Your Stock Queries
3/7/2013 9:00 PM Thursday
I have bought 1100 share of Bartronics India at Rs 145 per share. Should I hold these or exit the counter?
Jyoti Raichura, Via Email
|BSE/NSE Code ||532694/BARTRONICS |
|Face Value ||Rs 10 |
|CMP ||Rs 16.15 |
|52-Week High/Low ||Rs 41/Rs 16|
|Current Profit/(Loss) || |
88.86 per cent
Let’s begin by admitting that you are seeking advice too late. Look at the 52-week high/low of the scrip. You have bought into it much before even that. Now consider what the company is. Technology has revolutionised the way we live. It touches every bit of life from the smallest to the most complex of human needs. The company that you are talking about is one which deals with such technology. Bartronics provides automatic identification and data capture (AIDC) solutions. Its products are used in various applications, such as access control, building management, crowd and patrol management, and retail security. Have you seen the way products are tagged at malls today? You cannot carry any product outside the shop without having billed for it, thanks to the tags. That is the power of technology embedded in the tags attached to the products. Bartronics supplies that technology. The company’s products also have applications in HR and time attendance management, healthcare and hospital management, patient tracking and patient flow management. But being in a niche category is one thing and translating it into good fundamental and financial strength is another.
On the financial front, Bartronics’ performance has been quite dismal. In the recently concluded Q3FY13, its topline declined by 61.86 per cent on a YoY basis to stand at Rs 41.30 crore as against Rs 163.82 crore during the same period last year. The bottomline too stood at a mere Rs 0.06 crore for Q3FY13 against Rs 46.37 crore for Q3FY12. The only consolation about this company is that it has been able to come back with profits after having reported losses in three preceding quarters. It has a debt of Rs 676 crore in its books which translates into a debt to equity ratio to 1.46x. What is primarily afflicting the company is a good amount of competition from cheaper imports, especially from China. Unless it addresses this issue there is no way that it can improve fundamentally. So, for now, we suggest you to exit the counter even if you have to book losses. We certainly understand the pains of having to exit at such a steep loss, but you better take this step so as to avoid further losses.
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