promoter is buying almost everyday
seems some sort of a ploy to me at any rate this is one of those companies you stay away from even if you are getting the shares for free.
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good question, understanding management can be tricky, but you need to look for obvious reasons and make up your mind by observing their actions periodically. In case of SOM, i came across multiple discrepancies and here are a few:
- The CMD is likely giving paid interviews which are one sided and hardly any tough questions are asked during interviews.
- Despite producing excellent results, people lack trust/confidence in their corporate governance practices. They recently devalued investors stake in their subsidy without the investors consent.
- They may or may not be on the good books of the state govts they work with. highly unpredictable business. Possibility of huge bribe involved to run their day to day operations. There have been multiple raids at their complexes.
- Things like child labor, even happening at their associate company, shows the attitude of the management and the malpractices they are open to. There might be 10 other hidden malpractices going on which haven’t surfaced yet.
Beware of such management, don’t invest your money into any company where you see even 1 red flag with the management. Here i see multiple red flags over a period of 2 years of keen observation.
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actually i was following the company and seeing results but through the valuepickr i noticed that on concall the promoters are not giving any clarify on tax rate of the company and they are just passing the questions from audience lukkily not invested and this child labour issue came up how simply they are giving clarrify on issue saying that ita there associated company never invest such companies
what do you guys think about SDBL now? According to me reasonable valuations and good earnings visibility ahead. Also the EBITDA margins will increase the bottom line.
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Corporate Management issues. Better to look for a next good opportunity.
Don’t really understand! Why will the promoters keep buying then? Shouldn’t they actually do the opposite of this, if at all?
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heard concall fo SBDL for Q1. Company is doing well but management is not forthcoming with clear numbers - lots of confusion on call.
why was split done in such an odd ratio - quite unusual way to do it…
No idea, I took a complete exit long back. Lost whatever little faith I had in the management.
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What is the reason for lack of faith in management… corp governance issues? company is doing well financially.
Despite doing good financially it’s not getting the value.
I think street doesn’t have much faith in the management or street expects growth to be unsustainable or both.
Read through the thread. Promoter’s record on treating minority shareholders is dubious
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Financially i dont think there is any problem… cash flows from operations are high, borrowing coming down inspite of capex.
I have another theory but not sure if true… Promoters have been buying from mkt and could want to increase it further and hence keeping the price down… Surely not good corporate governance…
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I think it is not possible since the promoters are not majority shareholder of the company in the first place. It is 35% something so I don’t think this is true. Moreover the volumes have dried up big time but on positive note the delivery percentage has increased significantly from the monthly and weekly average. So lets hope for the best…
While all this chatter going around som, dolly khanna increased the stake in the company…how do wo interpret this…?
Their beer brand seems to be doing very well in delhi and bangalore…got approval to enter telangana as well…
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Price is remaining subdued on account of institutional investors keeping away due to some news flow…some names like aditya birla money are still there with foot in the door strategy… however i think as the peformance of som grows stronger, fresh institutional and retail flows will start coming in as most of the other liquor industry stock are trading at very high valuation while som is deeply undevalued… like i mentioned dolly khanna has increased the stake in last quarter amid the child labour news flow…so once things cool off around news flow, valuation will eventually catch if company continues to deliver strong results…
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While HNI investors like Dolly Khanna have made good investments, they are very quick to get out also if they think it is wrong decision and retail investors following them get stuck !!
I agree that valuation is low and will eventually catch up to peers.
The cause of the negative news will eventually be corrected by the company given that financial performance is very good. also with size increasing companies usually adopt good practices.
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as expected SDBL is very volatile… Q2 numbers will be a good indicator of performance on this stock. and will determine long term trend… assuming there is no negative news.
This company has a very chequered history when it comes to its corporate governance. They repeatedly get involved in some kind of dodgy activity or the other and hence the valuation.
Disc: Used to be invested. made complete exit
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Please stay away from companies with bad management, who is actually capable of not only posting dubious numbers but cut out minority shareholders at any point. This company has a very suspicious history.
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