G M Breweries..are we ignoring its potential?

(bindulshah) #24

i would like to know current situation on GM BREW and future price growth from here 2016

(Kumar Saurabh) #26

@admins I believe such posts for price guidance should not be entertained . Lowers the quality of discussion .

(Bheeshma Sanghani) #27

Some numbers

If you look at the growth in the net operating assets of the company its about 6% over a 10 year period and the growth in sales is 8.76% , while the growth in PAT is 19.35%. The company was struggling to extract returns from capital during 2009 to 2013. Even during these trying times it managed to recover its cost of capital ( which I think is around 10 to 11%) except for one year (2010). Over a span of 10 years not only it has consistently recovered its cost of capital but exceeded it by a wide margin

(Bheeshma Sanghani) #28

GM Breweries is showing some interesting trends in prodn numbers.

Capacity utilization has increased from 42% in 2010 to 46.15% in 2016 indicating robust demand for its products. The March17 AR is not out yet.

The %prodn in PET bottles has also increased substantially since 2010 adding to the margins.

Post demonetization and 500 mtr bans it would be interesting to see the the numbers of both cap utilization and % prdn in PET bottles and evaluate the impact.

It is important to note that Shiv Sena dominates the Thane Municipal Corporation with 67 seats in 2017 which have increased from 54 in the previous election.

GM is poised interestingly.

Disc - Invested recently

(jatinmakkar1993) #29

This company is always the earliest to post its result every quarter even before the IT companies announce their results. I think it is habit of a good management. Anways the results are normal, no improvement.

(Vshah198510) #30

One positive I could identify is:
A non-current investment in tax free bonds : 38 crore

Assuming a 8% rate it will add 3 cr to the bottomline every year non-taxable.

Not a great way to compound like the VPers but still adds 7.5 percent to last years post tax 41 cr profits.

But company’s very hidden about which tax free bonds they have applied in. No mention in the AR.