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Pennar Industries


Pennar Industries is in the business of manufacturing steel strips, metal profiles and related items.

It operates primarily in the railway (coach works) and auto segments.  It also has a presence in the white goods and pre-engineered buildings businesses.  It is attempting to shift focus to become an “engineering company” (which feeds off the steel strips business) with custom solutions and higher value product mix.  It is also exploring entry into the defence, nuclear engineering and aerospace segments. 

The company reported consistent growth in its revenues and operating profits over the last five years – reporting about 140cr of operating profits on about 1100cr of revenues. It operated with a conservative debt load.

It is primarily exposed to rising steel prices.  It is also exposed to the interest rate cycle – which has a follow-on impact on capital goods investments, infrastructure investments, auto purchases etc.   Moreover, government delays on rail infrastructure policies have a detrimental impact on the demand for the company’s products.  Further, it is facing increasing competition particularly in the railway business.

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