Tulsian is positive on Coal India as the penalty, in his opinion will not be too severe and that the company will be able to easily meet the current requirement of coal.
Below is an edited transcript of the analysis on CNBC-TV18.
Q: What is your initial analysis of Balrampur Chini 's results?
A: The results are strange and disappointing. In the March quarter, the company had a turnover from sugar was Rs 520 crore with an EBIT of Rs 80 crore.
For this quarter, the turnover is close to Rs 580 crore with a negative EBIT of Rs 23 crore, resulting in the positive 16% EBIT turning into an negative EBIT of 4%, which is really very strange as Balrampur Chini carries an inventory of Rs 2,000 crore as on March 31.
There is a disparity between the price prevailing in Uttar Pradesh and southern India during the June quarter and for the first time, sugar from southern India has been fetching higher realisation by about Rs 1 per kg.
But it is very strange to take a call that the realisation of the sugar in the June quarter was lower than what the company realised in March because if you value stock at cost or market price, whichever is lower as on March 31, the company is carrying an inventory worth Rs 2,000 crore, obviously a lot was expected from the sugar segment, it is very strange.
There is a total shift of more than Rs 100 crore - from the Rs 80-crore positive EBIT, to about Rs 23 crore in negative EBIT. Though, there have been seeing estimates of a PAT of Rs 20 crore posted by Balrampur Chini given by various broking houses, I expected that to happen anywhere between Rs 45-50 crore.
Comparing the realisation with Triveni Engineering is futile. If you take an average realisation even at about Rs 29 - 31 for the quarter, though it is very difficult to take a call, and even if they have sold about 20 lakh bags of sugar in that quarter, it is very disappointing.
The only saving grace is the inventory worth Rs 1500 crore after having sold sugar worth Rs 500 crore in the June quarter. I hope that the company has a better realisation of Rs 33-34 in this quarter and I expect the profitability for the September quarter to be quite good, But its a big disappointment and surprise from the sugar segment.
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