Why KGAL PER is low?

Hawk Eye · 1 Why KGAL PER is low? Mon Jul 04, 2011 12:50 pm

Hawk Eye

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Can anyone explain why KGAL PER is 5.3 and the Plantation sector PER 14 ?

Monster · 2 Re: Why KGAL PER is low? Mon Jul 04, 2011 1:07 pm

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Not only KGAL but HOPL, MAL and BALA also currently trading lower PER. Since the earnings on this sector is volatile, PE ratio is 14 is too much for this sector. But it should at least trade at PE ratio 10.

kam2011 · 3 Re: Why KGAL PER is low? Mon Jul 04, 2011 1:15 pm

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Monster, KGAL current price is 182.00 and EPS last financial year(ending 31.03.2011) is Rs.33.66. Accordingly PE is 182.00/33.66= 5.40. I think this is the third lowest in the Plantation sector. Lowest is MAL(4.30) and 2nd lowest is HOPL(4.90).

Monster · 4 Re: Why KGAL PER is low? Mon Jul 04, 2011 1:57 pm

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kam2011 wrote:Monster, KGAL current price is 182.00 and EPS last financial year(ending 31.03.2011) is Rs.33.66. Accordingly PE is 182.00/33.66= 5.40. I think this is the third lowest in the Plantation sector. Lowest is MAL(4.30) and 2nd lowest is HOPL(4.90).

Totally agreed. I never said KGAL is not attractive. Though wages issue is concern, rubber price is still attractive. Therefor, these plantation should produce better results in this quarter too.

KGAL and HOPL are part of my portfolio.

Hawk Eye · 5 Re: Why KGAL PER is low? Mon Jul 04, 2011 2:07 pm

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According to the Financial Reports pg 84, for the last 10 years the PE is below 5.3. Recent valuaion by Asia Capital for 2012 and 2013 is base on PE 5.3 and 4.9 respectively on forecasted earning.

Is this because of Rubber