Peter lynch would call this stock A screaming bargain. A stock having book value of Rs 85 and selling less than it . Add to it its eps is Rs 25 . bloody hell......
This means that if one were to sell of all its assets ...........at Rs 85 ( its book value ) the cost of the entire company would be Rs 18700 million . But the market was pricing it at Rs 77 ( 16940 million Rupees ) .Now that is a sweet price for a hostile take over .
KS oils is in a relatively simple business to understand, Thus conforming to buffets ideal of "Scope of competence " .
As per me the stock that comes nearest to KS oils valuation is Mtnl . which was also priced close to its book value. But the only issue with mtnl is its eps is a bit low.
But still a good price to enter the stock.
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u have got it completely wrong..the stock has been split 10:1 so the book value would be 8.5 and not 85..although i do agree with u that it is a great buy..not screaming though!
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