cords cable-blog write up_01!02!16

8/16/2019 Cords Cable-Blog Write Up_01!02!16

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Opening Note:

Welcome dear friends and fellow investors. At the outset, we

invite you to our newly started blog which has a single most

objective of identifying and discussing high potential

investment picks in Indian Listed equity space. alue investing

is the core of our investing philosophy and we will stick to it in

any market situation ! "ull or "ear,

our e#perience has made us $rmly believe that no matter what,

value investing has always paid o% for the patient and

disciplined investors.

As a matter of introduction, we are two friends with a passion

for equity !amateur but e#perienced, We $nd any and every

e#cuse to discuss about Indian markets no matter how tied up

we are in our professional and personal lives. &ave learnt the

good, the bad and dirty in Indian equity markets, and have

learnt it hard way. 'he notion that has always stood out is,

sooner or later market does recogni(es the potential in the

deserving ) in the long run ! the froth subsides and only

substance shines. As the famous quote of Warren bu%et says !

only after the tide is gone, you $nd out who was swimming

naked.

*o this is the place for intelligent discussion, and for that

matter serious discussion on Indian equity markets. +ont

e#pect any so called -tip, dont e#pect the stocks discussed

here as any recommendation or endorsement or dont e#pect

any miracle to happen with the stocks on this blog, or in the

equity market as a whole for that matter. "e realistic, you are

buying share in a business and not a lottery ticket /quity is

just an asset class, which o%ers potential for high returns

against higher risk, and most of the time investments made in

equities rationally, with right basics in place, right

diversi$cation and right discipline ! it has outshined everything

else in the longer run.


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+o ask questions, discuss your opinions and do give your

suggestions. /veryone is invited in this e#citing journey of

building wealth.

We are also found visiting sometimes at the famous 0Adda1 of

Indian /quity investors, 2oney3ontrol.com with the user name

of 'hee#pertadvise and A4uentinvestor5.

+isclaimer6

Blog 1

'he recent sudden crash in the market has many stories, china,

7ussia, oil, wars and all doom and gloom about the collapse,

downfall, recession, stagnant growth and many such di8cult

sounding words, but in our opinion ! it has done a wonderful job

of separating the wheat from the chu% and throwing many

attractive opportunities to enter into some really good bargains

on o%er by 2r. 2arket.

9ne such opportunity that we believe is 3ords 3able industries

Limited. 'here are some very generic ordinary factors which are

all coinciding at the same time which is making it very

attractive at current prices.

Key highlights:

An over :; year old Industrial 3abling company,

established name in "


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perform, there is an opportunity in the budget and there is

a clear focus on developing infrastructure.

'hey are also into growth sectors like > solar cables,

2etro ? highway, o%ering a lot of pent up demand and

good order book.

9nce among the @orbes list of Asias best small

companies, the performance of the company went

stagnant for past few years due to sluggishness in the

whole sector and the company seems to be at the right

in=ection point to take the advantage of huge boost to

Infrastructure ? positive $scal situation of Indian ovt.

3urrent valuation o%ers a great margin of safety and

limited downside risk. 'he company o%ers a right balance

between limited =oating stock and liquidity in the trade.

A large and respected name in Indian equity investor

fraternity has acquired new equities recently in the

company on a preferential basis.

Introduction:

3ords 3able Industries Ltd. manufacture and salescommunication, control and instrumentation cables fordomestic and industrial use. Its product includes Low 'ension3ontrol 3ables, Low 'ension >ower 3ables, Instrumentation,*ignal and +ata 3ables, 'hermocouple/#tensionB3ompensating 3ables, >anel Wires, &ouse &oldWires, @le#ible 3ables and *pecialty 3ables mainly for industrial

use. 'hese products cater to a wide spectrum of cable users invarious industries like power, steel, cement, fertili(ers andchemicals, re$nery B petroleum, Water +esalination, 2etro 7ail,Airports, solar and many others. 'he 3ompanyCs clients include"&/L, D'>3, &indalco, A33, &>3L, AIL, 'A'A *'//L, *iemens,&oneywell, L?', 27>L and others

In Eanuary 9 G >riced at7s. 5:H per share and on 5: @ebruary


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India. @or the purpose of *etting up of the production facilitiesand 'o meet the long term working capital requirements of the3ompany.

•In aci$c 7egion to be listedby @orbes maga(ine in its CAsiaCs *s, ? 7ailways as their customers.

'hey are active in all major infra developments into cables for

power transmission, airport, railway, re$nery and even *olar

>ower etc.

Basic financials and growth parameters.

https://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttps://en.wikipedia.org/wiki/Asia-Pacifichttps://en.wikipedia.org/wiki/Forbeshttps://en.wikipedia.org/wiki/International_Business_Timeshttps://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttps://en.wikipedia.org/wiki/Asia-Pacifichttps://en.wikipedia.org/wiki/Forbeshttps://en.wikipedia.org/wiki/International_Business_Times


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LATEST 12 MONTHS VALUATION

THREE-YEAR AVERAGE

PRICE/SALES 0.8 SALES GROWTH 67%

EV/EBITDA 1 NAEPS GROWTH !8%

PRICE/EARNINGS !0

DEBT/EQUITY 2 ".0% RETURN ON EQUITY 3 "%

M: and MN re historically good.

if u read.. th prices hv come down...un line wth commodity ..

thts y sales =at

'he company is promoted by 2r OOOOO and they have been in the sameline of business since) 3ompany has been posting positive >A' numbers

since last many years and they have been rated """ e#ternally by 3A7/.Although there has been a dip in the topline of the company, but still thecompany has been able to maintain stable /"I+'A margins of appro#. 5;Pin the last : years.@or year endedB ending 2arch :5


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Control

&

Electric

alWiring

Cables

(upto

1.1 KV)

LV Power

Cables

(upto 1.1

KV)

Instrumentati

on !ignal and

"ata Cables

#$ermocouple Cables%

Control

CablesUse

d ininterconnection ofprocess

control,communication and

panelcontrol

systems.Electrical

Wiring

Cables

Used forelectricpower,

lighting &internal

wiring.

Used inconnection of

power supplyto residential,commercial &industrial units.

Used in dataacquisition

systems,computernetworking,PA systems,

digitalcontrol /measuring &

communication systems.

Speciallydesigned totransmitsignals

without anyexternalinterference.

Used toextend

thermocouple circuitsfrom thesensor to

referenceunit.

Products Tested and approved by below establishedAgencies India and worldwide – eectively !a"ing#ords$ products saleable anywhere%


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#anufacturing units.

3hopanki unit

Sahrni unit

Pro&le o' #usto!ers: (stablished na!es inB)B


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Pro!oter *uality

+is"s:


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2acro risk

Limited capacity

+elay in infra projects

2argins very low

+ecent (ntry o' ,ar*uee investor ,u"ulAgarwal%

Last : mo nths dtelivery status in cords. 9ut of only N; lac odd

available =oat.. there was a detlivery based trade fr 5F lac

share in last month.9nce the /2 happens for allotment of share.. thn more

people will know abt who he is and his investments successes..

Any major succes story u can think of ... arrow coated,

cambridge, shreyas, intellect, 2 breweries, S++L

people like him dont make loss making deals... especially in

markets like current...when capital is so scarce.. he is putting

aside RF crore in lock in.. so de$nitely he hs big plans.

>ortfolio of 2ukul Agarwal of >aram 3apital !

http6BBalphaideas.inB


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levels and the price is safe to enter. With each up move, the

price is settling at a higher base and not retracing back, this

suggests entry of more long term investors rather than traders.

-u!!ary:

.ere are so!e insights on why this co!pany is going to

be a 'uture !ega winner 'ro! the structural changes

that India and world is going to see in years to co!e%

Degligible debt ! D9 pledging, 2arket cap only J; 3r. , J;Pstock held by promoters , N;P =oating stock is concentratedamong few long term investors, and current price at veryreasonable level without any e#pensive valuation of the bullrun! 'here is every recipe in it for a safe and successfulinvestment for medium to long term.

@or a premium 2D3 subsidiary with RHP promoter holding , fast

growing industry , a turnaround candidate and with fast

increasing turnover ? capacity tili(ation, products with

established brand and entry barriers, a market cap of 5


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/actors which !a"es it an attractive play at current

price%

• Low =oat

• 3ords cable has only N; lac share in mkt... out of which

almost 5F lac traded delivery based in last one month

since mukul agarwal news..nd at least 5; lac sud hv gone

into strong hands

• 7easonable valuation 'he stock has not gone down

signi$cantly below N; in last one year ... /ven I>9 was at

5:H

• &igh sales to 2cap ratio

• /ndorsed by a big investor and an established name 'he

ne#t egm is ne#t week when his allotmemt wll be

approved.

• @und raising for working capital and meeting >ent up

demand'hey need working capital to e#ecute the order

pipeline.

• &ealthy order book 7ead the management interview on

moneycontro 'hey hav 5;; crore order pending Another

5;; crore in pipeline

• Attractive sector Last : years hv been bad fr infra sector

anyway... hw will u see the growth'hey supply cables to

railway, airports, power transmission, re$neries,

households.. *o a good pro#y to Infra nd consumer

spending. Dd they re very old company in e#istience..With

good relatiosnhip wth govt... *o must be bene$ciary of

huge govt spending on Infra in ne#t


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• 2anagement interview Link6

http6BBwww.moneycontrol.comBnewsBbusinessBfreshorders

worthrs5;;cre#pectedqNfy5JcordsONRJ

cords cable-blog write up_01!02!16

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