Multibagger: Nucleus Software Exports Ltd.

Multi Bagger: Nucleus Software Exports Ltd. Recommended Price Rs 52.60
Ashish Chugh, Investment Advisor Report Dated: Apr 02, 2009

Nucleus Software Exports Ltd. is a Delhi based company with over 20 years experience of Software development for the Banking & Financial Services industry. The company is focused on Banking, Financial Services and Insurance sectors (BFSI). The company has a 5 acres State of the Art Development Centre in Noida and employs over 2000 people. Besides Noida, the company has development centres in Singapore, Pune and Chennai.In the mid to late nineties and early two thousands, when most players in the software industry were focusing on low risk service model focusing mainly on the US markets, Nucleus Software chose to take the High Risk model of Product Development and focused on markets in Asia and Far East, the rewards of which have been accruing to the company over the past few years. Infact, the company’s products like FinnOne and Cash@Will command leadership positions in their respective product categories, with FinnOne becoming the world’s largest selling product in its product category.Nucleus has offices and subsidiaries across the globe – in Japan, Australia, Singapore, Netherlands, UAE, Hong Kong,Philippines and Korea. The company has four development centres globally. The company has a client list comprising of who’s who of the Banking & Financial sector.The company has been getting various accolades and awards from time to time, recent ones being :-a) The company’s product FinnOne has recently been ranked as World’s No.1 Selling Lending Software product by International Banking Systems (IBS), UK for the fourth consecutive year.b) The Annual Report and Accounts of the company for year ended March 31, 2008, have been adjudged as the BEST under the category 'Information Technology, Communication and Entertainment enterprises' of the 'ICAI Awards for Excellence in Financial Reporting', by the Institute of Chartered Accountants of India (ICAI). A Gold shield will be awarded to the Company by ICAI.c) For the third consecutive year in 2008, the Company has been selected as one of the “Top 25 Companies Adopting Good Corporate Governance Practices”, by the Institute of Company Secretaries of India (ICSI).d) For the second year running, the Company has been listed among “Top 15 Exciting Emerging Companies to Work For” by NASSCOM. Your Company has also been recognized under “Best Practices” for Performance Management System by NASSCOM for the year 2008.
Investment Rationale: Strong Order Flow inspite of Economic Slowdown – Inspite of the slowdown being witnessed across the globe, order flows for the company in the recent times have been strong and the company has added new customers. Nucleus bagged 8 new product orders and acquired 6 new customers for implementing 20 product modules of the FinnOne Suite & Cash@Will in the third quarter of year 2008-09. Product orders were bagged from leading financial institutions in Middle East, South East Asia, India & US. Consolidated for nine months ending December 31, 2008, Nucleus has won 20 new customers and 25 new product orders for implementing 84 modules of FinnOne and Cash Management Suite. The order flow continues in the Jan-Mar 09 quarter too as is evident from various announcements made by the company to the Stock Exchanges in recent months. Despite global recession, the company has not lost any clients.Insulated from US Markets - The company derives just about 1% of its total revenues from the US markets and is largely insulated from the happenings in the US Financial markets. The company thus may not get significantly impacted by the collapsing Banks & Financial Institutions in the US.Cash is King – The company has Cash and Bank Balance of over Rs 100 cr. The total market cap of the company currently is about Rs 170 cr. The core business is thus going at very attractive valuations. Moreover, the company carries no secured or unsecured loans on its balance sheet and is totally debt free.The stock of Nucleus Software has fallen from a high of Rs 600 witnessed in 2007 to a current price of around Rs 50. Even though, the slowdown in the world economy and the margin pressure being witnessed by the company may be some of the factors which have taken a toll on the stock price, we feel that the stock of Nucleus Software has been battered primarily on account of the perception factor – when you think of a software company catering to the Banking & Financial Institution sector, the first thing which comes to an investors mind is US and the crumbling Banks, Financial Institutions and Insurance companies there – a closer scrutiny of the company shows that contribution from US is just about 1% of the total revenues of the company.Besides the pressure on margins being witnessed by the company, one of the reasons for lower profits was Forex losses of Rs 9 cr in the 9 months of the current FY, which may not be of recurring nature. The company has actively taken cost cutting measures and rationalization of resources, the impact of which we believe will show in the coming quarters.

We believe that this debt free company, having Cash and Bank Balance of over Rs 100 cr available at a market cap of Rs 170 cr is attractively valued at the CMP.Investors can choose to accumulate the stock at the current price and on declines.

Source: Internet (By Ashish Chug)

Intraday Trading Calls for 08th April

Stock Market India may open Negative but a small recovery expected from lower levels and a flat to negative closing expected today.

Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
HCL TECH (532281)	Buy Above	112.75	116.20	120.00
	Sell Below	110.40	107.15	103.00
BPCL	Buy Above	374.60	380.25	388.00
	Sell Below	369.45	364.35	358.00
HPCL	Buy Above	262.20	267.45	272.0
	Sell Below	258.35	254.10	250.00
RENUKA SUGAR	Buy Above	97.70	101.15	105.00
	Sell Below	96.05	93.55	91.00
SINTEX INDUSTRIES	Buy Above	118.60	122.75	128.00
	Sell Below	115.40	111.60	107.00
ESSAR OIL	Buy Above	120.80	125.35	130.00
	Sell Below	117.15	112.65	108.00
ORCHID CHEMICAL	Buy Above	85.75	89.10	92.00
	Sell Below	83.35	80.40	76.00

Short to Med Term Delivery Buy:

MIC Electronics (532850) CMP Rs. 21/- Target Rs. 30-32/-

Himalya International (526899) CMP Rs. 11.50/- Target Rs. 20-25/-

GOOD LUCK

Intraday Trading Calls for 06th April

Stock Market India may open Positive and remains Positive 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
HCL TECH (532281)	Buy Above	107.60	111.25	115.00
	Sell Below	105.40	102.15	98.00
SEIMENS LTD. (500550)	Buy Above	273.20	278.45	285.00
	Sell Below	269.70	265.10	260.00
CAIRN INDIA	Buy Above	200.60	205.40	210.00
	Sell Below	198.40	194.35	190.00
SAIL (500113)	Buy Above	107.60	110.35	114.00
	Sell Below	105.20	102.55	100.00
MRPL (500109)	Buy Above	44.50	46.70	49.00
	Sell Below	43.40	41.55	40.00
BANK OF BARODA	Buy Above	246.20	251.70	258.00
	Sell Below	243.40	238.25	232.00
SCI (523598)	Buy Above	81.60	85.40	90.00
	Sell Below	79.80	77.15	74.00

Short to Med Term Delivery Buy (Penny Stock):

DCW (500117) CMP Rs. 8.45/- Target Rs. 12-15/-

Also keep an eye on ABG Shipyard, Bharati Shipyard, Essar Shipping & Mundra Port for intraday.

GOOD LUCK

Multibagger: Unity Infraprojects

Multi Bagger: Unity Infraprojects Recommended Price Rs 73.85
S.P.Tulsian, Investment Advisor Report Dated: Mar 31, 2009
Unity Infraprojects is a Mumbai based engineering and construction company providing integrated engineering and construction services on a turnkey basis including electrical, fire prevention and control, plumbing and air conditioning which is resulting in a higher margin. The company has been undertaking projects across the country for road projects, PWD. Municipal Corporations, State Govt and local authorities and have orders in hand of close to Rs 2,000 crores which would get completed in next two years. To execute the projects in time and to maintain its smooth implementation with better margins the contracts are taken of safe and remunerative projects only by the company.
The company went public in May, 2006 and paid up equity of the company is quite low at Rs 13.37 crores with face value of Rs 10 each. Promoters stake is at 70% while mutual funds, banks and FIIs hold about 20% while 10% is held by the general public. For FY 08 the total income of the company was at Rs 862 crores with PBT of Rs 91 crores and PAT of Rs 60 crores resulting in an EPS of Rs 45. Dividend of 40% was paid by the company for the year. For first 9 months of FY09, the total income of the company was at Rs 756 crores with PBT of Rs 71 crores and PAT of Rs 49 crores giving an EPS of Rs 37. Though there is drop in the margin it is more than compensated with increase in the topline. Hence, FY09 is likely to have an EPS of Rs 50 with expected PAT at Rs 67 crores. Topline for the year is likely to above Rs 1,000 crores. Share had its 52 week high/low of Rs 641 and Rs 67 and now ruling at Rs 73.85. This implies a PE multiple of close to 1.5 times. Book value per share will be over Rs 300 as at 31-3-09 even after presuming a dividend payment of Rs 5 per share. The company has a net debt of close to Rs 200 crores which is considered quite low, considering the level of activity. The company has a strong presence in Mumbai City and are known for timely completion, which are keys to success for any civil contracting company. Share at Rs 73.85 qualifies a risk free and safe buy for those who have a 6 months view, in which share has potential to touch three digit mark with virtually no downside risk.

Source: Internet (By S P Tulsian)

Intraday Trading Calls for 02nd April

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

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
LIC HOUSING	Buy Above	232.80	237.50	242.00
	Sell Below	229.50	225.45	220.00
VIDEOCON INDUSTRIES	Buy Above	92.70	97.25	102.00
	Sell Below	89.60	87.10	84.00
HDIL	Buy Above	91.10	95.15	100.00
	Sell Below	89.35	86.45	82.00
SCI	Buy Above	80.10	83.70	88.00
	Sell Below	77.50	75.20	73.00
BHARTI SHIPYARD	Buy Above	59.55	62.70	66.00
	Sell Below	57.70	55.20	53.00
VOLTAS	Buy Above	50.25	52.55	55.00
	Sell Below	48.80	47.10	45.00
BARTRONICS	Buy Above	87.60	92.10	96.00
	Sell Below	85.15	82.45	78.00

Buy Shipping Corporation of India (SCI) (523598) CMP Rs. 78/- Short-Med Term Target Rs. 100-110/-.

GOOD LUCK

Sugar Sector: Good Investment

We have been maintaining our bullish view on the Sugar sector since Nov.08, mainly on the expectations of lower production in the country. When the Govt. has been estimating country’s production at 22 million tonnes (mt) for season 08-09, in Nov. 08, we expected it to be 18.5mt. On collecting details of production on all India basis, upto 15-3-09, it is estimated at 13.1 mt. Season 08-09(expiring in Sept 09) is not likely to see a production of more than 15mt.

The reason for lower production is low yield per hectare of sugarcane crop, lower sugar recovery by the mills, farmers migrating to other crops like wheat, rice and potato and lesser number of running of mills across the country due to lower availability of sugarcane, even after paying higher rate above SAP in U.P.

If we consider opening stock of 8mt and an expected import of 2mt of raw sugar with estimated domestic production of 15mt, we will be having 25mt against our annual domestic consumption of 23mt. Therefore, as at 30-9-09, we will be left with a closing stock of just 2 mt which would be very alarming.

Though the Govt. is contemplating allowing import of white sugar at 0 duty against present rate of duty at 60%, but the same is not feasible and workable. Taking a price of $395 per tonne and a freight of $35 per tonne and adding a cost of Rs. 1,000 per tonne as port handling, insurance and transport the landed cost of white sugar works out at Rs. 23 per kg. against ex-mill price of Rs. 20 per kg. in Maharashtra and Rs. 21 per kg. in U.P.

Even import of raw is now not feasible unless the importer is confident of realising above Rs.23 per kg. Due to the lower raw price in Dec. 08, importers have contracted to import about 9 lakh tonnes of raw sugar. These include 5.25 lt by Shree Renuka Sugars, 90,000 tonnes by NCS Sugars, 50,000 tonnes by Dalmia Sugars, 40,000 tonnes each by Simbhaoli, Dharani and Rana Sugars, 25,000 tonnes each by Dhampur Sugar and the EID Parry-Cargill refinery at Kakinada, and 22,000 tonnes by the KK Birla Group. Since February 20, not a single new contract has been entered into.

Realising this shortage and hoping that this does not spoil the mood of the voters due to an expected steep rise in the price of sugar (as sugar , onion and potato are very sensitive items during elections, making Govt. to loose it) the Govt is making all the efforts to keep retail price within Rs. 25 per kg. till elections get over. This price control is achieved with free market release mechanism, releasing buffer stock created by the Govt. last year, inventory limits having imposed on the traders and by asking mills to go slow on price hike for a month or so.

Once the last phase of election gets over by 13th May it is certain that ex-mill price of sugar will rise to about Rs. 24 per kg. in next couple of months. This in turn will see a retail price of Rs. 28 per kg. Hence, mills carrying stock will reap windfall gain on its inventory. Also, Tamil Nadu mills will be at an advantage as they will continue to produce with estimated number of crushing of about 220 days. Those mills also have the benefits of lower cane price and higher realisation of Molasses.

Hence, sugar companies with higher inventory held by them will be making good profits which would get reflected in its share price from mid May. It is expected that all the sugar stocks would be able to rise by about 50% from its current levels in the next 5-6 months.

Source: sptulsian.com (By S P Tulsian)

Intraday Trading Calls for 1st April

Indian Stock Market may open Positive and remains positvie 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
REL CAPITAL	Buy Above	356.25	363.45	372.00
	Sell Below	350.40	342.65	335.00
YES BANK	Buy Above	50.60	52.75	55.00
	Sell Below	49.35	47.15	45.00
INDIABULLS REALEST	Buy Above	101.05	106.20	110.00
	Sell Below	99.15	96.25	92.00
PUNJ LLOYD	Buy Above	92.25	95.50	98.00
	Sell Below	90.15	87.55	84.00
AREVA T&D	Buy Above	204.75	209.20	215.00
	Sell Below	200.70	196.10	190.00
SUNPHARMA ADVANCE	Buy Above	53.80	56.75	60.00
	Sell Below	52.40	49.35	46.00
BARTRONICS	Buy Above	79.65	83.70	88.00
	Sell Below	77.40	74.30	70.00

GOOD LUCK