Dear Friends
I come across few companies which have good market presence and brand value. But if you see their Market cap they looks extremely under valued. There may be hidden reasons for the discount given by Mr.Market. I feel its worth to discuss these companies and reasons for their under value.
My list is
1. Provogue – Mcap 60 Crs
2. Country Club – Mcap 180 Crs
I urge valuepickrs to come with other such stocks and discuss the reasons here.
I thought it is good to put the BSE link directly as there are many opinions flying around on the price bands:
http://www.bseindia.com/markets/MarketInfo/DispNewNoticesCirculars.aspx?page=20150806-24
This link should provide the BSE notification.
An IMPORTANT point to note is the below line taken from the above NOTICE:
“In the event of any corporate action, the respective price of the security shall be adjusted as per the prescribed process.“
So, the price will NOT be capped but adjusted accordingly depending on any corporate action, if any.
I think as a part of the above process, price was capped on Friday and lower circuit changed to 10%. However, I believe Cupid will move back to its usual circuit limits +/- 20%.
Now, the important point is, there is no need to give UNDUE importance to these price bands – which are anyway applicable to many other stocks and are not in our control anyway – when you have enough conviction on the long term potential of the company. Cupid most likely will have multiple positive triggers like order wins, new product announcement (Lubricant Jelly) etc.
So, let us move back to fundamental discussion on the business!
Thanks Dhwanil for BQ insights/investment note.
one thing i want to bring to notice is that during weak economy, advertisers move towards radio because of low cost and to focus on local/target customers.
Below is from AR 13.
” It is a well known fact that FM radio fares well when the economic times are bad. There are two major reasons for this. First, clients who have been bred on a diet of TV and Print are forced to re-evaluate their media mix when advertising budgets come under pressure. A re-evaluation brings to the fore, radio’s core strengths, often not well known to clients. Radio’s reach for example is far higher than print’s. Radio’s pricing is far more reasonable than both print’s and TV’s. It is this combination of high reach and affordable pricing that makes radio so attractive as an advertising medium, especially during periods of economic slowdown.
Second, clients tend to shift focus from nationwide pure brand-building to more tactical, local, sales-generating “promotional” activities. Radio, being a local medium and being the last one consumed before a brand purchase, is ideal for such activities. Both these factors have contributed to FM radio’s fast growth in FY’13.
Woww.. Nice work.. thanks
Your intent may be good but the wordings reflects wrong message. Please correct the same in future and oblidge. No harsh feelings.
Manish..
Your point is noted..
Vijay18, There is a thin line between the technical/statistical details and the price targets. The idea of the stringent rules of the forum is meant to protect the novice investors from getting carried away. Hope you understand the same.
Abhishek, The deleted post reads “from here on we may expect it to double by end Sept.2016” is what is objectionable. May be his wordings are not right. He has given similar price targets in other thread also.
i agree with zidane .. divi have just mentioned the price bands where it can move.
there should flexibility in this forum for expression of views , ideas , technical or statistical details.
Hi Donald,
Thanks for your words of appreciation. I look forward to a strong critique/counterpoints to my arguments to take a more balanced view. I think you have focused on two very important points that can have large impact on the business.
On Phase III- Phase III auction is to be conducted in two batches. Batch 1 consisted of largely metros, category A and B cities (i.e. larger ones) while the Batch 2 will consisted of category C & D town. Thus, Batch 1 effectively symbolizes larges advertising markets while Batch 2 will mean smaller markets but wide reach. The current status is Batch 1 auctions are over and results are out. In batch 1, 3-4 players have adopted different approaches/strategies in bidding. ENIL seemed to have focused on strategy where they have worked with two objectives
1) To gain second frequency in most of it’s existing market
2) Expanding the reach in key areas of north & north-east
So, the key points to focus for us
– How well ENIL be able to capitalize on second frequency especially when other players in those markets may have idle inventory (we need to understand inventory position of other players/competitors in those markets and then understand the ability of ENIL to fill up it’s inventory for second frequency either through differentiated strategy or through brand pull
– What will be the benefit to ENIL due to increased reach in northern and north-eastern region
On the regulatory environment
Here are the documents- Citywise_Migration_Fee_PhaseII_to_Phase_III.pdf (340.0 KB)First Batch_PhaseIII FM Auction Result.pdf (357.0 KB)Phase_II_Guidelines.pdf (181.9 KB)Phase III_Guidelines.pdf (520.8 KB)Phase III Auction_NIT.pdf (1.6 MB)
In addition, I am also uploading detailed investment note on ENIL that I have prepared which may give some perspective on industry/regulatory structure
ENIL_Investment_Note_03_11.docx (94.6 KB)
Hope this is helpful.