LFIN or LHCL - Short term gain more?!!

_livestrong_ · 1 LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 4:07 pm

_livestrong_

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Which share will have the highest gain within 1 months time?

Teller · 2 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 4:24 pm

Teller

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If LFIN reach 160, then the return will be
35/160 = 21%

If LHCL reach 70/-, the return will be
14/56*100 = 25%

LFIN almost had some appreciations in recent rally.
You can buy 2.5 shares of LHCL which is equal 1 LFIN

In this case you can earn multiple profit as you invested more shares. Pls note less brokerage will drive a lower cost.

SUSPENS · 3 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 4:43 pm

SUSPENS

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LHCL still we are in the start of the journey...

So most of pp like to sell and exit in little profit...

But when the middle of the journey no selling at all..

Like LFIN..........so wait and see this hospital really....First time in the 2015

Teller · 4 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 7:02 pm

Teller

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You are correct mr.suspens. some people looks exit with a minimum margin because they dont have any trust on their holdings while people are changing their value shares to SCRAPS. in very very short time LHCL will pass 70/-. once it reaches to 60 then it will speed up the game. Intelligence players never show much demand in order books. They are accumilating shares in very peacefully. Once collection is finished it will bullish nicely.

Last edited by Teller on Tue Aug 11, 2015 7:11 pm; edited 1 time in total (Reason for editing : typing error)

kumarweerarathne · 5 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 7:04 pm

kumarweerarathne

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Im also so hopeful on these two counters exept poultry. LFIN again showing its further uptrend towards 150 mark today. But LHCL is still on its start mark can expect strong run. Very Happy

ONTHEMONEY · 6 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 9:18 pm

ONTHEMONEY

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Hi Guys,

I need a clarification on LHCL valuation?

The groups EPS for the six months ending 30.06.2015 is 1.66 times. (annualized - Rs 3.32). How can we value @ Rs 70/- and under what PE? Yes it is a growing counter and the leading hospital.

I my view we have to consider a market accepted PE to minimize the risk.(Generally @ 10 or 15 times) However certain counters trade at higher prices such as COMB,JKH,etc.

The Group Profit Before Tax (PBT) of Lanka Hospitals Corporation stood at Rs.428 million for the first six months of the financial year 2015. This was an 81 percent increase compared to Rs. 236 million recorded in the corresponding period of the financial year 2014.

The last 5 years dividends payouts of LHCL are as follows;

SecurityID

Name

Type

Description

Proportion

Dividend
(Rs)

Quarter

Announced
date

Price prior to
Anno.dt

Current/EX
Price

Price
Change

EX Date

Payment

LHCLN0000

Lanka Hospitals

D

Dividend

0.50

Final

18-May-2012

29.20

29.50

0.30

02-Jul-2012

10-Jul

LHCLN0000

Lanka Hospitals

D

Dividend

0.50

Final

21-May-2013

43.60

42.00

-1.60

30-May-2013

10-Jun

LHCLN0000

Lanka Hospitals

D

Dividend

1.50

Interim

02-Dec-2013

41.60

42.70

1.10

10-Dec-2013

20-Dec

LHCLN0000

Lanka Hospitals

D

Dividend

0.50

Interim

02-Dec-2014

49.90

49.00

-0.90

10-Dec-2014

18-Dec

LHCLN0000

Lanka Hospitals

D

Dividend

0.50

Final

08-Jun-2015

41.90

44.50

2.60

17-Jun-2015

Pls share your ideas!!!

ONTHEMONEY · 7 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 10:21 pm

ONTHEMONEY

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Hi Guys,

Compared to LHCL,LFIN please asses the following;

SecurityID

Name

Type

Description

Proportion

Dividend
(Rs)

Quarter

Announced
date

Price prior to
Anno.dt

Current/EX
Price

Price
Change

EX Date

Payment
date

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

1.00

Interim

21-Mar-2006

83.00

85.00

2.00

30-Mar-2006

12-Apr

LFINN0000

LB Finance

B

[b][b]Bonus[/b][/b]

[b][b]2 for 5[/b][/b]

15-Aug-2006

79.75

52.25

-27.50

09-Oct-2006

LFINN0000

LB Finance

R

[b][b]Rights[/b][/b]

[b][b]1 for 2 @17.00[/b][/b]

19-Sep-2007

41.50

25.00

-16.50

28-Nov-2007

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

2.25

1st & Final

02-Jun-2008

22.75

19.25

-3.50

29-Jul-2008

04-Aug

LFINN0000

LB Finance

R

[b][b]Rights[/b][/b]

[b][b]1 for 7 @17.00[/b][/b]

02-Jun-2008

22.75

19.25

-3.50

29-Jul-2008

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

3.00

1st & Final

26-May-2009

22.50

36.00

13.50

01-Jul-2009

10-Jul

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

5.00

Interim

29-Apr-2010

94.25

88.00

-6.25

07-May-2010

18-May

LFINN0000

LB Finance

B

[b][b]Bonus[/b][/b]

[b][b]1 for 1[/b][/b]

12-Jan-2011

309.40

147.10

-162.30

07-Mar-2011

View

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

3.50

1st & Final

08-Jun-2011

185.00

175.80

-9.20

01-Jul-2011

07-Jul

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

5.00

1st & Final

08-Jun-2012

100.00

121.20

21.20

02-Jul-2012

09-Jul

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

6.50

1st & Final

03-Jun-2013

129.90

123.00

-6.90

01-Jul-2013

09-Jul

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

6.50

1st & Final

02-Jun-2014

116.00

123.80

7.80

01-Jul-2014

09-Jul

LFINN0000

LB Finance

D

[b][b]Dividend[/b][/b]

10.00

1st & Final

22-May-2015

202.00

224.60

22.60

02-Jul-2015

10-Jul

LFINN0000

LB Finance

S

[b][b]Sub-Division[/b][/b]

[b][b]1 INTO 2[/b][/b]

20-May-2015

185.90

226.60

40.70

09-Jul-2015

The company has gradually increased its Dividend payout ratio during the history and EPS is Rs 5.6 for 1Q 2015.(Annualized - Rs 22.4). Hence the PE is 6.0 times.

Therefore if we calculate the expected market value of LFIN @ following PE levels;

Market PE @ 8 = Rs 179.2
Market PE @10 = Rs 224.0
Sector PE @ 12.93 = Rs 289.63

Therefore in the worse case any investor would be in the safe side since it is trading at a PE of 6 times.

Further LFIN maintaining a diversified portfolio of business. It contains Leasing/hire purchase, Islamic Financing, Mortgage Loans, Factoring, Micro Finance, Pawning, Margin Trading, etc. Also recently company has introduced an innovative product to capture an untapped market of informal money lenders @ a lower rate. I guess this would bombard the market @ lower rate compared to informal lenders with aggressive marketing strategies of LFIN coupled with riders recoveries at business points. This is first time a bank or a finance company approached this market.

Company has made losses with Gold pawning business during 2012. However company now have diversified its portfolio to minimize the risk. Currently LFIN concentrates only 8%-10% on pawning business out of their total advances portfolio. Hence diminishing Gold rate in global market is less impact-full compared to 2012. Further global gold rates are at the rock /bottom since 1970.

Further LFIN main business is leasing. During 2014, the imports of electric hybrid vehicles to Sri Lanka accelerated by 175% in terms of volume and 223% in terms of value. Reduction of duties for hybrid electric vehicles during 2014 was the reason for this boom. Japan is the major import source ofhybrid electric motor cars to Sri Lanka accounting for more than 95% of the market followed by Germany.

Hybrid Vehicles imports during 2010-2014(Source - Chamber of Commerce)

Year	Volume(No)	Value(Rs/Mn)
2010	438.00	980.00
2011	5,927.00	14,440.00
2012	1,943.00	5,439.00
2013	9,707.00	20,430.00
2014	26,729.00	66,004.00

This indicates the potential of the business and the trends for demand for hybrid vehicles has continues in 2015 as well.

Therefore considering the above facts I would like to recommend LFIN as a highly undervalue counter with high potential. Many investment funds, corporate investors eye as a medium/Long term investment due to its earnings potential and Dividend Yield .

In my purview LFIN would be the next SDB....!

Happy Investments

Teller · 8 Re: LFIN or LHCL - Short term gain more?!! Tue Aug 11, 2015 11:30 pm

Teller

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@Onthemoney,Banking and finance companies are trading attractive sector PERs.finance sector PER stands 10-15.and mostly sector PER decides by market leaders in its indistry. As an example NEST can do a big infuence to decide the sector PER for food compsnies. As example Food companies sector per around 25xhotel sector 45x in hospitals 20-22.5 x. So sector PERs are changing sector to sector. We cant compare finance companies with hotels. Bank and finance companies are high risk counters,highest earnings very less assets base so attractive sector PERs are there. Hospitals and hotels have more assets as well as less earnings but higher good will and existance. So those are considered as less risk businesses. Attractive finance companies can collapse any time but other sectors can be considered as more stable. Typically world hospitals are trading above 35 x sector PERs. That may be the reason one of indian private hospitals baught LHCL above 100 rupees in years ago.

soileconomy · 9 Re: LFIN or LHCL - Short term gain more?!! Wed Aug 12, 2015 6:55 am

soileconomy

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Teller wrote:@Onthemoney,Banking and finance companies are trading attractive sector PERs.finance sector PER stands 10-15.and mostly sector PER decides by market leaders in its indistry. As an example NEST can do a big infuence to decide the sector PER for food compsnies. As example Food companies sector per around 25xhotel sector 45x in hospitals 20-22.5 x. So sector PERs are changing sector to sector. We cant compare finance companies with hotels. Bank and finance companies are high risk counters,highest earnings very less assets base so attractive sector PERs are there. Hospitals and hotels have more assets as well as less earnings but higher good will and existance. So those are considered as less risk businesses. Attractive finance companies can collapse any time but other sectors can be considered as more stable. Typically world hospitals are trading above 35 x sector PERs. That may be the reason one of indian private hospitals baught LHCL above 100 rupees in years ago.

Teller .They (Indians) bought at Rs 60.