Stock Ideas: Kamanwala Housing, Spanco Telesystems

After posting encouraging results for Q4FY08, Kamanwala Housing Construction Ltd. (Code: 511131) (Rs.122.65) has announced 1:1 bonus along with 25% dividend for FY08. For Q4FY08, its topline shot up 120% to Rs.28.50 cr. and bottomline surged by 85% to Rs.9.40 cr. posting a whopping EPS of Rs.17 for the quarter. But operating in the real estate & construction sector and following the revenue model on sale of agreement basis, the company is bound to post erratic and lumpy results on a quarterly basis. For full FY08, it reported total revenue of Rs.96 cr. and net profit of Rs.24.40 cr. i.e. EPS of Rs.43 on its current equity of Rs.5.65 cr. Notably, the company paid a tax of Rs.8.50 cr., which substantiates the profit. The company operates mainly in Mumbai and has a few good residential projects in Malad & Santacruz and a huge commercial project in the Bandra-Kurla complex. It has several projects lined up for future in Andheri, Mahim, Goregaon etc and even in Hydrabad. Lately, it also bought 10,000 sq. mt. land in Turbhe for Rs.15 cr. Recently, the company has allotted nearly 20 lakh preferential warrant to promoters at Rs.98. At the current market cap of Rs.75 cr., the scrip is trading fairly cheap and has the potential to cross Rs.200 level in the medium-term.

From providing telecom integration services to MNCs, PSUs and Defence sector, Spanco Telesystems Ltd. (Code: 508976) (Rs.132) has evolved to extend its expertise into the dynamic space of Business Process Outsourcing (BPO) and Radiofrequency identification (RFID) services. Recently in March 2008, the company bagged huge orders to the tune of Rs.200 cr. from Maharashtra, Bihar and M.P. governments. On the other hand, it is executing a 10-year contract to set up, operate and maintain Interactive Voice Response System (IVRS) and Regional Call Centres (RCC) for the Indian Railways in a joint venture with the Spice group. For the first three quarters, it has already recorded an EPS of Rs.17, which is higher than the entire FY07 EPS of Rs.16. Further, it is expected to clock a turnover of Rs.625 cr. with profit of around Rs.46 cr. on a standalone basis. This will work out to an EPS of Rs.22 on its current equity of Rs.20.65 cr. and an EPS of Rs.19.50 on its fully diluted equity of Rs.23.50 cr. At the same time, the company has decided to transfer all its BPO related businesses 10 including Respondez (international BPO), domestic call centre operations and the IRCTC project (a 50:50 JV with the Spice Telecom Group) into a separate subsidiary. This may be a precursor to unlocking value by hiving-off or de-merging its BPO business into a separate listed company in future. A screaming buy.

Source: Internet (MT)

Stock Idea: Nava Bharat Venture

PINC has maintained buy rating on Nava Bharat Venture with target price of Rs 340 in its June 04, 2008. "Nava Bharat Ventures Ltd. (NBVL) reported a YoY net sales growth of 89% to Rs 3.4 billion for Q4FY08. This was mainly on back of a 140% YoY rise in the revenues of its ferro alloy division. Power segment revenues also increased by 55% YoY. The OPM for the period witnessed a substantial 2,000bps jump to 46.4%, as NBVL capitalised on the unprecedented boom in the ferro alloy cycle. This led to around three fold jump in both operating profit and the net profits to Rs 1.6 billion and Rs 1.3 billion respectively."

"At the CMP of Rs270, the stock is trading at a P/E of 4.8x and EV/EBIDT of 3.8x its FY09E earnings. These, we believe are very attractive valuations for a company with very robust business model and effectively ‘Zero Debt’ . Moreover if ferro alloys continue to trade at these levels for entire FY09 (a strong possibility), then NBVL’s profitability could increase substantially. Hence, we initiate coverage with ‘BUY’ recommendation on the stock with a 12- month price target of Rs340" according to PINC report.

*****Moneybazzar's 12 month Target for Nava Bharat Venture Rs. 500+

Stock Idea: HCC

Prabhudas Lilladher has maintained its buy rating on Hindustan Construction Company with a price target of Rs 178 in its June 2008 research report. "Hindustan Construction Company’s (HCC) Rs 105 billion order book as on March 2008 includes the Rs 19.8 billion Sawalkote project, which is currently under dispute. Adjusting for this project, the order book would be Rs 85.2 billion, of which 50% contracts would have a wholesale price-based escalation, 30% would be star rate-linked and 10% linked to the metal index. The balance 10% would be fixed price contracts."
"We have a price target of Rs 178. HCC’s core business has been valued at 17x FY09 EPS, Lavasa has been valued at Rs 44 per share, the Vikhroli IT Park has been valued at Rs 16.7 per share, and the two SRS projects and annuity BOT projects at Rs 13.6 per share. We maintain BUY rating on the company," says Lilladher's research report.

Markets Today

GAP UP OPENING - SLIP IN THE LAST HOUR
Markets opened gap up at 4725.40 and flip-flopped between 4660 and 4710 through the session. However the market slipped in the later part probably due to lack in conviction to carry trade over the week-end.
Nifty closed down - 1.05 % losing 49.15 pts to end at 4627.18
Sensex closed down - 1.25 % to end at about 15572 down 197.54 pts
Broader markets too witnessed selling in late trade
Nifty Junior was down 1.31% (down 101.8 pts) ; while the CNX Midcap 100 lost 0.35% (- 21.75 pts)
BSE Small Cap Index was down about 0.51% ( -39.54 pts)
BSE Oil and Gas down 0.55% (- 55.75 pts)
BSE Healthcare Index down 1.15% (-49.88 pts)
BSE Metals Index lost 1.27% (- 199.80 pts)
BSE FMCG Index down 2.65% (-64.28 pts)
Gainers:SpiceJet gained smartly today, was up 14.49 % Cairn up (8.61%) had respectable gains by end of trade on the back of rise in crude oil price.Voltas gained 7.47%, HCC up 6.52%, Impex Ferro up 4.94%, Indiabulls Realty up 4.60%, Suzlon up 4.32%
Losers:ONGC ended its gaining streak to end with a 1.90% loss.GHCL (-11.3%), Neyveli Lignite (-7.65%), Piramal life Sciences (-7.63%), HPCL (-5.92%) all lost significantly The resilient Wipro (-4.44%), ITC (-4.07%), Mercator Lines (-4.20%) too lost.
NSE Advance Decline ratio at closing was 1 : 1.66
Total cash turnover at Rs 17589 cr today
Total F&O turnover at Rs 33425 cr Vs Rs 42656 cr on Thursday
Total market turnover was at Rs 51015 cr Vs Rs 65134 cr on Thursday
Global ShotAsian Indices ended mostly in the green, barring Shanghai and Kospi which were marginally in the red.
Nikkei (1.03%), Thailand (0.95%), Hang Seng (0.61%), Taiwan (0.08%) ended on a positive note; Kospi (-0.08%), Shanghai (-0.66%), ended in the red.
F&O Snapshot

Short Covering of Yesterday dint last long, Nifty sees fresh short build up in latter halfNifty fut slips into discount of 20 points in intra day’s trade Real Estate & Bank Stock sees short build up continuing in today’s trade as wellNSE F&O Turnover at 42888 cr lower than weekly averageNifty fut turnover at 13900 cr lower than weekly average
Options:Nifty 4800 put sheds 10.8 lakh shares

Nifty 4700 call adds 15.3 lakh shares

Nifty 4500 put adds 8.2 lakh shares
Star Trade: Cairn up 7.5%; adds 17.7 lakh shares
Fresh Short:Nifty dn 1.4%; adds 26.5 lakh sharesITC dn 3.2%; adds 13.5 lakh sharesDLF dn 4.4%; 10.7 lakh sharesNeyvli dn 8%; adds 5.5 lakh sharesIDFC dn 4%; adds 3.8 lakh shares
Long Unwinding:IFCI dn 3.1%; sheds 16.9 lakh sharesIspat dn 3.7%; sheds 13.7 lakh sharesJP Associates dn 3%; sheds 6.8 lakh sharesChambal dn 3.7%; sheds 6.6 lakh shares
Short Covering: Voltas up 6%; sheds 4.4 lakh sharesHCC up 5.6%; sheds 3.3 lakh shares

Intraday Trading Calls for 06th June

Indian Stock Market may open with gap up but remains volatile as today is inflation data friday. But US markets closed higher yesterday and all other global markets also performing well today so market will remains positive and positive closing expected.

Today's Intraday Trading Calls/Stock Tips:

APTECH

RPL

BANK OF INDIA

PRAJ INDUSTRIES

INDIABULLS REALEST

GSS AMERICA INFO

For Levels and Targets CLICK HERE.

Short-Med Term Delivery Call: Buy GHCL (57) Target 90+

Others: Cairn India, Videocon Industries and Midcap, Smallcap IT sector like 3i Infotech, Micro Tech, KPIT, Tanla Solutions, Prithvi Info.

Good Luck

Stock Idea: PVR

Prabhudas Lilladher has maintained its buy rating on PVR with a target price Rs 318 in its June 3, 2008 research report. "PVR’s Q4FY08 results exceeded our expectations. Revenue for the quarter grew by 32.9% YoY to Rs 543 million. PVR reported impressive full year numbers. Its consolidated revenue for the year grew by 49.7% to Rs 2659 million. Operating profit margins expanded by 298 bps. Consequently, PAT grew by a whopping 112.2% to Rs 216 million."
"PVR is emerging as a strong entertainment conglomerate with complete integration across the entire film value chain and entry into exhibition related retail entertainment businesses. We expect PVR’s existing business to report revenue and profit to grow at 48% and 70% CAGR respectively over FY07-10. At the current market price of Rs 174, PVR is trading at 12.7x FY09 and 8.4x FY10 earnings. We expect the company’s valuations to be re-rated as it aggressively scales-up its new ventures. We maintain BUY rating on the stock," says Lilladher's research report.

Markets Today

The markets have rebounded sharply in late trade and ended with strong recovery of half of Wednesdays losses led by buying in technology, telecom, power, FMCG, banking, metal, pharma and some oil and gas stocks. It was remained choppy till 2 pm and after that shown smart bounce back. Positive European markets also played some role. The Nifty closed above 4650 mark after struggling around 4550-4600 and recovered more than 140 points from days low. The Sensex closed above 15700 and recovered over 450 points from days low.
The Sensex closed at 15,769.72, up 1.64% or 254.93 points after hitting an intraday high of 15,814.80 and low of 15,314.02. The Nifty touched a high/low of 4690.60 and 4536.25, before finishing the day at 4676.95, up 1.99% or 91.35 points. BSE Midcap and Small cap indices ended marginally higher.
Biggest gainers were ONGC (7.46%), Wipro (6.25%), Infosys (5.86%), Reliance Infra (5.68%), Suzlon Energy (9.18%), Tata Power (8.06%) and GAIL (7.19%). However, DLF (-3%), Reliance (-2.58%), Ambuja Cements (-1.89%), Tata Motors (-1.82%), BPCL (-6.35%) and PNB (-2.68%) were draggers.
Market breadth also improved but closed in negative, about 1359 shares have advanced, 1571 shares declined, and 183 shares remained unchanged.
Technology Index outperformed other indices, jumped 5.01% or 220.09 points to settle at 4,617.44 as huge buying seen in Tech Mahindra, Wipro, Infosys, HCL Tech, Satyam, Patni Computer, TCS and Mphasis. The Indian Rupee was trading at 42.90 per dollar.
Amongst telecom space, Tata Communication, Tata Teleservices, Spice Comm, Bharti Airtel, MTNL, Reliance Comm and Idea Cellular have gained.
Power stocks looked fully charged up, index shot up by 2.89% to close at 2,708.49 due to sharp advances in Suzlon Energy, Tata Power, Reliance Infra and NTPC.
In the oil and gas space, ONGC, GAIL, Essar Oil, RNRL, Cairn India and Petronet LNG were gainers while BPCL, IOC, HPCL and Reliance losers. Index ended flat.
FMCG Index finished at 2,426.16, up 2.48% on the back of smart jump in Tata Tea, HUL, United Spirits, ITC, Britannia and Nestle.
Banking stocks like Yes Bank, Axis Bank, ICICI Bank, HDFC Bank, SBI and Kotak Mahindra have gained a lot. Bankex surged 1.92% or 138.21 points at 7,348.58.
There were sweet pills from healthcare sector, index was up 1.9% at 4,345.89 due to buying in Sun Pharma, Divis Labs, Dr Reddys Labs, Sun Pharma Adv, Aurobindo Pharma, Cipla and Ranbaxy Labs.
Metal stocks like Jindal Steel, NALCO, Tata Steel, SAIL, JSW Steel and Hindalco have shined. Index moved up by 1.89% or 291.44 points at 15,714.59.
However, realty stocks have shown remarkable recovery from days low though ended in red. Index plunged 0.99% to close at 6,326.05 and recovered nearly 300 points. Selling seen in Phoenix Mills, Anant Raj Ind, Ansal Properties, DLF and Indiabulls Real while buying in Mahindra Life, Puravankara Proj, HDIL, Peninsula Land and Unitech.
Auto and Capital Goods indices finished with marginal loss.
Most active counters were Reliance Industries, ONGC, Tata Steel, L&T and Bharti Airtel.
Turnover traded by markets for the day stood at Rs 73159.72 crore , including Rs 15987.26 crore from NSE Cash segment, Rs 51017.90 crore from NSE F&O and Rs 6154.56 crore from BSE Cash segment.

Source: moneycontrol.com