Intraday Trading Calls for 31st August

Indian Stock Market may open negative and negative with very high volatility.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
PSL LTD.	Buy Above	158.70	164.20	170.00
	Sell Below	156.35	151.10	146.00
ICSA	Buy Above	198.60	205.05	211.00
	Sell Below	196.10	191.35	186.00
IDFC	Buy Above	132.75	136.15	140.00
	Sell Below	130.45	127.15	124.00
STC INDIA	Buy Above	377.25	384.45	392.00
	Sell Below	372.35	364.10	356.00
REL POWER	Buy Above	162.25	166.50	171.00
	Sell Below	159.70	155.75	151.00
GMR INFRA	Buy Above	143.25	147.25	152.00
	Sell Below	141.05	137.10	134.00
ASTRA MICROWAVE	Buy Above	84.25	87.65	92.00
	Sell Below	82.40	79.35	75.00

GOOD LUCK

Stock Idea: Redington India Ltd

Redington India Ltd (Rs 226)
(BSE Code- 532805 NSE Code- REDINGTON)
(P/E- 10, FY09 Revenues - Rs 12,668 cr, Market Cap - Rs 1,760 cr)
Redington is the distributor for a range of IT products such as personal computers, laptops, servers, networking products and packaged software. It has vendor relationships with all the major names in this segment such as HP, HCL Infosystems, Acer, IBM, Intel and Cisco. This segment contributes over 85 per cent of its revenues. The company has also started distributing products such as mobile handsets of Nokia, Microsoft X-Box, Apple iPods, Mac and consumer electronic products. Redington's revenues have grown at a compounded annual rate of 39% over the three years to Rs 10,883 cr. in 2007-08, while net profits grew at a CAGR of 47.5% to Rs 136 cr.. For the year ended March 2009, net sales grew 16.4% to Rs 12,668 cr., whereas net profit grew 17% to Rs 159.6 cr. The EPS on a equity of Rs 77.87 cr.(Promoters'stake-44%) stood at Rs 20.5 and the dividend declared was 40%. The business is reliant on volumes and offers wafer-thin margins. Though they remain narrow, Redington's net profit margins have improved (from 0.69% to 1.25% in the last five years) due to the reselling of better margin products such as networking products, lifestyle gadgets and contributions from improved after-sales and post-warranty service. Redington generates 53% of its revenues domestically, and the rest from South East Asia, West Asia and Africa. The company's customer base is now at 14,458 corporate clients, spread across as many as 44 brands and caters to a wide range of sectors. Players such as HP and HCL Infosystems, and Wipro that dominate the domestic PC market, have continued to have strong relationship with Redington, thus assuring it of sustained volume growth.
According to a recent IDC report, the domestic IT hardware market is set to grow at an annual rate of 14.6% to Rs 96,558 cr. by 2012, while the packaged software segment is set to grow at a rate of 20.9% to Rs 21,129 cr., representing a huge opportunity for players such as Redington. Increased Governmental spending on IT-enablement across the country is another important growth driver for the company. The prospects are especially good for the better margin laptops, which have outpaced desktops in terms of sales growth in India and West Asia. The growth prospects for West Asia and the African region are equally impressive for IT hardware and software. Redington, with its relationship with all the big names in the IT business, would be well placed to tap this opportunity.
In addition to hardware, the company has begun to resell packaged software as well and has tied up with players such as Adobe to distribute their products in India. This could usher in better margins, as does the expansion into networking and data storage products. The company has also diversified into distribution of non-IT products such as mobile handsets of Nokia in Africa and other digital and consumer electronic products across India and West Asia. This segment contributes less than 10% of the current revenues and may serve as a good diversification strategy over the long run. Redington has also added to its offerings, high-end repair, warranty and post-warranty services. These are aimed at capturing annuity-based revenues, in addition to hardware sales. This apart, Redington has leveraged on its existing distribution network to venture into third-party logistics and has acquired spaces in Chennai, Delhi and Kolkata and Dubai.
For the Q1 ended June Dec. 2009, Redington has reported net profit of Rs 37.35 cr.(up 10%) on net sales of Rs 2,922 cr (flat) on consolidated basis. At current valuations, the stock trades at 11 times its FY 2009 earnings (Rs 20.5) and 9.4 times its estimated FY 2010 earnings (Rs 24). Redington's strong positioning in the domestic IT market and the absence of listed peers make the stock attractive. Accumulate on declines for decent returns in the medium-long term.

Source: Internet (Valuenotes By Sanjay Chhabria)

Stock Idea: Cosmo Films Ltd.

Cosmo Films Ltd(Rs 103)
(BSE Code- 508814 NSE Code- COSMOFILMS)
(P/E- 4, Market Cap- 200 cr, FY09 Sales- Rs 655 cr)
Cosmo Films(CFL) is one of the leading players in production of biaxially oriented polypropylene (BOPP) films. The product is used mainly by FMCG players like Parle, Britannia, Hindustan Unilever, Nestle and Dabur, which use tetrapacks and BOPP films for packing their products. Cosmo currently has an aggregate capacity to manufacture up to 96,000 tpa of BOPP films, which will be enhanced to 105,000 tpa by the first quarter of '10. The company not only supplies to FMCG multinationals operating in India and local players, but has also established its presence in overseas markets like the US and Europe. At present, close to 55% of the company's net sales are accounted for by exports. In India, the company faces competition from Uflex and Jindal Polyfilms. Apart from BOPP films, the company manufactures thermal films with annual production capacity of 21,000 tpa. This is a value-added product, made out of BOPP films, which carries a higher realisation.
The Indian BOPP market is estimated at 1.70 lakh tonnes and growing at 20% a year, with Jindals being the biggest producer of this product. Cosmo, promoted by Mr Ashok Jaipuria, operates two plants with six lines of production in Aurangabad and Vadodara. The demand for BOPP packaging material is increasing in India due to the retail boom. The major end-users of this product are food, confectionery, cosmetic, toiletries, label films, and cigarettes makers. CFL is now also looking at new geographies, with focus on parts of Africa and Eastern Europe. The global demand for BOPP products is estimated at 4.7 million tonnes and growing at 4-5% annually.
For the Q1 ended June 2009, Cosmo's domestic sales volume increased by 39% whereas export volume declined by 9% resulting in 5% drop in net sales to Rs 176.06 cr.. Higher interest/Depreciation due to commissioning of new BOPP line in March 2009 lead to 14% lower PAT at Rs 12.41 cr.. The EPS for Q1 stood at Rs 6.4. During FY09, Cosmo's net sales grew to Rs 655 cr from Rs 585 cr. in FY08. The slow growth was on account of the company's conscious decision to go slow on production in anticipation of a possible downturn in the BOPP cycle. The PAT was marginally down to Rs 42.74 cr. from Rs 44.5 cr. in FY08. PAT after extraordinary item (due to change in method of depreciation, there was surplus of Rs 44.72 cr.) was Rs 87.46 cr. On a equity of 19.44 cr.(Promoter's stake- 44%), the EPS before extraordinary item stood at Rs 22 and dividend of 50% was declared. CFL also completed the acquisition of GBC Commercial Print Finishing with global revenues of approx. $100 mn. Post this acquisition, CFL is expected to successfully establish itself as the global leader in thermal lamination segment. At the current market price of Rs 103, the scrip trades at 4.7 times its FY 2009 earnings (Rs 22) and 4 times its estimated FY 2010 earnings (Rs 26). Cosmo has one of the highest dividend yields among its peers at 4.85%. The stock holds good potential for appreciation in the next six months. Accumulate.

Source: Internet (Valuenotes By Sanjay Chhabria)

Stock Idea: Power Finance Corporation (PFC)

A Navaratna PSU, Power Finance Corporation (PFC) reported a steady growth in its standalone net profit for first quarter ended 30th June 2009. Total income rose 31% on a YoY at Rs.1893 crore. Net Interest Income increased by 36% to Rs. 700 crore. Net profit increased by a very healthy 87% to Rs. 555 crore.

What was gratifying to note was that Net NPA was at a low level of 0.01% of net loan assets; meaning loan quality has remained good with a miniscule portion of bad loans.

Its sanctions also increased by 24% to Rs. 18,782 crore. Disbursements were lower by 8% at Rs.4345 crore. Sanctions continue to be dominated by state sector, which was up 47%, central sector was up 20%, joint sector was at 8% and that to the private sector was at its highest, up 26%. What this means is that one would see higher disbursements coming in Q2. PFC’s targets for the current fiscal is Rs.60,000 crore in sanctions and Rs.23,000 crore in disbursements.

Its debt equity at the end of current Q1 stands at 4.85 and capital adequacy is at 17.51% as against 16.75% in Q1FY09. Book value is very healthy at Rs.98.57.

PFC had tapped the primary market in 2007 with a Rs.997.19 crore issue. It was priced at Rs85 per share and got listed at Rs.113. Today it is quoted at around Rs.215 levels, which continues to remain a very good deal for the original shareholders even now, even in this market.

PFC is the dominant investor in the country's power sector, funding about 20% of the projects. PFC has been designated as a nodal agency by the union government for facilitating the development of UMPPs and with six more UMPPs to go, PFC seems to have its work all chalked out! Power is one of the sectors, which is expected to get the maximum impetus, and irrespective of any slowdown or inflation, the growth of this sector will continue relentlessly. PFC remains a good stock in the portfolio.

Source: www.premiuminvestments.in (By S P Tulsian)

Intraday Trading Calls for 28th August

Indian Stock Market may open negative and remains flat to negative with very high volatility.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
PSL LTD.	Buy Above	158.50	164.20	170.00
	Sell Below	155.35	151.10	146.00
GMDC	Buy Above	113.60	118.20	124.00
	Sell Below	111.10	107.15	102.00
IRB INFRA	Buy Above	218.60	224.35	230.00
	Sell Below	214.70	208.65	202.00
STC INDIA	Buy Above	367.20	374.15	382.00
	Sell Below	361.35	354.35	346.00
BRFL	Buy Above	207.25	212.35	218.00
	Sell Below	203.40	196.75	191.00
GMR INFRA	Buy Above	143.25	147.25	152.00
	Sell Below	140.35	136.45	132.00
ASTRA MICROWAVE	Buy Above	80.10	84.25	89.00
	Sell Below	78.15	75.20	71.00

Buy Astra Microvave Products Ltd. (532493) CMP Rs. 79/- Short to Med Term Target Rs. 125/-.

GOOD LUCK

Stock Idea: Colgate Palmolive Ltd.

This MNC whose brand name is almost the generic name for toothpaste in India, has done pretty well for itself for the first quarter ended 30th June 2009. YoY, net sales were up 19% at Rs.485.40 crore. Its business continues to be driven by toothpaste and it achieved a volume growth of 12% in this category. It now has a market share of 52.3%, which makes it the market leader in this segment. In the toothbrush category, volume market share has increased to 38.2% and in the toothpowder category to 48.8% in Q1FY10.

Net profit for the quarter was at Rs.102.8 crore, an increase of 43% on a YoY. The company has been working on reducing costs and this to a large extent has helped shore up the margins. Operating cost for current Q1 was at Rs.362.83 crore which was 75% of the net sales. As against this, in Q1FY09, operating cost was at Rs.341.50 crore, which was 84% of the net sales, clearly YoY there has been a reduction vis-à-vis the sales. Even sequentially, costs have been reduced, which in Q4FY09 was 80% of the net sales. This reduction is cost has been reflected in the margins – OPM was at 27.02% v/s 23.86% in Q1FY09 and NPM improved from 17.64% to 21.17%.

And the major cost reduction has come by way of reduction in advertising and sales promotion costs, which YOY was down 16% and has remained more or les flat on a QoQ at Rs.69.31 crore.

This is one of the best MNC stocks on the BSE. Apart from having a negligible interest outgo, reserves of over Rs.200 crore (as on 31st March 2009), this is one MNC, which is not dependent on the monsoon for rural India’s demand. Irrespective of the rains, the demand for toothpaste and tooth powder does not go down. Stay invested and one can accumulate for long term on declines.

Source: www.premiuminvestments.in (By S P Tulsian)

Stock Idea: Infotech Enterprises Ltd.

Company Overview—
Infotech Enterprises Ltd , promoted by B V R Mohan Reddy was incorporated as Infotech Enterprises Pvt Ltd in August 1991 for creating facilities for software development and its export. Commercial operations began in September 1992. Company went public in March 1997. Company’s first project on creation of facilities for Computer Aided Design and Drafting and Geographical Information Systems (GIS) was successfully completed in September 1992, with aid from IDBI under its Venture Capital Scheme. Main areas of the company are Computer Aided Design (CAD) and GIS. It provides technical software services and has diversified into Business Software Services and Net Services (Internet and Intranet-related services). It also has Engineering Services and Geo-Engineering divisions. Company has strategic alliances and business partners in USA, Europe, Australia and Japan.
Products & services—
Infotech Enterprises is a global software services company specializing in geospatial, engineering design and IT solutions. Company provides its services to improve companies’ speed to market, optimize resources and reduce costs, thereby creating measurable business impact. Key areas of its services are as follows—
Geographic information system—
Infotech has carved a niche for itself in the GIS market space and is recognized as a leading global GIS service provider. Infotech possesses strong domain knowledge and complete solution capability and is focused on the creation of enhanced value for its customers. Infotech has over 1000 GIS professionals working round-the-clock providing over two million person hours of experience in GIS services. Infotech is one of the largest offshore providers of digital Photogrammetry services. Based on extensive technical resources, infrastructure and global delivery capability, it manage, execute and deliver large projects to customers worldwide, providing them the benefits of high-quality, cost-effectiveness and reliable delivery. It offers complete end-to-end GIS solutions to help organizations scope, design, build and manage their GIS. Infotech provides the Managed Application Service to all clients who have had a bespoke application built for them. The MAS is an all-encompassing agreement that covers every aspect of support and maintenance specifically within the GIS field. Infotech provides a wide range of training courses in the latest GIS software. Courses are interesting and relevant to provide users with the confidence and skills to make desktop mapping work for the organization.
Engineering Design—
Infotech offers integrated engineering design solutions in focused domain areas. Infotech has developed robust cross-border collaborative processes that enable a seamless integration with customer design team. Company is able to undertake complex engineering tasks and effectively deliver high quality results that are critical to its customers.
IT services—
Infotech provides services in the areas of ERP, EAI, Business Intelligence, e-biz, Web enabling of business processes as well as maintenance/enhancement of legacy systems, Corporate Portals and Knowledge Management. It is enhancing the customers Business Processes using technology as an enabler to create competitive advantage. Its platform expertise includes IBM, Microsoft, Plum Tree, Seebeyond, SAP, Oracle, SUN and BEA, Documentum.
Electronic Design services—
Infotech has executed projects for global customers enabling them to reduce time to market, optimize resources and reduce costs. Its EDS team is well experienced in design of Analog, Digital and Real time embedded systems and is capable of developing products using a variety of 8, 16 and 32 bit Micro-controllers and DSPs from Analog Devices, Motorola, Microchip, Intel, Atmel, NEC, Hitachi, Texas Instruments etc. It offer services in the following areas: Product Development, Re-Engineering, Firmware Development, Software Development, PCB Design, Verification and Validation.
Offshore outsourcing—
Offshore outsourcing is emerging as a flexible and powerful approach that companies can use to achieve a wide range of tactical and strategic aims. Many organizations are outsourcing their software development, testing, support, technical design, application and data management, thereby enabling them to focus more on understanding customer needs, achieve better product positioning and enhance customer satisfaction.
Recent Developments—
Infotech Enterprises announced that it has signed a Memorandum of Understanding (MoU) with Eurocopter a Germany-based helicopter manufacturing Company, for the attack helicopter program of the ministry of defence, Government of India.
Infotech Enterprises has announced that its subsidiary, Infotech Enterprises Benelux BV, has signed an agreement with the Dutch telecommunications engineering and technology company Volker Wessels Telecom to provide a new service offering in Telecommunications engineering to telecommunications industry world wide. The company specializes in engineering design services (EDS) like mechanical and electronic design, technical publications and engineering software development.
Infotech Enterprises, a global technology solutions provider with headquarters in Hydrabad, India announced that it has inked a 5 year contract with inCONTROL Tech (iTEC) of Malaysia to implement an Enterprise GIS information System for Tenaga National Berhad (TNB) which is the largest Electric Utility in Malaysia. The implementation is a part of TNB’s long term GIS roll out plan for all their circles nationwide. Under this project, Infotech and iTEC would be offering a service oriented architecture (SOA) based solution for enterprise GIS information management to TNB. This implementation would help integrate and streamline business processes across various functions within TNB.
Valuation—
At current market price, Stock trades at attractive valuation of 8.67 multiple of its FY2010 Estimated earnings par share. We recommend investors to buy “Infotech enterprises” with medium to long-term investment horizon.

Source: Internet (By Abhishek Jain)

Stock Idea: Prithvi Information Solutions

Prithvi Information Solutions: Quick turnaround
The mind-boggling Q1FY10 results of Prithvi Information Solutions Ltd. (PISL) (Code: 532675) (Rs.71.05) went unnoticed by marketmen. The company posted a net profit of Rs.17.6 cr. against a net loss of Rs.7 cr. in Q1FY09. PISL is an IT enabled services provider with four segments-technology outsourcing, business intelligence, network solutions and KPO (knowledge process outsourcing). Incorporated in 1998 as Prithvi Information Solutions Pvt. Ltd. in Hyderabad, it was converted into a public limited company in 2000. PISL started its business in 1998 with outsourcing contracts for offshore soft ware development and has over the years evolved into an outsourcing service provider with a number of services. Promoted by Ms. Madhavi Vuppalapati and Mr. Satish Kumar Vuppalapati, it tapped the capital market in July 2005 with an IPO of 50 lakh shares at Rs.270 per share.
PISL is now a global provider of customised solutions and software services to clients in USA. It provides software solutions across a host of technologies and platforms. Its scale of operations is such that it has 6 offices in USA alone, one each in the UK and Singapore, besides two global delivery centres in Hyderabad and one in Bangalore. Other representative offices are in Bahrain - Middle East, Johannesburg - South Africa and Brazil - South America. PISL has domain expertise in various sectors such as Banking, Financial Services & Insurance (BFSI), Technology,
Telecom, Healthcare, Manufacturing and E-governance. Basically, it has three strategic business units – technology outsourcing, process outsourcing and intelligence solutions, jointly addressing a wide spectrum of clients.
Some of its clients are Fortune 500 companies with 15 big ticket clients with over US $10 billion in sales. Its main clients are John Hopkins, T-Mobile, PNC Bank, Pittsburg Medical Insurance, Meckson Pharma and Pittsburg Plate Glass of USA. PISL’s service offerings span the complete software lifecycle including consulting, architecture, development, testing, maintenance, migration, re-engineering and integration services.

For FY09, PISL had posted 42% lower net profit at Rs.36.7 cr. on 78% higher sales of Rs.1976 cr. For Q1FY10, sales went up by 2% to Rs.388 cr. and net profit was Rs.17.6 cr. against a net loss of Rs.7 cr. in Q1FY09. Its equity capital is Rs.18.1 cr. and with reserves of Rs.405 cr., the book value of the share works out to Rs. 234. The promoters hold 32.6% in the equity capital, foreign holding is 9.2%, PCBs hold 15.2% leaving 42.6% with the investing public.
Last year, PISL acquired Effigient, USA for $1.89 million. Effigent’s niche consulting business division is an Apple Professional Services partner that provide consulting services in the areas of Apple and Open Source technologies that address the growing demand for IT services for the Mac OS X platform and related technologies. It also acquired assets of Strategic Research and Development Group (SRDG), USA at US $0.85 million. SRDG provides high-end consulting in business transformation services with IBM as a partner and directly to customers such as Fireman's Fund, AIG and the Citigroup. These strategic acquisition augment PISL’s IT services portfolio and strengthens its competitive position by offering clients the opportunity to seamlessly develop and deploy Mac based applications into their enterprise solutions portfolio. PISL is actively looking for further acquisitions in USA and the Middle East. It has a well-planned strategy to diversify geographical presence by foraying into the high-growth regions of India and the Middle East. PISL has also entered the high-end Knowledge Process Outsourcing (KPO) segment and has a significant presence in the Network Solutions space. With India well-positioned to seize a major chunk of the KPO pie, PISL stands to gain by its diverse offerings and early mover advantage. KPO is expected to be a $17 billion industry by 2010 and India hopes to
garner a whopping 70% share of the global market at $12 billion. KPO encompasses the whole gamut of higher valueadded knowledge services such as investment research, biotech research, engineering research, complex analytics, patent filings, legal outsourcing, etc. PISL was ranked as the 14th largest IT service exporter in India in FY08 by NASSCOM and Deloitte’s Technology Fast 50 India in 2008. Its recent focus to develop network solutions and KPO can reap a rich harvest in the next 2-3 years. Moreover, an increase in its offshore revenues will help realize strong returns. For FY10, net profit is expected to be Rs.55 cr. on sales of Rs.1800 cr., which would give an EPS of Rs.30.4. At the CMP of Rs.71, the share is trading at a P/E of 2.3 on its FY10 estimated EPS of Rs.30.4. The share is recommended with a target price of Rs.120 at which it would trade at a conservative P/E of 4. The 52-week high/low of the share has been Rs.146/30.

Source: Internet (Moneytimes)

Intraday Trading Calls for 27th August

Indian Stock Market may open positive and remains flat to negative but with very high volatility.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
JP ASSOCIATES	Buy Above	222.60	228.20	234.00
	Sell Below	219.35	213.25	208.00
GTL INFRA	Buy Above	39.10	41.25	43.00
	Sell Below	37.50	36.10	34.00
IRB INFRA	Buy Above	208.25	213.75	220.00
	Sell Below	205.15	200.10	195.00
IDFC	Buy Above	131.60	136.20	141.00
	Sell Below	129.20	125.10	121.00
BRFL	Buy Above	192.75	197.70	204.00
	Sell Below	189.50	185.20	180.00
GMR INFRA	Buy Above	143.25	147.25	152.00
	Sell Below	140.35	136.45	132.00
NAGARJUNA CONSTRUCTION	Buy Above	137.60	141.55	147.00
	Sell Below	135.10	131.60	127.00

GOOD LUCK

Intraday Trading Calls for 26th August

Indian Stock Market may open positive and remains positive but with very high volatility.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
JP ASSOCIATES	Buy Above	221.55	227.15	232.00
	Sell Below	218.35	213.25	208.00
ROLTA INDIA	Buy Above	187.25	192.10	198.00
	Sell Below	184.15	180.35	175.00
MOSER BAER	Buy Above	91.75	95.20	98.00
	Sell Below	90.30	87.45	84.00
IDFC	Buy Above	131.60	136.20	141.00
	Sell Below	128.70	125.10	121.00
BRFL	Buy Above	191.60	197.70	204.00
	Sell Below	189.10	185.20	180.00
GMR INFRA	Buy Above	136.25	140.35	145.00
	Sell Below	133.50	130.10	126.00
NAGARJUNA CONSTRUCTION	Buy Above	138.60	142.75	148.00
	Sell Below	135.40	131.60	127.00

GOOD LUCK

Stock Idea: Nitta Gelatin Ltd.

Earlier known as Kerala Chemicals, NGL is 80.50% subsidiary of Nitta Gelatin Inc., Japan, which is one of the largest producers of Gelatin in the world and, brand name 'Nitta' commands premium in the market. NGIL is engaged in the manufacture of Gelatin, Ossein, DCP and Collagen Peptide. NGL is the largest producer of Gelatin in India.

Gelatin: Gelatin for Pharma Use: Gelatin is a vital ingredient in the most popular drug delivery systems in the world, such as hard capsules, soft capsules, tablets, mini, micro capsules etc.

Gelatin for Food: This type of Gelatin is widely used as an ingredient in desserts, confections, frozen foods, ready-to-eat meals and drinks because of its high purity protein and fat-free property, as well as its gelations and water retention properties.

Gelatin for Digital Cameras: Gelatin is popular as the ideal material upon which to reproduce quality images. It has installed capacity of 3500 TPA for Gelatin.

DCP (dicalcium phospate): DCP is consumed by poulty industries and demand for the same is rising. Company has 11,000 TPA capacity for the same.

Ossein: Installed capacity is 5500 tonnes and entire production is exported to Nitta, Japan.

Company has performed extremely well in 2008-09. Sales increased by 25% due to increased production, better unit sales realization and better sales mix. PBT zoomed by 238%. PAT increased by 126% despite significantly higher tax provision. During the year, company provided 6.49 cr. for depreciation and 6.57 cr. for deferred tax. Thus, total Cash Profit stood at 28 crs. Cash EPS Rs. 33.30 and EPS Rs. 17.88. Gelatin production increased by 14% to 3522 MT. Company changed its drying operation from furnace oil to firewood to more areas resulting in substantial savings. Increase in power tariff increased the power cost by 2.40 crs. Exports of Gelatin stood 2064 MT to 19 countries and 1413 MT sold in domestic market. Ossein turnover increased by 20%. Gelatin turnover increased by 30% to 84.06 cr.. DCP sales increased by 21% to 52.31 crs. Company has been performing extremely well in current year. For Q1, sales have gone up by just 5%. However, PBT has climbed by 142%. Despite higher income tax provision, PAT is up 110% to 6.07 crs. Q1 EPS is 7.23.

A) During the year, Company has already increased its Gelatin capacity by 400 MT and work is under progress to increase the capacity by further 500 MT. Company is also taking steps to increase the yield and reduce production costs.

B) Collagen Peptide: In recent years, collagen has been found to physiologically activate the human body. Proper use of enzyme that splits the peptide bonds will enable control of Amino acid sequence involved in digestion of the collagen. NGIL Collagen Peptide helps in maintaining health and well being as it is a functional food for healthy/younger skin, controlling bone mineral density and for Joint Health. Company has already commissioned a Plant with 300 MT capacity. Company plans to increase its production capacity next year.

C) Work in a Plant to manufacture 660 MT of Meat Meal and 360 MT of Sterilized Bone Meal has also been completed. It will utilize the solids that go into effluent and convert to value added products for pet food and poultry feed. Considering above developments and continued rising demand for its products from User Industry, NGIL should report spectacular performance.

Valuations:

A) Book Value is Rs. 105/-.

B) RoE is 17.02%.

C) Gross Block is Rs. 136 crs.

D) Net Block is Rs. 58 crs.

E) Stock is trading at 4.56 x FY10E EPS and 3.67 x FY11 EPS.

Above valuations are quite cheap considering Japanese giant holds 80% stake and Company has world class technology to produce globally famous products. Even if NGIL gets a very modest P.E. Ratio of 9, based upon FY10E EPS, its share price should be Rs. 270/-. In stable market conditions, NGIL scrip should appreciate minimum 30% in next 3-6 months and 70% in 12-15 months. A solid scrip available at compelling valuations.

Stock Idea: Wockhardt

Wockhardt is a stock which analysts have written off, in April 09, as the company is saddled with the debt of Rs.3,400 crores. However, we had a different view, which was expressed by us in our cover feature on 2-04-09, wherein story said, "Wockhardt- not yet on the death bed". Share at that time, was recommended at Rs.75, saying that it has tremendous value and potential to rise.

The faith in the stock was re-affirmed by us in our second cover, on 25-06-09, in the story "Wockhardt – CDR Pill will give it color of health".
Now we are seeing the effect on stock price, which has moved to Rs.180, due to the various developments having taken place in the company, in last 4 months. To tide over its liquidity crunch, the company has divested its animal health care and nutritional business for over Rs.750 crores and the promoters of the company, today, divested its ownership of 10 hospitals of Wockhardt Hospitals for Rs.909 crores, to Fortis Healthcare. These 10 hospitals are located in Mumbai 2, Kolkata 3 and Bangalore 5, including 2 under construction, having 1902 beds, including 534 beds in 2 Greenfield projects. This includes two JCI accredited hospitals situated at Mulund in Mumbai and Banerghatta Road, Bengaluru.
Wockhardt Hospitals had a total debt of Rs.436 crores, as at 31-12-07, which has learnt to have risen to Rs.500 crores, as on date. So of this sale proceeds, almost entire debt is likely to get paid and discharged, while remaining amount is likely to get used by the promoters to deleverage the balance sheet of Wockhardt.
Paid up equity of Wockhardt Hospital is at Rs. 104.28 crores, with face value of Rs. 10 each. 81.79 % of this is held by Dartmour Holdings Pvt. Ltd., in which Mr. H. F. Khorikawala, holds 97.56 %, while 2.44 % is held by his wife Mrs. Nafisa Khorakiwala. Carol Info Services Ltd., another listed company of the group, holds 9.09 %, while Mr. H. F. Khorakiwala holds another 9.09 % in his personal Capacity.
Earlier, in April 09, many leading print media reported that part of the stake in Wockhardt Hospital is held by Wockhardt, which had leveraged balance sheet of Wockhardt and derailed it. This was clearly stated by us in our 2^nd April 09 article that it is not so.
Since CDR of Wockhardt has been approved along with that of Wockhardt Hospitals, and in view of group likely to mobilize close to over Rs.1,600 crores, in both the companies, debt burden would get eased to the extent of 50 % and debt equity ratio of both the companies would come within the accepted norms.
The pressing liability before Wockhardt has been FCCB of $ 110 million, which is falling due for redemption on 25-09-09, with liability of $ 142.54 million. Since these FCCB are ruling at a hefty discount, the same can now be bought back by the promoters, on which saving of close to Rs. 350 crores is likely to be made, with equal amount requiring to buy them back.
See how the company gets transformed in no time? Where existence of a company itself having come in question, now it may have surplus funds with the promoters and the company. Wockhardt Hospitals is seen to be completing the deal by December 09, for which business transfer agreement has been signed with Fortis Healthcare. On receipt of Rs.909 crores and after fully paying off its debt of close to Rs.500 crores, the company will be left with about Rs.400 crores, which will be considered as the promoters' money.
However, in view of the promoters, having a stake of 74.08 % in Wockhardt, it will be difficult for them to raise it beyond 75 %, inspite of they willing to do so, on fear of open offer getting triggered. But, this surplus money is likely to get utilized to bring Wockhardt on its own feet and let him bring back its own glory.
As such, core business of Wockhardt has been intact and it continues to remain 7^th largest pharma company in the country. Share having moved to Rs. 177, still has potential to move to Rs. 250 by the year end, with this drastic transformation.
Source: www.premiuminvestments.in (By S P Tulsian)

Intraday Trading Calls for 25th August

Indian Stock Market may open positive and remains positive but with very high volatility.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
PUNJ LLYOD	Buy Above	256.25	261.55	267.00
	Sell Below	253.15	248.20	242.00
CAIRN INDIA	Buy Above	258.60	264.10	269.00
	Sell Below	255.40	251.15	246.00
CRANES SOFT (512093)	Buy Above	44.25	47.10	50.00
	Sell Below	42.50	40.10	37.00
IDFC	Buy Above	134.75	139.20	144.00
	Sell Below	132.70	128.40	124.00
BRFL	Buy Above	192.65	197.70	204.00
	Sell Below	189.50	185.20	180.00
IDBI	Buy Above	98.70	102.40	106.00
	Sell Below	97.40	95.10	92.00
NAGARJUNA CONSTRUCTION	Buy Above	143.55	148.25	154.00
	Sell Below	140.50	136.45	131.00

Keep an eye on SE Investments (532900) CMP Rs. 206/- for intraday trading.

GOOD LUCK