13,632 units were sold during the fourth quarter of 1998-99 as compared to 12,182 units in the third quarter, 10,514 units in the second quarter and 12,008 units in the first quarter. For the full year, the company recorded a 19.56 per cent growth in volumes, which is impressive compared to the industry growth of less than 3 per cent. The company has managed to grab the number two position (18.4 per cent marketshare) from Escorts Tractors. In fact, it is Punjab Tractors that has helped the sector to record a positive growth. The overall growth for the rest of the sector has been almost nil during 1998-99.

In terms of value, sales for the fourth quarter were at Rs 269.67 crore. Not only have sales been higher, thecompany has also managed to maintain its profit margins. OPM during the fourth quarter remained at 18.94 per cent, marginally lower compared to 19.10, but significantly higher compared to 17.69 per cent during the second quarter and 17.31 per cent during the first quarter. With talk of a revival in demand in the air, future outlook for Punjab Tactors is positive. Being one of the major low cost producers and having an excellent hold on the western markets, the company posseses the ability to perform consistently better than the industry. In fact, the company is gearing up to take the full advantage of a change in the demand trend. The company will be completing its capex by September this year that will take the capacity to 60,000 units.

As for the stock, while the long-term outlook remains positive, all the positive developments have been factored in in the current price, and a sharp appreciation from the current level is unlikely in the short-term. But for those who are looking for a long terminvestment, Punjab Tractors is still an attractive bet.

Aurobindo Pharma: Pleasant surprise

Aurobindo Pharma's financial performance for the quarter ending March has come as a pleasant surprise. Sales at Rs 167 crore were substantially higher compared to Rs 135.18 crore for the quarter ending December 1998. On the margins front too, performance has been impressive. OPM for the fourth quarter stood at 15.71 per cent up from 14.98 per cent during the third quarter. During the second and the third quarters, OPM was at 11.2 per cent and 13.1 per cent, respectively. Lower raw material prices, a focus on value addition and rising exports have helped the company achieve higher marings.

For the full year, while total revenue were up by 86.25 per cent to Rs 550.03 crore, at Rs 213.46 crore exports recorded an impressive jump of 127 per cent per cent. The future outlook for the company continues to be bright. Completion of the cephalosporin unit should further provide a boost to turnover the next year.The company is shifting its focus from oral drugs to steriles which will have a positive impact on the margins.

As far as the stock market is concerned, the stock is on an upswing. At the current price, the stock gets a price multiple of nearly 10, which is expected to go up if the company manages to maintain the uptrend in profit margins. Although the last 18 months performance is unlikely to be repeated, the stock is expected to overperform the market. The stock has appreciated by more than five times in the past 18 months. Technically speaking, the stock has good support at Rs 410, whereas on the upper side, it will face a minor resistance at Rs 620 which is an all time high.