While the company has deployed about Rs 11.56 crore in inter-corporate deposits, some funds have been used to retire high cost debt. Its investments have increased from Rs 4.99 crore in 1995-96 to Rs 7.30 crore in 1996-97. Major investments are Rs 1.14 crore in the preference issue of SMIFS Capital Markets and around Rs 61 lakh in HPCL warrants. However, the market value of its total investments has eroded by 50 per cent. It has invested Rs 2.65 crore in the share capital of Jersey India, a group company which is making losses.
The company's receivables have gone up to Rs 6.28 crore from Rs 1.05 crore in 1995-96. The company's clientele comprise jelly filled cable manufacturers who are facing payment delays from DoT. However, the company is expecting this to come down in the current year.
The company's share price at Rs 30 is quoting at a steep discount to its book value of Rs 107 and is undervalued, according to U R Bhat, chief investment officer, Jardine Fleming India AMC. The dividend yield on the scrip is also relatively high at around 12 per cent. MSL has procured good orders for its steel strappings, and will see a change in its fortunes when the telecom industry takes off.