The long wait is over and the outcome is clear. Fortunately
it is a clear mandate which may help the government to take bold decisions to
revive the economy and that is the need of the hour.Lower number in Rajya Sabha
for the ruling party may be an issue in certain cases for the initial years ,but over
all situation will be far better than the recent past . Another threat for economy
in near future may in the form of monsoon which is beyond everyone’s
control.Let us hope for the best in this case too. As we are aware ,the recent
run up was very sharp on expectation of
a strong government . So it is the time to react to the reality. Some profit
booking can’t be ruled out once the initial celebration ends.I hope my readers
will show enough prudence while selecting stocks in a volatile market condition
and give priority to quality and value in stock selection.
‘Power’ is important not only in politics but for the growth
of any economy.In recent past ,due to lack of clear majority in parliament govt
could not take any bold steps to increase power production .Lot of small and
large projects stuck at different stages due to policy paralysis especially related with
land acquisition ,environmental clearance ...etc. I hope ,the new government
will give priority to this sector which is the backbone of any industry in any
country.So this week selecting a stock which will be a beneficiary for
additional capex and expansion in power sector. Sunil Hitech Engineers ( SHEL) is a Maharashtra based company .Hard work,acumen and
grace of god is the perfect combination for success in business and growth of this
company is a testimony for that. Started
by Mr Ratnakar Gutte ,a high school dropout with just Rs 2,000 as capital
,Sunil Hitech now turned as a Rs.1500 Cr turnover company . Now company is
professionally manged with the help of his two sons -one a mechanical engineer
and the other an MBA.
SHEL specializing in fabrication, erection and commissioning of power plants.In addition to power plants ,company executing Lump sum turnkey (LSTK) contracts of Transmission & distribution projects, Steel Plants, Sugar Industries, Process & Piping Industries, irrigation projects ..etc .Company is one of the few qualified contractors for BOP works up to 660 MW .Comany’s marquee clients includes NTPC,BHEL,Alstom Energy Corporation,L &T,JSW Steel,JSW Energy ,BALCO ..etc and various state electricity boards.At the end of FY 2013 SHEL’s order book position was Rs.2300 Cr .
SHEL specializing in fabrication, erection and commissioning of power plants.In addition to power plants ,company executing Lump sum turnkey (LSTK) contracts of Transmission & distribution projects, Steel Plants, Sugar Industries, Process & Piping Industries, irrigation projects ..etc .Company is one of the few qualified contractors for BOP works up to 660 MW .Comany’s marquee clients includes NTPC,BHEL,Alstom Energy Corporation,L &T,JSW Steel,JSW Energy ,BALCO ..etc and various state electricity boards.At the end of FY 2013 SHEL’s order book position was Rs.2300 Cr .
In FY 2012-13 ,on a consolidated basis ,company reported a
top line of rs.1253 Cr , a net profit of Rs.55 Cr and an EPS of Rs.29 . During
the latest March quarter promoters hiked their stake from 53 % to 58 % by
subscribing shares on preferential basis .In addition to this ,they also
subscribed warrants which will be converted into equity shares within 18
months.On full conversion of these warrants promoters stake will again rise to
66 % .Pumping of this additional funds by promoters will help the company to
reduce its dependency on debt and some comfort on working capital side. Ashish
Dhawan – a well known investor and co-founder of P/E firm ChrysCapital holding
close to 2 % stake in SHEL in his personal capacity .
I believe, the emerging scenario will be very positive for a company like Sunil Hitech
Engineers .Stock is valued cheaply at CMP Rs.76 with a P/E multiple of less
than 3 and its current market cap is just 1/15th of its last year consolidated top line . Recommending as a BUY @ CMP of Rs.76 for long term investors.Stock listed both in NSE and BSE
Link to Latest Annual Report HERE
Disc : It is safe to assume that I have vested interest in SHEL
Sir,
ReplyDeleteThank you for the wonderful pick at right time.
Can we accumulate REI Agro due to recent downfall? Need your guidance Sir!
Regards,
Raj.
Early prediction of below average monsoon and possibility of strength in Rupee value does not make REI agro a compelling buy at present situation.
DeleteSir very good pick. Only concern for me in this segment is the receivables stuck with state and central clients which can put serious strain on the cash flows. Good potential if co focus on exports to Latin Am and Africa also.
ReplyDeleteHowever debt seems to be normal here. Thanks for this pick.
I believe there will be some strong initiatives to strengthen SEB 's financial condition ,going forward.SHEL not only servicing public sector cos but many pvt cos too
DeleteHi,
ReplyDeleteJust looked into balance sheet.Interest paid is quite high.Its 19.51 and net profit is 6.26. I saw same trend in the last 4 quarter.
That's why now promoters are bringing more money in form of equity
DeleteDear vpji
ReplyDeleteWhat could be effect on super house ltd of NDA government. Should I hold as stable govt ruling India. Or exit at cmp. may I add more share at curring rate as if you view same as recommend time. Tell me sir
Read the news item in the below link .If it happens ,it may affect all leather exporting cos
Deletehttp://timesofindia.indiatimes.com/home/lok-sabha-elections-2014/news/Will-the-BJP-curb-beef-export-if-it-comes-to-power/articleshow/34953958.cms
Sir, thanks for the excellent pick once again hope this stock could reach at least to its book value within couple of years.Plz suggest me future of kalindee rail .I am holding this stock from year 2008.Company has turned around nicely in previous quarter Also texmaco rail is holding stake nearly 40% in this company. Should I sell it at current price or wait till budget or hold it for long term.
ReplyDeleteNot tracking ant railway stocks
DeleteDear sir after today's meeting kalindee rail has informed amalgamation with texmaco rail. sir plz suggest whether to still hold kalindee rail or sell the same swap ratio is 106 shares of texmaco rail for 100 kalindee rail shares.
DeleteHi VP,
ReplyDeleteDue to election results, expectation of rupee strengthening and bad monsoon predictions, are there any stocks recommended in recent few months that better to move out of?
I hear, infra and banks are expected to do well going forward, any good pick in these areas?
Thanks in advance!
Let us wait for a while to see What RBI is doing
DeleteWhat is your view on premier ltd.
ReplyDeleteBefore also i ask about it but didnt get reply...
Not tracking it.
DeleteSir, can u explain about rights issue? Purpose? and it's effect on company and shareholder?
ReplyDeleteRights issue ? which company's ?
Deleteany company..what is rights issue?
DeleteSir,
ReplyDeleteI am very new to ur sight n its very interesting. I am a sincere investor n interested to keep the good shares for a very long term. Definitely I will buy SHEL tomorrow n keep it till ur sell recommendations.
N I have 2000 shares of KVB. Whats ur view on it. Its average price is
Rs 405 bought at different levels since from 2011.
Hold KVB
DeleteYour recommendations are quite ahead of time . granules still not part of any MF buy list. I am sure next year when the price has already appriciated MF will rush to buy it.
ReplyDeletesir, Pharma and IT companies are hitting hard mainly larg caps..but not impacting our mid n small companies much, recommended by you...but still any advise or words of cautious you want to give?
ReplyDeleteThanks
Mayur
Investors are churning their portfolio post election and some exit from pharma /IT sectors expected due to a possible strengthening of Rupee. But RBI may play a role to prevent any sharp appreciation to save domestic industries. We should wait an see upto which extent this will happen .Stocks from these sectors may consolidate in next few days after this volatility.No need to press panic button , stocks with different beta is good for a balanced portfolio.
DeleteDear VP,
DeleteWell said. Thank you :)
Sir, What is your view on Castol India?
ReplyDeleteNot expecting any big out performance from Castrol.
DeleteYour old recommendation Astra microwave products doing well .still holding
ReplyDeleteThank you vp
Sir,
ReplyDeleteADOR WELDING that u have recommended at 123/- appreciated by 20 rs today....more than 14% rise..
Is it due to strengthening of rupee day by day, almost all Pharma Stocks are falling every day. Request your coveted advise on Granules India Ltd. Hold/Sell/Purchase
ReplyDeleteWithout looking left and right m people selling such stocks .But many of these companies from pharma sector importing their raw materials,loans from overseas ,methods to hedge the fluctuation..etc .If good stocks from pharma sector caught in more than enough correction ,one should definitely look into such stocks too..
DeleteSir,
ReplyDeleteApar Industries appreciated in last two days from 150 to 210. Kindly inform you views
Please share your views on Freshtrop Fruits Ltd
ReplyDeleteExtreme seasonality in business is a reason for lower valuation
DeleteSir,
ReplyDeletePlease share your view on logistics stocks i think this sector has very good potential because of growing trend of online shoping. Please share the picks in this sector if you have any. Thanks
Positive on the sector
DeleteSir what should the stop loss of SUNIL HITECH ENGINEERS LTD
ReplyDeleteI am not a technical analyst to provide support,resistance ..etc. My stock suggestions are purely based on fundamentals and I believe stock is an asset.Hence ,if an asset is available at low price (when other things remaining than the same.) attraction will only increase.
DeleteSir can you pleasebahare your view on wonderla?
ReplyDeletePositive on Wonderla
DeleteSir
ReplyDeleteYour view on LG Bros & Deepak nitrate. Both are bonus candidate
Not tracking LGB,Deepak Nit .recommended at much lower rate
DeleteThank you sir
Deletesir can you please share your view on sintex india?
ReplyDeleteNot tracking it.
DeleteHello Sir..whats your view on mayur uniquoters?
ReplyDeletewhat abt kernex micro,aarti industries and exide.plz guide me holing all of these
ReplyDeleteI am buying SHEL stock for the past 4 years from 170 - 40 on various prices. I am happy to see VP has same view as mine. I am holding big chunk and planning to hold for next 10 years. Do you think this stock is good for long term investment like 10 years?
ReplyDeletePlease suggest some mid cap for long term investment say for 10 years. I am slowly accumulating orient bell ( so far bought 3000 at avg price of 48). can i buy more?
Thanks
Babu
Hi Sir,
ReplyDeleteMay i know when can i Exit in this stock.
Could not understand your question ?
Delete