TRADING CALL FOR SEPT EXPIRY

BUY BANK OF INDIA 300 SEPT CALL @ 2.25/- TARGET 10-12-16-20 STOP LOSS 1

BOI CHART

Investment Idea: EON Electric

Ashish Chugh, Investment Analyst & Author of Hidden Gems shares his view Eon Electric . Chugh told CNBC-TV18, "In this kind of a market you have companies which are trading well below their cash values and Eon Electrics is one of them. This company had the 3 business divisions. This company sold the switchgear division to Legrand of France about a year back and realized an amount of Rs 400 crore from that sale." He further added, "Now after the deal was announced the stock price has fallen by about 75% from about Rs 150 which it touched after the deal got announced and currently trades at close to Rs 38-40. This is primarily on account of the fact that even though this company got realization of more than Rs 200 net of tax per share, the shareholders got just about Rs 10 as dividend." "Now you have one set of companies where there has been a massive increase in shareholders valuation, company like Andhra Paper where the promoters have chosen to sell the company as against selling a business and all the minority shareholders have been benefited by way of the open offer made by the acquirer. On the other hand you have another set of companies where the promoters have chosen to sell a part of their business even though that business was contributing 85-90% of the revenues. Companies like Zicom, GC Venture, Laffans Petro, Smartlink, where the shareholders value has been badly eroded primarily on account of the fact that there is a concern whether the money which has come from the sale will actually flow to the benefit of the shareholders. Eon Electric is no exception." "Eon Electric has got cash and cash equivalents of roughly Rs 300 crore. Company is totally debt free and after the sale of switchgear division, this company is left with cable and lighting business. The gross block is about Rs 58 crore where the market cap of this company is just about Rs 70 crore at the current price and leave aside the residual businesses and the assets which are left, this company has got cash – the market cap is just about less than 25% of the cash it is holding." "I think with these kinds of valuations the investors have probably got reconciled to the fact that this cash, which has come in, may not really flow towards a benefit of the minority shareholders. There is definitely a concern that this cash may not be put to good use but I think at the current market price those concerns have probably got fully factored in on the price." "Any steps now by the management which changes a perception and gives a feeling to the minority shareholders that this money may actually be utilized for value creation and for benefit of all shareholders and not just the promoter, shareholder group or may be if the promoters decide to give more dividend to the shareholders, I think those things may lead to a rerating in the stock price. Whether that happens or not I think only time will tell and that is anybody’s guess at that point of time. I believe the negatives are probably priced in at the current market price of the stock."

Source: Internet (By Ashish Chugh)

Scrips to Watch: ICSA INDIA, Titan Industries, Tata Power

ICSA India (Rs. 65.00) (Code : 531524) :- Technology solutions provider in the power sector ICSA India today said it has bagged three orders totalling Rs 464.17 crore from different entities for infrastructure-related works. The company has received an order worth Rs 254.21 crore from the Bihar State Electricity Board for supplying and installing rural electricity infrastructure and household electrification. The second order valued at Rs 170.17 crore was secured from Mahavitaran (Maharashtra State Electricity Distribution) for constructing and distributing transformers in the Nagpur zone. Besides, it has secured a Rs 39.79-crore order from MP Poorv Kshetra Vidyut Vitaran Co for installation of transformer sub-stations. Hyderabad-based ICSA India is in the business of construction of power transmission lines and substations. Its main area of focus is to provide technology to power companies for Transmission and Distribution(T & D) losses. It also provides products and solutions in the field of energy management, energy audit, control applications etc. It is a growth company which can give you handsome return in next one to two years. Accumulate at every decline in the next phase of correction.
Titan Industries (Rs. 726.00) (Code : 500114) :- Is among the few retailers to have managed strong growth in the ongoing slowdown. A presence across price points in both its key businesses —watches and jewellery — and an extensive network spanning 461 outlets, ensure that the company can capitalise on most areas of consumer spending, premium or mass Market, urban or semi-urban. Titan’s precision engineering business broke even in the December quarter, though eyewear business Eye+ is yet to achieve that. The business has good potential given the robust expansion — 30 stores in the last quarter alone — and the high margins possible in eyewear. In December quarter, its net profit declined a bit, but gross profit margins of jewellery actually improved 2.5 percentage points to 6.4 per cent. Titan Industries has the highest return on capital employed in this segment. At CMP of Rs. 721, the stock trades at 15 times its trailing earnings. It is attractive for such a growth company. Buy at every decline.
Tata Power Company (Rs. 666.00) (Code : 500400) : There were reports that Tata Power Ltd. may sell a part of its stake in a 4,000-megawatt (MW) ultra mega power project (UMPP) that it is building at Mundra to fund capacity addition of 5,660 MW. The company may also sell a part of its 74% stake in the 1,050 MW Maithon power project, which it is building in joint venture with Damodar Valley Corporation, says a financial newspaper. The company is considering its options and has not taken a decision. However it denied the rumors which say that the company was trying to sell its stake in two Indonesian coal mines owned by PT Bumi Resources. The company is committed to complete this project as per schedule and it has indicated that finance will not be a constraint. There is good value in this Tata group company. Invest.

Source : Internet (SmartInvestment)

Investment Picks

Bombay Dyeing (Rs.122.00) (Code: 500020) :- The leading company from textile sector has also entered in to segment of real estate. The company owns lands at posh and prime locations of Mumbai like Worli and Dadar, the two suburbs of the city. Company has market capital of Rs. 443. crores. 52 weeks high and low price of the scrip is Rs. 1065 and Rs. 110. Business of real estate is prime business in Mumbai. After mitigation of effects of recessionary forces Realty market of Mumbai would be first to reap advantage of the change is likely to provide maximum benefit to the company. Rise in the crude price had adversely affected the company, but crude price has come down drastically during last 6 to 8 months. Investors are recommended to invest in the scrip at current market.

Zen Technologies (Rs. 89.00) (Code: 590032) :-The Hyderabad based company was established in 1993 and is active in the business of training stimulators designing, developing and manufacturing. Stimulators include driving and weaponry. During Q3 of current FY company has earned net profit of Rs. 4.73 crores on gross sale of Rs. 13.05 crores, which resulted in to EPS of Rs. 5.71 for the company. Company has current market capital of Rs. 71.94 crores. Company has order book of Rs. 64.29 crores on hand at the end of Q3 of current FY. Considering the planning of the company for new products and increase in manufacturing capacity and marketing investors may include the scrip in their portfolio.

NTPC (Rs.170.00) (Code: 532555) :-National Thermal Power Corporation, the biggest power producing company of the country was established in 1975. The company has also created a position at world level as a one of the biggest power producing company. It has bagged 41st rank amongst 2000 biggest company of the world. Company produces total 19.1 per cent of power from the gross production in the country. During FY 2007-08 its share was 28.50 per cent in gross production of power in country. Considering the huge base and capacity of the company GOI has termed the company as a one of the Navratna company of the country. Company has earned net profit of Rs. 7423 crores form gross sale of Rs. 37091 crores. During last quarter of the FY the company has earned net profit of Rs. 1726.5 crores from the gross sale of Rs. 9539.5 crores. Company has given 35 per cent dividend to its share holders. Invest on the counter at current market price with target price of Rs. 198 to 200.
Opto Circuit (Rs.79.00) (Code: 532391) :- Net profit of the company has increased by 77 per cent and sales by 51 per cent during last three years. During last 9 months period ended in December, 2008 company has successfully maintained the momentum. During same 9 month period sales of the company improved by 74 per cent to Rs. 605 crores and net profit by 58 per cent to Rs. 154 crores. Company had declared bonus at the ratio of 7:10 in May 2008 Considering the rising demand in healthcare segment financial performance of the company is expected to improve during coming months. Grab the opportunity to invest at current market price for medium to long term.
Glen mark Pharma (Rs.129.00) (Code: 532296) :- Company is one of the fast developing Indian formulation company. Company has diversified its business in to new geographic and API segments, which has resulted in to huge rise in the income of the company. During Q3 of current FY company has earned net profit of Rs. 36.92 crores from gross business of Rs. 244.55 crores, which has resulted in to EPS of Rs. 1.47. Volume has increased on the counter at current price. Stock price has bounced back after creating a strong bottom at Rs. 120. There are indications of fresh buying on the counter. Invest on the counter for medium to long term. Include the stock in your portfolio.

Source: Internet (SmartInvestment)

Stock Ideas:

CCCL (Rs.122.00) (Code: 532902) :- The South based company Consolidation Construction Consortium is active in the field of realty and infrastructure. Company has order book of Rs. 3650 crores on hand. Even after reduction in margin income of the company has gone up during last two quarters. On the other hand sales of the company improved by 22 per cent during Q2 ended in September, 2008. Sale of the company has also moved up, during Q3 ended in December, 2008, by 30 per cent. Stock trades in the market at five times of the estimated income of the company by the end of current FY. Investment in the company is considered as best investment in comparison to other competitor companies in the sector. Company has monopoly in his sector of work. Considering the delivering quality of the company and its reputation investment in the scrip may be an attractive option. It could prove to be a best investment for long term.
IDFC (Rs.54.00) (Code: 532659) :-The leading company of India provides services for infrastructure sector. Development of the company is completely dependent up on the development of domestic sector. Company is likely to be a one of the fast developing company as companies from the sectors of energy, transportation and telecom sector. Company has even entered in the segment of Asset Management Company (AMC) with acquisition of mutual fund business of Standard Chartered. Stock price has seen upward revision during last few sessions. ICICI has recommended investment in the scrip with target price of Rs. 90.
Bartronics (Rs.74.00) (Code: 532694) :- Company has received order from Delhi Municipal Corporation for 2000 Kiosks, which has resulted in to improvement in stock price. Company is expecting income of Rs. 5000 crores from the project in 9 months period. On the other hand company has also bagged an order of RFDI supply order from Singapore government. Company is likely to get some orders from banking industry in connection with visa master certification. Stock trades in current market at 7 times of the income of 2008. Invest in the scrip at every dip in the price.

PFC (Rs.137.00) (Code: 532810) :- Company is providing finance in power sector. It is a leading finance company from the power sector and it is likely to earn good benefit from the rising demand for power. Investment on the counter is likely to benefit investors. Loan portfolio of the company shows stable growth is likely to lead to good growth of the company. Company is likely to earn net profit of Rs. 1447 crores from gross income of Rs. 2169 crores during 2009-10, which will result in to EPS of Rs. 12.58. Stock trades in current market at 1.36 times of estimated book value of the scrip during FY 2009-10. The stock with PE ratio of 10.88 is expected to provide 18 per cent return to the investors.
KEC International (Rs.136.00) (Code: 532714) :- The company from RPG group is active in the segment like power transmission, engineering and construction business. Company has recently bagged an order of Rs. 67 crores from Power Grid Corporation and Rs. 255 crores from rural electrification project from WB based company. Company has also bagged orders from AP government for turn key transmission projects. Company has earned net profit of Rs. 24.97 crores from the gross income of Rs. 886.31 crores during Q3 ended in December, 2008. Company is expected to announce very sound financial result by the end of FY 2008-09. Investors should hold their investment in the scrip.

Source: Internet (SmartInvestment)

Stock Ideas

Central Bank of India (Rs.38.00) (Code: 532885) :- The PSU bank has network of 3513 branches and 237 extension counters accross the country. It is ranked third amongst PSU banks of India. The bank has equity of Rs.404.14 crores. Gross income of the bank was Rs. 5431 crores and net profit was Rs. 155 crores during the quarter ended in September, 2008. EPS during the
period was Rs. 3.85. Book value of the stock is Rs. 80. If we consider the current market price of the scrip of Rs. 38-39 it is available in the market at 0.50 times of the price to book value.Bank is likely to benefit due to further interest rate cut in days to come. Investors may plan investment in the scrip for period of 2 to 3 years to earn 25 to 30 per cent return on investment.
Ahluwalia Contractors (Rs.32.00) (Code: 532811) :- The company, which was established in 1979, is active in the business of engineering procurement. The business includes construction of buildings, malls, multistorage residential complexes, offices, hotels, IT parks and hospitals. Company has earned net profit of Rs. 14.52 crores from net sale of Rs. 301.75 crores during quarter ended in September, 2008. Company has sound order book of Rs. 3750 crores. Company has also bagged biggest housing contract. The township, which is coming up has gross value of Rs. 688 crores. Considering the huge order book and probability of future developement of the company investment in the scrip is likely to prove beneficial for the investors.
Dena Bank (Rs.35.00) (Code: 532121) :- During 3rd quarter ended in December, 2008 financial performance of PSU banks, including Dena Bank has shown good imporvment. Net profit of Dena Bank earned net profit of Rs. 140.36 crores, which shows improvement of 38.87 per cent in comparison to same quarter of previous FY. Gross income of the bank has improved from Rs.804 crores to Rs. 1093 crores during the period,

Unichem Laboratories (151.00) (Code : 506690) :- Have been churning out excellent nos from last few quarters. For the Dec’08 qtr, it recorded whopping 90% increase in net profit to Rs 28 cr with 10% improvement in sales to Rs 152 cr. It posted an impressive OPM of 24% against 17% last fiscal. The Goa and UP plant has already got the US FDA approval whereas MP plant is expected to get it soon. Company has a wide chronic care portfolio with cardiovascular and diabetology therapeutic segments contributing around 50% of the domestic formulations. Lately company has launched new division focusing on Dermatology and has even introduced 15 products of this segment in the market. For FY09 it is estimated to report topline of Rs 650 cr and PAT of Rs110 cr leading an EPS of Rs 31 on current equity of Rs 18 cr having face value as Rs 2/- per share.

Source: Internet (Smart Investment)

Stock Ideas for 28th October (DIWALI)

Indian Stock Market may open Flat to positive and remains positive.
Today's Intraday Trading Calls / Stock Tips (Keep Appropriate Stop Loss for each trade):

BANK OF BARODA (228)
YES BANK (60)
GODREJ INDUSTRIES (72)
HDIL (136)
SATYAM COMPUTER (287)

MED TO LONG TERM DELIVERY BUY:
Buy Videocon Industries (511389) CMP Rs. 100/- for Med to Long term for 100% gain.
Buy Andhra Petro (500012) CMP Rs. 10/- For Med to Long Term Target Rs. 35+.
Buy Ansal Buildwell (523007) CMP Rs. 16/- For Med to Long Term Target Rs. 60+.
Buy Golden Tobacco Ltd (500151) CMP Rs. 50/- For Med to Long Term Target Rs. 150-200.

Good Luck

Bulls Eye

For coming week again expected some positive trend in market for coming week market is high volatile we expected some volatile coming in next week For coming week sensex important Support is at 10050 weekly basis sensex resistance is at 10800—10950—11220 above this next important resistance is at 11450 if sensex closes above this level then next target for sensex is at 11600 on weekly basis sensex support is at 10400—10320—10150 below this level next support is at 10050 for weekly basis nifty resistance is 3350—3480—3610 above this level next resistance is at 3750 on weekly basis nifty support is at 3205— 3140—3060 below this level next support is at 3005.for next week strategy in f&o once an Buy nifty future with a weekly target of 3420 in down side strong support is at 3205 keep a stoploss of 3220 expected positive trend see in market in this week.
Stock for this week
Ranbaxy lab : -Buy at current levels with a upper target of 310 it has important support is at 275 below this level next support is at 262 if it break the level of 262 then we see some fall in Ranbaxy lab take stoploss of 275 .

Shakti pump : looking explosive on chart buy at current levels at 91 it has strong support is at 87 keeping a stoploss of 87 on weekly basis take a target of 96.
Esse dee alumin: This stock are looking good for coming week there is upside potentional till around at 248 and down side strong support 212 keep a tight stoploss of 215 on weekly basis take a target of 245.
Ranbaxy lab fut : - Buy at 292 with a target of 310 with a tight stoploss 272 BELOW 272 expected some bearish trend in Ranbaxy.

Ksk energy fut : - Buy at 187 with a stoploss of 176 with a target of 199 above this next target is 205 in coming days.
Aban off fut : - Buy at current levels considering 1111 with a upper target of 1150 with a stoploss of 1080.

Source: SmartInvestment (Bullseyes)

Stock Ideas: Voltas, Idea, Canara bank

Nifty Future (3290) On the way up key a Major resistance at 3360. break above 3360 nifty lead to 3400/3440 area. Below 3200 support at 3160.
Canara Bank.(173) Buy at decline for objective of 186/195 area. Now break above 185 than should lead the stock towards 201/211 area. Keep stop below 166 area. Very positive bias for this stock.
IDEA(64) buy at CMP for objective of 70 area. Now break above 70 than should lead the stock towards 76 area. Keep stop below 59 area. Very positive bias for this stock.
Sobha Dev. (121) Intimate buy position in Oct. future on any dips to 115 area. For an objective of 129. A break above 129 will stock indicate strength in the upmove. stoploos below 107.
Mercatorlines (37) Buy October future with stoploss below 34.50 for an objective for 42/45 area. intimate 5 days position..

Arvind Mills (17.50) Buy future at any decline rate nr. 16 with stoploss below 14 area for an objective for 21/23 area. intimate 5 days position.
Voltas (64) Buy future at rate nr. 60 with stoploss below 57 area for an objective for 73/79 intimate 7 days position.
Sintex (195) Intimate buy position in October future on any dips to 185 area. For an objective of 220/235. A break above 235 will stock indicate strength in the upmove. stoploos below 174.

By Parthiv Jhaveri (SmartInvestment)

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.
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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.
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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.
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Source: Internet (moneytimes)

Investment Ideas: Great Offshore, Indoco Remedies, JSW Steel

Emkay Global Financial Services has maintained its buy rating on Great Offshore with a target price of Rs 710 in its August 4, 2008 research report. "Great Offshore’s (GOFF) Q1FY2009 pre-exceptional net profit at Rs 356 million is below our expectation primarily because of lower revenue continuation from high margin offshore segment and higher than expected repairs & maintenance cost for the quarter."
"We are not changing our earnings estimates for GOFF. The company has announced that it has called of its intention to acquire majority stake in Seadragon Offshore. Hence is absence of any near term upside from acqusition we are downgrading price target of GOFF to Rs 710. We have valued GOFF at 8X its FY2010 earnings of Rs 66 and added FY2010 estimated cash per share of Rs 180 on its book. Stock currently trades attractive valuations of 6.3X its FY2010 earnings and 3.74 X EV/EBIDTA. Maintain BUY," says Emkay Global Financial Services' research report.

Angel Broking has maintained its buy rating on Indoco Remedies with a revised 15-month target price of Rs 400 in its July 31, 2008 research report. "For 1QFY2009, the company posted Net Sales of Rs 109.5 crore (Rs 100.3 crore), a yoy growth of 9.1%. Growth during the period was mainly aided by Exports, which grew 16.1% and contributed 22.1% (20.8%) of overall sales. The company’s Domestic business, on the other hand, posted a yoy growth of 8.6% during the period, with Domestic Formulations registering a growth of 8.7%. Overall, the company ended with Profits of Rs 24.6 crore (Rs 22.1 crore)."
"At the CMP, the stock is trading at 6.1x FY2009E and 5.3x FY2010E Earnings, which we believe is attractive. Going ahead, we expect Topline to clock a CAGR of 15% over FY2007-10E primarily led by Exports. The growth in Exports would be on the back of better contribution from the Regulated markets to 22% of Sales during FY2010E (17% of Sales during FY2008) registering a CAGR of 36% over FY2007-10E. We have pruned our FY2009 and FY2010 estimates by 9.8% and 9.9%, respectively. We maintain a Buy on the stock, with a revised 15-month Target Price of Rs 400 (460)," says Angel's research report.

Emkay Global Financial Services Ltd has recommended buy rating on JSW Steel, with price target of Rs 1380, in its report dated 4th August, 2008.
“JSW Steel reported 1QFY09 results, which are significantly ahead of our estimates. Net sales stood at Rs 44.56 billion (yoy up 85.9%, qoq down 9.3%), EBITDA stood at Rs 8.15 billion. However, this includes forex loss of Rs 3.67 billion of which Rs 2.29 billion is on capital account translational loss. Adjusting for the notional Fx loss (including the impact on deferred tax on the same) EBITDA stood at Rs 10.4 billion (yoy up 46.5%, qoq down 1.5%) and APAT stood at Rs 4 billion (yoy up 35.7%, qoq up 30.1%). JSW reported Adjusted FDEPS of Rs 20. We believe a large part of this performance is attributable to the exports where we believe the realization is significantly higher as compared to the domestic markets. At CMP of Rs 797, the stock is trading at 8.6x FY09 and 5.7x our FY10 FDEPS estimate of Rs 93 and Rs 138 respectively. On EV/EBITDA, the stock currently trades at 5.7x and 4.3x FY09 and FY10 estimates. We maintain BUY on the stock with target price of Rs 1,380 which is 10x our FY10E consolidated FDEPS”.

Stock Ideas: Pitti Laminations Ltd. Cosmo Films Ltd. 3i Infotech Ltd.

Pitti Laminations Ltd. (Code: 513519) (Rs.35.75) is primarily engaged in the manufacture of electrical steel laminations and stampings, which form a critical part in all industrial motors, alternators, pump sets, aeronautics, windmill generators and DG sets. It even produces small laminations on its High Speed Press for compressors. With an installed capacity of 25,000 MTPA, it is operating at 70% capacity utilisation leaving ample scope for future growth. Besides in January 2008, it has completed its forward integration plan and has put up a project for fabrication of steel stator bodies, machining of stator bodies and dropping of assembled stator core into the stator body. This will result in value addition and considerable improvement in the margin. However due to the rupee appreciation during FY08, it reported lower OPM of 12% against 14% in FY07. Accordingly, its sales improved by 15% to Rs.170 cr. but PAT declined by 35% to Rs.6.50 cr. after huge tax provisioning of Rs.4 cr. equivalent to 40% of PBT. It declared 20% dividend, which gives a yield of nearly 6% at CMP. With the rupee stable above Rs.42 it has the potential to clock a turnover of Rs.200 cr. with PAT of Rs.9 cr. i.e. an EPS of Rs.10 on its equity of Rs.9.50 cr. for FY09. A strong buy.

Cosmo Films Ltd. (Code: 508814) (Rs.83.60) is the pioneer and one of the largest manufacturers of Bi-axially Oriented Polypropylene Films (BOPP) with an installed capacity of 77,000 MTPA. It also manufactures thermal lamination film, an export focused product with higher margins. For future growth, the company is expanding its capacity by adding two BOPP lines of 40,000 MTA each. The first line is expected to be commissioned before March 2009 for which orders have 10 been placed for all major equipments. In addition, it is also adding two new lines in thermal lamination and increasing its capacity from 13,500 to 19,500 MTA. To fund all this, it recently placed 31 lakh warrants to be converted at Rs.107 per share. It has also taken the approval for issue of 10 lakh equity shares under ESOP. For FY08, it sales improved by 10% to Rs.585 cr. but the net profit zoomed by 80% due to better operating margin, lower interest and lower depreciation. It reported an EPS of Rs.23 and declared 50% dividend, which gives a yield of more than 6% at CMP. However this year, it may face margin pressure due to rise in crude oil prices with polypropylene being its main raw material. Hence it may clock a turnover of Rs.625 cr. with profit of Rs.35 cr. i.e. an EPS of Rs.16 on its diluted equity of Rs.22.50 cr.

3i Infotech Ltd. (Code: 532628) (Rs.94.10) is the fourth largest Indian software products company offering a comprehensive range of software products & solutions primarily for banking, insurance, capital markets, mutual funds, telecom, manufacturing, retail & distribution industries. For Q4FY08, its revenue increased by 70% to Rs.352 cr. and net profit jumped up 60% to Rs.50 cr. With significant growth anticipated in the transaction services business in India, the company has set up a hub and spoke model spanning across the country with cost efficient delivery capabilities and it is into processing of credit cards, insurance applications, contact point verification, soft collections, cheque clearing services, reconciliations, etc. As on date, the company has a very healthy order book position of Rs.865 cr. For entire FY08, it recorded 80% and 75% growth in sales and net profit to Rs.1223 cr. and Rs.183 cr. respectively. This translates into an EPS of Rs.14 on its current equity of Rs.130.50 cr. However, the EPS works to Rs.11 on its fully diluted equity (conversion of all FCCB) of Rs.165 cr. Recently the company has acquired a strategic stake of 26% in the Hyderabadbased Locuz Enterprise Solutions Ltd. for an undisclosed amount, with a commitment to acquire the remaining stake over a period. A strong and a safe bet.

Source: Moneytimes (Internet)

Stock Idea: South Indian Bank

At a time when the banking industry is being hammered down by the investors and analysts have been stating that the Indian banks would be having a rough time, the financial performance and the 1:4 bonus issue comes as a tight smack on the face of all the detractors.
The first bank to always declare its results, the bank, with 500 branches, 26 extension counters and 226 ATMs seems to be doing well. YoY, deposits have gone up from Rs 12,834 crore to Rs 15,378 crore registering a growth of 19.82%. Advances increased from Rs 8,509 crore to Rs 10,643 crore registering a growth of 25.08%. The bank earned a total income of Rs 405.89 crore during the quarter as against Rs 321.97 crore for the previous year registering a growth of 26.06%. It posted a net profit of Rs.38.62 crore in as against Rs 30.37 crore for the previous year quarter, registering a growth of 27.16%.
The Capital adequacy ratio of the bank is high at 13.93% against the regulatory requirement of 9%. During the quarter, the Book value per share has increased from Rs 107.01 to Rs 132.70.
From April 09, once the banking sector would be made open for investments by the foreign banks and industrial groups, lot of interest would get noticed in these banks which would vastly improve their valuations. At the current rate of Rs.104, South Indian Bank makes a good buy as the downside risk is minimal.

Source: sptulsian.com

STOCK IDEAS: KLG Systel, Ansal Housing, NCL Industries, India Glycols

Within a matter of six months, the share price of KLG Systel Ltd. (Code: 531269) (Rs.359.55) has fallen one third from its high in January 2008 despite posting a robust performance. For Q4FY08, its topline doubled to Rs.76.50 cr. and net profit shot up 75% to Rs.14 cr. For full FY08, the figures are far more impressive as it registered 120% and 140% increase in 14 revenue and profit to Rs.269 cr. and Rs.52 cr. respectively. Thus it posted an EPS of Rs.45 on its current equity of Rs.11.70 cr. but declared only 27.50% dividend for FY08 against 25% last year. The company specialises in offering technological solutions for the entire business lifecycle i.e. right from concept and creation, through plant design, project execution and management operations & optimisation to expansion/ revamp. It also provides on-line IT solutions to distribution utilities, using its self-developed software Vidushi, SG61 Technology and solution for determining the transmission & distribution losses, fixing the areas of power theft, on-the spot billing & cheque collection, enhancing revenue collection efficiency of the utilities and addressing consumer grievances. On the other hand, to capitalise on its Engineering Services Outsourcing (ESO) potential, the company has gained engineering design domain-expertise in various industry verticals and has ventured into planning, design and erection of large scale infrastructure projects. For FY09, it is expected to clock a turnover of Rs.325 cr. and profit of Rs.60 cr. i.e. an EPS of Rs.45 on estimated diluted equity of around Rs.13.25 cr.
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As per the experts, the real estate cycle has peaked out and the property prices are poised to correct substantially in the near future. Coupled with rising input costs, some of the companies are even excepted to slip into red. However, Ansal Housing & Construction Ltd. (Code: 507828) (Rs.96) being into construction of integrated township in smaller cities may continue to perform well. For Q4FY08, on a standalone basis, its revenue grew by 20% to Rs.65 cr. but its EBIDTA jumped up 50% to Rs.24 cr. But due to higher interest and tax, its net profit remained flat at Rs.13.25 cr. For FY08, its total revenue was up 25% to Rs.250 cr. and PAT increased by 30% to Rs.55 cr. posting an EPS of Rs.31 on its current equity of Rs.17.70 cr. This is among the few companies making full tax provisioning, which ensures that its profits are for real. For future growth, it has lined up gigantic 56.10 million sq. ft of development (80% in the residential segment) spread over 22 cities in the next five years. It has a rich land bank of 2500 acres with about 50% in its own name while the rest is under firm collaborators’ agreement. Earlier the company had made a preferential allotment of 17 lakh warrants to the promoters at Rs.208 and 29.50 lakh warrants at Rs.225 to others, which may not get converted into shares considering the low CMP. For FY09, it can report a topline of Rs.300 cr. with PAT of Rs.60 cr., which translates into an EPS of Rs.34 on its current equity whereas the diluted EPS of Rs.28 on its fully diluted equity of around Rs.21.50 cr. A good contrarian bet.
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The rising crude oil price is hurting most manufacturers but is indiretly benefiting India Glycols Ltd. (Code: 500201) (Rs.233.50) since it is engaged in production of ethylene oxide (EO)/mono ethyl glycol (MEG) from molasses against the conventional route of making it through distillation of crude. Thus while the price of the final product is shooting up its raw material cost remains the same thereby boosting its profit margin. It reported stellar performance for Q4FY08 as sales jumped up 60% to Rs.339 cr. and net profit stood at Rs.27 cr. against the net loss of Rs.1.90 last year. For FY08, its sales was up 50% to Rs.1304 cr. whereas PAT has more than quadrupled to Rs.178.50 cr. thereby registering an EPS of Rs.64 on its equity of Rs.27.90 cr. As a measure of backward integration, the company has set up a new distillery with an annual production capacity of 66,000 KBL at Gorakhpur in Eastern U.P and has also taken over a sugar company called M/s. Shakumbari Sugar. Moreover, it is adding an Extra Natural Alcohol (ENA) facility at Gorakhpur to meet the requirement of domestic and international markets. On a conservative basis, it is expected to clock a turnover of Rs.1500 cr. with net profit of Rs.165 cr. i.e. an EPS of Rs.59 on its current equity. It’s a good opportunity to accumulate this scrip at every decline.
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NCL Industries Ltd. (Code: 502168) (Rs.37), the flagship company of the NCL group is engaged in four business segments namely cement, cement bonded particle boards, prefab and hydel power. Presently, cement contributes 75% of its revenue, board and prefabs contribute 20% and the balance comes from hydel power. On the back of aggressive expansion, the company has doubled its cement manufacturing capacity to 630,000 TPA and is further looking to triple it to 20 million TPA within a couple of years. It has also set up a new particle board manufacturing facility in Himachal thereby taking its total capacity to 80,000 TPA. On the other hand, its prefabricated structures division is witnessing good demand and has bagged a huge order worth Rs.50 cr. a few months back. Fundamentally, it recorded 30% growth in sales to Rs.193 cr. whereas PBT grew by 45% to Rs.43 cr. Due to high tax provisioning, its net profit improved marginally by 7% to Rs.29.50 cr. posting an EPS of Rs.9 on its current equity of Rs.32.50 cr. With rising input costs and the government interference on cement prices, the company is estimated to report a topline of Rs.275 cr. and maintain its profit of around Rs.30 cr. i.e. EPS of Rs.9 on its fully diluted equity of Rs.34.90 cr.

Source: Internet (moneytimes)

Stock Idea: Tips Industries

A big name in the Indian film industry, Tips Industries is a name to reckon with when it comes to music albums and now, to some extent, production and distribution of Hindi movies too. Owned by Kumar Taurani, the financial result of Tips for the year ended 31st March 2008 has been one of its best ever. 

Net profit rose by an unbelievable 874.78% to Rs 11.21 crore in the quarter ended March 2008 as against Rs 1.15 crore during the previous quarter ended March 2007. Sales rose 980.72% to Rs 74.57 crore in the quarter ended March 2008 as against Rs 6.90 crore during the previous quarter ended March 2007. 

For the full year, sales rose 352.03% to Rs 113.37 crore in the year ended March 2008 as against Rs 25.08 crore during the previous year ended March 2007. The company had a total operating expense of Rs.92.13 crore, of which it incurred Rs.66.77 crore on cost of film production and distribution. EBIDTA rose by over 7 times at Rs.24.37 crore and PBT was up from Rs.1.42 crore in FY07 to Rs.22.09 crore. Net profit rose by a jaw dropping 1757.14% to Rs 19.50 crore in the year ended March 2008 as against Rs 1.05 crore during the previous year ended March 2007. On an equity of Rs.17.30 crore, the company posted an EPS of Rs.12.07. 

The company has now got three major areas of operation - production and distribution; music and artist management. From being a mere cassette company, it has now emerged as a production house and that is soon becoming its mainfray. 

The company’s latest release was Race, did good business and infact the website of the company proclaims it as the “biggest blockbuster of 2008.” It’s another movie – Kismat Konnection is scheduled to be released on 18th July 08’. It has also signed on Raj Kumar Santoshi to make a comedy film starring Ranbir Kapoor and Katrina Kaif. It has also gained rights to the legendary film – Amar Akbar Anthony. It also released the music album of Atif Aslam - Meri Kahani, which is doing good business. Interestingly, film actor, Akshay Khanna holds 2.79 lakh shares in the company. 

Adlabs Industries is now moving very fast into all the areas which has been a domain ruled by Tips. But there is so much in the industry that many can co-exist and Tips is a brand to reckon with. Stay invested. 

Source: sptulsian.com

Stock Idea: Tata Chemicals

Tata Chemicals, the Tata Group promoted inorganic chemical and fertiliser major, has posted exuberant results for the year ended 31st March 2008.
On a consolidated basis, though its net sales improved only marginally by 3.67% at Rs.6023.14 crore, the over 4 times rise in other income helped give a fantastic boost to the bottomlines. Other income for the year was at Rs.566.74 crore of which Rs.487.47 crore came in via profit on sale of investment.
The company’s soda ash business performed very well despite floods at Mithapur and operational difficulties at Magadi. Its urea operations performed strongly with production for the year under review at a record high. Erratic availability of phosphoric acid however impacted phosphatic fertiliser operations. Revenues for FY08 from the fertiliser business stood at Rs 2,506 crore. The plants at Babrala recorded its highest urea production this year, despite natural gas supply interruptions
The operating expense of the company for FY08 was at Rs.5048 crore, of this Rs.2060.07 crore was due to raw material costs and Rs.938.73 crore was due to power and fuel costs.
Consequently EBIDTA was up 46% at Rs.1618.58 crore. The company also made an exceptional gain of Rs.76.70 crore on exchange rates and this pushed up the PBT by 57% at Rs.1175.87 crore. The company’s tax outgo was marginally down and this further helped the Pat, which was up by a whopping 90% at Rs.964.40 crore. On an equity of Rs.230.98 crore, it posted an EPS of Rs.43.51.
Tata Chemicals, the second largest manufacturer of soda ash and the third largest producer of sodium bicarbonate in the world, sold over 680,000 tonnes of soda ash during the financial year. Higher input costs, especially those of coal, coke and limestone impacted production. Though at the same time, price increases of soda ash on the back of strong demand, helped mitigate these threats.
Work on debottlenecking of the urea plant at Babrala is progressing on schedule and is expected to be completed by December 2008. It has started the integration process of the acquired US based soda ash business of General Chemical Industrial Products Inc.in March for $ 1,005 million, from Harbinger Capital Partners. Civil construction at site for the ethanol project at Nanded has commenced and is expected to be commissioned the plant by the end of this year. It has also acquired land in Madurai for setting up a bio diesel pilot plant.
Like all the old generation Tata companies, even here, the promoters stake is very low at 29.15%. Institutions hold 40.91%. Interestingly, Hindustan Unilever holds a 2.36% stake in the company.
A month ago, the stock was quoted at Rs.410, closer to its 52-week high of Rs.440 and today it is quoted at Rs.291, which is closer to its 52-week low of Rs.231. Stay invested and at further decline you can consider long term investment.

Source: Sptulsian.com

Stock Ideas: Mindtree Ltd., Polaris

MindTree Ltd, an IT and R&D services company, announced its consolidated results for the fourth quarter ending March 31, 2008 and FY08.
For Q4FY08, the company’s total income grew by 37.3% YoY and 14.6% QoQ to Rs.217.80 crore. PAT rose 41.5% YoY and 66.9% QoQ to Rs.34.70 crore. IT services constituted 77.8 per cent of total income and the remaining came from R&D services. Revenue from India increased to 8.9% of total revenue, compared with 4.7% in Q4FY07 while the revenue from USA declined marginally to 62.4% from 64.7%.
For FY08, on a consolidated basis, total income grew by 28.4% over the previous year to Rs.767.78 crore. PAT increased by 14.7% over the previous year to Rs.103.28 crore. The EPS grew to Rs 27.45 against the guidance of Rs 24.50.
102 new customers were added during the year, bringing the current active customer base to 206, including 41 Fortune Global 500 companies. Its employee strength was increased to 5,640 (as on March 31, 2008), a net addition of 1,478 people during the FY. Of this, 934 were recruited from campuses across the country. It also commenced operations from its own SEZ development center in Chennai and the SEZ facility in Bangalore.
For FY09, the company has given a robust guidance. It is expected to earn $228 million to $238 million in software revenue, indicating a growth of 24-29% as compared to that of FY2007-'08. Net profit is expected to be $31.7 million to $33.1 million, representing a growth of 23-29%. EPS is expected to be in the range of Rs 32.7-34.1, a growth of 19-24%. And when the company has issued this guidance, it was made on the basis of Rs 39.40 per US dollar. Since then the rupee has depreciated substantially and this would translate into profits surpassing the given guidance.
Currently at Rs.427, stay invested and buy for long term if it dips below Rs.400-395.

Polaris : For the year ended 31 March 2008, the total income was Rs 1,117.41 crore. Revenues from the sale of the Intellect range of banking products comprised 19.6% of total revenues, with 12 installations in areas like wealth management, credit cards and core banking solutions.

Operating profit (EBITDA) was Rs 136.30 crore and profit after tax (PAT) was Rs 73.21 crore. The company recorded 22% growth in total income in dollar terms. This is quite good considering that the rupee had appreciated during this period. The company posted a net profit of Rs.73.21 crore, and EPS for the year was at Rs.7.42 per share.
For the quarter ended 31 March 2008, total income was Rs 290.06 crore. Operating profit (EBITDA) was Rs 36.21 crore and profit after tax (PAT) was Rs 21.45 crore. The company billed the orders in Q4FY08 at Rs 39.83 a dollar, Rs 4.92 less than that the billing rate in the same quarter in the previous year. It has hedged the revenues for the FY09 at an average rate of Rs 40.07 against the dollar. The dollar is currently hovering in the range of Rs.42.60/42.80. The company has given a guidance of 20% CAGR for the current year.
Polaris bagged 14 new deals in the quarter including a master services agreement with a Fortune 10 bank in North America. It also increased its utilisation rate by 200 basis points to 76.55% on a q-o-q basis.
The board considered a proposal of buy-back of its equity shares and had discussions on this subject. In the course of the discussions, members drew attention to the real estate investments made by the company and suggested that best options to maximise shareholder value from these investments be explored. Accordingly the board decided to defer its decision on the buy-back of equity shares and appointed a committee to give recommendations to enable the board to take a decision at its next meeting.
Currently quoted at Rs.78, best to stay invested, what with the dollar improving against the rupee.

Source: sptulsian.com

Stock Idea: Spice Jet

Karvy Stock Broking has maintained its buy rating on SpiceJet with a revised target price of Rs 50 in its June 26, 2008 research report. "We expect SpiceJet to report revenues of Rs 4352 million for the quarter as against Rs 4085 million reported during 3QY08. Revenues would increase on account of increase in the number of departures. We expect the company to report net loss of Rs 805 million as against net profit of Rs 93 million reported during 3QFY08."
"For FY09E we expect the company to report net loss of Rs 1568 million, which is 7.8% higher then our previous loss estimate of Rs 1455 million. On account of the above mentioned reasons, we are downgrading our price target by 16.7% from Rs 60 to Rs 50. During the recent past the stock has fallen sharply and therefore even though we are downgrading the target price the stock still remains a BUY," says Karvy's research report.

Investment Picks: IDEA, Llyod Electric, IGL

Idea cellular (Rs. 105.00) (Code 532822) :-Financial performance of the one of the leading wireless telecom company was excellent in the quarter ended on 31st March 2008. The company has its operations in 11 out of the 22 circles in the country. The company will start its operations in other 11 circles in around one year. The company is expected to increase its subscriber base by on crore customers and with inclusion of new subscribers base total subscribers of the company will reach to the level of 2.5 crores. Company is likely to add around 17 lac customers, a month after six months and growth rate of the company is expected to touch the level of 50 per cent by the end of calendar year 2008. The company has turn over of Rs. 6719 crores and net profit of Rs. 1044 crores during the FY ended on 31 March 2008. Company has EPS of Rs. 3.96 and PE of 27. EPS of the company is likely to reach to the level of Rs. 5.66 and Rs. 8 in FY 2008-09 and 2009-10 respectively, where as PE of the company is expected to
touch the level of 19.26 and 13 respectively during the two FY. Private equity company Aditya Birla has invested Rs. 64 crores in the company to purchase 20 per cent equity stake of the company. Aditya Birla has total 57.69 per cent stake in the company. Even international investors have started taking interest in the company.

Lloyd Electric & Engineering (Rs. 94.00) (Code 517518) :- The Company is largest producer of Evaporate and conditioner coils in the country. The company has captured 60 per cent market share. The company manufactures window split Air conditioners for MNC’s. The company also provides AC coach on turn key basis to railways. The company is also in the field of designing, manufacturing, supply and installation plus maintenance services. Gross turnover of the company was Rs. 650 crores and profit of Rs. 31 crores after payments of tax of around Rs. 58 crores (PAT) and has EPS of Rs. 19. Investors may invest in the scrip as the price is damn cheap.

Indraprasth Gas (Rs. 118.00) (Code 532514) :- Company was promoted by BPCL and GAIL to work in the area of distribution. Both promoters has 22.5 stakes in the company, where as mutual funds has total holding of around 40 per cents. Public has 15 per cent shares in their kitty. Total equity capital of the company is Rs.120 crores. Gross income of the company during FY 2007-08 was Rs. 706 crores, which is in comparison to the income of company during FY 2006-07 of Rs. 614 crores. PAT of the company stood at Rs. 174.50 crores and EPS at Rs. 12.46. Company has increased its dividend payments. Stock has seen 52 weeks high of Rs. 182 and low of Rs. 102. Investment the scrip may provide good return in 8 to 12 months period.

Source: internet (Smart Investment)

Stock Idea: Prime Property Development Corp.

Prime Property Development Corpn. (Code: 530695) Rs.65.75
Incorporated in 1992, Prime Property Development Corporation Ltd. (PPDCL) is small real estate developer based in Mumbai. It made a late entry and started its real estate activity only in 2002. PPDCL is led by Shri Padamshil L Soni who has a rich experience of nearly two decades in construction. Apart from his two sons, the company has eminent personalities on its board including Shri Y. C. Pawar, Shri K. Nalinakshan, Dr. B. Samal to name a few. Under their leadership, the company has now positioned itself as a unique company catering to the niche segment of the property market. Within a short span of time, the company boasts of constructing landmark residential and commercial buildings for high end customers in Mumbai. ‘Prime Beach’ and ‘Prime Centre’ constructed in Santracruz by the company are among the most luxurious apartments and also well known for its modern and elegant architecture. On the other hand, its ‘Prime Plaza’ is a 100% commercial project with ultra modern facilities in Santacruz was a huge success. ‘Prime Avenue’ – a 100,000 sq. ft. residential cum commercial project in Vile Parle was the flagship project of the company comprising residential flats and large commercial units like showrooms, shops and offices.
Currently, PPDCL is developing two projects that are nearing completion. Of these, ‘Prime Down Town Mall’ project is much bigger being a 270,000 sq ft luxurious composite Mall with multiplexes. The mall is at the prime location of Hughes Road, Mumbai and is being constructed in partnership with others. Once operational it will be among the largest malls in Mumbai with hi-tech elevation and an international feel. ‘Prime Tech Park’, the other project is a 90,000 sq ft commercial building in Vile Parle mainly for IT /ITES companies. It is just next to the Western Express highway and barely a few kms away from the domestic and international airports. Apart from these two projects, the company has undertaken two more projects, of which both are shopping malls – one in Mumbai and the other in Pune. The Mumbai mall name ‘Prime Square’ is a four storey, 70,000 sq ft mall located on, S.V. Road, in Goregaon – a flourishing suburb of Mumbai. The Pune mall called ‘Prime Pune Mall’ will be a gigantic 430,000 sq. ft. state-of-the-art mall with anchor shops, multiplexes, food courts, entertainment area and a hotel. In short, the company is estimated to generate more than Rs.500 cr. of revenue over the next 2-3 years.
PPDCL has also finalised a location in Vile Parle (W) to construct a 60,000 sq ft shopping mall and has even created a blue print for the same. It is also planning to develop a residential project in Pimpri, Pune. The plan is still on paper and yet to be finalized. Financially, due to sale of units in ‘Prime down Town Mall’ and ‘Prime Tech Park’, PPDCL has ended FY08 on quite a buoyant note. It recorded a topline of Rs.105 cr. and bottomline of Rs.32.70 cr. Importantly, it has made the highest tax provisioning of Rs.17.50 cr., which ensures the integrity of its real profit. This translates into an EPS of Rs.16 on its equity of Rs.10 cr. with face value of Rs.5 per share. It is expected to declare Rs.2.50 as dividend which gives a yield of nearly 4%. Considering the company’s current projects on hand and that too at prime locations, it may report total revenue of Rs.150 cr. with net profit of Rs.40 cr. for FY09 i.e. an EPS of Rs.20 on its current equity. Hence, the scrip is available fairly cheap at a current P/E ratio of merely 4 times. At the same time, adverse profiling of the sector coupled with higher input prices, imposition of service tax on rentals of commercial property & hardening interest rates are bound to dampen the sentiment and affect the demand for certain categories of properties. Yet, the company is largely insulated from the downturn and investors can buy the scrip at current levels with a price target of Rs.100 in 9-12 months.

Source: Internet (MT)