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October 6, 2014

Patels Airtemp (India) – Multibagger Analysis

by Futurecaps Advisor

Patels Airtemp was incorporated in 1973. It fused technical expertise with innovative to achieve a remarkable growth and an efficacious nationwide presence. The growth saga was further strengthened in 1993, when it became a Limited entity and thus was born, Patels Airtemp (India) Limited.

PAT was the result of the conscious and dedicated efforts of a team of committed Engineers and Promoter – Directors. As experienced of over three decades in the field of design and manufacturing was instrumental in its upbringing. Today, PAT stands proudly as one of the leading manufacturers of high quality engineering products.

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Company URL: http://www.patelairtemp.com/

Screener URL: http://www.screener.in/company/?q=517417

CMP: 123.00

Warren Buffett Checklist

History of Consistently Increasing Sales, Earnings & Cash Flow

Not.  The Sales are flat. image

Durable Competitive Advantage

Not impressive. image

Future Growth Drivers

Moderate. image

Conservative Debt (long term debt < 3 Net Profit)

Not. image

Debt Equity Ratio, Current Ratio

0.3 (Moderate) image

Return on Equity must be Above Average

10% (Bad) image

Low CAPEX required to maintain current operations

Moderate. image

Management is holding / buying the stock

Holding 45%. But increased in past year. image

Price is Under Valued (< intrinsic value)

Not. image

Stock Price is consolidating (now)

Average. image

Stock Price is growing in past years along with EPS growth

Yes. image

Additional Futurecaps Checklist

Consolidated PE, PB Ratio

PE 14 (High for a small cap) image

Cash Flow Positive, Net Profit % greater than 8%

Yes.  Not. image

Paying Dividends, Tax

Yes. Yes. image

EPS Growth Rate

–10%, –5%, –40% image

Jump in Trailing Result EPS

Not. image

Jump in Quarterly Result EPS

Not but decline. image

Expected Gain in 5 Years

1-2X for the max. image

Price Movement Graph, 52 Week High & Low

143/39 (already peaked for the year)  image

Volume Analysis

Good. image

Power of Brand

Moderate. image

Corporate Governance, Reputation of Leaders

Okay. image

Fraud reported

Not. image

Declaration

Under the value & growth grounds of past, we cannot call it as a Multibagger.

image 

Allocation

0%

Disclaimer

Futurecaps recommends 20 to 25 multibaggers per year, we recommend a 25% to 50% allocation of your savings in equity.  The stocks recommended here are gone through Analysts of several years experience in stock market.  Although they were successful in predicting future multibaggers, the overall stock market is a risky game.  So we recommend the reader to put his/her own thoughts & invest wisely.

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