Stock Idea: Allcargo

Looking at the financial performance of AllCargo, it would be difficult to imagine that the world is going through a slowdown. A company which moves goods is the first to feel the pinch but there seems to be no stopping this company.

Defying all logic, the company, for the third quarter ended 30th September 2008, on a YoY posted a 56% rise in consolidated net sales. Though operating expenses went up by 51%, its EBIDTA was up a whopping 153%. Net profit for the period was up by an unbelievable 145% at Rs.42.05 crore. The consolidated results includes financial results of the direct / indirect subsidiaries, viz: Allcargo Belgium N.V., Hindustan Cargo Ltd and Contech Transport Services Pvt. Ltd. The performance of the company also includes that of Project and equipment division of Transindia Freight Services, which was merged with company in this fiscal. The merger of this company to a large extent has been responsible for the phenomenal performance.

Multimodal Transport Operation (MTO) segment registered significant growth of 60% and this was mainly on account of the Project division. The Container Freight Station (CFS)& Inland Container Depots (ICD) revenue has increased by 90%. The equipment hiring unit was a new contributor and it added Rs.10.31 crore to the topline.

Allcargo now has a fleet of 333 trailers, 51 forklifts, 53 cranes and 18 Reach stackers. The company has stated that it is adequately funded and does not expect to feel any impact of the slowdown. Being diversified, with operations globally and in India, the company is better equipped to sail through this global meltdown. Infact it is taking this opportunity of the slowdown to scout around for acquisitons overseas and plans to finalise them if the pricing is good.
Currently at Rs.404 levels, it has bounced back sharply from the low of Rs.272. Buy if it goes below Rs.300 for long term.

Source: sptulsian.com

Stock Idea: BHEL

The effect of the slowdown cannot be seen in this PSU capital goods company. Infact it seems to be business as usual, with orders burgeoning as has always been the trend.

For the first half ended 30th September 2008, BHEL posted a 31% rise in net sales on a YoY. The value of production (net of excise duty) has also improved by 34.07%. Other operating income was at Rs.599 crore which included one time interest income of Rs.267 crore on IT refund of earlier years. PAT was at Rs.1000.20 crore as against Rs.976.60 crore (Rs.847.60 crore excluding interest on IT refund) in Q2FY08.

Orders worth Rs.14,350 crore were received during the current Q2 and order outstanding currently is at about Rs.1,04,000 crore. So the company continues to have the issues of a huge backlog and unless the expanded facility or new facility does come up soon, this burgeoning issue of order backlog will continue to dog the company.

Wage revision is also a big issue, infact the biggest bane of PSUs. For BHEL, the provision for wage revision was reassessed in the current year at Rs.1907 crore for the period from 01.01.07 to 31.03.09. Amount already provided upto 31.03.08 was Rs.594 crore. Balance Rs.1313 crore is being provided in the year 08-09. In the first 2 quarters of 08-09, Rs.547 crore has been provided. This wage revision is about 5% of the market share of the turnover and will continue to remain so for the next 2- 3 years, denting the margins.

The stock price has recovered strongly from the low of Rs.984. Stay invested and if it touches the same low levels again, best time to pick up the stock then.

Source: sptulsian.com

Intraday Trading Calls for 07th November

Indian Stock Market may open Nagetive but Sharp recovery expected from lower levels and good Positive closing expected today.

Today's Intraday Trading Calls / Stock Tips (Keep Appropriate Stop Loss for each trade):

HDIL (117)

Buy Above 118.60 Target 124.35, 130.00

Sell Below 115.50 Target 112.20, 108.00

INDIABULLS REALEST (155)

Buy Above 156.20 Target 160.10, 165.00

Sell Below 153.40 Target 149.25, 145.00

JP ASSOCIATES (84)

Buy Above 84.80 Target 87.75, 92.00

Sell Below 82.45 Target 78.30, 74.00

HPCL (201)

Buy Above 203.20 Target 208.55, 215.00

Sell Below 198.40 Target 194.35, 190.00

PUNJ LLYOD (199)

Buy Above 200.75 Target 207.65, 215.00

Sell Below 197.40 Target 193.20, 188.00

RPL (83)

Buy Above 84.20 Target 87.45, 92.00

Sell Below 82.10 Target 79.10, 75.00

Others for Intraday: BPCL, IOC, GAIL INDIA, ONGC.

Penny Stock Tip: Kaashyap Technologies 532283 (0.67) Target Rs. 4-5/-

GOOD LUCK.

Multibagger: Sarda Energy & Minerals Ltd

Multi Bagger: Sarda Energy & Minerals Ltd Recommended Price Rs 60.35
By Ashish Chugh, Investment Advisor Report Dated: Nov 04, 2008

Sarda Energy & Minerals Ltd.Sarda Energy & Minerals Ltd., formed through the merger of Raipur Alloys & Steel Ltd. And Chhattisgarh Electricity Company Ltd. Is a fully ntergrated steel manufacturer. The company has a captive Iron Ore, Manganese Mines and Coal Sources. The company also has a captive power plant which provides it a clear competitive advantage enabling the company to produce at most competitive costs. The company is a manufacturer of Sponge Iron, Ferro Alloys and Rolled products. We expect to benefit from this edge in 2008-09 and beyond. The company’s has a 250-hectare plant located in Raipur with a dedicated 8-km water pipeline from the Kharoon river to the plant for uninterrupted water supply.Self Sufficiency in Critical Inputs:The company is 100% self sufficient in its energy needs, which is the most critical input in ferro alloys and steelmaking.The company has a 48MW Power plant sufficient to meet ts own power requirements.The company’s operational Iron Ore mine has reserves of nearly 20 million MT. In addition, the Company has got an in-principle approval from the Government of India for five more mines possessing sufficient reserves to meet its requirement for the next 25 years. The Company secured coal reserves of more than 100 million MT. The first mine with reserves of 67 million MT has been commissioned. As regard Manganese Ore, the company acquired mining rights from private parties in Goa. In addition, reconnaissance permits/ in-principle approvals were granted in favour of the Company for three mines in Madhya Pradesh.Low Cost Producer:The company is a low cost producer on account of its vertical integration, economies of scale and reduced dependence on the external market for supply of critical inputs. The Company had foreseen the need to secure raw material resources more than a decade ago and had taken adequate steps in that direction. The company today is completely integrated from iron ore to finished steel for end users. The availability of captive resources within a radius of 250 km from its manufacturing facility significantly saves logistic costs.

In the quarter July-Sep 08, the company total income is up to over 150% to Rs 348 crores, PBT and PAT have roughly doubled to Rs 58.12 crores and Rs 46.64 crores respectively over the same period last year. The EPS on TTM basis comes to over Rs 55. The stock thus trades at a PE multiple of just over 1.

Conclusion: Sarda Energy may be better placed than many other steel manufacturers to compete in a difficult environment on account of its raw material linkages. Even though steel prices are on a decline, we believe the drop in the stock price of Sarda Energy from a High of Rs 695 to the current price of Rs 60 is largely overdone. Investors may choose to buy the stock for a 50-100% gain over the next few months. However, a close watch needs to maintained on Steel Cycle and any indications of the prices stabilizing/ inching upwards after the fall witnessed recently may lead to upward rerating of the stock. The short term downside from the current levels looks negligible.

Intraday Trading Calls for 05th November

Indian Stock Market may open positive but profit booking expected at higher levels so remains very volatile throughout the day today. A positive closing expected today also.

Today's Intraday Trading Calls / Stock Tips (Keep Appropriate Stop Loss for each trade):

HDIL (144)
Buy Above 145.60 Target 149.35, 155.00
Sell Below 142.70 Target 138.50, 132.00
CAIRN INDIA (144)
Buy Above 145.80 Target 150.00, 155.00
Sell Below 142.40 Target 138.25, 132.00
KS OILS (42)
Buy Above 43.20 Target 45.75, 48.00
Sell Below 41.20 Target 39.20, 36.00
BARTRONICS INDIA (92)
Buy Above 93.80 Target 98.55, 105.00
Sell Below 90.50 Target 87.05, 82.00
PUNJ LLYOD (204)
Buy Above 206.65 Target 212.55, 220.00
Sell Below 201.40 Target 196.40, 190.00
RPL (94)
Buy Above 95.20 Target 98.40, 102.00
Sell Below 92.70 Target 90.10, 86.00

Multibaggers: Andhra Petro (500012), Adhunik Metalik (532727), Prithvi Info (532675), GTC (500151), Ansal Buildwell (523007).

GOOD LUCK.

Intraday Trading Calls for 04th November.

Indian Stock Market may open flat to positive but profit booking expected at higher levels so remains very volatile throughout the day today.

Today's Intraday Trading Calls / Stock Tips (Keep Appropriate Stop Loss for each trade):
HDIL (138)
Buy Above 139.80 Target 144.35, 150.00
Sell Below 136.70 Target 133.40, 128.00
HPCL (208)
Buy Above 210.60 Target 216.75, 225.00
Sell Below 205.40 Target 200.10, 194.00
HUL (238)
Buy Above 240.40 Target 244.60, 250.00
Sell Below 236.20 Target 232.70, 227.00
CIPLA (175)
Buy Above 176.75 Target 180.25, 185.00
Sell Below 173.50 Target 170.05, 166.00
JSW STEEL (312)
Buy Above 315.80 Target 322.45, 330.00
Sell Below 309.40 Target 302.40, 294.00
BANK OF INDIA (247)
Buy Above 249.60 Target 255.75, 264.00
Sell Below 244.50 Target 240.10, 235.00

Multibaggers: RPIL (526407) Adhunik Metalik (532727), Prithvi Info (532675), GTC (500151), Ansal Buildwell (523007).

GOOD LUCK.

Stock Idea: KS Oils Ltd.

K S Oils Ltd. (KSOL) is a 23-year old Morena (Madhya Pradesh) based company established in 1985. It is a leading integrated edible oil manufacturing company with its product range constituting mustard and soya bean oils. The company has five manufacturing plants with marketing offices and plantations in India, Malaysia, Indonesia and Singapore. Its business can be broadly classified into five divisions viz. Oil, Refinery, Vanaspati, Solvent and Power. Mr. Ramesh Chand Garg is the chairman while Mr. Sanjay Agarwal is the managing director of the company. KSOL has renowned brands like Kalash, Double Sher and K. S. Gold, which comprise a range of healthy cooking oil brands in mustard, refined oil and vanaspati. All its manufacturing plants are located in the rich mustard growing belt of Madhya Pradesh and Rajasthan in India.
Beginning operations in 1989 the company ventured into mustard oil with an oil mill having a crushing capacity of 150 tonnes per day (TPD). In 1992-93, it undertook its first major expansion with a building and commissioning its Solvent Extraction Unit (SEU). In 1995, it expanded its refinery operations as a development module. During 2001, a vanaspati unit of the company with a capacity of 150 TPD production was set up and also commissioned in the same year. To improve its packaging system, a High Density Polythylene Jar manufacturing unit was started in 2002. In 2006, the company acquired oil mills on lease with production capacities of 225 TPD. Further, it has received in-principle approval for allotment of 2000 hectares of waste land in Morena District from the Government of Madhya Pradesh for cultivation of Jatropha for the production of Bio-diesel. During 2007, it acquired an edible oil plant at Jodhpur, Rajasthan and made a strategic tie-up with a plant in Alwar, Rajasthan, to enhance production. KSOL ventured in the power sector by commissioning wind turbines of 2.5 MW. Also it added 28 windmills with capacity of 24 MWs in 2008. The company’s journey as a global player began in 2008 when it became the first Indian company to acquire palm plantations abroad. Its plantation in Indonesia occupies 50,000 acres (20,000 ha) is estimated to supply 80,000 tonnes of oil to its manufacturing and refining plants in India.

KSOL, today, is a leading supplier of edible oils to the Indian defence forces and this tradition has been maintained for the past few years. The company has made concerted efforts to move up from a mustard oil producing company to a market focused FMCG brand company. The opportunity in the Indian markets is huge. Statistics reveal that the 6 northern states consume 90% of the mustard oil produced in the country, which throws up a market opportunity of over 50 crore customers.
Performance: The company has been posting consistently improved results quarter after quarter. During FY08, it clocked a net sales income of Rs.2044.30 cr. with a net profit of Rs.120.70 cr. posting an EPS of Rs.4.48 per share with a face value of Re.1.
Financial Highlights: (Rs. in lakh) Latest Results: In tune with its earlier performances, the company has reported encouraging Q2FY09 results registering a net sales income of Rs.733.60 cr. with net profit of Rs.42.22 cr. recording a basic EPS of Rs.1.27 and a diluted EPS of Rs.1.25. The annualised basic EPS works out to Rs.5.08 and diluted EPS of Rs.5 (FV: Re.1).
Share Profile: The shares of KSOL are listed and traded on the BSE under the B group. Its share touched a 52-week high/low of Rs.142/38. At its current market price of Rs.38.90, it has a market capitalisation of Rs.1333 cr. Dividends: The company has been paying dividends as shown below: FY08 - 18%, FY07 - 15%, FY06 - 12%, FY05 - 10%.
Shareholding Pattern: The promoter holding in the company is 33.31% while the balance 66.69% is held by non-corporate promoters, institutions, others and the Indian public. Among mutual funds, Kotak has added the company’s shares to its various schemes.
Prospects: Today, India accounts for 7% of the global oilseeds and oil meal production and 10% of the global consumption of edible oil. With the edible oil market size placed at Rs.67,500 cr. and the branded segment commanding 15% market share, the market opportunity is huge. Also, with modern retail formats limited to just 3%, the penetration opportunity is mind boggling. Lastly, with the improvement in the lifestyle of the Indian consumer, healthy living will be a priority, which will create an immense opportunity for the edible oil sector. The latest report from FICCI suggests that the branded edible oils market is 5 expected to grow by 20% per annum, which will not only spur the demand for edible oils but will also drive the demand towards branded and organised edible oil players. India is also witnessing an increase in lifestyle diseases like heart ailments and cardio vascular illness, which is said to be much higher than other nations. This calls for healthy edible oil and mustard being among the world's most heart friendly oil, consumers will be eager to adapt to qualitative mustard oil brands.
Conclusion: KSOIL is one of the top five edible oil companies in India. Moreover, with its global foray, changing lifestyles and health consciousness among the vast middle class is expected to have a beneficial impact on the company. At its current market price of Rs.39, its share price is discounted less than 8 times its estimated earnings. It is worth mentioning that the company has been able to post much better results in the present economic downtrend. Moreover, with the shortage of food expected worldwide, the prospects for companies like KSOL is extremely good. This share may be picked up in small parcels. The share offers a good investment opportunity to discerning investors with a medium-to long- term outlook.

Source: Internet (moneytimes)