Kunal, You can't compare this case with the names you mentioned unless they use that cashflow to reduce debt. After the debt reduces, the cash flow remains (and hopefully grows, if its a growing business)....Lets fast forward a bit.....Just assume, the 50cr cash is used to pay down down only. After about 3 years, what remains is a business valued at 170cr earning 50cr of cash with no debt, on a recurring basis....If future business remains debt funded, or the debt increases further - this may not hold true....Which means we need to re-analyse the business model and figure why they need so much debt (not making it a good business to be in).....
I am not saying 15% was on a lower base....15% was before the acquisition
With regards to the balance sheet, the numbers mentioned are not present on the snapshot you have provided. Please see moneycontrol.com or any other website which has separate sections for overall debt, working capital and cash....You will find the trends over there....Please include FY15 numbers too....For example debt has reduced from 180cr to 139cr
Posts tagged Value Pickr
Orient Bell Limited (14-10-2015)
Orient Bell Limited (14-10-2015)
akshay cant understand approach of taking operating cash flow to value business with debt. in this way all GMR , GVK, Lanco , Relaince Power and JP would be invesment candidate in 2011-12 . when a business is debt funded, cost of fund must be considered as normal expense.
- my case was business growth was less than 20% which u say was 15% on lower base and when business environment was more conducive now we cant extrapolate same rate in future
- i am posting here balance sheet (screener.in snapshot), cant find anything extraordinary. Debt reduction from fy12 is from 188 cr. to 165 cr. that is not so great when u have no rise in net block which was 233 cr. in fy12 and it is 223 cr. debtor days have been steady at 45 days since last 3 -4 years .
Finally do you have any projections of sales growth and EBIDTA and PAT . would like to see your expectations.
Styrolution ABS – MNC due for rerating (14-10-2015)
Data: Screener.in
OPM (TTM) = 7.74%
RoCE last year = 12.89%
RoCE 3 yr Avg. = 15.91%
RoCE 5 yr Avg. = 21.64%
RoCE 10 yr Avg. = 22.61%
As of today, a pedestrian OPM with a falling RoCE does not inspire confidence.
Eicher Motors (14-10-2015)
Eicher Motors: Royal Enfield's volumes are expected to improve 55% y-o-y in Q2FY16 (Motilal Oswal via IndiaNotes.com)
Highlights:
With continued higher demand momentum, Royal Enfield’s volumes are expected to improve 55% YoY (19.6% QoQ) and margins are expected to remain strong at 27% (+200bp YoY).
We expect VECV’s volumes to grow ~19% YoY (decline 3% QoQ) on economic revival and higher fleet operator utilization, leading to replacement demand. VECV margins are expected to improve by 110bp QoQ to 8% on account of operating leverage benefits.
We anticipate ~36% YoY (6% QoQ) growth in consolidated revenue. Consolidated margins are expected to be 16.2%, up 280bp YoY (240bp QoQ). Consolidated PAT (after minority) would increase 61% YoY (~20% QoQ) to INR2.6b.
The stock trades at 52.7x CY15E and 29.9x CY16E EPS. Maintain Buy.
Key issues to watch for
- Update on demand and waiting period for Royal Enfield.
- New launches and timelines under Royal Enfield business.
- Update on current CV demand trends, discount levels and channel inventory.
Virat Crane Industries Limited (VCIL) – sure shot multibagger (14-10-2015)
But now this company has started commanding a respectable pe ie 18 more than many other promoters ..So should we wait to get the run up somewhat exhausted ??
Disc - wanted to invest after due research
Nd also why the screener is showing roe and roce different when the company is debt free .
Styrolution ABS – MNC due for rerating (14-10-2015)
No comments anyone ?
BTW, stock is up 10% today...hopefully someone bought.
Disc : Invested
Virat Crane Industries Limited (VCIL) – sure shot multibagger (14-10-2015)
Last year Milk prices were high sir, as stated by promoter in current AR. instead of that they have increased APATM% from 3% to 8.5%...excellent....
Virat Crane Industries Limited (VCIL) – sure shot multibagger (14-10-2015)
Valuable discusion.VCIL is visible brand n looks set to be bigger.I don`t have much knowledge of it though....thinking to invest in it,so your information is valuable for me,thanks.
Syngene International IPO – Views invited (14-10-2015)
Your technicals are pure logic. I have seen similar post of yours on PI Ind thread. This is not encouraged at valuepickr.
Cafe Coffee Day – Will you Date? (14-10-2015)
The 17 institutional investors who bought shares a day before the IPO opened include global assets management giant Blackrock, Government Pension Fund Global, ICICI Prudential Mutual Fund, Reliance Life Insurance, Merrill Lynch, Swiss Finance Corp, Axis MF, Faering Capital India Evolving Fund, Jupiter India Fund, Platinum Asia Fund and Tarra Fund, a release from the company said
look at this,,,, Bennett, Coleman & Co. Ltd and/or its subsidiaries hold 0.80% of the equity capital of Coffee Day Enterprises Limited, as on the date of filing of the DRHP with Sebi.