Has anyone been able to find out the working capital requirement of different business units/verticals within Cox & Kings. Clearly, the debt situation is not improving at very high rate due to working capital requirements.
Intuitively, I thought they had negative working capital business. People pay in advance for the travel bookings and they can negotiate better payment terms with airlines/hotels.
The results are quite poor, but the balance sheet looks even worse. Despite all promises, the debt (excluding current maturities) has increased by ~Rs. 483 cr. Based on my rough calculation, the CFOA will is in range of -100 cr to -150 cr. This company undertakes so many restructurings, that it is impossible to evaluate the performance, and finally results in the increase in debt and goodwill. Not very optimistic about the stock.
Disc:Invested
SJ
There is lot of equity dilution, hence ROE will always be low, better to avoid.
The results are out. Though optically the results look decent. I am still not enthused about the prospects of the company. There was a disproportionate increase in expenses in Q4 FY18, including finance cost. Is the company resorting to accounting creativity to improve results of the few quarters to improve sentiments and taking a hit in one quarter. There is no action on the reduction of debt. In fact FY18 finance cost is more than FY17 finance cost.
Regards
SJ
Sale out value is more than current market cap of the company as well as debt amount.
Seems like a good enough trigger for a rerating.
Moreover, listing of financial arm should also boost the share value.
CKFSL ( financial services ) ex date for eligibility was 25 Oct in ratio of one CKFSL share of FV 10 for 3 CK shares ( FV 5 ).
One can now invest in CKFSL only on its listing.
Is anyone tracking cox and kings? Why is it not moving in spite of the education business sale for a good amount? We can also see the effects of debt reduction in coming quarters. Yet its not moving even when other small cap stocks are running
Results seems to be great even after excluding extraordinary gains from business sale. Yet the stock is not moving. Anyone has an idea what’s happening here?
Is something terribly wrong with Cox&Kings down from ~200 levels to ~80 levels in few months?
Even I have been concerned about the steady drop in the prices. Not sure, but does the rbi proposal to have forex trading platform for retail investors have any impact on the business ?
Blockquote
Given the company has demerged this division, the impact of the above forex changes should be minimal on the company.
The drop in price is appalling, specially given the reduction in debt number and higher profitability figures. This is obviously worrying considering the number of frauds that have been cropping up in the markets.
Is any reason for rampant fall in the stock price ?
They sold the education division for roughly 4000 crore and said debt will reduce by 60%. But reduction in debt has been only 1000 crore, roughly 25%. I guess market is again worried about money diversion from sale proceed. Similar to the way stocks of LEEL and Prabhat dairy crashed. Management should give exact details of fund utilization to stop this fall.
Company doesn’t look trustworthy . In cox and king financial the recent demerged company the current results gives bad feelings .
C&K has high promoter pledge … and about 49.6 % stake… 40 % is held by institutions and about only 5 % by individuals… no mutual fund holding…
Since past two months there is consistent selling on the counter which saw price drop to INR 48 from INR 150 or so… today LC with high volume and good delivery. IMHO as there is no disclosure of promoter selling off late the fall seems to be due to selling by Institutional holders…
It is not as bad a company if you take the latest credit rating report of ICRA released few days ago…
But why such a fall… anything wrong which has not become public till date? Or can it be an opportunity…
requesting views of learned members…
Very high level of debts and they are struggling to repay and service it. May default as they have approached a number of financiers but are not getting any new funds.
They have 1800Cr of cash. Only fear in market is promoters siphoning funds from sale proceeds to repay own loans.
Cox management indicating that there was an cash flow mismatch and failed to pay 150 cr on time and hence defaulted…My question why they could not use Cash and equivalents ? Is the cash received from asset sale available to the company ? Also how much of 2300 cr receivables can actually be realized ?
I am now doubting the management of this old, well established and good Brand name company…
Old article on mismanagement by Cox & Kings
And a follow-up
