Return ratios are subdued because the company sold a large parcel of land and the cash is lying in the books. Also, compared to its size, the company has significant investments in Gujarat Borosil which has just turned the corner and should do well from here on.
The company has 2 main divisions. Based on March 2015 results, annual EBITDA/Capital employed for both of them are as follows
Scienteficware : 76%
Consumerware : 27%
Out of total capital employed of 697 cr , Borosil has made investments of 637cr ( out of which 485cr is cash or cash equivalent ). Net of these , the return ratios are through the roof.
The management seems to be aware of the investing communities fascination with return ratios, hence they are meeting to announce a buyback on 11th Sept 2015. If the buyback price is reasonably good, we should see shrinking of the balance sheet and all return ratios will climb.
disl : invested at cmp
mcap when posted : 727cr
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