Tuesday, January 8, 2013

Adding JaiCorp in Model Portfolio

Now I am adding Jaicorp in my model portfolio with a weightage of 10% @ 85 rate 117 shares
for a value of Rs.9945 and reserve fund in portfolio is reduced to Rs.102134

Maharashtra cabinet cleared the new industrial policy, which allows special economic zone (SEZ) developers to utilize 40% of the land in their possession as an integrated industrial township project.

If you go by the business model of the company and if I take the networth of Rs 2,400-2,500 crore of the company, more than Rs 1,500-1,600 crore has been invested in the real estate. They have interest in Navi Mumbai SEZ, Maha Mumbai SEZ, Rewas port and many real estate companies. It is very difficult to ascertain what kind of interest or percentage of holdings they have. It is quite substantial.

The major chunk of both these SEZ’s ownership are with Mukesh Ambani in his personal capacity but some portion of them, the beneficial ownership or the ownership of these two SEZs are also held by this company. Now there are talks that some of the monetisations of the company’s interest in these SEZs as well as in the other real estate projects in which interest of Mukesh Ambani lies, will get monetized for which the company may get a huge amount - as against the marketcap of Rs 1,500 crore, people have been talking of Rs 2,000-2,500 crore.

Due to this newsflow and the huge real estate investments, company should be termed as a real estate company only. Three-four years back when they made a preferential allotment, then the frenzy for real estate stocks was there, the marketcap of the company moved more than Rs 20,000 crore, while now the marketcap is close to Rs 1,500 crore. It is a debt-free company with a networth of close to Rs 2,500 crore.



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