Country Club Ltd.
 
  

 

SHARETIPSINFO >>Research Reports >> COUNTRY CLUB (INDIA) LIMITED (26-08-2009)

 

LISTING
CMP

Rs 20

52 WEEK HIGH/LOW
Rs 78/Rs 6.8
FACE VALUE
Rs 10
AVERAGE VOLUME

521883

MARKETCAP

Rs 129 Crore

COMPANY OVERVIEW:
In 1989, Mr. Rajiv Reddy known for his entrepreneurial capabilities and foresight acquired the imposing Vilayat Manzil, the palace of Nawab Wali-Ud-Daula in Hyderabad and converted it into what is now known as The Country Club in Hyderabad and thus the Country Club was born.
CCIL (Country Club India ltd) is one of the fastest growing entertainment and leisure conglomerate in India. CCIL is a pioneer in the concept of family clubbing in the country.
CCIL has established 186 properties of which 35 are owned and 158 are franchised properties.
Presently it has 220 plus affiliation plus a global gateway via country vacation and RCI affiliation of 3900 resorts for its esteemed members.
Factors Driving the Clubbing Industry Growth:
Growth in the number of urban middle class. The middle class population is increasing at rate of 20 million annually. 
The average spending by the Indian have increased in the over the last decade.
Under the major head of consumption the fastest growth came from the leisure and entertainment.


KEY REASON FOR INVESTMENT:
Industry is growing at double digit because of the rising income.
Mahindra Holiday listing brought the industry into focus.
All the negatives have been discounted in the stock. Any simple positive can drive the price of the stock. The earning has slumped and simple increase will see good percentage increase due to the base effect.
As the economy is reviving it will help company to be back on growth path after the decline in financial performance last year.

KEY RISK:
Delay in global economy revival.
Increase cases of pandemic like H1N1.

SHAREHOLDING PATTERN:

 

 

NO.OF SHARES

% OF TOTAL

PROMOTER

34597386

 

44.69%

 

INSTITUTION

13786658

 

17.80%

 

GENERAL PUBLIC

29040691

 

37.51%

 

GRAND TOTAL

77424735

 

100.00%

 

FINANCIAL:

 

 

31/03/06

31/03/07

31/03/08

31/03/09

TOTAL INCOME

64.9

147.07

314.24

292.93

 

 

 

126.50%

113.60%

-6.80%

EXPENDITURE

-43.26

-92.15

-193.8

-251.18

PBDITA

 

21.64

54.92

120.44

41.75

 

 

 

162%

118%

-65%

DEPRECIATION

-3.26

-4.6

-6.53

-11.44

PBIT

 

18.38

50.32

113.91

30.31

INTEREST

 

-2.78

-4

-12.64

-13.52

PBT

 

15.6

46.32

101.27

16.79

TAX

 

-1.67

-12.29

-36

-7.09

PAT

 

13.93

34.03

65.27

9.7

 

 

 

142%

91%

-85%

Key Highlights:
Total Income grew Yoy at an average of 77%. In FY2009 the Total Income declined by 6.8%, due to the slump in the financial market.
PBDITA grew Yoy at an average of 71%. In FY2009 the PBDITA down by 65%. Decline is attributed to the increase in expenses.
PAT grew Yoy at an average of 50%. In FY2009 the PAT slumped by 85%. Increase in interest rate and depreciation is the main reason.
RATIOS:

 

 

31/03/06

31/03/07

31/03/08

31/03/09

EPS

 

1.797419

4.390968

8.421935

1.251613

PBDITA MARGIN

33.34361

37.34276

38.32739

14.25255

NPM

 

21.46379

23.13864

20.77075

3.311371

INTEREST COVER

6.564286

12.58

9.011867

2.241864

Key Highlights:
Eps down in FY2009 from Rs8.4 to Rs1.25.
PBDITA margin down in FY2009 from 38% to 14.25%.
NPM slumped in FY2009 from 20.7% to 3.3%.
Interest cover is still healthy but is down from 9 to 2.2 in FY2009.


COMPARISION OF Q1FY2010 WITH Q1FY2009:

 

 

Q1FY2009

%CHANGE

Q1FY2010

TOTAL INCOME

104.76

-46.63

 

55.89

EXPENDITURE

-68.9

 

 

-46.4

PBDITA

 

35.86

-73.50%

 

9.49

DEPRECIATION

-2.64

 

 

-3.08

PBIT

 

33.22

 

 

6.41

INTEREST

 

-3.6

 

 

-1.9

PBT

 

29.62

 

 

4.51

TAX

 

-10.35

 

 

-1.54

PAT

 

19.27

-84.50%

 

2.97

Key Highlights:
Total Income came down on QoQ basis by 46%.
PBDITA declined on QoQ basis by 73.5%.
PAT moved down on QoQ basis by 84.5%.


VALUATION:
We expect the FY2010E EPS to double from here at Rs6 as the economy moves out of recession this year. So the stock is trading at 3.3X to FY2010E EPS. We value the company at 6X, the fair value we arrive at is Rs36.

CONCLUSION:
The stock is high risk high reward counter. The investors with bit of risk appetite should buy it at current level. The investment time period would be 6 to 8 months.

 

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