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Fairfield Atlas Ltd. Stock Analysis

Small Cap
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Fairfield was founded as an offshoot of Ross Gear and Tool Company by David Ross to manufacture differential gears for the early automotive industry.Fairfield Manufacturing Company offers a broad range of gear and drive solutions including gearing, custom designed gear assemblies, and the...

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Value Creation
 Mar'10Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19
Return on Capital Employed 11.73%19.64%30.13%21.18%29.16%15.04%11.55%11.77%10.28%15.91%
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 89.3164251229360407368406519618
Y-o-Y Gr. Rt.-83.8%53.2%-8.8%57.1%13%-9.5%10.3%27.9%19%
Adjusted EPS (Rs.) 3.446.411.441018.1111.49.7311.0110.9219.46
Y-o-Y Gr. Rt.-86.1%78.8%-12.6%81.1%-37.1%-14.7%13.2%-0.8%78.2%
Book Value per Share (Rs.) 13.7720.2231.5742.0561.0375.8487.39100.03112.4132.43
Adjusted Net Profit 9.417.531.327.349.531.126.630.129.853.2
Net Op. Cash Flow (Rs. Cr.) -0.718.225.640.326.459.245.818.973.848.2
Debt to Cash Flow from Ops -68.712.231.570.91.220.420000
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Fairfield Atlas Ltd. should be analysed on a Standalone basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales 24%11.4%18.8%19%
Adjusted EPS 21.2%1.5%26%78.2%
Book Value per Share 28.616.814.917.8
Share Price -12.4% -38.6% -55.7% -91.3%
Key Financial Parameter
Performance Ratio Colour Code Guide
 Mar'10Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19
Return on Equity (%) 31.2937.6644.1827.1735.1316.6511.9211.7510.2815.89
Operating Profit Margin (%) 8.6116.0821.6122.7724.3415.6916.0914.7811.8817.74
Net Profit Margin (%) 10.5410.6612.4311.9113.737.657.217.415.758.6
Debt to Equity 1.340.730.470.320.190.120000
Working Capital Days 215156151189147158176187180169
Cash Conversion Cycle 90645670606761503852
Entity Percentage Holding
Promoters 98.19%
Institutions 0.05%
Non-Institutions 1.76%
Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)
Data is not available for this company.

The 5-year analysis of Fairfield Atlas's performance infers:

Fairfield Atlas earnings have grown by 1.5%, whereas share price has depreciated -38.6% CAGR over the past five years, indicating the company's share price is likely undervalued. However, for specific investment actions please connect with your investment advisor.

We analysed the performance of Fairfield Atlas share prices over the last 10 years. Here is what we found out:

Fairfield Atlas share price has depreciated -10.9% annually over the past ten years.

Fairfield was founded as an offshoot of Ross Gear and Tool Company by David Ross to manufacture differential gears for the early automotive industry.

Fairfield Manufacturing Company offers a broad range of gear and drive solutions including gearing, custom designed gear assemblies, and the industry renowned Torque Hub® planetary drives.

As part of the Oerlikon Drive Systems business segment, along with Oerlikon Graziano, their product
Fairfield was founded as an offshoot of Ross Gear and Tool Company by David Ross to manufacture differential gears for the early automotive industry.

Fairfield Manufacturing Company offers a broad range of gear and drive solutions including gearing, custom designed gear assemblies, and the industry renowned Torque Hub® planetary drives.

As part of the Oerlikon Drive Systems business segment, along with Oerlikon Graziano, their product portfolio also includes drive solutions such as axles, transmissions, and specialty gearbox assemblies for a wide range of applications.

Now in it's 86th year, Fairfield Manufacturing Co. is one of the world's largest independent producers of custom gears and gear products and power transmission components. Along with its custom gear work, the company builds a range of Torque -Hub branded products and accessories for wheel, shaft output, spindle and swing drive applications.
  • Capabilities from our 175,000 square foot facility in Belgaum, India include: 
  • Internal and External Spur and Helical gears 
  • Internal Spline and Splined / Spur Shafts 
  • Gear Shaving
  • Grinding 
  • Miscellaneous O.D and I.D Machining, Turning, and Grinding
  • Complete, Precision Inspection Capabilities
  • In – house heat treating 
  • Complete assembly and painting capabilities
Fairfield recently introduced their new line of High-Torque Jack-Up drives at the May 2009 Offshore Technology Conference, held at Reliant Park in Houston, TX.

Fairfield’s complete line of Torque-Hub® jacking drive products are designed and developed to meet the specialized needs and requirements of rugged marine applications with maximum jacking torque ratings from 700,000 in-lbs to over 20,000,000 in-lbs.

Special features offered include customized input configurations, output pinion gears, and specific ratios suited to the specific applications. Fairfield Torque-Hub® jacking drives feature ABS and DNV certifications and include high quality, precision gear components to insure smooth jacking, high reliability and outstanding performance in the most demanding applications.

Product range of the company includes:

The company offers Gear and drive solutions-
  • Custom Gears -The most extensive range gear manufacturing capability available. From one inch to over 60 inches, Fairfield has the ability to engineer the perfect gear to service your need.
  • Custom Assemblies -From 3000 Nm to over 4 million Nm of output torque capability, Fairfield has the expertise to meet the most demanding drive system requirements.
  • Torque Lock -A full line of spring –applied / pressure released brake products with real holding power.
  • Torque Hub -Torque-Hub® final drives deliver the torque output and long-life performance required for industrial machinery and off-highway mobile equipment.

Milestones:

1919 
Fairfield founded as an offshoot of Ross Gear and Tool Company by David Ross to manufacture differential gears for the early automotive industry.

1920-30s 
Fairfield expands from a small gear shop to a highly regarded producer of all types of gears in the gear industry. Customers included Oliver Tractor Company, John Deere, and Clark Equipment Company.

1940s 
Fairfield makes significant contributions to the war effort during WWII. Fairfield Awarded the Army-Navy Production Award for outstanding accomplishment in the production of war materials.

1952 
Moved into new modern facility on US 52, becoming North America’s Leader in the production of custom gear products. The company experienced several expansions throughout this decade. Developed and refined induction hardening process for gear teeth.

1960s 
Decade of innovation and invention. Fairfield developed self-locking differentials to improve traction of mobile machinery, as well as innovative types of gearing to adapt to market needs.

1972 
Fairfield purchased the planetary final drive product, Torque-Hub® expanding the company’s market offerings. During this decade the last surviving Ross family owner passed away, Eleanor Ross Baird, and the company is sold to Rexnord a manufacturer of transmission, aerospace, and specialty components.

1987 
Rexnord sells Fairfield to NEOAX Corporation

1989 
As part of a restructuring and realignment process, NEOAX sells Fairfield to Lancer Industries.

1990 
A line of compact track and wheel drives with hydraulic motors, were developed in a joint development agreement with Sauer-Sundstrand.

2000 
Fairfield acquired Atlas Gear in India. The newly formed Fairfield Atlas Limited, expands from 75,000 square feet to over 170,000 square feet and adds the manufacture, assembly, and painting of complete gear assemblies to the company’s capabilities.  
2006 
Purchased by Saurer AG, the world’s leading textile machinery manufacturer. As part of this acquisition Fairfield joins the Graziano Trasmissioni Group, expanding the companies footprint and capabilities throughout the world.


Achievements/ recognition:
  • Fairfield has received two distinct certifications covering their gear components and drive products used in the global off – shore / marine platform and jacking drives industries. 
  • The company received DNV’s MSA certification qualifying Fairfield’s gear components for use in all DNV certified jacking systems, planetary and custom drive assemblies. 
  • Fairfield has also received product certification from DNV for one of their most recently developed jacking drive assemblies in their line of S2000 Series Jack - Up Drives. Fairfield offers a complete range of jacking drives systems and products covering maximum jacking torque capabilities from 732,000 in- lbs. to over 20,000,000 in-lbs. 
  • DNV is one of the world's leading certification bodies/registrars offering the latest in management systems certification services, helping to manage risk, and helping customers safely and responsibly improve their business performance. 
  • Fairfield Manufacturing Company, Inc. is a global leader in the design, development, and manufacture of gear and drive system solutions for the off- shore marine and energy industry as well as specialty industrial and off – highway mobile machinery. 
  • Fairfield is part of the Drive Systems business segment of the Oerlikon Corporation AG, Pfäffikon, Switzerland. The Oerlikon Corporation operates in 180 locations worldwide on five continents and focuses on a variety of high technology markets in Europe, Asia and the U.S.
  • ISO/TS - 16949 Certified.

Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323
Research Analyst - INH000000719

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