Jubilant Foods: 995-975 May Be A Good Support Despite Weak SSSG & Adverse CSE Report (Another Example Of Buying Good A Business In Temporary Distress ?)

Trading Idea: JFL

CMP: 1018

Either buy around 995-975 OR on dips around 945-925

TGT: 1050-1095*-1130-1170-1220-1252-1315*-1372-1435*-1535 (1-3/6M)

TSL< 960 OR < 915

Note: Consecutive closing (3 days) below 915, JFL may further fall towards 885*-840-790-745* and 675-640*-590 in the near to long term (alternative bear case scenario from the current trading level).

For JFL:

Q4FY16 TTM RPS: 17.36 (FY:16/Actual)

Projected FWD EPS: 19.50-22.25-26.05 (FY:17-19/Estimated)

(If there is good monsoon and growth in Indian consumption story amid 7PC.OROP induced liquidity based growth in actual consumption apart from discretionary spending)

Average PE: 65 

(Actual average PE 75; now trading around 53 after below expected Q4FY16 result amid fall in SSSG; historically, JFL enjoyed abnormal higher PE because of its business model, debt free BS and scarcity premium)

As par BG metrics & current market volatility:

Present median value may be around: 1165 (FY:16/TTM)

Projected fair value might be around: 1235-1325-1425 (FY:17-19/FWD)

 

JUBLFOOD	EPS	BV	P/E	Low	High	Median	200-DEMA	10-DEMA
Q4FY16/TTM	17.36	102.03	65	1218.13	1107.76	1162.95	1315	1087.5
FY17/FWD	19.5	120.25	65	1291.03	1174.06	1232.54	1315	1087.5
FY18/FWD	22.25	143.75	65	1379.06	1254.11	1316.59	1315	1087.5
FY19/FWD	26.05	168.95	65	1492.19	1356.99	1424.59	1315	1087.5

Analytical Charts: