A lot of positives have been captured already in this thread, so I do not want to repeat them here.
But I am skeptical of the promoter quality. Performance of both Taneja Aerospace and ISMT has been poor. There was this aircraft accident in 2020 after which they shut down the business, and there was a bird hit earlier in FY17. This reflects poorly on the management. Accounting quality also needs to be scrutinized closely. When the aircraft accident took place in FY20, the losses were shown as Exceptional Item in the P & L, but when insurance claim was received, it was accounted as Other Income:
This inflates the PBT for FY21. More importantly this amount has not been deducted from PBT while calculating the CFO and so the CFO also stands inflated to that extent. Meanwhile, the aircraft continues to appear in the Gross Block under Right of Use Asset even today. I am not fully sure how this accounting works; but something doesn’t seem right here.
Salil Taneja has maxed out his remuneration at 10 % of PAT already which seems too high too early. I am also curious why a software company (Taal Tech) with a Gross Block of Rs.8 crores has Rs.1.42 crore of vehicles in it.
(Disc: Tracking, no positions)
Subscribe To Our Free Newsletter |