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Bosch – stock investment

admin — Sun, 29 Jan 2012 06:36:01 +0000

Bosch: Often referred to as pension stock, Bosch is part of Bosch GmbH and is present in India for more than 80 years. Consistent growth in turnover strikes at first glance. It has reported increase in turnover year on year since calendar year 2000. The company commands market share of around 65% in the diesel systems segment. Besides, Bosch has several other divisions like gasoline systems, packaging machinery, starters and generators security technology, automotive after-market and power tools.

Going forward, Bosch would be investing Rs 2200 crore in 2012 and 2013 for expanding its capacities.. The Bosch Group in India added 4,000 more associates in 2011 taking its workforce to 25,000 and would be adding another 7,000 in the next two years. Currently, the company is building a new electrical drives plant in Chennai, which will begin operations in 2012. Expansion plans are also underway at the Nashik, Jaipur and Ahmedabad facilities.

Goodyear India – stock investment

admin — Sun, 29 Jan 2012 06:22:07 +0000

Goodyear India, in which US based Goodyear Tire & Rubber Company holds 74% equity stake, is debt-free and had cash of Rs 217.9 crore on its balance sheet end calendar year 20120, which is equal to 31% of its market value. Its parent is in the tyre business for over 100 years.

In the domestic market, the company has several industry first to its credit like rolling out the country’s largest tyre and launching tubeless tyres.

A price benchmark is available for Goodyear India. In June 2010, the promoters made an attempt to delist the company. However, the voluntary delisting bid failed as the number of shares tendered were lower compared with the minimum number of shares required, as per the Securities Exchange Broad of India’s delisting regulation. The indicative price for delisting was set at Rs 245 but Rs 340 emerged as the discovered price through reverse book building. The company is currently trading at Rs 301.

FAG Bearings India – stock investment

admin — Sun, 29 Jan 2012 06:16:56 +0000

Part of the Schaeffler Group, Germany, which hold 51% equity stake, FAG Bearings India is the second largest player in the domestic bearing market. It is a major original equipment manufacturer supplier of bearings to the automotive, mechanical and electrical engineering industries. The company has reported increase in sales consistently in the last five years and crossed the milestone of Rs 1000 crore in sales in calendar year 2010. FAG launched 94 new products in 2010. Of these, 24 are specifically for the export market.
A debt-free company, with cash of Rs 288 crore end December 2010, FAG reported an impressive 22.3% increase in net sales and 60% in profit in the TIM ended 30 September 2011. No surprise the stock managed to withstand the bear assault in 2011 and reported a gain of 26% in the last one year.

TERA SOFTWARE – Stock Investment

admin — Mon, 11 Apr 2011 01:26:02 +0000

BSE : 590020

Rationale for Recommendation :- Steady track-record with dividend-payment Big potential in e-Governance for many many years Has bagged some BIG contracts/tenders, highest ever order book May post more than 100% growth in FY12 May post 50% growth in FY13 (over much bigger base of FY12) Land bank of 15.40 acres in Hyderabad Current valuations very low, quoting below 52week high TSL is mainly engaged in e-governance projects with various Govt and semi-Govt departments/authorities. Company has emerged amongst leading players in domestic market for e-governance projects being implemented by Central Govt, various State Govt and PSUs. Projects are executed under BOOT/BOO/BOMT model which provide end-to-end solutions to different public departments. In fact, KAVERI (Karnataka Valuation & E Registration) project was selected as Best e-Governance project by Computer Society of India. TSL has various accreditations including TUV SUD’s ISO 9001:2008 and SCOTSA (Compliance Certificate for Smart Cards) TLS’s major customers include :- Department of Space Hyderabad, Indian Railways, Singareni Colleries, National Informatics centre, New Delhi, Defence Organisation Bangalore, Geological Survey of India, National MST Radar, Department of Telecommunicatins Hyderabad, Survey of India Hyderabad, SHAR, Sriharikota, ECIL, CCMB, KAVERI, BESCOM, DPEP, NPOL, RECW etc TSL has recently bagged some VERY BIG ORDERS and its total order book as on date is more than Rs 550 crores (nearly 5
times of FY11 revenues). TSL is empanelled with UIDAI as T2F4 vendor for 15 states. TSL has bagged MAJOR order from National Population Register. Announcements of these orders is likely to be made in coming weeks. Since almost all orders are Govt projects and hence, have to be executed in time-bound agreed time-frame and TSL will do its best to complete these projects in time to avoid penalties (and company also has to give bank/performance guarantees which can be forfeited in case of noncompliance). In view of nature of these orders, TSL should comfortably achieve above-projected growth targets.

• STOCK IS AVAILABLE AT; 2.92XFY12 Eeps.2.05XFY13E Eps. TSL is one the most undervalued scrips in Information Technology sector and currently available at such tempting valuations mainly because investing community is not aware of its fat order book to be executed in next 2 years. Next year in 2012, TSL may plan to utilize its 15 acre surplus land bank by setting up some new enterprise and current market cap of TSL is just twice of its landbank value. Investors may buy big big quantity for handsome appreciation in hort-term/medium-term as well as long-term. Scrip has potential to appreciate 50% in less than 6 months and 150% in less than 15 months. BUYING STRONGLY RECOMMENDED.

Infosys Technologies – Stock Investment

admin — Sun, 03 Apr 2011 05:16:42 +0000

Infosys Technologies Ltd. (NASDAQ: INFY) was started in 1981 by seven people with US$ 250. Today, we are a global leader in the “next generation” of IT and consulting with revenues of US$ 5.7 billion

Infosys has a global footprint with 65 offices and 59 development centers in India, China, Australia, the Czech Republic, Poland, the UK, Canada and Japan. Infosys and its subsidiaries have 127,779 employees as on December 31, 2010.

Dividend payout: A stable dividend history inspires confidence in the management’s intentions of rewarding shareholders. Infosys’s payout has averaged around 20% over the past five years. The rating thus assigned is 5.

Promoter holding: A larger share of promoter holding indicates the confidence of the people who run it. We believe that a greater than 40% promoter holding indicates safety for retail investors. At the end of December 2010, the promoter holding in Infosys stood at around 16%

Liquidity: The average daily trading volume in Infosys’ stock over the past one year (52-weeks) has been high at around 106,260 shares. This indicates the high level of liquidity in the stock. The rating assigned is 10.

P/E Ratio: The P/E ratio (price-to-earnings ratio) of a stock is a measure of the price paid for a share relative to per share income or profit earned by the company. This is one of the important metrics to judge the attractiveness of a stock, and thus gets the highest weightage in our risk matrix.

P/E on its trailing 12-months earnings stands at 28.6 times

Sintex Industries – Stocks To Watch

admin — Mon, 28 Mar 2011 14:42:56 +0000

Sintex Industries Limited (Earlier known as The Bharat Vijay Mills Ltd) has two divisions – textiles and plastics. In the area of textiles, we have been pioneers in high value fabrics. For more details on textile division operations please visit sintex-india.com

Plant Locations

Sintex has an effective network of 10 manufacturing plants, 12 branch offices, over 500 distributors and around 10,000 retailers spread across India

Sintex leads in meaningful innovations and solutions. With our multifarious capabilities in the field of plastics, metals, concrete etc. we have created many path breaking products

Acquired stake in Durha Constructions:

Sintex has signed an agreement with DCPL. to acquire 30% stake of the company for Rs 42 crore. This acquisition would help Sintex strengthen its execution capabilities in its monolithic business eventually.

Sintex Industries has reported net sales for the quarter ended December 31, 2010 stood at Rs 659.25 crore against Rs 520.60 crore for the quarter ended on December 31, 2009, surged 26.63%. Its net profit has grew by 38.81% to Rs 77.60 crore for the quarter ending on December 31, 2010 against Rs 55.90 crore for the previous quarter of the year. OPM’s improved by nearly 360 bps to 20.23% (Q3, 11) as compared to 16.56% (Q3, 10).

Buy Tata Motors

admin — Mon, 28 Mar 2011 14:09:27 +0000

Tata Motors is leading manufacturer of commercial vehicles in India. The company is among the top three passenger car manufacturers in India. The company is the world’s fourth largest truck manufacturer, and the world’s second largest bus manufacturer. The company has many subsidiaries but the most prominent among these is Jaguar-Land Rover (JLR) (a British car manufacturing company) which it acquired in 2008 and converted it from a loss making company to a profit making one. JLR contributes 54% to the company’s revenues. The company’s product portfolio ranges from the ultra low cost car Nano to the uber luxurious cars from JLR, from its ground breaking invention of the light commercial vehicle (LCV) the Ace to the international Prima Truck range

Tata Motors is a part of the Tata group which is headed by Mr. Ratan Tata who is also the chairman of Tata Motors Ltd. Also the management includes the likes of Carl Peter Foster who has a vast experience and has also headed the BMW Group for 20 years. The financial and operational stability also comes from people with vast experience in their field.

Tata motors had acquired Jaguar and Land Rover from Ford Motor Co. During acquisition the unit was a loss making one. But the management at Tata motors was able to achieve a turn around and not just stop losses but convert it into a profitable venture. Today around 54% of Tata Motors Revenues comes from JLR.

Multibagger- Tinplate

admin — Mon, 14 Mar 2011 13:45:53 +0000

TCIL is today the largest indigenous producer of tin coated and tin free steel sheets in India, enjoying 35-40% market share and undoubtedly the industry leader for 85 years. The company exports about 20-25% of its production directly to end-users (can-makers) and its products are well accepted in the markets of SE Asia, Middle East and some developed countries in Europe.

The Company is in the business of manufacturing and supplying reliable, cost-effective, value-added tin mill products. It manufactures various grades of electrolytic tinplates, tin-free steel sheets and Full Hard Cold Rolled Sheets (FHCR) used for metal packaging.

Tinplate Company of India is currently quoting at a EV/EBITDA (TTM) of 6.9x.
Currently the TCIL exports around 25% of its tinplate production and is now working with one of the world leaders in industry, the Corus group of UK to explore Joint marketing opportunities to tap food and packaging industry in Europe.
TCIL to upgrade its technology using Corus Know how as well as expand its geographical access to the European markets.

Buy Reliance Infrastructure

admin — Tue, 22 Feb 2011 14:55:32 +0000

Power to EPC major Reliance Infrastructure recently announced its 3QFY11 results. On a consolidated basis, the company has reported a 14% YoY growth in its sales while net profits have grown by 10% YoY. Here is our analysis of the results.

Performance summary

Consolidated net sales grow by 14% YoY during 3QFY11, 6% YoY during 9mFY11. Growth led by strong performance from the EPC segment, where sales grew by 91% YoY.
Operating margins rise to 14.9% during the quarter, led by lower cost of power purchased (both in absolute terms and also as percentage of sales).
Net profits rise by 10% YoY during the quarter. But for the decline in other income and higher interest costs, the profit growth would have been better.
Approves a share buyback of up-to Rs 10 bn. The buy-back price will be a maximum of Rs 725 per share, or around 17% higher than the current price
RIF’s net profit grew by 10% YoY during the quarter. The profit growth would have been higher but for a 35% YoY decline in other income.
The 22% YoY rise in interest costs also impacted the profit growth during the quarter.
Margins for 3QFY11 stood at 14.9%, as against 12.7% in 3QFY10.

Himalya International – Multibagger

admin — Tue, 22 Feb 2011 03:21:39 +0000

Himalya International (HIL) is a Delhi-based company and is India’s first frozen food enterprises. RIDs primary business includes plantation and processing of mushroom and vegetables. The company also processes cheese and yoghurt and manufactures nutritional supplements. Earlier HIL was only an exporter but sensing the growth prospects in the domestic market it has started to focus on domestic markets too. Its domestic sales during the last fiscal were 30.43 crore. It has launched its product in the metro cities of India under the brand name Himalya Fresh.

HIDs topline has witnessed a CAGR of 35 per cent over the past five years but going forward we believe it will chart a different growth trajectory. Recently HIL has signed a joint venture with a UK-based company called New World Paradigm (NWP), which has expertise in hydroponic and green houses. The company will use the know-how of NWP to increase the yield of its products by seven to eight times as compared to the traditional system. For this project it has earmarked an investment of100 crore in the next two years. The project will be funded in the ratio of their holding which stands at 51 per cent and 49 per cent between HIL and NhP respectively.

This know-how is expected to be used in its upcoming and existing facilities too. Apart from this, HIL has other capex plans too. Among these, the first is the capex of130 crore in Gujarat to produce 9,000 tonnes of yoghurt, 5,940 tonnes of processed cheese, 9,000 tonnes of mushrooms, and 15,000 tons of appetizers annually. The second is a planned capex of U 15 crore in Rajasthan to process almonds and cereals. The first project is being financed by the issue of warrants to the promoters, internal accruals, and term-loans of 90 crore while the second project is to be financed by the EXIM Bank of USA at a concessional rate of 4.37 per cent interest under the India Infrastructure Facility.

Both the projects are expected to go on stream in the current year and the full effect of this capacity expansion is likely to reflect in its FY12 results. It is expected that by FY12 the company will post a ropline of200 crore, which is an increase of more than two times on a yearly basis. As for the current financials of the company, for the quarter ending December 2010 its sales stood at 25.50 crore, up 14 per cent on a yearly basis and the net profit increased to6.85 crore, up 22 per cent over the same period last year.

For 9MFY11, HILs total sales were 67.5 crore and it is in a very comfortable position to achieve its guidance of90 crore in sales for FY11. The current market price of the company discounts its FY11 expected earnings by just 4.55 times. Looking at the expansion plan of the company in the next couple of years and its presence in a high-growth area of food processing our advice to the readers is to invest in the stock with a time horizon of more than 18 months and expect a return of at least 50 per cent.