Wednesday, September 3, 2008

Stock Ideas: Vivimed Labs Ltd., Hitachi Home & Life Solutions (I) Ltd., Graphite India Ltd.

Vivimed Labs Ltd. (Code: 532660) (Rs.73.10) is a speciality chemical manufacturer catering to segments like oral care, sun care, skin care, hair care, natural extracts, preservatives, anti microbial, anti oxidants, anti-aging molecule etc. In fact, it is the world’s second largest manufacturer of Triclosan - an antibacterial used for oral care, and one of the top three companies for Avis – a chemical that improves the ultra-violet (UV) absorbing ability of Sunscreen. Couple of months back, it acquired 100% stake in M/s. James Robinson, UK, which is a global manufacturer and supplier of speciality chemicals used in hair dyes, pharmaceuticals and photographic films/prints to ophthalmic sunglasses. Organically, too, the company has been expanding capacity and has chalked out greenfield expansion plans in Uttarakhand and Hyderabad. Considering its Q1FY09 results and the acquisition of the UK company, Vivimed is estimated to post consolidated sales of more than Rs.225 cr. with net profit of Rs.17 cr. This will lead to an EPS of Rs.18 on its current equity of Rs.9.40 cr. whereas its diluted EPS works out to Rs.13 on its diluted equity of Rs.12.65 cr. Accumulate at declines.
Hitachi Home & Life Solutions (I) Ltd. (Code: 523398) (Rs.111.70), a 68% subsidiary of Hitachi, Japan, is among the top air-conditioning companies in India with an installed capacity of 250,000 units per year. It manufactures high technological home and commercial air conditioners like window AC, split AC, concealed splits, ductables, chillers and specific telecom cooling solutions. To capitalise its brand equity and strong distribution network in India, the company has also ventured in the business of trading in refrigerators and washing machines. Its plant at Kadi, Gujarat, is among the seven Hitachi room air conditioner facilities worldwide. Being a technology driven company, it has introduced several innovative products such as ACE, IOTA, ATOM Square, Takumi etc., which are doing well in the market. Its refrigerator and washing machines sales are also picking up. On the other hand, its commercial air conditioning division is also on rampant growth mainly due to the retail sector and mall culture expanding in a big way. The trend of BPOs and R&D centres also augurs well for the company. Although its June 2008 quarter results were not that encouraging, still it is expected to end FY09 with sales of Rs.525 cr. With PAT of Rs.42 cr. i.e. an EPS of Rs.18 on its equity of Rs.23 cr. At current levels, this share is trading reasonably cheap and can be bought for a target of Rs.180 in the medium-term.
Graphite India Ltd. (Code: 509488) (Rs.58.95) is one of the few global players manufacturing graphite electrodes as it is a closely guarded technology. With the present installed capacity of 78,000 tonnes, the company boasts of producing nearly 8% of the total global graphite output. To cater to the rising demand, it is implementing a capex at its Durgapur plant to enhance its graphite electrodes capacity by 10,500 tonnes to be operational by end FY09. Being backward integrated, it has the facility to produce 30,000 MTPA of calcined petroleum coke (CPC) apart from generating 33 MW of power through Hydel and Multi-fuel routes. Further, it is contemplating to enhance its captive power generation by 100 MW in the next two years. Earlier in October 2005, the company raised nearly Rs.175 cr. through the FCCB route, which is yet to be fully converted at Rs.55. Despite being hit by forex losses it posted decent results for Q1FY09 and is estimated to end FY09 with consolidated sales of Rs.1500 cr. with net profit of Rs.155 cr., which works out to an EPS of Rs.9 on its fully diluted equity of Rs.36 cr. with a face value of Rs.2 per share. With a dividend yield of nearly 5%, this is one of the safe picks with a minimal downward risk.

Source: Internet (moneytimes)


The information in this publication is provided by is intended for use for Readers & Traders . Every effort is made to provide accurate information, but cannot guarantee the accuracy of the information or of the market analysis. This is a newsletter and is for informational purposes only. It is not a solicitation or offer to buy or sell futures. There is a high risk of loss in trading futures. You should not trade with money that you cannot afford to lose. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this newsletter. The past performance of any trading system or methodology is not necessarily indicative of future results.

free counter