Home > Market View > RCOM results – Analysts are confused

RCOM results – Analysts are confused

Saturday, August 1, 2009 Leave a comment Go to comments

Came across this interesting story about RCOM and its results. The most interesting thing to note is:

“How is it that the company has reported a net interest income of Rs620.5 crore despite having a net debt of Rs22,163 crore?”

“The firm also continues to have a high capital work-in-progress (CWIP) on its balance sheet of at least Rs10,000 crore. According to an analyst with a foreign brokerage, who declined to be named, almost all of the company’s projects have been commissioned and it’s surprising that CWIP continues to be as high.

Needless to say, once this amount is capitalized on the balance sheet, depreciation charges would rise and reported profit decline.

Sometimes I wonder how such big companies manage to do such stuff? Where are the auditors? Have they hired PWC?

Coming to RCOM stock price, the stock seems to be in a sideways mode with a downward bias. I’d avoid the stock and look it for short term trading once it crosses 300.

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  1. Saturday, August 8, 2009 at 12:34 am

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