BSE ID : 512237 NSE ID : JAICORPLTD
RECOMMENDED PRICE 75.50
PEAK FROM RECO 223.30 195.76%
CURRENT PRICE 138.35 83.25%
Jai Corp Rerating Likely as Ministry of Environment and Forest set to give final nod for clearance of the Navi Mumbai Airport.
Jaicorp is available at market cap of 1300 cr with appx 350 crore investment in Reliance industries. Since 2012 there have been speculation of Jaicorp willing to exit its SEZ holdings, finally clearance will pave way for Jaicorp exit of its SEZ holdings both NMSEZ and MMSEZ
A word of caution, analyst have been working with 2000-3500 cr worth of SEZ valuation on Jaicorp’s SEZ apart from this company via its real estate investment also owns decent land bank , otherwise too a very small business that gives a decent profit and gives EPS of close to 4-5 rs thus justifying the valuation to an extent . Current business value 50-55 adding the SEZ others near about 140 applying holding discount
It’s a high risk trade but once there will be clarity the price of stock is likely to test the median of 110 and 140 which have been long awaited for the stock as only trigger is the Navi Mumbai Land portfolio via SEZ which as per reports are to tune of 4150 acres handed to NMSEZ and 1850 acre of 5000 in MMSEZ has been registered .
Development work seen and first sign of movement: Here are some recent developments in NAVI Mumbai that make the stock interesting
Gayatri Projects and Supreme infra awarded the projects : the work awarded is land leveling for the construction of the airport and cutting of Ulwe Hill (80 metres) to fill the marshy land in Navi Mumbai. Contracts worth Rs 398 crore and Rs 700 crore was awarded to Supreme Infrastructure and Gayatri Projects respectively. An area of 1,160 hectare (2,800 acre) will be leveled for the construction of the airport.
Predevelopment work of shifting of High tension power cables in the region
Diversion of river
Interestingly the newspaper article from DNA quotes CIDCO official stating this is the last hurdle at ministry level for nods for Phase 1
About Jai Corp
Jai Corp was incorporated in 1985. It has traditionally been into manufacturing businesses like steel, plastic processing and spinning yarn. Apart from expansion of its plastic processing business, it is now focusing and investing in emerging opportunities like developing SEZs, infrastructure, venture capital and real estate.
Technical & Quant update:
The stock has been oscillating well between 68 and 80 and for the first time has given a monthly closing above 75. If news and events are to be combined DNA report suggest clearance nod expected this week. Thus if it’s a technical breakout on the above fundamentals its likely that maintaining a stop-loss of 71. The stock likely to test 94 and if the news happens to be true the stock is likely to test 94, 110 and 140 median of 2013 and 2011.
The structure looks a different this time as the news have been there and steps are taken and visible by the State government on the same, compared to older times which turned out to be a fake breakouts all the time as no development was visible on ground.
Other notable plans of company
Real Estate :Jai Corp is planning to develop township projects at:
(i) Sinnar Road, Nasik (Maharashtra)
(II) N.H.4, Pune-Mumbai Road, Pune (Maharashtra)
(iii) Village Talegaon, Barwai and Bhokarpada (Panvel - Maharastra)
(iv) Village Aajiwali and Borle (Panvel - Maharastra)
Venture Capital via its subsidiary: Jai Corp is in the business of venture capital through its wholly owned subsidiary, Urban Infrastructure Venture Capital Ltd. Urban Infrastructure Venture Capital Ltd. is a Venture Capital Management Company.It is currently managing / advising two funds, Urban Infrastructure Opportunities Fund and Urban Infrastructure Real Estate Fund, with a total fund corpus of over USD 820 mn.
SEZ land value is more than the entity as whole thus a calculated risk reward as mentioned below
ALERT: ONLY for QUANT /High risk traders/investors to exit the call if event does-not comes out to be material MOEF not giving clearance and can be satisfied with a risk reward of 5 for 18 and 5 for 34 and riding higher levels with increasing stop from 1 week to 3 month perspective
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Disclaimer: Aashish Tater is an investment adviser based in Kolkata, INDIA. At the time of writing this article, he, his firm and dependent family members have no position in the stocks mentioned above. The author invites readers to send him email and welcomes comments, feedback & queries at email@example.com. This report has been prepared solely for information purposes and the information contained herein may not be deemed to be an investment advice. Such information is impersonal and not tailored to the investment needs of any specific person. The information contained herein is not a complete analysis of every material fact representing any company, industry or security. The views expressed may change. While the information contained herein has been obtained from sources believed to be reliable, no responsibility (or liability) is accepted for the accuracy of its contents. Investors are advised to satisfy themselves before making any investments and should consult with and rely upon their own advisors whether and how to use such information in making any investment decision. Neither the author nor his firm accepts any liability arising out of use of the above information/ article.