Poker Boom in India

This is most talked abt topic in Gambling world these days. Poker relatively newer to Indians but is being considered as Boom with more and more peoples rush Goa to play it live.

http://www.aintluck.com/india-online-poker/

http://www.aintluck.com/poker-boom-india/

http://forumserver.twoplustwo.com/29/news-views-gossip/poker-booming-india-1056478/

http://www.pokerstrategy.com/news/world-of-poker/The-Rise-of-Poker-in-India_51124/

Cravatex Q2 Results

Results were pretty encouraging. Their subsidiary BB(Uk) is definitely adding value for them as it can be seen in their current quarterly results.

Consolidated sales are up 136% from 23 Crores to 53 Crores

Subsidiary breaks even just in second quarter of operations, hires more QoQ

Consolidated net profits up 88% from 1.64 Crores to 3.08 Crores

Consolidated EPS for Q2 12 Rs

My estimates of Full Yr Net Profit is 11 cr. with EPS is around 43 , stock currently trading at 11 times which seems cheap. Could surprise !!!!

Some update

I am quite bullish on bond market of India. Its at very nacent stage ( corporate bond ). Due to massive double digit Inflation and steep rise in interest rates, bond yields have shot to 3 years high impacting fresh investments in them. Crisil India's leading rating agency also comments that the bond market could remain subdued for this whole year due to same reasons.

I guess this has given a great opportunity in investing in India's leading bond market placer A.K. Capital. For past 5 years it has been ranked No.1 bond placer by Prime Database. Its Sales have increased from 46 cr in 2007 to 153 cr in 2011. While net profit from 21 lakhs to 50 cr. for same period.

This is stunning performance but since last sep it has been struggling due to many factors

1. As mentioned earlier rise in inflation and interest rates have badly effected thier performance.

2. News of their involvement in housing loan scam together with LIC housing and Money Matters. Although management has clarified that they are not involved in such an act and there were no enquires or charges by CBI towards them.

3. Even Mr. White & White has sold out his stake completely ( or may be now he holds less than 1% which was around 2.5% previously).

As a result stock has tanked from 900 odd to 230 today. At 230 it has market cap of 140cr. This according to me is a classic case of Cash bargain as they have investments of 170Cr. and completely debt free as per their latest quarterly results.

Its quite clear that interest rates are not going to be as high as its now going forward. Its almost at its peak of its cycle and should start falling down with inflation from next year. As for their image getting tainted due to scam , I recently read an article where officials of ministry of Finance discussed with representatives of financial institutions like Morgan Stanley, ICICI Securities, PNB Gilts, Tata Group and AK Capital, on the steps for boosting corporate bond market. This gave me enough confidence that they are still the prefered one's.

Waiting for a New Casino in Daman

Gaming appetite in Indians is huge which can be seen in form of sports betting. Around 1000cr is betted in single Cricket world cup match. Even I for my self like to play cards in "Sawan month" . Its Diwali and Indians have started visiting Casinos in Dubai and Macau. Here is an article of the same

Cravatex Ltd. management talks...

Following is what Mr. Rohan Batra (Batra Group) replied to various questions asked by Mr. Arora.

Dear Mr Arora,

See my replies below (in red) to a few of your questions. Due to the sensitivity of information in a public company I would not be at liberty to discuss in specific the majority of your questions.

As to the business development of the product lines we will be adding them as and when we see an opportunity in the market however we are focusing on our core businesses for today.

We are aware of what the Fila brand is doing globally and will act upon opportunities when we can.

Both the fitness and sports markets are growing at a rapid pace and we hope to be a major player in them in the coming years.

I apologise for not answering your questions in depth and I hope you understand the reasons behind this.

Q 1. Plans for rollout of stores for Proline-Fitness and FILA over the next three years. Will they be self-owned or franchise owned?

A 1. We have plans to roll out a number of stores in the coming years and they will be a combination of both franchise and owned stores.

Q 2. How many of 51 Proline-Fitness stores are company owned and how many franchise owned in India. FILA in Korea has 400 franchise showrooms, can we not expand franchise showrooms of FILA in India so that others money is invested in shops ? FILA Korea is at #2 spot and ADIDAS is trailing them at #3 position for the past five years, something similar can happen in India with greater brand building focus, my next question follows from this.

A 2. The majority of our stores are operated by the company with the exception of a few. We are aware of the success of Fila in Korea and with obvious consideration to the local conditions of business try and adapt our model and succeed in India.

Q 5. Difference in positioning of a Proline fitness store compared to Fila store in terms of location( Tier 1,2, audience etc), store size , Budget allocation(Rentals ,working capital rqmts etc).

A 5. Both are similar however fitness stores are larger.

Q 11. Is it possible for Cravatex to get Titleist and Footjoy rights in India, after FILA Korea's Acushnet acquisition. Titleist has 69% market share and Footjoy has 57% market share in USA, they are worth every penny to fight for.

A 11. As of now this has not been discussed as the acquisition only happened a few months ago.

News Related To Delta Corp

Thunderbird Resort Daman in which Delta Corp owns 51% stake is scheduled to start this month. Delta Corp also has an In-principle license to setup land based Casino in Daman. There was a news report in Business-Standard last month on the current status on this.

Opening of this casino can prove to be a game changer for Delta corp. It will be first real live Casino which will be similar to that of those in Las-vegas , Singapore and Macau.

Cravatex Ltd.

Cravatex is basically a trading company currently trading at 450 with market cap of 125 crs.. It trades in two segments Sports and Fitness.

In fitness equipments it has rights to sell products of Johnson ( no.4 brand in world) , Horizon , BodySolid , Magnum under the brand name of Proline Fitness.

In sports segment it has rights to sell product of brand called FILA. Fila is a 100 yr old Italian brand which ranks 5th in world after Nike , Adidas , Reebok and Puma. Fila worldwide sells 15000cr. of merchandice yearly worldwide. In 2008 Batra brothers got right to sell FILA in India along with North Africa , Bangladesh , Srilanka.

In June 2011 results cravatex turnover was 42 cr (26cr domestic , 13 cr international) with Net Profit of 2.8. Since FILA brand has priced lower than top 4 brands, middle class people will get attracted to FILA. Assuming in next 5 years they manage to clock 500cr. of sales with Net Profit of 50 crs. we get an EPS of 385 ( 50/0.13 ) . Since its a pure consumption story market gives high PE to this sector . Assuming worst case PE of 10 while best case of 35 we can see this stock in range of 3850 - 13475.

Calculations are based on BOTE and has few risks attached to it. Do your own Diligence before buying.

Delta Corporation

Delta Corporation, the first, biggest and only listed Casino company in India is a promising Future Bluechip stock. Today it has market cap of 2200 cr. and trading at 113.

If one looks at Singapore with annual visitation of around 9 million annually 2 casinos have clocked around 28000 Crs. in just 2 years of starting its operation. While when we look at Macau China, in 5 years it has managed to clock wopping 1,00,000 crs. . Delta corp has an annual sales from Gaiming and Hospitality of 100crs v.s 11cr in 2009.

Logic is simple if Singapore with 9 cr. population and 9 million visitors can do such a big business, why cant India with 121cr population and 2 million visitors in Goa cant manage to do 10% of the business done in Singapore in next 5 years.

So assuming if Delta indeed does a turnover of 3000 crs. and Net Profit of 900cr annually, we get and EPS of around 45 ( 900/20 ) . Its a unique business and thus should command a high PE,

so let worst case PE be 15 while best case be 40, we can see this stock trading in between 675 - 1800 in next 5 years.

This is a simple BOTE calculations. There are various risks involved. Do you own diligence before buying