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Microcaps-When will value.be unlocked?
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jstk
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Quote jstk Replybullet Topic: Bombay Swadeshi Stores-long shot ......bu
    Posted: 07/Oct/2006 at 3:20pm

Bombay Swadeshi Stores ltd –BSSL [ 531276 ] is not a classic stock { packed with value but underpriced.}

 

The company was formed by freedom fighter Lokmanya Tilak exactly 100 years back as a stationery retailer .The present management headed by Asim Dalal [ 63% stake ] started the 1st store in its current format 11  yrs back.

 

BSSL is a niche retailer [ there is a uniqueness about the products and shopping experience they provide ]and operate under ‘The Bombay Store’ brand. They have 2 stores in Mumbai [ PM Road, Fort & Airport ] , Bangalore [ MG Road] , Pune [ MG Road ] & hyderabad – Banjara hills – franchisee outlet.

 

They retail Home Accessories [ Artefacts, ethnique lamps & shades, candle & candle stands, table & kitchen ware], Personal Care [ Aroma therapy, Herbal skin & hare care],

Fashion Accessories [ jewellery, leather & travel accessories] , Apparel, Soft furnishings & handmade stationery.

The products are very different from what one finds in any other large store selling similar products & have a traditional Indian / ethnique feel .

 

Foreigners contribute nearly 35% to the sales. The client profile is premium & average spend high.

 

The company says that it plans to set up stores in Chennai, Calcutta and plan to have 20 stores [ owned / franchised ] by 2010. The co will need to raise funds to implement this plan.

 

current equity is 63 lakhs, 06 sales were : 24 cr, OP : 2.4 cr & NP : 34 lakhs.

concerns:

  • Mgmt has as of now not been able to scale up operations despite being an early starter [ 95 ]
  • Asim’s dalal’s father was one of the brokers named in the Harshad scam.
  • the stock is very very illiquid 

What I like about this stock:

  • The Opportunity & potential is huge .
  • Virtually every 3rd foreigner who comes to the cities where The Bombay Store is present has it as a ‘must visit & shop’ place.
  • The brand pull amongst the high end shoppers is tremendous.
  • @ current price of 245 , market cap is 15 cr
  • take over by a large operator / fresh funds etc can take the stock into a different orbit. 

welcome comments / view from everyone.

jayendra

 

 

 
If you buy for a non-value reason, you will end up selling for a non-value reason.
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BubbleVision
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Quote BubbleVision Replybullet Posted: 07/Oct/2006 at 3:58pm
Jayendra,
you are doing an absolutely wonderful work by pointing out stocks which are absolutely out of favour and no one knows about them.
Thank You
Keep going
You can't make money if you are unwilling to lose...It's like willing to breathe in but not willing to breathe out. -- ED SEYKOTA ....Read Disclaimer!
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s_praharaj
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Quote s_praharaj Replybullet Posted: 07/Oct/2006 at 6:44pm

I never knew that the Bombay Store through which I pass everyday in Mumbai is a listed company.Daily, when I pass by the store, I use to wonder, who is coming for buying thingsd from this store. I myself have seen very few customers in this shop.Occasionally you see a few foreigners shopping from the shop, as it claims to be one of the oldest shops of Mumbai. I was surprised to see the sales of 24 crores. May be shops at other places must be doing better.

The management seems to lack vision. The store has a great real-estate value. I do not know, whether the property belongs to them. The management can definitely turn this store located in a prime location to many other viable things.

At present when I see the store, I dont find any encouragement  in buying the share. It may be a great investment , but I feel,(like Buffet said), its better to buy a successful company than to go for a company like this at this point of time

But thanx a lot for the information. I never knew about this company.
.
Shashi Praharaj
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Quote jstk Replybullet Posted: 06/Nov/2006 at 10:47am

Company mgmt has intimated BSE that they are meeting in the 3rd week of Nov to consider increase in capital by capitalizing of free reserves [ bonus issue ]. Considering the miniscule capital, a liberal bonus in possible.

I beleive a bonus per se does not mean any value add but indicates mgmt confidence about the fuure or can be a pre cursor to something else [ private placement etc ] .
 
hopefully mgmt has woken up to the huge potential of their 'Bombay Store' brand .
 
lets wait and see.
 
jayendra
If you buy for a non-value reason, you will end up selling for a non-value reason.
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Quote jstk Replybullet Posted: 20/Nov/2006 at 12:22pm
Bombay Swadeshi stores Ltd has declared a bonus issue of 1 share for every 3 held and a stock split with change in face value to Rs.2 instead of Rs.10.
 
Stock has run up to around 395. The current equity is too small [ 63 lakhs ] so any buyer with a purchase order of even 2000-3000 shares can run up the price so i would not read too much in the price increase as it can come down in a similar fashion.
 
However i strongly believe that 'The Bombay Store' brand has everything going for it - premium position, heritage value & a niche market.
 
If the management wakes up, the future is pregnant is possibilities.
jayendra
If you buy for a non-value reason, you will end up selling for a non-value reason.
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Quote Equity Buff Replybullet Posted: 20/Feb/2007 at 7:48am

JSTK,

Guess which is India's hottest retail stock. Yes, Bombay Swadeshi Stores. Well done. Since January 2006 the stock has risen 206% when the Sensex has risen 50% and Pantallon Retail the leader rose 36% and Shoppers Stop rose 56% in the same period. Bombay Swadeshi Stores Market Cap is still only Rs. 33 Crores against Pantaloon Retail's Rs. 6,163 crores. This has appeared in today's Mint paper (HT/Wall Street Journal).

Basantjee,
 
When looking for multibaggers isnt it better to look for stocks with market cap of less than 500 crores where scaleabilty (opportunity) is there in the industry and these stocks may not be the leaders (may not be among the top 3 in the industry) in that industry but have decent management with reasonable expansion plans and a niche market. Await your comments.
Of course nothing like spotting a Pantaloon 3 yrs ago when it itself was a small cap. But I am talking about now when opportuinty in Retail is still huge and even other companies like Bombay Swadeshi stores, who is not among the top 3 in the industry, can do very well in its own way. This stock also has a very low equity (scarcity premium). Await your comments.
 
Rgds
Equity Buff

 



Edited by Equity Buff - 20/Feb/2007 at 7:51am
"Time is on your side when you own shares of superior companies". Peter Lynch.
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basant
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Quote basant Replybullet Posted: 20/Feb/2007 at 10:38am
When looking for multibaggers isnt it better to look for stocks with market cap of less than 500 crores where scaleabilty (opportunity) is there in the industry and these stocks may not be the leaders (may not be among the top 3 in the industry) in that industry but have decent management with reasonable expansion plans and a niche market. Await your comments.
___________________________________________________________
That does sound appealing but the mortality rate is higher in the non sector leaders and while some companies would do really well we suffer from what is often known as a survivorship bias. The bad ones rarely get reported. Generally the best combination is a sector leader with Rs 500 crores or less of market cap.
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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Quote jstk Replybullet Posted: 12/Nov/2007 at 10:54am

Bombay swadeshi has given a notice to BSE that they will be raising funds through a pvt placement.

current m/cap @ 84 cr is nearly 6.5 times compared to last year november and the stock seems to be now out of the value ( Brand value ) orbit and heading into overpriced zone as the increase in share price has not happened on the basis of growing fundamentals but purely strength of it 'The Bombay Store' brand.
If you buy for a non-value reason, you will end up selling for a non-value reason.
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