*MONEY TIMES TALK*
*OCTOBER 21, 2023*
As per *market veteran* after a very long time, there is a bearish formation on all three major indices Nifty, Nifty mid-cap 100 & Nifty small caps 100. So any break below Nifty 19221 on closing basis may be very bearish and major panic may be seen in mid-cap & small cap stocks. Keep strict stop loss in holding scripts.
*Pearl Global* to consider sub-division of its FV on 8th Nov and a second interim dividend along with Q2 results, which are likely to be strong. It also plans to raise funds for further expansion. Buy.
*ICICI Lombard’s* Q2 NP declined 2.2% to Rs.577.3 cr. in spite of net premium increasing to Rs.4306 cr. as against Rs.2826 cr. in Q2FY23. Sell.
*Dr. Reddy Labs* received a nod from the regulator for weight loss drug studies and the subsequent launch of injections. A big positive. Add.
*Shetron* is reportedly working at full capacity and trades at attractive valuation of around Rs.115. Add.
*Walchandnagar Industries* has a bulging order book for defense products and its share price is in the ASM category due to rising stock prices. Add for hefty gains.
*Karnataka Bank* is likely to recover more than half of its ‘Coffee Day’ global debts. It has received binding offers from an ARC. A big positive. Add.
*Syngene* NP rose 14% to Rs.117 cr. with an equal rise in revenue. Add in small lots for the long term.
Steel demand in India is expected to grow 8.6% as against the global growth of 1.8% in FY24. *SAIL* may be a big beneficiary. Add.
*Tata Motors* is betting on SUV launches and upgrades to scale new peaks. Add for the long term.
Some brokerages are cutting price targets of *HDFC*. However, it still remains a safe investment bet. Retain.
*Bajaj Finance* Q2 NP grew 28% and its AUM stood at Rs.2,90,000 cr. Its share price is expected to rise. Add.
*Can Fin Homes* Q2 NP grew 11.3% to Rs.158 cr. on higher interest growth. Add for the long term.
Cement companies are expected to report better profitability in FY24 due to strong volumes. Add *Shree Cement and Ultratech Cement* for hefty gains.
*Glenmark* gets US FDA nod to market its arthritis drug and has launched a cheaper Type 2 diabetes drug. It already has 188 product authorizations in the USA. Add.
*HUL* plans a new technology to manufacture raw materials of detergents, soda ash and silicate that is expected to cut production cost and improve margins. Add.
*Bombay Dyeing* sold a small parcel out of its land bank for Rs.4657 cr. These funds may be used for various purposes including dividends and expansion. Add.
*JK Paper* entered into a share purchase agreement to acquire 100% equity shares of Manipal Utility Packaging Solutions Pvt. Ltd. for Rs.90 cr. A big positive. Buy.
*Grasim* will raise Rs.4,000 cr. via. rights issue for its ongoing capex, repay its borrowings and for general corporate purposes. Add.
*Data Patterns* earnings, revenue and EPS are expected to grow 30.5%, 29.3% and 28.9% p.a., respectively. Further, its RoE is forecast to be 16.7% in the next 3 years. Add.
"Gokaldas Exports* is hitting new highs after Narayana Murthy of Infosys fame picked up a stake. Add for the long term.
*Som Distilleries* is on a big expansion drive and has tied-up with Carlsberg beer that will result in 100% capacity utilization. It aims to notch a 10x revenue in the next 5 to 6 years. Add for hefty gains.
*KEC International* has won fresh orders worth Rs.1315 cr. and share prices are already surging. A safe investment bet. Add.
*International Conveyors* into conveyor belting since 1978 posted 120% higher Q1 EPS of Rs. 2.2 Q2, which may lead to FY24 EPS to of Rs.12 on FV of Re. 1. It recently bought 1,08,023 equity shares of BSE Ltd. for Rs. 10 cr. taking total shareholding to 43,846 shares. Buy.
144% dividend paying insurance PSU, *GIC*, has set-up representative offices in UK, Russia, UAE, Malaysia, South Africa and Brazil to focus on international business. It posted 34% higher Q1 EPS of Rs.11.1, which may lead to FY24 EPS of Rs. 45 from Rs.39.4 in FY23. Buy for 30% gain.
*Bhagyanagar India* manufactures copper products needed in telecommunications, power & distribution, transformers, heat exchangers, switchgear, solar panels and auto ancillaries. It has sold its 3-acre land for Rs. 43.5 cr., which can help retire its debts. Buy.
*Maan Aluminium* manufacturers and exports Aluminium extruded products needed in ladders, transport applications, pylons, platforms, tubes, hollow sections and pipelines, etc. It posted 21% higher Q1 EPS of Rs. 3.8, which may lead to FY24 EPS of Rs. 16, which may take it share price to Rs. 160. at a P\E of 10x. Add.
*Venus Remedies* has consolidated its business in ASEAN countries and got marketing approval for six chemotherapy drugs in Philippines. Buy.
*Karur Vysys Bank’s* two new branches takes the branch total to 824. It posted 14.1% YoY higher H1FY24 advances of Rs. 70,446 cr. while deposits rose by 13.2% to Rs. 83,068 cr. and total business grew 14.15% to Rs.1,53,514 cr. Accumulate.
*IndusInd Bank’s* H1FY24 net advances grew 21% YoY and 5% QoQ to Rs. 3,14,928 cr. while deposits rose 14% YoY and 4% QoQ at Rs. 3,59,819 cr. It posted 22% higher EPS of Rs. 28.4 in Q2 & 26% higher EPS of Rs. 55.7, which may lead to FY24 EPS of Rs. 120 from Rs. 96 in FY23. The promoters, Hinduja Family, to invest Rs. 10,000 cr. to hike their stake, which may boost the share price to Rs. 1600. Accumulate.
*Federal Bank’s* H1FY24 deposits grew 23% to touch Rs. 2,32,871 cr. while gross advances rose 20% to Rs. 1,95,973 cr. from Rs. 1,63,958 cr. Y-o-Y. This indicates a robust performance. Buy.
*J.Kumar Infra* bags orders of Rs. 509 cr. from the Command Hospital, Lucknow, taking total orderbook to over Rs. 18,000 cr. Buy
*Savita Oil* commissions new Synthetic Ester plant for Transformer Fluid applications, high-performance automotive and industrial lubricants and plans to launch EV Coolants and Immersion Cooling Fluids. Buy for the long term
*Shriram Pistons & Ring* posted 86% higher Q1 EPS of Rs. 23.1 on expanded equity of Rs. 44 cr. post 1:1 bonus. This indicates that FY24 EPS may rise to Rs. 95. Buy for 30% gain
*Orient Cement* of the CK Birla group has 8.5 MMTPA has approached Adani Group to sell a promoter stake of 38%. Accumulate at every decline
*IIFL Securities* with 2500 offices across 500 cities has notched 95% higher Q2 EPS of Rs. 3.5 and 87% higher H1 EPS of Rs. 6, which may take FY24 EPS to Rs. 12.5 from Rs. 8.1 in FY23. It has net surplus of over Rs. 5500 cr. Buy for 30% gain
*Vasundhara Rasayan* is available at a P/E of 11x. It has a promoter holding of 62%. It notched FY23 EPS of Rs.17.59 and has posted 60% higher Q1 profit. Add for multi-bagger gains.
*Anjani Synthetics* posted profits even in bad times. It is available at a P/E and P/B of 16x and 0.63x. The promoters hold 74% and reputed HNI’s hold 15% stake. Add for hefty gains.
*XT Global* commenced a new development center across 3 lakh sq. ft. with a seating capacity of 2000 in Vizag. A big positive. Keep it on your radar.
*Akar Auto* trades at huge discount to its market cap of Rs.90 cr. Forging and spring leaf units see huge demand due to uptick in auto sector. Promoters may infuse funds for proposed expansion. Add.
*Tyche Industries* envisions to be a leading global manufacturer of APIs & advanced intermediates by 2025. It trades at a P/E and P/B of 13x and 1.63x; and has a RoE of 12.68%. The promoters hold 62%, Plutus Techlabs P. Ltd hold 6.40% and reputed HNI, Lincoln P Coelho, holds 1.46% stake. Add
*QMS medical* has started a collaborative development with BETIC for an android mobile application that will streamline the data collected during health camps. A big positive. Add.
*Uravi T,* second largest provider of automotive signalling and parking lams to Pricol, Spark Minda, Lumax Auto, FIEM, Varroc, Suprajit, Rinder, Stoneridge etc. aims to go global. Add for good gains
*Techno Electric & Engineering* Q1 PAT grew 146%. With high growth potential starting by Diwali it is likely to perform well in H2FY24. It has huge cash of Rs.1500 cr. The DIIs and FIIs hold 26.39% stake. Add for 30% gains.
*PBM Polytex* has 69% promoter holding, Sunita & Santosh Goenka hold 3.80% and Sanggeetha S holds 1.35% stake. It has equity of Rs.7 cr. & reserves of Rs.117 cr. Its BV stands at Rs.181 and P/B is 0.52x. Add.
*SGRL* makes monopoly pharma & chemical products with a margin of 24-28%. It plans big capex in H2FY24 due to improve margins further. Add for 30% gains
*HSCL* notched 149% higher H1 profit. NCLT approves the acquisition of Birla Tyres by its JV. It is also expanding in to Lithium chemicals for EVs. A big positive. Add.
On Friday, 20th Oct in a highly bearish market, *Bondada Engineering* hit a 52-week high of Rs.281 with volumes. It provides EPC and OEM service in the telecom & solar energy sectors. Keep track.
*Tata* holds a Unified License with Access Service in Maharashtra and Goa and Internet Service Provider is a turnaround candidate given the boom in telecom sector. Add.
Recently listed, *Plaza Wires* plans to expand of 8,37,000 coils per annum and 8700 km per annum. Buy.
*Univastu India* engaged in EPC services for civil & structural construction and infrastructure sector projects shows uptrend in revenue and order inflows. Keep track of this micro-cap good returns.
Steel cycle is turning positive. High growth planned by *Shyam Metallics* with internal accruals. Should grow well.
Cement bound to do well with infra development. None better than the dominant *Ultratech Cement*.
*Kalyani Steels* is a steady performer. It also gets business from sister unit Bharat Forge. Cash rich status makes it even more attractive.
*Servotech Power Systems*, leading EV charger has signed two MOUs with IIT Roorkee to develop state-of-the-art rectifier units for CCS2 chargers and Onboard EV chargers for 2, 3 and 4 Wheelers. Add
Ducab leader in the wire and cable industry may acquire 22.5% stake in *Godha Cabcon & Insulation*, which has gained a foot hold in the conductors and wires industry. Add.
*Money Times Talk is part of 'Money Times' publication.*