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Thursday, September 10, 2009

Stocks To Buy - Hidden Gem - Jagatjit Industries

Here is a hidden gem from famous equity analyst Ashish Chugh. He discussed this recently on a TV channel. Ashish Chugh is known to identify the companies with hidden intrinsic value of the stock and recommends to buy stocks at early stage. The stock recommendations from him could prove multi-bagger stocks in long run.

Jagatjit Industries is a 60 year old liquor company famous for Aristocrat brand Whisky. They also had brands like Maltova, etc. which they sold to SmithKline a couple of years back. This company was dragged in problems between the promoters of the group and a wide order in the month of March by CLB, that problem has not been resolved. CLB ordered the company to buy back the shares of other promoter group and they have already brought back the shares which led to reduction in equity from about Rs 52 to about Rs 44 crore. If you look at the valuations of the company, at the current price the market cap of the company is just about Rs 200 crore, the gross of the company is Rs 540 crore and this being a 60 year old company and the market cap just being 50% of gross, the real value of the assets must be much more.

This company has done sales of about Rs 800 crore in the last year, so even if you compare this company with the drop on the basis of sales and brand equity this looks grossly undervalued compared to the peer group.

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