November 16, 2010

Manganese Ore India Review,Valuation and Analysis – Government Owned High Quality Mining Stock a Must Buy IPO

Valuation MOIL has a Net Worth of Rs 1860 crores and a NAV of around Rs 110/share.The Company will probably earn around Rs 700 crore this fiscal year after doing Rs 465 crores last year (which was a bad year for the industry).Operating Cash Flow has been generally higher than the Net Profit leading to improved cash position over the last 4 years.The Capital Requirements of the Business is quite low leading to high Return Metrics.If the Government sells the 20% stake at Rs 1500 crore that would give the company a market cap of Rs 7500 crore.Taking out the Rs 1700 crore in cash would make the company be valued at 3.2x BV and 8-9x P/E.This is a substantial discount to Global Mining Companies. Summary Like Coal India Limited,MOIL looks like a very safe commodity investment at a cheap valuation.With growing Indian Demand,MOIL can hardly miss continuing on a steady 10-15% earnings growth over the next 4-5 years.If the commodity prices flare up again like 2008 due to QE2,then MOIL provides a big upside as well.Its a good investment for investors looking to invest in safe mining plays.With government ownership,the typical Indian management risk is also greatly mitigated.
September 9, 2010

India to Divest another State Owned Commodity Company Manganese Ore (MOIL) through an IPO

India has divested small equity stakes in a number of state owned Commodity Companies this year and the trend is expected to continue in the future […]
May 26, 2010

Indian Government prepares $8.5 Billion Divestment even as Investors face losses from past Offerings

The Indian government is fast tracking the process of choosing Investment Bankers for its proposed Rs 40,000 crore($8.5 Billion) divestment of state owned companies in the […]