Tower talk By VR Advisors Date 5 May 2020
1) Power Mech Projects is available at a yearly low and is expected to take a bullish turn. It would be prudent to add this share with a long-term perspective.
2) Mold-Tek Packaging shows strong signs of a breakout. It recently acquired huge orders from Asian Paints. Accumulate.
3) With crude oil price quoting multi year lows, tyre manufacturers JK Tyre & Industries, Ceat and Apollo Tyres which have huge capacities, would be the best beneficiaries. Accumulate.
4) Glenmark Pharmaceuticals claims that it has come close to develop a COVID-19 vaccine. A very good long-term investment.
5) Mumbai doctors try Biocon’s and Roche’s biologic drugs on critical COVID cases. It would be prudent to add both these pharma stocks.
6) Although Marico reported a 50% drop in PAT in Q4FY20 of Rs.199 crore, it has a very strong rural marketing network and its profitability ratios are expected to rebound soon. The weak price makes it a good opportunity.
7) Orbit Exports has resumed operations at its Surat factory and Delhi office. A positive for the company. Accumulate.
8) Ashok Leyland reported zero production in the last few months. With the lockdown continuing and prevailing uncertainty, it may be prudent to exit for some time and re-enter later.
9) In order to meet current business demands, Manappuram Finance plans to raise Rs.5000 crore via private placement. Accumulate.
10) IDFC First Bank has raised Rs.2000 crore via preferential allotments to HDFC, Warburg Pincus and Bajaj Finance. It would be prudent to follow these heavyweight investors. Accumulate IDFC First Bank.
11) In the view of rupee weakening, Infosys looks attractive at the CMP of ~Rs.678/share. Accumulate.
12) Indiabulls Ventures continues to rise and could double in a year. It has not defaulted in any of its debt repayment. Accumulate.
13) Bharti Airtel to claim a refund of Rs.923 GST payment between July and September of 2017. This would help its liquidity problem and is morale booster. Add.
14) For Q4FY20 NIIT Technologies posted a 11% higher PAT of Rs.102 crore jumped 20%. A dividend of Rs.11/ share has been declared. In a scary market, this is a good share to add
15) For Q4FY20, Astec LifeScience posted a 145% higher PAT of Rs.31.17 crore. The uncertainty in the market cannot dent its price. Retain and add.
16) Bharat Dynamics has bagged an order worth Rs.293.33 crore for the supply of MRSAM missile system to the IAF (Indian Air Force), which has to be executed in the next 24 months. The company is a good dividend play too. Add.
17) Global buyout funds KKR, Carlyle, Apax Partners are in the race to acquire J.B. Chemicals & Pharmaceuticals. This may give the stock a price boost. Add.
18) The promoter of Apollo Pipes Sameer Gupta acquired 1.25 lakh equity shares from the open market at ~Rs. 310/share. Some good news seems around the corner. Accumulate.
19) Ajanta Pharma is expected to report growing profits in the next few quarters on the back of rising sales. Further rising volume and price are good indications. Add.
20) Redington (India) is expected to notch an EPS of Rs 16+ in FY20. The share is poised to touch Rs.100. Accumulate.
21) With a likely EPS of Rs.40 in FY20, Kaveri Seed Company (KSL)is an excellent buy. In the Rs.15000 crore organized hybrid seed market, KSL commands ~8-10% of the business. Buy for decent gains.
22) Datamatics Global Services is expected to notch an EPS of Rs.13-14. It trades at a forward P\E of 3.0x. Buy for ~50% gain.
Meghmani Organics, which is undergoing an expansion, is expected to report an EPS of Rs.10-11 in FY20. Buy for ~30% return.
23) Hi-Tech Pipes has recently completed its expansion and is expected to notch an EPS of Rs.22 in FY20. The share is available at an attractive valuation of just 3.5x. Accumulate.
24) Andhra Sugars, which derives 90% of revenue from the chemical segment is expected to notch an EPS of Rs.65+ in FY20. The share is poised to appreciate by ~30%. Accumulate.
25) Nikhil Adhesives has a highly scalable and solid business model and has done well in 9MFY20 with an EPS of Rs.11.6. It is likely to score an EPS of ~Rs.17 in FY20. The share is poised to touch Rs.200. Accumulate.
26) Going by its 9MFY20 results, Agarwal Industrial Corporation is likely to notch an EPS of ~Rs.20 in FY20. The share has the potential to cross Rs.90. Accumulate.
27) Voith Paper Fabrics India (formerly Porrits & Spencer), a German MNC with 74% stake is expected to notch an EPS of Rs.62 in FY20. It is also expanding its capacity by over 30%. It is the cheapest MNC share. Accumulate for ~30% returns.
28) GRM Overseas is expected to notch an EPS of ~Rs.35 in FY20. It is one of the cheapest shares in the food sector. Accumulate.