CP touches 350.Seems post AGM it has caught the attention of investors and analysts.Also the warrant issuance overhang gone.Stock is getting rerated.
How big is the opp size?only 600 crore as mentioned in BT or could it grow to more?
Posts tagged Value Pickr
Hitesh portfolio (28-09-2015)
What are your thoughts on KSCL at this price? We had two bad monsoons in a row, and next one is predicted to be bad, which adds to the market's dis-illusionment on KSCL. Adding to it, the uncertainty around how the monsanto relationship is going to play out, has kept the stock cheap, at 10x earnings now. (Though some level of aggressiveness in E of the PE).
I know you used to own the stock, and sold at a 20x. How do you feel now?
P. I. Industries Ltd. – A Unique Business Model can make it a Great Play on Agri & CSM Space (28-09-2015)
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HIL – Eco (onomic) friendly way to play rural prosperity in India (28-09-2015)
HIL has been quite an enigma for me - company delivers decent results but no one seems to care because of the asbestos overhang. I cut my exposure at about 680 and hold a smaller quantity not because I do not believe in the business but because of my conviction that the valuation gap will never get corrected as institutions stay away from this stock because of the asbestos overhang.
on PVC, at theri scale, I see no reason - infact, CFO told me last year they did about Rs. 35 Cr. and this year they will do Rs. 70 Cr. or so without too much effort.
discl : invested but trimming.
Garware Wallropes (28-09-2015)
Few questions from AR
I am tracking the company for a while now... A consistent performer in a niche area of product with huge possibility in the expansion of Synthetic Cordage market.
However, while going through the Annual report in detail, I came across few issues, which unless clearly understood, is difficult to build a conviction in spite of perceived quality of management being good.
Enclosed is an excel file (with 4 years' numbers) which I prepared after finding few numbers which need better clarity.... Here are crux of my observations...
1) There is a Revenue booking of Rs. 12 Cr. to 15 Cr. (appx) each year during last four years under “Efforts made for construction contracts” ---- Unable to understand what it actually means?
2) Garware change accounting figures of previous years on subsequent years in many instances…… Some instances are mentioned in the worksheet. What may be the reason for such frequent changes?
3) Other Provisions / Other Payables figure are increasing at much higher rate than sales or profit….. Check excel…. Any specific reason for the change? Like, some change in business practises etc? If so, need to understand.
4) Forex exposure Liability has increased substantially over the years (check excel) …. We need to understand the nature and reason for this. Garware blended (domestic + exports) receivable days are less than 90 days and net forex exposure is about Rs. 268 cr. It is to be noted that, Rupee also didn’t show much volatility during the accounting period of 2014 – 2015. We are unclear about the reason for having such large and increasing forex hedge liability.How will Garware liquidate the liability. If the receivable days are less than 90 then there should be constant circulation of forex exposure .... How can it increase so much? Also, they didn't have any large Capital Goods import pending.
5) Non-elucidated (No narration given in AR) Short Term loan and Advances has gone up at 38% CAGR between 2012 – 2015 ---- What may be the reason?
I tried to seek clarification from management through few mail / phone but unable to elicit any response.
GARWARE 040915.xlsx (13.2 KB)
Granules India Ltd (28-09-2015)
So here's the potential business impact of the recent Ibuprofen FDA approval
Indian terrain—play on consumption (28-09-2015)
Definitely, it does. Thank you so much.
Ambika Cotton Mills (28-09-2015)
thanks for sharing your meeting notes.
My richdreamz portfolio – visit my portfolio to learn together! (28-09-2015)
I have initiated position in MPS and I have written about it in the MPS thread - link provided below.
MPS Ltd (28-09-2015)
I have initiated a position in MPS after having done a bit of research for the past 1 month on the publishing industry and reading through this informative thread thrice over.
Firstly, congrats for the members for identifying this turnaround during initial stages itself. There are very high chances of this turnaround further fructifying into growth story coupled with high return ratios of the business.
My summary:
Nishith Arora has fantastic business acumen, going by his MPS buy out, turning it around, other small acquisitions. A la Piramal. At the current stage the company is in, his eye for making that inorganic growth happen is crucial.
I liked the new structure now, Nishith concentrates on strategic acquisitions (for inorganic revenue growth) while his son Rahul on day to day operations (for organic revenue growth). Rahul has even moved to US to be closer to clients which should enable his objective.
At the current price, the stock is lower than the price paid by Goldman Sachs, HDFC Bank at the beginning of the year (836 INR whereabouts) - super timing with the stake sale and still promoters hold 68% (I like it).
Fair amount of re-rating is YET to come given the very high ROCE, Free Cash Flow, dividend yield, opportunity to grow within a slow growing industry (things would change I believe once publishing becomes easier with digitisation). I do believe that publishing industry is at cross roads. DIGITISATION is the way to go and the vendors will immensely benefit due to this. MPS is on the right side of it.
The risk reward ratio at the current price seems skewed towards reward disproportionately and is one of the major reasons for me getting into this stock.
We are at initial stages of this story and if organic growth even if it comes to 10-15% secularly and inorganic growth comes through 1 or more high ROCE and 1.x times sales, we are headed for stars. When this thread was started the story was in its Infancy.
Ethical promoters, excellent education background, entrepreneur family (Vandana Luthra of VLCC is Nisihth's sister).
Risk here - Improper utilisation of raised capital, key client risks.
MPS looks like "Hawkins characteristics PLUS growth oriented promoters PLUS mini Piramals". An explosive combination to have.
As stated earlier, I'm invested, so my positive rant could be due to this bias. So, do your own due diligence before any action on this stock and this is not an investment advice.