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PANASONIC CARBON -- cash cow

Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Stock Synopsis
Forum Discription: A bried discussion of companies on very specific matters. Normally this is the prelude for further research as always members would be discussing quality companies with good management only
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=2602
Printed Date: 20/Apr/2025 at 8:27am


Topic: PANASONIC CARBON -- cash cow
Posted By: hit2710
Subject: PANASONIC CARBON -- cash cow
Date Posted: 05/Jan/2010 at 6:33pm

PANASONIC CARBON BSE CODE  508941

 

FORMERLY THIS COMPANY WAS INDOMATSUSHITA CARBON ESTABLISHED IN 1982.

THE COMPANY MANUFACTURES CARBON RODS USED IN DRY CELL BATTERIES.

TOTAL EQUITY IS  4.8 CRORES AND FACE VALUE IS RS 10.

MARKET CAP AT CMP IS AROUND 82 CRORES. (CMP 167)

FY 09 SALES WAS 30 CRORES   AND NET PROFIT WAS 5.9 CRORES GIVING EPS OF AROUND 12.

HALF YEARLY SALES WAS 14 CRORES AND NET PROFIT WAS 3.41 CRORES GIVING HY EPS OF 7.

FULL YEAR EPS EXPECTED TO BE AROUND 16-18.

 

CASH ON HAND AT THE END OF FY09 WAS 46 CRORES. NO DEBT ON BOOKS.

THE COMPANY IS GENERATING POSITIVE CASH FLOWS SINCE PAST 5 YEARS (that is as far as I have checked)

THE COMPANY PAID DIVIDEND OF RS 7 PER SHARE SINCE TWO YEARS AND RS 6 PER SHARE FOR PRECEDING 3 YEARS.

 

TECHNICALS:

 

THE STOCK MADE ITS ALL TIME HIGH OF 185 RECENTLY AND IS NOW IN CONSOLIDATION .

IT IS MAKING HIGHER TOPS AND HIGHER BOTTOMS FORMATION.

150-150 BAND COULD OFFER GOOD SUPPORT ON DECLINES.

THIS STOCK IS A STOCK WHICH COULD BE BOUGHT BASED ON CASH FLOWS, DIVIDEND YIELD.

THERE MAY OR MAY NOT BE FABULOUS GROWTH BUT AFTER DEDUCTING CASH FROM MARKET CAP, THE BUSINESS IS LOOKING VERY ATTRACTIVELY VALUED.

 

 



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Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart.


Replies:
Posted By: eagle
Date Posted: 05/Jan/2010 at 7:13pm
hit2710,
what is promoters holding  inthe company
 


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buy low sell high.

Posted By: hit2710
Date Posted: 05/Jan/2010 at 7:18pm
Originally posted by eagle

hit2710,
what is promoters holding  inthe company

 



Around 75%


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Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart.

Posted By: TCSer
Date Posted: 05/Jan/2010 at 7:46pm
Why is sales stagnating?

Posted By: hit2710
Date Posted: 05/Jan/2010 at 7:51pm
Originally posted by TCSer

Why is sales stagnating?


dont know why. cant get hold of their annual report. got all other details from religareonline.com.

This one reminds me of a pipe company whose example Lynch gave in one up on wall street which kept on getting cash flows without any appreciable growth in sales/profits.


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Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart.

Posted By: rishirich87
Date Posted: 05/Jan/2010 at 8:28pm
i dont think there is much scope in this business

Posted By: rishirich87
Date Posted: 05/Jan/2010 at 8:29pm
profit margin is nill

Posted By: smartcat
Date Posted: 05/Jan/2010 at 11:15pm
Don't know much about batteries - but topline is stagnant probably because this company's products are perhaps used by old school Zinc Carbon batteries.
 
Modern alkaline batteries like Duracell probably don't need these carbon rods?

Posted By: hit2710
Date Posted: 05/Jan/2010 at 8:50am
Originally posted by smartcat

Don't know much about batteries - but topline is stagnant probably because this company's products are perhaps used by old school Zinc Carbon batteries.
 

Modern alkaline batteries like Duracell probably don't need these carbon rods?


This is an ancillary company for the novino and everready kind of companies. But the majority of market share in India still rests with these companies. You will find them at every kirana store while duracell will be available at select outlets.

The company faces problems due to import of carbon rods by some dry cell battery manufacturers. Last year, instead of reducing margins/suffering losses they reduced production. They also mention that they have the infrastructure in place to cope with increased demands.

Basically as I mentioned earlier, this is more about value investing and not much growth. Growth if it comes through could be icing on the cake.

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Stockmarket is a weird place. For every person who buys a stock there is a person who sells it and both think they are very smart.


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