Please remember, these are not recommendations/ suggestions to buy or sell. Strictly for educational purpose the Indian Economy & Market Research Team has collected these details from the public domain for our subscribers as these couldn’t be a part of our regular monthly magazine.
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Sun Pharmaceutical Industries has recorded highest ever sales and operating profit on TTM basis in its history respectively Rs 37,731 cr and Rs 10,106 cr. After almost 6 years the stock has regained its high made in 2015 which is a good sign of revival. The company has launched 25 new products in last 3 months and still more to come shortly. All its 4 verticals – India, Emerging Market, US and Rest of World formulations have recorded very good growth – and it seems the stock is getting ready to enter the 4 digits arena.
Speciality Restaurants has posted a turnaround performance in the September quarter and recorded Rs 2.60 crore profit against loss of Rs 14.41 crore in the same period. The company has some of the most sought-after brands like Mainland China, Flame & Grill, Haka, Machaan, Oh! Calcutta, Zoodles, and Sweet Bengal. Last FY Mainland Asia Kitchen and Sweet Bengal contributed 32 and 38 per cent in its total revenue. Most of the recent IPOs from this space are trading at very high valuation whereas Speciality Restaurants is far better bet. It can be considered before its result which is due on 10 February. Since Covid also is receding now the financials will certainly improve.
Taj GVK Hotels & Resorts was discussed here on January 17, 2022. The joint venture of Indian Hotels and GVK Group it has posted good numbers in Q3 wherein sales increased from Rs 36 crore to Rs 82 crore, operating profit from Rs 10 crore to Rs 29 crore and net profit from Rs one crore to Rs 12 crore. With this it has recorded highest ever operating profit and highest operating profit margin in last 13 quarters. Even in this challenging time the company reduced its borrowing by Rs 61 crore during the first half of this FY. Such performance can lead to a re-rating. Its all-time high was Rs 342, now available at just Rs 136.
Sarda Energy & Minerals has posted wonderful Q3 numbers as its profit increased from Rs 604 crore to Rs 999 crore and net profit increased from Rs 116 crore to rs 167 crore. Profit in these last 9 months increased from Rs 235 crore to Rs 591 crore and per share it has earned Rs 163.88. On TTM basis also its performance is the best ever. Trading at 4.5PE the counter is ready to get in the four figure bracket.
Dhampur Sugar Mills posted an impressive domestic sugar sales volume of 79 crore kg. Its distillery capacity is 22 crore liters and crushing capacity 45,500 MT per day. On sugar volume basis it is the third highest listed company whereas in distillery it is second highest. Still compared to its peers it is trading at cheaper valuation. It was the first company to produce sulphurless refined sugar in the country. Its refined sugar production capacity is 1700 MT per day, organic fertilizer capacity 20,000 MT per annum and ethanol capacity is 3 lakh liters per day. This is the best counter if one wants to play sugar and ethanol theme.
Balaji Telefilms, with Mukesh Ambani led Reliance’s stake of 24.92 per cent, has seen an up move recently and on weekly basis closed highest ever after August 2020. For 18 months it was trading in a range of Rs 52-72 but now a big range breakout is visible on the charts and can easily make a century. Fundamentally it has nothing much to showcase so it could be a pure technical call.
Ganga Forgings is one of the leading steel forging and machine components manufacturer supplying to major industries like Construction, Railways, Mechanical industries, Oil refineries, Mining, etc. It has recently bagged a big export order from US. All set to enter manufacturing products for EV vehicles, it is one of the few forging parts manufacturers growing at an exceptional rate. With thrust on Automobile industry in the current budget the demand for forged products would see an upward trend. The company has been consistently reducing its debt. A good candidate for anyone’s watch list.
Mishra Dhatu Nigam (Midhani) is a PSU and into specialized metal, metal alloys and value-added steel manufacturing under the administrative control of Department of Defence Production, Ministry of Defence. It is the only producer of Titanium in country with DRDO, HAL, ISRO, Ordnance Factories, L&T and Bhel as its clients. One look at the Budget indicates the huge demand for its products as more private companies will jump in the defence manufacturing sector and that could be a game changer for this counter. If one likes to have a defence related company in portfolio then nothing better than this.
HG Infra Engineering will surely get a big share from finance minister’s sharply hiked capex budget of Rs 7.5 lakh crore because the company gets 90 per cent of its order from the government and only 10 per cent from private sector. Present in 8 States its 46 per cent orders are for EPC and 54 per cent HAM (hybrid annuity model). Presently with Rs 8800 crore strong order book on TTM basis its operating profit and net profit are Rs 698 crore and Rs 387 crore respectively which is quite impressive. Its operating profit margin is 19 per cent and on TTM basis interest cost Rs 114 crore. Trading at 10.5 PE with clean balance sheet the counter has corrected Rs 200 from its top, available at Rs 630. Good for infra-spend related stock for any portfolio.
Hindustan Copper may be benefitted by the stable copper price and can perform well. December quarter result is expected to be very good and the counter may cross Rs 150 shortly if all goes well.
DCM Shriram is a diversified manufacturing company with a portfolio of products comprising of sugar, alcohol, fine chemicals, industrial fibres, Defense and engineering products. In Q3 it has clocked 26.5, 46 and 38 per cent increase in its sales, operating profit and net profit respectively. On TTM basis its sales, operating profit and net profit were Rs 9022 crore, Rs 1523 crore and Rs 898 crore respectively. With multiple businesses and all segments doing well the stock is trading at 21PE. Can be kept in watch list and whenever the market gives an opportunity it can be grabbed.
Vikas Lifecare got a booster dose when its recent acquisition Genesis Gas Solutions bagged a big order from Aavantika Gas Ltd., a Joint Venture of GAIL & HPCL. The order is for Gas Meters and Last Mile Connectivity. Genesis Gas Solutions is engaged in the business of developing Smart Products including Smart Gas Meters & Power Distribution solutions for the infrastructure segment. The recent movement in stock price can attract risk takers who want to make a quick killing.
THE SCOOP OF THIS WEEK
ORIENT ABRASIVES was set up in technical collaboration with Karborundum, Bentueky, Czechoslovakia by the Rajgarhia group of industries as a venture to manufacture Calcined and Fused Alumina products. Today, the Company is largest producer of Calcined and Fused Products in India. On weekly basis it has given highest closing after May 2018 and on weekly chart gave a cup and handle pattern breakout. Right now all the abrasive companies are doing well. In March 2020 Grindwell Norton was at Rs 375 now trading at Rs 1860, Carborundum Universal was at Rs 180 now trading at Rs 900 and Wendt India jumped from Rs 1650 to Rs 5240 in the same period. This counter has also all the ingredients to record such stupendous achievement.
Despite the unusual cold wave in Mumbai and Covid, Dalal Path still finds its regulars looking up at the TV screen and discussing stocks. Some of the names our team heard are – VRL Logistics, JP Associates, Chalet Hotel and Vedanta Limited. Might be worth a second look.
