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FINANCIAL CHRONICLE™ » EXPERT CHRONICLE™ » Odel! Where are you going?

Odel! Where are you going?

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Leon

avatar
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
Hi Guys....
Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50. But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

Share this post on: redditgoogle

mark

Post Thu Oct 27, 2011 11:12 pm by mark

@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

*At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x

*FY 12E EPS Rs.-1.81

if you think ODEL is undervalued and it deserves a higher price,then you can consider the buying,its up to you...
btw as to my view-this is overvalued

note-you can have some trading opportunities in this counter due to upcoming season,but do we have to offer such a high PE to this Rolling Eyes

note 2-this may be good for looooong term investors to hold in PF

Kumar

Post Fri Oct 28, 2011 1:55 am by Kumar

@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

Yes I agree with you, this share was recommended by some members in this forum, I think 4 weeks back.
You need to under stand the basic values of the share, before buying.
Sorry to say the recommended post was transferred to the expert section.
Joke of the year.
Some other guys also promoting some useless shares in this forum.
Be vigilant.

thambi

Post Fri Oct 28, 2011 5:42 am by thambi

yea i remember lot of people were FOR this share few weeks ago however do your research before investing please as mark has highlighted this share is a bit overvalued however it does have good growth potential in the future with good leadership and an intent to expand plus a strong brand name (goodwill) in the country however there are other profitable shares to look into at the moment BUT odel will be a good long term investment if u have the patience that is

avatar

Post Fri Oct 28, 2011 7:32 am by OneRupee

ODEL, BFL, GRAN, TAFL are all seasonal shares. These shares move during the season, and fall back afterwords.

That has been the trend in the past. Whether it's Christmas, April Holidays, Ramazan.

One has to take some risks in investing @ CSE. P/E and valuations does not work all the time, because we don't have a rational investor community who would invest based on share values.

Therefore I think since you have already collected ODEL, don't dump your shares at a loss. Chances are that ODEL, GRAN and BFL would move up during December.

It was the same situation last year. ODEL was trading @ 32 levels and it went up to 50 during christmas.

The only worry is with a depressed market, we really can't predict anything. Hope things would ease our by December.

CHASE

Post Fri Oct 28, 2011 7:48 am by CHASE

Dear Leon when you bought these shares? Hope in Sep.

We cant except a return over night. If so, stock mkt is not the place for you.

If I remember correct the heading was “keep an eye Open on ODEL” nobody ask you to jump & buy.

Any stupid can write anything in the forum, but it’s your
money do your own study before buying. & take your own risk. don’t point
fingers to others if something goes wrong. Even experts can’t predict the
current mkt behavior.

I agree with MARK it’s little bit overvalued. Fundamental along
doesn’t work in CSE

When fundamentally strong share goes down by 20% some crap will appreciate 400%

There are so many other factors to consider.

Personally I’m expecting this share to pass 40 by Dec/Jan. ( If any case if odel trading around 25 that period Please don’t say CHASE said this will pass 40 )

My advice is don’t panic & sell. I expect you can at least cover
your cost by Dec/Jan

good luck & please take your own decision

avatar

Post Fri Oct 28, 2011 7:52 am by ABEST

now it is very attractive price
not recommended to buy sell or hold

Think9

Post Fri Oct 28, 2011 8:32 am by Think9


who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

Dear Mark ! no offence but you should read more !! In the business world where all da strategies change time to time , we all should read articles and should be updated. PE is no longer a valuable value in the modern investment strategies. and PE doesn't give any indication whether the share s good or not. This ratio started to use in 90s effectively but IBM proved in 2003 that this is a fail way of measuring whether the shares s over/under valued.

anyway if u google, u will managed to gain more information..



Yes I agree with you, this share was recommended by some members in this forum, I think 4 weeks back.
You need to under stand the basic values of the share, before buying.
Sorry to say the recommended post was transferred to the expert section.
Joke of the year.
Some other guys also promoting some useless shares in this forum.
Be vigilant.


y dont u teach us the negative values of ODEL.N ?? LOL..

Here re the positive values of ODEL :

1.
ODEL reported moderate earnings growth for 1HFY12, +21% YoY to Rs. 122.2m,supported by 1) steady top line growth (+13% YoY) boosted by increased sales volumes across all brands; and 2) a significant reduction in income tax expenses (-51% YoY), following a decrease in the corporate tax rate from 35% to 28% coupled with a reversal in deferred tax provision. Net margins remained flat at 7%.

2.
Group turnover reached Rs. 1.7bn in 1HFY12, +13% YoY, driven primarily by increased sales volumes as a result of stable growth in same store sales coupled with contribution from newly opened stores in Kandy and Wattala. Gross margins remained broadly stable during the quarter at 39% (vs. 38% in 1HFY11), while operating margins dipped slightly to 11% (vs. 13% in 1HFY11) due to an increase in both administrative and distribution expenses, +30% YoY and 19% YoY respectively. Management attributes the increase in operating expenses to 1) higher promotional and advertising costs related to new store openings; 2) investment in knowledge capital (as part of the company’s strategy of benchmarking itself against international competition in terms of store layouts, service levels, ambience, etc); and 3) an increase in head count, in-line with the expansion in store count.

3.
Finance expenses rose sharply in 1HFY12, +53% YoY to Rs. 44.7m, as the company incurred additional bank borrowings in order to fund its store expansion.

4.
The company plans to further extend its retail reach over the medium term through a series of well-timed store openings in urban and semi urban cities in Colombo and outstation cities. It intends to open three new stores during the year, taking its total store count to 19 outlets by end Dec 2011. Despite its relatively aggressive capital expenditure plans, ODEL maintains a healthy balance sheet with Rs. 15m in cash and bank balances as at 1HFY12. Its gearing ratio was 74% as at end September 2011.

5.
ODEL’s 1HFY12 inventory turnover reduced to 1.7x (lower than the FY11 value of 2.5x) as the company has begun to hold inventory for its two new Kandy stores, which are scheduled to be opened later this year. Its receivables collection period amounted to 21 days in 1HFY12, while its payment period was 56 days, taking its cash operating cycle to ~183 days.

OUTLOOK :

Project Sri Lanka’s fashion retail market to record a strong growth trajectory over 2012-16E, driven by favourable operating conditions in the country. Domestic demand should see a sharp upturn, as rising disposable incomes and higher affluence levels

ODEL has, in our view, successfully established a unique brand identity in Sri Lanka’s highly fragmented fashion retail industry, and hence does not have any close competitors in the overall market in terms of scale, ambience, and quality/range of clothing offered. As such, we believe it should be a prime beneficiary of the projected industry growth

Given the company’s strong growth potential, we conservatively project FY12E full year earnings to reach Rs. 262m (+25% YoY), with a strong pickup in sales volumes during 3QFY12 which is typically the strongest quarter for the company. This translates to an FY12E EPS of Rs. 1.81.

At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x, at a 34% premium to the FY12E sector average of 13.3x. We believe a slight premium to the sector is warranted, given the company’s superior competitive positioning in Sri Lanka’s fast growing fashion retail market.

Source : ( JKSB report + Own )

please enlighten me with negative values.. so we can discuss directly rather than actin like kids and posting "wannaB" comments.



bliss

Post Fri Oct 28, 2011 8:33 am by bliss

Leon u hv 2 hold it ntil december...thr r positive chances 4 this share 2 move up...it happened in last december alzo..
Fundamentals dont work as it is in CSE...
Bt ODEL sales must hv been gone down as their prices r now very high n they hv a selected group of customers...they invested their IPO money on Battaramulla branch bt if u go there u cn see they dnt hv 2mch customers now even during weekends....instead go 2 NOLIMIT n check....
so if u r a long term investor itz jst nt enough waiting 4 company financial reports 2 come out...u must visit da plce u r interested of buyin shares...
Thats wat Warrent Buffet said in one of his books....

avatar

Post Fri Oct 28, 2011 8:47 am by Quibit

I personally consider Odel to be a good company. As we all know Sri Lanka will most likely be one of the top tourist destinations. Naturally shopping is a part of travel and tourism. Just think to yourself, how much money you spend on the air tickets, hotel/accommodation and shopping. Usually my shopping bill is higher than the first two. What you buy may be expensive or cheaper than your home country, but you continue to shop until you drop.

Government want to make Sri Lanka shopping destination that's why most of the duties relating to electronics goods have been slashed, that's why softlogic strategy of getting welknown brands like Giardano and other would be handy in the long run. This is why I think Singer Sri Lanka is better than Singer Industries.

Although Odel cannot be compared to some of the smallest shopping malls in the world but it has created goodwill among tourists, good value chain and reasonably good brand name.

Hawk Eye

Post Fri Oct 28, 2011 9:21 am by Hawk Eye

Are good shares need to have a low PE ratio.??

avatar

Post Fri Oct 28, 2011 9:41 am by Universalgoal

@mark wrote:
@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

*At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x

*FY 12E EPS Rs.-1.81

if you think ODEL is undervalued and it deserves a higher price,then you can consider the buying,its up to you...
btw as to my view-this is overvalued

note-you can have some trading opportunities in this counter due to upcoming season,but do we have to offer such a high PE to this Rolling Eyes

note 2-this may be good for looooong term investors to hold in PF

I Agree with Mark these shares are seasonal will run near December and comeback to near previos Odel bussines is good but competition also high exit at the correct time

avatar

Post Fri Oct 28, 2011 12:18 pm by arrowms

@Leon wrote:Hi Guys....
Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
@Leon
This is not the way to buy shares. 'cos its ur money.
I like to propose following steps, but there may be better methods than this.
1.Download Financial Reports , Study { CSE.lk }
2.Visit bloomberg.com ,
-Analyse { http://www.bloomberg.com/apps/quote?ticker=ODEL:SL }
3.Visit DU Invest ,
-Analyse { http://lk.duinvest.com/portal/LKCSE/stockOverview.html?goToHomePageParam=true&stockId=5866 }

Take time think and then invest
Happy Trading Very Happy

Dr.Bubble

Post Fri Oct 28, 2011 1:29 pm by Dr.Bubble

@Universalgoal wrote:
@mark wrote:
@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

*At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x

*FY 12E EPS Rs.-1.81

if you think ODEL is undervalued and it deserves a higher price,then you can consider the buying,its up to you...
btw as to my view-this is overvalued

note-you can have some trading opportunities in this counter due to upcoming season,but do we have to offer such a high PE to this Rolling Eyes

note 2-this may be good for looooong term investors to hold in PF

I Agree with Mark these shares are seasonal will run near December and comeback to near previos Odel bussines is good but competition also high exit at the correct time

me too agree with mark,no doubt that ODEL will be a good investment in long term,but considering current mkt,this is bit overvalued to me in PE side,but there can be a run in December if mkt do well...
did anyone recommend ODEL,i ddnt see any post of recommendation.,we all know that this CSE dont react to profits,this is just a mkt with high manipulation and speculation which i love the most.

Kumar

Post Fri Oct 28, 2011 1:43 pm by Kumar

@Dr.Bubble wrote:
@Universalgoal wrote:
@mark wrote:
@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

*At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x

*FY 12E EPS Rs.-1.81

if you think ODEL is undervalued and it deserves a higher price,then you can consider the buying,its up to you...
btw as to my view-this is overvalued

note-you can have some trading opportunities in this counter due to upcoming season,but do we have to offer such a high PE to this Rolling Eyes

note 2-this may be good for looooong term investors to hold in PF

I Agree with Mark these shares are seasonal will run near December and comeback to near previos Odel bussines is good but competition also high exit at the correct time

me too agree with mark,no doubt that ODEL will be a good investment in long term,but considering current mkt,this is bit overvalued to me in PE side,but there can be a run in December if mkt do well...
did anyone recommend ODEL,i ddnt see any post of recommendation.,we all know that this CSE dont react to profits,this is just a mkt with high manipulation and speculation which i love the most.

http://forum.srilankaequity.com/t10611-keep-your-eyes-on-odeln?highlight=odel

wappula

Post Fri Oct 28, 2011 5:19 pm by wappula

@mark wrote:
@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

*At a price of Rs. 32.10, ODEL is trading at a FY12E P/E multiple of 17.8x

*FY 12E EPS Rs.-1.81

if you think ODEL is undervalued and it deserves a higher price,then you can consider the buying,its up to you...
btw as to my view-this is overvalued

note-you can have some trading opportunities in this counter due to upcomingseason,but do we have to offer such a high PE to this Rolling Eyes


මොකද? මාක් මහත්තය ඔය ටික කලින් නොකීවේ

note 2-this may be good for looooong term investors to hold in PF

mark

Post Sun Oct 30, 2011 10:06 pm by mark

@Think9 wrote:
who recommend you to buy ODEL?
its trading around 17 or 18 forward PE ratio

Dear Mark ! no offence but you should read more !! In the business world where all da strategies change time to time , we all should read articles and should be updated. PE is no longer a valuable value in the modern investment strategies. and PE doesn't give any indication whether the share s good or not. This ratio started to use in 90s effectively but IBM proved in 2003 that this is a fail way of measuring whether the shares s over/under valued.

anyway if u google, u will managed to gain more information..


oh im sorry,i only know about PE Embarassed Smile


"............SHOE SHINE BOYS(many so called investment advisers and analysts seems to have started their career as janitors or tea boys at brokerage firms,and there seems to be a surplus of real shoe shine boys amongst the forum membership) are giving incredibly bad advise ,specially they are saying "BLUE CHIPS AND MANY OTHER COUNTERS ARE AT VERY ATTRACTIVE PRICES,52 WEEK LOWS AND IT'S TIME TO START COLLECTING" ridiculous........
...............A share at a 52 week low can go down to a 104 week low.........
The unpalatable truth is that DUMB MONEY STARTS BUYS ALL THE WAY DOWN TO BOTTOM..............the market turns when the dumb money sells out............
BROKERS WANT YOU TO BUY BECAUSE THEIR FAVORITE CLIENTS CAN TEN SELL.....''


By my friend TUBAL -JUNE 29th Very Happy

player

Post Sun Oct 30, 2011 10:50 pm by player

@Kumar wrote:
@Leon wrote:
Hi Guys....

Odel was a highly recommended share by our forum members. so, I got some odel @ 33.50.
But at the moment no any positive signal by this share. Is it better to keep it for some time or exit on a green day without much loss???
Your views highly appreciated..... Thanks

Yes I agree with you, this share was recommended by some members in this forum, I think 4 weeks back.
You need to under stand the basic values of the share, before buying.
Sorry to say the recommended post was transferred to the expert section.
Joke of the year.
Some other guys also promoting some useless shares in this forum.
Be vigilant.

Ya me too saw this thread in expert chamber sometime ago,it seems a moderator with common sense moved this back to the stock market talk,its funny we see such kind of behaviors in this forum...
its like suiciding when recommending shares in downtrend like this,when bull activates everyone is a great predictor,but you will find one or two ppl who can predict short runs in a bear market.

avatar

Post Sun Oct 30, 2011 11:01 pm by Quibit

I just moved the article to the Expert Chambers coz I think there is a good and professional discussion going on about this share. Expert chamber carries articles of good response and wider interest need not necessarily be a buy recommendation.

Please respect the the effort of the moderators.

Kumar

Post Mon Oct 31, 2011 12:09 am by Kumar

@Think9 wrote:

PE is no longer a valuable value in the modern investment strategies. and PE doesn't give any indication whether the share s good or not. This ratio started to use in 90s effectively but IBM proved in 2003 that this is a fail way of measuring whether the shares s over/under valued.

anyway if u google, u will managed to gain more information..




We all agree PE is not one and only one instrument to determine the stock value.
Please see the following
No of Shares 144.95 million
NAV=11.79
Cash Balance -339.95 million
Dividend Paid last FY - 0.50
Forwarded PER around 18.98 ( as at 28/10/2011 share price 32.00)
ROE (Forcast) - around 18%

Now decide at this price this stock is under valued/ over valued?
For me this is still over value.

avatar

Post Mon Oct 31, 2011 12:50 am by tj

At Profit before tax level when you compare half yearly results current year is negative 7% compared to last year. Also their increase in cash and cash equivalent is also negative 158Mn. Top line growth is 14% but if you allow for inflation i don't think there is much of a real growth here as well. I think with their expansions one would have expected a higher increase in the top line. Even if we forget about the PE ratio other than the fact that the company is in a growth sector i also cant see a compelling reason for this share to be attractive. However as CSE had number of unexplainable rallies this could also go up.

Thx
tj

Hawk Eye

Post Mon Oct 31, 2011 8:20 am by Hawk Eye

With a massive negative cash balance,and increasing finance costs, how prudent is it for ODEL to keep on opening few more stores??

avatar

Post Sun Nov 06, 2011 1:24 pm by swan03

My adviser told me that this share just like "Pathola". Hondakuth na narakakuth na.

mark

Post Tue Nov 15, 2011 11:05 am by mark

Laughing Laughing Laughing

Kithsiri

Post Tue Nov 15, 2011 11:32 am by Kithsiri

@swan03 wrote:My adviser told me that this share just like "Pathola". Hondakuth na narakakuth na.
Tell us the name and I want to ask him (she) how he (she) rates MASK today? Very Happy

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