Saturday, January 30, 2010

RishabDev TechnoCable

I recommended this stock to few people when it was around 17 RS.(now CMP is 11 RS )expecting that company is going to give good results with EPS around 10, but now i think its not going to make it. Now a days i started analyzing balance sheet and the interesting thing which i saw in the balance sheet of this company is its paying more then 1/2 profit as Tax and interest expenses.

Question: why is it paying so much interest rate?
Coz it took loan to run its business and the business is not making enough money to repay it
Question:why business is not making money?
answer i know its its total cost of raw material is increase rest all components remain the same from previous quarter
Question: What is the future price movement?
I expect the stock to fall for some more time and settle around 4-6 RS

And also i started looking at Gordon Growth model..hope i can place this over there and see where it ends up..Will see where the slide stops at

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