POKARNA LTD

SMART BUY IN BEAR MARKET

The Pokarna Group, which started with granite business back in 1991, now has interests in granites, garments and engineered stones.

1.GRANITE:-

Pokarna Limited is one of the largest exporters of natural stone from India dealing in over 85 premium colors and exporting more than 45,000 Sqmt. every month to the most reputed companies all over the world. We have our own quarries in the most sought after colors like Black Galaxy, Absolute Black, Tan Brown, Sapphire Blue, Coffee Brown, Seaweed Green, Silver Pearl, Pokarna Green, Vizag Blue and Flash Blue. Besides Indian stones, we also process several colors from Saudi Arabia, Iran, Norway & Ukraine.

2.READY MADE GARMENTS:-

The Andhra Pradesh-based Pokarna Ltd, manufacturer of the `Stanza' branded men's premium apparels.

Having positioned itself as the premium branded apparel player, Stanza has recently widened its garment offerings - formal, casual, fashion and luxury.

The apparel brand uses 100 per cent cotton and blends mostly with linen for its product range. Its price is in the Rs 1,000-4,000 range with average pricing at Rs 1,500.

Stanza, which is working on doubling its earnings from the Rs 25 crore (during 2006-07) to Rs 50 crore for the 2007-08, has recently introduced marketing of `Stanza' fabrics imported from Italy

Pokarna's apparel factory, located in the Apparel Export Park in Ranga Reddy district in Andhra Pradesh, has recently increased its garment production capacity and produces 3,500 shirts and 500 trousers a day.

Fashion biggie Hugo Boss step up sourcing from India

Hugo Boss is reportedly considering a foray into India’s apparel
sourcing industry and has had discussions with several suppliers, including Hyderabad-based Pokarna Fashions.

TIE UP WITH HUGO BOSS may announce shortly.

3.engineered stone:-

consumers keen to have the choicest colour shade for their apartment flooring or large companies looking for uniform colour stones for their premises could have an option ready.

At present, granite, a common choice, has a limitation in colour and quantity. ‘Engineered Stone’, which is set to roll out, perhaps for the first time in the country from Pokarna, can be customised to the client’s preference.

The designer stone in demand in Europe, Australia and the US is based on the technology patented by the Italian company — Bretton. The Hyderabad-based Pokarna Ltd has signed a 10-year exclusivity agreement with the Italian company.

There are about 40 manufacturing plants based on the Italian technology globally. In Asia, Vietnam and Korea have such units. The engineered stone is stronger than granite, scratch-proof and non-porous.

Pokarna Ltd has invested Rs 180 crore in a manufacturing facility for the designer stone in the Atchutapuram special economic zone in Visakhapatnam, according to Mr Gautam Chand Jain, Chairman and Managing Director.

Production is expected to begin in May. The work is in full swing at the facility spread over 40 acres. The 100 per cent imported machinery from Italy has the capacity to manufacture 2,000 sq.m per day of the designer stone.

The company has plans to add three more manufacturing lines, each of 2,000 sq.m/day capacity, with investment of Rs 150 crore, after assessing the market demands

FOREIGN CURRENCY CONVERTIBLE BONDS

in March, 2007 issued and allotted Zero Coupon Foreign Currency Convertible Bonds ("FCCBs") with a maturity of 5 years and one day. The FCCBs were issued in the principal amount off US $ 12,000,000 (Twelve Million) and are convertible into ordinary shares of the Company at an initial conversion price of Rs. 295.64 per share. The conversion price of the FCCBs may be adjusted in certain circumstances. Unless previously redeemed or converted or purchased and cancelled, the FCCBs would mature at 144.50 per cent of their principal amount in U.S. dollars on 29 March 2012. The said issue was made at 32% premium to the reference date price. The FCCBs are listed on Singapore Stock Exchange. Up to March 31, 2007, none of the bonds have been converted into equity shares.

The issue proceeds are earmarked for the development of new projects and the modernisation or expansion of existing plants; and for such purposes as may be permitted from time to time under applicable laws.

currently it is trading at 82 rs.it has a book value of 136rs.and paying 15% dividend (last 4years paid 35%) .company's trail production is going to start in Oct ending. 2010 new plat turnover could be 200Cr .and profit margin between 15-18 %. company is getting loss because of textile division after tie up with hugo boss changes fortune of pokarna.

engineered stone will improve financials of pokarna.

i am expecting year 2010 company's turnover could be300-350cr and net profit at around 30cr

it has an equity of 6.2Cr 2010 earnings could be 50rs (if tie up with hugo boss )

currently it is trading at 7 p.e .after getting 50e.p.s it will be 350rs.

take a position at current price wait for one year .u will get minimum of 2-4 times return .

after tie up announcement it will jump minimum 40% in two days . so take a chance .

down ward risk may be 10-15rs.only.