10000 to 4crs in 18 months 1000rs to 50crs 300% returns 75% promoter holdings A 50 bagger A sureshot 5 bagger Analysis Another fraud? Auto ancillaries Bank sector Blind sell Brand plays Broking Bse Nse Buy calls cements Ceramics/tiles Counters I don't like Debt free businesses Delisting candidates demerger bets Disclosure- I own them Domestic consumption plays E-Commerce pick Education Exit at rallies Famous analysts Famous stocks FMCG Footwear future multibaggers Gems andJewellery Hidden gems High conviction ideas High dividend plays High potential small caps High ROE stocks Holding companies Hotel sector How they looted you.. Indian stock market Infrastructure sector Interesting Microcaps IT KPO Landbank plays largecap ideas Less than 5 PE stocks Liquor Logistics Market lessons Market outlook for 2013 and 2014 Market underperformers Meeting with the CEO Metals Monopoly businesses My 5 baggers My Favourite counters My paid stock recommendations My stock picking techniques nse bse tips Oil exploration Operator calls Paints Penny stock outlook penny stock updates Pharma sector Poultry stocks PSU Publicity freaks Real estate Renewable energy plays Safe bets Sell recommendations Share market Live shipping stocks short term call SOTP plays stock tips stock under 10rs Stocks to watch out for Strong bonus candidates Takeover candidates TATA product tea Textiles The 13 bagger The 45 bagger Trading companies Transformers Turnaround bets Tyres Uncertain/Risky business models Unique businesses

Search This Blog(Over 800 companies covered in the blog).

Archives : Old artciles

Saturday, October 31, 2009

Kothari Products Ltd:Future growth outlook and prospects,buy/hold or sell?

Scripscan:Kothari Products Ltd

Story:Kothari Products manufactures pan masala under the brand name of Pan Parag, which has now become a generic name for pan masala. This company has got an excellent distribution network and this product is sold through lakhs of pan shops located all across the country. What we like about this company is the strong balance sheet of the company and its cash flows. If you take a closer look at the balance sheet of the company – this company has an equity capital of about Rs 6.63 crore. Promoters hold roughly 75% of the equity capital. This company has investments to the tune of about Rs 375 crores as on march,2009 balance sheet.This company also has a cash and bank balance of Rs 42 crore and they have loan side advances of close to Rs 116 crore.This makes the total liquid assets available with the company at more than Rs 530 crore. Against the liquid assets of Rs 533 crore, this company is totally debt free. This company is going at a market cap of just about Rs 200 crore. I am not even including the valuation of the business, which over the years has been responsible for creation of such huge assets. Even if you take the valuation of the business, I am sure it will be a few 100 crore.This company has been a regular dividend payer, for the last 15 years it has consistently paid dividends of more than 50% going even upto 160% in some years. Here we have a company, which is a debt free company, which has got a small equity, very high promoters stake.Now in spite of the fact, that this is a business, which has always been looked at with suspicion and perceived to be on the declined because of health factors and social reasons, the company has been adding about Rs 100 every year to the shareholders’ kitty for the last few years.Here you have a company, which is trading at substantial discount to the liquid assets available with the company. It is creating huge value for the shareholders, whereas the market price is not going up even by the amount of cash which the company is generating every year for its shareholders. At the current price of about Rs 295-300, this stock is a pure value play.

Important Disclaimer&Privacy policy

This blog does not share personal information with third parties nor do we store any information about your visit to this blog other than to analyze and optimize your content and reading experience through the use of cookies.You can turn off the use of cookies at anytime by changing your specific browser settings.This privacy policy is subject to change without notice and was last updated on 20.3.2013. If you have any questions, feel free to contact me directly here: Investment in equity shares has its own risks.Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that I consider reliable. I,however,do not vouch for the accuracy or the completeness thereof.This material is for personal information and am not responsible for any loss incurred based upon it & take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations above.The stock price projections shown are not necessarily indicative of future price performance.The information herein, together with all estimates and forecasts, can change without notice.

Subscription to Arunthestocksguru

Enter your email address:

Delivered by FeedBurner