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Bulls & Bears: D Street Signals

Wassup & down in D Street

MONEY TIMES TALK: DECEMBER 26, 2020


•    Sahyadri Industries recommended around Rs.218 a month back now quotes Rs. 320. It makes asbestos sheets and other building materials and its H1FY21 profit has surpassed full FY20 profit. Although liquidity is low, this share is an excellent buy.

•    Record high steel prices led by strong demand and tight global supply can take the price of Tata Steel and SAIL to much higher levels. Buy both.

•    An Ahmedabad analyst recommends to buy imco Pesticides, Damodar Ind, GPT Infra, GTN Ind, KCP Ltd, Nahar SPG, Simran Farms, Shiva Agro, Sterlite Techno, Surana T&P and TPL Plast.

•    There is a definitive rise in cement prices. J.K.Lakshmi Cement and India Cement must be added.

•    Sugar shares are on a roll. Dwarikesh Sugar, which also makes ethanol and industrial alcohol, can be accumulated around Rs. 32 (FV Re. 1) for 50 to 75% gain in a year.

•    The promoters of Manaksia Ltd., engaged in trading of steel and aluminum products and allied business, are reportedly raising their stake as its profitability is growing. With a hefty dividend of Rs. 7.50 on its Rs. 2 paid-up shares, it merits a buy.

•    *Power Mech Project*s, which saw a 52-week high of Rs. 800 is reasonably priced around Rs. 428. Buy for roaring gains.

•    ONGC has begun production at the 8th hydrocarbon basin in Bengal. Crude prices are also firming up. The Company is one of the highest dividend players. A good long term buy.

•    A Kotak fund and five other bidders have expressed the desire to buy the debt-laden Reliance Home Finance, which may move up on this news. Risk bearing investors may buy.

•    The widespread correction in the stock markets offer an excellent opportunity to add NMDC on the back of rising demand and firming up of iron ore prices. Buy.

•    With night curfew and suspension of incoming flights from certain countries, the New Year will receive a cold welcome. Shares of hospitality companies will suffer the most. Stay away from Indian Hotels, Taj GVK, and Oriental Hotels.

•    Ramco Systems is witnessing rapid growth in its Aviation business. The Company has signed multiyear contracts in Europe and is a good buy at the current rates.

•    M&M, which had invested about Rs. 840 cr. in SsangYong, Korea, is being dumped by shareholders fearing big losses even if it is financially strong to bear the loss. Exit now and wait for an opportune time to enter again.

•    The Covid-19 scare sent the price of Indiabuls Housing crashing by around 15% to Rs. 177. The share may bounce back soon. A good time to accumulate.

•    Colgate has big product innovation and expansion plans which prompts brokerages and analysts forecast a target price around Rs. 1900. Add.

•    After the Singapore International Commercial Court announced its judgment on 21st December, Kiri Industries took a big jump but the Coronavirus scare suppressed the price once again. The share can bounce back soon. Accumulate

•    Bajaj Auto has signed an agreement with Maharashtra Government to set up a Rs.650cr. manufacturing facility at Chakan in Pune. A positive for the Company. Add.

•    Apollo Tyres has launched an online portal to promote sales. This customer friendly measure will provide hassle free services to customers and help boost revenues. Add

•    WIPRO has inked a $ 700 mn deal with Metro AG of Germany, which calls for employing 1300 people – a win-win situation for both companies. Buy Wipro for long term.

•    Firstsource Solutions has acquired PatientMatters for $13 mn. This Florida based unit will strengthen the Company’s presence in large markets like Texas and New York while adding new capacities. A big booster for Firstsource. Buy.

•    As expected, LT Foods has started going up. India Ratings & Research and CRISIL have upgraded its credit rating. Buy before it is too late.

•    CESC Ventures, the holding co. of Firstsource Solutions, trades at a whopping 80% discount to book value. Its other businesses of Too Yum! snacks, Herbolab ayurveda brand and Real estate division along with Quest Mall are thus all available for free. With Mrs.Bector’s Food IPO listing at 100% premium, this stock can easily double

•    With Dabur acquiring stake worth Rs.300crore in Religare Enterprises, it’s obvious that its experts found the stock attractive after all due diligence and it can’t be a short-term bet. Buy for multi-bagger gains.

•    With Coronavirus fears rising again in the West, Kopran Ltd. the producer of Azithyromycin drug could see its sales ballooning in the coming months. The stock can easily appreciate 50%.

•    Srichakra Tyres is the cheapest tyre stock by valuation. It used to trade at Rs.4000 odd level in 2017 but is now available around Rs.1850. With division within the TVS family, the stock could get significantly re-rated

•    Cybertech recommended last week at Rs.130 touched Rs.180. It would be prudent to book 50% profit. Also, Burger King recommended last week at Rs.145 touched Rs.190 odd. Book profit & exit.

•    Magadh Sugar, a zero debt company, has three sugar mills with 17,500 TCD, one distillery producing spirits and alcohol and 38 MW co-generation of power in Bihar. It is likely to notch an EPS of Rs 36 in FY21. A reasonable P/E of 4.5x can take its share price to Rs 162. Accumulate.

•    Mangalam Drugs, which makes anti-malarial, antiretroviral, Hydochloroquine, Chloroquine phosphate I.P., Aluminum chloride anhydrous, Uricosuric Agent etc. has notched Q2FY21 EPS of Rs 7, H1FY21 EPS of Rs 12.3 and may end FY21 with an EPS of Rs 26-28. The share may cross the Rs 208 mark at a conservative P/E of 6x (industry average P/E 27x). Buy.

•    Swelect Energy Systems is a leading Solar Power Systems company with a strong presence in the global energy market. It posted 68% higher Q2FY21 EPS of Rs 6.7 and 740% higher H1FY21 EPS of Rs 14.3 and boasts of a share book value of Rs 472. A reasonable P/E of 12x can take its share price to Rs 300 on a likely FY21 EPS of Rs 30.

•    Kilpest India’s USFDA-EUA approved TRUPCR SARS-CoV-2 RT qPCR Kit (Version 2.0) has been approved for Emergency Use Authorisation by USFDA for testing of saliva specimen samples Device OMNIgene-ORAL of DNA Genotek, Ottawa, a subsidiary of OraSure Technologies, Inc. Zero-debt Kilpest, which posted an EPS of Rs 80 in Q2FY21 and Rs 116 in H1FY21 is expected to notch an EPS of Rs 220-240 on its small equity of Rs 7.5 cr. The share is expected to be double from the current level.

•    Oil India Ltd., India’s second largest oil exploration company and a PSU, has signed an MoU with Assam Hydrocarbon & Energy Company and may post FY21 EPS of Rs 25. The share is going cheap at a forward P/E of 4.3x. Buy

•    Aries Agro Micronutrients engaged in the business of plant protection, fishery & animal nutrition, Speciality Nutrients, Water Soluble NPK and hydroponics consultancy is expected to notch an EPS of over Rs 15 in FY20. The shares are going cheap. Buy.

•    Vishnu Chemical ‘s manufactures, markets and exports chromium and other specialty chemicals from its plants in Telangana, Andhra Pradesh and Chhattisgarh and has posted 41% higher Q2FY21 net profit leading to an EPS of Rs 28. The share trades at a forward P/E of 5.9x against the industry average P/E of 33 has all the potential to touch Rs 280. Buy.

•    ISGEC Heavy Engineering has won a Rs 431cr. order from KPR Sugar & Apparels to set up a 10,000 TCD Sulphurless Sugar mill, 40 MW co-generation plant, 60 TPH Incineration Boiler and 7.5 MW power plant with Zero Liquid Discharge system for the client’s distillery on an EPC basis. It has notched 74% higher Q2FY21 net profit, 61% higher H1FY21 net profit and is likely to post FY21 EPS of Rs 32-34. The share is poised to touch Rs 375 mark.

•    Nahar Poly Films, which manufactures a wide range of micron BOPP to cater to various segments – print lam, converting, tape, textile and other developing/developed segments has notched 46% higher Q2 net profit posting an EPS of Rs 4.9 and is expected to post FY21 EPS of Rs 22-24. A reasonable P/E of 6x can take its share price to Rs 132 in the medium-to-short term. Accumulate.

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