ValuePickr Forum

CMI Ltd - Specialized Cables manufacturer

Annual report is still not available for current year but came across this very detailed research report from crisil. have a read and feel free to make comments.

Crisil-Report-on-CMI-limited.pdf (776.0 KB)


Why AR still not available are they are not obligated to provide AR by some stipulate time? And AGM is in December, did they taken special permission for that, I always wondering management quality in this company. Anybody knows company well let me know what is the issue with AR and annual report?

There is a notifiction that general meeting will be delayed by 2 months … Any idea about this …

They had same problem last year too, released it somewhere around December 26th or so, told the reason was because of amalgamation on Cmi Ltd and Cmi baddi plant, they were waiting for the approval, which dint got on time as per their expectation

Any reason why there is steep fall in price or just market hammer any change in fundamental of company

Does any one has concall for today’s meething?

Merger of CMI with acquired subsidiary is nearing completion. Order reserved by NCLT Principal Bench on 5 Feb 2019.

Several developments at CMI recently so I thought it will be useful to write up a quick summary:

  1. 05 Sep 2018 - Baddi plant gets vendor approval from Indian Railways.
  2. 21 Dec 2018 - Wins 79 crore order from BHEL, first such large overseas project with BHEL.
  3. 04 Jan 2019 - Wins 21 crore order from Eastern Railways for Baddi plant.
  4. 18 Jan 2019 - Crisil upgrades credit rating to BBB Positive.
  5. 12 Mar 2019 - Wins first export order from Mauritius.
  6. 14 Mar 2019 - Baddi plant gets vendor approval from Power Grid, Airports Authority of India, Mazgaon Dock and JNPT.

Disc. Invested.

Merger of CMI with acquired subsidiary approved by NCLT yesterday.


Apart from this, technically it looks like a good opportunity to buy this gem at almost all time low.

Disclaimer: Was lightly invested; have already added more before sharing the view. Therefore, you are free to consider this a biased opinion.


Benefit coming mainly from tax saving.

Yes, but that is a benefit. Isn’t it?

As per my understanding, this is due to Unabsorbed Depreciation related to Baddi plant.


Apart from this,

  • PBT and Revenue numbers are also increasing YoY.
  • Price is less than book value and Graham number.
  • Cash reserve is more than market-cap.
  • while the price is at an all-time low - making it an attractive buy.

Enough red flags in the company.

  1. Contingent liability of Rs.109 crore in FY18.
  2. Balance sheet is very dark. Receivables of Rs.273 crore. This is putting stress on short-term borrowings.
  3. Interest and finance charges of Rs.33 crore for FY19.
  4. EBITDA of Rs.87 crore in FY19 includes other income of Rs.14 crore. What is the source? It doesn’t have more than Rs.20 crore in cash, so it is surely not interest income.
  5. Related party transactions are scary. Purchase of Rs.23 crore from Dhruv Cables. Sales of Rs.41 crore to Parshwanath Cables. They could over and under invoice for both. Plus recoverability might be an issue.
  6. Pledging 40% of Promoter holding. They were pledged at double the current price. Cover might be low. Lenders might invoke selling in open market if margin shortfall unfunded.

One good part about the company rather two -

  1. Capacity in place. Cash flows from here to turn positive. It needs to take of WC issues.
  2. Private capex is stalled. Govt. capex is strong. Railways and SEB’s doing their bit. This should keep the demand strong.

any update why cmi is falling like this looking at the stock movement it looks like it is heading towards penny stock any specific reason for such a big fall?