Five Star Hotel+85000ton Paper: Mktcap 30cr

MAGNUM VENTURES LTD

Delhi based MVL is in business of hospitality and paper mfg.

1) Hotel Division: Co owns and operates 5 star hotel *Country Inn*with 212 rooms which also has 4 restaurants and coffee shop. Located in Sahibabad , outskirts of Delhi

2) Paper Division: Spread over 10 acres, it has 85000 tonnes capacity

MVL doesn't have good track record. However co appears on cusp of turnaround. Stock price can go up multiple times, hence buy recommendation.

                              FY17

Sales.                   212

Depreciation.      23.87

Loss.                   -26.34

Exceptional.      129.50
Gain

Profit                  103

MVL made loss of 26.34 from its business operations. _Since co provided 23.87 cr for depreciation, Cash loss was 2.50cr_

Company sold surplus land which resulted in one time gain of 129.50 crores. Sum is being used for part payment of debt. Reduction of debt will lead to better Operating margins in current year

Although we are not able to estimate financial for FY18( whether profit or loss), still MVL appears risk free buy considering:

HOTEL ITSELF COULD BE WORTH MORE THAN 300 CRORES

PROSPECTS OF PAPER DIVISION MAKING PROFIT ARE QUITE BRIGHT

MKTCAP OF 32 CR IS
PEANUTS

Downside from current level can be very minimal.
Stock can be 30 in 1 year. If MVL can continue improving its financials,  stock can be much higher in 2-3 years

Buying strongly recommended