Wanbury Ltd. – A Turnaround Specialist Turning Itself Around

The company I am going to discuss today has contingent liabilities close to its last FY’s revenues, has been making losses for last so many years, did an international acquisition that went horribly wrong, so this is a company only for very high risk takers and therefore…. others should come back to this blog some other day🙂   .

If you are still reading this blog post, you are most likely having a very high risk appetite and this is a pre-requisite for a stock like this. As growing up I realized that even garbage has value and this stock is way better than garbage, and we could be catching the company- ripe for a blowout, right at its bottom.

Wanbury Ltd. (http://www.wanbury.com/index.html) came into existence with the merger of two diverse companies, Wander and Pearl Organics. It was one of the country’s fastest growing pharmaceutical companies, and has a strong presence in domestic formulations, API, CRAMS and overseas generics. It is the largest manufacturer of Metformin (around 30% of world production is manufactured by wanbury), Tramadol and Salsalate for the US markets. Wanbury has manufacturing plants at Patalganga, Turbhe, Tarapur and Mazgaon in Maharashtra and at Tanaku in Andhra Pradesh. It has two US FDA‐approved multi‐product API facilities and other plants under operation for five semi‐regulated markets. Its customer base includes Cipla, Ranbaxy and Sun Pharma among domestic companies and Teva, Mylan, etc, among foreign companies.

Background: The Company was doing very well and was creating value by taking over stressed assets and turning them around, until it made a catastrophe mistake of buying a Spanish company Cantabria, which proved a very costly asset bought at a very wrong time. The asset was bought completely in 2007, just before the 2008 crisis and unfortunately, what was expected to be the most prized asset, turned out to be its near-death warrant. Wanbury’s timing went horribly wrong, as after 2008 crisis the Spanish economy could never recover and went into deep financial crisis and depression and on a horribly wrong trajectory of unemployment graph (currently around 27% if I am not wrong). In April 2007, the company had issued FCCB aggregating Euro 15 million in order to fund the Cantabaria acquisition, organic expansion, related diversifications and new R&D activities (800 Nos. 1% Unsecured Foreign Currency Convertible A Bonds (“A Bonds”) and 700 Nos. 1% Unsecured Foreign Currency Convertible B Bonds (“B Bonds”) of face value of 10,000 each maturing on 23 April 2012 and 17 December 2012 respectively). Till cantabaria acquisition Wanbuy was a known turnaround and integration specialist (with their successful turnaround and integration of DOCL and wander). The cantabaria entity cost wanbury really bad. With Spanish economy and business going down day by day, eventually after years of struggle, wanbury finally decided to wind down Cantabria last year. The effect of this acquisition and bad economy even forced Wanbuy into CDR a few years back. By the way most of the contingent liabilities arose as a consequence of Cantabaria and its acquisition, most of which is now taken care of.

Past Horrible, Future very exiting: The last couple of years have been really eventful: with new operations management coming in place and on back of CDR package getting approved, the turnaround specialist started turning around itself. Since the new presidents (API and Formulations) took over, the company has remarkably started resurrecting itself. The loses started shrinking and slowly it became EBITA positive and now positive even at the Net level. The products of the company were never a problem and the company’s product brands are well known. The Company continues to focus on Orthopedics, Gastrointestinal, Gynecology and Surgery therapeutic segments. Its brands like Cpink, Adtrol Plus, Rabiplus, Folinine are among Top 10 brands (some even in top 5) in their respective segments. Another product Myotol-f has been rated as the best brand launch of the year and is ranked as No. 1 in its segment by per ORG-IMS. One of the reasons of this turnaround was also price increases of its various brands last year (without affecting the sales), so the company has pricing power too. The company has two US FDA approved plants and other plants for unregulated markets. The company’s formulations and API business both are looking up and showing good growth in last couple of years. As far as FCCB’s are concerned, Most of them are converted to term loans, 128 “A” bonds were converted to 5,29,085 fully paid equity shares at a conversion price of rs 138. Balance of 48 A bonds are pending negotiation. The company is expected to be net positive this year (FY ending Mar 15- internally company still prefers to track Mar ending FYs rather than Sep ending FY which it is forced to follow this year.) and from next year it should start churning good amount of profits. Company is already generating positive cash flow. Company has shown net profits, inspite of servicing their entire debt’s interest and principal and is also paying taxes. This is significant because company had moratorium for repayments till oct 12, and now since they are generating profits inspite of servicing their entire debt (which is very significant at around 310cr), it means the recovery is for real and sustainable and they have shown EBITA profits un-interrupted for last 5 quarters and this quarter profits even at net level. The recipe for success looks right this time around. The company has great block buster brands, has pricing power, increasing promoter holding, already started generating profits while servicing its entire debt, has two US FDA approved plants, and also started generating positive cash flows.

Valuation: This turnaround gem with sales of 400+ cr is trading at a market cap of just 85cr. The company has close to 17cr in cash and owns land worth 48cr and most importantly own two US FDA approved plants (which are its most prized asset). The promoters have upped their stake from 42% to around 49% (with 8% pledge) by way of warrants issued at 37.5 rs. With other pharma companies being valued at 5-12 times their sales, this turnaround gem has been away from the radar of investors and is therefore, available dirt cheap at just 0.2 times the sales (yes you are right the valuation gap is too big to be true, 0.2 times VS 5-12 times). As the company keeps churning profits this gap will slowly but surely get filled and thus could give massive returns in the years to come. The company with its great brands and assets would either grow to become very big or be taken over by some other aspiring company. Remember Ranbaxy which was taken over on good valuations despite its US FDA issues and massive debt, on the other hand this company for its size has wonderful brands and no US FDA issues (food for thought).

Technicals: The Company has broken out after a consolidation of close to 4.5 yrs and is looking extremely strong with hardly any downside. Even after the stock market carnage of last few days, the stock remains unaffected and is consolidating very well, especially with very low volumes on down days.

Note: Researching this company has taken a lot of time for me personally because it had a great history that went awfully wrong and I had to be sure that this time the recovery is real and more importantly sustainable. I had this company on radar for quite a few quarters now and have interacted with management multiple times to be sure about the prospects. I believe personally the company is on the right path to become an attention grabber and could be the story of next 3 years. One should not dismiss such company by just one bad quarter and should look at the bigger picture always. For example, mar quarter was an aberration where its EBITA was flat (that was mainly because formulations division had an abnormally bad March “month” ) but then it bounced back strongly in the next quarter to not only give a strong EBITA performance but also gave profits at net level. Remember it’s hard to go wrong in a company that has great brands with good pricing power.

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367 Responses to Wanbury Ltd. – A Turnaround Specialist Turning Itself Around

  1. pp says:

    Thank you, but i would prefer if you posted midweek. now i have 2 stocks to attack on tuesday. i guess will need to sell some other.

  2. MyInsignia says:

    Good pick with caution.. Nice I put Wanbury above Bilcare .

    God Bless

  3. Kesh says:

    What is ur view on prima plastics?

  4. Birsha says:

    Hi ace..
    Thanks for recco. I am wondering in case of suzlon you said that conversion of fccb into equity shares is a negative for the company. However Wanbury has also issued equity shares to fccb holders which might br dumped in the market before share price reaches 138..Is this conversion any different from suzlons conversion of bond into equity?? If its not then how come you dont see this as a negative??

    • Most of them already converted so hardly any incremental equity dilution will happen… I am not worried about them dumping at 138 as by that time we would be sitting on three fold gain. Conversion price matters a lot… Hope I could clear your doubt

      • Sharma says:

        What is the significance of Rs.138 here . 138 is the conversion rate . since the price is quoting below that rate ,remaining warrants will not converted and company liable to pay back the amount

  5. Mainak Paul says:

    Around what price one should enter ? tks in adv.

  6. Birsha says:

    Hi ace,
    Another point to be noted is wanbury has decided to wind up cantabaria while senvion has become a profit making subsidary of suzlon. Considering both companies have run into trouble due to accuisitions , just trying understand your logic about stock picking ( please note Though I am
    Following u recently.. I do have immense faith in your logic) …

    • oh no, i am not bothered with alternate perspective. I always cherish that. By the way, the equity dilution hardly happened for Wanbury because most of bonds were converted to debt as the coversion price was way higher. Very few opted for conversion. On the other hand suzlon’s coversion price was not a problem, so most of them got converted to equity. So to compare equity dilution of suzlon with wanbury is like comparing apple to cheese.

  7. sanjeev says:

    Hello ace… regarding API i was once researching ANUH PHARMA … appreciate your views on it

  8. Yogesh Bathia says:

    Ace you said you have interacted with the management a couple of times.. However I 1st saw this stock In the last qtr when it’s EBITDA margin expanded from 8% to 13% I’ve been trying to get in touch with them since then.. The CFO or anyone frm the management refuses to meet.. Can you share your contact pls..

  9. ram says:

    Dear Ace Investor,
    I am just reproducing an article from a newspaper related to wanbury here for understanding the risk factor. Awaiting ur comments…

    Hutton Group Files Winding-up Petitions against 2 Cos

    British Virgin Islands-based finance company Hutton Group has filed winding-up petitions against drug maker Wanbury and export house Faze Three for non-payment of bond dues,according to people familiar with the matter.Wanbury and Faze Three had raised 2.7 million and $2.14 million,respectively,from HGL through the issue of foreign currency convertible bonds (FCCBs).However,both companies failed to redeem the bonds,forcing Hutton to file the petitions in the Bombay High Court.According to the petitions,which were reviewed by ET,Wanburys bond matured on April 2012 while Faze Threes expired in October 2011.Both companies did not respond to ETs emailed query on the development.On Friday,Wanbury reached a settlement with bondholders while Faze Three,which exports textile to multinational retailers Wal-Mart,Sears and JC Penny,referred to BIFR.Wanbury has agreed to pay the face value of the bond along with 10% premium and 6% interest.The company will pay the dues in installments within four years.The offshore lender is being represented by Nishit Dhruva of MDP & Partners.Wanbury is the second pharmaceutical firm after Wockhardt to default on its FCCB dues.Earlier this year,Chennai-based Orchid Chemicals had to sell its key business to Hospira to pay off foreign dues worth $167 million.

  10. Sameer Anand says:

    A good value find ACE. I am sure this would go the Marksans Pharma way (another turnaround case) . Appreciate all your hard work.

  11. ankitkhaitan says:

    thanks for a good research report .. but i want to point that the market cap may be 85 crore because of the huge loan they have in their books so we cannot say that the real market cap is 85 crore.

  12. Kiran says:

    This is one worst pick from your side

  13. Rahul says:

    The debt equity ratio is very high for this stock. I won’t go near this stock.

  14. jai verma says:

    what about hutton group winding up petition of 2.1 million USD in court on defaulting by this company????????????????

  15. mitajakom says:

    Hi Ace,

    I want your view on why company’s results are fluctuating? In DEC they showed net profit, then in March in loss and then again in June Profit. You did mentioned that formulation has bad quarter in march, is it generally apply to all pharma company?

    • see, earnings would be lumpy because company is coming out of deep crisis. important thing to note is that the trend is very positive. for forumations last quarter is generally the worst among other three, but march month was abnormally bad for wanbury.

  16. Raj Gupta says:

    Nice! Sure to pick on tuesday.
    Ace sir, please need these stocks also ur attention DATAMATICS,THEMIS MEDI..share ur views plz..

  17. Rishab says:

    Hi ace, What’s ur view on Shakti pump, hov services?

  18. sam says:

    Hi Ace………What are your views on polo hotels?

  19. sam says:

    Hi Ace………does pending winding up petition filed by Hutton Group bothers you?
    How do you think they will make a payment of $2.1M with interest by next year??

    • when the company had defaulted their FCCBs, then its normal for bondholders to file winding down petition. But one should know that the settlement was reached and now just 48 bonds are pending settlement and they are shown as current liabilities, which would be paid in four years starting oct 12. It was done in 2012 and then the negotiation was inked. You are referring to an old 2012 news without giving the updates that happened thereafter.

  20. vijay says:

    Sir……your great…. you are like an Amir khan in 3idiots……all iz well…….
    I am very much convinced about this product ….surelly it will be 100 bagger in a span of 5 years…….. excellent stock pick………….if the results of 2nd quarter is good it will be a 10 bagger within 10 months……all iz well sir……you want to make small investors rich……i am 1crore % convinced…..it is a very big multi bager in the future….

  21. balrambhai says:

    Sir please give your views on Panchsheel Organics

  22. vijay says:

    Sir please tell your advice on drdatson laboratories limited

  23. Manvik says:

    Ace ur views on HOV services and patel airtemp and Shakti pump….

  24. mitajakom says:

    Hi Ace,

    This is a little offbeat but can you please tell me how to check royalty pay by an Indian subsidiary to it’s parent company in balance sheet? Is it covered under other expense?

    • nops, its covered mostly as royalty payments in the financial statements.

      • mitajakom says:

        Thanks ace for your reply.
        However, I checked bse website for HUL and Maruti both. I could not find any royalty related term in expenditure.

        All I could find it these terms.
        Other Expenses,Employee Benefit Expenses,Changes in inventories of finished goods, wip and Stock-in-trade,Depreciation and Amortisation expense,Purchases of Stock in Trade,Cost of Materials Consumed

        Can you please convey what am I missing here?

  25. amit says:

    sir – can you share your views on Sutlej textile and neyveli lignite at cmp

  26. Amit Gupta says:

    Hi Ace,

    top line is almost flat since past few years.How do u think it going up in next few years?

    • topline flat is for a reason right? did you read the annual reports? it will help you understand the company better. the topline has been flat because they have been concentrating on turning around their spanish subsidiary. The company has great brands, so now that they have started concentrating on growth topline growth has to follow. Remember the got new top management a few quarters back and the results are for all to see

      • Amit Gupta says:

        HI Ace,

        Continuing this thread, I dont see any good reason for not selling these established brands ( With pricing power also). Any good management will never sacrifice their daily bread & butter for tomorrow”s profit.

        • oh yes,it would amit. if your subsidiary is bleeding like that and that subsidiary is also putting a question mark on your survival its bound to take a lot of your efforts. but if either of your or your subsidary are way stronger and the stronger one is your real bread winner then its relatively easier. case in point tata steel and tata motors.

  27. Salim says:

    Sir, why are you cheating innocent small time investors for your personal gains? You know well that this is a worthless stock. Just because you bought this stock, you want everyone to buy this stock.

  28. Noobtomarket says:

    Just a small query , isn’t this almost as risky as Bilcare ? Both still have high debt and could take a long time to perform

    • bilcare has yet to start recovering anything. Wanbury has already started showing profits and is currently servicing the entire debt also. recovery has already started. good news is fccbs didnt dilute good too much equity. Bilcare has a long long way to go before it comes in the state of wanbury.

  29. Birsha says:

    Can you please explain your words ” most of bonds were converted to debt ” – i thought bonds itself are debt which the company has raised to fuel its capex needs , and will have to eventually pay back the bond holders with interest.. Hence I did not understand meaning of bonds were concerted to debt…
    Please excuse my ignorance…

  30. Khansalimx says:

    Hi ace some comments found on moneycontrol message…….kindly clarify to this messager…..I have no Agenda but I am one lost huge amount by acting based on such wrong informations provided in websites and blogs .So I will look through all directions and fight against spreading misleading informations . The blogger explained in his comment that the reson for flat topline is because of its concentration to turn around its Spanish subsidiary . But in reality company informed in BSE on 7th November 2013 that they filed voluntary insolvancy petion to wind up the said subsidiary.The news is still there in BSE and you can verify it.What treatment I should give to those who sharing these type false information to genetal public to mislead us.

    • yes, i indeed said that they were trying to turn around the company and that is the fact, but eventually when the new management took over they decided that turning around that company was not possible and therefore, they decided to get rid off the company. First they tried selling which was not happening and then eventually voluntary insolvency. By the way i have mentioned about company winding down in the research note in the “Background” section. Clearly someone is just trying to mislead people🙂

  31. B says:

    Thrte is fedtival to Muslim community called Eid and it wad yesterday. We couldn’t see any wish from you Ace. Any particular reason.

    • Oh yes, Its today as my per TimeZone🙂

      • ankitkhaitan says:

        please guys no hindu muslim here we all are indian …

        • Thanks ankit for writing this. i really wanted to say this ankit, but as a blog owner i thought it might offend the person who posted. It saddens me that to see this kind of attitude among readers. why cannot we move over all this man…i was really hurt to see it. Readers should know i have missed posting on a lot of festivals, infact i have missed most of hindu festivals..anways, lets move over all this in the betterment of our country and society. People send hate mails, call me operator, call me tons of things but i dont mind it, but lets not pollute our indian-ism. God Bless.

    • Salim says:

      This is heights of stupidity. This blog exists so that everybody can make money. This blog does not exist for sending greetings and wishes. How often have you seen Ace sir sending wishes for festivals? Just because Ace sir send wishes for one festival it does not men he has to send for each and every festival. Some idiots use every space for spreading hatred. Ace sir, one kind request, please block these kind of messages which spread hatred and block these users.

    • Prashant says:

      This is really unfortunate,
      why some one wanted to say there were no wishes for festival .
      If we look at the calender there will be festival for some community for every day .
      Just imagine if everyone start asking why there are no wishes for their festival .
      Lets keep it clean and related to stocks only .

      Thanks & Regards,

    • RaghuRam says:

      Mr. B, one small question. Why are you waiting for Ace to post his wishes for Eid? If your intentions are good, you should have wished Ace and every blog reader with “Eid Mubarak”. This shows that your intentions are not good. Your intention is just to spread hatred. If you want to spread hatred, please do that in some other place and not this blog.

    • Salim says:

      This is heights of stupidity. This blog is for people to make money and not for sending greetings and wishes. Just because Ace sent wishes for one festival, it does not mean he has to send wishes for every festival. Tell me how many times in this year Ace has sent festival wishes? I am sure you won’t answer that.

      Ace, one humble request. Please don’t entertain these kind of hatemongers. They simply want to use this space for spreading hate messages. Please block these messages and these users. It really hurts to see these kind of messages.

  32. venkatesh says:

    Hi Ace,

    Whats your view on NCC rights issue, issue price @ 20 and CMP @38.
    This will be my first rights issue application, so wanted to check if there is something i need to check before i go ahead.

    Will appreciate your view.!!!

  33. Anil says:

    Hi take a look at sterling bio , almost same type of hostory

  34. pp says:

    Mate do you recommend entering waterbase at cmp? im hearing good stuff about it.

  35. hitesh says:

    Sorry Ace……….Not interested in This One………..Management is serious abt debt level…….NOT CONVINCED ……Really Bad one

  36. venkatesh says:

    Hi Ace,

    Your view on any of the following stocks:
    Natural Capsule
    National Fittings Ltd
    Glance Finance
    Sri KPR Industries

    • only natural capsules from the list is good

      • pp says:

        is glance finance operator driven? its non stop on uc. Hes seeing all these companies from screener. ## Is morepen labs anygood? i had bought it at 5rs, then went non stop uc for a month, now non stop lc. i want to free capital but i cant😦. Also i take back my previous comments earlier after some further research. Numbers still shit though. None the less – #Respect

        • morepen is very big market cap and i prefer smaller market cap, plus i am not convinced about morepen’s business as of now. As you know i like turnaround stories a lot so normally their numbers are shit, but what matters is that if that shit can be converted to biogas or manure, you’ll make tons of money. Everything is opportunity if understood well.

  37. ravi multani says:

    hello ace
    i dont understand mentality of some people…why they hate u…u r helping us and giving good stocks if somebody dont like then he should avoid instead of critisizing u….this type of people r 2% of 100%…v all love u..god bless u…dont entertain this type of people who dont respect u….

    • i dont know ravi, but i think i have started to take it in stride. first time every new accusation hurts, like today’s religious bias, but probably next time when someone would say this again, it may not hurt that much. Anways, god bless all the souls.

    • MMB Cleaner says:

      Who will respect people like Arun Stock Guru, Valuepick,Aceinvestor ..etc..etc

    • Prashant says:

      Hi Ravi,
      Me too do not understand . Peoples are ready to pay to so many brokers for tips and many fund managers for recommendations . Here they get stocks that can multiply their wealth along with so many queries answered for free .

      Looks like lot of peoples out there who do not like some one who helps small fishes like us to earn knowledge and wealth . Or may be these are the peoples who requested for disclosure of stock name before posting on blog but AceJi did not entertained them .

      Anyhow whenever I see gentle reply of AcejI to such elements, I start him respecting more .
      Thanks & Regards,

      • oh yes prashant, it is possible, because some brokerage houses (or that’s what they claim to be), send emails for collaboration and when i deny they ask me to reconsider than be sorry later…maybe its that too…well anyways, no worries till others are taking it as an opportunity …

  38. Khansalimx says:

    Appreciate Ace/Others….This blog is to make investors rich…..lets not get into religious matters…Ace is doing an excellent work in creating wealth for all readers…..Ace suggest and best is to not post religious messages/greetings on this blog. You may need to post a clear message to all.

  39. ravi multani says:

    dear mmb cleaner
    if u dont like him then dont come here nobody is forcing u to do so…..

  40. ravi multani says:

    Jab log tumhare khilaaf bolne
    lage … samajh lo tarakki kar rahe ho…..

  41. Rammohan says:

    Hi Ace,
    Can you please let me know what is the ideal portfolio size.I know its not possible to give exactly, but if you can give a range It wud be really helpful.
    Thanks in advance,

    • Not sure if i understood your question but let me answer it…It would wary from person to person and with his living style. So basically, if you have an portfolio with yield of 2% and your living expenses are say, 10lacs/annum, you need to have a yield of 10lacs as yield then the portfolio size should be around 5cr so that you can live your life comfortably. If the yield of portfolio is 1% then size of portfolio should be around 10cr and if yield is 3%, then portfolio size should be around 3.34cr. did it help ?

  42. RaghuRam says:

    Sir, what is your view on Nile? Is it good for long term investment?

  43. Gita says:

    Kindly give your view regarding Texmaco Rails , Stylam Industries….

  44. Thank you for your efforts in bringing this to our attention. However, I have a query. You say the company is servicing the debt, but from the “Secured Loans” heading under Moneycontrol financials tab, it shows that secured loans have jumped to 374 cr from 342 cr, it is almost at 2009 levels again. What could be the reason for this? I agree that company is servicing debt, but it is surely not decreasing it?

    • tushaar, i dont user moneycontrol so dont know what it is saying. Lets concentrate on long term borrowings only because secured loans would also include working capital loans which is meaningless to consider. long term loans is 310cr. Please use annual reports, because that gives the best picture. I guess you have included working capital loans which is around 64cr

    • Ravi says:

      Tushaar, TV Today is not a large cap. It’s market cap is just 1200 crores🙂 This is a small cap company. TV Today is a very good company but that is my opinion.

      • ravi i also agree with your take on tv today. i like it too…

      • Haha, I said “larger” not “large”. The devil is always in the details. But I thank you for your reply. I still have a question though, do companies like Carborundum and TV Today take longer to give multiple returns than companies like Wanbury. I guess they will, since larger capitalization means safer investment. Safer usually means less rapid but more sure growth. Am I right in this?

        • tushaar, i have a very different take on this, large cap does not mean safety, thats a myth. market punishes bad performance equally.
          Remember suzlon, HFCL, unitech ….what they were and what they are now? some are down 99%, then what makes people think that
          its safe. On the other hand, multiplying the market cap is directly propotional to growth. Now a company with 50k cr market cap,
          if it keeps on growing at good pace the market cap will multiply, case in point ITC, but if growth isnt there then no matter,
          what ratios the company has (RoCE/RoE/RoA whatever you follow), the market cap remains stagnant, e.g. HUL. Ditto with small caps,but its easier for small caps to grow at 30-50% CAGR and therefore, market cap multiples more and therefore, without equity
          dilution, the stock price will multiply more. As far as safety in small caps is concerned, if the small cap is growing, safety
          is there and if the stock also has a yield, then its super safe. i hope i could cut across my point here.

      • I agree with both of you, Ravi and Ace. However, what I have noticed is that small investors are very quick to dump small caps when overall sentiment is even slightly negative. On bad days for the market near 20th September onward, my small caps all fell 5-10% each, whereas large caps still got away with 0.50-1% downside. Of course, similarly my stocks rose again next day almost 5-7%. I just meant to say since larger caps have some measure of established confidence, investors dump them with much more caution.

        On another note, do you guys use any board or forums to discuss ideas/thoughts etc? This seems a very inefficient way of holding a conversation!

        Again, many thanks for taking the time out to answer my questions….not many such people around.

    • Ravi says:

      Tushaar, always remember this

      There were many large caps which have become small caps now and
      there were many small caps which have become large caps now

      Now you tell me, whether small caps are risky and large caps are safe. I don’t think so. Both risky and safe stocks exist in small caps, mid caps and large caps.

  45. amit says:

    sir whats ur view for manjushree and hexaware ?

  46. srinivas says:

    Hi ACE, i want to know your view on Majestic auto..for medium term perspective

  47. Power says:


    What do you think on Aries agro

  48. Khansalimx says:

    Hi Ace, How is Gujarat Borosil for long term and if Aimco had to be purchased at what level it should be brought as it has picked up from 18 to 79 as of date. WIll both be multibaggers.

  49. Sudhakar says:

    Hi Ace,

    You have mentioned that you are researching about IFB agro. Do you have any view now?

    Also, please help to understand how to get the necessary info (that is not present in the Annual Report). I tried to get the answers through the email. But I am waiting for about 10 days and no reply yet (in spite of mentioning my DP details).
    1. Am I expecting the reply too quickly?
    2. Should I call them to get more details?
    3. Is there any regulatory procedure to escalate this behavior to the SEBI?

    Thanks in advance.


  50. Jay says:

    Hi Ace,
    Promoter sold 32272 shares of aro granite on 26.09.14. i think its bit negative for the stock

  51. sam says:

    Hi Ace..what are your views on kopran at cmp?

  52. mayur says:

    See Ace, despite of lot of criticism by some punters…Wanbury opened in UC…and looking at the pending orders and traded volume, dont think it will come out of UC..we’re still waiting to buy it…what to do now? Anyway I’ll go for it whenever it comes out of UC.

  53. viswanath says:

    HI,Ace,please give your view on Morepen lab.

  54. mayur says:

    As you mentioned that you like Waterbase a lot, but can someone take position in it at around 71 RS, if not entered earlier, keeping long term views…?

  55. Sameer Anand says:

    Hi ACE,
    Couldn’t buy Wanbury today. Hope it doesnt go with circuits to 70 levels like Aimco!

    Also ACE, please advise whetehr I could invest in Auriopro solutions at 275-280 levels?


  56. Keerthan says:

    Hi Ace,
    Could you let me know your opinion on Dynamic Industries?
    Thanks in advance.

  57. uday says:

    sir i have just started following your blogs.sir your understanding of balance sheet and business is very good .sir following are the list of my portfolio .u pl share your view
    1 caplin point . 2 banaras beads. 3 bibcl 4 astec life. 5 trigyn tech. 6 stylam 7 keelton tech. 8 mindteck 9 unique organic. 10 bliss gvs pharma

    thanking you

    • caplin point good..banaras beads get out if you can. asetc is fine, trigyn under research so no views at the moment, unique organics do not like at the moment…stylam is bad…keelton already replied, mindtech not interested…rather than bliss i like cupid more at the moment

  58. uday says:

    i just started reading your blog so i dont know where u have written about keelton .so pl share your view about keelton

  59. indianbull says:

    Ace, is your view still the same on V2Retail? It was up today in a weak market? Still a hold?

  60. pp says:

    Ace, How do i get the shares you recommend. its like a lottery. You could a try a social experiment, find a company which cmp is 250+ and lets see if it goes on uc.

  61. serene says:

    oil, coal and gas fallen………any alternative energy like Solar and Wind…any stocks for long term….!!!

    And also E-Commerce…I think next boom….any stocks for long term….!!!

    • if there is anything i’ll definitely post here

    • indianbull says:

      after re-reading his question, i think ur right Ace. he’s asking about pure ecommerce play. doubt any such company already listed. likes of flipkart,snapdeak,jabong,etc

    • indianbull says:

      Ace, whats ur views on such sectoral booms? I am kind of scared of the busts that follow the booms – cement boom(1992), dot com boom(2000) and the subsequent busts, in 2008 there was boom in offshore companies, llikes of aban hitting 5000, alphageo hitting 1000 which later crashed to 250,21 levels respectively. I am invested in V2 and seems the next boom could be the retail space including ecommerce. How to safeguard oneself from the busts that could potentially follow in this space as welll?

  62. Sakshi says:


    Last time you put a report on Aimco after VP given many clues about his next pick as Aimco . Are you also a follower of VP’s blog and inspiring from that ?

  63. viswanath says:

    Aceji,my trader bought cupid trades instead-of cupid rubbers. can i hold this? please give your valuable suggestion.

  64. viswanath says:

    sorry, today only it was happened.

  65. nirav karia says:

    Sir thanks for wonderful pick.. Sir can u pls share our views on following companies:
    Force motors
    Polyplex corporation
    Sudarshan chemical
    Deepak nitrite

  66. sam says:

    Ace do you know why v2 retail fell from 1000 levels to 7??

  67. Sahil says:

    Hey Ace,

    Can you please share your views on Helios & Matheson IT Ltd from both fundamental and technical perspective ? Wanted your opinion before i take a position.


  68. Praveen says:

    Hi Ace,

    Which are the stocks you are actively researching currently?


  69. mayur says:

    Hey ACE ji, look at the pending order for Wanbuty.. its over a lac and traded only 13k…and its 9:33 in the morning….seems like its not goin to come out of UC anytime soon….this is another Aimco…will be in UC for a week for sure…..dont know how to buy this…??? m eagerly waiting…

  70. Ashutosh says:

    Sir please share your views about meghmani organics ltd., IDBI Bank & Pennar Industries for fresh entry. I can hold for very long.

  71. thakral says:

    wts ur view on Avt natural…when your next pick is coming

  72. Jay says:

    Hi Ace..
    Do you track Gujarat Automotive Gears Ltd.?
    Its plant located in Vadodara, Gujarat and supplies Auto & Tractor Components and majority of its revenue comes from European Markets.
    ROCE > 35%; Zero Debt;Dividend paying company;Trailing PE is 11.95

  73. a.p. says:

    Hello, agrochemical business in india is cyclical. Most of revenue comes in q4 and q1, am I right?
    And for export Oriented companies, fluctuations reduce to a good extant. So qoq is also as reliable as yoy for such companies?

  74. KN says:

    What is your view on SMS Pharmaceuticals and Polyplex?

  75. Ram says:

    Is Mold-Tek Packaging good for long term?

  76. vijvins says:

    Please advice on stocks which are there in my portfolio..
    1. Sanghi industries
    2. Aimco pesticides
    3. Munjal auto
    4. Freshtrop fruits
    5. Cupid rubbers
    6. Ashok Leyland
    7. Ifgl refractories

    Please advice on above stocks for long term… Some of them are falling down… Please I need a valuable opinion

  77. RaghuRam says:

    Ace, is Lanco Industries good stock?

  78. charan1979 says:

    sir, pls share your view on Amtek auto

  79. Mohan says:

    Sir, can you please share your view on Sam Krg Pistons and Rings?

  80. Mohan says:

    Not sure whether my previous query got posted. What is your view on “Sam KRG Pistons and Rings”?

  81. Mohan says:

    What is your view on “Sequent Scientific” sir?

  82. a.p. says:

    currently almost debt free Aimco, in recent agm, has passed resolution to borrow upto 1000cr!! Any new plans ahead that they put such a giant no for resolution?

  83. k.c. says:

    What are your views on Jay Bharat Maruti?

  84. Ashutosh says:

    sir your views on KEC International

  85. mayur says:

    Finally we are able to buy it today around 50…m sure Wanbury will turnaround this fiscal for sure…

  86. Raja says:

    Sir – have a query. Since the prospects of Wanbury is exiting wonder who is selling? It seems to have come off the circuit sooner than we thought.

  87. Kiran Kumar says:

    To day i entered Wanbury @50.55 for long term

  88. Dinesh Agarwal says:

    Kellton Tech Solutions – Another RS Software?
    sir kellton has prestigious client like PVR, NDTV, Makemytrip and many more.
    Promoter increased there stake in june 2014 by 4%
    They are aggressively expending there business.
    in last 2-3 days market was in correction mode still it was in UC.
    In directors report I had seen they not paid dividend as they use those for expansion plan it means they need lot of funds from us :))
    They had been awarded : “Top 20 Travel &
    Hospitality Solution Providers 2014”
    LINK : travel-hospitality.cioreview.com/vendors/2014/20special1
    I am sure it will be another RS Software in coming days.
    Sir, please research More about this co. and recommend if we invest in this co.

    • already replied about this company..

      • Dinesh Agarwal says:

        In future everyone will run after Kellton like RS Software I bet u😉
        I am a tech guy and know about its valuation what business they are serving and it will also give competition to 8k miles.

        • i hope so…i have not reasearched it in depth but overall, i didnt find anything…i will reasearch it, but 8k i liked it coz the products..i like only products business…by the way i am a tech researcher myself🙂 ….good to see people like you also into financial planning

  89. Arun KP says:

    AceInvestor Ji,

    Your view on Majestic Auto

  90. Geetha says:

    Ace ji your view on kellton tech and zicom security please

  91. Darshan S. says:

    Dear Ace,

    What is your opinion on ” SKM Egg Products Export (India) Ltd. ” ?

  92. Power says:


  93. Ankit says:

    Hi Ace, any views on Shreyas shipping?

  94. abhishek says:

    Hi ACe, why the likes of Omax auto, Rathi bars and Makers lab haven’t seen the kind of rally they deserve based on their financials, high margin of safety, honest promoters, and good track record… !! can you please cover these stocks and suggest something…. ?

  95. abhishek says:

    Particularly, Makers have the same promoters as IPCA labs, was a dividend paying company 2 years back, and top of it already hold 0.08% of IPCA, worth 8 crores, this means out of the total market cap of 18 crores, you are paying only 10 crores for company’s own business of generic APIs.!!

  96. Rohit says:

    Hi Ace, How are the prospects of Amtek Auto, is it advisable to buy at around 190?

  97. Noobtomarket says:

    Ace ji , you said 8k miles not at this price but It keeps going higher and higher , I feel like missing out,Isn’t it still a good buy ?

    • if you are convinced then you should not be asking me right ?

      • Noobtomarket says:

        i am never convinced about the entry price haha. It always seemed expensive but it just keeps rising and the result was extremely good . Can it become another thing from Silicon Valley ? I don’t want to miss it out if it becomes something massive in the the future .Huge companies get created in Silicon valley ,that’s all i know. I lack experience in markets , that’s why i asked you .

  98. Sriram says:

    Dear ace,

    I got it @49. Following is my portfolio, your recommandation please.

    Cupid rubber, Aimco, Delta corp, Dr. Datson, GSFC, Hcl info, Praj industries, shipping corp, sterling bio, v2 retail.

    Many Thanks,

  99. Sriram says:


  100. Srinivasan N says:

    Sir I am impressed with your valuable research as far as Wanbury is concerned. But unfortunately I do not have sufficient investible funds to buy wanbury. Can I go for Morepen Lab as this is also from pharma sector and I hope its doing resonably good. Also I can buy more shares of Morepen with my investible funds. I appreciate your valuble feedback to act accordingly

    • number of shares do not matter….what matters is the amount of capital that you invest. If you buy 1000 shares of rs 10 and if you buy 200 shares of rs 50 both are same thing. if you can invest in morepen, there’s no reas why you cannot invest in wanbury or liberty or page ind.

    • pp says:

      Morepen is full scale operator driven stock. it will suck you in and suck you out. I hold morepen since 5rs, It didnt move for a long time, suddenly out of no where it went on upper circuit to 15rs and now non stop lower circuit. So be cautious to invest in current prices. This can be very high risk and reward though.

  101. rajesh says:

    will strike effect its price sirji pls update us

    • the management itself is saying that it might affect some part of production

      • So Price will be down next 2 days ?

        • how can i know what will happen in price for next two days…normally the product is not affected much because for such events or fire events, companies then outsource the production for sometime. Also, management is saying that production is hampered partially. Also, investors should know this is not the only plant with wanbury…. for someone who was interested in the business and brands, this could be a god sent opportunity to take the plunge if at all…

  102. should i Take chanse to buy current cmp ?

    • be a scuttlebutt it helps…i would suggest you to go to nearby chemists (3-4) ask about the brands that wanbury has, you will never ever have to ask this question again and all your doubts would remove…. in long term these brands could take wanbury to next level… uncertainty lowers risk (because prices get very depressed)…remember this…

  103. akii says:

    sir, what is your view on Resonance Specialties Ltd, their unique products and their specialisation and their future market

    • its ok… but i am not convinced enough to take a plunge.

      • akii says:

        few positive i see is
        1. old company
        2. profit making company
        3. promoter stake is good 67%
        4. trade at lower 1.15 of book value
        5. first time company paid dividend i.e 0.50paise
        please read this what company claim,
        “Resonance Specialties Limited” is a pioneer in Pyridine chemistry and one of the few manufacturers of the product in the world. The company, formerly known as Armour Polymers Limited, was the first in India to manufacture Pyridines. Resonance is also one of the largest manufacturers of Lutidines in the world

  104. pp says:

    Ace, what is gts-7? since the time wont matter weather he post early morning or now?
    I seriously thought it was Skm egg products but i have my doubts.

  105. pp says:

    The disappoint part is i knew it since day 2 that it was skm egg but i wasnt convinced to act, but when i decided to act it was uc… None the less. This was actually good fun. Why dont you put something up like this? it educates investors and at the same fun.

  106. Hi ace investor,

    Has there been a change in the management…Pls confirm what you meant by “Remember the got new top management a few quarters back and the results are for all to see”.

  107. Hi ace investor,

    Has there been a change in the management of Wanbury…Pls confirm what you meant by “Remember the got new top management a few quarters back and the results are for all to see”.

  108. Sanjay says:

    Hi Ace, Happy Diwali !!!🙂
    I am invested in stock Market from last few months so very cautious. I am reading your blog from last few days so I invested in Wanbury yesterday at 45.5 for atleast 1 year. Is the price right in current market? Also, I was getting profit on few stocks with me but those were heavily declined in last few days.😦 Can you please suggest me how should I book profits with time and when I should exit in case of loss. Regards,

  109. Sanjay says:

    Sorry, Please ignore my message where I said that my query is deleted. I can see now
    Please reply first one

  110. vsanjay427 says:

    Hi Ace,
    I am new to stock market and reading your blog from last few days. Yesterday I invested some money in Wanbury at 45.5 price. Is this price right in current market situation? Also I was earning some profit in my stocks which got declined in last few days. Please share views how we can book profit with time. I invest for atleast 1 year.

    • if you are convinced about a story, a bit of volatility you have to take in stride …thats part of stock markets…there’s no right time to sell a stock, its either when the story is finished, you need money or you have a “significantly” better story in mind. Other strategy is to have return focussed investment, i.e pick a good story and invest to target say, 25% return and take it once it is there… if the stock goes down, you wont feel bad, but if a story is good, it will go up and then you’ll realize that the story had legs and you had identified the right stock…slowly once you repeat this and your successes outwit your failures, and you learn to make money (making money is important to gain confidence in stock markets) you’ll start getting confidence and then you can work with buy and hold strategy rather than targetted returns strategy.

  111. Hello Mr.Ace

    Wanbury Ltd has informed BSE that union workers at the Company’s Tanaku, Andhra Pradesh Plant has gone on strike affecting the production partially in that Plant.Management is making all efforts to get back the production to normal capacity.

    Do you think this will have negative impact on company? It is still safe to buy?

  112. vsanjay427 says:

    Got it. Thanks a lot Ace🙂

  113. Jay says:

    Hey ace did you notice September SHP promoter have pledged 99% shares. And now total pledged shares goes to 69% from 8%. Doesn’t it bother you.


    • Yes it would if the prices were to follow drastically but so far it’s always held on to its own so right now I am cautiously optimistic

      • Jay says:

        By any chance do you know the result date.. Have searched on bse, couldn’t find one.

      • Hari says:

        Why you are changing your tone , earlier you were upbeat on this and now only cautiously optimistic . What should I do , I bought shares mainly on the basis of rosy picture painted by you ?

        • rosy picture painted by me??? you do not have confidence in it ? why havent you done your research…did you go to your chemist and ask about the brands or not ?? and how did you measure the tone from my words… As always said in this blog, research and then only take the plunge. Clearly you have not done anything and thats why feeling the jitters. There’s absolutely no change in my view

  114. vsanjay427 says:

    Hi Ace, Any views about India Bulls Wholesale services. They declared there quarterly results today. Should it be hold or sold? Please share views.

  115. venkata says:

    Hi Ace,
    Nice to see people like you are helping retail investors in a big way by posting multibaggers much like cupid’s so on. Can you please comment on Arvind Remedies invested heavily @44.60 which was recommended by well known brokerage houses giving targets to 70-120. In my home work I found that it is very much undervalued pharma stock with 4.43 with profit growth of 70% for last five years. I see it as safe bet. Please wirte your opinion on this. It will help me alot.

  116. vsanjay427 says:

    Hi Ace, Any views on Parabolic Drugs please share. I have bought at 17.20. Currently it is 12.90. Should I book loss or hold it. Also, If you suggest to book loss, any other undervalued scrip I can invest this time as market is very high. I am already invested in Wanbury.

  117. akshay agarwal says:

    Hi ace
    First of all great research. Thanks for the picks.
    I have a few questions regarding Wanbury. Will be glad if you could help out.
    1) As i can see yearly payout on long term borrowings is approximately 35crs. Considering yearly depreciation of 16crs also. Unless the company is able to make a PAT of Rs20crs for the next 3 years and a PAT of 45 crs for the 3 years after that, it will be short of working capital soon. Moreover, these yearly payouts are exclusive of the maturities of the long term liabilities mentioned on the balance sheet. So considering that the company has not been able to be profitable for the last 3 years. Do you think that they will be able to record such a sudden bump in profits? Or do you think they will need to fund the long term maturities through new short term borrowings?

    2) Are other foreign subsidiaries in sound health? And will these subsidiaries be able to generate profits to fund repayment of Wanbury’s long term borrowings?

  118. acefollower says:

    Sir why wanbury is not maving up in spite of uptrend in the market? Is there any bad news associated with it?

  119. vsanjay427 says:

    Hi Ace, Please share views on Vidhi Dye Stuff . Buying at 10 cmp is 9.30. Bought for 3-6 months view. Regards,

  120. vsanjay427 says:

    Hi Ace, Please reply to the query.

  121. ajithapriya says:

    Thanks a lot AceInvestorTraderji for bringing the stock in focus. Looks good also based on cause and effect theory of Wyckoff(Long Consolidation since 04.11). Hope the volume picks which would add strength to the breakout.

  122. Rohit Gulati says:

    Dear Ace,

    First of all thank you very much in taking effort and patiently answering all the ques. posted to you. Do you have any idea why there’s strike at Wanbury plant and when it is expected to be sorted out?

  123. Rohit Gulati says:

    I read it on moneycontrol….not aware whether it is called off!

  124. Rohit Gulati says:


  125. akii says:

    sir question is why wan bury NP and G.P margin is so low compare to other pharma stocks.

  126. vsanjay427 says:

    Should we hold Wanbury as result is on 26 Nov. Less movement in stock. Regards,

  127. vsanjay427 says:

    Oops😛 Seems I ask wrong question.Sorry. Got it Ace, I am invested here for long term.

  128. mummba says:

    Wanbury going down any specific reason.
    Shall we try to sell and come out. Please reply. I am in big loss.

  129. Rohit Gulati says:

    Dear Ace,
    Could you give an update on Wanbury ….as to the below expected result of the Company on the Operations front,as it incurred EBIDTA loss and what was the one time exceptional write off.

  130. Rohit Gulati says:

    Yes…why has the raw material costs gone up drastically….without corresponding increase in revenues.Does it means that the company has no pricing power and there’s lot of competition.So going forward this is going to hamper the bottomline.. Am I correct in thinking so? Thnx.

    • i agree with you question…even i am not sure, have written to the CS (plus a few more questions)…have you also written to the CS? no the company has pricing power…please read their last year AR

  131. Rohit Gulati says:

    No, I have not spoken to the Company.Will do so…

  132. Hemantraj Dixit says:

    Hello Ace, Why the stock has been on a decline since 25th April. The fundamentals look great but I can’t understand the fall. Please help….

  133. Shiva says:


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