BSE has provided circular with upper and lower price cap for the stocks. Here is the link http://www.bseindia.com/downloads1/PPB31122015.pdf
Thursday 31 December 2015
Monday 28 December 2015
Jamna Auto Industries
Government moves likely to benefit auto sector in medium to long term and Jamna auto is poised to benefit from it.
Disc. Invested
Themis Medicare
A turn around pharma company, available at extremely mouthwatering valuation.
(Disc. Invested)
Friday 18 December 2015
Take Solutions
(Disc. Invested)
Tuesday 1 December 2015
Manugraph India Ltd.
Possible turnaround candidate. Medium to long term investors can look into it.
(Disc. Invested)
Thursday 26 November 2015
Monday 23 November 2015
Friday 6 November 2015
Tuesday 20 October 2015
Friday 9 October 2015
Tuesday 6 October 2015
Wednesday 30 September 2015
Monday 21 September 2015
GAEL(Gujarat Ambuja Exports Ltd) - positive outlook
Tuesday 8 September 2015
Repeat calls
If your research tells that, underlying business is strong enough then average out those stocks as trader's worry will give investor the best opportunity for investments.
Wednesday 2 September 2015
A note
Recently, couple of stocks which we recommended have come down significantly. Stocks like Gokaldas and Raunaq even loose 20-25% from recommended price. We feel sorry for those investors, who have invested at higher price due to our positive coverage on the stocks, however investors who have long term view to remain invested in the market should utilize such opportunities to accumulate their convincing stocks in SIP mode on every significant decline.
Feel free to ask questions.
Feel free to ask questions.
Sunday 30 August 2015
Thursday 27 August 2015
Monday 24 August 2015
Is it a buying opportunity?
We never invest in market, we invest in business and if underlying business is strong enough, such crash in the market should utilize by investor as buying opportunity.
Tuesday 18 August 2015
Gokaldas exports
We have positive coverage on the stock at current price. Readers are advised to do their own research before any investment.
Tuesday 11 August 2015
Deccan Cement - Value buy
We believe stock has lot of potential to improve topline and bottomline. At current level, we are positive on the stock.
Thursday 6 August 2015
Innovative Tech Pack
A growing company available at cheap valuation. Investors are advised to do further research on the stock.
(Disclosure - we have positive coverage on the stock )
(Disclosure - we have positive coverage on the stock )
Wednesday 5 August 2015
Raunaq automotive components - growth story will come
Please go through http://www.raunaqauto.com/ , annual reports and information available in public domain about the company.
Disclosure - We have positive coverage on the company.
A new initiative - learn first then earn
For every investor, it is extremely important to do their own research, have their own conviction and believe in the story of the company rather than fluctuation of the stock market. Many people gets frustrated as they invest in long growth story which takes time to unfold and in that frustration they loose chances of being a winner. This was majorly due to they invest on someone other's call rather than doing their own research. Hence, they do not aware of underlying gem and how much time does it gonna take to be polished.
Since, we do not like our readers to end up into similar situation, from now onwards, we will just give hint of the stock with positive coverage on it. Investors are asked to do their own research before investing. Any question if have can be asked on comments, we will try to reply as per our best knowledge.
God bless all.
Since, we do not like our readers to end up into similar situation, from now onwards, we will just give hint of the stock with positive coverage on it. Investors are asked to do their own research before investing. Any question if have can be asked on comments, we will try to reply as per our best knowledge.
God bless all.
Friday 31 July 2015
Olympia industries - what a comeback!!!
When you take right step after learning from mistake and when you pave your way into most growing business of e-commerce, you are bound to success, the similar kind of story happens with Olympia Industries.
Historically, the company started with manufacturing of Dyed and Blended yarns in Gujarat and Maharashtra. Presently with the company’s state of art technology and its insurmountable passion for excellence the company is now spreading its wings in Marketing & Promotion of Baby care, Home & Kitchen and Beauty & Personal Care Appliances products through E commerce on Amazon as SOA (Selling on Amazon), PSP (Platinum Seller Program) & FBA (Fulfillment by Amazon). With more than 24000 products currently sold, they have now introduced their own Apparel brand in the Market.
The Company currently has warehouse in Mumbai, Bengaluru and Gurgaon to handle the massive requirements of consumers throughout the nation and is planning to expand in multiple formats to reach consumers.
When other e-commerce player in the market are taking steps for expansion and acquiring market share, they take hit on the balance sheet. Flipkart, snapdeal, ola etc. none of these e-commerce are targeting profit. On the other hand, we have a company which is earning 6% NPM and making decent profit available at very attractive valuation. Not only that, company is even growing its topline at significant rate. If the company takes every right step in future, it can be a massive wealth creator.
(Disclosure - We have a positive coverage on this company. This is my personal view on the company and viewers are advised to do their own research before investing in the company.)
(Disclosure - We have a positive coverage on this company. This is my personal view on the company and viewers are advised to do their own research before investing in the company.)
Wednesday 29 July 2015
Elantas Beck India - Evergreen stock
This is a company with excellent promoter track record, which believes in sharing their growth with small investors by rewarding them paying 920% and 595% dividend for two consecutive year. Not only that it's a debt free company with 75% promoter holding and having 50+ years of experience in the market. It is an ISO certified company, which enjoys leadership cap in the market with owning 40+ % market share in the core business of the company. The company not only sustain and improving its top line but it has also showing promising sign of improving bottom line. With current quarter result company has posted 16 INR EPS in last 3 months. We believe company is continuously going to post excellent result, however we advise our viewer to study the company further before taking any position in this counter.
(Disclosure - we have positive coverage on this company)
Saturday 25 July 2015
Automobile Corporation of Goa
A tata group company, available at satisfactory valuation, improving net profit margin, high dividend yield, CARE AA and A1+ rating on long term and short term borrowing and high conviction play on economic improving cycle. For those who are long term investors can study the stock and take their call based on their conviction.
Company info can be found here - http://acglgoa.com/
(Disclosure - we have positive coverage on this stock )
Thursday 23 July 2015
ISGEC Heavy Engineering Ltd - potentially hidden diversified global player in the market
Here's something new for you, rather than providing full coverage on the stock with what are the potential reasons for stocks to outperform the market, it would be great if our followers share their view on the stock and come up with what is the company profile, what's unique potential in business, promoter pedigree, why Mr. market has ignored it?, what are the ways of improvement etc. In short, what makes our investment so great? Hope this steps will help in learning + earning rather than spoon feeding.
Cheers, to all contributors and investors.
(Disclosure - we have positive coverage on the stock at CMP)
Tuesday 14 July 2015
V2 RETAIL - An E-commerce play
The company has been well covered by well-known stock analyst, Mr. Valuepick, So I am not repeating the same here. Story can be read from here.
However, for the benefit of my readers, based on recent development in the company and based on upcoming E-commerce IPO valuation of Infibeam, we believe v2 retail has lot of potential from the current level. Hence, we are giving positive coverage on the stock.
Courtesy - http://value-picks.blogspot.com/
However, for the benefit of my readers, based on recent development in the company and based on upcoming E-commerce IPO valuation of Infibeam, we believe v2 retail has lot of potential from the current level. Hence, we are giving positive coverage on the stock.
Courtesy - http://value-picks.blogspot.com/
Friday 10 July 2015
Subex - reviving like phoenix
Company Profile -
Subex Limited is a leading global provider of Business and Operations Support Systems (B/OSS) that empowers communications service providers (CSPs) to achieve competitive advantage through Business and Capex Optimisation - thereby enabling them to improve their operational efficiency to deliver enhanced service experiences to subscribers.
The company pioneered the concept of a Revenue Operations Center (ROC®) – a centralized approach that sustains pro fitable growth and financial health through coordinated operational control. Subex's product portfolio powers the ROC and its best-in-class solutions such as revenue assurance, fraud management, asset assurance, capacity management, data integrity management, credit risk management, cost management, route optimization and partner settlement. Subex also offers a scalable Managed Services program with 30 + customers.
The company pioneered the concept of a Revenue Operations Center (ROC®) – a centralized approach that sustains pro fitable growth and financial health through coordinated operational control. Subex's product portfolio powers the ROC and its best-in-class solutions such as revenue assurance, fraud management, asset assurance, capacity management, data integrity management, credit risk management, cost management, route optimization and partner settlement. Subex also offers a scalable Managed Services program with 30 + customers.
Subex has continued to innovate with customers and have been jointly awarded the Global Telecoms Business Innovation Award 2015 along with Mobily; in 2014 with Telstra Global; in 2012 with Idea Cellular for Managed Services and in 2011 with Swisscom for Fraud Management. Subex has been awarded the Global Market Share Leader in Financial Assurance 2012 by Frost & Sullivan and has been the winner of Pipeline Innovation Award 2013 in Business Intelligence & Analytics; Capacity Magazine Best Product/ Service 2013.
Subex's customers include 29 of top 50 operators* and 33 of the world’s 50 biggest telecommunications service providers worldwide. The company has more than 300 installations across 70 countries.
Subex's customers include 29 of top 50 operators* and 33 of the world’s 50 biggest telecommunications service providers worldwide. The company has more than 300 installations across 70 countries.
Subash Menon—entrepreneur, risk-taker, history buff and socialist-communist started a company with a loan of Rs 20,000 from an ex-employer in 1992. He built Rs 477-crore Subex out of it. In the 1990s and 2000s, Subex challenged the conventional wisdom about creating software in India. It sold branded software licences instead of selling code by the kilo (or KLOC—kilo lines of code), ploughed back cash and equity liberally for growth instead of hoarding every penny of profit, and aggressively acquired foreign companies. From 2000, its revenues grew at a compounded annual rate of 33 percent to reach $54.8 million by 2007.
Then, in January 2007, Subex bought Canadian telecom software company Syndesis, its seventh acquisition, for $165 million in cash. For the same reason, Subex raise all $180 million through the foreign currency convertible bonds (FCCB) route and piled up huge debt on the book. As it happens with many other companies, 2008 market crash put company into a difficult time. From almost 700 in 2007, its shares fell by more than half to Rs 350 in 2008, and to just around Rs 26 in 2009 which made the company sick.
Turn around -
In 2011, Anil Singhvi, a former CEO of cement maker Gujarat Ambuja and founder of investment advisory firm Institutional Investor Advisory Services (IIAS), and Sanjeev Aga, former managing director of Idea Cellular, joined the board in April 2011 as independent directors. On October 5,Surjeet Singh, who played a significant role in buy out of IGate Patni (Patni Computers) was elected as Subex’s new CEO. It is when a new inning for Subex has started.
Here are some current developments -
- Company has cut down losses and for the first time after couple of quarters, posted profit in March 2015 quarter. On the consolidated basis company has posted profit from last 3 quarters.
- Sales are rising which is a sign that company is on the positive track.
- Two tranches of FCCB conversion in the last 12 months indicates the confidence of the bond holders.
- Subex bags order from reliance jio and this can really a big opportunity for subex as reliance jio is in final phases of roll-out more details can be found here.
- The CEO has indicated that Subex intends to become a USD 100 million revenue business with a operating margin of approx 25%; stock at current market cap is available very cheap.
- After such a rough period, the executive leadership, most notably, Vinod Kumar, Ashwin Chalapathy, Shankar Roddam, Ganesh and Sekharan stayed with the company.
- Most of the clients stayed on with the company which believes they are firm believer in company's products and solutions.
We believe subex's second inning, if played well can be augur as the master stroke for the investor in the company. For risk takers and long term investors- this could be a bigger opportunity to invest. Hence, we provide our positive coverage on the company.
Friday 3 July 2015
Triton valves - hidden gem of auto sector
Triton Valves Limited is an ISO 9002, ISO/TS 16949, ISO 14001 certified and possess technical Collaboration with PIGEOT BANDIN SA-FRANCE. The company is India’s largest manufacturers of automotive tyre tube valves, valve cores and accessories. The company was established in 1975 and is based in Bangalore, India. The company designs, manufactures, and sells automotive tire valves, valve cores, and accessories in India. . It offers valves for bicycles, mopeds, motor cycles, scooters, cars and vans, trucks and buses,tractors, industrial vehicles, aircrafts, curing bags, and OTRs; cores, such as standard and large bores; accessories comprising valve caps, bridge and ring washers, rubber washers, rubber bases, bushes, as well as rim, hex, and lock nuts. The company also provides adapters and plugs, including water filling adapters, envelope adapters, and tubeless rim hole plugs; and service tools, including valve core tightener for standard bore double ended type core tightener, tubeless snap-in valve pullers for passenger cars and motor cycles, and tire tread depth gauges. Triton Valves Limited supplies its products to the tire and tube manufacturers. The company also exports its products.
Products include
- VALVES
- CORES
- SERVICE TOOLS
- ADAPTERS & PLUGS
- ACCESSORIES
Why to invest?
1. Auto sector performance is improving and so is Triton valves performance will improve -
The Indian auto component industry is one of the country's rising industries with tremendous growth prospects.
From a low-key supplier providing components exclusively to the domestic market, the industry has emerged as
one of the key auto components centres in Asia and is today seen as a significant player in the global automotive
supply chain. India is now a supplier of a range of high-value and critical automobile components to global auto
makers such as General Motors, Toyota, Ford and Volkswagen, among others.
2. One of the leading provider in India and long growth story -
Here is the list of customers in different segments
- OEM customers - Hyundai, General Motors, Ford, Honda bike, Suzuki, Toyota, Honda, Fiat, Yamaha, Mahindra, Ashok Leyland, Bajaj Auto, Tata Motors, TVS-sricakra, Wheels India.
- Tire customers - Bridgestone, Apollo, CEAT, MRF, Goodyear, Birla Tyres, Dunlop, JK Tyres.
- wheel Customers - Maxion, Wheels India, AMW
- Construction equipment customers - Larsen & Toubro, Case Construction, BEML
- International export customers - Bridgestone-Thailand, Honda,-Indonesia, Orange electronic-Taiwan
In short, they provide products to almost all well-known market leaders
3. Government initiatives -
The Government of India has allowed 100 per cent FDI in the automotive industry through automatic route. With
a special focus on exports of small cars, multi-utility vehicles (MUVs), two and three-wheelers and auto
components, the automotive sector's contribution to the GDP is expected to double reaching a turnover worth
US$ 145 billion in 2016, according to the AMP 2006-2016. Further, govt. reforms will likely to have positive impact on automotive sector which indirectly will stimulate growth of triton valves.
At the current market price of Rs. 990, the stock P/E ratio is at 13x FY15E and 12 x FY16E
respectively.
Earnings per share (EPS) of the company for the earnings for FY16E are seen at Rs. 84.
Net Sales and PAT of the company are expected to grow at a CAGR of 11% and 44% over 2013 to 2016E
respectively. We expect that the company surplus scenario is likely to continue for the next three years, will keep its
growth story in the coming quarters also. We recommend ‘BUY’ for Medium to Long term investment.
Thursday 2 July 2015
Facebook Page
Today we have officially launched our facebook page. If you have liked our recommendation, you can get in touch with us on link.
Updates on suggested stock
We have recommended couple of stocks in the past and it's time now to evaluate our performance.
We are fortunate enough to see even nine baggers in this 1 year ride. Hopefully you would have earned decent reward by being investor with our recommendation. Here, we are sharing our current hold on positions. Please share our work if you liked our recommendation.
Tuesday 23 June 2015
Swaraj engines- buy
Company Profile -
Swaraj Engines Limited (SEL) is a Mohali based company originally established to manufacture engines for the erstwhile Punjab Tractors Ltd(PTL). Swaraj Engines was earlier a part of JV between Punjab Tractors Ltd (PTL) and Kirloskar Engines to manufacture engines for Punjab Tractors. PTL had been taken over and merged with Mahindra and Mahindra Ltd. As a result, M&M now holds ~33% of SEL's equity with ~17% is held by Kirloskar Industries Ltd. SEL manufactures diesel engines, diesel engine components and spare parts. It supplies 5 types of Engines from 20HP range to 50HP range.It also manufactures high-tech engine components for Swaraj Mazda.The Company’s engine business constitutes approximately 93% of its product revenue. The remaining 7% represents value of hi-tech engine components being supplied to SML for assembly of commercial vehicle engines.
Why to buy?
- India is still largely an Agrarian Economy and will continue to be so for a long time so the long term demand looks good.
- Low Penetration of Tractors in India compared to the global average
- Majority stake owned by M&M which is the leading tractor Manufacturer in the country for 26 years and now commands above 40% market share. SEL enjoys the access to the India’s largest tractor manufacturer “M&M” (~41% market share in Domestic tractor industry),
- Capacity expansion from current 75,000 engines p.a. to 1,05,000 engines p.a. over next quarter to improve productivity and help meet the demand from M&M: SEL has undertaken an expansion plan to increase its annual capacity to ~1,05,000 engines per annum from ~75,000 engines over the next 2 quarters.
- Though growth had been flat till FY2008 since the Mahindra stake, Swaraj engines have been growing Sales and Net Profits for the last 3 years at a CAGR of ~45% and ~60% respectively
- Pristine Debt Free balance sheet, good cash flows with a decent amount of cash on books and negative cash conversion cycle. Further Capital Expenditure will probably get funded from internal accruals
- SEL’s presence in high HP segment and its growth directly dependent on Indian agriculture – An added advantage: Firstly, SEL manufactures engines in the 20‐50HP range. Around 10% of sales comes from lower than 30 HP engine,50% from 30‐40 HP and 40% from 40‐50 HP. Secondly, SEL’s growth has been directly comparable to Indian agriculture. We expect tractor industry to grow in long term on back of more productivity, low penetration, need for mechanization, higher MSPs and policies (NREGA).
Monday 15 June 2015
Basic Strategies for Investment
Golden rules of investing in stock markets
The lure of big money has always thrown investors into the lap of stock markets. However, making money in equities is not easy. It not only requires oodles of patience and discipline, but also a great deal of research and a sound understanding of the market, among others.
1. Avoid the herd mentality
The typical buyer's decision is usually heavily influenced by the actions of his acquaintances, neighbours or relatives. Thus, if everybody around is investing in a particular stock, the tendency for potential investors is to do the same. But this strategy is bound to backfire in the long run. No need to say that you should always avoid having the herd mentality if you don't want to lose your hard-earned money in stock markets. The world's greatest investor Warren Buffett was surely not wrong when he said, 'Be fearful when others are greedy, and be greedy when others are fearful!'
2. Don't try to time the market
One thing that even Warren Buffett doesn't do is to try to time the stock market, although he does have a very strong view on the price levels appropriate to individual shares. A majority of investors, however, do just the opposite, something that financial planners have always been warning them to avoid, and thus lose their hard-earned money in the process. 'So, you should never try to time the market. In fact, nobody has ever done this successfully and consistently over multiple business or stock market cycles. Catching the tops and bottoms is a myth. It is so till today and will remain so in the future. In fact, in doing so, more people have lost far more money than people who have made money,' says Anil Chopra, group CEO and director, Bajaj Capital.
3. Follow a disciplined investment approach
Historically it has been witnessed that even great bull runs have shown bouts of panic moments. The volatility witnessed in the markets has inevitably made investors lose money despite the great bull runs. However, the investors who put in money systematically, in the right shares and held on to their investments patiently have been seen generating outstanding returns. Hence, it is prudent to have patience and follow a disciplined investment approach besides keeping a long-term broad picture in mind.
4. Do not let emotions cloud your judgement
Many investors have been losing money in stock markets due to their inability to control emotions, particularly fear and greed. In a bull market, the lure of quick wealth is difficult to resist. Greed augments when investors hear stories of fabulous returns being made in the stock market in a short period of time. 'This leads them to speculate, buy shares of unknown companies or create heavy positions in the futures segment without really understanding the risks involved,' says Kapur. Instead of creating wealth, these investors thus burn their fingers very badly the moment the sentiment in the market reverses. In a bear market, on the other hand, investors panic and sell their shares at rock-bottom prices. Thus, fear and greed are the worst emotions to feel when investing, and it is better not to be guided by them.
And final words, remember investors always use opportunities to buy at low price. Because, they believe in business and their growth prospects and not in the market volatility.
- courtesy Economic Times.
Saturday 6 June 2015
Dewan Housing Finance Ltd. - Buy
Company profile -
India's second largest housing finance company in the private sector and the third largest housing finance company in india, dhfl (dewan housing finance corporation pvt ltd) , focuses on financing low- and middle-income customers and has a predominant presence in non-urban areas where housing finance is relatively under-penetrated. It is now diversifying its customer base and geographical presence through acquisitions and strategic tie-ups. Given the growing affordability and huge requirement of houses in the semi-urban and rural areas, the loan book of dewan housing is expected to grow at faster than the industry. Based in india's commercial capital mumbai, dhfl strives continually to reach out to its customers through its extensive network of 550 offices spread across the length and breadth of the country, and international representative offices, in dubai, uae and london, uk.
Specialties
- housing finance
- home loans
- fixed deposits
- nri home loans
- loan against property
Why to buy?
PAN india player with presence across customer segment
dhfl has become a dominant financier with pan india presence catering to underserved low-middle income (lmi) segment, capitalizing well on the untapped opportunity the company has registered 10 year loan cagr of 43% and has now become a 3rd largest housing finance company with aum of over inr 526b and 3.8% mortgage market share. Government’s thrust on lmi segment will expand the business pie and dhfl is well positioned to capture the opportunity given core expertise in the segment.
Rating upgrade to aaa
Ratings upgrade by care to AAA will provide wider access to debt market and will help replace high cost bank borrowings (60% of total borrowings) with lower cost bonds. The combination of increasing borrowings via bonds and likely reduction in banks base rates will help reduce cost of funds by 20bp. also, rising share of non-retail book (loans against property, developer funding) will aid margin expansion.
Branch model
The company operates through branches unlike the direct selling agent model adopted by other housing finance companies.Since this increases accountability of dewan housing's staff in terms of loans origination and monitoring, it has allowed the company to keep its non-performing assets under control. This is despite having a chunk of loans to risky segments such as self-employed customers and non-housing loans.
Asset quality to remain healthy
GNPA to remain below 1%, dhfl maintains high asset quality standards despite its focus on the lmi segment. with interest rates headed down and property prices remaining stable, we expect asset quality to remain stable. A strong record of impeccable asset quality performance across cycles provides comfort.
Insurance business turns profitable
Entered the life insurance business through a joint venture called dhfl pramerica life insurance (dpli), with US-based prudential financial. post the acquisition by dhfl, the company has reported 72% ape growth in 1hfy15 and has turned profitable. dhfl’s vast mortgage customer base offers an attractive opportunity for the company and could be a value driver for dhfl over medium term.
We believe company currently trades at attractive valuation and long term investor can acquire the stock in SIP mode.
Friday 22 May 2015
Patels Airtemp - Long term story
Patels Airtemp (PAT) is one of the leading producer of Heat exchangers,Pressure vessels Vessels,Refrigeration and air conditioning equipments. PAT now mastered in the production of Air Cooled heat exchangers ,the product which is expected to replace the widely used water based heat exchangers in future.Company producing standard and custom made products and also offering turnkey solutions for large clients from the industries like Power,Refinery,Cement,Fertilizer ..etc.
PAT’s Product Segment includes:
- Heat Exchangers: Heat Exchanger is equipment that transfers heat from one medium to another in the most efficient manner. Heat Exchangers are mainly used in the power plants, chemical plants, petrochemical plants & refineries and water treatment plants among others.
- Pressure Vessels: This is a closed container used to store gases or liquids at a certain pressure.
- Refrigeration & AC Equipment: PAT takes turnkey projects for humidification, ventilation and air-conditioning of industrial units and commercial spaces like offices, malls, residential complexes, and so on.
Why to buy?
1. Well positioned to benefit from the growing Heat Exchanger market:
The global heat exchangers industry is expected to grow at 10% cagr due to:
- Growing domestic demand from chemical, petrochemical and power sector
- Replacement market demand from the Americas, Middle East and European market (useful life of Heat Exchanger is 20-30 years)
- Significant growth kicking from India and China led by industrial demand and government effort to put industries into right direction where captive power plants and chemical processes requires heat exchangers
marketing efforts enhance future visibility: Over the past 4 years, Patels Airtemp’s outstanding order book has never exceeded 80% of its annual sales. Starting FY15, its order book stands at Rs. 137 crores (this is almost 2 times its FY14 sales).This clearly portends a very healthy sales growth for FY15.
3. Experienced management, diversified client portfolio:
PAT is promoted by N. G. Patel and his two sons, all of whom are very well qualified with mechanical engineering and MBA degrees. Together, the father-son trio has a total experience of 70 years in this field. Some other members of the board are also taking active role in strategic decision and capital allocation.
4. Growing business:
At Rs. 135, Patels Airtemp is quoting at a market cap of Rs. 69 crores. This means a multiple of 10x its FY15 earnings. In FY15 company has posted 12.23 Rs EPS. And in the half year company posted 7.5 Rs EPS. Further, we think that Patels Airtemp profits should double in this financial year by strong order book (3 times of last year) and margin improvement. This indicates that the stock is available at 6 times price-to-earnings ratio. Based on improving domestic demand, thrust on export sales, visibility of order book, clean balance sheet and trustworthy promoters, there is a strong case for investment in this stock. Company also pays decent dividend. Hence, with significant undervaluation where entire market is flourishing, we recommend to Buy Patels Airtemp at the CMP of Rs. 135 to long term investors.
Friday 8 May 2015
bambino agro industries - best bet in FMCG?
Company Overview -
Bambino Agro Industries Limited,
incorporated in 1982, is a well known brand with pan India marketing network. Company sells pasta, macaroni , noodles and a number of ready to eat items under the BAMBINO brand. From its ongoing efforts, Bambino has introduced an innovative range of products such as Spaghetti, Macaroni, and Instant Pasta besides Indian Ethnic Food like spices, masalas, instant food mix, ready to eat sweets, snacks, soups powders, and hing (compounded asafoefida) as value-added products to the already existing product line. At Present, Bambino has more than 80 prestigious products in variant styles, tastes n types and varieties.
Even this company is in operation for the past many years with a good brand recall ,its financial performance so far going smooth. However,higher debt level is the key reason for concern. Since promoters hold almost 75 % stake in it, it is easy to dilute some stake and raise funds to bring down debt burden.Considering the brand value and the premium valuations realized in some private equity deals in food sector it looks a good value bet.
In recent times company expanding to new territories and introducing various new products. Company is continuously rolling out new products in the market, same can be found here. To ramp up its sales force, company recruited many employees in recent past. To sell its ready to eat items BAMBINO started to open retail outlets in multiplexes. Even in the financial front too , company has shown decent performance from last 2-3 years. Company's year ending is in September and it already posted an EPS of Rs.6 in 6 months against last full year EPS of Rs.8. From last 3 years they are even consistent with their dividends which says promoters are trying to make an investor friendly relationship. If management is willing to take some steps like reducing debt,increasing corporate governance standards ..etc ,this stock will be a multibagger in long term.
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