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I hold 3,000 shares of KSS (K Sera Sera) at Rs 4 before share was split and 100 shares of ESL at Rs 3.90 per share. What is the future of these stocks?
If we go the quality of balance sheet, the future of KSS is bleak – on a consolidated basis, total capital employed of over Rs 541 crore (including the borrowed money) has gone for financing only equity investments (which do not make any significant returns), loans and advances and trade receivables. Moreover, the promoter stake is zero! Future of ESL is also bleak — it made big investments in the integrated steel business at the wrong time. With the almost complete erosion of its net worth and an annualized revenue of around Rs 2,500 crore, it would be difficult to revive its fundamentals as it is sitting on a debt of around Rs 8,000 crore and other current liabilities of over Rs 4,000 crore.
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