Five Star Hotel+85000ton Paper: Mktcap 52cr

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_ . Due to One Time Gain of 129.50cr, MVL showed profit

            Q1FY18.  Q1FY17
Income    65.       60

NP.           0.24.   -(11.42)

MVL has reported better nos for Q1 with *NP of 24 Lacs Vs LOSS of 11.42cr YoY*

MAJOR DEVELOPMENT: Major portion of MVL is under restructuring wherein ARC is acquiring debt of MVL (likely haircut 50%) and payment of same by MVL can be spread over 8 years *interest free*. It will lead to substantial write back which will make MVL Networth+

Reduction of debt will lead to better Operating margins in current year

Although we are not able to estimate financial for FY18 ( MVL will report profit, no 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 52 CR IS
PEANUTS

Stock can be 30 in 1 year. If MVL can continue improving its financials,  stock can be REAL MULTIBAGGER in 2-3 years

Compared to recent high of Rs 24, stock is attractive buy at CMP

Buying  recommended