Go Back   ManagementParadise.com | Management & Business Education Learning Platform Quiz , Marketplace and Community games > Stock Markets Tips & Gyan !!

A 'Buy' & 'Avoid' list of stocks from experts

Discuss A 'Buy' & 'Avoid' list of stocks from experts within the Stock Markets Tips & Gyan !! forums, part of the Quiz , Marketplace and Community games category; Investment advisor SP Tulsian and Shahina Mukadam of IDBI Capital Market pick out the winners and losers, based on Q1 ...

Reply

 

Thread Tools Display Modes
A 'Buy' & 'Avoid' list of stocks from experts
Old
 (1 (permalink))
Praveen Gurwani
love_gundu22 is just really nicelove_gundu22 is just really nicelove_gundu22 is just really nicelove_gundu22 is just really nicelove_gundu22 is just really nice
 
love_gundu22
Consultant at Capgemini
Management Paradise Member
 
Institute: Smt. CHM College
Status: Offline
Posts: 1,131
Join Date: May 2006
Age: 33
A 'Buy' & 'Avoid' list of stocks from experts - July 31st, 2006




Investment advisor SP Tulsian and Shahina Mukadam of IDBI Capital Market pick out the winners and losers, based on Q1 results of companies.

Excerpts from CNBC-TV18's exclusive interview with SP Tulsian and Shahina Mukadam:

Q: Since you track sugar so closely, has Shree Renuka Sugar and Dhampur Sugar gone down as misses for you?

Tulsian: Incidentally, both these companies have reported very poor results. I am quite disappointed and therefore, I would give them a miss.

If I take Renuka Sugar, their topline is Rs 246 crore, which shows growth, but that includes a turnover of Rs 138 crore from trading.

If I just take the sugar segment results, they have had a turnover of Rs 107 crore on which they have earned a profit of Rs 11.1 crore, which translates into a profit margin of 10.3%.

If I compare the operating profit margin or the segment results with their first and second quarter, then that was 21% and 18%. This means that inspite of the better recovery in the Maharashtra region, their profit margin fell to about 10%, which is very strange.

So I am very disappointed with Renuka Sugars and even considering their consolidated results, the topline has grown by Rs 96 crore on which not much clarity is available. Operations from their Dubai subsidiary has earned them a profit of about Rs 22 crore on which there has been no tax liability. So the major contribution to the company has been coming from their overseas subsidiary.

Dhampur Sugar too had a turnover of Rs 120 crore from its raw sugar business, out of their total turnover of Rs 358 crore on which the net profit has been Rs 15.4 crore. That means a sharp drop in the realization, which in turm means that there is an increase in the cost of the raw materials.

If one takes the overall scenario of both these companies, it is disappointing.

Q: Why has TVS Motor gone down as a hit with you?

Mukadam: I would think that the numbers were good. It did not meet some of the street expectations, but it met our expectations. I believe the volume growth was excellent in the motorcycle department and it is in line with our numbers for the company. For example, for this year, we are expecting a 57% turnover growth from them and I do think these numbers are in line with meeting those.

Q: Is Varun Shipping a bit of a disappointment?

Mukadam: Yes. I think it was the depreciation, which has really hit the company in terms of the bottomline. Turnover has also been below our expectations.

Q: Do you like Chennai Petroleum Corporation ?

Tulsian: Lately, the standalone refineries have been reporting very good numbers, mainly because of the increase in the GRM. And if you take the case of Chennai Petro, after Reliance Industries, this is the only refinery having the complexity of 9.1, which ultimately gives them very good realization and hence a very good GRM.

The company has shown very good performance and I hope that they will continue to do the same. On top of it, if you see practically all these standalone refineries, they are ruling at a PE multiple of close to 4-5 right now.

If I take their FY07 estimated bottomline or the resulting EPS, there is no downward risk. So ultimately, we look into the growth potential, which is very good in the next three quarters.

For the entire FY07, the GRM is likely to remain very good and for Chennai Petro, it should do well in the coming quarter. So I am hopeful and optimistic on this stock.

Q: Is KEI Industries a hit for you?

Mukadam: They have done better than what we expected. The topline growth has been pretty strong, 53% YoY higher. They are doing well in both HT cables capacity, which just went on stream end of last year and as well as LT cables.

Also, in spite of raw material costs moving up substantially, they have been able to improve margins by about 190 basis points. So all in all, the numbers are good, with regards to valuation. We are expecting them to do an earning of about Rs 30 for the full year and at the current price, it is just about 7 times. I think this is attractive.

Q: Indiabulls is a hit, what did you like, the numbers from the broking business or their real estate prospects?

Tulsian: I am totally impressed with Indiabulls' realty business. In fact, if you see the present trend going on in the capital market, I do not see any future or any growth coming in the future quarters from that business.

But if one really sees their realty business model, it is quite interesting. They have given the valuations of their Elphinstone and Jupiter mill property too. Apart from that, they have 50:50 JV with DLF and 150 acre land in Sonepat.

If you take the total of all this, the present value of the market price of the share is only reflecting the realty value. Plus since they have plans of hiving off this realty business into a separate company, where shareholders will also be given shares of the realty company free of cost, I think there will be great unlocking in the value.

Since all their properties are now due for development, the value unlocking or the benefits will come to the company in the form of outright profit booking or in the form of rental income from FY08-09. So all these things makes Indiabulls quite interesting at these levels.

Q: Any disclosures?

Tulsian: I don’t have any disclosure to make.

Mukadam: No, I don’t own any of these stocks.
Advertisements



Imagination is like a magic carpet.. It can take you Anywhere..............


Be Creative, Learn about-
To view links or images in signatures your post count must be 0 or greater. You currently have 0 posts.






To view links or images in signatures your post count must be 0 or greater. You currently have 0 posts.


Ideas Create.... Values Protect!!


To view links or images in signatures your post count must be 0 or greater. You currently have 0 posts.

Praveen(love_gundu)


To view links or images in signatures your post count must be 0 or greater. You currently have 0 posts.
Friends: (5)
Reply With Quote
The Following User Says Thank You to For This Useful Post:
Reply

Bookmarks

Tags
avoid, buy, experts, list, stocks
Related to A 'Buy' & 'Avoid' list of stocks from experts
 

Similar Threads

Thread Thread Starter Forum Replies Last Post
S&P too finds stocks overvalued Praveen Gurwani Stock Markets Tips & Gyan !! 0 December 14th, 2006 09:43 AM
[August 25, 2006] Buy & Sell Calls Vijith Pujari Stock Markets Tips & Gyan !! 0 August 26th, 2006 03:10 PM
Top 10 stocks you can buy now Prakash Pohwani Stock Markets Tips & Gyan !! 0 June 22nd, 2006 02:24 PM
Handling taxes & stocks: Your management guide themaharana Stock Markets Tips & Gyan !! 0 June 4th, 2006 08:28 PM
 


Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Trackbacks are On
Pingbacks are On
Refbacks are Off


ManagementParadise.com is not responsible for the views and opinion of the posters. The posters and only posters shall be liable for any copyright infringement.



Search Engine Optimization by vBSEO ©2011, Crawlability, Inc.