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Posts in category Value Pickr

Waterbase – Can it be Next Avanti Feeds? (11-12-2015)

One more innovative step:-

The Waterbase Ltd, a leading manufacturer of high quality shrimp feed, has launched 'Bay White Enriched', a new generation shrimp feed formulated with essential nutrients required for producing healthy shrimps.

Bay White Enriched is a mixture of highly digestible marine and vegetable proteins matching the ideal protein specification for the Vannamei shrimp. The product contains natural sources of phospholipids, cholesterol and omega-3 fatty acids to fulfil the shrimp’s requirements for essential lipids.

Given the growth in shrimp exports which accounted for 67 per cent of the marine export revenues, good farming practices coupled with availability of quality seed and feed would help the industry to increase shrimp production.

The company’s major focus is to develop shrimp feeds that are high on nutrition and are anti-biotic free, Ramakanth V Akula, CEO, The Waterbase Ltd, said in a release.

Bay White Enriched is available in all the Waterbase dealer outlets across the country.

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Torrent Pharma Ltd (10-12-2015)

I had done a similar exercise for Ajanta Pharma using the formula: (1 - g/ROCE)/(WACC - g). In my opinion, Torrent Pharma has significant potential of re-rating as ROCE recovers and actual growth beats market implied rate.
Results are displayed in table below. The market is currently implying a growth rate of 10.6% (PE of 13.8)

Note: ROCE has ranged historically from 25-30% but was a low 19.4% in FY15 (source: moneycontrol)

WACC picked up from but increased based on own judgement (paper mentions 11.6%): http://shodhganga.inflibnet.ac.in/bitstream/10603/20482/11/11_%20chapter%205.pdf

Disclosure: Invested

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Ajanta Pharma (10-12-2015)

Using the formula: (1 - g/ROCE)/(WACC - g) from Valuation by McKinsey (page 66), I tried to find out a reasonable PE for Ajanta. Results are displayed in table below. Seems a lot depends on long term growth rate which the market is currently implying at 16% (PE of 32)

WACC picked up from http://www.gurufocus.com/term/wacc/NSE:AJANTPHARM/Weighted%2BAverage%2BCost%2BOf%2BCapital%2B%2528WACC%2529/Ajanta%2BPharma%2BLtd

Disclosure: Invested. Forms a significant part of portfolio

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Monte Carlo Fashions Ltd – Branded Apparel Stock at Good Valuation (10-12-2015)

Hi I am holding Nahar Spinning for more than 2 decades but small quantity.The performance over the period is inconsistent or not constant.Above all, the promoters of all the 3 Oswal group companies are against the interest of the minority share holders.
1 Bindal agro oswal agro etc.
2 Vardhaman spinning, Varthaman Acrilic etc.
3.Nahar Spinnig,Nahar Capital,Monte Carlo, etc.
That is why all the Oswal Group companies shares except Monte Carlo are quoting very low P.E
Dis. Not invested/interested..

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Vinati Organics (10-12-2015)

Yes Vivek, that cannot be ruled out as @kkarunakar has pointed out...but if you see the Fund holding i posted earlier..Mirea asset has added good qty last month while HSBC continues to hold similar qty as they were holding in Mar'15 AR....both funds now holds close to 1% each...but not getting reported as it has been parked in two or more funds...

i also checked FCCB conversion thing...they raised USD 5mn from IFC in 2011 which got fully converted last year...issued sm 22l shares to IFC at conversion price of Rs 100/sh in Sep'14..and in subsequent qtrs dec-mar..ifc exited fully making 4-5x of conversion price...

now only concern and question is rampup of ATBS - as pointed out by @gagandeep_nanda - crude price correction impacted ATBS sales and its impact on topline growth....margins were held up nicely in 1st half which is smwhat heartening....with crude price likely to remain subdued...rampup of ATBS gets delayed impacting topline growth in medium term...

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Vinati Organics (10-12-2015)

Perfect Chintan. Thanks for the quick research.

But still logically isn't it possible that SBI or any other mutual fund might be willing to sell shares from one of the fund or part of any other fund. This is just a possibility. I think signalling to market of undervaluation might be another strong motive though.

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Vinati Organics (10-12-2015)

Hi Vivek....you are right when you see only SBI Magnum Global Fund holding in isolation which is getting reflected under Public >1%..but other SBI Funds togather holds 21.9l shares in Vinati...if you go through their FY15 annual report, there are 5 SBI funds mentioned in top 10 shareholding...as of March, reported SBI MF holding was around 21.4l shares..hope this clrafies the doubt

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Vinati Organics (10-12-2015)

I think there is something wrong with this data (But I remember SBI taking stake from Jwalamukhi which was actually c.4%).....please see below from BSE (above 1% holding). Clearly SBI is the only one with more than 1% and it is holding 9.9 lac shares. Will still check with other sources and confirm by tomorrow.

http://www.bseindia.com/corporates/shpperent.aspx?scripcd=524200&qtrid=87&CompName=VINATI%20ORGANICS%20LTD%20&QtrName=September%202015

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Monte Carlo Fashions Ltd – Branded Apparel Stock at Good Valuation (10-12-2015)

The company is putting TV commercials. But the commercial has no appeal. All the participants read actor/actresses are girls but all of them were non-Indian. I could not understand who were their target audience. Their TV commercial work is really lousy and proves @Mayank_7772 point that it is one of their businesses.

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Monte Carlo Fashions Ltd – Branded Apparel Stock at Good Valuation (10-12-2015)

I would request you to at least do some research before asking questions. I have raised an idea here and hope for inputs, not an interrogation and one way flow of information.

To answer your question, June quarter there was an adjustment that led to sales being booked for September quarter. The Company indicated the profit for September would be higher on this account and this was correct.

March quarter the revenue dipped due to change in the way sales are booked.

@Mayank_7772 - I will be PMing you.

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