PC Jewellers

(Chirag) #308

If you consider the average PAT growth of the last 5 years then it comes to around 17% per year. And 5 years back the stock consolidate around 50 Rs for a long time. If you apply 17% CAGR on 50 Rs then we will get 110 Rs.

What I mean to say is, if there is no “Gitanjali-Gems-Type” issue with PCJ then 110 could be considered a “fair-value”.

But I would not buy PCJ at 110 on its way down, but rather on its way up.

(maheshkumar) #309


Bought today 0.25% of portfolio

(RedEPS) #310


(Mridul) #311

@LTInvestor @susindar They pay 3-3.5% on gold they lease from banks and others, which i think goes into interest cost. This is how they are insulated from inventory hits.

(manivannan.g) #312

Yes… Akash jain has recommended this on 18-April and today he gave the clarification for the same on Moneycontrol :

We gave a view on this company after analysing its fundamentals and business prospects. We were also surprised with the fall in its stock price. Before recommending it to anyone, we relied on the company’s profit and loss account, balance sheet and business prospects as presented by it in its analyst meet and investor presentations. Aggressive store expansion and the presence of auditors like Walker Chandiok & Co LLP gave us the impression that the company was on the right path. We always believe in recommending companies whose promoters’ integrity is not questionable.

(naruto) #313

How reputed is Akash Jain’s analysis/recommendation? Trying to understand if he is trying to give a contra point.

Discl: Not invested.

(manivannan.g) #314

Sorry, I’m not sure how to measure the reputation of the analysts who appear in MoneyControl, which includes Raamdeo of MOSL. Even MOSL has issued a buy rating with a target of Rs.650 in Jan-2018, before the Nirav Modi fiasco came into the light.

MOSL buy call in Moneycontrol: https://www.moneycontrol.com/news/business/stocks/buy-pc-jeweller-target-of-rs-645-motilal-oswal-2485101.html
Their research report (Date: Jan 20, 2018) : http://www.motilaloswal.com/site/rreports/636522086707624216.pdf

(Yashu) #315

PC Jeweller is trading at MC of 4363Cr at price of 110/-. The annual sale of PC jeweller is 8400Cr, and profit is 421Cr. So, company is trading at half the sale value and approx 10PE. The debt is around 650Cr and Cash on company books is around 1100 Cr. The company has reputed auditor Walker Chandiok & Co LLP, so it is hard to believe that figures are grossly wrong. The promoter shareholding is intact, with no pledging. There might be some issue of corporate governance as raised in previous post regarding gift of 2%, but such valuations for a strong retail business seems good to me.
Disclaimer: Invested today.

(svasa13) #316

Fidelity sold shares of PCJ worth 1.19%

(LTInvestor) #317

Thanks, I came to the same conclusion. 6% of 3000 of payables come to 180cr.

(ashutosh_shah) #318

This disclosure is for 27th April.

(suraj jethwani) #319

As Far as I can tell one reason of the Fall in PC Jewellers is due to FMR LLC (Fidelity) Sell-Off

24th April FMR LLC holding - 37,574,425 (9.53%)
27th April FMR LLC holding - 32,438,670 (8.23%) (no disclosure but interpreted)
02 May FMR LLC holding - 27,750,204 (7.04%)

Besides this Vakrangee has already sold off their Holdings bought at a High Price (Src: TV Interviews)

Now we can speculate based on above this has led to Panic amongst the Retail investors holding this Stock and they have contributed to the sell-off as well.

Promoter Holding continues to be 58.5 To 59 % (Src TV Interviews by Sanjeev Bhatia President Fin)

Disc: I tend to Short sell in cases like this, Might Buy PCJ on it’s way up.

(Radiozammy) #320

Yeah. So now we know who is selling. That at least solves some of the mystery and leaves us with the question - Why is Fidelity (a reputed financial house) with a sizeable approx 10% holding selling ? Also they bought about 26 lakh shares of PCJ (6% of their total holding previous to selling ) between Feb and April after the vakrangee news came out.( as per below article)

Disc:Invested, might add once volatility ceases.

(suraj jethwani) #321

You are Right Fidelity can hold if they wanted to , as I sure about their reputation.
They probably know some inside story that we don’t this is why i think they are selling off even though they bought at a High Price.
They are making HUGE losses here.

(atul1082) #322

Absolutely.If a reputed fund is selling left and right at a big loss, there is definitely some issue.Surprisingly nothing from sebi, auditors etc etc as to why it is happening while investors have lost almost 75% in vakrangee pcj and kwality

(Cshar) #323

Morgen stenly invested in Gitanjali in Jan, LiC holding both PCJ & Gitanjali. You are trying to say that Morgen stenly didn’t know what is happening in gitanjali. Don’t give much weightage to funds, there decisions are some times very foolish. PCJ is different from Vakarangee, kwality & Gitanjali. PCJ has 100 showrooms, 80 owned, & LT debt is 800 cr with total 3000 cr. They have done some small mistake by gifting 2% stake however shocked to see reaction from markets. Stock market is not an easy cakewalk. I am increasing my holdings in daily basis. It will boune back from next month.

(sandeep17) #324

There is news floating around since this morning about CBI investigating PC Jeweller and there is also unconfirmed news about Mr Balram Garg being arrested.

As i said, this is unconfirmed at the moment and could be just rumours - am posting this here since people who are long on this stock may want to dig into this and take appropriate action.

(Rohit) #325

From where did you got this news ? News channels ?

(sandeep17) #326

I dont really trust them so please apply due diligence.

(Utkarsh Pandey) #327