Financial Results & Limited Review for Sept 30, 2013
Link: Click Here
Management on CORVI Products:
We have very ambitious plans for our CORVI range of products and we are on course. As of date we have logged a turnover of Rs. 1,162 lacs since the commencement of the operations in December 2012. Out of this Rs. 250 lacs was in the the previous financial year 2012-13.
Additionally this month we are launching 3 new products to expand our current range from 4 to 7 products. With their colour / wattage variations the total product portfolio is 72 SKUs as of now.
To repeat we foresee a bright future for CORVI.
Management On Slowdown in Sales of Digital Studio Flash Lights:
Yes, the market for Digital Studio Flash Lights is sluggish, especially on the export front. The off-take is slow as compared to the past. But traditionally the second half has always been better than the first half as it coincideds with the beginning of our festive season and Christmas / New Year abroad. So, even though the demand is sluggish, we hope to bounce back in the second half.
New Ad Of CORVI LED Lights (Thanks to ipogenius for this link):
httpv://www.youtube.com/watch?v=wSiLIlvGY6k
Talking about Q2 Numbers, the biggest positive was that the company has again started making good profit, which was seen after a break of 2 quarters on the account of commencement of new venture by the company, which involves lots of expenses.
Revenues were up by 20% from 15.73 Cr to 18.93 Cr YoY, on the back of good sales of CORVI Products.
Net Profit was up by 45% from 0.6 Cr to 0.88 Cr YoY.
EPS is standing tall this time at 1.82.
My Views:
Everyone knows, that I am not a big fan of net profit, I would rather prefer company showing more growth in sales. But this time, coming to profits was necessary for Photoquip, because many many investors, who believed in bright future of the company had lost interest in the company, because of past few results.
I agree to the fact the company is not able to improve sales in Photographic products, which was their core business, but still it has started its new venture, which is doing slightly better than expected.
As of Oct end, we have a data saying that the total sales of CORVI range of products is 11.62 Cr, out of which 2.5 Cr was in FY12-13. Hence, so far in 7 months, they have been able to sell products worth 9.12 Cr. Going by this pace, if they are able to show a figure of 20 Cr sales by the end FY13-14, I would be more than happy, as it will be considered a very good start for a new venture.
I wont comment much about the stock price movement as of now, but certainly, future looks bright to me.
I, myself is a big fan of innovations, and this company has time and again showed that in their business, hence I am loving it.
One can certainly invest at the current market price.
Good analysis Kunal !!!! I would categorise it under the category of "ACCUMULATE" !!!!
ReplyDeleteBut where do you get the shares of Photoquip !!! In the last four and a half-month(since July 2013) hardly 6K shares have been traded and delivered !!!!!
ReplyDeleteYes, you are right, and that's why I said that it was important for the company to come back to good profit, just to get back the interest of investors...
ReplyDeleteThis or may be next positive result, with an EPS over 2 hopefully, will act as a trigger to generate more trades on the counter..
Movement to PCA category is also heavily responsible for lesser trades...
Right now, we can just wait and watch!!!
Also the fact that, even management would be looking for their 5% acquisition, there is surely going to be an increase in volumes in this counter very soon...
Where are the shares pocketed/parked for promoters? With naked eye I can see only 2.63% with Soni & Ajmera !!! I am sure Nitin Arora with 2.02% is not going to unload in favour of promoters. May be something more with less than 1% share of shareholders, something with non-promoter directors !!! But the line gets drawn after that !!!! And I have my very very great apprehensions on PCA !!!! Why don't you initiate a topic on PCA separately? In fact, small-cap stocks have been decimated mainly because of PCA...
ReplyDeleteWill Photoquip India be inching towards a top line of 100 crores? :-)
ReplyDeleteI feel profitability will be impacted if they launch their TV commercial but sales will pick up. I think its a long wait maybe maximum 1.5 years before any significant upside in profits.
ReplyDeleteExpecting atleast 90 Cr this year.... not sure about 100....
ReplyDeleteBut definitely next year, it will be close to 120 Cr with a PAT of close to 5 Cr, which will take the annual EPS of close to 10.
If it does achieve it successfully, we could see price near 100...
What do you think?
I think most of the heavy marketing expenses of CORVI products has already been factored in results of Q4 FY13 and Q1 FY14...
ReplyDeleteSo, as far as I feel, profitability will continue, but yes, as you said, margins will remain low initially. I also agree, that margins, will improve significantly from next year...
Ricoh India: Intimation of Floor Price
ReplyDeletehttp://www.bseindia.com/xml-data/corpfiling/AttachLive/Ricoh_India_Ltd_181113.pdf
According to Sebi, the floor price should be the average of weekly closing highs and lows of 26 weeks or of the last two weeks, whichever is higher.
Was going through some of the stocks, that I didnt pay much attention earlier, because of the fact that, even after consistency in performance, there were no volumes on the counter....
ReplyDeleteFound one of them starting to pick up atleast to some extent, Superhouse Ltd.
P/E ratio of 2, book value of more than 150, and stock trading at 67, and that too, after strong numbers this quarter....
Have you taken a look at Arrow Coated Products. 25 crore company holding numerous patents . 370% rise in PAT this qtr and 44% PAT margin.
ReplyDeleteLooks excellent at first go.... will try to find out more details....
ReplyDeleteBut certainly fits in every parameter of becoming a multibagger...
Thanks once again!!!!!
Try to go through Superhouse Ltd and Paushak ltd. also once, and let me know your views on it....
Hi Kunal,
ReplyDeleteI have been tracking Mirza International and Superhouse. Mirza's profit margins are higher, and Redtape brand may penetrate more into domestic market. I am not particularly impressed with Superhouse's allen cooper shoes. Please share your views on Mirza International. I am planning to take a position in Mirza.
Thank you,
Shekhar
Hi Shekhar,
ReplyDeleteI haven't tracked Mirza Intl, so will be slightly difficult for me to judge, but still on basis of fundamentals, I would add something.
From valuation perspective, yes, Mirza Intl is trading cheap, but I feel that liquidity is too high in that counter for it to become a multibagger from these levels. It can certainly give you good returns going ahead, but difficult to see it at 3x-4x levels....
Whenever liquidity is high, it is important for stocks to perform exceedingly well, above expectations continuously to become a multibagger (eg. Suven Life Science), which is yet to be seen from Mirza.
There is growth, but that is steady (which is also good, but not great).
So, its a kind of safe investment which will give you good returns.
As you said, if they penetrate more into the domestic markets, and results are seen accordingly, on consistent basis, then, you can expect it to become a multibagger.
Once again, I saw this counter for the first time, and gave my views based on first look. So take your decisions based on your judgement. :-)
Regards,
Kunal Banker
Thank you. I had overlooked liquidity angle.
ReplyDeleteI invested in Granules India yesterday (I opted this over FDC, which I came across in this article http://forbesindia.com/article/column/neglected-firms-stocks-knowing-when-to-sell/36339/1). Probably will invest more if it goes down further. After seeing your earlier posts, I considered investing in it. The one of the concern I have about Granules is how or whether they will come out of being commodity producer. The success of JV with OmniChem would be crucial. Aggressive expansion funded by debt is also a concern. However I feel these very concerns have resulted in fairly lower valuations. Once things are clear it might be late to invest.
Regards,
Shekhar
You mentioned all the concerns correctly, and as you said, they are prime reasons for such low valuations...
ReplyDeleteBut one has to understand the company's nature of growth...
They are leaders in API and PFI facilities and they would certainly like to improve on it, by acquiring companies that has their own set of clients....
But yes, increasing debt is certainly a concern...
That's why to enjoy full benefits of your returns, one has to be a long term investor...
And always if you see, re-rating of any small cap companies happens at one go, and that can come anytime, if company comes out with consistently growing set of numbers...
So far, after expansion, they have successfully delivered strong numbers, and on top of it, management is very hopeful about performance in Q3 and Q4 of this fiscal.
Hence, at current market price, one can enter the stock and also, use dips to buy more...
Thats my opinion!!!
C Krishna Prasad of Granules India released 1.25 Lakh shares from pledge....
ReplyDeletehttp://www.bseindia.com/xml-data/corpfiling/AttachLive/Granules_India_Ltd_211113_SAST.pdf
Good to see that even after Ricoh India moved from 55 to 105 levels, it didn't show a sign of corrections, that means, it has formed its new base above 100.... and today after some movement earlier in the day, it went on to hit upper circuit....
ReplyDeleteIf buyers are even ready to buy around 115 levels, that shows delisting price could be at much higher levels.....
Lets hope for the best!!!!!
1000 crore turnover Japanese MNC !!!! Most ethical and Dow sustainable listed Major !!!!And the only subsidiary in the world besides Parent Company which is listed on a Stock Exchange !!!!With a potential of 25% GP margin !!! Does it not deserve a market cap of atleast 1000 crores?
ReplyDeleteI am of the opinion that for Ricoh Japan this second attempt is now or never !!!! In fact, delisting will be an uphill task if this attempt fails !!! Reason being Ricoh India will bloom in full swing quarter after quarter !!! Top line is reaching to a point where profits are not only bound to flow rather overflowing :) !!! Personally, I will be happier if delisting fails :) :)
ReplyDeleteI can understand the excitement with the growth potential of the company, but one needs to also understand the fact that, once delisting is cancelled, stock price will take a severe hit, may even go below the levels it was trading before the proposal. Of course, that is for short term....
ReplyDeleteTo achieve 1000 Cr market cap, after a failure of delisting would be an uphill task, it may take 2-3 years of strong and consistent performance.....
Because, if you check history, cancellation of delisting proposal has always been taken disastrous event by the traders, and it doesnt matter what the fundamentals of the company are.... :-)
What do you say?? :-P
That's well understood !!! Last time also when the delisting failed it came down from 87-88 to 40s !!!! Fundamentals always prevail but only in the long run !!!! Have I married with the stock? :-) :-)
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