Saturday, May 11, 2013

CUMMINS INDIA - BUY







This Pune based company  is a 51% subsidiary of  Cummins Inc of USA.It is one of the largest manufacturers of Diesel Engines in India .Company’s products are used in industries like Auto,Power Generation..etc.Company having manufacturing facilities to  produce Diesel Engines with a capacity of 18 HP to 3500 HP.In fact ,Cummins is one of the biggest beneficiary of India’s  power deficit  which may  continue for many years due to lack of proper policy decisions and uncertainties related with environmental clearance issues. Company currently commanding a 35 % market share of DG set business and they are now going  to start the production of  Low Horse Power Gensets in near future.This new facility is under implementation at Phaltan with a production capacity of  50,000 gen sets which will be commissioned in next one year.Honda Siel Power is currently dominating low HP genset market .With advanced technology and well accepted brand name , Cummins is expected to give tough competition to Honda going forward.Parent Company is paying maximum attention to develop business here and planning to make India as a production hub for their overseas demand too.Company is spending large amount for R&D and established a separate wing for this purpose only.Demand for other Industrial purpose engines are also expected to improve with a revival in over all economy. 





Even in this tough business environment company reported a 30% rise in its net profit for the latest March quarter.It is one good company to be included in the core portfolio of long term investors @ CMP of Rs.520/-


Link to company website HERE

39 comments :

  1. Sir wish you many many happy returns of the day....God bless you....Anand

    ReplyDelete
  2. Value Pick,

    Thanks for yet another recommendation. Wish you a very happy Birthday. Keep them coming :)

    ReplyDelete
  3. Sir,
    You haven't mentioned any vested interest. Does it mean you holding to recommending to your followers?

    Its an excellent company and good goverance.

    Certain stock in one's portfolio.

    thnx

    ReplyDelete
  4. Dear VP,

    All your recommendtions in this blog are good value picks, but unfortunately most of the stocks have very thin volumes & any times these can be shifted to illiquid category. SEBI's rule of auction trading for illiquid stocks is like killing the patinet instead of curing the disease. Although these are all good value bets, investors should be really cautious of investing in these scripts. Do you have any idea if there is any pressure on SEBI to change this rule of auction trading? I believe even the Stock exchanges might have been hit due to lack of trading volumes. Some how these Indian markets are not favorable to investors these days. Small caps & mid caps where usually investors put their money are badly underperforming & on top of it SEBI's stupid rule of auction trading..only God can save investors in Indian markets!!!

    ReplyDelete
    Replies
    1. Agree with you ,this is one of the big anti investor move initiated by SEBI in the past many years.But the most surprising thing is- even the BSE is not bothered about it and not protested so far.I believe they will realise the implication once more and more cos included in this list. Many investors are refrain from mid/small caps in these days only because of the possibility of inclusion in this method.Let us wait and see whether SEBI will consider at least some modifications in the criteria for selecting illiquid stocks in their next revision .

      Delete
    2. Exactly and very find observation and also answer by VP. Let us see how SEBI will come out on this. Madhava Kumar

      Delete
  5. VP Sir, I have almost 20 shares of "TECPRO SYSTEMS" and few "TRF" shares with me. I saw your comment regarding Periodic call auction for TECPRO. Shall I hold it or sell it immediately. Please suggest
    Regards,
    Harsha

    ReplyDelete
    Replies
    1. Dear Friend

      Business of both these cos may improve with over all industrial growth of our country,regarding PCA -Wait till the next revision ,let us see whether SEBI is willing to change.

      Delete
  6. Sir,
    Your comment on "Just Dial" IPO please. Is it worth applying for?

    Thanks,
    Sunil

    ReplyDelete
  7. Dear sir,

    what happened to VA Tech wabag, continues to fall, any special reason...

    ReplyDelete
  8. Sir,

    what is your view on KALE Consultant like Buy or Hold.

    Thanks,
    Raj

    ReplyDelete
    Replies
    1. Kale recommended just one year back @ Rs.126

      http://value-picks.blogspot.in/2012/07/kale-consultants-ltd-buy.html

      which is currently trading @ Rs.462 ,one should at least take the cost plus reasonable profit at this level.

      Delete
  9. Sir,

    what is your view on La opala's after the result..

    thanks,
    Raj

    ReplyDelete
  10. VP Sir,
    It appears that Lactose India liquidity = zero.
    A sell transaction gets cancelled automatically within seconds.
    Is the light at the end of the tunnel permanently switched off for this counter?

    ReplyDelete
    Replies
    1. This is the contribution of our SEBI to retail investors like us in the form of PCA.

      Delete
  11. What is your view on l&t finance

    ReplyDelete
  12. Dear VP,
    This may have been asked before but please help me with this query. I would be grateful if you could suggest on what to do with Mangalam Cement. I bought 400 @ 151 and it is now trading at 118. Should I accumulate or sell?
    Thank you,
    Chitra

    ReplyDelete
    Replies
    1. Company is expanding its capacity now .If you can wait till some revival in Infrastructure - Real Estate space ,HOlD it

      Delete
  13. sir your views about PCS industries.. the kinda of money they are putting through preference allotment, shows the confidence patni group has in PCS, can we look to invest further. ive already invested at 17rps

    And shares like vulcan engineer which are currently out of flavor in market.

    ReplyDelete
  14. Normally small and mid caps stocks are the favorite of retail investors and institutions are not interested in such stocks.Unfortunately after the introduction of Periodic Call Auction by SEBI ,retail investors are not showing any interest to invest even in quality stocks only because of this new system.Only time will tell whether SEBI will do something or people will gradually change..

    ReplyDelete
  15. Dear VP,

    I had posted a question about MRO-TEK, looks like you missed that question.

    Regards,
    Jay

    ReplyDelete
  16. sir what is your view on poly medicure , now ?

    ReplyDelete
  17. Already turned as a multi bagger from initially recommended level ( 2 bonus issues) .Still a HOLD

    ReplyDelete
  18. Could you please share your view On SREI INFRASTRUCTURE FINANCE LTD

    ReplyDelete
  19. do we need to buy Cummins now??? i bought @ 510

    ReplyDelete
    Replies
    1. No need to worry ,Hold it and add more in further dip (if any)

      Delete
  20. Could you please throw some light on brand house retail , the share has plummeted down from 15 levels to 2 despite co having a strong retail presense

    ReplyDelete
    Replies
    1. Already expressed my negative opinion on S Kumar's ( Kasliwal )group and not recommending any cos from this group even if it is available at any valuation.

      Delete
  21. Dear VP Sir
    Empire Industry is giving high dividends.But it has become illiquid.What is your opinion?

    Prashanth

    ReplyDelete
  22. I also feel stock like CUMMINS is must in good long term portfolio. As on date stock is with 8 Rs Dividend and if there is chance to add below 450 it is worth by all means.

    ReplyDelete
  23. Dear Valuepick,

    I would like to have your views about Nucleus Software.
    Company has declared numbers for Quarter ending June 2013 and looks quite decent.

    ReplyDelete
    Replies
    1. Management of Nucleus seems struggling to grow the company to the next level

      Delete

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