Ponni Sugars (Erode) Ltd - Bargain Purchase?

Market Cap at Rs. 215 Crores
Debt Free & NCAVPS Positive Company

Sugar:
Capacity - Probably the lowest amongst the listed peers at 3500 TCD - Decent Recovery from crushing at about 9.8-10%
MSP fixed by the govt at slightly higher rate as compared to last year - Most likely not have much impact on EPS as compared to last year of Rs. 30/-

Small Ethanol Capacity - in talks with State Govt - for about 45KLPD

Investments:
Holding about 88.4 Lakh shares in Seshasayee Paper Board valued at approximately Rs. 250 Crores
& Also 500,000 Shares of High Energy Batteries - valued at Approximately Rs. 15 Crores

To be considered -

  • Holding company Discount
  • Cyclical Product

Any views - am I missing out an anything?

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