This small cap stock makes devices for power transmission. Seasonally, Q1 is always the weakest while Q4 is the best and this is exactly what is reflected in the company’s current Q1FY14 performance. YoY, the numbers are good but due to the seasonal factor, sequential performance is down. YoY, thanks to the 7% rise in topline at Rs.5.54 crore and a reduction in operating costs and substantial rise in other income, the company ended the quarter with a net profit at Rs.93 lakh, up by a whopping 90%.

The company’s equity base is pretty small at Rs.4.93 crore and it’s a debt free company. Its biggest risk is from dependence on aluminium which is its main raw material amongst many. Too much spike up in the price of the metal could topple the cart but in current Q1, it got the advantage of the lower prices. The company caters mainly to sectors like steel, infra, cement, power. Orders come when these sectors do well, expand and modernize. As long as they do well, so will the company. There is no FII holding or any major institutional holding in the company.