Multibagger Stock recommendations of Mudar Patherya in Business Standard

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Ravi
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Multibagger Stock recommendations of Mudar Patherya in Business Standard

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Mudar Patherya has recommended four stocks in Business Standard:

Sandur Manganese: Everyone, including my mother-in-law, wants to acquire this company for its ore deposits and governance. The challenge is the business. Being commodity-driven (iron ore), profits swing in line with ore price moods. When prices are humble, there are losses on the books. When prices rebound, profits do the rope trick. Which is what you will see across the past five quarters. In four quarters, the company reported an aggregate pre-tax (and pre-exceptional items) profit of Rs 1.7-odd crore. During the September quarter, the company reported a pre-tax profit of Rs 10.8 crore. Two points: Absolutely no debt on the books, piffling depreciation (average Rs 1.3 crore per quarter), 17 per cent earnings before interest, taxes, depreciation and amortisation (Ebitda) margin and a huge perating leverage.

Kaveri Seed Company: They said the best days were over for this company. When you see the second-quarter results, you get a different picture. In what is usually a weak quarter, the company reported Rs 20 crore Ebitda, hefty other income (which means raw cash on the books), no interest and a Rs 55 crore bottom-line swing (loss to profit). And, there is always that first quarter to build a dream on: nearly Rs 164 crore in Ebitda. Equity Rs 13.8 crore, if you please.

West Coast Paper: For long, one really doubted whether there was hope for paper manufacturing heavies in an India rapidly digitising with high interest rates. Turnover for West Coast was the second highest in the past five quarters, even as Ebit (earnings before interest and tax) rose for everyone of the past five quarters, and interest was the lowest during this tenure. The validation: Interest cover was six-plus during the quarter under review compared to 3.5 during the same quarter in 2015-16. Looks like something happening here.

Electrosteel Castings: This company has seen glorious days as a ductile iron pipe pioneer. Then, it attempted to integrate backwards, added debt and lost its way. There could now be the semblance of a comeback . Ebit was the highest ever in the second quarter across the past five; trough of Rs 54 crore rising to Rs 88 crore. Net profit rose from an average of Rs 14 crore a quarter across four quarters to Rs 32 crore during the last quarter. Net interest declined from the late thirties to Rs 26 crore in the space of a single quarter. There are really only two triggers here: How the company strengthens the top line and how it can moderate its interest outflow. If the company gets it right here, this could be the start of a new chapter for it

http://www.business-standard.com/articl ... 041_1.html
Never give up your dreams
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