Sales have grown from around Rs.122 Cr to around Rs.669 Cr from 2003 to 2009. Profits have grown from around Rs.3 Cr to around Rs.20 Cr from 2003 to 2009.
Renaissance Jewellery Ltd. has been earning a return of at least 9% on its net worth per year from 2003 to 2009. It has earnings per share of around Rs.15 in the last 12 months.
Renaissance Jewellery Ltd has a cash and bank balance of around Rs.21 Cr. It has investments of around Rs.50 Cr. It has a Net Worth of around Rs.211 Cr. It has a market capitalization of around Rs.167 Cr which is less than its Net Worth!
At a market price of around Rs.87 and earnings+dividends of around Rs.16.5 the initial rate of return is around 18 percent! The value of the company according to me should be at least Rs.100-150.
Renaissance Jewellery Ltd. is a Jewellery company and has a Debt Equity Ratio of 0.64. Competitors are Rajesh Exports and Gitanjali Gems.
Renaissance Jewellery Ltd. has grown its cash from Rs.1.67 Cr to Rs.20.96 Cr. during the period 2003 to 2009. This translates into a compounding rate of greater than 75%!
Assuming that Renaissance Jewellery Ltd. continues to grow its cash at 40% and taking a discounting rate of 8% the cash flow would be something like below for the next few years.
27.17 + 35.22 + 45.66 + 59.18 + 76.72 = Rs. 243.95 Cr which is greater than current market cap of the company!
Renaissance Jewellery Ltd has Net Current Assets worth Rs.267 Cr which is greater than its current market cap!
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