BenZ wrote:Link to the Seyon's analysis ...
http://forum.srilankaequity.com/t1076-sfin-and-kapi
I did some study on this as well. The current value of the share is supporting with the latest results and main attractive point of this share is its on the right track after making losses 2 - 3 quarters back.
Now it showing a very attractive growth and making reasonable profit
I like to categorize this as a long term investment opportunity ....
Do further analysis before buy or sell. This is my view on it. That's all.
Hi Guys
I just re-post my analysis I am looking the coming quarter results, which will be very attractive, since the after rights issue the balance sheet will be restructured and give a sound status of the company, further reduction of the financial cost would give amazing bootom line, based on the current earnings and scenario the price is bit overvalue.... PE reporting more than 50 times.... However i am looking about companies growth like future projects, that would give massive growth in coming quarters...... I can tell one thing the price will not drop drastically from the current level.....................
After the rights issue, as I predicted the 4th quarter and coming quarters results will be remarkable in terms of profit and its value… This 3rd quarter performance is the first step to entering into KAPI's new milestone....
KAPI 3rd quarter results @ Glance - ( Income Statement & Balance Sheet – Group)
Revenue For the quarter - Rs.653,195,579 – 129% increased
Revenue For 9 months - Rs.1,553,568,289 – 45% increased
Operational Profit For the quarter - Rs.179,910,318 – 520% increased
Operational Profit For 9 months - Rs.242,379,741 – 89% increased
Net Profit For the quarter - Rs.126,059,112 – 768% increased
Net Profit For 9 months - Rs.110,218,497 – 641% increased
EPS For the quarter (Before the Right issue) - Rs.22.05 whereas 2009- Rs.2.54
EPS For 9months (Before the Right issue) - Rs.19.28 whereas 2009 – Rs.2.60
Net assets Per Share (Before the Right issue) – Rs.47.18 ---- 2009 Rs. 43.35
The Financial highlights after the rights issue based on 3rd Quarter Results…
The Right Issue
Right issue 19:1 @ 33
Total Share issued on Rights ----------------- 108,639,283
Total Proceeds From Rights ----------------- Rs. 3,585,096,339.00
NAV/ Share After Rights
Equity ----------------------------------------------- Rs.479,584,783
Total Proceeds From Rights ----------------- Rs. 3,585,096,339
Total -----------------------------------------------Rs. 4,064,681,122
Total No of Shares After Rights-------------- 114,357,140
NAV Per Share ---------- Rs.35.54 ( Business Value Per Share)
Total Attributable Value to Equity Shareholder ------------ Rs. 269,778,996
Total Proceeds From Rights ----------------- --------------------Rs. 3,585,096,339
Total ----------------------------------------------- -------------------- Rs. 3,854,875,335
Total No of Shares After Rights----------------------------------- 114,357,140
NAV Per Share ---------- Rs. 33.70 ( Value /Share to Equity Shareholder)
EPS / Share After Rights
Total Group Earnings --------- ---------------------------------- Rs.110,218,497
Total No of Shares After Rights----------------------------------- 114,357,140
EPS/ Share ------------- Rs. .96
Total borrowing of Group ( As per Dec 2010)
Interest Bearing loans---------------------------------- Rs. 849,770,754
Non Interest Bearing loans--------------------------- Rs. 3,597,928,709 ( this may be received from related company to acquire the
company , stated in the propose of right issue)
Overdraft ------------------------------------------------ Rs. 311,689,918
Total Borrowings --------------------------------------- Rs. 4,759,389,381
Total Interest Expenses.-----------------------------------Rs 112,228,527
The Purpose of right Issue
The purpose for which the proceeds of the issue are to be utilized
1. To capitalize loans received for the acquisition of companies previously
2. To acquire Northern Power Company (Pvt) Ltd
3. To Finance Working Capital of the company
http://www.cse.lk/cmt/uploadAnnounceFiles/9961288151500_444.pdf
The proceeds of this Rights Issue will be used for the 100% purchase of Northern Power Company Private Limited, a 30MW HFO power plant located in Chunnakam, Jaffna, as the largest provider of electricity to the Jaffna Peninsula. The balance of the Rights Issue proceeds will be used for capital expenditure and working capital requirements of the MTD Group of Companies.
http://srilankastockpicks.blogspot.com/2010/12/mtd-walkers-plc-announce-rights-issue.html
We do not know about the numbers of the loans received for the acquisition of companies previously and the amount required to acquire Northern Power Company (Pvt) Ltd. However I would say major part of the loan will be settled from the right issue. Hence Finance cost amounts Rs.67Mn will be reduced and this would strengthen the bottom line. This scenario will highlight only on 4th quarter results.
Let us workout the utilization of right issue
Total Proceeds From Rights ----------------- ----------Rs. 3,585,096,339
Interest Bearing loans---------------------------------- Rs. 849,770,754
Non Interest Bearing loans--------------------------- Rs. 3,597,928,709 ( this may be received from related company to acquire the company , stated in the propose of right issue)
Overdraft ------------------------------------------------ Rs. 311,689,918
Total Borrowings --------------------------------------- Rs. 4,759,389,381
We do not the company preference to settle the loan facility. As stated in the purposes of right issue announcement, part of non interest bearing loan will be settled from the right issue proceeds and part of interest bearing loan also will be settled…
We can see only the restructured and sound balance sheet from the 4th quarter by reflecting above numbers. Further income generate from new projects (mentioned in previous) also will contribute to strengthen the company performance and value…
Keep on Investing in growth sectors……
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