Intraday Trading Calls for 14th May

Indian Stock Market may open negative but buying expected at lower levels and a good positive closing expected..
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
REL POWER	Buy Above	147.20	151.35	155.00
	Sell Below	144.30	141.45	138.00
NAGARJUN CONSTRUCT.	Buy Above	168.70	174.10	180.00
	Sell Below	165.30	160.55	156.00
GODREJ INDUSTRIES	Buy Above	157.25	162.35	168.00
	Sell Below	154.55	150.10	146.00
VIDEOCON INDUSTRIES	Buy Above	218.60	224.75	232.00
	Sell Below	215.00	209.30	204.00
ATLANTA	Buy Above	298.25	304.75	312.00
	Sell Below	293.35	287.10	280.00
ESCORTS	Buy Above	196.10	201.55	207.00
	Sell Below	193.40	188.50	183.00
INDIABULLS REALEST	Buy Above	169.60	174.65	180.00
	Sell Below	166.45	162.15	158.00

GOOD LUCK

Stock Idea: Anik Industries

Anik Industries is a part of Ruchi Soya Group. This company manufactures Anik brand of ghee and dairy whitener. The company has got primarily two business segments. One is the dairy business and the second is the trading business. Besides that the company also has a small wind power generation capacity, which accounts for marginal revenues for the company. In dairy business, this company has got infrastructure facilities at Uttar Pradesh (UP) and Madhya Pradesh (MP). Besides that company also has infrastructure of chilling units spread across these two states. The company is putting up a new plant, which will process about 4 lakh litres of milk every day and produce 30 tonne of milk powder.

Anik as a brand, whether it is ghee or skimmed milk powder, it is an established brand in the Indian market with a good brand recall. The company also derives revenues from trading of agricultural and non-agricultural commodities.

If you look at the financials of the company FY09 sales were close to Rs 1000 crore, profit after tax was about Rs 11 crore and for the first nine months sales are up by about 25% and profit after tax is down by about 12% to about Rs 10 crore.

If you look at the positives and negatives of the company—the company has got good brand recall. The potential for growth in this business is immense. Another important thing that has happened in the international markets is that Chicago Mercantile Exchange has recently allowed derivative trading in skimmed milk powder. Now that essentially is going to do is that there is going to be a speculative interest also in skimmed milk powder. This may lead to the prices of the skimmed milk powder going up in the international markets, which will be a big benefit to companies involved in the manufacture of skimmed milk powder especially Anik Industries. It has got a large capacity for the manufacture of skimmed milk powder.

On the lower side the concerns for the company are that the operating margins of the company are very small. The performance of the company is largely depended upon its ability to procure so much amount of milk at competitive prices. But given the capabilities of the promoter and the fact that the price is attractive the stock currently trades at about Rs 60 and market cap of about Rs 150-160 crore.

For a company with established brand doing a turnover close to Rs 1200 crore the valuation of the company looks very attractive. Skimmed milk powder prices if they go up can really lead to margin improvement for the company. I think from these levels downside the stock looks restricted and the potential upside could be good.

Source: Internet (moneycontrol.com by Ashish Chug)

Stock Idea: Siyaram Silk Mills

Siyaram Silk Mills is a part of Siyaram Poddar group. This is a vertically integrated textile company. This company has got in-house facilities for spinning, dyeing, weaving, finishing and also garmenting. The brand Siyaram is available at over 40,000 retail outlets all across the country. Besides that the company is also opening its own exclusive stores where it will sell Siyaram besides other brands, which the company has. Beside Siyaram the company also has Oxemberg and J Hamstead as the other brands under which their garments are sold.

If you see the financials of the company, for FY09, the company did sales of about Rs 530 crore, profit after tax (PAT) was about Rs 11.5 crore. In the first nine months, sales are up by about 25% about Rs 472 crore. Profit after tax is up by more than 150% to about Rs 18.5 crore, which means an annualized EPS of Rs 25. The stock currently trading at about Rs 170-172 is available at a PE multiple of less than 7 and a market cap of about Rs 160 crore.

If you look at the valuation of the company—you have a company, which is doing sales of close to Rs 600-650 crore that too in the branded segment available at a market cap of about Rs 160 crore and a PE of less than 7

The company has got a 20 year track record of uninterrupted dividends. Even for 2010 the company has already given an interim dividend of about 60%. The book value is about Rs 175 which means bonus is definitely a possibility. The best part is that past few years there has been no equity dilution by the company except for the bonus, which the company gave in 2006 and a small preferential issue, which was made to the promoter’s way back in 2001. Besides that there has not been any equity dilution and the equity is very small at about Rs 9.5 crore.

Given all those factors, the price to earning multiple of 7 is the company is currently discounting the PE multiple of a commodity textile play and not really of value added company with good brands. The stock is bound to get re-rated. I think it is a matter of time that the stock gets re-rated.

Source: Internet (moneycontrol.com by Ashish Chug)