Government policies envisage that Indian industry should be pollution free and it is more relevant with the pharma related company which are responsible to help maintain the health standards. In such like scenario, those company related to manufacturing pollution control equipment play a crucial role.
Thermax is one such companies which has the market capital of around 10000 crore and is one of the established company. Suffering from marginally higher price to earning when compared with other players, it has the book value of around 190 with dividend payout of 350% against face value of Rs.2/- (a defensive stock). Increasing reserves, sales and net profits, it profit generating efficiency level is 22%. It being a debt free company with debt equity ratio of only 0.23, it enjoys the CRR of 79%. With good management, Thermax makes a sound investment at each correction. Looking forward and giving another quarter or so (should the market be in comfortable zone), stock is worth 925 (+).
As a term investor one should keep a close watch on this stock.