Scripscan:Suashish Diamonds Ltd
BSE code:526733
cmp:115
Story:We see that gems and jewellery are again in focus now. All the companies have been doing well. Apart from this company being a gem and jewellery player, it is a site holder for DTC as well. The performance for FY11 has not been bad. They posted an EPS of close to Rs 33 with a top-line of Rs 1100 crore. Comparing FY11 performance with FY10, they have been subdued.Their delisting move which the company initiated last year failed because if you go by the shareholding pattern, the promoters hold close to 89.5% and maybe, the mutual funds, NHIs and the close associates hold about 6% to 7%. The way we are approaching March 2013, which is a deadline for all the companies to go for the stake dilution to about 75%, I think there is going to be a second delisting move by the company that can see a huge value creation for the stock. If I go by the financials, I say Rs 33 EPS; it is a debt free company on a net basis. Apart from that, it has a book value close to Rs 320. If I take the expected EPS of about Rs 35-36 for FY12 the book value will rise to Rs 350. So it is ruling close to 0.3 or 0.35 of the book value and the PE multiple is less than four. Taking all this into consideration, I do not think there is any downside for the stock. However, once the delisting move is initiated, or once the stock comes in the limelight, I think the share can move to about Rs 200 in the next 12 to 18 months time.
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