Ambica Agarbathies and Aroma Ltd is actually a conglomerate of 7 different businesses namely:
- Agarbathi Division : Ambica is pioneer in Agarbathi business with experience of more than 55 years.It has various branded agarbathies for the local and export markets.In India it has more than 300 distributors/ dealer network in AP/TN/MP/Maharashtra/Gujarat state
- Ambica Empire Division see here: It has a 4 Star Hotel with more than 100 rooms at Chennai.Hotel is affiliated to Best Western Inc. USA. At today’s cost Hotel is worth more than Rs. 60 crores.
- Ambica Real Estate :It has developed land at Bangalore and realty project costing Rs. 30 crores with 600 members is nearing completion.
- Ambica Film Production and Distribution:Under this division there are multiplexes air-conditioned theatres and it has already produced 3 feature films valued at Rs. 15 crores and multiplexes at today’s cost could be worth Rs. 10 crores.
- Ambica Wind Power : Under this division Company is setting up 50 MW Wind Power project costing Rs. 200 crores at Poolavady near Coimbtore TN
- Food Plaza at Vishakhapatnam Railway Station:
- Software Division
Company’s Equity Capital is Rs. 13.5 crores and its market capitalisation at CMP of Rs.15 is just about Rs. 20 crores.
Except for Ambica Agarbathies and Ambica Wind Power Divisions, all other enterprises are debt free. Adding the individual enterprise values of various businesses like Ambica Empire Division,Ambica Real Estate,Ambica Film Production and Multiplexes, Food Plaza and Software Division the total enterprise value should be close to Rs. 120 crores vs. its present market capitalisation of only Rs. 20 crores.
Management is contemplating to restucture the various businesses, and most likely the Hotel, Real Estate and Multiplexes divisions will become a separate company. Similarly Power Division will also be a separate company. In the restructured company the present shareholders will get shares of the Ambica Hotel and Ambica Power FREE.
Presently the share is available at P/E of about 10.( see the financials below) However after demerger the the sum of the parts is going to be much bigger than the present CMP of Rs. 15, probably close to Rs. 75
|Scrip Code : 532335 Company Name : Ambica Agarbathies & Aroma Industries Ltd|
Financial reproduced from BSEINDIA
Buy at CMP of rs. 15 is recommended with 2 year HOLD to see aprice close to Rs. 100 of the 3 companies after listing.
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