GUESS THE GEM 1 ANSWER - LAWRESHWAR POLYMERS LTD

1) Lawreshwar Polymers - A footwear company marketing its products in the brand name 'Lehar Footwear' it has won national awards in the year 2005 and 2006. It is traded on the BSE stock exchange, scrip code is 532829 and symbol is Lehar. The website address of the company is - leharfootwear.com

2) Lawreshwar Polymers is trading at 34.20 and its 52 week high is 39.50 which it touched recently and current price to earning for the stock is 25.42 against industry price to earning average of 35.27, Company is having a total debt of 20.87 crores and its debt to equity is better than that of Liberty Shoes. Market cap is at 51.09 crores and the largest peer is Bata which is having a market cap of 8100 crores and trading at a p/e of 46.49.

3) Lawreshwar has recently tied up with SNAPDEAL and ASK.com to sell its products online. It also has more e-commerce tie-ups in the pipeline. The company has never ever reported annual loss, promoters hold 65.65% stake in the company and the stake has increased sharply over the quarters and years. In December the shareholding pattern shows that fiis have taken a entry into the stock.

Basic Info

Lawreshwar Polymers Ltd

CMP - 34.20

MCAP - 51.09 CRORES

P/E - 25.42

FV - 10

MCAP/SALES - 0.66

DEBT/EQ - 0.64

INTEREST COVERAGE RATIO - 2.14

UPPER CIRCUIT FOR TOMORROW - 37.60

Financials

Financial Year 2013	Financial Year 2014	Financial Year 2015 Trailing
SALES - 68.46 CRORES	SALES - 77.05 CRORES	SALES - 77.94 CRORES
OPERATING PROFIT - 4.63 CRORES	OPERATING PROFIT - 5.49 CRORES	OPERATING PROFIT - 6.24 CRORES
OPERATING P. MARGIN - 6.76%	OPERATING P. MARGIN - 7.13%	OPERATING P. MARGIN - 8.06%
NET PROFIT - 1.37 CRORES	NET PROFIT - 1.70 CRORES	NET PROFIT - 2.01 CRORES
EPS - 1.00	EPS - 1.24	EPS - 1.47

Conclusion

1) Lawreshwar is available cheaply against its peers.

2) Company has tied up with snapdeal to scale up its business. It has not yet listed its entire product range on snapdeal and is making progress to tie up with other e-commerce platforms too. So, very soon Lehar footwear products can be on flipkart and amazon too! The e-commerce sector is attracting huge private equity investments and lot of stocks are buzzing due to the e-commerce boom and perfect example for the same is Intrasoft Technologies which is a e-commerce company now trading at a price to earning of over 60.

3)In the footwear sector lawreshwar is growing very fast and with online sales it can easily compete with the giants since the demand of apparels and footwear is at all time high on e-commerce websites. 

4)The fast growing company that Lawreshwar is also makes it a probable takeover target, I have read rumors on social media that suggest relaxo footwear and liberty shoes are looking to takeover lawreshwar polymers. However, there has not been any official word from any of the companies about the same and lawreshwar company secretary keeps saying that if there is any such news it will be reported to exchange when finalized and is declining to even deny the rumor. 

5)It is clear that lawreshwar is a multibagger candidate available at significant discount to other footwear companies with a great business scalability opportunity.

Disc : It is safe to assume that i have vested interest in this stock and hence my point of view can be biased.

Names of people who guessed it right

01- Deepak kumar prasad

02 - Vijay grower

03 - Nishit parikh

04 - Raman singh

05 - Romil mehta

06 - Vihan jain

07 - Goutham vaidya

08 - Nilesh jani

09 - Brajesh sharma

10 - Sambit

11 - Rahul gupta

12 - Jaychand

13 - Ravi vakayil

14 - Shiva

15 - Mayur gala

16 - Saravanan

17 - Aditya

18 - Dharmesh jhaveri

19 - Vivek

20 - Manoj agarwal

21 - Diptesh p

22 - Naskar das

23 - Ranjan

25 - Sk gupta

26 - Dhananjay

27 - Shiv kumar
28 - Mayank arya
29 - Ravichandran dhaya

Congratulations to all for your time and effort.

GUESS THE GEM - 1

It is the Series of 'GUESS THE GEM', this is the first one.Try to identify the stock from the given clues and send the answer to my mail id valuepick.mitul@gmail.com. Name of winners, name of stock and detailed summary will be posted on 5 march 2015 before market hours.

I would like to thank highly respected value-pick ji from value-picks.blogspot.in for introducing this idea of guess the stock to increase the analytical capability of the average indian investor.

- CLUES -

# The national award winning company is listed on one of the two stock exchanges bse/nse.

# Company's website is not on the company's name but on the brand's name.

# Company is trading at over 30% discounted price to earning vs industry average on screener.in

# In the 13-14 annual report balance sheet, company has long-term borrowings more than 2 crores.

# Stock price is trading very near 52 week high which it touched last month.

# Company's symbol on the exchange is it's brand name.

# Market cap of the company is under 300 crores.

# One of the peer large company's stock in this sector is trading above Rs 1000 per share.

# Company is looking to scale up its business with new tie-ups including a tie-up with a company which has attracted investment from a prominent industrialist of our country.

# The company has never ever reported annual loss right from financial year 2005.

# Financial year 2014 eps of the company was above Rs 1.

# Promoter holding is above 55%

# As per dec-2014 shareholding pattern the promoter stake has increased and there is fresh (fii/dii) stake addition.

I am expecting to continue this format of guess the gem for all next stocks but request readers not to leak answers on web portals otherwise it gets boring and also unfair to people who are searching for the stock to get their name published.

Do not expect confirmations whether the guess is right or wrong by e-mail or any other medium.