Tribhovandas jeweler is ones of
the most respected jewelers in North India for their quality product in the
gold segment. They entered into the equity market with full fanfare but faced
the turbulent time post dismal performance. Management quickly identified the
gap and move strategically to start increasing its footprint through franchisee
model in tier 2 and tier 3 cities.
The stock price stumbles from 180 level to
60 INR in the last one year. Company in recent quarter made respectable profit
and the market capitalization's is also under 500 Cr.
As global economy is again
entering into economic crisis thanks to confusion created by UK referendum
coupled with unrest in Middle East. The lack of economic growth and the signal
supported by US Federal Reserve indicate the investor to turn towards Gold and
the price went above $1400 ounce.
It is expected that the gold price will cross
$1550 in coming quarter. At the same time, Indian economy is coming on track
and the monsoon is tracking in the right
direction which in turn will give more bump to gold buyer community during
festive time especially in tier 2 and tier 3 where Tribhovandas already showing
their presence.
It will help company to increase their margin and subsequently
increased profitability which will attract retail investor towards the company
equity. In my point of view, the stock price may jump more than 50 % very
quickly with little good news flow from the company.
Disclaimer - Consult your
financial consultant before investing
