IEM Market Buzz – Last week’s Performance
|Stock Name||Mention Price||High during the week||Change in %|
|La Opala RG||366.65||450.9||23%|
Yes Bank stock attracted huge attention last week with good volume. Ratings agency Moody’s has upgraded its rating and changed the outlook to positive from stable. Another positive comes from RCap and Vodafone Idea – one has gone to NCLT and second showing better performance, giving indication of good recovery from both. The bank is now also focusing on retail lending. It seems all is well and it can double in a year from this level. Investors have nothing to lose as probably no downside can happen.
GTPL Hathway is the 2nd largest Multi-Service Operator engaged in cable TV distribution and high-speed broadband service distribution across 15 states. On TTM basis its sales, operating and net profit is at highest ever level, with ROCE 32 and ROE 22 percent. In FY21 it gave a dividend of 40 per cent. As the media stocks are showing good momentum this counter, with Mukesh Ambani led Reliance group having major stake, can give huge returns.
Granules India, discussed in issue dated November 20 when it was trading at Rs 305, has given 13 per cent return now available at Rs 345. As we said earlier, from Q4 demand will come back and those, who bought after we discussed it, should remain invested but those who missed should buy between Rs 335-325. The stock has come out of its one and half year consolidation period now entering into a new uptrend cycle. Very good for medium to long term.
TV18 Broadcast has recorded good September quarter numbers as sales, operating profit and net profit were up by 29, 47 and 88 per cent respectively. Also in last 6 months its sales, operating profit and net profit were up by 38, 106 and 216 per cent respectively. On TTM basis its income is Rs 5172 crore, operating profit Rs 1029 crore and net profit Rs 620 crore, which is highest in its history. Against Rs 3500 crore marketcap of Zee Entertainment its marketcap is Rs8500 crore but the price disparity is huge. In 2008, 2010, and 2018 it traded at Rs 215, 126, and 71 respectively. Now with an all-time high OPM this stock seems undervalued.
Indiabulls Real Estate is emerging a good bet as KG Krishnamurthy, former MD & CEO of HDFC Property Venture will take over as chairman on February 2, 2022. After its merger Embassy group and Blackstone will be the new promoters. Ace investor Rakesh Jhunjhunwals holds 50 lakh shares of the company having 1.1 per cent stake. It is still available at reasonable valuation with so many positive happenings.
CCL Products India has a global client repertoire in over 90 countries and the largest instant coffee exporter and private label manufacturer across the globe. With manufacturing plants in Andhra Pradesh and Vietnam its ROCE and ROE is better than Tata Coffee. As Coffee prices across the globe have increased tremendously during 6 months its impact will be visible in next quarter numbers and the stock may go beyond Rs 500 level.
IDBI Bank has performed really well after LIC’s entry which has virtually turned around it. From a loss of Rs 44,560 crore, accumulated between 2016 to 2020, now the financials are in much better shape. On TTM basis it has clocked a profit of Rs 2209 crore which is highest in last 12 years. Gross NPA reduced from 30 to 21 per cent and Net NPA from 14-15 to only 1.62 per cent. Now either it will go in private hands or government will reduce its stake from 45.48 per cent or LIC will do the same which holds 49.24 per cent or both will do the same. In all the probabilities a re-rating is confirmed. Considering these possibilities 30-40 per cent return in a year is certain from this counter.
APL Apollo Tubes which was trading at Rs 103 in March this year has given 10X return trading around Rs1000. With 16 patents, 10 plants and capacity to produce 2.6 Million Tonnes per annum, it is the largest producer of Structural Steel Tubes with 800 distributors in 29 cities as well as 20 countries worldwide. In last 6 months its sales, operating profit and net profit were up by 70, 99 and 156 per cent respectively. The kind of demand is seen in the space the counter has still a lot of potentials.
ABB India, the MNC, is trading at an all-time high and recently recorded on weekly basis highest ever closing. Whenever economy moves capital goods sector also moves in the same speed. The company, after December 2018 has recorded highest ever operating profit in September quarter. With a technical breakout and growth visibility investors can pick up on each fall in staggered manner.
LG Balakrishnan is a leading auto ancillary company. In September quarter sales, operating profit and net profit were up by 38, 83 and 180 per cent respectively. Also in last 6 months its sales, operating profit and net profit were up by 58, 131 and 410 per cent respectively. On TTM basis its sales, operating and net profit is at highest ever level. Company posted highest ever quarterly performance in Q2FY22 and paid 50% dividend for FY20 and 100% for FY21. In 2018 it was trading at a high of Rs 671 but even after recording 2.5 times profit still it is available at Rs 560. With Mutual Funds holding 12.19% stake, and trading at 9PE it could prove a dark horse.
Manali Petrochemicals develops innovative products that find application in a variety of industries such as appliances, automotive, food & fragrances, furniture, footwear, paints and coatings, and pharmaceuticals. The company is on a big expansion spree as product demand is huge. In September quarter sales, operating profit and net profit were up by 101, 327 and 465 per cent respectively. Also in last 6 months its sales, operating profit and net profit were up by 151, 532 and 726 per cent respectively which is highest in its history. On TTM basis its operating and net profit is Rs 524 crore and Rs 372 crore. Trading at 5.5PE and sustainable growth prospect the stock can easily cross Rs 150.
Pricol Limited was trading at Rs 122 in 2018 and closed on weekly basis last week at Rs 126. On technical chart the stock has given breakout of a perfect rounding bottom formation. This auto ancillary company manufactures more than 2000 products and exports to 45 countries. It has given a technical breakout and since the company has entered into EV space creating another source of revenue, it can easily cross Rs150 any time soon.
ISGEC Heavy Engineering Ltd. is a multi-product, multi-location providing engineering solutions to customers around the world for the past 88 years. Sometime back it made a high of Rs 877 but now trading below 33 per cent from that level as the first half of current FY the performance suffered due to some reason. Now the downside is limited and with such diversified product portfolio and increasing demand the stock will certainly soon regain past glory.
Borosil Renewables is the first and only solar glass manufacturer in India used for various applications. Recently it has expanded production capacity to 2.5 GW per annum and working on the next expansion to add another 2.5 GW. In September quarter sales, operating profit and net profit were up by 41, 70 and 143 per cent respectively. Also in 6 months its sales, operating profit and net profit were up by 76, 180 and 505 per cent respectively. The way solar is getting attention from the government the counter is ready to move into four figures.