Sunday, January 31, 2016

International Travel House - Value buy?

The company was established in the year 1981. The company is an associate company of ITC. It offers a bouquet of travel services including car rental, Indian and International holidays, business travel, etc... While looking at the company I found that it is based in Pune, the city where I live.

The average ROCE of the company over the last 10 years is 28.38% and is lower at 27.45% in the last 3 years. The company has current assets to the tune of INR 98 Crore. The average operating cash flow of the company over the last five years is around INR 18.4 Crore. The company has remained profitable and paid dividends over the last 15 years.

The promoters hold 61.69% of the company.

At the current market price of INR 195, the market cap of the company is INR 156 Crore. The stock price is barely trading higher than its price in year 2006 when it was trading between INR 140 and 240. This is about 10 years of no capital gain. The book value of the company has increased from INR 58 to INR 182 during these ten years, the EPS has gone up from INR 8.75 to INR 23. If we remove the net current assets from the market cap, the rest of the company is available at INR 58 Crore which is less than 4 times operating cash flow. The company doesn't seem to be very expensive at this price.
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