I had written on Kirloskar Industries nearly 2 years back. Since then . the stock
has performed poorly and had gone
down all the way to Rs.226 in Dec 2011.
http://libraryequity.blogspot.in/2011/01/kirloskar-industries-asset-rich.html
There have been some changes in equity holdings over the
last 2 years. An update on Kirloskar Industries ....
Equity holdings
42.65 lakh shares – 2.94% of kirloskar oil engines
189.88 lakh shares -23.93 %
of kirloskar brothers
666.40 lakhs shares of 48.53% of kirloskar ferrous
5.88 lakhs shares– 4.58% of kirloskar pneumatic
21.6 lakhs shares -
17.39% of swaraj engines
Balance Sheet :
Paid up equity capital : Rs.9.71 cr
Debt : Nil
Cash : 68.5 cr
Income stream:
Annual Dividend receipts in 2011-12: Rs.15.61 cr
Property licensing fee in 2011-12: Rs. 22.1 cr
Windpower unit sale: Rs.6 cr
FD interest: Rs.7 cr
Land assets:
276937 Sq Metres – khadki, Pune ( 68.4 acres)-leased out to
Kirloskar Oil Engines Ltd
44081 sq metres- kothrud, Pune ( 10.89 acres) – prime ...prime location in Pune.
Apartment rates here are in the region of Rs.12,000-14,000 psf
6070 sq metres – bhare , mulshi, pune ( 1.5 acres)
Other assets:
5.6 mw Windmill
Possible Catalysts:
1)
Divesture of Swaraj Engines stake to M&M.
This should fetch them a minimum of Rs.100 cr.
2)
Development / sale / co-development of Kothrud,
Pune land. Though I’m not privy to land usage restrictions etc prevalent here, this is one of
the most prime areas in Pune on Karve road and minimum valuations should be Rs.300
cr.
3)
Long term sustainable earnings ( from rent +
dividend) are about Rs.40-45 per share.Last year the company paid only Rs.4 per
share as dividend on an EPS ( including extraordinary income ) of Rs.69. Most
Kirloskar group companies have a minimum payout ratio of about 25%. Any move by
the management to bring the dividend payout ratio in line with group companies
should see dividend per share moving up to Rs.10-12.
Risks:
Management quality - at best, sub par.
Stock can languish for a long time in absence of
triggers.
From today, the stock trades under the ‘illiquid’
category.
Valuation:
At the cmp of Rs.350
and market cap of about 340 cr, the stock trades at about 10 times sustainable
annual PAT of about 35 cr.
At the
time of writing this report, the author /his family have an investment interest
in the stock mentioned above. Under no circumstance does the information in
this report represent a recommendation to buy or sell the above-mentioned
stock. This report has been prepared and issued on the basis of publicly
available information, internally developed data & other sources believed
to be reliable. This is just a suggestion solely for information purposes and
does not constitute a solicitation to any person to buy or sell a security.
While the information contained therein has been obtained from sources believed
to be reliable, no responsibility (or liability) is accepted for the accuracy of
its contents. Readers using the information contained herein are solely
responsible for their actions and are advised to satisfy themselves before
making any investments.
Gold inched up early on Tuesday as Asian stocks eased, but was sitting near a seven-week low hit in the previous session as Emmanuel Macron's victory in French elections dampened the safe-haven appeal of the metal. capitalstars
ReplyDeleteAmazing Write -up!
ReplyDeleteThe Indian equity market is likely to be an "outperformer" even as absolute returns are likely to be capped. Equity Tips
ReplyDeleteNice post, get daily MCX NCDEX trading tips and calls. We provide daily calls through mobile by sms,
Equity Tips