*MONEY TIMES TALK*
*NOVEMBER 05, 2023*
As per a *market veteran*, the history of growth in Indian Stock markets 6 months before the Lok Sabha elections as follows: Nov 1998 - May 1999 +36%, Nov 2003 – May 2004 +9%, Nov 2008 – May 2009 +31%, Nov 2013 – May 2014 + 19%, Nov 2018 – May 2019 +11%. Will history repeat itself during Nov 23 – May 24 or deviate with negative returns?
US 10 Year Bond yield is down almost 50 bps, which can be a game changer for Emerging markets. If it sustains below 4.35, there will be strong buying by FIIs as their selling is directly related to the US bond yield. If US bond yields will cool off, money will flow again into equity markets and since India is the best performing major economy, it will attract strong inflows.
Strong Q2 earnings by *JK Lakshmi Cements* suggest a big bounce in the cement industry. It plans to set up a new greenfield project to make 13.5 lakh TPA at its Surat unit. Add.
*Mahanagar Gas*, sole distributor of CNG & PNG in and around Mumbai is in capex mode and has notched 107% higher Q2 EPS of Rs.34.3 and 103% higher H1 EPS of Rs.71.6, which may lead to FY24 EPS of Rs. 130+ from Rs.80 in FY23. A reasonable P/E of 12x may take its share price to Rs.1560. Buy.
*Indian Bank,* which amalgamated Allahabad Bank into itself has notched 61% higher Q2 EPS of Rs.16.6 and 51% higher H1 EPS of Rs.31.5, which may take FY24 EPS to Rs.65-68. A reasonable P\E of 8.5x can take the share price to Rs. 552-578 in the medium term. Buy/Add.
The *Anup Engineering* into process industries like Oil & Gas, Petrochem, LNG, Fertilizers, Chemicals/ Pharma, Power, Water, Paper & Pulp and Aerospace. It has notched 69% higher Q2 EPS of Rs 21.9 and 122% higher H1 EPS of Rs. 40.3, which may lead to FY24 EPS of Rs. 85. Buy for 30% gain.
*IIFL Securities,* a key player in both retail and institutional segments has notched 95% higher Q2 EPS of Rs. 3.5 and 87% higher H1 EPS of Rs. 6. This might take FY23 EPS to Rs. 12.5 in FY24 from Rs.8.1 in FY23. Buy for 30% gain.
*LIC Housing Finance,* the largest financier of existing/new property for business/ personal needs and loans for business purposes has notched 280% higher Q2 EPS of Rs 21.7 and 103% higher H1 EPS of Rs 45.7, which may lead to FY24 EPS of Rs.90+ from FY23 EPS of Rs 52.6. A conservative P/E of 7x could take the share price to Rs 630. Buy.
*Shilp Gravures,* the pioneer and leader in Electro-Mechanical Engraving has garnered 359% higher Q1 EPS of Rs.6.3 from FY23 EPS of Rs.12.7, which may take FY24 EPS to Rs. 20+. The share made a lifetime of Rs.180 on 11 Oct, 2021 is expected to advance by 30%. Buy.
*Chamanlal Setia*, a rice exporter, has notched 23% higher Q1 EPS of Rs.5.3. Based on the current going, an EPS of Rs.30 can be anticipated in FY24 from FY23 EPS of Rs. 22.7 on its equity of Rs. 10.4 cr. Buy.
*ITL Industries* manufactures and sells band saw machines, CNC tube mills and machine tools has notched Q1 EPS of Rs.5.7, which may lead to FY24 EPS of Rs.28. Traditionally, ITL fares better in the second half. Accumulate.
*Voith Paper Fabrics*, a German MNC with 74% equity has posted 47% higher Q1 EPS of Rs.22, which may lead to FY24 EPS of Rs.95+ in FY24 from Rs.72.3 in FY23 on a small equity of Rs 4.4 cr. Buy this blue-chip share for hefty gain.
*DCB Bank* to sell up to 7.5% stake to Tata Asset Management and offer Max Life comprehensive range of life insurance solutions. DCB’s Q2 EPS rose 14% to Rs. 4.1 and H1 EPS by 25% to Rs.8.1. It may post FY24 EPS of about Rs.17. Buy.
*Canara Bank* with a network of 9656 branches and 10683 ATMs and has clocked 40% higher Q2 EPS of Rs.20.9 and 54% higher H1 EPS of R. 41.5 from FY23 EPS of Rs.62, which may lead to FY24 EPS of Rs. 85+. A reasonable P/E of 7x could take the share price to Rs. 595. Must be in portfolio.
*IDFC First Bank* Q2 NP grew 35% to Rs.751 cr. and NII stood at Rs.3,950 cr. Add for the long term.
*Ashok Leyland* is working hard to present a strong EV in the LCVs segment. A big positive. Add.
*KPIT Tech* is set to gain from its new products as automotive manufacturers invest in new technologies in India and overseas. Add.
*KEC International* has a strong order book of around Rs.25,000 cr. across all verticals and is faring very well. Add.
As per some analysts, *NTPC* is poised to maintain its market share without needing external equity. Further, its Q2 results indicate better profitability going forward. Add.
*Pearl Global’s* board will meet on 08/11/2023 to declare Q2 results and decide on interim dividend, and sub-division of its share apart from exploring possibilities for raising funds. Add.
*Gulf Oil Lubricants* has acquired a 51% stake in Tyrex Transmission Pvt. Ltd. and plans to become a leader in the EV charging green eco systems. Buy.
*Zydus Life Science* has acquired a UK-based LiqM group, which specializes in oral liquid products, for Rs.690 cr. It also hopes 50% growth in its novel drugs over the next five years. Add.
*Bharat Seats* has approved a capex of Rs.99 cr. to expand capacities. Its Q2 revenue grew 12% q-o-q to Rs.285.96 cr. and NP rose to Rs.4.67 cr. from Rs.6.83 cr. Add.
*Steelcast’s* Q2 NP was Rs.18.70 cr. and it declared a second interim dividend of Rs.1.35/share. Add in small lots.
*Godrej Properties* is on track to exceed full-year guidance on the back of robust demand. It expects cash collections to improve. Add on dips.
*Karnataka Bank* posted a robust Q2 but it fell short of investor expectations or was not properly interpreted. The deep correction merits a buy. Add.
A big jump of 96% in Q2 EBITDA of *J.K.Tyres* led to 40% higher PAT. The EPS soared to Rs. 9.33 (2.09). An excellent share in the Tyre segment. Buy.
*Raymond* has acquired a 59.25% stake in auto and aerospace player Maini Precision Products Ltd. for Rs.682 crore funded by a mix of debt and internal accruals. A big positive. Buy.
*Suzlon* Q2FY24 NP rose 82% to Rs.102.29 as against Rs.51.43 cr. in Q2FY23. Its EBITDA margin is also rising. Add.
*IRCON* is likely to post good Q2 results and will be a big beneficiary of the proposed international railway corridor. Add.
*V Tech Wabag* maintained its market leadership in Tunisia by securing various repeat orders Mrs. Rekha Jhunjhunwalla owns 8.04% stake in the company. Add.
*REC* plans to raise $599 mn in Green Bonds to fund is green loan portfolio. It Q2 NP rose 38%. Add for the long term.
*Ambuja Cement* Q2 profits surged over fourfold on lower expenses. Its standalone profits rose 8%+ to Rs.3970 cr. Add.
*LIC Housing* Q2 NP jumped fourfold to Rs.1198 cr. The CMP of around Rs.457 merits a buy. Accumulate.
*Competent Automobiles,* leading distributor of Maruti Suzuki cars in North India is available at a mkt. cap of Rs.243 cr. It trades at a P/E of 9.14x and P/B of 0.80x. Its BV is Rs.505 and the promoters hold 75% equity stake. Add for multi-bagger gains.
*BDH Industries* stock trades at a P/E of 14.3x. It has a RoE of 16.27%, RoCE of 19.61% and dividend yield of 2.5%. It notched FY23 EPS of Rs.14.25. Keep it on your radar.
*Uday Jewellery* plans to expand fourfold by internal accruals. Wedding season is around but it is yet to show an up-move. The promoters hold 74% of the equity capital and HNIs and corporates hold 20% stake in the company. Add for 30% gains.
*Artefact Projects* stock trades at a P/E of 8.6x and P/B of 0.86x. Its CMP of Rs.64 is way below its private placement price of Rs.111. HNI’s hold 7.26% stake in it and it has a strong order book. It notched FY23 EPS of Rs.7.58. Add.
On Friday, a highly bullish breakout with huge volumes was seen in *HCC*. Its Q2 result will be declared on 9th November. Keep it on your radar.
*JP Associates* hit new 52-week high on Friday 3rd November with big volumes. Keep it on your radar.
On Friday, *Satin CreditCare* hit new 52-week high of Rs.271 with huge volumes and may touch Rs.300 soon. Keep it on your radar.
*Anmol India* Q1 NP was Rs.9 cr. as against Rs.18.66 cr. in FY23. It has reduced debt and delivered good profit growth at a CAGR of 45% over the last 5 years. Its Q2 results are on 7th Nov. Add for 30% gains.
*IRB Infra* declared Q2 PBT of Rs.181.56 cr. and a dividend of 10%. The future seems very bright. Keep it on your radar.
*Amarjothi* Q2 NP rose 120% to Rs.3.36 cr. from Rs.1.53 cr. q-o-q. Its equity of Rs.6.75 cr. is supported by reserves of Rs.163 cr. and the promoters hold 60% stake. Reputed HNIs like Anil Kumar Goel holds 6.77%, CH Kiron holds 2.54 and Sangeetha S holds 2.28%. Keep it on your radar.
*QMS Medical* to acquire Saarathi Healthcare Pvt. Ltd. and Prometheus Healthcare Pvt. Ltd., which may boost its PAT Rs. 30 cr. in FY25. A big positive. Add.
*Akar Auto* EBITDA stood at Rs.20 cr. It is trading at a massive discount. Its Q2 results are on 9th November. It is likely to cross its 52-week high of Rs.123. Add.
*Uravi T & Wedge Lamps*, a large manufacturer of automotive lamps for instrument clusters and second largest in automotive signaling and parking lamps for all leading OEMs. Keep it on your radar.
*Tyche Ind.* hopes to be a leading global player in APIs and advanced intermediates by 2025. It trades at a P/E and P/B of 13x & 1.63x. It has a RoE of 12.9% and RoCE of 17. Its Q2 results will be declared on 10th November. Add for 40% gains.
*Cosmic CRF* has orders worth Rs.50.48 cr. The promoters hold 73% of the equity capital. Its Q2 results will be declared on 10th Nov. Add.
*PBM Polytex* has a BV of Rs.181. The promoters hold 69% and 3 reputed HNIs hold 5.15% stake. Its Q2 results will be declared on 10th November. It is likely to cross its 52-week high of Rs.129. Add.
*Techno Electric & Eng*. high growth potential data center will commence by Diwali. It is expected to perform well in H2FY24. Its Q2 result will be declared on 10th November. Add for 30% gains.
*Shree Ganesh Remedies* has big capex plans in H2FY24. Its Q1 profit grew 66% and its Q2 results will be declared on 10th November. Add for 30% gains.
Due to very good Q2/H1 results, *Anantraj* hit new 52-week high of Rs.248 and is likely to reach Rs.300, Add.
*Godrej Agrovet* Q2 NP rose 86% to Rs.136 cr. from Rs.73 cr. in Q2FY23. It is likely to cross its 52-week high of Rs.528. Add.
*SPL Industries* stock trades at a P/E of 9.06x as against the industry average of 29.24x and at a P/B of 1x as against the industry average of 2.45x. Buy.
*JP Power* is an undervalued stock in the power sector and trades at a P/BV of 0.75x. It has been reducing its debt. Add.
*Telecom Network Operators* acquired 100% of the issued capital of SAR Televenture FZE, UAE. A big positive. It has great potential given the 5G wave due to hit India. Add.
*L&T Finance* has good fundamentals and a promoter like L&T. It is highly undervalued as compared to its peers. Add.
*Hero Moto* has posted excellent results. The rural market is showing steady growth. Add.
*Bajaj auto* is a leader in the 2-wheeler exports. Weak overseas markets are reviving along with the domestic market. Add.
*Maruti* is showing huge traction. It has huge expansion plans on hand. Higher models selling better with superior margins. Add.
*South West Pinnacle* Q2FY24 PAT grew 149% q-o-q. It has received orders from Vedanta and Reliance. A big positive. Buy.