FINANCE & STOCK ADVICE: My View On KPIT Cummins

About The Company

The company has added 3 new customers during the quarter, taking the total number of customers to 126. It added 106 new employees and this takes the total headcount at the end of Q3 FY09 at 4867.

The stock could see some fancy come back only after the March results. Till then, the stock would remain range bound at around same levels.

About The Results

The company has posted results for the quarter ended 31^st Dec 2008 was not too bad, if one decides to ignore the forex losses it has not provided for. But it is precisely this concern, of burgeoning forex loss which would come at the end of the year which has kept the stock price low.

The company had entered into options contracts to the tune of US$42.60 million for hedging its USD/EUR revenues and was linked to EUR-USD cross rate movement for next four years. The two of aforesaid contracts were knocked out completely and one contract was knocked out partially during the quarter. The MTM valuation of the balance portion of the partially knocked out contract as provided by the bank on 31 Dec 08’ is a loss of Rs.21.29 crore. There is material uncertainty arising from future events mentioned in the option contract and over the period of 3.5 years. The liability under the option contract, that is remaining partially open, is dependent on the Euro / USD exchange rate. The company has significant exports in Euros and is not able to estimate the actual liability on these contracts. Therefore, no provision for the liability and loss on account of option contracts has been made in the books as on end of third quarter.

The company posted a YoY 22% rise in revenue at Rs.184.52 crore. EBITDA was up 21% at Rs.28.67 crore and net profit rose 19% at Rs.16.87 crore. QoQ, the performance was flat, with a 55 fall in topline and thanks to reduction in selling and distribution expenses, it more or less maintained the net profit at the same levels as in Q2FY09.

About the Stock

We need to keep the stock in wait & watch category for better results.

Disclaimer : I do not have any personal holding in this stock.

MULTI BAGGER STOCK GROUP

Some of my group's multi bagger picks during the rally were NMDC , MMTC , STC , Larsen ,Jindal Steel & Power , Unitech , BF Utilities , Jai Corporation , Walchand Nagar Industries, RNRL , Reliance Infra (Reliance Energy) etc.

I had been long associated with a corporate engaged in financial services , where with the assistance of specialized tools along with my special analysis as per some historical accepted theories of stock market like W. D. GANN's Theory , Elliot Wave Theory and others are used with reliable insider information of so called " operators" who play a major role to make a stock ,a Multi Bagger ,I do make my gem picks in this market.

I had been running my group , where the associated people get the reliable and most beneficial to get the unexpected return as seen in the above mentioned tips. Say for example the stock called MMTC had jumped from 2000 level to 56000 per share of historical price where the capital appreciated by 28 times in very short period with 2700% return on capital employed. Likewise in RNRL we started accumulating at RS 25 level from where we saw it moving at 250 level giving 10 times with 900% return.

These sort of return is helpful as ,

1. Handsome gain will make a jack to our capital.

2. Limited stocks trade , as daily trade could be avoided , which is more risky.

3. Long term capital gain , so no tax liability.

4. Whole income in white, which could be further deposited into fixed deposit to get assured monthly income later.

5. Strong income tax file without paying any taxes.

Our role here could be summarized as :

1. Giving tips to all registered member at proper time , when the stock is just about to take off, neither too early not too late.

2. Make sure investor do not gt stuck into it.

3. Recommend to exit when the operator is about to leave it.which is the most important work or else the whole accumulated and deemed profit will be washed away along with part of investment and will remain stuck for long - long period.


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My View On KPIT Cummins