Shri Keshav Cements & Infra Ltd (Formerly Katwa Udyog Ltd) – Capacity Expansion Play on Cement
Shree Keshav Cements & Infrastructure Ltd (formerly Katwa Udyog Ltd)
Shri Keshav Cement & Infra. Ltd. (KCIL) (Formerly KATWA UDYOG LIMITED) is Public limited Company incorporated in the year 1993 to manufacture 43 grade and 53 grade Ordinary Portland Cement. The company raised capital via IPO during 1995.
The inception of the company began with acquisition of a sick cement plant of 20 TPD (Tons per day) in 1994. The capacity of the plant was gradually increased year after year to reach 600 TPD. The acquisition of cement plant of Shri Quality Cements Ltd, Lokapur had added 300 TPD to the existing capacity. The company is undertaking an expansion project to increase the output to 3000 TPD which is one million tonnes per annum.
Structure of the Group
|Keshav Cements & Infra Ltd (KCIL)||Current Capacity||Future Capacity Plans|
|Kaladagi plant||Acquisition from Sangam Cements from KSFC||200 tpd ie. 0.07mio tonnes per annum|| FY 18 capacity – 0.27 mio tonnes per annum
|Lokapur plant||Acquisition Shri Quality Cement Ltd form IDBI||150 tpd i.e. 0.05mio tonnes per annum|
|Katwa Finlease Ltd||Part of promoter group||Hire purchase of automobiles|
|Katwa Infotech Ltd||Part of the promoter group||Software services in Healthcare, manufacturing and BPO operations|
|Katwa Construction Ltd||Part of the promoter group – plans to merge with KCIL (flagship company)||Construction of luxurious flats for NRIs|
|Katwa Oil Ltd||Part of promoter group||Under liquidation|
|Katwa Finance & Investment Ltd||Part of promoter group||Not much information available publicly|
|Katwa Inc||Overseas subsidiary of Katwa Infotech||Medical transcription and other services in the US|
Grade – Grade 43 & Grade 53 Ordinary Portland cement
Brands – Jyoti Power, Jyoti Gold
Markets – Maharashtra, Karnataka, Goa
Reasonable compared to standards in the industry.
- Vilas Katwa (MD) – Rs 50,000 pm
- Deepak Katwa (Director – CFO) – Rs 25,000 pm
Shareholding of the promoters
Promoters’ shareholding is comfortable with 2/3rds of the equity being held by them.
Related Party Transaction
- Loans from Promoters – o/s as on 31.03.2015 is INR 11.27 crs
- Interest paid on such loans is ~ 10% p.a. which is as per market standards
Cash Flow Analysis
|Narration (Rs Crs)||Mar-12||Mar-13||Mar-14||Mar-15||Mar-16||Mar-17|
|Cash from Operating Activity||5.72||4.67||7.66||7.77||14.46||1.29|
|Cash from Investing Activity||-4.42||-4.40||-4.17||-1.25||-8.44||-32.66|
|Cash from Financing Activity||-1.47||0.37||-4.15||-6.49||-6.22||37.04|
|Net Cash Flow||-0.17||0.64||-0.66||0.03||-0.20||5.69|
- Company is consistently generating cash from operations over years which is being used to repay debt and invest in plant & machinery (capex)
- 2017 has been a watershed year for the company with a huge capex expense of INR 32 crs. The company took a term loan of approx. INR 35 crs for the same as we see in the balance sheet.
- Essentially the company has been expanding thru internal accruals except for a major expansion which was undertaken in FY 17
|Narration (Rs Crs)||Mar-12||Mar-13||Mar-14||Mar-15||Mar-16||Mar-17||Total|
|Net profit after Tax (PAT)||1.23||1.76||1.62||2.91||4.22||0.73||12.47|
|Cash from Operating activity||5.72||4.67||7.66||7.77||14.46||1.29||41.57|