Mandhana Industries - Demerger

why don’t we discuss… can the books be cooked ?? what are the chances

as of 31 mar 16
Promoter holding was about 72% and pledge abt 31%
after Mar 16 - Promoters have pledged roughly about 19% more, so total pledging about 50%.

Sales of textile business as on Mar 16 was 1400 cr +.
Receivables about 529 cr.
Debt 840 cr +

Can the experts advise if it possible to cook the sales fig and by how much.
one way to forge the sales is to supply the products to the dealer or consignee and book the sales. That will increase the receivables.

Is there any way to find if the inventory is real or not.
inventory is about 500 cr+ and since it is in textile / fashion business the inventory worth might turn out to be much less.

As per random calculation, if i consider sales of textile business of 1400 cr and remove receivables of about 400 cr, considering real sales of only 1000 cr .
Assuming that the business is poorly run considering the quality and pledging by promoters. it should still be worth atlas 25% of sales , i.e 250 cr.

Prior to the start of lower circuit the promoter director who is a brother of the MD resigned on 11th June. What coincidence!!!

http://www.bseindia.com/corporates/anndet_new.aspx?newsid=303bbdfd-a702-47aa-8d0b-c96fe390b057

@manojag that too on account of his ailing health. Something wrong going with management.

Being Human is a big brand now, Its available at every mall and store, also it has big presence online too.
Seems the promoters have messed up big time. I see huge stock of this brand in Malls, huge inventory they have. why are the promoters not clarifying the issues related to signing agreement and the debt and receivable on the books?

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@go4sheel
If someone come across with Being Human retail store, please find out politely who is supplying the Garments ( or kind of long term supply contract ) and if the store people sense any tussle or issue with regard to Mandhana.

Just to get a feeling of ‘All is well’ between Mandhana and Being Human Retail stores.

I need to take decision to put more money to average the buy price ( 315 ). If things looks not good then pouring more money is not a wise decision.

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Care downgrades Mandhana Industries to default
Care has also downgraded its non-convertible debentures worth Rs77 crore to ‘Care C’ rating from ‘BBB+’ rating

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Looks like the company is going to bankrupt.

@AxisVarun How are you able to get this news so quickly? I mean, Do you use any tools and anything else?

IIFL trading terminal…under news segment of respective stocks.

‘Bankruptcy’ - seems climax is visible. My investment in Mandhana is becoming NPA !

How can the company with a manufacturing base and established business go bankrupt within a month? Even Satyam managed to avoid an NPA situation for its investors.

It really is some thinking fodder, isn’t it?
If it has become genuinely bankrupt overnight (which, I also think, is highly unlikely), we need to analyse it more and understand the attributes so that such companies don’t eat into our investments in the future.
On the other hand, if it is just a huge over-reaction of Mr. Market, we need to decide and make-up our minds, now, to take action and swoop like an eagle at the first hint of a turn-around. Is anyone up for some scuttlebutt??
DISC: Tracking keenly; Not invested yet.

Exactly @devansh_god , being human only contribute 10% of the revenue of Mandhana. So even if it get out of business that doesn’t make it drop by more than 80%.
It’s just a market situation. Everybody want to sell off their shares ASAP. Lack of unity.

And as per opinion, even a single positive news will pull up the stock (may be upper circuit). There are many like you and me, waiting for that movement.

I’m thinking to enter this stock at around 35. What’s your opinion?

Also when is the company’s next meeting announcement will happen (date)? Might the day before will be the great time to invest.

What if it goes the same way it did for Ricoh India?
You cannot rule out financial irregularities in such a scenario. Promoters are incurring more losses than any of us; why wouldn’t they purchase from the market or provide clarification if they were confident of the business?

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its trading at M cap of approx 170 crores…seems v cheap , still no buying from promoters…what is the reason…their is seems to be something wrong , which is hidden.

Has anyone tried to contact Investor Relations?
I am not holding so i cannot…
If any one has tried recently in last week or so…can you update

All debt downgraded to junk

As of March 2016, the company has total standalone debt of Rs.846.88 crore.

The shares of textile and apparel manufacturing company had fallen over 81.86% in the last 24 consecutive trading sessions on the back of higher volumes. The stock has been hitting the lower circuit in the last 23 consecutive sessions after a demerger announcement.

So has it been demerged, if not does anyone know of the record date.

But, a savage fall like this can’t be only due to an event which has such a minority effect on the top & bottom lines. We should also be humble to the possibility that there may be more information not in the public domain which we are not aware of.

Now, THAT is a million dollar question. Maybe, they foresee a much lower price than CMP (if they intend to buy). Or they’re secretly offloading too (if everything is a big fraud).

Prompt corporate filing by the company…shareholding pattern - end of June-2016.

Regarding ‘why promoters not buying in open market’, they already upto the limit…72.65 %. Maximum allowed is 75%.

Recently Walchandnagar Inds Ratings has been downgraded to ‘Default’ by CARE but market punished just 4 or 5% downside…then become normal trading then onwards.

All we need is - no major issue with Being Human Retail and retain with the company ( which is not possible as court approved the demerger ) or announce the record date for the demerger to pave the way for escape route for retail investor from huge loss ( am one of them ). I sincerely believe Beinghuman Retail have huge value.

Out of box thinking - it would be so nice if Aditya Birla Fashion and Retail or any such big house take over the company in complete.

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Pledge detail - June - 2016

Pledge detail - March - 2016

So, by this time the promoters might have pledged 100% !

How much % is it of the total sales? I I don’t think Being Human was 80% of Mandhana’s market cap which has been eroded away without a confirmation of cancellation of contract.

Also I believe 2-3 banks/ fund houses who had the pledged shares sold off around rs. 71 and someone lapped them up. Could it be the promoters themselves?