MOIL is a “Mini Ratna” awarded company, functioning for more than four decades in the industry of manganese ore mining and mining operations. It has a good monopoly with a majority share (more than 50%) in Indian manganese production and it is also one of the lowest cost producers of manganese ore in the world. MOIL is now entering the capital markets with a public issue (IPO). IPO opens for subscription on 26 November 2010 and closes on 01 December 2010. Price band is Rs.340 – 375.
Also a debt free company, so it has a healthy balance sheet with strong cash flows. As on H1 FY-11, its cash balance stood at Rs.17.6 billion, which translates into Rs.105 per share (sounds very healthy). It has witnessed revenue and PAT CAGR of 31% and 42% respectively, over the last four years. Presently, it is enjoying OPM of 70.3% and PAT margin of 52.1%.
Whats our view: We strongly recommend investors to ‘SUBSCRIBE’ the issue. As we see strong listing gain with a valuable company.