Scripscan:Sundram Fasteners Ltd
BSE code:500403
cmp:58
Story:The company is among the leading producers of high tensile fasteners in the country. The product portfolio also encompasses products such as radiator caps, powder metal parts and cold extruded products.Sundram Fasteners caters to the original equipment requirement of auto majors. It also has a presence in the domestic replacement market. Over the years it has expanded its product as well as customer base. The company's focus on exports is also positive.Their can be pressure on profitability going forward owing to the steep rise in price of raw materials which can be instrumental in capping earnings growth.This however is likely to be offset by the growth in volume.With the domestic automobile industry growing at a healthy pace, Sundram Fasteners appears to be well positioned to grow at a healthy pace.The earnings growth would get a boost if the price of raw materials were to soften. Besides, the pressure on earnings would also ease if the company manages to successfully negotiate price revisions from its original equipment clientele.Taking into account these factors, long-term investors may include the company in their core portfolio at slight lower levels. Sundram Fasteners would rank as one of the superior picks from the auto ancillary sector.
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