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Caselet: A leader in the Security Surveillance domain
(Only for case study purpose as a part of Workshop, no recommendation)
Caselet 3
A leader in the Security Surveillance domain: the first company of its kind
Case:
The share price of the company peaked on 02 Jan 2015 at Rs 187. The trading in the stock is now
suspended due to non- payment of ALF dues.
The IPO came in Jul 2012 at a price of INR 46 per share.
The 2014 Annual report with balance sheet, cash flow and P&L was available by this time (02 Jan 2015
when peak was formed). Could we identify the trouble in the company based on the available data and
what are the top conclusions that we can draw from this data? Draw at least 5 conclusions why it should
be considered or declined to invest based on 2014 data and information provided?
Profile:
The company is engaged in the marketing and selling of Electronic security systems and equipment.
History:
The journey of securing lives began in the year 1994. With over 20 years of unrivalled expertise and
experience, the name is now synonymous to the Electronic Security industry in India.
Currently, the company has its presence over 1100 cities in India, securing over a million of happy
customers with its valued-added security products and services. It stands tall with its thought leadership
in the Security domain having pioneered many a first concepts:
Caselet: A leader in the Security Surveillance domain
(Only for case study purpose as a part of Workshop, no recommendation)
Share price
Extracts of Cashflow
Consolidated Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Cash from Operating Activity -40 0 -114 -16 -42 3
Cash from Investing Activity -19 -35 4 -9 -94 -59
Cash from Financing Activity 87 30 107 20 160 72
Net Cash Flow 28 -4 -3 -5 24 16
Extracts of Balancesheet
Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Share Capital 13 13 13 13 17 18
Reserves 99 110 153 176 225 251
Borrowings 166 224 135 160 318 437
Other Liabilities 85 85 74 63 118 215
Fixed Assets 69 78 87 67 144 147
CWIP 0 15 0 9 6 39
Investments 1 1 1 8 10 10
Other Assets 293 338 286 329 518 725
Trade receivables 133 183 153 206 281 368
Loans n Advances 53 72 69 53 105 153
Caselet: A leader in the Security Surveillance domain
(Only for case study purpose as a part of Workshop, no recommendation)
Extracts of P&L
 Revenue CAGR of last 5 years: 19.75%
 Net profit CAGR of last 5 years: 15.39%
Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Sales 376 528 373 484 691 926
Expenses 323 473 348 433 609 818
Operating Profit 53 55 25 51 83 109
OPM % 14% 10% 7% 10% 12% 12%
Other Income 2 1 55 -1 2 -2
Interest 20 25 15 14 25 35
Depreciation 11 12 15 14 18 25
Profit before tax 24 19 49 22 42 47
Tax % 7% 5% 4% 4% 11% 4%
Net Profit 22 18 48 21 37 45
EPS in Rs 15.24 11.83 35.01 13.26 17.84 23.83
Dividend Payout % 5% 42% 3% 8% 7% 5%
Shareholding pattern (as of Sep 2014)
 Promoter
o 23.07%. 42.48% of promoter holding pledged
 In public/institution category some key holdings:
o General Insurance Corporation of India 1.19%
o Lalanand Vyapaar Pvt Ltd 1.06%
o Bennett Coleman & Company Ltd 2.84%
o Leman Diversified Fund 1.32%
o Ensemble Holdings & Finance Ltd 2.59%
o Bridge India Fund 1.14%
o New Leaina Investments Ltd 3.82%
o Aark Singapore Pte Ltd 16.48%
o V Raman Kumar 2.27%
o Madhavan Kunniyur 1.19%
o Amit Patni 1.15%
Caselet: A leader in the Security Surveillance domain
(Only for case study purpose as a part of Workshop, no recommendation)
Your notes
1) ______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
2) ______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
3) ______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
4) ______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
5) ______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________

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Caselet 3_A leader in the Security Surveillance domain_case study

  • 1. Caselet: A leader in the Security Surveillance domain (Only for case study purpose as a part of Workshop, no recommendation) Caselet 3 A leader in the Security Surveillance domain: the first company of its kind Case: The share price of the company peaked on 02 Jan 2015 at Rs 187. The trading in the stock is now suspended due to non- payment of ALF dues. The IPO came in Jul 2012 at a price of INR 46 per share. The 2014 Annual report with balance sheet, cash flow and P&L was available by this time (02 Jan 2015 when peak was formed). Could we identify the trouble in the company based on the available data and what are the top conclusions that we can draw from this data? Draw at least 5 conclusions why it should be considered or declined to invest based on 2014 data and information provided? Profile: The company is engaged in the marketing and selling of Electronic security systems and equipment. History: The journey of securing lives began in the year 1994. With over 20 years of unrivalled expertise and experience, the name is now synonymous to the Electronic Security industry in India. Currently, the company has its presence over 1100 cities in India, securing over a million of happy customers with its valued-added security products and services. It stands tall with its thought leadership in the Security domain having pioneered many a first concepts:
  • 2. Caselet: A leader in the Security Surveillance domain (Only for case study purpose as a part of Workshop, no recommendation) Share price Extracts of Cashflow Consolidated Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Cash from Operating Activity -40 0 -114 -16 -42 3 Cash from Investing Activity -19 -35 4 -9 -94 -59 Cash from Financing Activity 87 30 107 20 160 72 Net Cash Flow 28 -4 -3 -5 24 16 Extracts of Balancesheet Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Share Capital 13 13 13 13 17 18 Reserves 99 110 153 176 225 251 Borrowings 166 224 135 160 318 437 Other Liabilities 85 85 74 63 118 215 Fixed Assets 69 78 87 67 144 147 CWIP 0 15 0 9 6 39 Investments 1 1 1 8 10 10 Other Assets 293 338 286 329 518 725 Trade receivables 133 183 153 206 281 368 Loans n Advances 53 72 69 53 105 153
  • 3. Caselet: A leader in the Security Surveillance domain (Only for case study purpose as a part of Workshop, no recommendation) Extracts of P&L  Revenue CAGR of last 5 years: 19.75%  Net profit CAGR of last 5 years: 15.39% Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Sales 376 528 373 484 691 926 Expenses 323 473 348 433 609 818 Operating Profit 53 55 25 51 83 109 OPM % 14% 10% 7% 10% 12% 12% Other Income 2 1 55 -1 2 -2 Interest 20 25 15 14 25 35 Depreciation 11 12 15 14 18 25 Profit before tax 24 19 49 22 42 47 Tax % 7% 5% 4% 4% 11% 4% Net Profit 22 18 48 21 37 45 EPS in Rs 15.24 11.83 35.01 13.26 17.84 23.83 Dividend Payout % 5% 42% 3% 8% 7% 5% Shareholding pattern (as of Sep 2014)  Promoter o 23.07%. 42.48% of promoter holding pledged  In public/institution category some key holdings: o General Insurance Corporation of India 1.19% o Lalanand Vyapaar Pvt Ltd 1.06% o Bennett Coleman & Company Ltd 2.84% o Leman Diversified Fund 1.32% o Ensemble Holdings & Finance Ltd 2.59% o Bridge India Fund 1.14% o New Leaina Investments Ltd 3.82% o Aark Singapore Pte Ltd 16.48% o V Raman Kumar 2.27% o Madhavan Kunniyur 1.19% o Amit Patni 1.15%
  • 4. Caselet: A leader in the Security Surveillance domain (Only for case study purpose as a part of Workshop, no recommendation) Your notes 1) ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ 2) ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ 3) ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ 4) ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ 5) ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________