Salzer manufactures Load Break Switches, Wiring Ducts, Terminal Connectors, Selector Switches, Ammeter Switches, Voltmeter Switches, DC Disconnectors, Electro Magnetic Relays and Magnetic Wires besides Modular Wiring Accessories and Allied Specialty Products.

With international approval and innovative designs the company's market share for these products is continuously growing.

The company has also entered into collaboration with M/s. Plitron Manufacturing Inc., Canada(Leading Manufacturing of Transformers in North America), in 1995 for manufacturing Toroidal Transformers with 50% Buy-Back.

The Prestigious ISO 9001 Certification by NQA-UK has been obtained for Design, Development, Manufacture and Supply of CAM Operated Rotary Switches, Selector Switches and Allied Products. The company has a strong R&D facility with the full-fledged laboratory and captive tool room to upgrade & develop products setting with new market trends. Its In-house R&D has been recognized by Ministry of Science and Technology, Department of Science and Industrial Research, Government of India.

Today, it is market leader in India for Rotary Switches, PV Application Switches & PVC Wiring Ducts (channels) and provides complete customized electrical solutions.

The company has five manufacturing facilities.

The company has one patent for its rotary switch and five products are awaiting patent.

March 2016 quarter results

For the quarter ended March 2016, sales grew 28% to Rs 98.84 crore. OPM fell 260 basis points to 9.8% which saw OP rise just 1% to Rs 9.66 crore.

Other income grew 436% to Rs 1.93 crore and interest cost went down 2% to Rs 3.16 crore. As depreciation jumped 49% to Rs 2.16 crore, PBT grew 19% to Rs 6.27 crore.

As tax grew 24% to Rs 2.35 crore, PAT went up 17% to Rs 3.92 crore.

FY 2016 results

For FY 2016, sales grew 27% to Rs 361.13 crore. OPM fell 60 basis points to 11.9% which saw OP rise 21% to Rs 42.89 crore.

Other income grew 180% to Rs 2.80 crore and interest cost went up 6% to Rs 13.14 crore. As depreciation rose 16% to Rs 8.32 crore, PBT grew 43% to Rs 24.24 crore.

After providing for taxation, (up 44% to Rs 7.20 crore), PAT went up 42% to Rs 17.040 crore.

Enjoys strong positioning

The company is established player in the switch gear industry for the manufacture of CAM Operated Rotary Switches with Latest technology at international standards mainly for industrial purpose and has the facilities of taking the multiple outputs as well as sequence with various programs in all capacities from 6 Amps to 400 Amps.

The company's products are well received in the International and Local Markets and all leading OEMs including public sector undertaking are using standardized Salzer switches.

The company is progressing well and is now planning to improve the quality further to superior standards to expand the export markets.

M/s. Salzer Controls Ltd, one of the group companies, was merged with Salzer Electronics Ltd to further strengthen its hold in the global markets and also to have size economy, cost reduction, better utilization of human resource and its manufacturing facilities, etc, to achieve the cost effectiveness.

The company has continuously been securing its leadership position in the following segment:

• Market Leader in Rotary Switches business with 40% market share, and largest producer in Asia.
• Largest producer of Cable Ducts (Wiring Channels) in Asia.
• Largest Exporter of Load break switches from India.
• Approved supplier for Nuclear Power Corporation for Rotary Switches.
• Largest Supplier to Indian Railways.
• Selected as a preferred vendor for GE - Energy.

By 2020 the company plans to achieve sales of Rs 1000 crore

By 2020 the company plans to achieve sales of Rs 1000 crore. New products will drive growth. With new products the company hopes to grow 20% each year and double sales in 5 years. It hopes to add Rs 250 crore by way of contribution from new products.

The management feels that sales can grow 25% in FY 2017 with 50 basis points improvement in OPM.

Sales from TLT can contribute to Rs 6 crore in FY 2017 and this is going to be continuing business.

With a gradual revival in the domestic capital expenditure (capex) cycle in the key industries and an improvement in the project spending, sustained growth can be expected going forward.

Other details

During FY 2016 the company issued 3359450 equity shares out of which 2641000 shares were to QIB under Qualified Institution Placement, 298450 shares to employees of the company and 420000 shares on conversion of quail number of warrants by the holders.

The board has declared dividend of 16% (Rs 1.60) for FY 2016.

Valuation

The share price trades at Rs 204.