Buy KELTECH Energies (BSE: 506528) at 212 for a medium term 6 month target of 260 (+22%). Very high EPS of over Rs 50 per share and high book value of 182. At 212, the company, which regularly earns profits is quite under-valued. Going by valuation, it should be really quoting somewhere near 280-290. The only problem is low liquidity and volume, which poses a certain amount of risk and also difficulty to get hold of shares.
Keltech Energies Ltd, (KEL) was set up in 1977 and is part of the Chowgule Group of Companies, Goa. The company is headquartered in Bangalore, Karnataka while its manufacturing unit is located in Vishwasnagar, Near Udupi, also in Karnataka. The company sources perlite from various countries like Turkey, USA, New Zealand, and Greece. The group is in the fields of mining, shipping, shipbuilding, chemicals, explosives, expanded perlite, breweries and many other industries. Keltech Energies Ltd. makes Watergel cartridge explosives, Bulk emulsion explosives, Mono Methyl Amine Nitrate (MMAN) solution and a variety of expanded perlite Products. Apart from the domestic market, KEL's Watergel explosives, MMAN and perlite products are also being exported to other nations.
KEL is a member of the Perlite Institute Inc. USA In 2000, KEL became an ISO 9002 certified Company for manufacturing expanded perlite and it has the proficiency to conduct thermal insulation work of cryogenic tanks.
KEL also carries out turnkey installation of in-situ light weight perlite-concrete blocks for base insulation of cryogenic tanks and annular insulation filling of double wall LNG tanks. KEC has the expertise to undertake turnkey thermal insulation jobs for Cryogenic storage tanks. KEC's products are used in various industries like the CONSTRUCTION AND INSULATION, HORTICULTURE, POULTRY, ABRASIVES, OIL WELLS etc. The company sources perlite from various countries like Turkey, USA, New Zealand, and Greece.has Perlite Expansion Plants in south and central India to manufacture a range of perlite products suitable for use in Cryogenic insulation, Construction, Refractory, Explosives, Fillers, Foundry, Thermoplastics and Horticulture.
with an equity base of only Re 1 Crore, out of which the promoters have a stake of 50%, leaving only 50 Lakhs/10= 5,00,000 shares with public, it is not worth it.
ReplyDeleteThe EPS is high simply becos of low equity.
Otherwise, on a sale of Rs. 111 crores, it has a net profit of only Re 1 cr for the quarter and 5.9 crores for the TTM, thereby giving an eps of 50. The quarter sales as well as the profits hv gone down
Such companies can go down from an eps of 50 to loss in no time.