Reviews

MAHINDRA CIE AUTOMOTIVE 

Ticker : 532756
FV:Rs10
52-Week H/L: Rs301.80/204 

We had recommended Mahindra Automotive in Volume No 34, Issue No 47 (dated Sept 10, 2018), when the scrip was trading at Rs 289. Our recommendation was backed by factors like strong growth delivered by the company in both domestic and international business. In Q4CY18, the company’s standalone revenue was up 9.5 per cent YoY to Rs 615 crore. EBITDA grew by 16.9 per cent YoY to Rs 69 crore. EBITDA margin stood at 11%. During the quarter, it incurred loss of Rs 89.5 crore as against net profit of Rs 14.6 crore in Q4CY17. The loss was on account of recognition of full impair- ment loss on the investment made in company’s subsidiary. We see a limited upside in the stock price and as our target date has been reached, we recommend investors to EXIT the scrip. 

SELAN EXPLORATION TECHNOLOGY 

Ticker: 530075
FV:Rs10
52-Week H/L: Rs277.50/158.80 

We had recommended Selan Exploration in Volume No 34, Issue No 49, (dated September 24, 2018), when the scrip was trading at Rs 250. Our recommendation was backed by factors like robust growth in profitability. In Q3FY19, the company’s revenue decreased by 4.7 per cent YoY to Rs 21.1 crore. However, EBITDA was down by 1.5 per cent and EBITDA margin for the quarter stood at 45.9 per cent, with a corresponding margin expansion of 152 bps. PAT jumped by 80.4 per cent YoY to Rs 11.89 crore. Current oil production run rate is much lower than expectation, as the company has struggled to increase production on account of ramp-up challenges in its major oil fields. Subdued production, range-bound oil prices and appreciation of Indian rupee would continue to act as an overhang on the stock. Hence we urge investors to REDUCE EXPOSURE to the stock.