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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JK Laxmi Cement, a JK Group company, has posted surprising numbers as most of the other cement companies are facing margin pressure. Against 14 per cent in Q3 it has posted 20 per cent operating profit margin in Q4. In Q4 sales also increased from Rs 1424 crore to Rs 1600 crore and profit from Rs 153 crore to Rs 184 crore. For the full FY sales was Rs 5420 crore and PAT Rs 464 crore. Its 52 week high was Rs 816 crore and despite huge jump in last two trading sessions it is still trading at Rs 494. We feel this stock will be a dark horse amongst the cement sector companies.
Nava Bharat Ventures, was first discussed here on January 31 when it was trading at Rs 127. It went up as suggested and we again discussed it on April 25 at Rs 162. Even in this market it is trading at Rs 205. So if anyone followed our suggestion in January, he is sitting on almost 90 per cent gain. This has happened after 2010 and happened because sales are up from Rs 689 crore to Rs 1016 crore and profit from Rs 134 crore to Rs 273 crore. For the full FY sales was Rs 3384 crore, operating profit Rs 1319 crore and net profit Rs 518 crore. These numbers are highest ever in its history. With a book value of Rs 341 and trading at 5.2PE the stock is inching towards Rs 250.
Elecon Engineering Company was discussed here on April 4 when it was trading at Rs 155. Although most of the midcap and smallcap companies have corrected almost 50 per cent, this stock is trading at Rs 205. For the full FY sales was up from Rs 1045 crore to Rs 1204 crore, operating profit from Rs 186 crore to Rs 246 crore and with operating profit margin of 20 per cent the net profit increased from Rs 58 crore to Rs 140 crore. These numbers are highest and the best after 15 years. In the negative market sentiment the stock kept rising and outperformed it. We see a good up move from here also.
Rashtriya Chemicals & Fertilizers has many pluses and that was the reason in last 4 months we discussed many times; first when it was trading at Rs 72. It went up to Rs 112 and now trading at Rs 100. Finance Minister has increased the fertilizer subsidy from Rs 1,05,000 crore to Rs 2,15,000 crore to offset the global increase in price. That is beneficial for the company as there would be no impact on sales. Its Industrial Production division has recorded an increase in sales turnover of around 114 per cent in FY22. Secondly with a record of paying handsome dividend it also has land parcel which is valued more than double its market cap. The company will announce its result and final dividend numbers on May 27. We are bullish on the stock.
Mishra Dhatu Nigam (Midhani) was discussed here on February 5. During March quarter it has recorded highest ever export numbers. With several monopoly products it 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. It is a value buying if one likes to have a defence related company in portfolio.
Garden Reach Shipbuilders & Engineers (GRSE) is one of the leading shipyards, located in Kolkata. It builds and repairs commercial and naval vessels. Presently GRSE has also started building export ships in a mission to expand its business. It has delivered more than 100 warships to Indian Navy and Coastguard. A debt free company with unlimited orders on TTM basis its sales, operating profit and net profit are highest ever in its history. Presently trading at its 52 week high at 17PE with its operations and the focus of government on defence sector, we feel a big PE expansion happening shortly at this counter.
Jet Freight Logistics has migrated from the NSE-Emerge Platform in December 2021 and has recorded 40 per cent increase in share price from the listing date. The revenue for the year ended 31 March 2022, amounted to Rs 458 crore compared to Rs 347 crore for last year. The company ended the year with 22,297 tonnages of shipment. A part of the promoter group has released the pledging comprising 25.8% of the total paid-up capital and Promoter group has increased their holding from 69.27% to 70.15% during the FY 2021-2022. It shows their commitment and the expected future growth. The company is equipped with good order book and can be kept on investment radar.
Ashok Leyland is a multinational automotive manufacturer owned by the Hinduja Group. After 15 quarters the company has registered its highest operating profit of Rs 1194 crore in Q4. It indicates that demand in commercial space is coming back. After March 2019 the company recorded good sales numbers. In EV also the traction is good. Many state governments are introducing the technology in buses which will provide good opportunity to the company. During last 18 months the stock has been consolidating in a limited range of Rs 110-140. The impact of all the above discussed good news is yet to be seen. We feel the stock will cross its all-time high of Rs 167.50 soon as already it is trading at Rs 130.
THE SCOOP OF THIS WEEK
ITD CEMENTATION INDIA, a mid-size MNC company in a rare segment of infra sector besides roads, airports and hydroelectric power, was discussed here on January 10. It has an order book of Rs 12,000 crore to last for three years. On TTM basis it has registered highest ever profit in its history. In November 2017 it made all time high of Rs 235 but now with the best of financial numbers the stock is available at Rs 60 only trading at 10PE. It could be the lowest ever valuation for the stock and provides the best opportunity to buy.
