Valued readers have sent these questions in past 2-3 days. Pls see the questions and our responses:
Question: It would be great if you could kindly share your views on PVR, it has risen sharply post Cinemax Deal. almost 44% up in 3-4 days.
PVR will now command a great presence in movie screening business & producers will have to strike deals with PVR promoters to ensure good collections , Also TV Analysts have started giving BUY calls saying the combined EPS is calculated to be around 25-30 Rs in 1 year taking price to above 400-500 per share.
I am holding PVR shares at 188 Rs , looking forward to increase my holdings.
Though it may reach 400-500 in a year ..is it possible that it may come down in short term because the current rise has been very very steep(44% in 4 Days) & only on speculations of future earnings ? or is it possible that it will continue rising like wockhardt upto 400-500 levels ??
What do you think about movement of this scrip in short term ??
Answer: I would be careful in investing in PVR at these levels. I briefly looked at chart yesterday and there appears to be a triple top kind of structure on EoD.
If it breaks 335-340 on high volumes, you can again take a long and keep a trailing stoploss.
Question: Can you write something about Kingfisher Airways.
Answer: I looked at revenues for KingFisher in Sept quarter. Its just about 200 crores with 600 crores loss! And maybe next quarter may get worse with almost total shutdown.
At this point, its just like a lottery ticket with some investors hoping to come on-board. Not recommended.
Hope this helps.
Question: Can you please do analysis of Harrisons Malyalam ? What you think of this company in long term.
Answer: Harrisons has a diversified business lineup of Tea, Rubber, Cocoa, Spices, Engg Services and Exports. Firm is part of RPG group. Firm is also currently involved in a land dispute with State Govt.
Revenues are steady on an annual basis in last five years, but EPS is flattish. Last three quarter EPS is in negative territory. High Book Value of Rs 172, and entire firm is available at an paltry market cap of just about 120 crores!
Imagine owning a 150 year old, largest agri-business in South India at just about 120 crores.
This is the fate of many diversified old-time businesses currently, one can name so many of them, with huge land tracts, huge Book Value, but share price is languishing in tight low range. Market is giving astronomical valuations to theme based new "hep" businesses, but good old firms are laggards currently.
Probably market is waiting for some value unlocking process, before participants can re-look at such deep value scrips and start bidding up the price. Also high retail shareholding at 43% is also a dampener in price rise.
The land dispute needs to resolve and quarterly EPS needs to improve and come back to black before any chance of steep price increase in this scrip. Only for very patient investors.
Question: I would like to know your view on Usher Agro. What could be the strategy for coming 2-3 month as if look at fundamentals, it is looking great but it had been flat from 3-4 months.
Answer: Usher Agro is a agri-processing firm dealing in wheat, rice and pulses. Looks a strong firm with growing topline and bottomline. Revenues have grown manifold in past 5 years from Rs 141 crores to Rs 811 crores. On a quarterly basis as well, growth is evident.
Firm is available close to Book Value of Rs 71. Firm has paid regular dividends.
Low promoter shareholding of 29.67% is a possible issue here. Debt of Rs 441 crore exists on balance sheet, which is a case with all agri-processing firms for their working capital needs.
Overall, a good firm fundamentally speaking.
Technically speaking, it is out of its Bear market and price may fly once crosses 71. Next set of resistances are at 78. Once 78 is crosses, 105 is possible as well.
Hope this helps. Thanks for reading this post and keep writing in to us.