Equity Watch

MM Rubber – a potential MRF in the making

MM Rubber , with  mm FOAM brand is in the business of making quality mattresses, pillows and cushions.Its a part of the large business conglomerate(  MRF Ltd. ) with state-of -the- art manufacturing and R & D facilities located in South India.The Latex Foam Rubber division started in 1958, and today MM Rubber has Pan India presence with 350 dealers, 12 marketing offices and 5 decades of experience . MM Foam is the undisputed brand leader in latex foam segment.. 

A turn around driven by booming demand and co’s established goodwill in the market is expected in the next few years.Operating profit margins are showing a quantum jump during the last 2 Q’s..Net profit for the half year ended Q2 of FY10 is almost equal to the total profit for the last full year FY09. 

Scrip Code : 509196      Company : M.M.RUBBER COMPANY LTD.
Type Un-Audited Un-Audited Un-Audited Un-Audited Un-Audited Un-Audited
Period Ending 30-Sep-09 30-Jun-09 31-Mar-09 31-Dec-08 30-Sep-08 31-Mar-09
No. of Months 3 3 3 3 3 12
Description Amount(Rs. million)
Net Sales / Interest Earned / Operating Income 38.78 32.42 32.46 33.30 36.03 133.67
Other Income 0.01 0.42 0.53 -0.02 0.07 0.59
Total Income 38.79 32.84 32.99 33.28 36.10 134.26
Expenditure -34.76 -28.86 -32.06 -29.80 -35.03 -124.64
Interest -0.14 -0.11 -0.14 -0.46 -0.15 -0.91
Profit Before Depreciation and Tax 3.89 3.87 0.79 3.02 0.92 8.71
Depreciation -0.30 -0.30 -0.25 -0.30 -0.25 -1.10
Profit before Tax 3.59 3.58 0.54 2.72 0.66 7.60
Net Profit 3.59 3.58 0.54 2.72 0.66 7.60
Equity Capital 9.96 9.96 9.96 9.96 9.96 9.96
Operating Profit Margin 10.39 12.28 2.87 10.45 2.97 7.20
Net Profit Margin 9.26 11.04 1.66 8.17 1.83 5.69
Cash EPS

 Financials from bseindia

Co. is expected to report an EPS of Rs. 4 ( FV = Rs. 2 ) for FY10.Share of this company is available at P/E of just about 3 and is going very cheap indeed..Buy at CMP  is recommended for long term hold .With low equity of less than Rs. 1 crore ( 4.9 million shares of FV Rs. 2 ) upside potential is huge..

This report has been prepared solely for information purposes and the information contained herein may not be deemed to be an investment advice. Such information is impersonal and not tailored to the investment needs of any specific person. The information contained herein is not a complete analysis of every material fact representing any company, industry or security. The views expressed may change. While the information contained herein has been obtained from sources believed to be reliable, no responsibility (or liability) is accepted for the accuracy of its contents. Investors are advised to satisfy themselves before making any investments and should consult with and rely upon their own advisors whether and how to use such information in making any investment decision. Neither the author nor his firm accepts any liability arising out of use of the above information

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5 thoughts on “MM Rubber – a potential MRF in the making

  1. Deepak says:

    Dear Sir,

    Please check the publish holding of this company. That is almost 90%.

    So you think that this share will zoom with this much of public holding???? I dont think so….

    Regards,
    Deepak

    Like

  2. Deepak,

    Mgt. is doing all the right things, by writing of losses and cleaning the balance sheet.Scrip has come out of Z category and is now in T category. Its a matter of time that it will be in B category. This 50 years young Co. belongs to a very trustworthy Group of MRF where promoters have only 26 % holding and the share price has gone up 10 times during the last 6 years and is Rs. 6000 now..Its important for the mgt. to increase their stake in the co., otherwise it becomes a very tempting take-over target.Either way shareholder is the WINNER.!!

    AShok

    Like

  3. Deepak says:

    Dear Ashok Sir,

    I am really thankful to you… yesterday i bought 2k shares of MM Rubber for long term(5 years)…

    I need your help.. i have also bought 500 shares of GG Dandekar(BSE Code: 505250) because i got some news from an insider about this.

    I request you to please do some research on this stock and let me know.. also pls try to find out near term target for this stock…plsss

    Regards,
    Deepak

    Like

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