Sunday, September 5, 2010

BPL Ltd...CMP: making a come back...

I read two news at one internet site which says that BPLLtd management wants to turn it around.....
First I am pasting those news so that one can read and understand what they are upto:

1)   BPL's Traditional Biz Rights Lands Up With Start-Up Firm:

Ex-BPL exec Ricky Gosain's Reach Distributors has five-year rights to use the brand in seven categories including CTVs.

BPL Ltd has struck a deal giving the rights to use brand BPL, across seven categories in consumer electrnonics and durables including colour televisions, to Bangalore-based Reach Distributors India Pvt Ltd in return for royalty payment.
The five-year arrangement, running until FY14, is part of BPL's strategy to look beyond its traditional business, and focus its resources on three future markets identified in healthcare, energy and smart homes - a strategy put in place months ago to reinvent itself.
BPL, which once ruled India's fragmented colour television industry with over 25% market share, lost leadership to the rampaging chaebols like LG and Samsung who dominate the market currently.
Interestingly, Reach India's promoter group is headed by Ricky Gosain, who was a senior executive with BPL in the past. Sources directly familiar with the development said, the start-up distribution house would take BPL to the semi-urban and rural markets initially, and would tap the urban centres only after building a critical size.
Reach would be positioning BPL at a price between Videocon and LG, and could target revenue of Rs 200-300 crore by FY14, sources added. It would be sourcing products from vendors both in India as well as China.
BPL Chairman & Managing Director Ajit Nambiar's office sought more time to respond to an email sent on Thursday last week. However, a senior official involved in the royalty deal with Reach confirmed the development.
The share prices of BPL Ltd closed at Rs 35.40 today, down by nearly 1%.
It is not clear who are the other shareholders of Reach India, and if any member of the TPG Nambiar family, which controls BPL, are shareholders in their personal capacity. One source said, Reach was fully funded for the time being, but could explore growth capital fundraising next year.
The development, sources said, stemmed from BPL's decision not to play in the mainstream consumer durables market directly. BPL is in the midst of creating a new brand identity - 'Happier Living Everyday' - in healthcare, energy and smart home sectors. BPL promoters have stayed away from investing behind the consumer electronics business since its equal joint venture with Japan's Sanyo Electric wound up.
In 2006, Sanyo was saved from bankruptcy by Goldman sachs, Daiwa Securities and Sumitomo Mitsui which went on to control 70% stake in the Japanese conglomerate. After protracted discussions, a bigger rival Panasonic decided to acquire Sanyo, a process which was completed in July this year.
Reach would be hoping to leverage on BPL's residual brand equity, especially in the southern markets. BPL was the leading brand in colour television besides having respectable market shares in refrigerator and washing machines through the 90s. However, playing in the cut throat consumer electronics and durables space require strong cash flows and equity backing, especially when placing a bet on the latent equity of a yesteryear brand.
The total size of consumer durables and electronic industry is around Rs 30,000 crore, according to Consumer Electronics and Appliances Manufacturers Association (CEAMA), and the consumer durables market is growing at 30%. More than a majority of the market continues to be dominated by South Korean and Japanese players like LG, Samsung, Sony and Panasonic.
The Indian presence in the market is flagged by Videocon and Onida, which once challenged BPL. Rising income levels, double-income families, increasing consumer awareness and penetration into the rural markets are helping this sector grow.

2)  New Innings: BPL Scripts Comeback With Rs 2050Cr Rev By FY14:
August 30 2010, 16:44:51 IST

Focus on healthcare, energy & smart homes as blockbuster yesteryear brand spins 'Happier Living Everyday' story.
Ajit Nambiar, the scion of BPL Ltd, is re-inventing himself, and the business he inherited. When he helmed BPL, which his father established back in the 60s, the brand was a dominant force in India's consumer electronics industry, especially in colour televisions. Then, the chaebols arrived at his doors. The Korean brands LG and Samsung stormed the market at a time when BPL was caught in a liquidity whirlpool following its ambitious diversification and heavy investments made in manufacturing.
The brand soon disappeared from the metros and the top cities, with its partner Sanyo's travails in Japan adding to the woes. Sanyo shut its Indian operations rather quietly when it was being sold to Panasonic globally, in 2008. BPL and its founding TPG Nambiar family went into business oblivion thereafter.
Last year, in October, Ajit Nambiar shifted BPL's operational headquarters from Dynamic House, located at the heart of Bangalore's business district, to the city's outskirts near Bannarghetta. And he soon unveiled an internal business strategy aimed at overhauling BPL. It has two parts. First, it involved jettisoning any direct revival plans in the mainstream consumer electronics space, and giving up on manufacturing story as the key differentiator (a belief that Nambiars held on tightly for forty long years).
Secondly, he along with a core team of advisors embarked on re-shaping business portfolio searching for potential future markets that can be leveraged on BPL's strengths. They looked hard at businesses and started transitioning. What emerged was a new storyboard, a fresh theme, and a new positioning (in the making) for brand BPL.
Nambiar wrote in an internal dossier earlier this year: "The world has changed beyond recognition from the time BPL came into being four decades ago. We have to therefore change the way we look at the world around us and how we conduct our business in it. The new age Indians have aspirations for a happier, healthier and a more secure life. Our purpose lies in helping people fulfill these simple dreams - Happier Living Everyday. To us happier living means improving the quality of peoples lives through focusing on their health, their comfort, their security and their enjoyment. Our business focus today is on three sectors - healthcare, energy and smart homes."
They are together projected to bring in Rs 2050 crore revenue by FY14. Energy generation and management solutions will bring around Rs 1,465 crore, while healthcare management solutions will show up with Rs 425 crore and smart home solutions will be Rs 60 crore.
The energy business will operate in two domains - power generating assets and energy efficient solutions. BPL Power Projects (AP) Private Ltd is implementing the flagship 600MW project at Ramagundam in Andhra Pradesh. Interestingly, this project has been given a fresh lease of life by the AP State Government and the United Progressive Alliance (UPA) Government at the Centre after the company missed several deadlines to achieve financial closure. Bharat Energy Ventures, another group firm, has signed up MoU with Chhatisgarh State Government for 300MW power project. The revenue from these projects, especially Ramagundam, is expected to start flowing by late FY13 and touch Rs 950 crore by FY14.
Two group companies BPL Telecom Private Ltd and BPL Techno Vision Pvt Ltd will play in energy management solutions for "always-on" energy in the digital information age. The first one will be working with power utilities to reduce transmission and distribution losses, essentially creating a smart grid that is fast healing, more efficient and operates increasingly like today's Internet. BPL Techno Vision will be focused on rechargeable lighting products, solar lanterns, LED lighting systems and studylites. Revenue from the two entities could be crossing Rs 515 crore by FY14 from Rs 147 crore in FY10.
Healthcare Management Solutions under BPL Ltd has evolved from the group's traditional presence in the medical electronics business. With revenue of Rs 108 crore in FY10, it provides innovative products and solutions - like patient monitoring systems, electrocardiographs, defibrillators, foetal monitors and point of care equipment - for early detection of diseases at affordable cost.
Smart Home Solutions, also parked with BPL Ltd, is seen as the more futuristic of all the three businesses. It will tap the emerging opportunity for home energy management systems, home security systems, home network systems and home entertainment systems through a slew of products. BPL has made a beginning here with a portfolio of home security and comfort products that brought in Rs 3 crore in FY10.
Nambiar believes brand BPL can take upon the task of building 'Happier Living Everyday' leveraging on its core strength of applying technology. The task is challenging, as in his own words, the world has changed dramatically from the days when BPL rather optimistically claimed 'Believe In The Best'. Does anyone remember BPL Oye! that brought Amitabh Bachchan to television for the first time in the early 90s?
If four decades of highs and lows in business life has convinced the Nambiar household of anything, it is probably the need to be nimble-footed and agile in thinking. In hindsight, BPL spent some of India's best growth years in rediscovering itself.

My Analysis:

Well, It seems that management wants to bring back the lost glory back.BPL Ltd was a blue chip Co in 90's.
How it went back and become a lagagared is already written in the above article.
But what catches my eyes is , management says that they wants to make it a 2050 cr Co by 2014! That is huge......the Mcap now is 174 cr and if the Co becomes a 2050 cr Co by 2014 then we are going to see BPL Ltd becoming a huge huge multibagger by 2014.
Well, it will all depends on how the things will fall in place and needs to be on constant vigil on BPL Ltd if someone wants to invest BIG in it..because at 174 cr Mcap and becoming a 2050 cr Co , means,it can be atleast a ten bagger from here on.........
Well, I feel that one can take a small exposer in  BPL Ltd now and keep on adding as news unfolds....that should be the strategy...but one should follow what is good for them....
Well, as I use to write many times....I do not know anything about statistics( Cash flow/RONW , Debt ratio, etc etc) but I am good at analysing things correctly and quickly....and I read a lot and pick the finer prints written quickly...I am able to read between the lines...I may prove wrong and I may prove right ........but untill one do not come on any conclusion , one never knows whether you were right or wrong.....and stock market is taking decision.....picking stocks at very early stage...that is very important in stock market and that is what I am doing here.Bringing undiscovered stocks to small investor and that too cheap.....picking them up before someone pick it up or identify it ,we become first to take a stake........
What I want to suggest is, become sharp.Become vigil.No news on stock needs to go unnoticed.One need to have passion in what you are doing.When one is investing your hard earned money in stocks then one need to search everything on where you have invested and needs to be updated on it .......


  1. Hi Rajeev,
    Are Navin Fluorine and PSL still on your multi-baggers list?(i know the fundamental have not changed, but wanted to be assured)
    And if you do follow Medi-Caps, your views on it?
    Thanks in advance,
    With Regards,

  2. vikas,
    Navin and PSL looks good to me still.....Medicaps I do not track...

  3. Hi can u put some light on polyplex , jindal poly and uflex can we buythem and and if yes then at what price, regards

  4. As with BPL ,something similar is the position is with Onida brand too.They have lost their glory because of families issues .I can see Onida also trying to get back on track but nothing is working great for them.I don't have any numbers for them but i am keeping an eagle on MIRC electronics ( Onida ).

    Amit Luthra

  5. Hi Amit,
    The diff between Onida and BPL is ONIDA is already a 1500 cr Co.What needs the family to do is bury the hatchet and restructure the debts.They have got wonderful poducts.
    While BPL sales is just below 100 cr and hence has more probability to give more returns.
    Moreeover, Onida is 1 paidup , means it is already Rs 259.00 as 10 paidup while BPL is still 10 paidup and is the 38...yesterday people bought it , maybe after reading my blog...LOL.....
    That is why I like BPL more then Onida....
    So the bottomline here is, if Onida debts is restructured it will out perform, but just imagine, if we see BPL sales at Rs 2050 cr, and the present Mcap is 176, what can be the return...means with 85cr sales, if it goes to 2050 cr ,BPLhas more chances to give multiple return then Onida....
    That is my view and I may prove wrong....

  6. namit,
    Polyplex has already runup but still looks good.Jindal Poly is now out of reach.Makes no sense buying Jindal poly @900...
    Uniflex looks excellent at this price.I like this stock very much.....

  7. Dear Rajeev,

    Your call on gmr ferrous reached at 80 level is the stock is still good. I hold jindal poly for two year but it never shows value , when i quit in loss , it makes new high and that is huge.Also look at Venkys it also making new highs.

  8. TT, That is the lesson to learn.Hold stock which have great management and great fundamentals......No onw knows when it is going to soon as people will gte tired of PSL Ltd, it will start making new highs....

  9. Hi Rajeev,
    Can demat account be shared between two peoples? If yes then if one member is senior citizen and another is non-senior citizen, then how tax is applied?


  11. Rajiv bhai
    i like bpl for long term .in harshad mehta time i sold bpl@650 per share
    one more scrip Raju bhai i want your sujjeson
    Ruchiinfra FV 1 cmp 36 today we see good volume
    Ruchi Infra :- view by Economist

    Ruchi Infra has bought back millions of GDRs in the past, suggesting solid financial resources. It is backed by solid Ruchi Soya group who has turnover of over $2 Billions.

    Stay with it. The smart marketmakers depress the good quality stocks with a view to accumulating it. The company is in core infrastructure business near port area where the investment is proposed to be expanded by 300%. I would keep this stock on 5 years hold basis

    please share your view

  12. Rajubhai
    very soon trading in stock market via mobil phone start
    which software company benifited
    tanla solution also make software for mobile banking but i dont know which one benifited
    please share your view

  13. Wow! SNL hits the century...thanks Rajeev!


  14. Rajeev Sir,

    Super Spinning has come out stupendous results.
    Your views on the upcoming quarter and from thereon....

    Your textile recommendations are doing great. All 5 appreciated approx 70-90% (except loyal which is around 45%)

    Super Spinning
    Super Sales
    Suryalata Spinning
    Suryavanshi Spinning
    Suryajyoti Spinning..
    Loyal Textile

    I have taken exposure in two.
    SNL has touched 101. I entered the counter at 19 and have booked profit today sir. But still kept few quantity with me. :)


  15. rathi steel
    might go wrong with the timing but some more food for thought

    Mining Plan (March 2010) for Kesla North Coal Block, Korba Coalfield
    in Korba District, Chhatisgarh, of Rathi Udyog Ltd.:

    This Block located in Korba District, Chhatisgarh was allotted to
    Rathi Udyog Ltd. (now Rathi Steel & Power Ltd.) on 05.08.2008 for
    meeting the coal requirement of their 0.75 mtpa sponge iron plant in
    Orissa. Total geological reserves of the block are estimated to be
    36.148 Mt spread over the block area of 750 HA.

    Five coal seams viz. R-IV, R-III, R-II, R-I & R-IA occur in the block
    in descending order, in addition to two local seams. The grade of coal
    varies from A to G but bulk (80%) of it is in superior grade i.e. A,B
    & G. Coal seams exhibit north-easterly dip over vast area. Number of
    borehole drilled are 64 in 750 HA. Both opencast mining (extractable
    reserves- 1.994 Mt in seams R-II & R-IA at overall stripping ratio of
    18.27 m3/te upto a depth of 50 in with Shovel/Dumper combination in 3
    pits) & underground mining (extractable reserves- 12.27 Mt in seams R-
    IV, R-III, R-II & R-IA with continuous miner) have been proposed. Seam
    R-I is not workable due to low thickness. Combined (O/C + U/G) target
    capacity of 0.30 Mty is proposed to be achieved in 2nd year of
    operation. Opencast mine wall last upto 11th year of operation &
    underground mining will start from 4th year of operation. Total life
    of the project is 51 years.

    After due deliberation, the Standing Committee approved the Mining
    Plan (March 2010) for Kesla North Coal Block with the following


    The mining company shall take all necessary precautions
    regarding safety of mine workings and persons deployed therein.

    Mining lease to be acquired shall not encroach into any other
    coal block.

    The approval of the mining plan is without prejudice to the
    requirement of approvals from competent/prescribed authority under the
    relevant rules/regulations, etc.

  16. Dear Rajeev,

    Came across a very good article from Adrian Mowat, MD, JP Morgan on "Indian markets offering high growth". Must read for all...

  17. Rajeevji

    I agree with your views on BPL and I see future prospects in the stock to become a multibagger in case the Nambiars set their house right. Similar was the case of IFB Industries, if one may recall. The downside from the CMP can be a max of about 20% and hence worth taking the risk of pftaking the position. Therefore, I have made a beginning by adding a small quantity yesterday. Thanks for throwing light on this possible dark horse.

  18. Rathi Steel seems to be the on the verge of a major breakout today with high volumes and price rise . Looks to be a good bet even at current price. Holding this scrip in large chunks for time frame of atleast 3-5 years. Would like comments from various bloggers as when any news arrives on this scrip.

    A major equity research company has come out with a buy now on SNL @ 100 with a price tgt. of 150/175.Whereas Rajeevbhai gave a call on this scrip around levels of 20-25 .

    Hats off to this blog.

  19. Rajeev
    Parekh Aluminex is firing all cylidner. It reached 500 Rs today. Bought60 shares @ 107 Rs. Wish I had bought more ! Hats off to you Sir. Internse Technology and Cat Vision have not moved for a long time.

  20. mech,
    I gave the call for SNL bearing at Rs 11 and not around 20-25....that is again double from my 1st call......
    SNL is my first 10 bagger for my readers at this blog....

  21. Mukund,
    U bot Parekh Alu@107, 60 shares , means you invested Rs.6500 for that much of shares.
    At the price of Rs 500 now, you are getting clean profit of Rs.23500....and I think that is within a can anyone show me which bank or business will give profit of 23500 on 6500 invested? a YEAR!

  22. Well picked Rajeev.... I was just a little late in seeing the post on SNL Bearings so I could only get in at Rs 25 levels, its still good profit.

  23. Rajeevji, I too would like to congratulate you for Parekh aluminex. I have very small qty of 75. I am planning to sell 25 and make the rest free holding. Let me know your views. - Sanjay

  24. JC,
    It is not good profit.It is excellent profit.400% return in a year is excellent by any standard.....

  25. Sanjay,
    Now how much u wants to sell and how u wants to keep is in ur hand.I can't advice on that but happy to see readers making money on my I have written many times, making money in stock market is not easy.One mistake and all ur profits are gone in a single stock....

  26. C C Roy,
    I have been recomending IFB Ind since Rs 65 and kept on recomending till 95......I gave all the reasons why I like it....
    BPL Ltd has growth in it as the Mcap is 176 cr and sales is 85 cr.Means if the sales touches 2050 cr then the Mcap will automatically go up.It may happen that it do not go immidiately but as soon as the market will realise the potential , BPL will go up....

  27. Rajeev,
    I can name another pick Supreme Petrochem which you recomanded around Rs.28 which is now more than double trading at Rs. 64 and I am fortunate to had this at that level around Rs. 30 and sold 50% at Rs 60 as per your methodology to have rest as free.

    I admit you have an god gifted ability to see the things way ahead and thanks for guiding us all.

  28. Partha,
    Yeah, I am seeing that too.It is 64 and it is more the doubled from my call and still long way to go.
    I have been writing about it time and again but no one gets convinced and they miss it and then they curse about it.....
    Supreme Petro is still a buy....according to me...but what u have done is excellent...selling 50% at double and holding rest let it go whereever it wants to...

  29. Percentage is excellent rajeev but I could only pick up a small amount... you know human nature Rajeev, if we lose we say "I shoudnt have bought" and if we gain we say "I should have bought as much as I could!"

  30. Rajeev,
    When I am following you I have the full trust on your ideas and ability, So I try to follow all your saying.
    Like I try to catch all your said picks whatever small amount I can have as per my capability.

    after your recomandation
    can i ask you some very personal question
    do u have any link with MAA SARSWATI ?????
    because your call is rocking in 19k sensex also