PC Jewellers


(ranviraaj) #701

Intimation of opening of new showroom at Rewa (Madhya Pradesh).

I think it looks like Business as usual for PC jewellers only investors are worried??


(Satyamtaneja) #702

The spelling of “InveRstors” though…


(Satyamtaneja) #703

Apparently this turned out to be true. Company has scheduled a conference call at 5PM to explain the results. Lets see how much the stock shoots.


(vikas sinha) #704

Q1 results not bad
5% PAT increase YoY
20% PAT increase QoQ
OPM down


(vikas sinha) #705

Management presentation on results:


(LTInvestor) #706

Results update:

I will not spend time on profitability as that is not the concern about PCJ. Besides at Rs. 15 annualised EPS the company is trading at 6x PE at which growth is irrelevant when it comes to deciding whether to invest or not. The only thing important is if the company is real or fake. So coming back to cash and debt.

1. There are lapses in disclosure this quarter and I think it is mostly because B/S has become weaker.

a.) As of 31/3/18 - cash in hand was 1492Cr and they mentioned 417Cr as TR realised post 31/3/18. With a cash profit of 147cr + inventory decline of 319cr, end of quarter cash balances should have been 2375Cr before repaying payables.

b.) However cash in hand is shown as 1162Cr after repaying 426cr to banks and increase of 105Cr of Operational Creditors, so actual end of quarter cash balances was 1693Cr or a shortfall of 682Cr from what is should have been.

c.) Most likely TR realised was used back in the export business leaving 265Cr of unaccounted cash spent. With franchisees been set-up, this must be TR in domestic business. Or maybe loans to franchisee (red-flag)

2. Does not look gross bank debt has not been reduced and the reason is because they do not have the capacity.

a.) In the call they mentioned 3000Cr of Gold loan and 1000Cr of gross debt. Given that 1100Cr was gross debt as of 31/3/18 means that of the 426Cr repayment only 100Cr was for gross debt.

b.) My sense is with everything going on, banks are asking for more collateral against their gold loan and hence FDs created in the banks for the gold loan, leaving only few hundred crores to actually repay debt. Not sure how they will reduce further debt by 1000Cr if most the cash is going as collateral.

c.) This also ties with banks not giving NOC for buyback as there was no capacity in the first place.

Overall, business looks genuine but any further improvement in B/S should not be expected. Should trade at 12-13x atleast.

Disc: Holding at 110 levels.


(skapoor) #710

The Curious Case of PC Jewellers’ Trade Receivables (Thread)


(LTInvestor) #711

Amit Mantri is a top market guru, so he maybe having insider track on this. But in today’s environment where bankers are getting arrested and fired, very difficult to believe that banks have extended a line of 1000Cr and gold loan of 3000Cr to a company faking sales and ramping receivables. Do not think there is another 4000Cr scam out there. That said “India hai, kuch bhi ho sakta hai”, but chances are very low.


(Cshar) #712

Most undercooked and baised tweet by amit mantri, even there are 1000 cr receivables 100 rupees not justified. Export rose 800 cr from 350 cr from march to june quarter hence receiable will rise where is issue.


(jajushobhit) #713

Another reason for increase in receivables in my opinion is because of accounting of sales. The sale is recognized when goods are sold to the franchise and not at actual sale to customer. As the company is now expanding through franchisee model, it is not surprising to see the no. go up. But the sales no’s should be taken with a pinch of salt.

Regards
SJ


(neopandit) #714

I do not know for sure but will shifting of a couple of stores to bigger sizes / better locations make the fixed assets grow? Amit Mantri discloses he doesn’t have a position in PCJ then why would he spend so much time in this conspiracy theory. Is he a Supari theoretician? (p.s. Got it. He is a PMS manager. So, no direct interest). As long as PCJ management keeps acting like Alice in Wonderland (“we do not have TR numbers for the quarter” ) then people like Amit Mantri will exploit the situation to the max. So, I will not blame him.
I am not able to understand the motive of management in maintaining chaos. Perhaps since they know all the information and can control the final outcome, they think chaos is useful for them to make some income on the side. Basically acting as “God” of the PCJ shares. That has never worked for anyone but everyone tries never the less.
What could be the motive that the management is happy or at least unconcerned about 75% destruction in wealth? I refuse to accept the arguments such as "the management being first generation management was not able to understand the impact …." (concall Q4 FY18) or that they are just “unpolished diamonds”- pun intended - as some of us tend to believe.
Something is not right here.
Is that something already priced in or are there some dirty secrets still under the carpet? The management supported chaos is already reflected in the volatility of the stock price. Regards,


(manivannan.g) #715

There are lot of folks out there requesting for a look at PCJ kind of companies, for a normal/beginner guy like me won’t find those points at a first or second look.

In twitter, I too requested Amit to have a look at recent result whether it was investment worthy, due to management trying to paint a good picture post buyback fiasco.

Not only him, there are lot of boarders post such analysis, which is for pure learning experience. In this forum @phreakv6 used to post in vakrangee, sanwaria, 8kmiles etc. Definitely helps newbies and I find those posts genuine.


(neopandit) #716

valuepickr was recommended to me by phreak (from mmb, Suzlon) :smiley: Thanks for clarifying about Amit Mantri. Regards,