Friday, January 29, 2010

GVK Power and infrastructure Ltd.


Please post your views about buy on GVK Power . Is it right time to invest in this stock.
SP Sharma, Jaipur-ask by shri S P Sharma jaipur by mail


GENERAL FEATURE AND HISTORY OF THE COMPANEY: -
1-
this company is in Power - Generation/Distribution and infrastructure business that is a good sign because power and infrastructure business is most attractive sector in developing countries like India it is a region that FII hold present stake in this company
2- if you want to visit company website then go to www.gvk.com


3-The Company was incorporated on December 2, 1994 as Jegurupadu Operating & Maintenance Company, a private company with unlimited liability,
Subsequently, this Company was converted from a private limited company to a public limited company on May 19, 2005 and the name was changed to Jegurupadu Operating & Maintenance Company Limited. Thereafter, the name of the Company was changed to GVK Power & Infrastructure Limited on July 13, 2005.
4-GPL was originally incorporated by Satyam Constructions Private Limited (name subsequently changed to Maytas Infra Private Limited) in 1996. Subsequently, IJM Corporation Berhard (Malayasia) joined as strategic equity partner. In 2000 NCC Power Corporation Limited, another IPP based in Andhra Pradesh, merged with Gautami Power Private Limited through a Scheme of Amalgamation. Because of the merger, the shareholders of GPL were Maytas Infra Private Limited along with their affiliates, IJM Corporation Berhard (Malayasia) through its subsidiary and NCC Power Corporation Limited. In July 2003, the Promoters through GVK Energy Holdings Private Limited (originally GVK Power Private Limited) took over the Company as a strategic equity partner and assumed the responsibility of implementing the power project and also contributed to the equity of the project, and executed an agreement in July 2003. Currently, equity contribution to the extent of 38.38% to the paid up equity of GPL has been made by GVKPIL, which is proposed to be increased to 51% through the infusion of part of the IPO proceeds. The other equity share holdings of Maytas, IJM and NCC are 17.71%, 25.09% and 18.82%,
Caution: - company history is related to satyam or maytas infra and before this IPO company has only 35000 share of 10 face value and company give 790 rupees per share dividend in year 2004 before IPO we think all the cash is distributed before IPO

CAPITAL STRACTURE OF COMPANEY:· In year 2004 company has only 35000 share of 10 rupees face value that is increase in year 2007 and total number of share is now 1405848900 of 1 rupees face value increasing of share is not good for investors because there profit is dilute for example if you are 2 member in home and your income is 5000 then you spend on per member 2500 but if member of family is increase and now they go to 10 member then only 500 is spend on per member
EARNING PER SHARE PROFIT LOAN ETC.:-
year 2008-09 EPS of this share is 0.15 paise only means one share of company is earn 0.15 rupees · . However, book value of share is 12.22 per share and a no debt on per share a cash surplus is 11.22 per share(but company history with satyam or maytas infra a question mark on book value or free reserves. Please remember the face value of unite share is rs. 1 only) so current market value 45 is very over price for this share·

PRICE DATA OF GVK POWER SHARE SINCE 2006: -· 1-In 2006 GVK POWERR make a year high of 400 and low is 130.55 but this price is not comparable with current price because this price is before spilt adjustment so if we adjust the spilt the price of current 1 rupees face value share in 2006 is high 67.34 rupees and low is 21.97 rupees·

2-in 2007 after adjustment year high 257 and low 46.63·

3-in 2008 year high 874 and low 10.30

PROMOTAR HOLDING: - promoters holding is more then 60 percent AND FII holding 23 percent is a good factor because if in a company promoters hold more then 50 percent is a good sign for company.

OUR ADVICE (FOR EDUCATIONAL PURPOSE READ DISCLAIMER); - we advice our reader that theycan not invest in this company. If they already invested and make profit then book part profit and if they making loss then hold and wait next bull cycle. However, take a cautious view on company corporate governance.
key words :- buy sell hold gvk power infra recomandations intra day call free

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