Trading Members of the Exchange are hereby informed that the under mentioned new securities of Mayur Uniquoters Limited (Scrip Code: 522249) are listed and permitted to trade in with effect fromThursday 16th August, 2012
Securities
54,13,200 Bonus Equity Shares of Rs. 10/- each allotted on August 8, 2012
Distinctive Numbers
5413201-10826400
These shares are pari passu with the old equity shares of the company.
In
case the Trading Members require any clarification on the subject
matter of the Notice, they may please contact the undersigned on Tel.
No.: (022) 2272 8242.
The allotted shares can be traded only from 16 August 2012.So the spike in shares prices could be due to auction of gullible investors who have sold off the shares a bit early.
I cant understand why you tend to see promoter connection here? the promoters have almost 74% stake in the company and they as almost three fourth owners would be more concerned by anything worrisome surrounding the company.
What is happening is that the company is being re rated which was long overdue. How far this re rating goes is anybodyâs guess as we say in case of ajanta.
**Just to take valuations into perspective, look at donaldâs projections for fy 13. Or for that simple matter, take a projected eps of around 36-38 per share which looks achievable looking at q1 fy 13 results. (72-78 as per pre bonus levels). Then ask yourself a simple question. Do you find the stock overvalued? **
If this question cannot be answered then its better to invest in mutual funds and let the MF manager worry his head about valuations and entry and exits
and promoter intent and their in lawâs intents and the fire in their belly and what not.
An interesting article in ET highlighting why Karolbagh leather dealers are switching to synthetic leather due to
)- Cheaper
)-
More durable
)- More colour variations
)- More designs that suit market trend
)- Low level of wastage which reduces manufacturing cost
)- Non uniformity of pure leather
This implies huge size of opportunity but almost all of the synthetic leather is being imported from China. What does this signify ? I think Mayur has withstood the threat from China die to consistence in quality in batch after batch and relationship with OEMs .
However China remains biggest threat to Mayur.
Coming to selling from Promoter In this thread itself some reputed boarder had mentioned promoter selling is a big risk for cos where their stake is as large as 75 %. Volumes have increased so this query could come in mind.
FIB is in IMHO the most essential quality for a entrepreneur which is present in abundance in Mayur Promoters n which has taken this co to the present level.
In these euphoric times caution is also essential .
Any updates on institutional/MF activities.Mr Adenwala had strongly recommended the scrip last month.
Why should one raise un-usual doubts? Look at the track recordâŚhere is a company which is doing really well and sharing wealth with shareholders. Infact if you will read my AGM note, then it was the finest AGM and set of promoters I came across!
Secondly, why do you think a promoter holding 75% shares will try selling his shares in open market? Its a complete suicide receipe.
Mayur has been a major wealth creator for all including me .
Thanks are due to Hitesh bhai, Nag Brahma and Donald for discovering this story.
Intent is for a healthy discussions on all aspects.
One of the biggest blemishes on Mayur promoter otherwise spotless corporate governance record I think was the way their stake touched 75 % due to themselves issuing the warrants at a ridiculously cheap price.The co started reaching the next orbits after this development .
Indian promoters issuing themselves warrant with only 25 % payment made and rest after 1 year or so is a big disservice to hapless Indian retail investors.MCA.all regulators have turned a blind eye to these shenanigans of large no o promoters.
I agree with Hitesh completely. The stock continues to look cheap not only in terms pf conventional multiples but dcf as well and it appears like we are going through rerating now. Another related possibility is maybe the knitted fabric plant has become operational (some portions in the 2012 AR mention that it was due to commence production in aug 2012) and maybe the stock is reacting in anticipation. But thats irrelevant.Of course, some wait and buy investors have been taken aback in this rally, but it doesnt seem like this is done with. We need to give this time and let the market worry and decide the valuations. What you need to ask yourself is whether you are a buyer/seller/hold at current levels and move on.
Vertigo seems apt for Mayur Uniquoters. What a rise n is it sustainable ?
Whatâs happening ? Heavy volumes comparatively. Who is selling ?
Could it be someone from promoter connection ?
if thatâs the case it may be a dangerous sign n froth taking over.
When you see heavy volumes. You need to see volumes with several other factors like deliveries, upward bias, downward bias or flattish. Promoter meddeling in the holding of the company etc.
Here promoter after attaining the 74.96% never takes any new positions or liquidate its positions. you can check for this for their shareholding pattern for many quaters. So this says promoters is minding their business and not playing with the movement.
last few days there have been high volumes with high deliveries with upward movement in the stock. Everthing is telling that even at this level there are people who are cleverly doing accumulation with minimal movement in price. And they were doing even between the 280-300 range.
People who have experience with the bonus stocks will tell you, generally companies takes 1-2 months to credit bonus shares to the investors account. the reason being they know it will lead to fresh supply of stock and price will come down which generally do happen. And most of the stocks are sluggish after ex date.
But here are promoters, you get your shares in less than 8 days of the ex-date. it speaks volumes about them. this tells about the confidence they have in their company fundamentals
valuation is something i would say is relative and subjective.
As far as mayur is concerned what i see, their fabric plant will go production in sept, which will lead to increase in margins. With the Rs 38 eps doing this year and a rerating which long due this should trade12+ PE comfortably in the next few months to come.
the biggest booster will come from signing the export contract with marque customers which mgmt is trying for few years. Probabaly we could see that in next 6-12 months time frame.
Again going back to the high volumes etc. Unless and until volumes are more than 10 times the average daily volumes and delieveries drop below 20% people should not be concerned.
Some of the other plastics related coâs I own have shown good results this qtr with an unusually high OPM(eg Supreme Industries). I guess that would be partly due to inventory gains. Wonder if Mayur did gain in any way due to cheaper inventory of raw materials ?
In any case stock is undervalued as you say & will continue to get re-rated as they scale up.
Disclosure: Remain happily invested in Mayur & Supreme Industries.
Making new highs almost every day in the past few days, Mayur seems to be in a free territory. However, the current mcap of 389 crores is higher than the managementâs projections of FY13 revenues (380 crores) and about 17% discount to FY14 revenues (470 crores). I donât recall Mayur being in a similar situation earlier. More often than not, it has lagged FY as well as TTM revenues, leave aside the projected revenues.
This might limit the immediate upside (but I will be surprised if the stock recoils without hitting the psychological 400 crores mcap figure (@ 370/share), post which psychological figure of 400/share will be the next milestone), but in the next 3-5 years, it should continue to be a compounder. In the past, Mayur has seen sufficient volatility to make possible an entry at lower levels, but it doesnât harm to add some now and keep on increasing the position with time.
This seems to be the case of rerating from being a domestic consumption story to exports story n that too to both OEM giants and replacement market. The margins in exports are thrice that of domestic.
With 50 being the new 40 and simultaneous appreciation of Yuan Mayur has become more competitive to Chinese cos in both exports n domestically.
No wonder even today at big volumes delivery % was 75. So who is the big guy making an entry into this secular growth story that we need to find out from all possible sources.
Valuations still attractive .how much should PE n marketcap expand to
Hitesh - this is well above 700 (840 pre-bonus; or about 20% higher than 700/share). Looks like a re-rating to me backed by some investor who is willing to pay for the future growth. However, this might slow down now (maybe kiss 500cr. and then come down a bit from there). What do you think?
If one is to stand by as long term investor who had a decent entry point here would you still recommend a complete Exit at 700 level(say in another 3 months or soon:) ). Or should just hang on and ride as the business is still doing right things and moving in line with its vision?
