As per Admin’s request am re-posting my previous query as - is:
Any views on Core Education & Technologies with shares falling down from Rs. 288 on Feb 25 to Rs. 60 today? Consolidated Book Value at end of Sep 2012 Q is 1,790 crores or about Rs. 160.
Sounds like fundamentally company has no issues. Half year consolidated EPS @ Rs. 13.33 and last year FY 2012 EPS at 28.
Further management released this statement yesterday:CORE Education & Technologies Ltd has informed BSE that:
"CORE Education & Technologies Ltd., are listed on the BSE 500 Index under the symbol COREEDUTEC within Group A.
The Companyâs scrip witnessed unusually high volumes of trading along with a steep fall in the share price today.
In reference to the same, we would like to clarify that none of the shares that the Company has pledged with financial institutions has been sold and the Company has confirmed with all the financial institutions that they continue to hold the same. The Companyâs business model continues to be intact with its strong order book of around Rs. 1,000 crores from India spanning across next 5 years and about Rs. 540 crores from USA."
I hope this is the correct place to post this query.
In the previous fall of 2009 I bought this on a friend’s tip when it had crashed due to FII selling. Bought at 49, 39 and 45 and sold first at 140 and remaining 210. Of course, I invested only a small amount. I am tempted to enter again below 50.
Reasoning is that it may not bounce to 300, but at least it should bounce back to 100. Of course it is a risky call and one can only take a small position. And here the learning at Valuepickr comes to mind, “If it is going to be a small proportion of the portfolio what difference would it make to overall returns? Then is it worth a bet?”
The Education industry is not a clean industry as we discussed in another thread.
There are disclosures that the pledged shares of the promoters have been invoked and sold in the market. IFCI was the biggest seller. This is the reason for the huge fall. Business troubles may follow due to the high debt that the company has.
Though the company maintains business as usual, I feel they could have liquidity problems.
The tangible book value (taking out items like goodwill) is about 60. Hence one needs to compare with this figure when we calculate P/B.
I still feel below 50 it is interesting. Also, it bounced back today from this level.