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Friday, 22 June, 2007

Three A's (AAA)

First the three A's are for Adhunik Metallics, Alps Industries, and Abhishek Industries. Moja introduced us to the first 2 A's and the third one is just another company from the textile sector.

2 of the three are from the textile sector which is a "sitting duck" as someone may like to quote. Actually Arvind Mills could also have been covered here but will save that for some other time. Moving on we came across Abhishek Industries while trying to look for something new. The company has been posting a PAT for around 40 crores for the last 4 years and at the present market cap of 340 crores is not an expensive buy. But none the less as Sudhir says he does not like the managment and the share price though not high will be better still if it goes somewhere below 15. Again why the textile sector is in such a shape currently we do not know and will love pointers on the same. Is it the capacity utilisation of some of these textile firms or ...

The other 2 were stories given by Moja and though moja gave the adhunik story at 36 - 37 the price has risen since and oscillated as well. Both these stocks are discussed here on behalf of Moja who on repeated requests has not produced an article for the same. Adhunik looks to be in a promising industry where the tailwinds seem to be with the company for sometime to come. The company is definitely on a growth track but we will not like to take the discounted value for the growth into the valuation for the stock. With the kind of results posted for FY 2006 -07 the company was worth a dekho at 36 but at current level (well, price changes everything) ... :-)

As for Alps industries this is the fav of the three, something which is trading at a huge discount to the book value of Rs. 147. Does this book value really represents the liquidation value, we have not done the calculations. But surely as per the numbers go this one looks the most comfortable but again is a company in the market cap of 100 - 200 crores and we are already saturated with companies with similar market values. Though one of the important criteria in picking a stock should be the marketability of the scrip, and this scrip satisfies those criteria unlike some of the others in similar M Cap range.

All in all not too much numbers presented here for the three companies but this is more for getting some views on the same especially for the ones belonging to the textile industry.

We have interest in one of these scripts, moja and freinds have interest in another and the third one is Just for ...