When Kenneth Andrade of IDFC MF shows interest in a stock, you can be sure that good things will happen sooner or later. In the case of Ricoh India, Kenneth’s timing was simply masterful. The stock was in the absolute dumps owing to the fiasco over its abortive delisting attempt. Punters, who had cornered huge chunks of the stock in the hope of making a quick buck from the delisting, meekly handed over their stocks to Kenneth Andrade at a throwaway price.
Ramesh Damani went a step further. Having bought a chunk of the stock, he proclaimed the fact to the World and recommended that everyone else also join him.
Sushil Finance also demonstrated brilliant analytical ability. It recommended a buy of Ricoh on the basis that the stock is “growing by leaps and bounds” and is “cheap”.
I diligently reported all events in my pieces “Why Are Stock Wizards Ramesh Damani & Kenneth Andrade Bullish About Ricoh India?” and “Not Too Late To Join Stock Wizards Ramesh Damani & Kenneth Andrade Into Ricoh India”.
I also suggested that it would be naïve for us to not grab the stock when the savvy investors are doing so.
Well, today, all plans came to fruition because Ricoh India reported blockbuster Q3FY15 results. The income from operations surged 80% to Rs 409 crore from Rs 227 crore in Q3FY14. Also, as against a loss of Rs. 0.2 crore in Q3FY14, Ricoh reported a handsome profit of Rs 10.55 crore for Q3FY15.
| Ricoh India’s Quarterly Performance | |||
|---|---|---|---|
| Particulars (Rs cr) | Dec 2014 | Dec 2013 | %Chg |
| Net Sales | 409.39 | 226.79 | 80.52 |
| Other Income | 1.2 | 0.49 | 144.9 |
| Total Income | 410.6 | 227.28 | 80.66 |
| Total Expenses | 375.07 | 210.27 | 78.38 |
| Operating Profit | 35.52 | 17.01 | 108.82 |
| Net Profit | 10.55 | -0.21 | 5123.81 |
| Equity Capital | 39.77 | 39.77 | – |
Understandably, there was great excitement in the air and the stock went surging up to its upper circuit of 20% to rest at Rs. 344. In just the last six months, the stock is up nearly 100%.
Ricoh’s top brass, Manoj Kumar, CFO, was quite gung-ho about the Company’s prospects. He explained that IT service is a very fast growing market and that there are several projects that Ricoh has got into. He pointed out that Ricoh is also an active player in the field of executing government government-to-citizen (G2C) projects. It is also a very important player in executing certain high value commercial projects. He expressed confidence that with the government very seriously pursuing the agenda of financial inclusion, digitisation and automation, the IT services market is growing and Ricoh would be able to capture a very large pie.
So, it does look like Ramesh Damani and Kenneth Andrade (and their vast legion of devoted followers) have more riches in store for them from Ricoh India.
This is indeed a very good pick. The way the company is growing it can get to Rs.1000 in couple of years. Good pick.