Hanung Toys and Textiles Ltd. (HTTL) : Buy.

HTTL is a manufacturer and exporter of soft toys and home furnishings to European countries and US.

1. Best technical knowhow - was set up in collaboration with a South Korean co. Hanung Industrial Co. Ltd.
2. Presence in Europe and US and other developed countries.
3. Cost focus strategy- Most competitively priced in the niche market of Soft Toys and children's furnishings.
4. Self designed 4000 designs driven by market and trends.
5. End to end integrated-
6. Play-n-Pets and Muskan brands in Stuffed Toys:Over 100 distributors across India, for stuffed toys. Including multi brands outlets like shoppers Stop.Over 70% of the organized soft toys market share . Local market growing rapidly.
7. Splash in furnishings available in 600 stores across India
8. International markets - About 85-90% of company revenues come from Exports. USA - 5 stores, One each on Germany, Italy, Poland, Portugal and 2 in UK and Sweden and One in Latin America, Chile
9. Leading manufacturer and exporter of Soft Toys. License holder of the Walt disney characters in India
10. One of the leading manufacturer and exporter of home furnishings.Pioneers in Shape cushions- revolution in domestic and foreign markets
11. Manufacturing Facilities- IPO proceeds used to set up manufacturing facility in Utaranchal over a 25 acre land and an investment of 150 Crores to be operational in early 2007. Has 2 units in Noida. One for each LOB. The third will be to make cushions and quilts and bedsheets etc.

The stock had underperformed the market over the last one-month to 24 September 2007, rising 16.23% compared to the Sensex's return of 16.78%. It had also underperformed the market rising 7.19% compared to Sensex's rise of 16.17% in the past one quarter.

The current price of Rs 136 discounts its Q1 June 2007 annualized EPS of Rs 14.75 by a PE multiple of 9.2.

Signed export order tie-up with a leading US buyer, for exporting home furnishing to the extent of US $ 50 million to be completed by December 2009. This agreement will bring greater strength and better revenue to the company. The order is to be completed by December 2009. The company has so far signed long-term export contracts worth $265 million, the company said.

HTTL’s net profit rose 93.5% to Rs 9.29 crore on 55.7% growth in net sales to Rs 85.20 crore in Q1 June 2007 over Q1 June 2006.

Refer to the following charts to get real time stock price trend. At the time of this report, the stock was trading at 136. BUY with a target of 300.

YOU CAN BUY THE REST OF THE COMPLETE EQUITY RESEARCH REPORT ON THIS COMPANY. MAIL ME FOR THE TABLE OF CONTENT OF THIS REPORT mohan.late@gmail.com