Fri, 29th April 2016

Anirudh Sethi Report


Archives of “debt equity ratio” Tag

Who will collapse first-Banks or Corporates?

Banks, Real Estate, Infra, Under Threat Of Collapse
As stock prices sink, major projects get stalled and RBI manadated interest rates hike in an environment of a falling Rupee, all GOI efforts to protect the Rupee and increase exports will fail. Moreover, rising oil price and falling rupee will keep raising CAD in a environment where double digit plus inflation will become the new normal. So the moot question is will all these PSU banks below Rs 100 fail first and get merged with bigger banks or will the corporates themselves fail leading to a collapse of the Government at the centre and an ultimate sovereign default?

Banks most exposed to highly leveraged companies We identified 66 highly leveraged listed companies with Net Debt/Equity ratio >1.5x and Net Debt > Rs10bn. These companies had a combined net debt of Rs 4,969bn (US$81bn) or nearly 9% of banking system loans and 15% of banking system loans to Industry & Services sector as on end FY13. Many of these companies may have problems in servicing their debt and are therefore vulnerable to being classified as NPL or restructured category. However, only a few have so far been classified as NPL or restructured. Read More 

AK Capital-Debt Syndicater Worth A Look Over ,Technically RIPE for BIGBLAST !

AK Capital [BSE 530499]-One Of The Biggest Players In The Debt Market, Worth A Re-look

At this price trading at TTM PE of 3 and forward PE of 1.5.
60% Promoters shareholding.
Corporate Bond market expanding in India at a great pace.
Interest rates will start to come down which is very beneficial.
Net profit margin one of the hightest 30% and ROE also 30%.
Debt Equity ratio of just 0.25 … so very less debt.
Dividend of Rs 6 means Div yield of 4%, quite good.
FORBES include it in Asia’s 200 fastest growing companies.
Promtoers bough 6 lacs or 10% of total capital from March to May 2009


Technically ,We see Stock zooming to kiss 188—–215——–225 level very soon.

Catch it and Forget.

Buy small qty…………….Dont Try to become Crorepati in Single Day.


IOC says finances so bad, it may have to shut units,Chart indicates immediate tgt of 273-250

Despite raising the price of petrol 13 times in the past one year, the financial situation of Indian Oil Corporation (IOC), the country’s largest oil marketing company, is so bad it may have to shut down some of refineries with no money to import crude.

“Our debt-equity ratio is 1.66. We have a debt of Rs73,000 crore in our books. If the situation does not improve, we may not be left with money to import crude from the international market and we will have to shut some of our refineries,” said RS Butola, chairman and managing director, Indian Oil.

The company on Wednesday announced its worst quarterly result with a net loss of Rs7,485.55 crore for the quarter ended September 30 due to mounting losses on fuel sales.

The loss for the second quarter is in sharp contrast to a profit of Rs5,294 crore notched up in the same quarter of the previous year.

“The loss is mainly on account of an increase in unmet under-recoveries and increase in interest expenditure,” said IOC in a statement.

The public sector undertaking has not been given any compensation in the current fiscal by the finance ministry for the huge under-recoveries that it suffers by selling fuel at loss.

“The finance ministry needs to pay us Rs23,000 crore as compensation for the first two quarters, but we have not heard anything from them till now,” said Butola.

IOC had capital expenditure plans of Rs14,800 crore for the fiscal. “We will review this by end-December or by the first week of January, and if our borrowing continues to remain high, we will cut the capex plan,” said P K Goyal, director, finance, Indian Oil.

We are Highly Bearish on Refinery Stocks from last 15-20 days !!

Our Ultimate Target for IOC is Rs.181

Traders will  273—249 level very soon !!

Will Update more to our Subscribers.

Updated at 20:25/10th Nov/Baroda

Oil PSUs debt shoots up to Rs 130000cr

Petroleum minister Jaipal Reddy has demanded from the finance ministry an early compensation for PSU oil retailers who are selling fuel below costs and whose borrowings till September have touched a staggering Rs 130,000 crore because of under-recoveries.

A senior oil ministry official said Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd were facing a crisis situation.

“They have an unprecedented level of borrowings of Rs 129,989 crore to meet the working capital and dollar requirements to pay for crude import,” the official said.

The country imports 80 per cent of its crude requirements.

The three firms had a combined borrowing of Rs 96,727 crore in the last fiscal. Read More 

Indian Oil stake in nuke power project

State owned Indian Oil Corporation (IOC) will invest around Rs 961 crore to pick up a 26 per cent stake in Nuclear Power Corporation’s 1,400-mega-watt (MW) project at Kota in Rajasthan.

“We will join Nuclear Power Corporation by picking up 26 per cent equity in their 1,400MW Kota atomic plant. The joint venture agreement will be signed in a month,” IOC chairman and managing director B. M. Bansal said.

The project, which will entail an investment of Rs 12,000 crore, will be funded through a debt-equity ratio of 70:30.

The facility will be completed by 2015-16.

Sources said IOC would initially pick up a 26 per cent stake but would have the option to increase it up to 49 per cent.

The cost of setting up a mega watt of nuclear power is Rs 8-10 crore. Read More