Discussion in 'Ask A Query About Your Stock Picks And Portfolio' started by saurabh.dwivedi, May 3, 2015.
Plz provide your views about Moil at current levels.
be as sarcastic as you can be
Govt has approved 10% stake sale of Moil according to news. So better wait and watch till clarity emerges on the sale price.
Moil's core production is on the rise. Also, the valuations are pretty cheap (like most PSU's) for long term investment it looks good. Though it can test patience in the short term.
Happy investing !!
Well, from one perspective, the stock is attractive. It is quoting at low valuations (near the 52 week low) and an attractive dividend yield. It has a pile of cash on the books. It is also the lowest cost producer of manganese ore in the World. Even a slight uptick in demand could benefit the stock.
So, the "margin of safety" in the stock is high.
The downside is that it is a commodity stock and does not enjoy secular growth. It is a PSU and has no pricing power.
Any investment decision has to necessarily be taken by comparing the prospects of one stock for another. Within the private sector space, there are several stocks which are quoting at reasonable valuations. In the Pharma space, for instance, JB Chem is quoting at a P/E of close to 10 or so on a forward earnings basis. It also has a pile of cash on its books. The Pharma sector is on a secular growth path. Likewise, in the housing finance space, there are stocks like DHFL and India Bulls Housing that are at reasonable valuations. These also offer a degree of "margin of safety".
So, the question to be asked is: Is there any trigger to MOIL which will enable it to outperform other stocks over the next three or five years? If not, then one is better off staying with secular growth and non-PSU stocks.
I bought JB chemical when it was quoting below 100 for its cash reserves but i dont have much idea about pharma space so i dont know how much growth will be there for JB chemical in future or for other pharma companies.
Similarly as a rule i avoid financial stocks like banks and NBFC.
Reasons for buying Moil are following:
1)A recent report by the Indian Bureau of Mines projects manganese ore demand in 2020-21 to be over 9 mt and estimates local production at 5 mt. MOIL, being the leader in the segment, is set to benefit from this growth.
2)the company plans to double its output to 2 mt by 2020-21. It expects to produce 1.5 mt annually by 2016-17 by expanding its existing mines. MOIL has received licences to prospect around 600 hectares (11 blocks) near its existing mines in Maharashtra, to open around four new mines.
It is good that you are investing as per a game plan. The decision to avoid Pharma and Bank stocks is not unusual. A number of knowledgeable investors follow the same rule. MOIL is a good company. If you have studied the stock in detail and have the conviction, you should go ahead. Ultimately, one can pick holes in almost any investment idea. What is essential is the conviction to stay the course.
Thanks meenakshi for your guidance
Seeing its past record we can say that moil will earn money but how much it rewards its shareholders remains to be seen :-\
MOIL Ltd is a good company to invest for long term.
EQAXScore is 96.Confidence Rating is 95.Turnover Rating is 76.SHP Rating is 100.All is Good.
Price Rating is 56 out of 100.
The Price Rating is a measure of how expensive a stock is with respect to its quality.
But overall good stock.
MOIL will be clearly beneficial
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