Modern Dairies is a good value stock

Dear Ramanathan,

What Suggestion U Gave About Stock It Really Helped Newcomer Like Me. But I Have Seen That In Forum We Dont Talk Much About Shares Like Which Shares In Market Which Is Good To Buy. No Offence To Anyone. But I Searched A Lot To See What Suggestion I Can Get From Senior Member .

Pls Give Ur Opinion About It

Regards
Moksh

Dear Moksh,

What you say is not fair. There are people in this forum running entire threads on stock recos. (Mahmeds, Supratik based on FA and Winstonn based on TA is what i can recall as of now - I'm sure there are others).

Moreover a forum is for discussions, not a tip giving service.
Mr Ramanathan's posts are not just about a stock but an illustration on how to use FA for stock picking. It is your loss if all you can derive from it is the name of a stock to buy and its tgt.

There are wonderful threads by Saint, Ashish which you can view as stock recos based on TA but would be a pitifully narrow view in my opinion.

On the other hand you can make use of the resources here to learn to do your own research, stock-picking instead of just relying on others. I don't think anybody has managed to survive in the mkts based on tips alone.

Regards,
Kalyan.

I agreen with Kalyan. There are plenty of resources out there. You just have to have some initiative to search them and find what you're looking for. I'm glad I could help with this particular discussion. But I myself would be interested to see other people's analysis and other's opinion on my analysis. Good luck with your investments!!!

dear kalyan,

i understood ur point of view..will take care of it and do my own research inspite or relying on anyone.

regards
moksh

Dear Ram,
I really apreciate the hardwork done by you in searching for good stocks and sharing the same with others.
I have some doubts about the performance of modern diaries,so i thought an opinion will be useful from you,
Why the company after making profits several times -do not want to share it with the ordinary shareholders (even though they are in small no's) in the form of divident so far?
Why the growth or performance of the company is not steady? is it common with the sector. if so can we project a stable high eps in the coming quarters?
Why the mutual funds have less interest in the stock ? they don't see it?
These are some doubts poped up while analysing the company details.Hope to hear your comments.
Pleeease take this for a healthy discussion or may be I am an inexperienced analyser asking such foolish questions.
Thank you

Hi Alleppian
Risk to Reward ratio looks good with Modern Dairies compared to other stocks. What you mention is a risk in any stock you invest in. Where ever you get more reward for less risk, you ought to take it.
Ram

Hi Ram,
Thanks for the reply !

Incorporated in 1992, the company is engaged in the business of dairy products,
ghee, butter and infant milk foods. Company markets its table butter under the
'COWBELL' brand and liquid milk under the 'SHWETA' brand. It has plant at Karnal
in Haryana. The company made its IPO in 1993. In 1997, the company was declared
sick and was referred to BIFR. However, by the year 2000 company's networth
became positive and in May 2000 BIFR asked IFCI, the operating agency to submit
a compliance report on Modern Dairies stating whether the company be discharged
from the board's purview.

Thanks Circle zee. Modern Dairies is in a good sector, since the year 2000 they have been doing well. P/E is so low, at 3.5. If you want the perfect stocks to own you'll have to pay P/E s like 25, 30, 35, 40 times. Once again, Risk/Reward looks attractive. But who ever reads my analysis please do you due diligence. I always welcome different thought and ideas which is what makes the discussion lively.

Ram

Interesting articles. Modern Dairies looks attractive after the market correction.


http://www.radionz.co.nz/news/latest...s_lift_returns

http://www.israel21c.org/bin/en.jsp?...&enZone=Health

http://canberra.yourguide.com.au/det...ry=environment

http://www.manilatimes.net/national/...70312bus1.html

Milk, dairy prices to surge on supply lack

By Katrina April Mennen A. Valdez, Researcher

PRICES of milk and other dairy products are expected to surge this year following its limited supply in the world market, a Nestlé Philippines Inc. top executive said.

Nandu Nandkishore, the company’s chief executive officer, said consumers should expect as much as a 50-percent increase in prices.

Nandkishore said scarce supply brought about by the drought in Australia and New Zealand would be responsible for the price spike. Australia and New Zealand are the major suppliers of milk.

The Nestlé executive said local consumers have begun enduring a 5-percent increase in prices since February. He said this monthly 5-percent hike would accumulate to 50 percent for the whole year.

The average inflation rate in February dipped to a four-year low of 2.64 percent for all items, while price increases for dairy products alone stood at a higher 4.24 percent, according to a recent report by the National Statistics Office. Higher inflation for dairy products, corn, eggs and cereal preparations bid up food price increases to 3.02 percent.

Despite rising prices, the recent strengthening of the peso against the dollar has eased somewhat the surge in milk product prices, Nandkishore said. Last year, world prices of milk reached $2,200 per ton.

Nestlé produces infant milk, which is formulated to supplement breast milk. These brands include NAN, PRENAN, Nestrogen AL 110 and ALFARE. Products for young children and adult include Nido, Bear Brand and Alpine.

Nandkishore said the company intends to increase its production capacity for milk products and growing-up milk.

Compared to other countries, the per-capita consumption for milk in the Philippines has been declining by almost 15 percent over the last five years, he said.

From 21 liters in 2005, the Philippines’ per-capita consumption for milk was down to 18 liters in 2006. Indonesia has a smaller consumption at 10 liters, while Thailand and Malaysia consume more.

India consumers 80 liters of milk per capita, while European countries use up 300 liters.

Nandkishore said a big part of the company’s investments at P1.3 billion will be allotted to promoting higher consumption of milk in the domestic market.