DATE:04.01.

2010
VOLUME NO: 1/2010
ISSUE NO:39.

www.niftyiews.com
STOCK REPORT- A VIRGIN
Delete box, or
SUGAR
add logo, photo,
or other image
COMPANY.UNTRACKED AND
here. UNKNOWN.
SIR SHADI LAL ENTERPRISES LIMITED

• 11250 TCD SUGAR PLANT IN 2 LOCATIONS.

• 2 MW COGENARATION PLANT.

• 40 LAKH GALLONS IML DISTILLERY.

• MANAGEMENT HAS INCREASED SHAREHOLDING IN

LAST FEW QUARTERS USING CREEPING ACQUISITION.

• IT IS TRADING AT A DISCOUNT TO ITS REPLACEMENT

KEY STATS:- VALUE AT PAR WITH MOST SECOND RUNG SUGAR
• Code : 532879 MILLS IN UTTAR PRADESH.
• Market cap : 761mln
Peter Lynch had once famously said he likes companies with
• FY09 BV : 137.47
peculiar names. Sir Shadi Lal enterprises limited is one such
• Total Debt :2402 mln
company. The company is a North India based sugar company
• CMP :145 and is one of the oldest companies in the region with an operating
capacity of 11250 Tcd.

TEAM
STOCKRESEARCHERS
Pvt. Ltd.
3 SUBHASHNAGAR CORNER,RAIYA ROAD,
RAJKOT, Gujarat, 360007
www.niftyviews.com
CONTACT:09327744250
CST NUMBER: AADCT0544JST001
HEADLINE
SSLEL, a company promoted by Sir Shadi Lal
in the year 1933 is a partially integrated sugar
manufacturer and is engaged in the production
of sugar and alcohol. It currently operates two
units, one located at Shamli Distt.
Muzaffarnagar,UP (6250 TCD (Tones
Crushed Per Day) and second unit located at
Unn, Distt. Muzaffarnagar (4,000 TCD-
Licensed). The Unn Unit was acquired by the
company in September 2007.
The company also has two distilleries (one at
Shamli and another at Pilkhani, District
Saharanpur) with combined capacities of 40
lakh gallons per annum. To integrate further
SSLEL has also installed Extra Neutral
Alcohol (ENA) plants and 1 MW bio-gas
based power plants at both the distilleries, in
H108.
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The 11250 Tcd plant is valued at 337 crs
based on replacement methodology. The
company also owns two distilleries of
combined capacity of 40 lakh gallons along
with a 1 Mw bio gas plant in each distillery.The
distillery,power plant along with the sugar plant
have a projected replacement value of more
then 400 crs. Since the company is a 77 years
old company historical valuations shouldn’t be
used as benchmark.
Bajaj hindustan with a number of its plants in
Northern Uttar pradesh and two plants in
Muzzafarnagar district is trading at a valuation
higher then replacement value. Over a period
of time these valuations would converge.
The company acquired the assets of Monnet
sugar in 2007 by purchasing its 4000 tcd sugar
plant for an undisclosed amount. Since the
purchase was during the slump of the sugar
Cycle the company has tremendously
benefitted from the acqusition.

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The company can benefit tremendously from
the current bull run in sugar peices.Refer the
sugar analysis on www.Niftyviews.com dated
04.01.10.
The promoters of the company have used
the creeping acquisition route to raise there
stake by 0.62% in last four quarters.
The stock can be held in the long term
portfolio for sustainable gains.
HIDDEN VALUE
When one closely scrutinizes the
companies accounts one can observe the fact
that the company is virtually debt free.
Investors can question the fact that
the company owes long term and short term
debt of 2402 mnl rupees. Most of the debt has
been used to maintain a sugar inventory of
2200 million rupees. If one adjusts the
quarterly profits of last two quarters the
company is now almost debt free.
The evidence of the above view can also be
concluded from the fact that the company has
made a net interest payment of 38 million as
compared with 56 million (QoQ) and 68 million
(YoY). This translates to a saving in Eps of 6
rs per share per quarter on an Yoy basis.

Investors should note that the company in

March 2009, carried an inventory of more then
983708 quintals of sugar at an average cost of
19.02 per kg.

MANDATORY DISCLOSURES:
This document is for information only and is meant for the use of the Recipient & not for circulation.
The information contained in this document has been taken from publicly available information trade
and statistical services & other sources. While the information contained herein is from sources believed to be
reliable, we do not hold ourselves responsible for its Completeness and
accuracy. All opinions and estimates included in this report constitute our judgment as of this date and are
Subject to change without notice. Investors are expected to use the information contained in this report at their
own risk. This report is not and should not be construed as an offer or the Solicitation of an offer to buy or sell any
securities. TEAM STOCKRESEARCHERS and its affiliates may act as market maker or have assumed an underwriting
position in the securities of companies discussed herein and may sell them to or buy them from
customers on a principal basis..
 Profit and Loss

You can view particular company's Income statement for a period of 5 years. SOURCE: TSR RESEARCH/ COMPANY
(Rs in Cr.)
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Income :
Operating Income 320.13 172.47 252.60 290.86 270.65

Expenses
Material Consumed 224.48 146.74 193.45 190.70 183.49
Manufacturing Expenses 15.92 14.94 12.62 21.12 15.41
Personnel Expenses 28.84 25.16 20.66 24.14 20.19
Selling Expenses 5.71 3.41 9.97 8.39 7.72
Adminstrative Expenses 5.97 6.50 5.53 4.90 4.34
Expenses Capitalised 0.00 0.00 0.00 0.00 0.00

Cost Of Sales 280.92 196.76 242.23 249.25 231.15

Operating Profit 39.22 -24.28 10.37 41.61 39.50

Other Recurring Income 1.95 4.16 1.76 1.37 1.05

Adjusted PBDIT 41.16 -20.13 12.13 42.98 40.55

Financial Expenses 25.03 17.80 4.19 3.43 4.70

Depreciation 16.44 11.80 4.83 4.23 4.04
Other Write offs 0.00 0.00 0.00 0.00 0.00

Adjusted PBT -0.31 -49.72 3.11 35.33 31.81

Tax Charges 5.25 -12.29 1.54 11.54 11.06

Adjusted PAT -5.57 -37.44 1.56 23.78 20.75

Non Recurring Items -0.15 0.29 -0.11 -0.23 -0.16
Other Non Cash adjustments 0.03 0.00 0.37 0.08 0.00

Reported Net Profit -5.69 -37.15 1.83 23.63 20.59

Earnigs Before Appropriation -5.69 -37.15 1.83 23.63 20.59