maverick
28-11-2007, 06:26 PM
Suashish Diamonds-The King Of Bling
BSE 526733; CMP Rs 226
The Rs 1000 crore Goenka's owned Suashish Diamonds is set to get re-rated, as its efforts to diversify into made-up Gold-Diamond studded jewellery pays off. The corporate started its "Ishi" line of Diamond jewellery in the year 2002, and five years later the reach of Retail jewellery has been extended to 25 cities and 100 outlets, which are contributing close to 15 per cent of its Revenues.
At a market capitalistion of Rs 483 crore, the Suashish Diamonds stock does not reflect the value or the potential of running a profitable Retail operation in the Jewellery trade where though not directly comparable businesses like Titan and Rajesh Exports carry fancy valuations based on FY09 earnings.
Another indicator of under-valuation is the fact that the Suashish Diamonds stock carries a market price that equals its Book Value of Rs 230 to Rs 240 per share.
Third, the bottomline inspite of currency changes and large quantum of Exporting cut and polished diamonds is increasing. For the nine months to September 2007, Suashish reported Revenues of Rs 626 crore, with after tax profits of Rs 47 crore or a non-annualised EPS of Rs 22. This compares favourably with the CY 2006 Revenues of Rs 933 crore and after tax profits of Rs 43 crore and an EPS of Rs 21.
The current financial ending has been extended to March 2008, and accordingly results this time around will be for 15 months. Still it is highly probable that the CY 2006 figures will be moderately exceeded in the comparable 12 months of CY 2007.
The Stock has a concenterated ownership, with the promoters holding 89.4 per cent of the Equity and Rhodes Diversified another 5 per cent, followed by 2.1 per cent held by Mega Resources and 1.6 per cent Anil Poddar. The Public holding is a mere 4 per cent in the company.
Suashish thus remains a prime candidate for de-listing and recent de-listing offers through reverse book building have suited the small investor.
Suashish, Now in Botswana
After decades of being a DTC sightholder and a stakeholder in the Argyle mines of Australia, Suashish has become the first Indian company to become a DTC sightholder in Botswana. A wholly owned subsidiary has been set up with a equity-debt funding of $ 6 mn by Suashish.
Suashish Diamonds (Botswana) (Pty) Ltd., their wholly owned subsidiary in Botswana, was listed as a DTC Botswana Sightholder earlier in November 2007.
This WOS becomes India's first and only Company to receive Sightholder status in Botswana. The sightholder contract extends for a three-year period, from 2008-2011. The Company has already invested close to US$ 2 million to set-up a 10,000 sq.ft. state-of-the- art diamond cutting and polishing facility in Botswana which started production last month.
Ashish Goenka, Managing Director, of the Company said, "We, at Suashish Diamonds, are proud to be the first and only Indian Company to be a DTC Botswana sightholder. Suashish Diamonds has embarked on an aggressive expansion plan and our Botswana cutting and polishing facility, has become operational in October this year. Becoming a DTC Botswana sightholder will also ensure that we get regular / assured supply of rough diamonds at competitive rates."
Mr. Goenka further added, "Starting a factory in Botswana is a forward looking step as Botswana is the world's leading diamond producer by value alone and aligns with the desire of the government of Botswana for greater local beneficiation from the diamond
industry."
34.3 mn carats out of the 51 mn carats of rough diamonds mined by the De Beers Group in 2006 were mined in Botswana. DTC Botswana, a fifty-fifty joint venture between Botswana and the De Beers Group, was created in May 2006 in an effort to diversify the country's economy
BSE 526733; CMP Rs 226
The Rs 1000 crore Goenka's owned Suashish Diamonds is set to get re-rated, as its efforts to diversify into made-up Gold-Diamond studded jewellery pays off. The corporate started its "Ishi" line of Diamond jewellery in the year 2002, and five years later the reach of Retail jewellery has been extended to 25 cities and 100 outlets, which are contributing close to 15 per cent of its Revenues.
At a market capitalistion of Rs 483 crore, the Suashish Diamonds stock does not reflect the value or the potential of running a profitable Retail operation in the Jewellery trade where though not directly comparable businesses like Titan and Rajesh Exports carry fancy valuations based on FY09 earnings.
Another indicator of under-valuation is the fact that the Suashish Diamonds stock carries a market price that equals its Book Value of Rs 230 to Rs 240 per share.
Third, the bottomline inspite of currency changes and large quantum of Exporting cut and polished diamonds is increasing. For the nine months to September 2007, Suashish reported Revenues of Rs 626 crore, with after tax profits of Rs 47 crore or a non-annualised EPS of Rs 22. This compares favourably with the CY 2006 Revenues of Rs 933 crore and after tax profits of Rs 43 crore and an EPS of Rs 21.
The current financial ending has been extended to March 2008, and accordingly results this time around will be for 15 months. Still it is highly probable that the CY 2006 figures will be moderately exceeded in the comparable 12 months of CY 2007.
The Stock has a concenterated ownership, with the promoters holding 89.4 per cent of the Equity and Rhodes Diversified another 5 per cent, followed by 2.1 per cent held by Mega Resources and 1.6 per cent Anil Poddar. The Public holding is a mere 4 per cent in the company.
Suashish thus remains a prime candidate for de-listing and recent de-listing offers through reverse book building have suited the small investor.
Suashish, Now in Botswana
After decades of being a DTC sightholder and a stakeholder in the Argyle mines of Australia, Suashish has become the first Indian company to become a DTC sightholder in Botswana. A wholly owned subsidiary has been set up with a equity-debt funding of $ 6 mn by Suashish.
Suashish Diamonds (Botswana) (Pty) Ltd., their wholly owned subsidiary in Botswana, was listed as a DTC Botswana Sightholder earlier in November 2007.
This WOS becomes India's first and only Company to receive Sightholder status in Botswana. The sightholder contract extends for a three-year period, from 2008-2011. The Company has already invested close to US$ 2 million to set-up a 10,000 sq.ft. state-of-the- art diamond cutting and polishing facility in Botswana which started production last month.
Ashish Goenka, Managing Director, of the Company said, "We, at Suashish Diamonds, are proud to be the first and only Indian Company to be a DTC Botswana sightholder. Suashish Diamonds has embarked on an aggressive expansion plan and our Botswana cutting and polishing facility, has become operational in October this year. Becoming a DTC Botswana sightholder will also ensure that we get regular / assured supply of rough diamonds at competitive rates."
Mr. Goenka further added, "Starting a factory in Botswana is a forward looking step as Botswana is the world's leading diamond producer by value alone and aligns with the desire of the government of Botswana for greater local beneficiation from the diamond
industry."
34.3 mn carats out of the 51 mn carats of rough diamonds mined by the De Beers Group in 2006 were mined in Botswana. DTC Botswana, a fifty-fifty joint venture between Botswana and the De Beers Group, was created in May 2006 in an effort to diversify the country's economy