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T
I
M
E
S
A TIME COMMUNICATIONS PUBLICATION
VOL. XVII No. 38
Monday, August 4 - 10, 2008
Pages 19
Better participation needed
for unfolding of a sustainable rally
By Sanjay R. Bhatia
The markets have moved in a rangebound trend amidst occasional bouts of volatility and choppiness due to the expiry in
the derivatives segment. Selling pressure and profit booking surfaced at higher levels as the markets continued to lack
confidence at these levels. Traders and speculators were seen buying at lower levels but were quick to book profits and go
short at higher levels. Incidentally, FIIs remained net sellers in the cash segment but were net buyers in the derivatives
segment. Mutual Funds, however, remained net buyers
during the week.
The global cues have remained mixed. Crude oil prices
remained volatile but continued to correct and fell around
the $120 per barrel level but soon bounced back to around
$123 level. The US economy continued to display a negative
picture. On the domestic front, inflation moved higher to
rise to 11.98% for the week ended 19 July 2008. In the
monetary policy, the RBI continued to take measures to
arrest the rising inflation. The RBI raised the Repo Rate by
50 basis points (bps) to 9% with immediate effect and CRR
by 25 bps. The earnings season has come to an end with no
surprises. The markets lack domestic triggers except for the
monsoon, which so far have not been upto expectations.
The markets would continue to take cues from the global
markets, crude prices and of course the inflation rate. Stock specific action will be witnessed. However, it is now
important that the participation increases. The markets continued to witness lower volumes on days with positive closing
and higher volumes on days with a negative close, which indicates lack of confidence and tentative sentiment at higher
levels. It is important that the markets witness improvement in participation for any sustainable rally to unfold.
On the upside, the Sensex faces resistance at the 14677 and 15000 levels but has support at the 14141 and 13989 levels. On
the upside, the Nifty faces resistance at the 4482 and 4647 levels whereas 4108 and 4074 are its important support levels.
Investors can buy Network 18 with a stop loss of Rs.150 and a target price of Rs.210.
Can the rise be sustained?
TRADING ON TECHNICALS
By Hitendra Vasudeo
1
Last week, the Sensex opened at 14267.03, fell to a low of 13727.15 climbed up to a high of 14682.33 before finally closing
the week at 14656.69 and thereby recorded a net rise of 381.75 points on week-to-week basis. It proved to be a good week
with volatility and indecisive price behavior on daily chart. The most important phenomenon last week was the island
reversal like area or the gap in an isolated area that got covered. Few important hurdles on the daily chart were crossed
and the close was also above the gap of 14484-14608 on Friday.
As per the daily chart observations, the next resistance will be at 15130-15259-15422. These resistances will be tested
during the week. If we see a further close above 15422, then we can look for a pull-back of the fall from 21206 to 12514.
The 0.382, 0.500 and 0.618 levels are placed at 15838-16834-17892. Depending on the momentum and sustainibilty, each of
these levels will be focused on turn by turn. If the Sensex does not violate the support zone of 14369-14002-13727, then we
can look for a spike to 15838 with the intermediate resistance at 15130-15259-15422. The trend-line on the daily chart taken
from the two points 21206 and 17497 is placed in the range of 15259-15422. A rise and close above 15422 will also mean a
trend line breakout. Will it do it? Can it? And can it sustain it is the issue and the big question.
Sensex Wave Analysis
Wave I- 2594 to 3758
Wave II- 3758 to 2828
Wave III- 2828 to 21206 (not yet complete)
Internals of Wave III
Wave 1- 2828 to 6249
Wave 2- 6249 to 4227
Wave 3-4227 to 21206
Wave 4- 21206 to 12514
Wave 5- 12514 to 15130 (valid till 13727 is not violated)
If that holds then the logical target can be 17964-20568, which
is the 5
th
Wave failure range targets.
Normal Count
Wave I-2594 to 3758
Wave II-3758 to 2904
Wave III- Internals as
follows:
WEEKLY UP TREND STOCKS
Wave 1- 2904 to 6249
Wave 2-6249 to 4227
Wave 3-4227 to 12671
Wave IV- 12671 to 8799
Wave V- 8799 to 21206
Wave W-21206 to 14677
Wave X-14677 to 17735
Wave Y- 17735 to 12514
Wave X- 12514 to 15130
(current ongoing move)
As a result of another
Wave X, we are getting
into a Triple Zig-Zag
formation. The moment
Wave X gets complete, it
can fall back below 12514
to complete Wave Z.
Wave X can stretch to the
0.382 retracement level of
the fall from 21206 to
12514, which is placed at
15838. If it exceeds 15838,
then the count will not be
valid. If that happens,
then we could be looking
at
an alternate Flat
pattern Wave B that can
stretch beyond 0.618
levels of 17892.
Let the price move below Center Point or Level 2 and when it move back above Center Point or Level 2 then buy
with what ever low registered below Center Point or Level 2 as the stop loss. After buying if the price moves to
Level 3 or above then look to book profits as the opportunity arises. If the close is below Weekly Reversal Value
then the trend will change from Up Trend to Down Trend. Check on Friday after 3.pm to confirm weekly reversal
of the up Trend.
Last
Center
Relative
Weekly
Up
Close
Point
Strength Reversal Trend
Scrips
Level 1 Level 2
Level 3 Level 4
Value
Date
Stop
Loss
Buy
Price
Buy
Price
Book
Profit
Book
Profit
LUPIN
741.00
674.0
716.0
733.0
758.0
800.0
72.8
709.3
11/07/08
STERLING INT'L
333.05
238.8
296.7
318.3
354.7
412.6
71.0
279.6
25/07/08
JAYBHARAT TEX.
257.40
248.7
254.4
257.0
260.1
265.8
67.9
252.4
18/07/08
UNITED PHOSPH
349.70
281.9
322.8
336.9
363.8
404.7
67.1
313.1
18/07/08
SUN PHARMA.
1449.00 1291.7
1387.7
1422.3
1483.7
1579.7
66.9
1369.5
25/07/08
WEEKLY DOWN TREND STOCKS
Another overall Count
Structure can be as
follows:
Let the price move above Center Point or Level 3 and when it move back below Center Point or Level 3 then sell
with what ever high registered above Center Point or Level 3 as the stop loss. After selling if the prices moves to
Level 2 or below then look to cover short positions as the opportunity arises. If the close is above Weekly Reversal
Value then the trend will change from Down Trend to Up Trend. Check on Friday after 3.pm to confirm weekly
reversal of the Down Trend.
Last
Center
Relative
Weekly Down
Close
Point
Strength Reversal Trend
Scrips
Level 1 Level 2
Level 3 Level 4
Value
Date
Cover
Short
Cover
Short
Sell
Price
Sell
Price
Stop
Loss
OMAXE
125.05
101.7
116.1
121.6
130.5
144.9
21.22
125.25
09/05/08
MOSER/BAER IND
90.55
71.1
85.0
93.4
98.9
112.8
21.92
96.24
30/05/08
GAMMON INDIA
201.40
167.6
192.7
209.2
217.9
243.0
22.53
211.73
13/06/08
BAJAJ HOLDING
343.75
264.3
320.8
354.4
377.3
433.8
23.97
394.52
18/07/08
ABAN OFFSHORES 2511.00 2125.7
2400.7
2565.3
2675.7
2950.7
36.58
2680.00 1/8/2008
2
Wave I- 2594 to 3758
PUNTER'S PICKS
Wave II- 3758 to 2828
Wave III- 2828 to 21206
Internal of Wave III
Wave 1-2828 to 3416
Wave 2- 3416 to 2904
Wave 3-2904 to 6249
Wave 4- 6249 to 4228
5
th
Wave in Extension
Wave 5 from 4228 to
21206
Internals of Wave 5
Wave i- 4228 to 6954
Wave ii-6954 to 6069
Wave iii-6069 to 12671
Wave iv- 12671 to 12316
Internals of Wave iv
Wave a- 12671 to 8799
Wave b-8799 to 14723
Wave c- 14723 to 12316
Wave v- 12316 to 21206
Wave IV- 21206 to 12514
(current ongoing move -
Above 15130 will confirm
the low of 12514 as the
bottom and Wave V
could begin). If Wave V
gets confirmed and established, then a rally towards 17892-20596 is possible.
Note: Positional trade and exit at stop loss or target which ever is earlier. Not an intra-day trade. A delivery
based trade for a possible time frame of 1-7 trading days. Exit at first target or above.
Scrips
BSE
CODE
Last
Close
Buy Price
Buy On
Rise
Stop Loss Target 1 Target 2
Risk
Reward
ANDHRA SUGAR
590062 105.55
98.00
107.65
95.00
115.5
128.1
0.94
ANDREW YULE & CO.
526173
52.15
49.00
53.45
47.00
57.4
63.9
1.03
CASTROL INDIA
500870 289.10
277.10
292.00
261.00
311.2
342.2
0.78
DCM SHRIRAM CONSOLI. 523367
62.60
61.55
72.70
58.50
81.5
95.7
4.60
GARWARE OFFSHORE
501848 194.00
185.70
210.00
175.30
231.4
266.1
2.00
GOODRICKE GROUP
500166
78.65
74.00
81.20
70.05
88.1
99.2
1.10
INSECTICIDES (INDIA)
532851
32.70
50.15
55.75
46.30
61.6
71.0
1.17
INDRAPRASTHA MED.
532150
53.35
29.05
30.80
27.50
32.8
36.1
1.22
KILITCH DRUGS (INDIA)
524500
29.90
105.00
115.00
99.10
124.8
140.7
0.91
MOSCHIP SEMICONDUC. 532407 112.60
17.00
17.60
15.70
18.8
20.7
0.62
NET 4 INDIA
532912
17.60
72.50
73.80
67.05
78.0
84.7
0.68
NUMERIC POWER SYS.
532051
73.55
613.00
692.00
583.15
759.3
868.1
2.23
ORIENT PAPER AND IND 502420 637.60
37.50
41.00
36.25
43.9
48.7
0.97
SAAG RR INFRA.
531374
40.15
50.30
54.15
46.00
59.2
67.3
1.03
SANGHI INDUSTRIES
526521
52.50
57.05
58.50
53.50
61.6
66.6
0.78
TEXMACO
505400
58.05
1252.00
1330.00
1175.00
1425.8 1580.8
1.48
TOURISM FINANCE CORP 526650 1276.00
18.70
19.25
18.10
20.0
21.1
1.19
WALCHAND PEOPLE
501370
18.95
2181.00
2330.00
2051.00
2502.4 2781.4
1.15
Conclusion
The immediate focus is for a rise towards 15130-15259-15422-15838. Till the higher bottom of 13727 is not violated, we will
be in contention for a jerk towards 15130-15259-15422, which will be conquered step by step. It now depends on which
hurdle it fails to sustain.
Strategy for the week
Traders who trade in long trades got some relief by last week's movements. Looking at weekly candle movement, traders
can buy at 14355-14028-13727 with a stop loss of 13581. After buying, book profit at 14983-15130- 15259-15422-15838 as the
opportunity arises. Overall, the broad outlook is to exit long positions on a rally to 15838 or above retracement level as
and when the opportunity arises.
* Technocraft Industries' net profit jumped 50% in Q1FY09 at Rs.10.5 cr. recording an EPS of Rs.18. The share is going
cheap with a strong book value of Rs.116 and can cross the Rs.75 mark.
TOWER TALK
* Insecticides India with Q1FY09 EPS of Rs.4.9 is reportedly faring well. Post expansion, EPS may touch Rs.30 in FY10.
Marketmen target a share price of Rs.75.
* Jindal Photo has entered a JV with Tata Power & Monnet Ispat Energy for captive mining of coal from Mandakini non-
coking coal block in Orissa for its subsidiary Jindal India Power's 1200 MW power plant in Chhatisgarh. The share is
heading towards Rs.175.
* After acquisition of Kusha Inc in USA, LT Overseas has posted Q1FY09 EPS of Rs.7. With a likely EPS of Rs.25 in FY09,
the share at a P/E of 2.4 is attractive for the medium-term.
* Godawari Power has received approval for mining of Iron Ore in Ari Dongri Mines in Chhattisgarh and is all set to post
an EPS of Rs.65 based on the Q1FY09 results. The share is all set to touch Rs.300.
* Visaka Industries, which posted Q1FY09 EPS of Rs.9, is betting big on the demand of asbestos cement and is all set to
garner an EPS of Rs.28 in FY09. It a value buy available at a discount to its book value of Rs.100.
* With a likely EPS of over Rs.40 in FY09, the Tulsyan NEC share is are going cheap. Market grapevine projects the share
at Rs.150 in 3-6 months.
* Austin Engineering has posted 50% higher net profit in Q1FY09. With likely EPS of Rs.24 in FY09, the share is going
cheap at a P/E of 3.
3
* The shares of Kamanwala Housing, which has come off its high of Rs.229, are worth buying with 1:1 cum bonus. The
EPS of Rs.43 gives a P/E of just 2.2.
* Ajanta Pharma is a safe pharma bet and is all set to post an EPS of Rs.25 in FY09 given its expansion plans. It is an
excellent pick at a P/E of 3.
* With a likely EPS of Rs.45 in FY09, the shares of Surya Pharma are an excellent buy. It posted an EPS of Rs.32 in FY08.
* GM Breweries, which recorded an EPS of Rs.16, is available at a P/E of 4.6 against industry P/E of 35. A safe bet for the
medium-term.
* LIC Housing Finance's net profit has shot up by over 120% in Q1FY09. With a likely EPS of Rs.60 in FY09, the share can
touch Rs.350 in the short-term.
* Polyplex Corporation with a consolidated EPS of Rs.52 in FY08 is faring well. Post expansion, its EPS could increase to
Rs.68 in FY09 and Rs.80 in FY10. The share is available dirt cheap with a forward P/E of just 2.6 on FY09E and 2.2 on
FY10E.
* Som Distilleries counter is going strong on robust Q4FY08 results. Post expansion of Rs.55 cr., its EPS for FY09 may
touch Rs.9/10 and the share can double in the medium-term.
* Sandur Manganese has posted an EPS of over Rs.70 in the June 2008 quarter. With manganese prices firming up
globally, the company may be able to sustain earnings in coming days.
* Unitech at Rs.160 level is considered a good bargain as the company has posted good Q1FY09 results above market
expectations.
* The Ranbaxy counter was witnessing investor apprehension about the open offer. But with the US agencies
withdrawing the probe the open offer is likely to sail through providing a good opportunity to acquire shares at lower
cost after tendering in the open offer.
* I-flex Solutions has posted good growth oriented Q1 numbers. With delisting possibilities gaining ground, there is
increased interest in this stock.
* Both HBL Power and Numeric Power have come out with excellent results for the June 2008 quarter. Yet there is no
significant movement in their share prices. Keep accumulating these solid picks at current levels.
* Torrent Cable has reported a drastic fall in operating profit for the June 2008 quarter. Scrip may drift lower to hit new
highs later. Exit now and buy later.
* Net foreign inflow of Aftek Ltd. is very low as it is not much affected either by the appreciation or depreciation of the
rupee. Besides, it has an embedded value in the form of indirect stake in Seekport. A risk-free bet.
* Due to heavy advertising expenses, Spice Mobile reported a net loss. Investors should exit immediately and wait for the
next two quarters to get the real picture.
By Saarthi
BEST BETS
Graphite India Ltd. (Code: 509488)
Rs.59.50
Incorporated in 1963, Graphite India Ltd. (GIL) is part of the Bangur Group of Kolkata and is among the few global
players manufacturing and supplying graphite electrodes to leading steel makers worldwide. Presently, GIL produces
nearly 8% of the total global graphite output and exports around 65% of its production to 150 overseas customers in 50
countries. The company faces little competition as its closely guarded technology acts as an entry barrier. There are only
two producers of graphite electrodes with HEG being the other company. Graphite electrodes are used in electric arc
furnaces (EAF) in steel mills and is a consumable item for the steel industry. Apart from the strong global demand, the
Indian steel policy has set a higher target of 150 million metric tonnes (MMTA) steel production by 2015 and most major
steel producers are expanding capacities. Importantly, the EAF is replacing the blast furnace route due to its economic
advantage and other benefits. Thus the demand for Graphite Electrodes is robust and GIL is well positioned to leverage
this growth cycle.
As of today, GIL has a total electrode capacity of 78,000 MTA spread over its four plants at Durgapur (34,000 MTPA),
Bangalore (12,000 MTPA), Nashik (14,000 MTPA) and Germany (18,000 MTPA). The loss making plant in Germany it
acquired in 2004 is now running profitably under its leadership. To cater to the rising demand for graphite electrode, GIL
is increasing the graphite electrodes capacity by 10,500 tonnes at Durgapur to be operational by FY09 end. Importantly,
GIL has backward integrated by putting up a 30,000 MTPA calcined petroleum coke (CPC) facility. It has installed a 33
MW power generation through Hydel and Multi-fuel routes and has invested in an exclusive transmission line to obtain
low cost power for one of its plants. Further, it is contemplating to enhance its captive power generation capacity by 100
MW over the next two years.
Apart from the core activity of manufacturing graphite electrodes which contributes 85% of revenues, GIL also has
following three divisions:
4
• Graphite Equipent Division (5%): The Impervious Graphite Equipment (IGE) division is engaged in manufacturing
and marketing of heat exchangers, ejectors, pumps and turnkey plants at Nashik. These equipments have wide
application in corrosive chemicals industries such as pharmaceutical, agro-chemicals, chloro alkali and fertilizer
industries.
• Coke Division (5%): This division in Barauni manufactures CPC (aluminium & graphite both), electrode paste and
tamping paste. CPC is a raw material used in the manufacture of regular and high power grade graphite electrodes
and Impervious Graphite Equipment. Electrode Paste is used in ferro alloy smelters and Tamping Paste is used as a
lining material in steel and aluminium smelters.
• GRP PIPES & TANKS (5%): This division is engaged in manufacturing and marketing of GRP Pipes and Tanks. It
converts users of conventional pipes to GRP through re-engineering, strategic marketing, superior product quality,
competitive pricing and value added services.
Financially, the company is doing extremely well. For FY08, it reported 30% growth in sales to Rs.1099 cr. whereas PAT
increased by 40% to Rs.133.65 cr. posting an EPS of almost Rs.9 on its equity of Rs.30.20 cr. having face value as Rs.2 per
share. On a consolidated basis, it reported an EPS of Rs.10 and declared a dividend of 150% (i.e. Rs.3 per share) which
gives a yield of more than 5% at CMP. Earlier in October 2005, the company raised nearly Rs.175 cr. through the FCCB
route, which is yet to be fully converted at Rs.55 per share. It reported satisfactory results for Q1FY08 although it was hit
by forex loss to the tune of Rs.5 cr. and is expected to end FY09 with consolidated sales of Rs.1500 cr. and consolidated
profit of Rs.155 cr. This works out to an EPS of Rs.9 on its fully diluted equity of around Rs.36 cr. Considering the current
market sentiment, investors can accumulate this scrip at declines with a price target of Rs.75 in 9-12 months.
Bharat Gears Ltd. (Code: 505688)
Rs.41.25
Incorporated in 1971, Bharat Gears Ltd. (BGL) belonging to well known Raunaq group, is a major global supplier of
automotive gears and heat treatment furnaces. It manufactures a wide range of ring gears and pinions, transmission gears
and shafts, differential gears, gear boxes mostly for the automotive industry. It is a leader in India for the supply of gear
components for heavy medium commercial vehicles, utility vehicles and tractors. Its product profile includes
hypoid/spiral gears, bevel, straight bevel and transmission gears, complete automotive transmissions, gearbox sub-
assemblies, differential assemblies to name a few. On the other hand, its furnace division which hardly has any
production now, builds a variety of furnaces such as sealed quench, continuous gas carburisers, rotary hearths etc and
even constructs its own tailor made furnaces to manufacture of its own products. Currently, the company derives around
15% revenue from exports to Europe, China, USA and the Middle East. BGL's customers include almost all the
automobile players like Tata Motors, M&M, Ashok Leyland, Bajaj Auto, TAFE, Escorts, Hero Motors, VST Tractors,
Hindustan Motors, BEML, JC from India while Dana Corporation, TDI & Eaton (USA), ZG Group and the John Deere
group are among its global customers.
BGL's modern manufacturing facilities are located at Mumbra near Mumbai and Faridabad near Delhi. Earlier the
company had technical cum financial collaboration with ZF Friedrichshafen AG of Germany, which got over a couple of
years back. The Indian promoters hold 52% stake. But over the years, BGL has developed the technical excellence to
manufacture a variety of automotive gears both for
domestic and export consumption. Today, it is
internationally recognized for its cutting edge
technology, established quality processes and
capabilities. OEMs and exports account for around
80% of its customer portfolio while the balance is
from the replacement market. Incidentally, the
opportunities in India are attracting major global
OEMs as they have started sourcing components
from Indian manufacturers. Further, existing Indian
OEMs have stepped up operations to cater to
domestic and export requirements. This augurs well
for the company. Moreover, as part of regular
upgradation of technology, induction of new state of
art equipment to maintain global competitiveness
and renovation of critical equipment, BGL has
chalked out a capex plan of Rs.35 cr. for FY09. This
will be funded partly by a term loan of Rs.14 cr. and
the balance from internal accruals.
As the Indian auto industry, especially the
5
commercial vehicles tractor segment is expected to continue its growth momentum, BGL is expected to do well in coming
years. Although no spectacular growth is anticipated by the company, it can still report a healthy double digit growth. In
fact for Q1FY09, it registered 30% growth in topline to Rs.65 cr. whereas net profit shot up 160% to Rs.3.20 cr. posting an
EPS of Rs.4 for the single quarter. Even in FY08, it reported 20% and 15% growth in sales and net profit respectively.
Importantly, it declared 10% dividend and returned to the dividend list after a gap of 7 years. Because of its rich
experience of nearly four decades, the company is able to protect its profit margin despite rising input costs and pressure
from OEMs at the same time. Accordingly, it may maintain its sales of Rs.250 cr. with PAT of Rs.10 cr. for FY09 i.e. an EPS
of Rs.13 on its current equity. With its gross block of Rs.180 cr. and reserves of Rs.35 cr., the scrip is trading cheap at
market cap of just Rs.30 cr. or at an EV of merely Rs.80 cr. Investors can buy it as a contrarian scrip which can give 50%
return in 9-12 months.
Balaji Amines Ltd.: For the medium-term
ANALYSIS
By Devdas Mogili
Balaji Amines Ltd. (BAL) is a 20-year old Solapur (Maharashtra), based company established in 1988. The company is a
leading manufacturer of ethyl and methyl amines, which have various applications in chemical industries. It has now
diversified into producing derivatives of methyl and ethyl amines viz. dimethyl amine hydrochloride, choline chloride,
dimethyl acetamide, etc. M.R. Krishnaiah is the chairman while A. Prathap Reddy is the managing director of the
company.
BAL is one of the leading manufacturers of speciality chemicals i.e. Aliphatic Amine and its derivatives. Its plant is
located at Tamalwadi village, Tuljapur taluka, Osmanabad District in Maharashtra.
The company's products find application in growth oriented industries across the globe like pharmaceuticals, agro
chemicals, water treatment chemicals, rubber chemicals, refineries and photography chemicals etc.
R&D: BAL has an R&D centre at Osmanabad, Maharashtra. Its Unit-II is located at Hyderabad, which is focused on
natural products and is a Government of India approved R&D centre.
The company successfully commenced the commercial operation of its main plant for Ethyl Amines from June 1997.
Expansion programmes have been taken up for value-added products like Choline Chloride, DMAE-HCI and other
intermediates.
Clientele: The company has a list of reputed clientele, which include companies like IDI, Rallis, Ion Exchange, TTK
Healthcare etc.
Performance: BAL has reported net sales of Rs.217.82 cr. with a net profit of Rs.13.26 cr. netting an EPS of Rs.20.46 for
FY08.
Financial Highlights:
(Rs. in lakh)
Latest Results: The company has registered very
impressive results for Q1FY09. It clocked a net
sales income of Rs.73.08 cr. with net profit of
Rs.5.15 cr. recording a basic/diluted EPS of
Rs.7.95. The annualised EPS works out to Rs.31.80.
The company has reported all round
improvement in profitability margins.
6
Financials: BAL has an equity base of Rs.6.48 cr.
with reserves of Rs.71.32 cr. and the book value of
the share works out to Rs.120. It has a debt:equity
ratio of 1.57 and RoNW of 26.91% and RoCE
22.39%.
Dividends: The company has been paying
dividends as shown below:
FY07 - 15%, FY06 - 50%, FY05 - 30%, FY04 - 30%,
FY03 - 25%.
The company last issued bonus shares in the ratio
of 1:1 during 2006.
Share Profile: The company's shares with a face
value of Rs.10 are listed and traded on the BSE
under the B group. Its share price touched a 52-week high/low of Rs.240/Rs.86. At its current market price of Rs.116.75, it
has a market capitalisation of Rs.78 cr. The share has a beta value of 0.7, which indicates comparatively low volatility.
Particulars
Q1FY09
Q1FY08
FY08
Gross Sales
7787.62
5300.27
23967.65
Less: Excise Duty
480.04
382.08
2185.7
Net Sales/Income from operations
7307.58
4918.19
21781.95
Other Income
93.04
24.25
92.51
Total Income
7400.62
4942.44
21874.46
Total Expenditure
6326.66
4331.37
18802.05
a. Inc/Dec in Stock
217.32
380.09
939.14
b. Raw Materials
4759.02
2845.21
12569.36
c. Staff Cost
117.31
88.85
630
d. Power & Fuel
473.48
333.67
1736.51
e. Other Expenditure
759.53
683.55
2927.04
Interest
213.59
175.99
791.79
Gross Profit before Dep & Tax
860.37
435.08
2280.62
Depreciation
118.99
101.84
440.08
Profit Before Tax
741.38
333.24
1840.54
Prior period items
0
0
25.4
Prov for current taxation
80.75
25
227
Profit after current tax
660.63
308.24
1638.94
Deferred tax expense
145.50
0
312.86
Net Profit
515.13
308.24
1326.08
Paid up equity share capital
648.02
648.02
648.02
Res Exc Rev Reserves
7131.53
4129.93
6502.59
Basic/Diluted EPS (Rs)
7.95
4.75
20.46
Shareholding Pattern: The promoters holding in BAL is 54.26% while the balance of 45.73% is with the non-corporate
promoters and the Indian Public.
Prospects: The outlook for margins and profitability depends greatly upon the overall global economic outlook, the
industry demand supply scenario and the trends in feedback and product prices.
Conclusion: BAL is an existing, profit making and dividend paying company with a good track record.
At its current market price of Rs.116.75, the share price is discounted less than 4 times against the industry average P/E
multiple of around 13. Considering its impressive performance, good track record and low P/E multiple, the share could
be added to one's portfolio with a medium-to-long-term perspective.
The market may be rangebound
MARKET REVIEW
By Ashok D. Singh
The BSE Sensex added 381.75 points or 2.67% to close at 14,656.69 for the week ended 1 August 2008. The Nifty rose 101.7
points or 2.35% to end at 4413.55. The market shrugged off the interest rate hike by the RBI on Tuesday, 29 July 2008.
Strong bounce back in global markets and further decline in oil prices revitalized the market sentiment last week.
The BSE Mid-Cap index rose 70.15 points or 1.26% to 5,642.74 and the BSE Small-Cap index rose 201.32 points or 2.96% to
6,980.10.
The wholesale price index rose 11.98% in 12 months to 19 July 2008, above the previous week's annual rise of 11.89%.
Inflation for the week ended 24 May 2008 was revised upwards to 8.9% from 8.24%. To curtail the surging inflation and
inflationary pressures, the RBI on 29 July 2008 tightened the liquidity in the system by raising the Cash Reserve Ratio of
banks by 25 basis points to 9% and the short-term indicative rate viz. the repo rate by 50 basis points to 9%.
The RBI also revised the GDP growth projection for 2008-09 to around 8%, from
the earlier 8% to 8.5%.
Exports rose 23.5% to $14.66 billion in June 2008 from a year earlier. This helped
narrow the trade deficit from May 2008 to $9.79 billion. Imports were up by 25.9%
to $24.45 billion in June 2008 from a year earlier. Oil imports rose 53.4% to $9.03
billion.
FIIs sold shares worth Rs.1836.80 cr. in July 2008 and worth Rs.26705.10 cr. in the
calendar year 2008. Mutual funds bought shares worth Rs.1223.50 cr. in the month
of July 2008 till 30 July 2008.
The key benchmark indices scored marginal gains on Monday, 28 July 2008.
However, trade was cautious ahead of the RBI's monetary policy review scheduled
the next day. The BSE Sensex gained 74.17 points or 0.52% higher to end at
14,349.11. The broad based NSE Nifty rose 20.25 points or 0.47% to close at
4,332.10.
The benchmark indices slumped sharply on Tuesday, 29 July 2008 after the RBI on
that day raised CRR by 25 bps and repo rate by 50 bps in its quarterly monetary
policy review. The BSE Sensex plunged 557.57 points or 3.89% at 13,791.54. The
broader based NSE Nifty was down by 142.25 points or 3.28% to end at 4,189.85.
Rally in global equities and fall in oil prices aided a rebound on the domestic
bourses on Wednesday, 30 July 2008. The BSE Sensex jumped 495.67 points or
3.59% at 14,287.21. The broader based NSE Nifty jumped 123.70 points or 2.95% at
4,313.55.
On Tuesday, 31 July 2008, the key benchmark indices extended the previous
session's sharp gains ending marginally higher amidst volatility as F&O contracts
for July 2008 series expired that day. The BSE Sensex rose 68.54 points or 0.48% at
14,355.75. The broader based NSE Nifty was up 19.40 points or 0.45% to 4,332.95.
On Friday, 1 August 2008, the market, which had opened weak on subdued global
cues completely changed the course ending near the day's high. The rally gathered
steam in late trades after United Nations nuclear watchdog chief, Mohamed
ElBaradei, said a basic inspection plan for India met all safeguards standards.
Members of IAEA's board of governors will be voting on the India-specific nuclear
safeguard agreement, a key step in operationalisation of Indo-US nuclear deal. The
BSE Sensex surged 300.94 points or 2.10% at 14,656.69. The broader based NSE
Nifty rose 80.6 points or 1.86% to close at 4413.55.
Reliance Industries rose 7.10% to Rs.2299.75 for the week. Reliance
7
Communications (RCom) tanked 13.18% to Rs.436.80 in the week after the reported the slowest profit growth in nine
quarters. RCom reported 23.9% growth in consolidated net profit to Rs.1512 cr. on 23.7% growth in revenue to Rs.5322 cr.
in Q1FY09 over Q1FY08.
ICICI Bank fell 2.25% to Rs.642.10. The bank's net profit declined 6.1% to Rs.728.01 cr. on a 1.6% growth in operating
income to Rs.9429.98 cr. in Q1FY09 over Q1FY08. Treasury losses and slower growth in advances have taken a toll on
ICICI Bank's profits for Q1FY09.
The Sensex gained 381.75 points to close at 14,656.69 last week. With the Q1FY09 earnings season over, there is no major
near term trigger for the domestic bourses. The market will now closely watch the movement in crude oil prices and
global stock markets. Stubbornly high inflation, however, still remains a concern.
8
Bulls begin to takeover
MARKET
By G. S. Roongta
The week ended Friday, 1 August 2008, was volatile as anticipated and indicated in the last issue under the headline 'Stay
invested even as market remains volatile'. This headline was a positive indication to avail of the opportunity and pick up
quality shares during the downside volatility.
Last week on Tuesday, 29 July 2008, the market provided such a grand opportunity as the bears tried
their best to beat the market down again on the back of fears created by a likely hike in the Prime
Lending Rate (PLR), Cash Reserve Ratio (CRR) and the Repo Rates by the Monetary Policy scheduled to
be announced that day by the RBI Governor, Dr. Y. V. Reddy.
A bitter pill was certainly expected as the government is more keen to fight inflation even at the cost of
growth. The RBI Governor's comfort level on inflation is 5-7% as against the 12% raging now. Dr. Y. V.
Reddy justified his stand stating "Every time we have administered the medicine, people have
complained that it is bitter. But in the end they turned out to be healthier." Hence the hike of 50 basis points (bps) in the
benchmark short-term rate from 8.5% to 9% was higher by 25 bps over market expectations of 8.75%. The CRR, too, was
hiked by 25 bps to drain out liquidity of Rs.9000 cr. from the banking system.
G.S. Roongta
These RBI policy measures took a heavy toll on intra-day trading by 622 points knocking down the BSE Sensex below the
14000 mark once again to a low of 13727.14 before it closed at 13791.54 for the day. This fall unnerved the pink papers as
one of the headlined 'Sensex gets the growth shivers' as it considered the blow so severe to knock the bulls off their feet
and indicated that the bulls wills take some more time to get back on their feet. A similar opinion was echoed by other
analysts and experts in the pink media and the TV channels as they felt that the market might test the bottom again for
the third time.
But the market countered such
pessimism the very next day as it shot
up by over 495.67 points. Thus the
market had re-rated the impact of the
rising cost in short-term borrowings
and there was a sea change in market
sentiment in just 24 hours! Money
Times readers should be convinced by
now of what I have been stating for the
past 5/6 weeks that stock prices have
been beaten down to such low levels
that there is no further scope of a fall
and they are sure to bounce back. This
has been happening time and again as
stocks bounce back every time they are
pushed below reasonable levels. This
led bear operators to question their
strategy to proceed further or cover up
their short position.
The doubts in the minds of the bears is
evident by the game in CNX Nifty
Futures, which now stands exposed
and against which this column was
perhaps the only voice. I was always
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9
in Futures.
suspicious about the rampant speculation in Nifty Futures and often wondered why the SEBI and other authorities
remained silent spectators whereas they take no time to curb heavy bull positions
The Nifty July Futures, which were quoted at a discount of 40-50 points over the past one month are now quoting at a
premium of 13 points. This indicates that the huge short position in Nifty Futures has been covered up and bears are now
beating a retreat as bulls begin to take over.
Most of the current negative factors, both domestic and global, seem to have been discounted including the political
upheavals and the bomb blasts in Bangalore and Ahmedabad. What more remains is anybody's guess but I do not foresee
any setback at the moment. The corporate results have been quite convincing and do not rule out the scope for growth.
The cost escalation due to high commodity prices and a slowdown in certain sectors may impact the profitability by 15-
20% from the peak levels but will still be good from the average growth potential point of view.
The monsoon deficit, as feared two weeks back, has been made up by the recent rainfall for a week. This will reduce the
specter of a drought and boost the prospects of a good agricultural growth in FY09, which may turn out to be another
year of record output.
Thus the downward risk or fear of a further slowdown in the economy appears to be receding and the panic created in
the stock market since the last week of January 2008 should give way to some optimism as stocks gather momentum. The
positive closing on the benchmark indices witnessed over the last 4 weeks will extend to this week also and several
leading stocks will display higher momentum. The 52-week trendline also signals an upward move as the market gains
further strength. My faith in the market has been vindicated by the movements on Friday, 1 August 2008, as the market
gained 300 points over and above the 68 points gained on Thursday, 31 July 2008.
What is, however, more significant is that this is the first time since the downfall started in the last week of January 2008
that the market, which opened with a downward gap of almost 240 points on Friday, 1 August 2008, was able to recoup
the entire loss and take a sharp u-turn to close with a handsome gain of 300 points despite weak Asian markets and
higher inflation figures.
JK Lakshmi Cement Ltd.
Last week as I had promised to resume stock recommendations, I hereby recommend cement stocks as the entire cement
sector has lost much ground of more than 60% during the recent fall as against the fall in the benchmarks by 30%.
Presented here in, JK Lakshmi Cement's fundamental review, which has lost enough steam from its high of Rs.218 to a
low of Rs.77 on 31 July 2008. It is a good buy at the current level to reap a good harvest of 40-50% in the next 8-10 months
in relation to the yield in other assets such as bonds, mutual funds, fixed deposits or gold.
Financials:
(Rs. in cr.)
Cement Production: JK Lakshmi Cement has enhanced its installed
capacity to 3.65 million tonnes over the last few years and has
produced 34,22,025 tonnes of cement in FY08 while selling more than
it produced at 36,48,995, which speaks about the robust demand of its
produce.
Expansion Plans: Having stabilized its recently increased capacity of
3.65 million tonnes, the new 1.10 million tonnes capacity expansion is
underway, which will take its total installed capacity to 4.75 million
tonnes. The commercial production will start well before the end of
this fiscal.
A greenfield composite cement plant at Durg in Chattisgarh with
annual capacity of 2.7 million tonnes is also being envisaged.
Particulars
FY08
Income
1114
Profit before Interest & Dep.
358
Interest
28
Depreciation
58
Profit Before Tax
272
Taxation
27
Extraordinary Items
21
Profit After Tax
224
Equity Capital
61
Basic EPS (Rs.)
53
Basic EPS after Extraordinary Items (Rs.)
39
P/E Ratio (Lowest in Cement sector)
2
Market Price (01/08/2008)
78.95
Dividend: The company, which was not paying dividend for the last several years, has once again returned to the
dividend paying list having recommended a dividend of 25% for FY08. This may be hiked further to 35-40% in the current
year based on its robust earnings.
Market Price: The company's share, which had touched a high of Rs.217.60 in December 2007, has fallen by more than
65% to Rs.77, which could be considered to be the maximum fall. The company continues on its growth path despite the
slight fall in cement prices and abnormal increase in input costs such as transport and energy to the tune of 100%
compared to the previous year. Yet the company hopes to fare well as any shortfall in profit due to these reasons will be
made up by the additional capacity.
With the JK Cement share at Rs.126, JK Lakshmi Cement is going cheap as their profitability prospects are at par.
P/E Ratio: As just 2 times its FY08 earning, JK Lakshmi Cement scrip provides a golden opportunity to buy it as it is one
of the lowest discounted cement stock at the moment.
Outlook: The company's outlook is still very positive and bright with its installed capacity of nearly 5 million tonnes by
the year end as the current 1.10 million tonnes capacity will not result in any extra cost or heavy borrowings in as much as
the company made a surplus of Rs.224 cr. as net profit plus depreciation of Rs.58 cr. The company has surplus fund of
Rs.347.58 cr. as cash and bank balance as on 31 March 2008. So from all angles i.e. capacity, expansion, production,
earnings, financial strength, marketing, JK Lakshmi Cement is attractive at the current market price.
To sum up, the JK Lakshmi Cement scrip is currently discounted at a P/E multiple of just 2. With its earning capacity
intact, it should be considered a good opportunity to buy now to reap a good harvest in the days to come.
10
By Saarthi
STOCK WATCH
Once again Micro Technologies (India) Ltd. (Code: 532494) (Rs.230) has announced excellent results for Q1FY09. Total
revenue as well as net profit shot up by 65% to Rs.58 cr. and Rs.17.50 cr. respectively recording an EPS of Rs.16 in this
single quarter itself. For FY08, it had recorded an EPS of Rs.48 with net profit of Rs.53 cr. on its total revenue of Rs.171 cr.
The company is a global provider of security, safety and life-support solutions with the first of its kind and innovative
products for security of home, office, shop, vehicle, laptop, mobile etc. It also has a business agreement with MTNL as
well as Airtel to offer Lost Mobile Tracking System to their customers. Few weeks ago, it introduced a GPS based product
called 'Buddy Tracking System' to know the real time location of users. Given the current share market condition, the
company has again reduced the FCCB conversion price by 18% from Rs.304 to Rs.250. Although this indicates that both
bondholders and the company are interested in conversion, not redemption, this will lead to further equity dilution by 45
lakh shares. For FY09, it is expected to report a topline of Rs.250 cr. with bottomline of Rs.70 cr. i.e. an EPS of Rs.54 on its
fully diluted equity of Rs.13 cr. Even at modest discounting by 8 times, the share price has the potential to hit a new high
of above Rs.400 in 12-15 months.
******
Recently, Ramsarup Industries Ltd. (Code: 532690) (Rs.122) has come out with decent Q1FY09 results while sales grew
by 10% to Rs.383 cr., net profit increased by 25% to Rs.15.80 cr. on the back of better operating margins. The company
manufactures a variety of steel wires (mainly used by the power industry) and TMT Bars. To cater to the rising demand,
the company is expanding its total wire manufacturing capacities from 233,000 tonnes to 600,000 tonnes including the
production of Low Relaxation Pre-stressed Concrete (LRPC) wires over the next two years. It has acquired 60 acres of
land in West Bengal and the major plant and machinery are being imported from Italy. And to access cheaper and regular
raw material supplies, the company took over Balasore Minerals Co., which has iron ore, limestone and dolomite mines
located in neighbouring Orissa. But importantly, the company is merging its group company called 'Ramsarup Loha
Udyog', which is emerging as an integrated steel producer with captive production of sponge iron, pig iron, billets, power
etc. As no official figures are available for the group company, on a standalone basis the company is expected to clock a
turnover of Rs.1750 cr. with PAT of Rs.65 cr. for FY09. This translates into an EPS of Rs.37 on its current equity of Rs.17.50
cr. Post merger, its equity is expected to get diluted to about Rs.35 cr.
******
Gujarat Apollo Industries Ltd. (Code: 522217) (Rs.182) is into manufacturing and after sales service of road building
equipments like asphalt plants, pavers finishers, wet mix plants, bitumen sprayers, compaction equipment, road making
machineries, crushing & screening machines etc. It controls more than 60% of the market in the product segments in
which it operates. With over 1,400 customers and about 3,500 equipments. To consolidate its position, it has been
investing in associate companies and has already made Apollo Earthmovers and Apollo Industrial Products Ltd. as its
subsidiaries. Another group company called Apollo Construction Equipments Ltd. is expected to come under its fold this
fiscal. For Q1FY09, it registered a net profit of Rs.7.15 cr. on consolidated sales of Rs.61 cr. Accordingly for full FY09, it
may post an sales of Rs.280 cr. with PAT of Rs.33 cr., which works out to an EPS of Rs.30 on its diluted equity of Rs.11.05
cr. The share has the potential to move up to Rs.240 in the short-term once the sentiment improves. Accumulate at every
decline.
******
For Q1FY09, Lokesh Machines Ltd. (Code: 532740) (Rs.56) reported almost flat numbers with net profit of Rs.3.10 cr. on
sales of Rs.20.50 cr. and declared a dividend of 25%, which gives a yield of nearly 5% on CMP. Importantly, it reported a
higher operating margin of 37%, which indicates that the company may be able to maintain its profit going forward. The
company is engaged in the design, development and manufacture of custom built special purpose machines and general
purpose CNC (computerized numerical controls) machines along with their components. It derives 70% revenue from the
machining division while the rest 30% comes from its auto components division. It primarily caters to customers in the
auto OEM, auto ancillaries and general engineering space and supplies to Tata Motors, Bajaj Auto, Force Motors,
Cummins, Bharat Forge, Kirloskar Oil Engines, Everest Kanto Cylinders etc. and with separate dedicated facilities for
M&M and Ashok Leyland. Although it concentrates mainly on the domestic market, it has lately also forayed into
overseas markets with good orders. On a conservative basis, it can report sales of Rs.110 and PAT of Rs.11 cr. i.e. an EPS
of Rs.9 on its equity of Rs.11.80 cr. for FY09. At a reasonable discounting by 8 times, the share price may shoot up to Rs.75
within a year.
FIFTY FIFTY
By Kukku
Investment Call
* Andhra Sugars Ltd. (ASL) (Rs.106) was established on 11 August 1947. It manufactures and sells Sugar and Organic &
Inorganic Chemicals manufactured at its plants located at Tanuku, Kovvur, Taduvai, Saggonda and Bhimadole in Andhra
Pradesh. Non-conventional wind energy is generated at Ramagiri in Andhra Pradesh and at Veeranam in Tirnulvelli
District of Tamil Nadu. Of these, Sugar and Caustic Soda are the major product segments.
Sugar is manufactured at a 5000 TCD capacity plant at Sugar Unit-I at Tanuku, a 2500 TCD capacity plant at Sugar Unit-II
at Taduvai and a 1600 TCD capacity plant at Sugar Unit-III at Bhimadole.
Molasses, which is a by-product of Sugar manufacturing, is the raw material for ASL's Alcohol plant at Tanuku, which
produces Industrial Alcohol and Ethanol. The distillery adopts the continuous process for producing Industrial Alcohol,
which is the raw material for ethanol and other organic chemicals manufactured at its chemical complex at Tanuku.
Bagasse, which is the cane residue at the sugar plants after extraction of juice, is used to fuel the co-generation of power.
Carbon dioxide, which is a by-product of fermentation at the distillery is purified and used as a raw material to produce
Salicylic Acid that is needed to manufacture Aspirin.
The company has one of the most cost efficient Caustic Soda plants in the country and uses the latest membrane cell
technology. The manufacturing cost of ASL is among the lowest in the Chlor-Alkali industry. As the company operates
two Caustic Soda units where electricity is the raw material along with salt, it is necessary to have access cheap power.
Hence the company operates a wind power unit at Ramagiri and a co-generation power plant at Taduvai.
It also has a subsidiary, JOCIL Ltd. at Dokiparru 15 kms. from Guntur, which produces Fatty Acids (67,500 TPA),
Glycerine (1,800 TPA), Soaps (25,000 TPA). This company has also commissioned a 6 MW Bio-mass based co-generation
facility. ASL has consistent dividend track record and declared 60% for FY05. ASL holds 55.02% of its equity capital with
an investment of Rs.4.41 cr.
For FY08, ASL's net profit declined 33.97% to Rs.42.36 cr. against Rs.64.15 cr. during FY07. Sales declined 19.24% to
Rs.465.30 cr. in FY08 as against Rs.576.12 cr. in FY07. The income of Rs.20.55 cr. is an extraordinary item on account of the
write back provision for diminution in the value of investment made in Andhra Petrochemicals Ltd. provided in FY02.
ASL has an equity of Rs.27.11 cr. and has declared a dividend of 50% for FY08.
The stock is recommended for buying in view of the better outlook for both caustic soda & sugar sectors.
Recently, it reported very encouraging results for Q1FY09
with sales moving up to Rs.127 cr. from Rs.95 cr. while net
profit jumped to Rs.12.2 cr. from Rs.0.34 cr. The company has
earned mainly profit from its chemical unit. With the benefit
of better prices in coming quarters, ASL is expected to report a
sharp rise in profit over the next two years. Its consolidated
results shall be still better.
11
The company is liberal in dividend distribution and the
current stock price is cum dividend while its book value is
Rs.110, which may not allow the stock to go down much.
ASL's current market cap is just Rs.266 cr. while its subsidiary,
JOCIL had market value of Rs.25 cr. in 1998 while the current
value will be much higher. ASL's investment of Rs.28 cr. in
Andhra Petrochemcials is worth Rs.49 cr. today.
Investors can safely accumulate this stock for 75-100% growth
over the next one year.
Market Guidance
* Rishi Laser (Rs.71) has proposed a resolution for Sale or
Transfer of Dodballapur (Bangalore) unit of the company into
a separate company, which will be its subsidiary. This
subsidiary will manufacture components under a MoU with
L&T Komatsu Ltd. and L&T Capital Company Ltd. will hold
26% shares in the said subsidiary.
This is a positive development for the company. Its order
position is also said to be strong and we may see a sharp
improvement in sales & profits over next few years. Investors
can accumulate this stock on dips for good long term growth.
* Net profit of TIL (Rs.368) shot up by 45% to Rs.5.72 cr. in
Q1FY09 as against Rs.3.95 cr. in Q1FY08. Sales rose 41.95% to
Rs.185.59 cr. in Q1FY09 as against Rs.130.74 cr. during Q1FY08. Though the results are encouraging but manpower cost
has flared up by 60% in this quarter while the purchase of traded items shot by almost 100% in this quarter. Investors can
continue to hold this stock.
* We had alerted that Piramal Glass (Rs.167) had very high debts. The company has reported a loss of around Rs.13 cr.
for Q1FY09 due to high interest cost of Rs.25 cr.
* Jetking (Rs.313) has added several new centres in Tier II and Tier III cities like Gorakhpur Gulbarga, Nashik and
Guwahati. The company has also planned a foothold in the East & South, which will yield better results over next few
years. Investors can accumulate this stock on dips for good long-term growth.
* Ashiana Housing's (Rs.62) Q1FY09 results are encouraging as net profit has shot up from Rs.3.8 cr. to Rs.5.5 cr. while
sales went up from Rs.15.5 cr. to Rs.20.3 cr. Long-term investors can take benefit of this sharp fall to accumulate this stock
as its projects are in II or III Tier cities for the middle income group.
* DIC India's (Rs.152) net profit rose 76% to Rs.4.59 cr. in Q1FY09 as against Rs.2.61 cr. during Q1FY08. Sales rose 18.27%
to Rs.117.62 cr. in Q1FY09 as against Rs.99.45 cr. during Q1FY08. Its quarterly standalone EPS is around Rs.5. The
company has not declared consolidated results for the first two quarters. If the current performance is any indication, then
full year consolidated EPS may be above Rs.25. Investors can accumulate this stock on dips as a safe investment for good
long-term growth.
* Results of Impex Ferro Tech (Rs.32) are very encouraging as net profit shot up from just Rs.87 lakh in Q1FY08 to Rs.7.06
cr. for Q1FY09 on 42% higher sales. Full year EPS is likely to be around Rs.12/13 subject to firm product prices. Stay
invested for a target price of Rs.50.
* Net profit of Excel Industries (Rs.64) shot up to Rs.5.33 cr. in Q1FY09 as against Rs.0.94 cr. in Q1FY08. Sales rose 35% to
Rs.70.41 cr. in Q1FY09 from Rs.52.33 cr. in Q1FY08. Investors can hold on to the stock for a target price of Rs.80 over the
next few months.
* As mentioned earlier, Tata Motors, Maruti and Mahindra & Mahindra have taken a hit in profit margins. We may see a
further fall in margins in the current quarter also. Tata Motors (Rs.399) recorded Rs.316 cr. as other income in Q1FY09
without which it's net profit would have been lower.
* BEML (Rs.702) reported net loss of Rs.17.43 cr. in Q1FY09. The company is not able to pass on the increase in input
costs.
* First Leasing (Rs.44) of cum dividend 22.5% is under accumulation by knowledgeable investors. Its book value is Rs.80,
FY08 EPS was Rs.13.6 and its 52-week high/low was Rs.102/38. Its 3-year low is Rs.35.5.
* Kesar Enterprises (Rs.71) has reported highly encouraging results with net profit in Q4 flaring up to Rs.7.03 cr. against
loss of Rs.12.93 cr. during the previous corresponding period. The outlook of the company is encouraging. Accumulate on
dips. The stock has shot up from Rs.55 to Rs.71 in the last one week.
* Sakthi Sugar (Rs.100) reported encouraging results and the stock shot up from Rs.66 to Rs.100 level in less than 10 days.
The stock was recommended in this column from time to time.
* Wall Street Finance (Rs.65) - Good developments are said to be taking place. Investors can stay invested for a target
price of Rs.100.
* Elecon Engineering (Rs.89) – There are indications from a recent conference call that margins of the company shall be
maintained in the current year. Investors can keep a watch to add this stock on dips.
Note: There is lot of value buying in fundamentally strong stocks as many such stocks are available at their 2/3 years'
low. Moreover, the reaction in crude prices has supported the upmove as discussed in the last few issues.
Investors can accumulate the stocks discussed above on every dip keeping a watch on crude oil prices. Investors must
note that high crude prices and high interest rates will not stay for long.
Sugar & caustic soda stocks were discussed in this column from time to time. Most of these companies have come out
with encouraging results and these stocks flared up by 20-40% in the last few days. Stay invested in this sector for good
long-term growth.
By V. H. Dave
EXPERT EYE
Incorporated in 1976 and promoted by Ashok Jaipuria, Cosmo Films Ltd. (CFL) (Code: 508814) (Rs.95.95) is a market
leader in manufacturing & exporting of BOPP (Bi-axially Oriented Polypropylene) Films. CFL exports its products to 50
countries and has its own captive power plant of 8 MW capacity, which ensures good quality uninterrupted power
supply for its production at an economical cost.
CFL's plans of more than doubling its capacities are on track. Its first line of approx 40, 000 MT/year capacity is expected
to start production by FY09 at an investment of Rs.120 cr. It further plans to increase capacities from 56,000 MT to 1,36,000
MT of BOPP Films and 24,000 MT to 33,500 MT value add film to by fiscal 2010 making it one of the largest players in this
segment. The capacity of its high margin products like thermal metallized films is also being enhanced from 3,000 TPA to
6,600 TPA by 2009.
12
Being non-toxic and totally recyclable, this wonder thermoplastic material is also preferred for its superior moisture
retention, strength, flexibility and better optical properties that provide higher visual aesthetics.
CFL is one of the lowest cost producers of BOPP Films in the world. It produces a wide variety of BOPP Films such as
transparent, pigmented, pearlised, antifog, speciality, holography, pressure sensitive, synthetic paper films etc.
Apart from the FMCG sector being the major consumer, BOPP Films also find application in various other industries like
textile, food processing, stationery, cigarette over wraps, cosmetics, toiletries, label films, self adhesive tapes,
holography/lamination etc. Its main clients in the FMCG sector are Parle, Britannia, Hindustan Unilever, Nestle and
Dabur, which use tetrapacks and BOPP Films for packing their products.
Due to the small market size and demand-supply mismatch, the company presently exports 60% of its production. In fact,
CFL is the largest BOPP Films exporter from India supplying to over 60 countries across USA, Europe, Middle East and
other parts of Africa.
To fund its ongoing expansion, the company has allotted 31 lakh warrants to the promoter group to be converted into
equity at Rs.107 per share.
Despite the industry encountering an overcapacity scenario in the domestic and global markets, CFL has been working at
100% capacity utilisation together with regular expansions.
Because of organised retailing, increasing mall culture and higher spending capacity, the FMCG and food processing
industries is witnessing phenomenal growth and the domestic BOPP Films market growing at 15-20% p.a. However,
rising crude oil prices may affect its margins in future.
To maintain and grow its bottomline, CFL is focusing on value added growth compared to volume growth by selling
more value-added specialty products like multi-layer barrier laminates and thermal lamination films on paper based
products as their margins are better.
On the other hand, it is targeting high-end profitable markets to improve its realisation and has accordingly set up a
wholly-owned subsidiary in USA recently. Simultaneously, it has been expanding its customer base by providing cost
effective and innovative packaging solutions to its customers.
The company's profitability got a boost after repayment of long-term debts of Rs.30 cr. reducing its interest liability in
FY08 to Rs.12.8 cr. from Rs.15.2 cr. in FY07. Repayment of forex loans borrowed for earlier expansions also led to gains of
Rs.5.2 cr., which was not considered in the calculation of net profit.
During Q4FY08, CFL's net profit advanced by 53% to Rs.14.8 cr. on 5% higher sales of Rs.144 cr. During FY08, while, its
net sales grew by around 9% the net profit advanced by 64% to Rs.40.8 cr. yielding an EPS of Rs.21. A dividend of 50%
was paid. During Q1FY09, net profit advanced by 59% to Rs.14.5 cr. on 33% higher sales of Rs.186 cr. Q1EPS stands at
Rs.7.5.
Its equity capital is Rs.19.4 cr. and with reserves of Rs.161.4 cr., the book value of the share works out to Rs.93. The
promoters hold 44% in the equity capital, Foreign holding is 21%, Institutions/mutual funds hold 2%, corporate holding
of 8.5%, which leaves 24.5% with the investing public.
Although CFL has major presence in overseas markets, it does not face anti-dumping duties, since its sales are still well
below benchmark volumes. Over the next two years, it plans to decouple itself from the commodity cycle downturn in
BOPP Films by actively getting into thermal films.
The company's leadership position, integrity of its
management, massive addition to the gross block of
(now over Rs.450 cr.), expansion and demand of its
products all give good visibility to revenue &
profitability in the current year.
During FY09, CFL is likely to register sales of Rs.675
cr. and post a net profit of Rs.50.5 cr., which would
give an EPS of Rs.26.
At CMP of Rs.96, the share is trading at a P/E of 3.4
on an estimated EPS of Rs.26 for FY09. The share is
recommended with a target price of Rs.115 in the
medium-to-short-term. The 52-week high/low of its
share has been Rs.166/80.
******
The shares of Hyderabad Industries Ltd. (HIL)
(Code: 509675) (Rs.168.70) are recommended for
steady appreciation in the long-term. The share has
come off its 52-week high of Rs.337 and currently
trades at a forward P/E of 4.8 on its estimated EPS
13
of Rs.35 for FY09. The counter has been buzzing with a lot of interest from knowledgeable quarters on excellent Q1FY09
results.
HIL, a C K Birla Group company was incorporated as Hyderabad Asbestos Cement in June 1946 and was renamed HIL in
November 1985. It is into the business of producing building products, engineering goods and industrial products and
came out with its first public issue in 1946. A group company, Malabar Building Products was merged with HIL w.e.f. 1
April 2005.
HIL markets its product, asbestos cement (AC) sheets, under the well-known brand 'Charminar'. It is also the largest
manufacturer of calcium silicate, insulation blocks, pipe sections and jointing for gasketing thereby meeting the critical
needs of the fertilizer, engineering and chemical industries. It also manufactures aerocon prefab panels, which find
application in the construction of residential quarters, malls, shopping complexes etc. These products are also used in
various corporate offices for office partitioning.
It's new Fibre Cement Sheet Plant of 1, 20, 000 TPA was set up at a cost of Rs.30 cr. at Sathariya Industrial Development
Area, Jaunpur (U.P) and commenced commercial production from 3rd July 2006. This is among the most modern plants
in the country with state-of-the-art process automation and pollution control equipment. With this addition, HIL's
production capacity has risen to about 7 lakh TPA. Efforts to enhance production and productivity at the existing plants
are also continuing.
During Q1FY09, its net profit shot up by 54% to Rs.17.1 cr. on 21% higher sales of Rs.176 cr. and the EPS works out to
Rs.22.9. During FY08, HIL earned 14% lower net profit of Rs.14 cr. on 11% increased sales of Rs.483 cr. Its EPS was Rs.18.6
and dividend of 50% was paid.
HIL has a tiny equity capital of just Rs.7.5 cr. and with reserves of Rs.139 cr., the book value of the share works out to
Rs.195 making it a bonus candidate.
The promoters hold 43% in its equity capital, FIIs hold 2.5%, FIs/Mutual funds holds 8.1%, Andhra Pradesh government
holds 4.1%, non-corporate promoters hold 8.4% leaving 33.9% with the public.
HIL has acquired 20 acres of land at Balasore in Orissa and set up a sheeting plant with an initial capacity of 1,25,000 TPA.
It is also in the process setting up an Autoclaved Aerated Concrete Blocks plant in the western region. Substantial
progress has taken place in this project and commercial production is likely to start this fiscal. Coming to its future
prospects, the government's focus on rural development is likely to heighten activity in the rural housing sector, which
will lead to higher demand for asbestos-based roofing sheets in the medium-term.
Asbestos sheets are a cheaper alternative to galvanized steel
sheets. As rising steel prices have made galvanized steel sheets
more expensive, with rising income and improved standard of
living in rural areas, the demand for asbestos sheets is expected
to grow by 15% over the next 2/3 years.
Outlook for prefab structures appear extremely bright as they
are built with aerocon panels are an ideal alternative to
conventional brick-based structures for their durability and
lightweight. The demand for these products remains strong
thanks to the buoyancy in both the construction industry and
the economy.
14
With strong earnings and financials and improved industry
prospects, HIL is in a strong position to reward shareholders
with free shares. The last bonus was in 1989 in 1:1 ratio. As the
book value of the share is likely to cross the Rs.230 mark in
FY09, HIL may consider liberal bonus in the current year.
Considering the bright prospects of the cement products
industry, the company's future expansion, its leadership
position in the industry, strong financials coupled with bonus
expectations, the shares of HIL can be considered for long-term
gains.
For FY09, sales are expected to advance by 35% to Rs.650 cr. and
net profit would rise to Rs.26.5, which would give an EPS of
Rs.35.
At the CMP of Rs.169, the share is trading at a P/E of 4.8 on its
estimated EPS of Rs.35 for FY09. Investment in this share is
likely to fetch a decent appreciation of about 50% in 6-9 months.
The 52-week high/low of the share has been Rs.337/123.
******
The share of Manugraph India Ltd. (MIL) (Code: 505324) (Rs.90.25) is recommended for decent appreciation in the
medium-to-long-term gain. The leader in the manufacture of web offsets and sheet fed offset presses; MIL has recently
produced good Q1FY09 numbers and may even consider a liberal bonus in the current year.
Established in 1972 by Mr. S. M. Shah, MIL is India's largest manufacturer of web offset and sheet fed offset presses. Over
the years, it has emerged as a thriving, nimble, printing machinery enterprise due to its ability to transform itself rapidly
to meet the challenges of a highly competitive global economy and its commitment to become a supplier of choice
delighting customers with its services and products. Constant modernisation and introduction of state-of-the-art
technology has enabled it to stay ahead in the industry and surpass all expectations.
In the web offset segment, its domestic customers include The Times Of India, The Indian Express, The Statesman,
Chitralekha, Malayala Manorama, Hind Samachar, Hindustan Times, Hindu, Sandesh and Mathrubhumi. In the sheet-fed
category, MIL's clientele consists of Magna Graphics Pvt Ltd, PS Press, S T Reddier & Sons, Herneggar Offset Druck
(Austria), Benfoy Press (UK), 3E (USA), InterDruck (Belgium) and Physics Centre (Thailand).
During FY08, MIL registered 133% higher net profit of Rs.62 cr. on 15% higher sales of Rs.423 cr. yielding an EPS of
Rs.20.4 and it paid a dividend of 200%. During Q1FY09, sales have advanced by 38% to Rs.133 cr. and net profit by 30% to
Rs.16.7 cr. This Q1FY09 profit has come after incurring a foreign currency loss of Rs.4.2 cr. against foreign loans.
In its relentless efforts to meet the needs and demands of its customers, MIL has made rapid progress in the international
market. Leading publishers from South America, Europe, Middle East, Asia and the CIS countries have all invested in
MIL's presses. Its exports during FY08 stood at nearly Rs.140 cr. mainly on account of acquisitions in the US.
Seeing the opportunity in the American market, MIL has purchased Dauphin Graphics Machines Inc. in Harrisburg,
Pennsylvania, at a cost of about Rs.88 cr. and renamed it as Manugraph DGM Inc. (MDGM). The company is No. 1 in the
US market in the four page segment complementing MIL's product range.
The promoters hold 57% in its equity capital. Foreign holding is 7.4%. Mutual fund/institutions hold 14.6%, non-
corporate promoters hold 1.5% leaving 19.5% with the investing public.
In India, MIL ranks is the number one in the manufacturing and supplying of web offset presses. With a whopping 70%
market share, its presses are present in nearly all-major publication houses. With presses having speeds ranging from
35,000 – 55,000 copies per hour, it can meet their production needs efficiently. Its technical expertise and thrust towards
quality improvement are its principal strengths and owes its leadership position in printing presses to its technical
competence.
The printing industry in India has assumed growing significance during the last decade and is one of the largest and
fastest growing industries in India. More than 1,20,000 printing presses are in operation all over the country with a capital
investment of over Rs.8,000 cr. This industry provides direct employment to over 6,00,000 people and indirect
employment to another 2,00,000. It is obvious that with the growth in literacy in India, there is a commensurate rise in the
demand for various inputs in the printing industry. Also due to the printing revolution globally, the prospects for the
printing industry appear bright.
In the current fiscal, the demand for 4-page single width single circumference market, which constitutes 90% of MIL's
business, continues to remain good. The thrust on the export fronts has also resulted in creating new markets in Sweden,
Netherlands and Indonesia and expansion of business in the existing markets of CIS countries, Middle East and Latin
America. Over and above, the company holds and maintains the major market share in India with a launch of several
regional and English dailies, which continue to bring in this 4-page market.
The explosive growth in the newspaper business over the past couple of years has led to a substantial scaling up of
revenues and earnings for MIL. As the English and vernacular language papers are in the process of expanding their
footprint, the demand for the company's products are likely to remain robust.
The process of synergising its energies is in progress and the benefits thereof are visible. Endeavours to outsource
component parts from India and market Manugraph machines in North America have been already initiated.
Based on the current going, MIL is all set to
register an EPS of Rs.26 on the face value of
Rs.2 per share. On its tiny equity of just Rs.6
cr., MIL's reserves are expected to cross
Rs.285
cr., which may prompt the
management to declare handsome bonus
apart from a hefty dividend.
Currently, the shares of MIL are traded at
Rs.90 at a P/E multiple of 3.4 on its estimated
EPS of Rs.26 for FY09. Applying a reasonable
Live market intra-day calls
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15
P/E of 6, the share has all the potential to breach the Rs.150-mark in six-to-nine months yielding an absolute appreciation
of over 65%. The 52-week high/low of the share has been Rs.204/64.
16
By Nayan Patel
TECHNO FUNDA
Panama Petrochem Ltd.
BSE Code: 524820
Last Close: Rs.127.55
Panama Petrochem Ltd. is a leading manufacturer and exporter of petroleum speciality products. Its products are in great
demand by various industries like Inks & Resins, Textiles, Rubber, Pharmaceuticals, Cosmetics, Power Cables and other
industrial applications. The company has consistently provided quality services since 1975. It has four manufacturing
units at Ankleshwar (Gujarat), Daman (Union Territory), Marol (Mumbai) and Taloja (Dist. Raigadh) with state-of-the-art
technology, relevant infrastructure and storage capacities.
It has a low equity of just Rs.4.76 cr., supported by hefty reserves of above Rs.50 cr. The promoter hold 38.69% stake,
foreign investors hold 3.51%, corporate bodies hold 17.31% and the investing public holds 40.20%.
The company has posted extraordinary results for the Q1FY09. Net sales jumped 98% to Rs.98 cr., while net profit jumped
82% to Rs.7.03 cr. against Rs.3.85 cr. in Q1FY08 and posted a quarterly EPS of Rs.14.76 and the company has announced
40% dividend. The stock is available at just Rs.127 cum dividend and is traded at a P/E ratio of just 2.9.
It is very good stock for short to long term investment. Buy with stop loss of Rs.115. On the upper side, the stock will go
up to Rs.141 level in the short-term and can go up to Rs.175 in the long-term. If we apply a P/E of even 5, then also the
stock can easily go up to Rs.225 level.
Austral Coke & Projects IPO opens on 7
th
August
MONEY FOLIO
Austral Coke & Projects Ltd. (ACPL), engaged in manufacture of Low Ash Metallurgical Coke (LAM Coke) and
equipment rental, refractory and textile trading, proposes an IPO of 72,60,000 equity shares of Rs.10 each through 100%
book building process in price band of Rs.164 to Rs.196 per share. The issue opens on 7 August and closes on 13 August
2008 and will be listed on the BSE and the NSE. CARE Ltd. has assigned 'IPO Grade 2' to the issue signifying below
average fundamentals.
The object of issue is to part finance its expansion plan involving setting up a 1,50,000 TPA of LAM Coke and setting up a
8 MW captive power plant (CPP) through waste heat recovery. The project is coming up at Sindhudurga in Maharashtra.
ACPL is setting up in-house refractory unit so as to improve the quality of operations. The company may also utilise
residual funds raised for acquiring coal mines either in India or abroad and may retire high cost debt. Availability of
quality coal on regular basis is critical for running its operations successfully. It has successfully placed 27,40,000 equity
shares to Somerset India Fund at Rs.196 per share (at the upper price band) aggregating Rs.53.70 cr.
Jyothy Laboratories launches Fabric Spa
Jyothy Laboratories, among the fastest growing consumer goods company has ventured into a new business 'Fabric Spa',
a complete rejuvenating solutions for garments under its subsidiary Jyothy Fabricare Services Ltd. (JFSL) wherein it aims
to provide World Class Laundry at affordable price at your doorstep.
The new initiative is a one stop solution to pamper and rejuvenate garments at affordable prices. The services at the Spa
range from basic solutions like: Wet Wash, Dry clean, Press, folding and packing, door to door pick up and delivery. JFSL
will broadly target three segments – Super Premium, Premium and Economy. The initial cost for this new venture is
around Rs.40 cr.
To begin with, the venture would comprise of one main service station (MSS), five quick service station (QSS) and 50
collection and delivery stations (CDC). The MSS will have capacity to service 30,000 garments a day or 10 tonnes.
ING Investment Management launches first Global Commodity Equity Fund
ING Investment Management India has launched the ING Optimix Global Commodities Fund, an open ended Fund of
Funds (FoF) Scheme for long-term growth by investing in global commodity mutual funds, which invest in commodity
related securities. The scheme opened on 29 July and will close on 25 August 2008.
ING's Multi-Manager investment solution, ING OptiMix, seeks to create a portfolio of funds that offers a risk-adjusted
solution that is optimal for investors. The multi-manager investment process involves strategic and tactical asset
allocation, underlying manager selection and allocation, and ongoing monitoring and review of each of the underlying
managers. The Multi Manager FoF concept helps to reduce risk by diversification of investment styles and processes used
by various underlying managers.
Commodities are expected to continue to be driven by a strong fundamental demand from emerging economies due to
ongoing urbanization, infrastructure development and improved consumption habits of growing middle class
population.
Mastek launches new corporate brand identity with 'Prism logo'
Mastek Ltd., a leading IT solutions player with global operations in providing new technology and IP-led enterprise
solutions to insurance, government and financial service organizations worldwide, has launched its new brand identity
through the Mastek Prism Logo.
Its new brand identity symbolises a high-end speciality in building IT applications that enable and empower customers in
their business innovation and transformation initiatives.
Rolta Announces acquires WhittmanHart Consulting, USA
Rolta India Ltd., a leading IT company, has signed an agreement to acquire WhittmanHart Consulting (WHC) , the
Consulting Division of WhittmanHart Inc., a premier Chicago based company providing value driven solutions in digital
communications, process improvement, and enabling technologies for over 20 years.
WHC is a management and technology consulting services firm that delivers solutions with a unique blend of industry
relevance, business process innovation and technology expertise. The company is recognized today as an industry
leading provider of consulting services in the Business Intelligence (BI) arena, particularly focused on the Hyperion
software technology acquired by Oracle Corporation in 2007. WhittmanHart, Inc. will retain and continue to operate
WhittmanHart Interactive, its leading interactive agency, in a standalone capacity.
Persistent Systems plans IPO
Persistent Systems Ltd., a leading technology company providing software product development services, plans to enter
the capital market with a public issue of 4,974,836 equity shares of Rs.10 each for cash at a price to be decided through a
100% book building process.
The funds are proposed to be used for expansion of its facilities at Hinjewadi in Pune and Nagpur, investments in
hardware and software infrastructure and setting up a SEZ unit in Hyderabad through its subsidiary.
Sujana Towers FY08 net at Rs.15.14 cr.
CORPORATE RESULTS
Sujana Towers Ltd., a part of well-diversified Rs.3,000 cr. Hyderabad
based Sujana Group, has recorded a net profit of Rs.15.14 cr. for the
quarter ended 30 June 2008 on net sales of Rs.164.56 cr. The EPS for
the quarter was Rs.3.66.
The results of the previous corresponding quarter is not given, as the
company emerged by way of demerger of Sujana Metal Products
Ltd. pursuant to the scheme of arrangement and amalgamation as
approved by High Court on 10 April 2007, which came into effect
from 4 May 2007.
For the year ended 30 June 2008, it posted sales of Rs.617.54 with net
profit of Es.51.57 cr. recording an EPS of Rs.11.60.
IRB Q1 Net up by 71.20% at Rs.54.17 cr.
IRB Infrastructure Developers Ltd., one of the largest toll road
operating company in India, reported a consolidated Net Profit at
Rs.54.17 cr. for the quarter ended 30 June 2008.
Its PAT for the quarter was Rs.54.17 cr. as against Rs.126.57 cr. for
full FY08, which amounts to an increase of 71.20% on a quarterly
basis. The company's total income for Q1FY09 was Rs.235.91 cr. as
against Rs.784.73 cr. for FY08.
The fully diluted EPS for the quarter stands at Rs.1.63.
Sujana Metal Products net up by 570.78%
Sujana Metal Products Ltd. (SMPL), a part of the diversified Rs.3,000
cr. Hyderabad based Sujana Group, has registered an impressive
570.78% rise in net profit at Rs.20.65 cr. for the quarter ended 30 June
2008 against Rs.3.08 cr. in the previous corresponding period. Net
sales for the quarter rose by 94.67 % to Rs.422.29 cr. from Rs.216.93
17
cr. in the previous corresponding period.
For the year ending 30 June 2008, it reported a rise of 111.99% higher net profit at Rs.48.61 cr. against Rs.22.93 cr. in the
previous fiscal. Net sales for the year rose by 99.51% to Rs.1498.20 cr. against Rs.750.92 cr. in the previous fiscal. The EPS
has shot up to Rs.6.64. The basic EPS was Rs.6.64 for the year against Rs.4.41 in the last fiscal.
BoI Net up by 78% from Rs.315 cr. to Rs.562 cr.
With a 25% growth in Net Interest Income and 49% growth in Non Interest Income, Bank of India (BoI) posted a overall
YoY growth of 78% in Net Profit at Rs.562 cr. in Q1FY09 from Rs.315 cr. in Q1FY08. This was despite increase in mark to
market provisions to Rs.129 cr. on the investment portfolio of the bank.
BoI's Total Income for Q1FY08 rose to Rs.4115 cr. from Rs.3108 cr., propelled by a growth in Non Interest Income from
Rs.381 cr. to Rs.566 cr.
Gross NPAs of the bank as on 30 June 2008 were contained at 1.64% from 2.29% as on 30 June 2007.
Sujana Universal Q4FY08 zooms
Sujana Universal Industries Ltd., the domestic appliances manufacturer, has reported a 997% rise in its net profit at
Rs.5.49 cr. for the quarter ending on 30 June 2008 from Rs.50 lakh in the previous corresponding period.
On a standalone basis, the net profit rose by 8.03% to Rs.23.6 cr. for the financial year ended 30 June 2008 from Rs.21.9 cr.
last fiscal.
BoB Q1FY09 improves
Bank of Baroda (BoB) has posted 12.1% higher Net Profit at Rs.370.86 cr. for Q1FY09. Its Operating Profit was up by 33.5%
at rs.860.19 cr. on 32.6% higher Total Business of Rs.2,66,122 cr.
BoB's Total Advances were up by 42.1%, Total Deposits were up by 26.5% and Total Income was up by 25.8%. Net NPAs
were down to 0.52% from 0.67% a year ago and its Capital Adequacy Ratio stood at 13.19% as per Base II.
Allied Digital Q1FY09 net up by 73%
Allied Digital Services Ltd. (ADSL), a Systems Integrator and IT Infrastructure Management Services Provider
company, has recorded 38% higher total income of Rs.90.20 cr. for Q1FY09 against Rs.65.23 cr. in Q1FY08. Net Profit
after Tax was 73% higher at Rs.15.66 cr. as against Rs.9.05 cr. in Q1FY08.
ADSL has recently acquired 80.5% stake in IT Infrastructure Management/Remote Management Services provider,
EnPointe Global Services Llc., a carved out subsidiary of EnPointe Technologies Inc. (ENPT) a NASDAQ listed company
with revenues over US $340 million. This acquisition is revenue and earnings accretive to ADSL and will serve as a
platform for other inorganic growth initiatives across the globe.
BoM Registers Q1 net at Rs.46.63 cr.
Bank of Maharashtra (BoM) has recorded 23.48% higher Total business of Rs.72090 cr. for Q1FY09 against Rs.58381 cr. in
Q1FY08.
Net Profit for the quarter stood at Rs.46.63 cr. as against Rs.81.58 cr. in Q1FY08. The decline was on account of higher
depreciation in its investment portfolio caused by market forces. Total Income during the quarter increased by 19.23% to
Rs.1040.68 cr. over Q1FY08.
The interest spread increased from Rs.306.47 cr. to Rs.317.21cr., registering growth of 3.50%.
SEL Manufacturing net up by 178% for Q1FY09
SEL Manufacturing Company Ltd. (SEL) has posted encouraging results for Q1FY09. The standalone total income
zoomed by 201% to Rs.176.87 cr. from Rs.57.21 cr. in Q1FY08. Net profit shot up by 178% to Rs.19.14 cr. from Rs.6.07 cr. in
Q1FY08. The basic & diluted EPS has gone up to Rs.10.91 in Q1FY09 from Rs.6.18 in Q1FY08.
Its consolidated total income zoomed to Rs.179.74 cr. from Rs.59.59 cr. in Q1FY08. Consolidated net profit shot up by
Rs.23.08 cr. from Rs.8.31 cr. in Q1FY08 with basic & diluted EPS of Rs.13.81 from Rs.8.47 in Q1FY08.
Aarti Industries Q1FY09 net zooms by 536%
Aarti Industries Ltd., a leading manufacturer of Basic Chemicals, Speciality Chemicals and Pharmaceuticals, has recorded
85% higher turnover at Rs.361.7 cr. In Q1FY09 from Rs.194.3 cr. in Q1FY08. PAT also zoomed to Rs.33.2 cr. in Q1FY09
536% higher from Rs.5.2 cr. in Q1FY08 recording an EPS Rs.4.56.
18
Disclaimer: Investment recommendations made in Money Times are for information purposes only and derived from sources
that are deemed to be reliable but their accuracy and completeness are not guaranteed. Money Times or the analyst/writer does
not accept any liability for the use of this column for the buying or selling of securities. Readers of this column who buy or sell
securities based on the information in this column are solely responsible for their actions. The author, his company or his
acquaintances may/may not have positions in the above mentioned scrip.
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By email
Courier (Add Rs.25 per issue as courier charge)
DFB:- Rs.2000 p.m. (By email only)
ISM:- Rs.8000 p.a.
By email
Courier (Add Rs.25 per issue if required by courier)
TT:- Rs.1000 p.m., Rs.10, 000 p.a.
By email
By post
Courier (Add Rs.25 per issue as courier
charges)
DBC:- Rs.2000 p.m., Rs.18000 annually (By SMS only)
ET:- Rs.2000 p.m. (By email only)
EBG:- 1 year: Rs.5000, 2 years: Rs.8500, 3 years: 11,000.
By email
By post
Courier (Add Rs.25
per issue as courier charges)
Winners:- Rs.2000 yearly.
By email
By post
Courier (Add Rs.25 per issue as courier charges)
Name (in capital):______________________________________________________________
Address: ______________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Tel. No.: (O) ___________________ (R) ___________________ (M)___________________
Email ID: ______________________________________________________________________
Are you an Investor
Trader
Broker/Sub Broker
Investment Adviser
Banker
Date & Place _____________
Signature ________________