Results for the quarter – with profits at Rs.45 cr (compared to 60 cr earlier) given the very low container rates – are very good and much better than I expected. If this level of earnings sustains for the next 3-4 years (bottom of the cycle) , the company deserves to trade at a higher multiple. Even a multiple of 5 on low earnings of Rs.180 cr per year means the stock should be valued at least 1.5 to 2 times the current valuation. The peak cycle earnings are of course much higher.
Disc : Invested and Added after results
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