with overseas companies for new products in the field of construction and mining.
The financial year 2007-08 is a year of consolidation which should reflect the results of efforts made in the recent past. Risks and Concerns:
Macro economic and industry outlook are encouraging. However inflationary pressures, power shortages and political uncertainties can change the situation substantially. Cost increases in raw materials, transport costs, infrastructure deficiencies like lack of roads, power, availability of shipping space in time, currency effect are some of our major concerns


BUY THIS STOCK ON EVERY DECLINE BY 2010 THIS WILL BE 5000 rs STOCK.

STOCK RESISTANCE AND SUPPORT LEVELS
1150-1206-1367-1456-1518-1670-1916-2068-2191.50-2295-2315-2489-2700-3357-4400-
5045.63

(ALWAYS WATCH Consolidated Results FOR THIS COMPANY)

CAUSION:-DONOT EXPECT ANY BONUS AND SPLIT FROM THIS COMPANY

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