Intraday calls

[n_arvind2000]

MT Educare - Bulls EYE Call -- Medium Term

We would like to Initiate a BUY on MT Educare (BSE Code : 534312) as a medium term Investment Idea that can deliver strong returns to Investors over the next 6 Months to 1 year. We believe that quality Educational stocks would continue to grow strongly over the next year and with the improved long term outlook on the country, they will continue to get re-rated.

MT Educare is a great play on the growing demands of Test Coaching in India. The company has an asset light capital efficient model that continues to churn strong numbers. We believe that MT Educare is one of the few brands to have successfully scaled up across divisions and geographies in the coaching space. We continue to like MT Educare's business model of generating negative working capital that helps in improving capital efficiencies.

The company is run by a good Management team and is backed by several intelligent investors, including Prof. Manekar who is known for his shrewd investments. At the current price, MT Educare continues to be one of the few quality small caps that is available at reasonable valuations. We believe that there are triggers in the form of increased Operational leverage and maturing centers that would help the company to get re-rated going forward.

Key Positional Call details :-

Buy Price - CMP (Around 140 Rs/ Share).

Target for the Trade - 215 - 235 Rs/ Share.

Time-Frame for the trade - 4 - 6 Months.

Allocation % - 4 % of your Capital.

We believe that the company is extremely well positioned to capitalize on the growth opportunities in the Indian coaching space with its strong brand image across verticals. We believe that the company's growth strategy is well planned.

In addition to such growth prospects, the company's financials are rock solid. It has a net cash Balance sheet, enabling it to grow without diluting equity or taking higher loans. We believe that company's PAT growth can continue to be better than its Revenue growth.

We believe that - In today's hyped market, there are few companies that can generate consistently high ROE's of around 20% and still get quoted at FY-15 (E) P/E of around 16X. We believe that the stock would get re-rated as the business performance comes through over the next few quarters. Hence, we are initiating a new Bulls Eye call on the stock. :thumb:

Results Update:
MT Educare Fantastic Results - PAT 44% Q-o-Q and 18% y-o-y to 14.9 crores

MT Educare reported net profit of Rs. 18.8 crores for the half year ended 30th sept. 2014, as compared to 12.64 crores in corresponding last year half. The reported PAT includes one-time gain of Rs. 3.89 crores due to change in depreciation policy from WDV to SDM method. Hence the adjusted PAT of rs. 14.9 crores represents a rise of 18% y-o-y. :clap:

Total consolidated Income for H1 FY 14-15 stood at Rs. 198.88 crores as compared to Rs. 108.76 crores in H1 FY 13-14, a growht of 10% y-o-y.

MT Educare has declared an interim dividend of 6% resulting in total payout of Rs. 2.88 crores, including dividend distribution tax. :clapping:

Record Date for dividend: 21st Nov. 2014 :clap: :clapping:

 

[n_arvind2000]

Short Term Trading Call:

BUY VAIBHAV GLOBAL 670 - 680 TARGETS 749 - 811 - 865 SL 629

 

[n_arvind2000]

Short Term Trading Call:

BUY VAIBHAV GLOBAL 670 - 680 TARGETS 749 - 811 - 865 SL 629

Government to announce curbs on gold import in a day or two: Sources

In the wake of surge in gold imports, the government would soon impose some curbs on its inward shipment to prevent current account deficit (CAD) from going out of hand.

"Things are being worked out by the Finance Ministry and some announcements (restrictions) may come in a day or two," a source said.


News based fall ....... should recover soon..

Stock will bounce back soon !!!!!!!!
Posted fantastic results of 40.95% rise in net profit for September 2014 quarter !!!! :clap: :thumb:

 

[n_arvind2000]

MT Educare - Bulls EYE Call -- Medium Term

We would like to Initiate a BUY on MT Educare (BSE Code : 534312) as a medium term Investment Idea that can deliver strong returns to Investors over the next 6 Months to 1 year. We believe that quality Educational stocks would continue to grow strongly over the next year and with the improved long term outlook on the country, they will continue to get re-rated.

MT Educare is a great play on the growing demands of Test Coaching in India. The company has an asset light capital efficient model that continues to churn strong numbers. We believe that MT Educare is one of the few brands to have successfully scaled up across divisions and geographies in the coaching space. We continue to like MT Educare's business model of generating negative working capital that helps in improving capital efficiencies.

The company is run by a good Management team and is backed by several intelligent investors, including Prof. Manekar who is known for his shrewd investments. At the current price, MT Educare continues to be one of the few quality small caps that is available at reasonable valuations. We believe that there are triggers in the form of increased Operational leverage and maturing centers that would help the company to get re-rated going forward.

Key Positional Call details :-

Buy Price - CMP (Around 140 Rs/ Share).

Target for the Trade - 215 - 235 Rs/ Share.

Time-Frame for the trade - 4 - 6 Months.

Allocation % - 4 % of your Capital.

We believe that the company is extremely well positioned to capitalize on the growth opportunities in the Indian coaching space with its strong brand image across verticals. We believe that the company's growth strategy is well planned.

In addition to such growth prospects, the company's financials are rock solid. It has a net cash Balance sheet, enabling it to grow without diluting equity or taking higher loans. We believe that company's PAT growth can continue to be better than its Revenue growth.

We believe that - In today's hyped market, there are few companies that can generate consistently high ROE's of around 20% and still get quoted at FY-15 (E) P/E of around 16X. We believe that the stock would get re-rated as the business performance comes through over the next few quarters. Hence, we are initiating a new Bulls Eye call on the stock. :thumb:

Results Update:
MT Educare Fantastic Results - PAT 44% Q-o-Q and 18% y-o-y to 14.9 crores

MT Educare reported net profit of Rs. 18.8 crores for the half year ended 30th sept. 2014, as compared to 12.64 crores in corresponding last year half. The reported PAT includes one-time gain of Rs. 3.89 crores due to change in depreciation policy from WDV to SDM method. Hence the adjusted PAT of rs. 14.9 crores represents a rise of 18% y-o-y. :clap:

Total consolidated Income for H1 FY 14-15 stood at Rs. 198.88 crores as compared to Rs. 108.76 crores in H1 FY 13-14, a growht of 10% y-o-y.

MT Educare has declared an interim dividend of 6% resulting in total payout of Rs. 2.88 crores, including dividend distribution tax. :clapping:

Record Date for dividend: 21st Nov. 2014 :clap: :clapping:

Recently ICICI Securities Research Team met up MT Educare Management and came up with report titled....

'MT Educare - Organised play in unorganised industry…'

We met Yagnesh Sanghrajka, CFO, MT Educare, to understand the company’s business model and future prospects. The company was started as “Mahesh Tutorials” by current founder and CEO, Mahesh Shetty, in 1988, and focused on school coaching in Mumbai. Over the years, the company has widened its geographical presence – expanded to other states such as Karnataka, Andhra Pradesh, Gujarat, Punjab, Haryana, Delhi, Tamil Nadu – and business segments (school - 44% of revenues, science - 25%, commerce - 18%, MBA, Robomate products) by bringing pan-India curriculum experts under MT’s umbrella. Growth momentum was helped by a combination of organic growth (opening of Mangalore pre-university, PU, campus to offer XI, XII and engineering coaching), and acquisitions such as Chitale Personalised Learning Centre (2011, MBA coaching, Mumbai), Lakshya (FY13, Advanced IIT, Chandigarh) and Sri Gayatri Education Society (FY14, engineering, AP).
Karnataka, Lakshya may be game changer for science vertical

The management commentary suggests that changes in IIT/engineering admission procedure could present significant opportunities for pan-India players like MT Educare and help accelerate growth. Note, the company operates a pre-university (PU) tie-up model wherein it provides test prep coaching for engineering and medical entrance exams post college hours using campus premises in a revenue sharing model. Currently, 14 such operational college tie-ups exist in Karnataka, which the management hopes to raise to 30 by FY18E. MT also built a PU college at Mangalore with a capacity of 3,000 students (current utilisation, 55%) accompanied by a hostel facility. The planned capex of | 60 crore was funded through internal accruals, while the company plans to lease back the facility by FY15E end. Further, acquisition of Lakshya (focusing on IIT advanced testprep) in the North could bear fruit as the company plans to leverage the brand and expand it to other geographies (Mumbai, Pune, Kolhapur, Nashik and Karnataka). MT also plans to launch foundation courses (Standard VIII-X) in Mumbai to act as a feeder for IIT advanced batches. Noticeably, the company is seeing healthy conversions from X to XI students and suggests excellent brand recall for MT.

KEY TAKEAWAYS'

Healthy balance sheet metrics, dividend payout ratio..

MT Educare's revenues, PAT grew at 23%, 51% CAGR during FY09-14 to | 201.8 crore, | 20.8 crore, respectively, while EBITDA margins expanded 8.5 percentage points (pp) to 21.1% vs. 12.6% in FY09. The company increased its dividend payout ratio to ~43% in FY14 vs. ~18% in FY11 with RoEs of ~20% in FY14.

Getting foothold in AP via tie-up with Shree Gayatri Educational Society
The company plans to replicate the Karnataka model in Andhra Pradesh,
albeit through its partnership with Shree Gayatri Educational Society
(SGES). SGES has ~33,000 students (9,000 residential, 24,000 day
students) spread across 71 locations and 51 centres. It offers four types of
courses, starting from the regular batch (state board) to advanced IIT
preparation. Current realisation rates are generally lower than local peers
while MT sees scope for improvement given the improving revenue mix
towards advanced courses and as its leverages the strength of the
Lakshya brand. The management expects incremental revenue
contribution of | 50 crore from SGES in FY15E. :clapping:

Contrary to industry, no “Star” teacher concept in MT…
While majority of the coaching institutes in the country have a “Star”
teacher concept, who act as crowd-pullers, MT does not work on one but
“many”. Lecturers at MT comprise full-time and visiting faculties who are
offered training to ensure uniformity and work on set standards of the
institute (100-150 hours training for school coaching, 250-300 hours for
test preparation). As of FY14, MT Educare employed ~1,300 teachers vs.
892 in FY12, a CAGR of 21% while employee costs have risen from | 18
crore in FY12 to | 28.6 crore in FY14, led by increased teacher intake,
training costs and rising salary. :thumb:

Robomate – future growth engine in schools
Though revenues in the schools division are highly concentrated in the
Mumbai region, MT plans to widen its presence across Maharashtra
through the franchisee model. Recently, the company also started selling
Robomate products – online content delivery developed in controlled
environment – to reach non-MT students. The product offering is
available across all verticals (engineering, medical, CA) at prices ranging
from | 20,000 - | 75,000. Till date, Robomate registered sales of | 2.5
crore. :thumb: :clapping:

Take: Hold on for excellent returns in the coming months !!!!!

 

[n_arvind2000]

Government to announce curbs on gold import in a day or two: Sources

In the wake of surge in gold imports, the government would soon impose some curbs on its inward shipment to prevent current account deficit (CAD) from going out of hand.

"Things are being worked out by the Finance Ministry and some announcements (restrictions) may come in a day or two," a source said.


News based fall ....... should recover soon..

Stock will bounce back soon !!!!!!!!
Posted fantastic results of 40.95% rise in net profit for September 2014 quarter !!!! :clap: :thumb:

Timepass ji - do u have info. on why Vaibhav is falling more ?

In BSE disclosures.. i could see for the last 3-4 days 'Vaibhav Global Promoter Group' has been purchasing the shares in open market... Details below :

Krishkin Impex Pvt. Ltd - 25,000 shares on 13th Nov. at Rs. 746.01 valued at Rs. 18650471.86/-
Krishkin Impex Pvt. Ltd - 25,000 shares on 14th Nov. at Rs. 745.16 valued at Rs. 18629124.70/-
Krishkin Impex Pvt. Ltd - 15,000 shares on 17th Nov. at Rs. 747 valued at Rs. 11206466.33/-

Brett Plastics - 10,000 shares on 17th Nov. at Rs. 746.66 valued at Rs. 74,66,854.47/-


Total : 75,000 shares @ 746.03/-

Is there any deliberate way to bring the stock price down ?

 

[timepass]

Sorry boss, not into positional, not into fundamentals. No news either.

Timepass ji - do u have info. on why Vaibhav is falling more ?

In BSE disclosures.. i could see for the last 3-4 days 'Vaibhav Global Promoter Group' has been purchasing the shares in open market... Details below :

Krishkin Impex Pvt. Ltd - 25,000 shares on 13th Nov. at Rs. 746.01 valued at Rs. 18650471.86/-
Krishkin Impex Pvt. Ltd - 25,000 shares on 14th Nov. at Rs. 745.16 valued at Rs. 18629124.70/-
Krishkin Impex Pvt. Ltd - 15,000 shares on 17th Nov. at Rs. 747 valued at Rs. 11206466.33/-

Brett Plastics - 10,000 shares on 17th Nov. at Rs. 746.66 valued at Rs. 74,66,854.47/-


Total : 75,000 shares @ 746.03/-

Is there any deliberate way to bring the stock price down ?

 

[n_arvind2000]

Research report by Axis Capital titled “Catch It Young”: - Vaibhav Global

Axis Capital has issued a report dated 21.08.2014 in which it says:

(i) The potential of Vaibhav Global – a TV shopping and e-commerce retailer of fashion jewelry in the US and UK – lies in simple business economics … profitability led by significant volume ramp up and operating leverage

(ii) Customer base can ramp up ~10x: A combination of product development competency (VGL has 65,000 SKUs of fashion jewelry and creates 100 new SKUs every day) and attractive price point (~USD 20, making it non-discretionary purchase) are necessary and sufficient conditions for significant ramp up in customer base

(iii) Icing on the cake – no significant competition who are primarily focused on deep discount fashion jewelry

(iv) Significant operating leverage as 35% of cost is fixed: Increasing penetration will trigger operating leverage (expect an average improvement of 100 bps/ year from FY15 onwards)

(v) Vision 2020: We estimate VGL to post 20%/ 30% revenue/ PAT CAGR with sustainable RoE of ~30%. Initiate coverage with BUY and TP of Rs 1,140 (27x FY16E EPS of Rs 42); implies 34% upside from CMP of Rs 850”


Nirmal Bang had earlier issued an update where it said:

“Q1 result will be impacted on account of lower volume and higher carriage cost of channel. volume is lower on account of company has outsourced Call center during the quarter and transition impacted volume and company inventory level at studio level reduced sharply in Q4. Both the things has corrected and Q2 will show normal growth. Higher carriage cost is for increasing the channel reach which is more of an Investment. We feel lower volume in Q1 will be made up in next 3 qtr and maintain of EPS expectation of Rs.45 for FY15 and Rs.58 for FY16.
We recommend to Hold the stock and Buy on decline with Target price of Rs.925.”

Investment by major investors:

Nalanda Capital holds 41,10,600 shares constituting 12.74% of the equity. :thumb:
Mathews India Fund has bought 500,000 shares constituting 1.55% of the equity in the Q1FY15 quarter.
Panyaek Jainkijmanee holds 4,21,137 shares constituting 1.31% of the equity. :clap:


Latest Info:

Promoter group purchased even today in Open market:
Brett Plastics Pvt. Ltd. - 25,000 shares on 19th Nov. at Rs. 735.45 valued at Rs. 1,83,86,496.06/- :clap:

Vaibhav Global`s addition in MSCI INDEX will effective from the evening of 25 November.

Take: MSCI inclusion could be a reason for drop in price - I think some people or group of people dragging the price to low levels to enter into it.

 

[n_arvind2000]

Today's View:

Indian markets witnessed the profit booking after hitting the fresh highs on Monday's trade.
It was just a minor profit taking no actual selling pressure seen on the cards. However Benchmark indices managed
to close the day at around 0.5% approximately with Nifty closing just below 8400 at 8482 down 43 points and Sensex closed
down 130 points at 28032.

It was a profit taking day after a long time and there was no fresh selling seen on the cards still the long term trend
is up and technically Nifty is still holding above the 10 DMA key average and if profit booking extends Nifty could
test 8300 but not beyond that which makes the attractive buy for the Indian markets at 8300 levels on Nifty.

For the day we can see a range bound session again with the support of 8350 strict intraday support.

 

[n_arvind2000]

Vaibhav Global came to attention when Vineeta Mahnot of Hem Securities put a buy on it in August 2013. I watched spell bound as the stock price rocketed from Rs. 176 to a high of Rs. 975 on 26th August 2014 giving an incredible return of 454% in a year’s time. Vineeta’s current target price is Rs. 1050. :thumb:

Vaibhav Global has had a tumultuous past. In the period from 2007 to 2010, it incurred heavy losses and was on the brink of bankruptcy. Its stock price slumped from a high of Rs. 230 to a low of Rs. 11. Warburg Pincus had invested Rs. 245 crore in the company. It sold its entire holding in March 2011 for a paltry Rs. 11 crore and booked a loss of 92%.

However, since then, Vaibhav Global has staged a dramatic turnaround. It downsized its operations and changed its business model to full year discount retailing of artificial jewellery and fashion accessories through 24×7 TV channels in the US and UK. The company has access to about 92 million households.

The company has attracted a number of savvy investors and analysts. Notable among the investors is Nalanda Capital which holds 12.71% of the equity (since 2007). Mathews India Fund is a recent entrant (Sept 2014) with a 1.55% stake. :thumb:

Among the analysts, apart from Vineeta Mahnot, Nirmal Bang is a believer in the story. They initiated coverage in January 2013 (when the stock price was Rs. 133) with the caption “Ready to sparkle”. What appealed to them is Vaibhav’s unique & highly scalable e-commerce business model. The high ROEs and commitment to reduce debt are also positive factors it was felt.

A recent recommendation is from Axis Capital which suggests a buy on the premise of “Catch it young”. Axis points out that the potential of Vaibhav Global lies in “simple business economics” that volume ramp up and operating leverage will lead to a spurt in profitability. It estimates that Vaibhav will post 20%/ 30% revenue/ PAT CAGR with sustainable RoE of 30%. :thumb:

Vaibhav Global has also issued an impressive presentation which explains the entire business model of the company.

In the midst of all this cheer, some heavy duty investor has been dumping the stock. The stock plunged about 8% yesterday. Today, it plunged nearly 13%. The volumes were inordinately high with 271,097 shares on BSE and 89,076 shares as against the 30 day average of about 22,000 shares on the NSE and 7,500 shares on the BSE.

If you are looking for a conspiracy theory, then there is the resignation of Sri Burugapalli, Sr. VP, Group Strategy in August 2014. Maybe, his resignation was a routine one. Maybe it wasn’t. The stock price did go soft since then.

I can think of three reasons why the heavy-duty investor could be selling the stock:

(i) The weak Q1FY15 & Q2FY15 results have spooked the investor:

However, this is unlikely because the management made it clear that Q1 was an aberration owing to (a) change in call center from in-house to third party, (b) build-up of inventory at studio & (c) installation of new software. Also, Q2 is known to a seasonally weak quarter for the company. Sunil Agrawal, CMD, did however, refer to “aggressive marketing tactics” by a close competitor which was a “growth roadblock” being addressed.

(ii) Profit booking, raising cash for a better option:

This is possible given the ferocious surge in the price in just the last one year. However, a savvy investor would not dump his holding in this reckless manner but would look for a bulk buyer.

(iii) Some skeletons in the cupboard?

Barring the resignation of Sri Burugapalli, there is nothing to suggest that there are any skeletons tumbling out of the cupboard. Also, the factor against the skeletons theory is the aggressive buying by promoter companies like Krishkin Impex & Brett Plastics. Krishkin has itself scooped up 75000 shares in the past few days. However, the buying has done nothing to stem the tidal wave of selling....

 

[n_arvind2000]

Vaibhav Global :
From low of 475 >>>> 535 !!!!!