Hello Fellow Members and Basantji,
I was looking at some of the balance sheets of the PSY companies and and I was really amazed to see this sort of valuation available on the plate. The most noticeable ones which have attracted my attention is BEL and Shipping Corporation. BEL, is trading at an amazing valuation. It has a small capital, relatively speaking of 80 crores and has a cash of more than Rs. 1800 crores on its balance sheet as on 31.03.2006. The story is same for Shipping Corporation, which has a realtively bigger capital of nearly 282 crores has a whopping 2200 crores of cash on its balance sheet. BEL, has an added advantage of a negligible debt on its balance sheet and has a much stable business model than Shipping Corporation.It supplies to defence and other nodal government agencies.
SAIL and ONGC are also looking very attractive to me.To some extent, State Trading Corporation as well. The PSY banks have run up a lot so wont say whether they are looking attractive or not. But SAIL is something which is looking way too good, at these prices at least.
All I intend to know is, what wrong have they done to be treatedlike this. They dont dilute their holding, they pay quite decent dividends, are also cash rich, have the sovereign backing, so whats wrong with them?