Query Trends : Empee Dist

Query : I got 59shares in allotment of Empee Dist IPO. Please advise what should I do as the share is heading down. Should I book losses.? Manish

I am holding 216 shares allotted in recent issue. What is the future of prospect, can I purchase from market? as it is available at 20% discount. Vkjca

Thebullishtrends : Empee Dist shares closed yesterday at Rs.291 in BSE. Chennai based Empee Dist recently came to IPO. It offered Rs.400 per share. Empee Dist shares listed in BSE at Rs.440, and immediately touched the bottom level. Infact it is one of the good company but the price for IPO steeply placed, and another thing is sentiment on Liquor companies is poor in the market from a particular community.

At present it is having business in TN and Kerala,whereas the company proposes to operate in AP and Karnataka. Empee Dist is setting up a 10 MW biomass power plant in TN and it will sell this power to TN State Electricity Board. It also plans to set up 60klpd grain based distillery and blending & bottling Indian made-foreign-liquor plant with capacity of 0.07 lakh cases per month. It is also expanding it's existing distillery, and developing 2 lack square feet of residential space in Mevalorkuppam. It is having very good realty space in 20.88 acres of land in Kanchipuram.

The present EPS discounts the current price of Rs.291 by PE 66 times. Infact the financial year for the company is Sept to Sept. The company is expecting margins 8% for this financial year (Sept'08). The expected EPS will be Rs.29/-looks good the present price disctounts PE only 10times. But the only thing is you have to wait another 6-9 months to get the benefit from this share.