Mirza International – Multibagger Analysis

Update: This stock really is Not a Multibagger up to date.  Since the Valuation change it is No Longer a Multibagger in our view.  You can check other stocks from our latest Multibaggers pack.

https://futurecaps.com/tag/multibagger/

Futurecaps is a SEBI Registered Research Analyst providing Multibagger service to Indian Stock Market.

In this post we can analyze the possibility of Mirza International  as a potential multibagger.

We are holding a research on this as sources say Top Investor Rakesh Jhunjhunwala is increasing holding in the company.

The Company

Mirza International Limited is a frontrunner in the manufacturing and marketing of leather and leather footwear.  The company exports its products globally & holds reputed brands like Red Tape.

Website: http://www.mirza.co.in/

Analysis Link: http://www.screener.in/company/526642

Warren Buffett Checklist

History of Consistently Increasing Sales, Earnings & Cash Flow	Please refer analysis link.
Durable Competitive Advantage	Yes. Through power of brands, owning manufacturing, designing facilities & cost-optimizations.
Future Growth Drivers	Current growth in Indian retail market & Promotion of export market policies should help the company well.
Conservative Debt (long term debt < 3 Net Profit)	Current Liabilities is around 100 crore & Latest net profit is around 44 crores. So pass.
Return on Equity must be Above Average	ROE is 18+ and above the required 15.
Low CAPEX required to maintain current operations	Not.
Promoter Holding %, Management is holding / buying the stock	Promoter Holding 66%, Promoters is buying back more shares.
Price is Under Valued (< intrinsic value)	Almost on the same bar.
Stock Price is consolidating (now)	Yes.
Stock Price is growing in past years along with EPS growth	Yes, but slow

Additional Futurecaps Checklist

PE, PB Ratio	PE is around 7 and PB is around 1 which are good ratios in current market boom scenario.
Cash Flow Positive, Net Profit % greater than 8%	Cash Flow from operating activity is positive.  Net Profit is less than 8% as this sector requires high amount of ads & operating expenses.
Paying Dividends, Tax	Yes.
EPS Growth Rate	10-20% for the past 3 years, thought the latest year shows flat.
Expected Gain in 10 Years	2X-5X in 5 years; The EPS growth is slow – so do not expect high gains.
Power of Brand	Branding attracts more sales, more profit margins!
Corporate Governance, Reputation of Leaders	Good governance history.
Fraud reported	No fraud reported.

Declaration

Here by we declare that Mirza International is a multibagger with possible 2X-5X gain in next 5 years; watch quarterly results carefully for hold/sell decisions.

It is a potential multibagger like Page Industries with good brands under hold, but watch the quarterly results carefully.

Allocation

1-2% of your portfolio.

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.