Cranes Software & Compact Disc…the Two ‘Cs’ continue creating Chaos

One of the major objectives of my Blog is to warn Investors to stay away from or reconsider the risks assumed in their Investment in certain Companies….the two ‘Cs’,Cranes Software and Compact Disc were covered earlier in my blog to serve this objective 

Thanks Saif for reminding me about Cranes Software…It has sunk to below Rs 7…I had warned about it on December 31,2009…..In reply to your response I think you can write this Investment off as a bad experience and a part of a learning curve  

Cranes Software at 52 week low of Rs 28…was Rs 100 just over a year ago…Waste or Worth ?

Thursday, December 31st, 2009

Thanks Ashish Pathak for your response on Compact Disc….It remains at Rs 65 even today…and you’ve been married to it for four long years !…I had reviewed it in detail on March 25,2010 and was not impressed with Corporate Governance and Liquidity Position of the Company….my position remains unchanged even today…but you seem to have more conviction here than I do…Live it if you’re sure and comfortable with the risks that you have assumed…otherwise look to switch

Compact Disc at Rs 87.20…Fantastic Surge past few days…is it sustainable?

Thursday, March 25th, 2010

Cheers !

Thinksoft Global crashes to Rs 221 (more fall indicated) from Rs 544 in just 10 trading days…..SEBI and BSE must probe this Company to maintain sanctity of our Markets

I had warned Investors of Thinksoft Global IPO in September 2009

Don’t ThinkHard about ThinkSoft Global Services’s IPO at Rs 120-130…Ignore it

However on Listing it kept defying gravity and on February 11,2010 it zoomed to a record high of Rs 544 with record Volumes

But since then in just Ten Trading days and Eight continous lower circuits,beginning with two 20% drops,then as lower filters were applied,a 10% drop,followed by now Five 5% lower circuit filters,Thinksoft Global has crashed today to a lower circuit of Rs 221.30

The Share Price and the Volumes were set up past one month…Have a look ….Something Stinks really Big Time Foul here

…methinks SEBI and BSE must quickly and conclusively bring the perpetrators to task,if they have to maintain the sanctity of our  Stock Exchanges and protect the sucker of the small Investor….

Classic case of Greed and Fear….we’ve seen such situations play up before too…like in the Austral Coke Company…dropped from near Rs 200 levels to under Rs 10 now

….The authorities must investigate any Promoter/Major Shareholder/Broker/Operator nexus in such cases…Such movements rarely occur without a criminal nexus…..Poor Retail and some HNWI suckers get trapped by this manipulation  

 Investor Education and Protection is one of the key purposes why I began this blog…to express my  concerns on several companies…In the recent past,Cranes Software and Karuturi Global…even Austral Coke ! and Thinksoft Global

However distasteful,unpleasant,bad,loss making Equity experiences should not permanently deter you from the Beauty of Equity…..A basket of Apples will have a few Bad ones !….Some are easy to Spot,some look great on the outside ,but are infested with Worms on the Inside……Learn to spot these worms and avoid such seemingly great Apples ! 

Be warned….There are many out there…. always on the Prowl to seduce you to lose Monies…because they make Monies,only when you lose !…and they have perfected the art of Seduction !….and think about this !…what chance do you stand against the 6000+ seductions listed on BSE !…and you will be double careful !

I reiterate my Quote “India and Insider Trading are Inseperable !”…which I discuss and debate in my sessions at various forums

Cheers !

Cranes Software at 52 week low of Rs 28…was Rs 100 just over a year ago…Waste or Worth ?

End October 2008,when the Sensex had crashed below 8000 from a high of 21000 in January 2008,Cranes Software (FV Rs 2) was at Rs 90 and yet rated a ‘Buy’ by a leading Broking House with a target of Rs 106….Had you invested,you’d have gone ‘Broke’ and probably be with the ‘Angels’…get the whiff!? 

Cranes is now at Rs 28/29…a 52 Week Low…there is a lot of interested buying that has led me to have a brief look at this scrip

While the Whole market surged in 2009,Cranes reversed from Rs 80 to Rs 28

This appeared strange at first,given the fact that for FY 2009,the Networth shot up from Rs 481 crs at March 31,2008 to Rs 632 crs at March 31,2009,helped by a bottomline of Rs 115 crs….Book Value moved up sharply from Rs 41.95 to Rs 53.70 and is likely to cross Rs 60 this year….P/BV is very low at @ 0.50….. Equity is Rs 23.55 crs giving an EPS of Rs 9.8…..Q1 FY 10 indicates this EPS will be maintained this year…Thus the PE is under 3

So does Cranes Look great at Rs 28/29 ?….Look again

EBITDA in FY 2009 was Rs 227 crs,up from Rs 191 crs and PAT was Rs 115 crs,up from Rs 95 crs….Yet the company crashed Dividend to just 10% from 60%….Rs 2.36 crs was the absolute amount…that’s barely 2% of the PAT !

Look again…The Company is obviously in deep cash trouble…Borrowings have increased from Rs 573 crs in 2008 to Rs 743 crs in 2009…These incremental funds of Rs 170 crs along with Cash Profits of Rs 187 crs (after Depreciation adjustment) give additional funds of Rs 357 crs….Where have they been applied ?…Look at the Assets…Gross Fixed Assets have increased by Rs 103 crs and Debtors by a whopping Rs 272 crs from Rs119 crs to Rs 391 crs…that’s 74 % of consolidated (+15 subsidiaries) revenues of Rs 529 crs……that’s way too much….raises question marks on credibility of the Sales and Profitability figures and therefore Liquidity situation at the Company

Shareholding Structure reveals near 37% is held by Promoters and nearly as much by FIIs…Normally this should spell ‘confidence’…but seems more like just ‘con’

This Bengaluru proprietary software products based company will celebrate 25 years next year after it was co founded by Mukarram Jan and Asif Khader….Hope it does not go the way of Aftek Infosys (Rs 17) and Silverline (Rs 6)

There is heightened activity at the counter with traded volumes running into several lakhs of shares, both, at BSE and NSE read more