I have copy pasted 2 commentaries on Shree Ganesh Jewellery House IPO from “moneycontrol.com” and the same had appeared in a business channel (owned by the same group) on the same day.
Once you go through the same, you will know how the so called experts are taking gullible investors through a ride by their free advice on television.
This is how it goes.
(The initial public offering (IPO) of Kolkata-based Shree Ganesh Jewellery House, an exporter of handcrafted gold jewellery, has been subscribed 0.88 times so far, as per data available on the NSE website.
The 142,69,831 equity shares issue will close on March 23. The company plans to raise around Rs 371-385.3 crore at a price band of Rs 260-270 a share.
Experts looked bullish on the IPO. Investment Advisor, SP Tulsian as well as Manish Bhatt of Prabhudas Lilladher said the issue looked good and recommended investors to subscribe to the issue.
Tulsian said, "Shree Ganesh is now going in for an expansion of about Rs 330 crore, for setting up new manufacturing facilities, expansion of existing manufacturing facilities and setting up retail outlets. This is largely financed by proposed fresh issue of about Rs 325 crore calculated at the upper price band. As all the expansion are likely to get completed in calendar year 2010, part benefits of this will be reflected in the financials of FY11, in which an EPS of over Rs 45 can be expected. As stated, present cash balance of Rs 625 crore will be able to meet the enhanced working capital requirements."
"A share at 270 is issued at a PE of about 8 times on historic earnings and about 6 times on FY11 earnings. This makes the issue attractive and investment is recommended in the issue at the upper price band," he said.
Bhatt said, "Shree Ganesh Jewellery is into hand made jewellery, has 550 employees on pay roll. It is expected to post turnover of Rs 3100 crore in FY10 and PAT of Rs 175 crore. It is available at 7-8 PE at price band of approximately Rs 260-270. Credit Suisse has 11% stake in company, which will be reduced to 7% in IPO.")
This was published on Friday, March 19, 2010, at 1743 hours in moneycontrol.com under the heading “Shree Ganesh Jewellery IPO opens; should you subscribe?”
The same so called “expert” SP Tulsian comments on the same stock again in the same channel and on the same website April 12, 2010 at 1107 hours.
(Investment Advisor, SP Tulsian is of the view that Shree Ganesh Jewellery can bounce back to Rs 200 in the near term.
Tulsian told CNBC-TV18, "Shree Ganesh Jewellery has been beaten down to what it deserves because if you take a valuation call, I was not expecting this stock to fall below Rs 200. But it has fallen. If you see the response, though we have been comparing this company with Gitanjali Gems etc, but if you see the recently listed which is Thangamayil Jewellery, which his a very small Madurai player, a reasonable player and now they expanding in the Southern region, especially in Tamil Nadu, I don’t think that you have disappointment on that.”
He further added, “One can expect and EPS of close to about Rs 40 going FY11. I have been impressed by their working capital management, they have a cash balance of close to Rs 600 crore, which is used for all their fund-based and non-fund based facilities, because you need a lot of fund based facility also in this trade. Going forward, with a topline of Rs 3,000 crore, I feel this should give a bounce back and move back at least to Rs 200 in the near–term.”)
How the same person can first says “This makes the issue attractive and investment is recommended in the issue at the upper price band.” Here the upper band meant Rs. 270.
The share had a dismal listing and lost around 39% on debut. This is when the same “expert” says “Shree Ganesh Jewellery has been beaten down to what it deserves.”
In 24 days flat (from closing day of the IPO to listing day) this so called expert has done a volte face and anybody who had listened to him in the first place must be licking his/her wounds now.
MORALE OF THE STORY: It is your money which is being invested and it is you who will make the profit or loss. If the people who are coming as “experts” really knew anything about the listing price or future prices, then they would not be coming to the television shows everyday and going through the length and breadth of the country as “experts” in investor camps to earn their bread. They would instead make loads and loads of money from the market itself.
The people who really know the stocks do not come on the TV to give minute by minute commentary and analysis? Even if they did they would have been gentleman enough to accept a wrong recommendation.
The greatest expert on stock market “Benjamin Graham” had years ago told us not to apply in IPOs as they are “it’s probably overpriced.”
Would you still watch or believe in the business channel’s experts. Well, do it at your own risk as it is your own money which will be lost and the “expert” will be paid by the channel for the rubbish they speak and the channel in turn by the advertisers.
Once you go through the same, you will know how the so called experts are taking gullible investors through a ride by their free advice on television.
This is how it goes.
(The initial public offering (IPO) of Kolkata-based Shree Ganesh Jewellery House, an exporter of handcrafted gold jewellery, has been subscribed 0.88 times so far, as per data available on the NSE website.
The 142,69,831 equity shares issue will close on March 23. The company plans to raise around Rs 371-385.3 crore at a price band of Rs 260-270 a share.
Experts looked bullish on the IPO. Investment Advisor, SP Tulsian as well as Manish Bhatt of Prabhudas Lilladher said the issue looked good and recommended investors to subscribe to the issue.
Tulsian said, "Shree Ganesh is now going in for an expansion of about Rs 330 crore, for setting up new manufacturing facilities, expansion of existing manufacturing facilities and setting up retail outlets. This is largely financed by proposed fresh issue of about Rs 325 crore calculated at the upper price band. As all the expansion are likely to get completed in calendar year 2010, part benefits of this will be reflected in the financials of FY11, in which an EPS of over Rs 45 can be expected. As stated, present cash balance of Rs 625 crore will be able to meet the enhanced working capital requirements."
"A share at 270 is issued at a PE of about 8 times on historic earnings and about 6 times on FY11 earnings. This makes the issue attractive and investment is recommended in the issue at the upper price band," he said.
Bhatt said, "Shree Ganesh Jewellery is into hand made jewellery, has 550 employees on pay roll. It is expected to post turnover of Rs 3100 crore in FY10 and PAT of Rs 175 crore. It is available at 7-8 PE at price band of approximately Rs 260-270. Credit Suisse has 11% stake in company, which will be reduced to 7% in IPO.")
This was published on Friday, March 19, 2010, at 1743 hours in moneycontrol.com under the heading “Shree Ganesh Jewellery IPO opens; should you subscribe?”
The same so called “expert” SP Tulsian comments on the same stock again in the same channel and on the same website April 12, 2010 at 1107 hours.
(Investment Advisor, SP Tulsian is of the view that Shree Ganesh Jewellery can bounce back to Rs 200 in the near term.
Tulsian told CNBC-TV18, "Shree Ganesh Jewellery has been beaten down to what it deserves because if you take a valuation call, I was not expecting this stock to fall below Rs 200. But it has fallen. If you see the response, though we have been comparing this company with Gitanjali Gems etc, but if you see the recently listed which is Thangamayil Jewellery, which his a very small Madurai player, a reasonable player and now they expanding in the Southern region, especially in Tamil Nadu, I don’t think that you have disappointment on that.”
He further added, “One can expect and EPS of close to about Rs 40 going FY11. I have been impressed by their working capital management, they have a cash balance of close to Rs 600 crore, which is used for all their fund-based and non-fund based facilities, because you need a lot of fund based facility also in this trade. Going forward, with a topline of Rs 3,000 crore, I feel this should give a bounce back and move back at least to Rs 200 in the near–term.”)
How the same person can first says “This makes the issue attractive and investment is recommended in the issue at the upper price band.” Here the upper band meant Rs. 270.
The share had a dismal listing and lost around 39% on debut. This is when the same “expert” says “Shree Ganesh Jewellery has been beaten down to what it deserves.”
In 24 days flat (from closing day of the IPO to listing day) this so called expert has done a volte face and anybody who had listened to him in the first place must be licking his/her wounds now.
MORALE OF THE STORY: It is your money which is being invested and it is you who will make the profit or loss. If the people who are coming as “experts” really knew anything about the listing price or future prices, then they would not be coming to the television shows everyday and going through the length and breadth of the country as “experts” in investor camps to earn their bread. They would instead make loads and loads of money from the market itself.
The people who really know the stocks do not come on the TV to give minute by minute commentary and analysis? Even if they did they would have been gentleman enough to accept a wrong recommendation.
The greatest expert on stock market “Benjamin Graham” had years ago told us not to apply in IPOs as they are “it’s probably overpriced.”
Would you still watch or believe in the business channel’s experts. Well, do it at your own risk as it is your own money which will be lost and the “expert” will be paid by the channel for the rubbish they speak and the channel in turn by the advertisers.
2 comments:
It is shocking to know how irresponsible media has become today. Integrity seems to be a word from another planet.
It s a pity how degraded they have become.
like the one given here, there r lots of examples where the so calling experts of the business channels hv told different views on the same scripts on the either day. Cartoon Network of Business Channel(cnbc) hv all these cartoon characters giving all nonsense targets.
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