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)

Intraday Trading Calls for 12th 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	145.20	149.55	154.00
	Sell Below	143.30	139.25	135.00
CHOLADBS FINANCE	Buy Above	132.75	138.10	144.00
	Sell Below	130.10	125.15	120.00
GODREJ INDUSTRIES	Buy Above	150.25	155.65	161.00
	Sell Below	148.35	144.10	140.00
VIDEOCON INDUSTRIES	Buy Above	218.20	224.75	232.00
	Sell Below	214.70	209.30	204.00
ATLANTA	Buy Above	292.75	301.20	310.00
	Sell Below	287.35	280.00	272.00
ESCORTS	Buy Above	184.65	190.05	195.00
	Sell Below	182.05	177.50	172.00
INDIABULLS REALEST	Buy Above	160.00	165.25	171.00
	Sell Below	157.35	152.15	148.00

SHORT TO MEDIUM TERM DELIVERY PICK:

BUY NAKODA LTD. (521030) CMP Rs. 13.73/- SHORT TO MED TERM TARGET Rs. 20 - 28/-.
GOOD LUCK

Intraday Trading Calls for 06th May

Indian Stock Market may open negative but buying expected at lower levels and a 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
SUJANA TOWER	Buy Above	54.50	57.05	60.00
	Sell Below	52.70	50.25	48.00
APTECH LTD.	Buy Above	158.65	165.10	170.00
	Sell Below	155.40	150.15	145.00
GODREJ INDUSTRIES	Buy Above	161.60	166.25	172.00
	Sell Below	159.45	154.10	150.00
CAIRN INDIA	Buy Above	301.55	306.75	312.00
	Sell Below	306.70	302.20	298.00
ATLANTA	Buy Above	272.65	278.20	285.00
	Sell Below	268.35	262.30	255.00
REL POWER	Buy Above	154.55	158.35	162.00
	Sell Below	152.45	149.20	146.00
INDIABULLS REALEST	Buy Above	165.20	171.55	178.00
	Sell Below	162.35	157.15	152.00

GOOD LUCK

Intraday Trading Calls for 05th May

Indian Stock Market may open negative and remains very volatile for the day today.
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
SUJANA TOWER	Buy Above	55.00	57.55	60.00
	Sell Below	53.75	51.25	49.00
SASKEN COMM.	Buy Above	210.20	216.50	222.00
	Sell Below	206.40	201.50	196.00
GODREJ INDUSTRIES	Buy Above	161.20	165.75	171.00
	Sell Below	158.45	154.10	150.00
CAIRN INDIA	Buy Above	310.00	314.65	320.00
	Sell Below	306.70	302.20	298.00
ATLANTA	Buy Above	272.65	278.20	285.00
	Sell Below	268.35	262.30	255.00
REL POWER	Buy Above	157.25	161.35	165.00
	Sell Below	155.35	152.20	148.00
INDIABULLS REALEST	Buy Above	166.50	172.25	178.00
	Sell Below	163.35	158.15	154.00

GOOD LUCK

Intraday Trading Calls for 03rd May

Indian Stock Market may open positive and remains good for the day today.
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
SUJANA TOWER	Buy Above	52.25	55.05	58.00
	Sell Below	50.70	48.25	46.00
SASKEN COMM.	Buy Above	220.75	226.50	232.00
	Sell Below	208.30	202.70	198.00
GODREJ INDUSTRIES	Buy Above	167.25	172.10	178.00
	Sell Below	165.30	161.10	157.00
PURVANKARA	Buy Above	112.25	117.55	122.00
	Sell Below	109.40	105.20	100.00
INDOWIND ENERGY.	Buy Above	54.50	57.20	60.00
	Sell Below	53.35	51.20	49.00
REL POWER	Buy Above	163.70	167.55	171.00
	Sell Below	161.55	158.20	155.00
INDIABULLS REALEST	Buy Above	171.25	176.75	182.00
	Sell Below	169.05	165.15	160.00

GOOD LUCK

Stock Idea: Provogue India Ltd.

Provogue India Ltd (Rs 50) (Rs 2 paid up)

(BSE Code- 532647 NSE Code- PROVOGUE)

(P/E- 10, FY09 Sales - Rs363 cr, Market Cap - Rs575 cr)

Provogue India Ltd (PIL) operates in two core segments: designing, manufacturing and selling of branded ready-made garments and accessories under the brand, Provogue, which has been positioned as a fashion label in the Indian domestic market. A major portion of the apparels is manufactured at an in-house plant at Daman (Union Territory), with the remaining garments and accessories outsourced. Distribution is managed through a mix of owned branded stores and a network of national chains and single owner multi-brand outlets (MBOs). Exporting is the second business (acquired from a group company on 1 April 2004). Provogue is registered as an ‘export house’ by the government of India. The company exports finished fabrics, dyestuffs, chemicals and textile machinery to several markets in the African continent. All these products are outsourced from various suppliers. Provogue came out with an IPO at Rs 150 per share(Rs 10 paid up) in mid June 2005 to finance the expansion of the company's retail stores and its garment manufacturing and design capabilities.

Provogue has emerged as a leading fashion brand in the Indian ready to wear (RTW) markets, within a relatively short span of seven years since its launch in 1998. It commands a very high brand recall among customers, made possible due to its aggressive marketing strategies, innovative merchandise and famous brand ambassadors. Provogue made a net profit of Rs 59 cr. on revenues of Rs 363 cr. in FY09 on consolidated basis. On a equity of 22.96 cr.,(Promoters’ stake- 42.08%) the EPS on a Rs 2 paid up share stood at Rs 5 and the dividend declared was 30%.. For the nine months ended December, 2009, Provogue has posted net profit of Rs 24.55 cr.(up 16.5%) on net sales of Rs 310 cr.(up 15%) on standalone basis.

After a year of slow growth, apparel maker and retailer Provogue is reworking its business strategy to boost revenues and prop up margins. After the consolidation in the last two years, the company is ready to grow aggressively. Under the new strategy, Provogue plans to reduce the size of its stores, sell more of its vendor brands, slow expansion in its discount format, and scale down mall development. It is confident that this strategic shift, along with the perking up of the economy, will ensure a topline growth of 25-30% every year going forward. Provogue, which opened its first store in 2001, today has 126 stores and over 100 shop-in-shops. The company plans to open 50 new stores in the next two years with an investment of Rs 35 cr. to take its store count to 175. Prozone Liberty, the mall development arm of Provogue, has also scaled down its plans given the slowdown in the retail sector earlier. Originally, the company planned to build six malls, now it is going ahead with only three, in Jaipur, Indore and Aurangabad. The company is also exploring ways to use additional land in these sites for alternative uses such as residential development.

Provogue India is also in talks with FMCG companies to form a joint venture to distribute its bodycare products across the country. Currently, Provogue sells hair gel, body spray and other accessories under its own brand name in its stores and select outlets of Shoppers Stop’s department stores. The distribution JV is expected to help it gain better market share and expected to give Rs 50 cr. in revenues in the next couple of years. The company is planning to float a separate company in West Asia and is in talks with companies in the region to start retailing operations there and the company expects to sign a JV by the middle of next year and open stores by financial year 2011. Provogue is also planning to re-brand its discount format, Promart, into a value brand and a more youth-oriented concept. In view of the above developments and improving growth prospects, Investors can start accumulating the stock at current levels and add more on declines for decent returns of 40%-45% over the next 6-8 months.

Source: Internet (Valuenotes by Sanjay Chhabria)