1
Please refer to important disclosures at the end of this report
1
1
NESCO Limited is engaged in activities, including information technology (IT)
park, exhibition and convention centre, manufacture of machinery, equipment
and capital goods, and investments. NESCO has started construction of IT
building 4, having a built up area of approx. 17 lakh sq. ft. (Leasable 12 Lakh
sq. ft.) which is going on in full swing. IT buildings 1 and 2 can be rebuilt based
on new relaxed FSA norms and IT building 3 is yet to be seen in financial
performance. The company is now going ahead to set up a new world class
Exhibition & Convention Centre and have engaged services of an international
architect, in first phase of 15 lakh sq. ft. will be constructed in coming years. The
company recently started cafeterias in Bombay Exhibition Centre and NESCO IT
Park and is receiving good response from clients and is expected to generate
significant revenue and profits. The Company is taking steps to establish a large
world class kitchen of 24,000 sq. ft. which will help to produce 15,000 meals per
day. To add to this the business works on negative working capital and also with
low maintenance cost it has helped the segment generate sizeable free cash flow
every year. The management stated that the cost of expansion of IT park,
Bombay Exhibition Centre and NESCO Hospitality was about `1500cr which will
be met by companys own resources without any borrowings and company is
expected to remain debt free. The management expects that the asset heavy
annuity rental business piggy backing on niche exhibition business, having
negative working capital, makes it a better play in the realty space. The company
has reported a healthy profit growth of 18% CAGR and return on equity of 21%
for the last 5 years. Hence Buy.
BUY
CMP `2,659
0.8
Reuters Code
NSEN.BO
10
BSE Sensex
31,109
Nifty
9,605
Face Value (`)
Miscellaneous
Market Cap (` cr)
3,747
52 Week High / Low
2722/1530
Avg. Daily Volume
1,205
Vaibhav Agrawal
022 3935 7800 Ext: 6808
[email protected]gelbroking.com
NESCO
Others | Miscellaneous
May 30, 2017
2
NESCO | Miscellaneous
May 30, 2017
2
Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com
DISCLAIMER
Angel Broking Private Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India Limited,
Bombay Stock Exchange Limited and Metropolitan Stock Exchange Limited. It is also registered as a Depository Participant with CDSL
and Portfolio Manager with SEBI. It also has registration with AMFI as a Mutual Fund Distributor. Angel Broking Private Limited is a
registered entity with SEBI for Research Analyst in terms of SEBI (Research Analyst) Regulations, 2014 vide registration number
INH000000164. Angel or its associates has not been debarred/ suspended by SEBI or any other regulatory authority for accessing
/dealing in securities Market. Angel or its associates/analyst has not received any compensation / managed or co-managed public
offering of securities of the company covered by Analyst during the past twelve months.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment
decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should
make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the
companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine
the merits and risks of such an investment.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals. Investors are advised to refer the Fundamental and Technical Research Reports available on our website to evaluate the
contrary view, if any.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Pvt. Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.
Angel Broking Pvt. Limited has not independently verified all the information contained within this document. Accordingly, we cannot
testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document.
While Angel Broking Pvt. Limited endeavors to update on a reasonable basis the information discussed in this material, there may be
regulatory, compliance, or other reasons that prevent us from doing so.
This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,
redistributed or passed on, directly or indirectly.
Neither Angel Broking Pvt. Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from
or in connection with the use of this information.
Disclosure of Interest Statement NESCO
1. Financial interest of research analyst or Angel or his Associate or his relative No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives No
3. Served as an officer, director or employee of the company covered under Research No
4. Broking relationship with company covered under Research No
Ratings (Based on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
over 12 months investment period): Reduce (-5% to -15%) Sell (< -15)