Stock Idea: Uflex Ltd.

Uflex continues to look like a no-brainer at the current market price, says Ashish Chugh, Investment Analyst & Author of Hidden Gems.

Chugh told CNBC-TV18, "Uflex has plummeted from a high of about Rs 325 to the current price of about Rs 155 in about three months time. This has been on account of negative newsflow. The first was the news of the arrest of the chairman of the company in the month of December. Then was the Egypt crisis, where Uflex has got its manufacturing operations. Inspite of the company’s profit rising five fold from Rs 46 crore to Rs 250 crore in the quarter ending December, the stock fell from about Rs 325 to Rs 155."

He further added, "It is the largest integrated flexible company in India and one of the largest in the world. The company has got manufacturing operations in India, Egypt, Mexico and Dubai. They have aggressive plans to setup operations in other countries and are currently undertaking expansion projects at Mexico, Egypt, Jammu and Poland. Mexico phase II is going operational in the month of June 2011. In Jammu, the expanded capacity is going operational in September 2011 and Egypt is going operational in December 2011. It may get delayed because of the current situation in Egypt."

"For the first nine months of the current financial year, this company has registered sales of about Rs 2,600 crore, which is up by about 50%. Profit after tax (PAT) for nine months, is up by close to 250% from Rs 144 crore to Rs 515 crore. The current equity of the company is about Rs 72 crore."

"I am taking a conservative scenario, on the impact of the Egypt crisis on the operations of the company and also the impact of the softening finish product prices, they can conservatively do a PAT of about Rs 150 crore in the quarter ended March 2011 which means that the full year EPS is going to be on a conservative basis at about Rs 90."

"My hunch is that the EPS can be anywhere between Rs 95 to Rs 100. At the current price of Rs 155, you are getting the stock at PE multiple of just about 2. Having a profit of Rs 700 crore and marketcap of just about Rs 1,100 crore, it looks to be at least for the short-term. In future, the impact of the softening finish product prices will be more than made up for the expanded capacities, which are going on-stream in the next one year."

"This company has been a regular dividend payer. In the past, the policy has been to distribute about 15-20% of the profit as dividend. They paid a dividend of 50% in FY10 and given an EPS of close to Rs 100 this year, even assuming a 10% dividend payout, it would lead to a dividend of about 100% which at the current market price gives you dividend yield of about 6.5% to 7%."

m taking a reverse calculation just to be safe on whether to buy this stock or not. In a normal market, this stock should command a PE multiple of about 5. At the current price of Rs 150-155 the market is assuming that the EPS of the company is going to drop to about Rs 30. From a level of Rs 90-100 EPS, something has to be drastically gone wrong with the company or the economy or the market for the stock to stay at these levels."

"In the month of October, promoters have taken 1 crore 35 lakh warrants to be converted at a price of about Rs 300. Out of this, 35 lakh warrants have already been converted in the month of December, which shows the confidence of the promoters in the company."

"I believe that the fall from Rs 325 to Rs 155 is largely overdone but given the state of the market as of now and the negative sentiment prevailing, I don’t rule out the possibility of the stock dropping by another 5-10% from these levels. More or less, however, the stock trading at a PE multiple of just about 1.5 and dividend yield of about 6.5% to 7%, it looks to be a no-brainer at the current market price."

Source: Internet (moneycontrol.com)

Stock Idea: Sumeet Industries

Accumulate Sumeet Industries, says Ashish Tater, Fort Share Broking.

Tater told CNBC-TV18, "We feel the market has entered into a long-term consolidation phase with a broad range of close to 4,700-5,600. We have been suggesting to our clients that every time you enter into a midcap, at least twice short the Nifty itself. We have been recommending this from January in the New Year itself where we recommended Alok Industries and others because we have been quite bullish on textile for quite some time now."

He further added, "This strategy has been paying off well for us even now. If I see the last 10-12 recommendations that we have given to clients, there has been good Nifty returns in terms of shorting but the textile stocks have stabilised plus-minus 5%. Overall, net-net these pair trading strategies have worked well for us."

"On Sumeet Industries, for the last 20-25 days has seen a broad range of Rs 25 to Rs 28-29 mark but the Nifty has again fallen by 6-7% and is still having a negative bias attached to it. If I look into their expansion, they are going to post an EPS of close to Rs 6-6.5 for current fiscal, which will be available at Rs 28. In FY10 itself, the company has commissioned a two lakh plant on continuous polymer plants along with that capacity expansion into the FDY and POY yarns close to 23,000 TPA’s. That means one year or two year forward, the company would clock an EPS of close to Rs 12. The current price is Rs 28-30. I do not deny that the stock cannot fall to the Rs 24-22 odd levels, but that means the PE would be translated into 1-1.5 times."

"Taking a call on the textile industry, we feel the budget would be largely neutral to negative, to maximum sectors in this space but there would be some benefits to the textile stocks. If I see the demand for textile - cotton and denim, we feel there are another 2-3 quarters left for sheer outperformance in terms of share prices for the stock before this euphoria dies out."

"During this time, commodity stocks normally trade at 5 times their peak levels. That means on an estimated EPS of close to Rs 12 and discounting it by 20%, the stock should command a PE of 4 in the next six-eight months. We are targeting Rs 40-48 and we have an accumulate call on the stock."

"Looking at their entire expansion project, it needs to be funded close to Rs 500 crore, which means a lot of debt will come into the balance sheet of the company. This is one question that is worrying me, but the way they have managed their cash flows in the past, I am confident about the management. One good thing is that the management has not been sellers of the stock despite the stock having given good returns in the past.

Source: Internet (moneycontrol.com)

Intraday Trading Calls for 18th November

Indian Stock Market may open positive and positive trading expected today with very high volatility
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
DEWAN HOUSING	Buy Above	317.45	324.75	332.00
	Sell Below	312.35	306.60	300.00
SHRI LAKSHMI COTSYN	Buy Above	176.60	182.20	188.00
	Sell Below	173.40	168.55	164.00
SASKEN COMM.	Buy Above	188.25	194.60	200.00
	Sell Below	185.05	181.05	176.00
EROS INTL. MEDIA LTD.	Buy Above	186.50	191.65	198.00
	Sell Below	182.60	177.55	172.00
ADHUNIK METALIKS	Buy Above	111.55	115.75	120.00
	Sell Below	109.35	105.45	102.00
WINDSOR MACHINE	Buy Above	102.60	107.70	112.00
	Sell Below	100.05	96.05	92.00
EDUCOMP SOLUTION	Buy Above	555.60	570.25	582.00
	Sell Below	544.35	535.20	520.00

GOOD LUCK

Stock Idea: Bannari Amman Spinning Mills Ltd.

Bannari Amman Spinning Mills Limited (BASM), established in 1995 is a reputed player & a leader in cotton yarn segment in South India. BASM is a part of the Rs. 1,200 crs. Coimbatore based Bannari Amman group. The renowned group has its presence across diversified businesses like sugar, textiles, food processing, granite processing, power generation, transportation, distillery, automobile distribution, healthcare, etc. Since inception BASM has evolved to be a leader in cotton yarn spinning in South India, Commanding a premium in the market for its products. It has two factories for yarn spinning housed in around 7.85 lakh square feet in Tamil Nadu with an installed capacity of more than 1,35,000 spindles. The spinning division is in Dindigul, Tamil Nadu. The weaving division located in Coimbatore, Tamil Nadu, has an installation of 135 Sulzer projectile wider width Looms, in a working space of 2.2 lakh sq feet. The unit specializes in manufacturing superior wide-width cotton fabric in the 500-1000 thread count range. The production capacity ranges from 500-1500 sq mtrs per loom per day depending on the fabric construction. The company has strong presence in Tirupur, Kanpur and Kolkota in the domestic markets. The company is has also been exporting its products to a number of countries like Mauritius, Egypt, Taiwan and Korea.

In October 2005, BASM came with an IPO at Rs 135 per share to fund its expansion plan. On a post issue equity of 15.75 cr., the promoters’ stake is 55.55%.  BASM raised funds for capacity expansion and also to forward integrate into processing and garmenting & home textiles division

Net profit of BASML rose 134.33% to Rs 16.38 cr. in the Q2 ended September 2010. Sales rose 47.27% to Rs 129.52 cr. in the quarter. For the half year ended Sept. 2010, net profit stood at Rs 26.62 cr. on sales of Rs 242.58 cr..  The EPS for first half comes to Rs 16.9.  For the year ended March 2010, BASML had posted net profit of Rs 15.05 cr. on net sales of Rs 355.31 cr.. The EPS stood at Rs 9.5  and the dividend declared was 15%.  The Book Value per share stood at Rs 107

The expansion of its spinning unit, and integration into fabrics and home textiles has enabled the company to compete in the export markets with larger scale of operations. The higher value addition insulates the company from pricing pressures in the highly commoditised cotton yarn industry. The company operates in a niche segment and is a focused quality player earning higher than industry margins. Going forward, BASM is positioning itself as a niche player specializing in fine counts and other value added segment and should continue to earn relatively higher margins. Participating across value chain will help the company to be a One-Stop-Shoppe player and face the growing competition going forward. This will also help the company to customize their product offerings as the global retailers are rationalizing the vendor base based on quality, specifications and pricing. The Bannari Amman Spinning share at Rs 159 trades at 6 times FY11E earnings(Rs 26- Rs 27) and offers an attractive investment opportunity for the medium-long term

Investors can start accumulating the stock at current levels and add more on declines for decent returns of 50%-60% over the next 8-12 months. Accumulate.

Source: Internet (Valuenotes by Sanjay Chhabria)

Stock Idea: Panacea Biotec

Panacea Biotec (PBL) is India’s highly progressive research based health management company involved in research, manufacturing and marketing of branded pharmaceutical formulations, vaccines and natural products. The product portfolio includes highly innovative prescription products in important therapeutic areas like pain management, diabetes & cardiovascular management, renal disease management, osteoporosis management, anti-tubercular, gastro-intestinal care products and vaccines. The flagship brands of the company- Willgo for pain management; Glizid & Glizid-M for diabetes; Panimun Bioral & Mycept for kidney transplant occupy leadership positions in their therapeutic segments. This is in persuit of marketing strategies to build brands and drive the growth of the company. The vaccines portfolio consists of oral polio vaccines (type I and type III), Enivac-HB (Hepatitis B vaccine), Enivac-HB Safsy, Ecovac-4 (DTwP+Hep B), Easyfour (DTwP+Hib), Easyfive (DTwP+Hep B+Hib). Vaccines in the offing are- Anthrax, Dengue, Japanese encephalitis and several others. Panacea Biotec has earned the distinction of being a WHO pre-qualified supplier of oral polio and Hepatitis-B vaccines and are in the process of obtaining similar pre-qualifications for other vaccines.

PBL is the second largest vaccine producer in India and has been ranked as the third largest biotechnology company in India (as per ABLE Survey June 2009). While vaccines account for three-fourths of the company’s overall revenues, the balance comes from domestic formulations (the major therapeutic areas being pain management, diabetes and organ transplantation). The company has also established collaborations and tie-ups with international research organisations. Bulk of the vaccines is sold to the UNICEF, which largely caters to the Indian market and to some countries such as Ethiopia, Maldives, Nepal, Somalia and Yemen. The company has ultra modern, state-of-art production facilities at Baddi (Himachal Pradesh), Lalru (Punjab) & Delhi for manufacturing tablets, capsules (including soft gelatin), ointments (transgel formulation) liquids, herbal formulations and vaccines. The facilities are WHO cGMP compliant.

Net profit of Panacea Biotec rose 692.02% to Rs 16.87 cr. in the Q2 ended September 2010. Sales rose 52.32% to Rs 252.57 cr. in the quarter. Net profit of PBL had risen 226% to Rs 49.4 cr. in the first half ended Sept. 2010. Net sales were up 48% to Rs 506.5 cr. in the first half. The EPS for the half year on a equity of 6.13 cr. (Promoter stake-74.41%, FII/MF stake- 11.44%) stands at Rs 8. For the year ended March 2010, PBL had posted 14% rise in net sales to Rs 900 cr. on consolidated basis, whereas net profit stood at Rs 72.41 cr. (against net loss of 67 cr. in FY09). For FY10 PBL’s vaccine segment grew 24% to Rs 680 cr.(75% of revenues). Going forward, PBL has identified brand building in exports as its thrust area and it has significant presence in the global markets including the CIS, Africa, the Middle East and Asia. The company is actively exploring opportunities for launching as well as licensing out some of our patented products for manufacture/marketing in developed countries in Europe, North America and Latin America. Eyeing the lucrative pie of off-patent drugs, PBL is looking to manufacture generics to expand its domestic formulation business and has plans to venture into the US market. Over $150 billion drugs would be off-patent in the next several years as their exclusivity time matures. PBL which gets most of its sales from domestic operations, is looking to start operations in the US from this fiscal to expand its exports, the area and region which they ignored till now.

PBL would announce deals in the next few weeks and is currently working on the Japanese encephalitis and Dengue vaccine which may be launched this fiscal The company has about Rs 120 cr. of cash reserves and it is not looking for acquisitions but expects in licensing and out licensing opportunities deals in the vaccines and medicines for infectious diseases and organ rejection. At the current market price of Rs 204, the stock trades at 12.4x and 10x of FY11E (Rs 16- Rs 17) and FY12E earnings(Rs 20- Rs 21), respectively.

Investors can start accumulating the PBL stock at current levels and add more on declines for decent returns of 50%-60% over the next 6-9 months.

Source: Internet (Valuenotes by Sanjay Chhabria)

Intraday Trading Calls for 16th Novemeber

Indian Stock Market may open positive and positive trading expected today with very high volatility
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
DEWAN HOUSING	Buy Above	340.00	348.55	355.00
	Sell Below	333.45	325.60	318.00
SHRI LAKSHMI COTSYN	Buy Above	172.25	178.45	185.00
	Sell Below	169.05	164.30	158.00
SASKEN COMM.	Buy Above	197.20	203.65	210.00
	Sell Below	193.45	188.05	182.00
EROS INTL. MEDIA LTD.	Buy Above	188.50	195.25	202.00
	Sell Below	184.40	180.00	175.00
ADHUNIK METALIKS	Buy Above	111.55	115.75	120.00
	Sell Below	109.35	105.45	102.00
SUN PHARMA ADVANCE	Buy Above	105.60	110.00	115.00
	Sell Below	103.40	100.05	96.00
GEODESIC LTD.	Buy Above	136.75	141.65	146.00
	Sell Below	134.15	130.20	126.00

GOOD LUCK

Intraday Trading Calls for 15th November

Indian Stock Market may open positive and positive trading expected today with very high volatility
Today's Intraday Stock Tips / Trading Calls (Keep strict Stop Loss for Each Trade):

SCRIP NAME	TRIGGER	PRICE	TARGET 1	TARGET 2
DEWAN HOUSING	Buy Above	326.75	333.70	340.00
	Sell Below	320.35	314.55	308.00
GODREJ INDUSTRIES	Buy Above	220.05	226.15	232.00
	Sell Below	215.00	210.60	205.00
ISMT	Buy Above	63.25	65.10	67.00
	Sell Below	62.05	60.05	57.00
EROS INTL. MEDIA LTD.	Buy Above	190.00	196.45	202.00
	Sell Below	185.40	180.00	175.00
ADHUNIK METALIKS	Buy Above	111.25	114.75	120.00
	Sell Below	109.05	105.45	102.00
SUN PHARMA ADVANCE	Buy Above	105.60	110.00	115.00
	Sell Below	103.40	100.05	96.00
KPIT CUMMINS	Buy Above	160.00	166.20	172.00
	Sell Below	156.40	151.65	146.00

GOOD LUCK