Shri Ashtavinayaka Cine Vision

1.  Two greatest hits of the year - Golmaal 3 and Dabaang - come from this distributor. Dabaang was real big. What happens- A stock runs up from 9 to 40. And then suddenly it drops to 8 with 3 crores pending sell order still. Many retail investors hav eburnt their fingers. what is the reason? Why..

2.     If you see the insider trading in the company you will be shocked. Maximum trading is by an entity Dahlia traders. further search indicates that , the propreiter of this agency is Dhillin Mehta, the CMD of SACV. Why would the owner of a company doing well want to dump / buy his stock at such regular interval> is he running the company or playing the market

3.  In 2007, the company issued FCCB at a conversion price of 8.9 per share. Obviously, when the stock was at 40, these holders would prefer to convert to equity. A total of 130 crores shares were then issued. And dont forget, a magnanimous bonus was announced in the middle. I stopped doing calculation seeing the number of zeroes that would bloat up the equity on conversion and obviously, this would affect the EPS and the CMP would adjust to the PE of the sector. Is it any wonder that the stock today is a falling knife.. Where it finds support is any ones guess. So like their movie.... Run Bhola Run.. keep away for some time

Navin Flourine

Navin Flourine was recommended a few days ago at around 270 Rs by email to all subscribers. The rationale behind the pick was an excellent management (Mafatlal), a dividend yield of 5 % , a market price less than book value, and most importantly a buy back offer - not from open market , but by tendering of shares at Rs 400. This is a gem because here is a management extremely open to offer shareholders immense value. I had mentioned in the e mail that in spite of the record date being over, this company is a value buy. the management was themselves not tendering shares because they believe the company is worth much more. So for those who picked it, enjoy the ride. the stock is up by more than 10% in less than 02 weeks. this was based on pure fundamentals and management perception. A good management is worth 40% value when calculating the 05 parameters to analyse the stock.

Mid Size IT company posed for growth

1.  One of the greatest challenges for a good investor is to identify a company  , which stands out among its peers . There are many companies in the IT mid cap space which offer value - Sonata, Patni, Helios and matheson, 3i Infotech, but the one that appeals the most to me - Zensar Infotech and Sonata . Why Zensar - because of its scalability. The growth has been consistent over the last few quarters except a minor blip in Mar 2010. It has consistently rewarded shareholders- div yield is app  3% + , bonus and most importantly zero debt (which is very critical part of the analysis) &  last but definitely not the least, it  belongs to the Goenka group who have expressed their  intention of increasing their stake too. For me Zensar and Sonata are two good companies that stand out in the pack. Mid cap IT will find it difficult to scale up, and are likely to be good takeover / M&A candidates which could send their shares rising with time . But with the Goenka group, this may not be the issue as the promoters are keen to increase the size / scale up.  Excellent Management with Ganesh Natrajan at the helm. Another good reason to buy

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Icome Statement
Revenue	146.59	138.64	120.43	123.23	128.91	502.32
Other Income	0.37	5.42	0.46	0.60	1.21	2.91
Total Income	146.96	144.06	120.89	123.83	130.12	505.23
Expenditure	-121.59	-105.81	-103.47	-93.57	-97.37	-393.18
Interest	-0.08	-0.05	-0.07	-0.11	-0.28	-0.55
PBDT	25.29	38.20	17.35	30.15	32.47	111.50
Depreciation	-6.50	-6.45	-6.19	-5.65	-5.85	-24.92
PBT	18.79	31.75	11.16	24.50	26.62	86.58
Tax	-1.15	-2.96	-1.60	0.34	1.12	-2.43
Net Profit	17.64	28.79	9.56	24.84	27.74	84.15
Equity	43.25	21.59	21.58	23.98	23.97	21.58
EPS	4.08	6.67	4.31	10.36	11.57	35.77
CEPS	5.58	16.32	7.30	12.71	14.01	50.54
OPM %	17.31	27.59	14.46	24.56	25.41	22.31
NPM %	12.03	20.77	7.94	20.16	21.52	16.7

Investment Lesson - The lesson from the first investment

My first investment was during the IT bubble of late 90s. Little did I know, what a balance sheet, a cash flow statement or "P&L" statement stood for. Was a young man who wanted to be a part of the fast league - a par of the India shining group. That is when I applied for the IPO of a company called Helios and Matheson Info Tech. I track it even today- maybe a hangover or the first love effect.The company made its maiden IPO in Oct 1999 at a price of Rs 50. I picked 100 shares. So in say, Jan 2000, I had invested Rs 5000 in this company. The company issued bonuses 02 times in the ratio of 1:1 each time i.e.  I have 400 shares today at approximately Rs 40 CMP. So the worth of the stock is approx 16K. The dividends announced by the company in the last five years have been 15/15/35/15/15 which totals to approx Rs 3000. So effectively , if I sell it today i.e  after 10 years, my Profits are 14K which translates into a CAGR of approximately 13%. The company CAGR from 2004-2008 grew @revenues 47% and PAT @ 24%. . A 13 % return is good when my PF gives me about 8% (More than 50% as compared to my PPF). Today , the stock is still swinging between 36 - 40. Is it still a value buy- it is indeed, but there are better picks out there. 


So the lesson is " Slow and Steady wins the race- There is no substitute to patience. The Ben Graham fundamentals still hold good". 

SJVN Analysis (CMP 22)

SJVN - PAST TO PRESENT
The SJVN Ltd (formerly Nathpa Jhakri Power Corporation Limited - NJPC ) was incorporated on May 24, 1988 as a joint venture of the Government of India ( GOI ) and the Government of Himachal Pradesh (GOHP) to plan, investigate, organize, execute, operate and maintain Hydro-electric power projects. The present authorized share capital of SJVN is Rs 7000 crores.The Nathpa Jhakri Hydro – Electric Power Station– NJHPS ( 1500 MW ) was the first project undertaken by SJVN for execution.
	2006	2007	%	2008	%	2009	%	2010	%	REMARKS
EQUITY	4108	4108		4108		4108		4108		Post IPO equity is app 4300
SALES	1062	1409	33	1356	-4	1760	30	1769	1	Consistently increasing sales
PROFIT	585	649	11	764	18	1015	33	972	-4	Consistent growth in profits
DIV	4	5.7		5.94		7.8		7.95		Dividend yield at presnt market price is around 2.6%
EPS	1.42	1.58	11	1.74	10	2.46	41	2.35	-4
BOOK VAL	11.88	12.8	8	13.85	8	14.72	6	16.15	10	Consistently increasing book values
OBSERVATIONS AND CONCLUSIONS
It has a fairly good ROIC at greater than 15%. In another 02 years we will see capacity additions.
Its available at a market cap of 9000 crores against say Torrent power  at 12000 power or GVK at app 7000 crores.
Company was listed last year . Gave a dividend of 55 paise.
Half yearly EPS is 1.48 . With the monsoons being good we can expect it to touch 2.50 by year end