I agree @jitenp. And thats exactly my point. Your price point was great, congrats for that but current price point to invest, in my view its quite high given the reasoning in my previous post.
Posts tagged Value Pickr
Hindistan Media Ventures Limted (HMVL): A mispriced bet in newspaper business (27-10-2015)
Hi Sunil,
As per the management commentary, the debt is for funding the working capital needs of the company. As they do not want to touch the long term investment that they have made in debt mutual funds, they are borrowing money to fund the same. Whether that is the the most optimal approach or not is debatable. However, personally I do not see that as much of material concern as the financing cost is quite less compared to overall profitability levels.
Indocount notes from AR (27-10-2015)
Management Interview on CNBC
Wockhardt – A story with twist and turn (27-10-2015)
Mr Khorakiwala today in interview with ET Now mentioned that Wockhardt's US business went down from $500M to $150M due to US FDA ban on Waluj and Chikhalthana plant. He also mentioned that Wockhardt has completed all the pending action items like responding to minor issues raised by US FDA during their plant visits. So now it is only question of time when they should receive approvals.
So this makes a perfect case of " Low Risk, High Uncertainty Business" as defined by acclaimed investor Mohnish Pabrai in his book "The Dhandho Investor"
I am adding more on every dip.
Please see the complete interview in the video in the attached link -
Disc - invested for more than one year and intend to hold for long term
Kitex Garments Limited (27-10-2015)
That sounds good. Is the call limited or could others take part - even in listening mode - as well? If yes, do share details.
Areas I might seek clarifications are
U.S sales : what kind of volumes and margins and by when? Implications of this on sales to existing clients. If not from client side at least from production constraints side.
TPP
What is their sense of when member countries will ratify and adopt it? What concrete steps is India taking for regional agreements to go around this? Any plans of acquisitions in Vietnam? How long does it take to ramp up capacity to plant optimal scale? Do they prefer greenfield route or acquisition route? Why? How will they respond to glut in India of yarn and fabric once yarn forward principle is applied?
What are growth plans in India? In terms of volumes, values, margins and time frames.
What are growth plans in Europe and Japan in terms of volumes, values, margins and timeframes.
How do they plan to build in house brand building capabilities?
Kitex Garments Limited (27-10-2015)
Hi Chirag,
Could you share the concall details please.
I wasn't able to find it on Kitex website or anyting on the web.
Thanks.
Hypothetical situation – Valuing unconsistent business (27-10-2015)
Below is given hypothetical situation.
Assume company ABC is having having FY15 profit of 100Cr, and the average P/E of industry in which business operates is 10 and current market cap is 1000Cr.
Given that you know and the company will have 10Cr profit in FY16, 200Cr in FY17, 10Cr in FY18 and 200Cr in FY19 and after that profit will be somewhere in range of 40-60 Cr for next 10 years which cannot be predicted exactly now but will be range bound.
How do someone value such business or on what earnings should multiple be applied? Most of the times market assign a value based on forward year earnings.
Now because each year earnings are so fluctuating what should be the base earnings which should be considered Current year? Next year? Average of 4 to 5 years?
Views please.
If this case study doesn't makes sense please flag the post so that it gets deleted.
Kitex Garments Limited (27-10-2015)
Hello guys,
There is a concall with the kitex management of Friday 30th October.
I have listed falling queries to raise before the management. If anybody has any more queries than please add to the list so that it get answered, and probably ends dilemma of fellow members for investment decisions.
- Why cash of 250 crores is lying idle ? ( Why not employed in some short term FMP's )
- Why there was no mention of merger with Kitex childrenwear?
- What could be the potential implication or threat by implementation of TPP ( Trans pacific partnership ) and how will company respond to it OR any plan B.
- Why topline is flat after 6 months? ( I know that majority sales takes place in Q3 and Q4 )
- Will be management be able to achieve the topline growth of 600 - 650 crores?
- Why Fabric contribution to the EBDITA is very less compared to the capital employed? ( 1 crore EBDITA compared to 73 crore capital employed ).
Your queries are most welcomed!!
Kitex Garments Limited (27-10-2015)
Every asset that has a cash flows will have an intrinsic value and from the intrinsic value you can compute intrinsic PE irrespective of small or mid or large cap.If value investing requires you to invest with a MoS,the prerequisite is you should know how to compute value first and then compare with price and take a call on buying or not. I just referenced PE for easy understanding and EPS just doesnt incrase 2 or 3 times just like that..What you cant measure yoi cant controls as stated by WB. If one dont know what the industry might look like then any number will fly and any value can be justified
Kitex Garments Limited (27-10-2015)
Dear Manish,
Technically it is relevant. But you are right fundamentally it is not relevant.