How share pricing Works?

#1
I was looking at a share (Surat Textile mills) and the share price is around 1.30 rs and has very low float, that is it has just 22 crore share outstanding. This company has zero debt and eps of around .50 paise per year and even if we leave these things aside, this company has over 55 crores as cash reserves basically invested in Mutual funds and stuff so shouldn't the share price be at least more like 2.50 or something accounting just for the cash reserves alone? Am i missing something or is this something to do with the sector as it's a textile company? How fundamental analysis works truly baffles me?

On one hand I think I am truly missing an opportunity on a good stock as it has potential to at least go to 3-4, on the other I am frightened what if this pricing anomaly doesn't change over time and the stock doesnt' give any meaningful return in the future and my investment is a dud...
 
Last edited:

Similar threads

Zerodha – Open Paperless Account

Open online account with Zerodha. Free delivery trading and Max Rs 20 for Intraday, F&O, Currency and Commodity Trading. Intraday High leverage with MIS, CO and BO.

Name:Phone:
Email:City:
State:
Are you a day trader?