LEEL has been rangebound in a bull market. Will this news impact it further? Or being a B2B player, it will not be impacted?
LEEL has been extremely weak throughout this quarter and is trading at its 52 week low. What is the expectation on June quarter results with the GST overhang? Iâm looking to average but I think June quarter will be a good indicator of things to come.
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I think the topline for June quarter should be good, but due to onset of GST they might have taken a hit on their margins just like most of the companies not only in white goods sector but other industries as well. No doubt June quarter results will give a better picture but current price seems attractive enough to average. I personally am thinking to average at cmp.
P.S- have put in a buy order in morning but hasnât executed as yet. (boarders if disclosing this is wrong please forgive me and let me know of my mistake)
Well, the thing to really look out for is what they end up doing with the proceeds from the Havells sale. If they do indeed deleverage their balance sheet, this is a bargain buy now. Hopefully they dont become too ambitious and deploy the proceeds in an unrelated area.
By the way, anyone know of any risks on their b2b business?
Disc : Invested
In the concall they had indicated tht they would deleverage balance sheet
Disc : Invested and adding in small quantities
Hereâs a technical analysis on LEEL along with the source of information:
Have not yet received the dividendâŚchecked with my broker pool account tooâŚamount not yet creditedâŚany information on how to go aboutâŚ?
You can write to Lloyds investor cell. They can check and confirm the status.
LEEL q1 results on August 10. Considering debt reduction and GST implementation, what are the expectations?
Can any share the inputs from results?
Results in itself are on expected lines - infact good I would say. If we exclude the consumer durables business, EBITDA is 43 Cr.
Whats not very clear is the consideration of the cash from the Havells sale - 1550 Cr. Their notes say that they havent taken that into account this quarter due to pending closing adjustments. Not very sure what this means. I had a look at the Fedders Electric results as well and their share of the sale proceeds ( 50 Cr ) is factored in. If Fedders could account for it, not sure why LEEL could not. We may need to wait till the AGM to get more details.
Another point to note - finance cost came down from 38 Cr last quarter to 21 this quarter. This implies they might have paid back a large part of the debt but we need to wait for the confirmation.
Net net - unless thereâs a big unknowable here, this stock is available at a bargain. Need to keep a close watch though.
Disc - Invested
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How do you interpret increase in inventories of finished goods , wip, stock in trade at 341 crs. Approx ?
Well, thats in line with the corresponding reduction in cost of materials. They obviously wouldnt have bought any new materials due to the sale of business this quarter. If you look at the sum total of the cost of materials and the inventories of finished goods, its in line with the costs incurred in the past.
Unless I am missing something?
Sandeep: what do think of Heat Exchange segment results. While revenue increased 15%, profit declined 15% between Q1 18 and Q1 17. With CD segment sold, this could be a serious drag on the company, no?
Huge change of momentum for LEEL. And still going strong. Any news about the big movement? Other than SPTâs endorsements!
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Might be due to Dixon IPO which is at 40pe which is into similar OEM and ODM manufacturer for consumer durables.
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momentum has started with SPTâs endorsement and then with Dixonâs IPO.
I would not compare Dixon with LEEL, mainly because of the difference in product portfolio
Dixon produces wide range of consumer electronics items like LED TVs, washing machines, LED bulbs and tubelights, downlighters and CFL bulbs, and mobile phones.
where as LEEL is into production heat exchangers and ACs OEM supplier.
LEEL may run till IPO of Dixon and few days after.
I have invested for short term in LEEL
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LEEL just became my second largest holding due to recent rally. I believe euphoria around Dixon could force market to recognize LEELâs potential (20-35x P/E), although weak margins remain Lloydâ achilles heel.
At CMP, LEEL trades at 15x trailing earnings (debt free company though, so some respite there), which is undervalued for a company growing at 20%+, however, it is more than fairly valued (almost overvalued) for LEELâs ultra low RoE, which is the reason it used to languish at such valuations. I expect the rally to continue in the short term given the huge P/E differential, much like Relaxoâs high P/E has increased Batas, but Iâm not super bullish about the remaining business given low RoE.
I think the important factor going forward is to understand the businessâs incremental RoE, and exit if < 12-15%
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I havrnt done the calculations but given the fact that no advertising and no debt to repay, shouldnât the RoE increase in the coming years?