MALCO - Multi bagger

Madras aluminium- MALCO
BSE 504850
CMP Rs 800

Did you notice Malco shooting up 20% to Rs 780?

So you know why?

Malco has 1.1 share of Sterlite for every share of Malco

No of shares of Malco: 22,500,000

Malco owns 25,613,400 shares of Sterlite so if you buy 1 share of Malco you get 1.4 share of Sterlite!!!!

Sterlite is valued at Rs 930 and Malco is valued at Rs 780!!!!

Even if you assume Malco has zero value, then value of Sterlite holing in Malco is Rs 1060

So Malco should be up at least 36% more or Rs 1060 !!!

But note that Malco is profitable with quarterly EPS of Rs 16.28 or annual Rs 65!! so even if we apply conservative PE multiple of 10 that means its Rs. 650

So value of of stock of stock shoule be AT LEAST 650+ 1060 = 1701 or upside of Rs 930

So it shoudl be a muti bagger !!!