Disclosure: i am not invested yet(i am just in the initial study phase) but have been watching Everest kanto with a lot of interest.
Today the price crashed by nearly 10 percent to 52 week low and it’s now available below book value. Considering results were around Feb 11th last year i won’t be surprised if this crash is something to do with that(Ie bad results expected/known soon). Considering the company has reduced interest costs , have tried to change their corporate image by starting concalls 2 years ago and paying a dividend (even if it’s just a 3 to 4 percent payout last 2 years) and with high roce… even with the macro reasons the current price doesn’t make sense(though the high in 2018 before the CG allegations was mid 70s and looks like some sort of support in its chart so maybe that’s where it’s headed). The pressure on bottom-line should last for a few quarters and the company isn’t at risk of going bankrupt before then but the market makes it look so. Is there something that’s happening that we don’t know about(apart from the beautifully explained macros/black swan regards cng above). Maybe something in the budget that affects it adversely… though if anything they spoke about reducing cng costs by reducing tax on biogas blended in it hence making it more viable which looked like a positive ? Even if the margins have crashed so badly that profits would be at single digits this quarter… but considering this will definitely improve over the next few years i fail to see why the beating has been so heavy(at current prices even their paltry 3 to 4 percent payout would be a nearly 1 percent dividend when the good times come back)
As mentioned above I’m not invested but it’s under my radar due to the obvious value(trap?) Here
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