Competent Automobiles Company Limited.

The Company's principal activity is to trade and servicing of vehicles. The Company operates in two segments, namely, Showroom and Services and Spares. The Showroom segment deals with purchase and sale of new Maruti Udyog Ltd vehicles. The Service and Spares segment includes servicing and spare parts sale of Maruti Udyog Ltd. It operates through 9 showrooms situated at New Delhi, Haryana and Himachal Pradesh. The Company's workshops are located at Delhi, Haryana and Himachal Pradesh.
The market cap of the company is around 26 crores and has a net current asset value of around 15 crores. The Net Current Asset Value concept involves identifying companies that are trading at below the level of the current assets on the balance sheet less all liabilities. Current assets consist primarily of cash and cash equivalents, trade receivables, and inventories. These are assets that are either cash or convertible into cash within a relatively short timeframe (usually less than a year). From current assets, one subtracts all liabilities on the balance sheet, not just current liabilities. This value is then compared against the market valuation of the company.
Even though the company is not trading bellow the ncav it seems cheap on an earnings basis. Also even if the company is trading below ncav it might end up destroying shareholder value if it has a negative cash flow however this is not the case with competent automobiles. For the financial year 2009 the company produced 9 crores in operating cash flow and incurred capex of around 3 crores resulting in FCF of around 6 crores. So the company trades at 4 times free cash flow.