About The Company
It just comes as a complete surprise to see that a loss making unit, which has shut down its main business of making scooters since 2006 and its present activity is limited to the manufacture of pressure die casting dies, jigs and fixtures primarily for two and three-wheeler industry and posts a net loss for QFY09, continues to remain a gainer on the bourses.About The Results
The company has a net sales of Rs.71 lakhs and on this sales, it continues to have a staggering employee cost of Rs.3.28 crore. It posted an other income of Rs.2.17 crore. In Q2FY09, it posted its best ever PAT of Rs.12.98 crore and this was mainly on account of the interest received on Income-Tax refunds. This was at nil for Q3FY09. Infact it plans to make provision for tax and deferred tax only in Q4. Yet, its net loss for the current third quarter was at Rs.1.10 crore.
Cues In the Company
1. There has been talk of Blackstone wanting to buy out the 27% stake held by Western Maharashtra Development Corporation (WMDC) but that has apparently not happened.
2. Its holdings in Bajaj companies is the most obvious answer. It holds 16.39 lakh shares in Bajaj Auto Finance as on 31st Dec 2008. And as on 30th Sept 2008, it held 33.87 lakh shares each in Bajaj Holdings, Bajaj Finserve and Bajaj Auto. So the value of investments in these three companies alone is itself worth Rs.317 crore. And this valuation is based as of now, when the markets are so low.
3. Another big positive for the company is that it is totally debt-free, it has got absolutely no term loans or unsecured loans or working capital loans and is stated to have cash close to Rs 95-100 crore in its books.
About The Stock
Value buying could be done in this stock waiting for a ripe time to arrive for value buying.
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