I cant understand what else this could be called – it was an inexpensive commodity producer when I bought it at 32-33 coming out of a CDR. nothing more – there are 200 mills doing the same stuff in india itself and like buffet says even if the management is extra ordinary, they are only gooing to be fighting to keep plugging new holes that emerge in the boat.
As for target price, I follow einhorn’s philosophy to take it as you go along – why should one commit to an exit at the time of entry – that’s like entering into a marriage thinking if I have two fights, i will file for divorce. I personally don’t do it that way. Re-assess facts and the risk-reward ratio – said all of this, i am sure that Q2 results will be optically very good and I will take a call based on the price then.
At this point of time, I am worried about the cash flow discipline in the business – nothing more, nothing less. I will watch the BS in sept to see how it goes and take a call – No pre conceived notions, no commitments – flow with the facts.
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