Thursday, September 30, 2010


I have recommended a BUY on Orchid Chemicals @ Rs.161/-.Currently it is trading @Rs.232 .Long term investors can still HOLD and short-medium term investors may book partial profit at current level.
Old Reports can be accessed below:



Tuesday, September 28, 2010


Starch Industry is expected to perform well going forward mainly because of the expected reduction in raw material cost and improved demand from user industries like FMCG.Poultry ..etc.Universal Starch chem Allied Ltd is a company from this sector which is started to showing encouraging financials.This Maharastra based company producing many starch related products like Maize Starch Powder,liquid Glucose,Destroxe Monohydrate and having good business relations with companies like Johnson and Johnson,Cadbury ,Hindustan Unilever..etc.For the latest June qtr ,company posted a turnover of Rs.27 Cr v/s Rs.21 Cr and a net profit of Rs.1.8 Cr v/s Rs.90 lac. EPS for June qtr is above Rs.3/- .Better performance is expected going forward,one can BUY @ Rs.36.5 for medium term.

Saturday, September 25, 2010


MNC’s always enjoying premium valuations in Indian
Stock market ,especially companies operating from niche
space.De Nora India (DNI) is a niche company commanding a
market share of about 75% where it is operating , but
overlooked by the investor fraternity- may be because of  the
complex nature of business in which it involved .
This company is a 51.25% Subsidiary of Gruppo De Nora
of Italy ,the world leader in design,erection and
commissioning of electrochemical plants. DNI’s main business
includes coating of anode and Cathode using in Chlor Alkali
plants and corrosion systems used for preventing corrosion
in SAW pipes ..etc. Along with this ,company is also supplying
electro-chlorination equipments for purifying water  for
drinking and Industrial purpose. The erstwhile Mercury Cell
technology used in our country is now gradually converting
into Membrane Cell technology, which is opening huge
chance for company’s product. Even if the new cells need
not require coating in the initial few years of operation it
should be coated periodically thereafter which is a big
opportunity for the company. In last  year DNIL introduced
Platinized  Titanium Anodes  for  surface  finish application
in India .Company’s factory located at Goa is equipped with
most modern facilities and it is getting full support of its
parent company. Lying of large network of pipelines in oil
and gas sector,building of new bridges ,different type of
concrete protection requirements ..etc are expected to
bring good business for company’s Cathodic protection
division.On the negative side ,company’s business
have some cyclical nature,and is related with the fortunes
of Chlor Alkali industry which is now  started showing revival.
Secondly there was an order against the company  by the
Directorate General of Supplies and  Disposals, Ministry of
Commerce and Industry which restricts the company from
business with certain  government departments for a
period of five  years  .But, DNI  challenged this order and
in last month got an order stating that the time period
reduced to just one year starting from 22.02.2010.
Even if it may slightly affect the
performance in very near future,there is good scope
for its business in private sector and also in export front.  
DNI’ financial year ending is in the month of December.
Last financial year witnessed one of the worst performance
in recent past where company posted a turnover of Rs.13.45
Cr and a net loss of Rs.33 Lac(excluding other income).
But ,for the qtr ended June 2010 alone company posted a
sales of Rs.4.74 Cr v/s Rs.2.29 Cr and a net profit of
Rs 1.20 Cr v/s .58 Cr. Half year EPS is Rs.2.14 v/s Rs.1/- .
Company is very liberal in dividend payment which paid 50%
in 2004 ,70% in 2005 ,69% in 2006,58% in 2007,25% in 2008.In
2009, due to loss company skipped the dividend and it is
expected to give higher yield in this year due to better
prospects. Considering the support from the parent
company which is the world leader, revival in the user
industries ,chances of a turnaround performance ..etc
company may turn as a multibagger going forward.
CMP is Rs.79/-(Trading in both NSE and BSE)

Thursday, September 23, 2010


I have recommended a Buy and Hold on KAVERI SEED COMPANY from Rs.272/- level.Currently it is quoting around Rs.305/- .With a strong R&D,aggressive business strategies and an able management who knows the pulse of the agriculture sector - this is a stock to watch in any correction .I believe , KSCL is a perfect fit for those who are considering equity as an asset class and willing to hold for long term with patience to reap bumper crops.

Old report can be accessed HERE

Wednesday, September 22, 2010


Many times in the past, I  warned my readers about investing in companies with suspicious management .This is proved by the recent announcement of CONCURRENT INDIA INFRASTRUCTURE .Today the company in a filing to BSE declared that they have decided to withdraw from all major projects announced earlier. THIS IS A CLEAR CASE OF CHEATING POOR RETAIL INVESTORS AND THE AUTHORITIES SHOULD TAKE STRICT ACTION AGAINST THE PROMOTERS AND OPERATORS PLAYED BEHIND IT. 

Hope nobody trapped in this counter and once more urging everyone to make due diligence about the management before investing in any company especially small and mid caps .Companies with good management may move only based on their financial performance but chances are rare to loose your shirt in such counters.At current market price of Rs.21/-,just sell and run.


I have received lot of queries regarding the open offer made by the existing promoters of Vimal oil and foods @ Rs.51/-. As per the prevailing law, promoters can hike their stake through creeping acquisition method upto 5% in each financial year .But in this case they have  pumped an amount more than  Rs.30 Cr by subscribing 60 lac equity shares at a price of Rs.50.16/- through preferential issue . This is  way above the limit of 15%(upto open offer not applicable).Hence as per the rule ,it is a mandatory open offer. Since the market price is above open offer price ,chances are low to get shares in this offer till market price ruling above the open offer price . This means ,open offer @ Rs.51/- is not a reason to come down the share price to this level in any way.On the other side ,this development is really a positive one.Promoters are bringing huge money to the company itself is a sign of their confidence .This amount is expected to partly used for reducing debt  and balance for further business development ,which is positive for the company in the long run

This is to clarify some doubts raised by some readers as comments and through e-mail.

Sunday, September 19, 2010


In a country like India with huge population and increasing
disposable income , scope of companies from food processing
sector is very vast,especially those with good brands.But,
unfortunately many such brands are owned by unlisted
players or high priced MNC’s . Only very few companies
developed niche market and established their own brands
and growing handsomely. DFM Foods is one of such company
which is a dominant regional market player in snacks foods
sector. DFM is promoted by Delhi Flour Mills and had two
divisions till last year – Wheat storage Business and Snack
Foods Business. From last year onwards DFM discontinued
the low margin wheat storage business and now concentrating
only in snack foods division.Its brands  CRAX,NATKHAT,
WIZZ ..etc are popular in northern part of India.Last year
company expanded its capacity at a cost of Rs.13 Crore and
due to huge demand for its products now again planning to
expand the capacity further. Company is also taking steps to
make it a Pan India brand in few years from now.In last
financial year DFM’s snack foods division shows a growth
of 35% in turnover(Total turnover was less due to
discontinuation of wheat storage business).Net profit also
sharply improved from Rs.1.99 Cr to Rs.4.21 Cr backed by
better margins from snack foods division. In the first
qtr of this financial year(June qtr) company shows an increase
of 50% in its sales from Rs.13 Cr to Rs.20 Cr .With increasing
urbanization and changing life styles,demand for snacks
foods are expected to rise sharply and on the other side the
expected record production of wheat will reduce the pressure
of raw material cost which will help the company to record
better performance going forward. Earlier, company had an
image of a wheat trader and enjoyed only low valuation due
to the image of a trading company. But now it is a pure
FMCG/food processing like play and it should be re-rated
accordingly. There is good scope for appreciation from
current level of Rs.48/- 
* I have earlier mentioned DFM in MMB in Nov.2009

Monday, September 13, 2010


Jay Ushin is  jointly  promoted by  JPM Group
and Japanese company  USHIN Ltd in 1986.
Currently the foreign promoter holding 26% in
its equity.It is one of the  major  suppliers of
auto parts like Lock Sets, Latches,
Switches & Body parts to
major OEM’s in India.Company’s customer list
includes Mahindra and Mahindra,
Tata Motors, Maruti  ,GM,Honda ..etc.  Its  plants
are located at Gurgaon, Manesar and Chennai . Indian
automobile industry is cyclical in nature and closely
related with the trends in interest rate
and spending habits . Generally  rural spending is mainly
depends on good monsoon which is favorable in this year.
This is expected to keep  the current uptrend in auto
demand for some more time. Companies like Jay Ushin
are also a beneficiary of increased demand ,since they
are supplying products to well known OEM’s. For the last
financial year Company posted a turnover of Rs.357 Cr ,
net profit of Rs.6.6 Cr  and an EPS of Rs.17/ .For the three
months ended June qtr company’s turnover was Rs.101 Cr
v/s Rs.79 Cr , net profit was Rs.2.2 Cr v/s 1.29 Cr and EPS
was Rs.5.8 v/s Rs.3.3.Company also declared a dividend
of 25%. It is expected to post better results in few more
quarters. Don’t forget that the scrip and the industry as a
whole moved a lot in recent past and any significant upward
change in interest rate may de-rail the growth of this sector.
Considering other companies from the same sector ,it seems
to be relatively cheaply valued .Only high risk takers can
consider in limited quantity. CMP is Rs.159/-

Thursday, September 9, 2010


Due to the easing of recessionary pressure from
western economies ,Companies from textile
and related sectors are expected to perform
well in near future . Salona Cotspin
is a Tamilnadu  based company engaged in the
manufacturing of Cotton Yarn and Knitted fabrics.
Out of company's total sales, 41% income is
generated from Cotton yarn , 39% from
Knitted fabrics and balance from other
related products.Company is  planning to
expand its spindle capacity from 21744 to
24336 in near future and also planning to
increase the generation of wind energy to
reduce cost and ensure continuous supply
of power.For the financial year ended
March 2010 ,company posted a turnover
of Rs.55 Cr and a net profit of Rs.2.26 Cr
v/s a net profit of Rs.13 lac for
the last year. For the three months ended
June qtr of this FY ,sales is Rs.18 Cr  and
profit is Rs 1.25 Cr .On an
equity base of 5.32 Crore qtr EPS is
Rs.2.35.Company is expected to perform well
in near future .Even if company
is currently trading near its 52 week high ,
based on the expected full year performance
there is reasonable chance
for further upside.Movements in cotton
prices and power cut in TN are two factors
to watch.Currently it is trading around Rs.29/-

Tuesday, September 7, 2010


Conart Engineers is a Mumbai based construction company
specializing in Industrial, Commercial, Residential  projects
and roads and bridges. Even if the company is performing
well for the past many years ,it is ignored by the stock market.
Companiy’s client list includes well known names like
Alstom Projects,ABB,Advani Oerlicon, ABS Industries,
Camlin,Glaxo,Apollo Tyres..etc. Company is managed by
well experienced Engineers from ‘Sura ‘ family. For the last
financial year ,company posted a turnover of Rs .27 Cr , a net
profit of Rs.1.6 Cr and an EPS of Rs.5.5. Its order book is
above Rs.50Cr currently. After a long interval ,company has
declared a dividend in this financial year.
Currently it is trading with a market cap of just  8 Cr.
Considering the potential of the sector and experience
of promoters ,true investors can Buy below Rs.25 for
reasonable return in long term.CMP is Rs.28/-

Monday, September 6, 2010



Timex Group is one of the largest watch makers in the world
Its Indian arm TIMEX GROUP INDIA started its operations
in 1992 in  association with TATA group ,but later part their
ways and now working  independently. For the past many
years company was struggling to exist ,but now it showing
some signs of recovery. Company  wiped off all accumulated
losses and coming back to growth path after changing its entire
strategy. Now company is selling its brands TIMEX,
Etc through retailers and its own show rooms named ‘THE
TIME FACTORY’ .In the beginning of this year  , Mr Kapil
Kapoor from India has appointed as the COO of  Timex
Group’s worldwide operations . He is well experienced and
earlier with Nestle and Bausch & Lomb. After his appointment
as global COO, the Indian arm is enjoying more flexibility and
showing real improvement in all aspects. Now the company is
aggressively chalking out plans to capturing market share and
reducing costs. Currently company concentrating in price range
between Rs 500 and Rs 5,000 and claiming a market share of
21 % in this category. Company is now seriously thinking about
re-positioning its brands in other price category too. There is
also fair chance for brand extension to other lifestyle products
going forward. In first qtr  June 2010 ,sales grew 45 per cent,
while profits grew 107 per cent over the corresponding period.
Company posted a NP of Rs.5 Cr in this qtr where in last
FULL YEAR  it posted Rs.4.6 Cr only .Company having an
equity base close to 10 Cr  ,out of this almost 75% held by the
foreign entity. In order to clean up  the balance sheet ,company
reduced its FV to Rs.1/- and write off the balance earlier.
Considering the renewed interest of the management and
aggressive steps taken in recent past ,it is expected to perform
well going forward. But one should consider the fact that the
share price has run up sharply after the declaration of June
qtr result and now trading around its 52 week high .
One should keep watching and enter in a correction .
Currently it is trading around Rs.46/-

Saturday, September 4, 2010


Superhouse Ltd is the flagship company of
superhouse group which is one of the largest
exporters of finished leather from India.
Company is supplying products to major
global brands like Tuff Tusker,Heckle,
Bulwark,Stabilus ,Secura,
Schutz ,Hauf ,HKS ,Globex, and EWS .
Apart from this company is selling its  two
brands  in India ‘Allen Cooper ‘ and
‘Double Duty’ through company owned
Allen Cooper shops. Company have six
subsidiaries -  M/s Superhouse (UK) Limited, 
 M/s  Superhouse (USA) International Inc,
M/s  Superhouse  Middle East FZC,
M/s Superhouse R.O. S.R.L.,Super House
HK  Limited ,M/s Superhouse R.O. S.R.L.
and Super House Canada  Inc.Superhouse group
 having 15 manufacturing units across India and
an annual turnover of Rs. 4,000 million .
Historically companies from this industry
commanding low valuation in Indian Stock
Market. But recent changes in export incentives
are expected to boost the performance of
companies from this sector and trigger for
a re-rating in this sector.In the last financial
year company posted a turnover of Rs.358 Cr
and a net profit of  Rs.14 Cr .On an equity base
of 11.4 Cr EPS was Rs.13.25/- .For the june qtr
of this FY company posted NP of Rs.3.48 Cr v/s
Rs.2.54 Cr.It is currenly trading with  a P/E ratio
of 4.6 on last full year EPS . At CMP of just Rs.62/-
it is a real valuepick

Wednesday, September 1, 2010


Earlier I have recommended an AVOID on Sturdy Industries mainly because of my Skepticism on the management of this company.Today they have informed BSE that the company dropped their plans to issue

preferential allotment of warrants to promoter and non promoter category. Just before this ,company announced an allotment of preferential warrants to some FII's and later cancelled this decision too. Hope the promoters and related parties offloaded maximum shares after announcing such positive development to poor retailers . These types of promoters are many in our market .SO BEWARE...


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