pricol.....contra script

I examined the nine-month financial statement of Pricol Ltd.
In summary
a) The sales have increased marginally (7.4%) over the nine-month period in the last FY (2004)
b) Correspondingly, the PBT have fallen significantly (from 43.9 crs to 28.6 crs; a drop of 34.8%)c) Notice the rise in interest cost. The nine month interest cost is at 8.43 crs while the financing cost was 4.87 crs in the previous FY. (a 73% rise)
d) Net profit after tax, dep and interest (PAT) is at 22.9 crs while it was 28.09 crs for FY2004-05.

The balance sheet reads ...Share Capital - 9.00 crsLoans - 155.90 crsInvestments - 14.75 crsNet CA - 86.13 crsFV - 1.00 rupees per shareDividend per share - 1.00 rupeeCMP - 39.75 rupees/share (15-Mar)Thus, the NCAV (as per 2004-05 balance sheet would come to negative 7.75).

Estimating trends in FY2005-06, I find ...1. The profits for the year should be around 29 crs. This would mean a P/E of 12.08 on todays CMP.
2. There is no margin of safety here. The NCAV is infact, negative.
3. The company would be in a position to give a dividend of 75 paise only this yr due to the lower earnings. This comes to a 1.89% dividend yield.
4. There is no news of value on the stock too - although it has decent volumes on the bourses.

My take - this stock will not move much from this level for the next few weeks. Further improvements in the stock price will be a function of news or increase profitability. There is no hidden value in the stock that is visible.

i will start accumulating below 33-35 levels since its a value play...many mutual funds hold this script in their portfolio........a contra script