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Identifying Multibaggers
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MR TED
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Quote MR TED Replybullet Posted: 10/Apr/2011 at 10:08am
Originally posted by basant

Thermax and Vatech come to mind but not looked at Vatech closely.


Thanks Basantji for your inputs! I will note these and do some research on these two.
Can you please guide me and throw some light from a macro point of view on the 3 sectors i mentioned. Macro, economic for long term with respect to evolving situation in India

Thanks
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hit2710
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Quote hit2710 Replybullet Posted: 10/Apr/2011 at 10:14am
I think govt psu like MOIL and Coal India might make very interesting investment bets for the medium to longer term due to the near monopoly enjoyed by them. Plus with nuclear power plants on the back burner for now, most of power will be generated from coal which could lead to good demand for coal from here on.
Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart.
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Quote MR TED Replybullet Posted: 10/Apr/2011 at 10:23am
Originally posted by hit2710

I think govt psu like MOIL and Coal India might make very interesting investment bets for the medium to longer term due to the near monopoly enjoyed by them. Plus with nuclear power plants on the back burner for now, most of power will be generated from coal which could lead to good demand for coal from here on.


I agree about Coal India, the IPO was just a start of profits for investors. There is already huge demand for coal which is not being met by what india produces. Same goes for oil and gas.
Interestingly, Coal prices do not affect inflation much, so they are not under much regulation, but still below international prices.
50% of floating stock of Coal India is held by FIIs and many corporates like RIL hold a decent chunk.

I feel that the energy for next decade or two will be gas, particularly new technologies coming up in Gas like Shale gas, coal bed methane and government slowly giving in to good prices for gas. Recently government has announced very attractive price for Coal bed methane gas.

Coal and Oil will be always in demand and in shortage in India, but Gas from new technologies can provide the kicker.
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Quote siloni Replybullet Posted: 12/Apr/2011 at 10:30pm
Originally posted by basant

Thermax and Vatech come to mind but not looked at Vatech closely.
 
 
also can have a look at chembond chemicals- a little long term  and chemfab alkali in water treatment and management solutions
 
jbeh20032003
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manish_okhade
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Quote manish_okhade Replybullet Posted: 12/Apr/2011 at 11:17pm
Originally posted by hit2710

I think govt psu like MOIL and Coal India might make very interesting investment bets for the medium to longer term due to the near monopoly enjoyed by them.
 
Hitesh,
 
CIL price already reflects the monopoly, just look at present MCAP which is 4rth largest,still does not digest that it will leave behind RIL, ONGC,TCS. Its hard to imagine that MCAP has enough upside left, i am in fact seeing good short opportunity.....Embarrassed
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Quote MR TED Replybullet Posted: 12/Apr/2011 at 1:06am
Originally posted by manish_okhade

Originally posted by hit2710

I think govt psu like MOIL and Coal India might make very interesting investment bets for the medium to longer term due to the near monopoly enjoyed by them.
 
Hitesh,
 
CIL price already reflects the monopoly, just look at present MCAP which is 4rth largest,still does not digest that it will leave behind RIL, ONGC,TCS. Its hard to imagine that MCAP has enough upside left, i am in fact seeing good short opportunity.....Embarrassed


Manishji, RIL, ONGC and TCS will also grow with time. So that will leave enough room for CIL to grow and still remain at 4 Smile

Read an article which talked about owning resources, commodities stocks which have pricing power and good demand to do good in times of high inflation.

Also, an interesting point in Gas I came across. Government will try to come out with a different kind of subsidy mechanism, at least intent is there. To come up with this kind of a subsidy mechanism, u need distribution of gas at every house, u need to promote LNG, because India imports most of its gas and LPG is not cost effective. Once, LPG is replaced, then LNG in every household will cost very less per month basis and subsidy could be given directly to only the households who actually need them.

This was discussed by bigshots of oil n gas government commissions and GAIL top ppl

No wonder why Mr Mukesh had that LNG pact with BP..what foresight!
Sometimes I feel, Mr Mukesh sits with top ppl of government and they decide future government policies and business decisions together Smile
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Quote camanoj Replybullet Posted: 25/May/2011 at 12:24pm

Madras Fertilizers (listed on NSE) is going through a structural change and can be a multibagger. Here are a few pointers:-

a. Madras Fertilizers is going to get INR 550 crore debt waiver along with waiver on accumulated interest thereon. This corrects its balance sheet at a stroke.
 
b. Company has paid off all lenders by settling dues under debt restructuring. The only debt that it has now is from Govt.
 
c. It makes Urea, which is in short supply and has to be imported at international prices. Govt wants to ramp up Urea production within India and hence incentivising. A new policy on the lines of non-urea fertilizers is under consideration.
 
d. Company has three plants for complex fertilizers. One is being used for toll production for IFFCO. Another one is going to commence operations soon. Third one is under upgradation and will commence later. Complex fertilzer plants have fixed costs of INR 35 crore, which is not being recovered as of now and is a drag on Urea profits. Once 2nd plant commences, it would be able to atleast recover fixed costs. Hence, company's profits would be higher by atleast INR 35crore.
 
e. Interest costs would come down drastically post debt waiver. This will enhance bottom line.
 
f. GoI had given assistance to company to restructure its Urea operations. As a result Urea operations profitability has improved substantially leading to a turnaround. PAT (cleaned for extraordinaries & exceptionals) of INR 51 crore in Q3FY11 and INR 105cr in Q4FY11.
 
g. Company currently uses Naptha as fuel and is converting its plant to run on Gas fuel. This would enhance its efficiency and profitability substantially.
 
h. In Q3FY11, it had INR 47.5 crore gain from one time settlement. In Q4FY11, it had gain of 77 crore on one time settlement with lenders. It paid 78 crores in salaries revision arears for last 5 years in Q4FY11. The above mentoined PAT numbers are after removing impact of these items.
 
i. At Q4FY11 annualised PAT (418 crore), P/E is 0.9 only (INR 23 stock price, market cap 370 crore). AT TTM PAT of 124 crore, P/E is 3 only. TTM PAT is after taking into account net loss of 36 crore in Q2FY11 due to statutory inspection & maintenance shutdown.
 
Bouquets and Brickbats invited.
Manoj
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valuepicks
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Quote valuepicks Replybullet Posted: 25/May/2011 at 5:09pm
structural change is with reference to the industry/sector/economy. Not what's structurally changing within the company.
Investment Rule #1: Do not lose capital. Rule #2: Do not forget Rule #1   - Warren Buffett.
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