T I M E S: Market Yearns For Fresh Triggers

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T
VOL. XXIV No.40
A TIME COMMUNICATIONS PUBLICATION

Monday, 10 16 August 2015
S
Pages.22 Rs.15
Market yearns for fresh triggers

By Sanjay R. Bhatia
The markets moved higher on the back of follow-up buying support. Although occasional bouts of profit booking and
selling pressure were witnessed at higher levels, the markets managed to trade in profit. The FIIs remained net buyers
both in the cash and derivative segments. Domestic institutional investors, however, were seen booking profits at higher
levels and remained net sellers during the course of the week.
The breadth of the market remained positive amidst higher volumes, which is a positive sign for the markets. On the
domestic front, the government struggled in the Parliament as
the political logjam continued. The RBI maintained a status
quo in its monetary policy review. On the global front, crude
oil prices continued to trade soft while precious metals moved
downwards. The US markets remained cautious ahead of the
weekly jobs data, which could encourage the US Federal
Reserve to raise interest rates in September 2015.
Technically, the prevailing positive technical conditions
helped the markets witness follow-up buying support at
higher levels. The MACD, KST and RSI are all placed above
their respective averages on the weekly charts. Further, the
RSI is also placed above its average on the daily chart. The
Nifty continues to sustain above its 50-day SMA, 100-day SMA
and 200-day SMA. These positive technical conditions would
lead to regular buying support.
However, the prevailing negative technical conditions still hold good and would weigh on the market sentiment at
higher levels. The MACD, Stochastic and KST are all placed below their respective averages on the daily charts. Further,
the Stochastic is placed below its average on the weekly charts and is also placed in the overbought zone on the daily
and weekly charts. The Nifty's (50-100 day SMA) and (50-200 day SMA) Death Cross breakdown continues to hold valid.
All these negative technical conditions would lead to intermediate bouts of profit booking and selling pressure especially
at higher levels.
The +DI line and the -DI line both are still converging on the weekly charts and a decisive breakout is awaited. The ADX
line, on the other hand, continues to languish around the 15 level, indicating that the market trend lacks strength and a
range bound trend is expected. Now it is important that the markets witness follow-up buying support at higher levels
and the Nifty continues to sustain above the 8525 level for the rally to continue and for the Nifty to move higher.
The earnings season has largely remained disappointing along with the monsoon session of Parliament. The global cues
are also uninspiring. With a lack of positive triggers, the markets are likely to struggle at higher levels and the current
rally would always remain under threat especially amidst the prevailing overbought conditions.
A Time Communications Publication
The Nifty 8520 level remains a support level. In the meanwhile, the markets would take cues from the earnings season,
Parliament session, forthcoming RBI meet on monetary policy, monsoon progress, Rupee-Dollar exchange, global
markets, and crude oil prices.
Technically on the upside, the BSE Sensex faces resistance at the 29094 and 29184 levels but seeks support at the
28088, 27248, 26776, 26469, 26108 and 25910 levels. The resistance levels for the Nifty are placed at 8610, 8655 and
8867 levels while its support is placed at 8525, 8425, 8315, 8191, 8065, 8000 and 7940 levels.
BAZAR.COM
Investor's open flirt.....!!!!!

Last week was singularly unique as the market benchmark looked tired and fatigued but high net worth investors and
their high retail inflows seem to be flirting openly with the mid-caps and small-caps. Over 50 mid-caps hit new record
highs thanks to the domestic investors appetite for smaller companies, which drove the mid-cap index to a new high.
The likes of Sanofi, Tata Elxsi, Welspun India, PC Jewellers, FAG Bearings, Tube Investments, IGL etc recorded new highs
on large volumes. Its observed that the Sensex has gained only 2.5% in the last 90 days, while the BSE Mid-cap and
Small-cap have gained 7.5% and 7% respectively.
Mega blockbuster returns from 8th edition of Beat the Street 9
No wonder, retail investors, HNIs and institutional
On 8th June 2015, we published the 8th edition of Beat the Street
investors are seen flirting with such scrips and in
9. Within just one month 7 of the 9 stocks have given blockbuster
sectors such as Textiles, Tyres, Aviation, Chemicals
returns!
and Paints, which have managed to post strong
gains thanks to the fall in crude prices. Market
Infosys recommended @ Rs.975 (ABP) zoomed to Rs.1127
pundits feel that such open flirting shall continue as
levels and recorded 18.63% appreciation.
long as the inflow of money in the market is robust.
KEI Industries recommended @ Rs.63 zoomed to Rs.109 level
"The rally in mid-cap and small-cap stocks is a sign
and recorded 73.01% appreciation.
that retail investors are aggressively buying. The
Sunil Hitech Engineers recommended at Rs.193, zoomed to
trend seen in the last few weeks is that domestic
Rs.343 level and recorded 77.72% appreciation.
money is chasing mid-cap stocks while the FIIs are
Dish TV India recommended @ Rs.95 zoomed to Rs.120.6 level
investing in large caps" says Raamdeo Agrawal, Joint
MD, Motilal Oswal Financials.
Indian Hume Pipe Company recommended @ Rs.288, zoomed
to Rs.422 level and recorded 46.52% appreciation.
The same sentiment is echoed by Nilesh Shah,
Bajaj Electricals recommended at Rs.264, zoomed to Rs.310
MD, Kotak Securities when he says "There is huge
level and recorded 17.42% appreciation.
domestic money from HNIs and retail chasing mid DCB Bank recommended at Rs.125, zoomed to Rs.151 level
cap stocks despite many of them being overvalued.
The demand is more for companies where the fresh
issuance of new shares are limited."
Our subscribers have earned handsome profit in the above stocks.
RBI Governor, Raghuram Rajan, during the week
Now the 9th Edition will be released in the first week of September
kept repo rates unchanged on inflation worries but
2015. For blockbuster returns like the above, dont wait till
struck a dovish note on economic recovery. Home
September. Book your subscription from now.
loans and other borrowings shall get cheaper he
For more details contact Money Times.
said with RBI asking the commercial banks to pass
on the benefits of earlier rate cuts to borrowers.
Subscription Rate: 1 Quarter: Rs.3500, 2 Quarters: Rs.6500, 3
"Since the first rate cut in January 2015, the median
Quarters: Rs.9000, 1 Year: Rs.11000
base lending rates of banks has fallen by around 30
Contact Money Times on 022-22616970/22654805 or
basis points - a fraction of the 75 basis points in the
[email protected]
rate cut so far. As the loan demand picks up in
Q3FY16, banks will post more gains from cutting
rates to secure new lending as more transmission will take place. The welcome announcement of the government
infusing fresh capital into public sector banks will help the loan growth and hence transmission, as will current easy
liquidity conditions" said Rajan.
Bankers claim that the higher rate on PPF deposits and on small saving schemes, that are competing with commercial
banks and disallows them from reducing the deposit rates. The banks, therefore, see muted growth in deposits and the
credit growth is trailing, which keeps the banks from adding more deposits and hence effect deposit rate cuts.
Anil Ambani led ADAG is entering a chopper building facility at Mihan near Nagpur. A smart city-the first of its kind
called Dhirubhai Ambani Aerospace Park (DAAP) will be developed at a cost of $1 billion to manufacture helicopters for
both commercial as well as defence applications. This could well be a beginning in capturing a slice of projected
$100 billion defence manufacturing pie, which is part of NDA's Make in India plan.
Hero MotoCorps Q1FY16 results ignite hope in an otherwise lacklustre segment. The new launches as well as strategic
marketing initiatives have made it possible to deliver a 33% boost to the bottom-line despite a 2% declining top-line.
Of the fifty Nifty stocks, FIIs have reduced their stakes in 41 stocks in the April to June quarter. On an aggregate basis,
they have reduced their holdings to 28.6% from 29.2% in the preceding quarter. The FIIs reduced their stake by nearly
2% in Hindalco, Tata Motors, Zee Entertainment, BoB and Hero MotoCorp.
Projecting the country's highways sector as unique opportunity for investments, the government has rolled out projects
worth Rs.6 lakh crore.
All this happening amidst the stalemate in Parliament and suspension of 25 Congress MPs!
God save the country from our rulers.
TRADING ON TECHNICALS
Mid caps outperform Sensex

By Hitendra Vasudeo
Last week, the
Sensex opened at
Last Close
28089.08, attained
a low at 27866.11 and moved up to a high 28359.96 before it finally closed the week at 28236.39 and thereby showed a
net rise of 121 points.
A breakout has not yet been witnessed but volatility and choppy movements were still seen intra-day last week.
Weekly Chart
Weekly resistance will be at 28463-28576. The higher range for the week can be 28442-28936. Support will be at
28089-27866 for the week.
The next support cluster points are at 27416 and 27209.
A breakout and weekly close above 28600 is essential with a
bullish candle for a rally to test back the peak.
Expect profit booking pressure at the higher range on index
and index related stocks.
Weakness & correction with choppy volatility will resume on
a fall below 27866. Wider volatility will be seen on a fall and
close below 27866.
The wider volatility band is 28576 to 27209.
A rising wedge has been formed and a breakout and weekly
close above 28576 is essential. Failure to cross 28576 and a
poor weekly close below 27866 can end the Wave (b)
structure and the Wave (c) structure can open up.
Monthly Chart
The high and low of July 2015 was 28578 and 27416. The movement has to get out of the band up or band down to show
directional movement in August 2015 or later.
BSE Mid-Cap
BSE Mid-Cap index has shown a breakout above 11180 and 11193 peak that ruled since March 2015. The expected level
to be attained is 11912 from the current level of 11557. This means that mid-cap stocks still have to perform in days to
come with volatility.
Strategy for the week
Traders long can keep the stop loss at 27200. Buy above 28600 with the low of the week as the stop loss or 28000,
whichever is lower. Profit booking is to be undertaken at higher level of 29094, 29533 and 30024.
Sensex
28236
DRV
27901
Daily Trend
UP
WRV
27540
Weekly Trend
UP
MRV
26306
Monthly Trend
UP
Mid-cap stocks will be in action and buying of mid-cap stocks can extend the rise to 11912.
WEEKLY UP TREND STOCKS
Let the price move below Center Point or Level 2 and when it move back above Center Point or Level 2 then buy with whatever low
registered below Center Point or Level 2 as the stop loss. After buying if the price moves to Level 3 or above then look to book profits as
the opportunity arises. If the close is below Weekly Reversal Value then the trend will change from Up Trend to Down Trend. Check on
Friday after 3.pm to confirm weekly reversal of the Up Trend.
Scrips
VARDHMAN TEXTILES
BRITANNIA INDUSTRIES
HIND.PETR.CORP.(HPCL
MARUTI SUZUKI INDIA
TATA ELXSI
Last
Close
Level
1
Level
2
Center
Point
Level
3
Level
4
Relative
Strength
Weekly
Reversal
Value
Up
Trend
Date
941.00
3202.00
970.00
4452.00
1874.00
Weak
below
804.0
3074.0
899.0
4375.0
1702.0
Demand
point
843.7
3104.0
920.0
4388.3
1738.0
Demand
point
901.3
3172.0
949.0
4438.7
1838.0
Supply
point
998.7
3270.0
999.0
4502.3
1974.0
Supply
point
1153.7
3436.0
1078.0
4616.3
2210.0
73.8
73.2
73.0
71.7
71.4
801.0
3034.3
918.8
4302.5
1625.5
19-06-15
15-05-15
22-05-15
17-07-15
17-07-15
WEEKLY DOWN TREND STOCKS

Let the price move above Center Point or Level 3 and when it move back below Center Point or Level 3 then sell with whatever high
registered above Center Point or Level 3 as the stop loss. After selling if the prices moves to Level 2 or below then look to cover short
positions as the opportunity arises. If the close is above Weekly Reversal Value then the trend will change from Down Trend to Up
Trend. Check on Friday after 3.pm to confirm weekly reversal of the Down Trend.
Scrips
Last
Close
CAIRN INDIA
JSW ENERGY
VIJAYA BANK
GAIL (GAS AUTHORTY O
RURAL ELECTRIFICATIO
167.00
77.05
40.35
341.70
266.80
Level
1
Level
2
Center
Point
Level
3
Level
4
Demand
point
Demand
point
Supply
point
Supply
point
Strong
above
151.9
65.8
37.7
320.2
244.8
162.6
74.2
39.6
336.0
261.0
169.0
79.7
40.8
346.2
271.4
173.3
82.5
41.5
351.9
277.2
175.3
85.2
42.0
356.4
281.9
Relative
Strength
Weekly
Reversal
Value
Down
Trend
Date
30.58
32.96
34.10
34.73
36.79
171.24
89.50
40.63
357.53
279.08
07-08-15
24-07-15
17-07-15
03-07-15
24-07-15
EXIT LIST
Last
Close
Supply
point
Supply
point
Supply
point
Strong
above
VINATI ORGANICS
505.45
526.39
533.00
539.61
561.00
414.4
GUJARAT PIPAVAV PORT
214.40
222.83
225.73
228.62
238.00
173.7
44.9
ARVIND
304.80
309.64
313.05
316.46
327.50
251.8
45.35
ACCELYA KALE SOLUTIO
1031.00
1098.37
1123.50
1148.63
1230.00
672.4
46.13
98.85
101.88
103.30
104.72
109.30
77.9
47.07
Scrip
PRISM CEMENT
Demand Monthly
point
RS
36.79
ALSTOM T & D INDIA
520.30
529.80
535.85
541.90
561.50
427.2
47.63
HDFC (HOUSING DEV.FI
1299.00
1313.30
1320.50
1327.70
1351.00
1191.3
48.24
MONSANTO INDIA
3170.00
3234.10
3261.00
3287.90
3375.00
2778.1
48.59
CENTURY PLYBOARD
195.55
203.77
206.68
209.58
219.00
154.5
48.68
J.B.CHEMICALS & PHAR
253.85
269.71
275.00
280.29
297.40
180.1
48.97
HINDUSTAN UNILEVER
906.00
909.55
912.50
915.45
925.00
859.6
49.54
MBL INFRASTRUCTURE
268.60
269.55
272.50
275.45
285.00
219.6
49.89
TAKE SOLUTIONS
139.05
144.64
147.00
149.36
157.00
104.6
52.04
KIRLOSKAR OIL ENGINE
299.75
313.72
319.50
325.28
344.00
215.7
53.09
BUY LIST
Scrip
Last
Close
Demand Demand
point
point
Supply
Point
Supply
Point
Risk
Reward
Monthly
RS
272.96
JUBILANT LIFE SCIENC
286.00
280.99
259.95
315.0
349.1
68.58
JUBILANT FOODWORKS
1923.95
1897.39 1885.00 1872.61 1832.50
2002.4
2107.4
61.14
276.98
Weak
below
SWARAJ ENGINES
994.00
982.58
967.00
951.42
901.00
1114.6
1246.6
55.09
PUNTER'S PICKS
Note: Positional trade and exit at stop loss or target whichever is earlier. Not an intra-day trade. A delivery based
trade for a possible time frame of 1-7 trading days. Exit at first target or above.
Scrips
BAFNA PHARMA
BHANDARI HOSIERY EXP
GANESH ECOSPHERE
GOL OFFSHORE LTD
ORIENT GREEN POWER
PNC INFRA
USHER AGRO
VEDAVAAG SYSTEMS
BSE
Code
Last
Close
Demand
Point
Strong
above
Weak
below
Supply
point
Supply
point
Risk
Reward
532989
512608
514167
532786
533263
539150
532765
533056
28.85
58.35
174.00
62.35
14.78
481.10
43.20
22.35
26.55
56.95
169.90
61.45
14.68
465.00
40.25
21.70
30.60
61.70
175.40
65.15
15.29
484.10
43.60
22.55
25.20
53.40
157.10
59.70
13.65
451.00
38.60
20.25
33.9
66.8
186.7
68.5
16.3
504.6
46.7
24.0
39.3
75.1
205.0
74.0
17.9
537.7
51.7
26.3
TOWER TALK
Marketmen and dealers advise investors to avoid the Power Mech Projects IPO on grounds of overvaluation.
Balkrishna Industries which makes off the road (OTR) tyres is performing extremely well and enjoys a near
monopoly in the market. Buy for an electrifying price rise.
Rising volumes in Coal India suggest that Q1FY16 results this week may be good. The share is poised for a
substantial rise.
New facilities at Ceat Tyres will enable it to post much better returns from the next quarter. Buy immediately for
handsome profits.
The results of Motherson Sumi Systems have not been properly interpreted by investors. While speaking to
CNBC18, management has clarified that the depreciation of the Yen and Euro resulted in lower profits and that the
actual sale is higher than in the previous quarters.
FMCG major, Marico, is on a major threshold to launch many products and post better profits this year. Buy for
decent capital appreciation.
The ongoing expansion plans at Siyaram Silk Mills will add to its ever increasing profits. A 50% in share price rise
is a distinct possibility in the next 6 months.
Nath Bio-Genes (India), not so well-known, will benefit from the good monsoon and boost earnings in the coming
months.
Nitin Fire Protection Industries is all set to recover its lost glory. Buy immediately before time runs out.
Cadila Healthcare will launch some its most profitable generic versions of patented dugs soon. Buy with a medium
range target of Rs.2500.
The NIIT management has stated to the media that the best time for the company starts now. Buy and sit tight for
two years for handsome gains.
Sathavahana Ispat is seemingly doing well and is reporting rising volumes. Is something cooking? Brave hearted
investors may buy for equally rewarding times.
BGR Energy Systems, which has seen dizzy heights in the past, has posted good results. Buying at this stage can
give excellent returns.
KPIT Technologies has proved that false rumours cannot force its share price down. This Kirloskar group company
has the potential to cross Rs.200 again.
SNL Bearings has been moving up smartly. It is a subsidiary of NRB Bearings Ltd. Experts feel that it is available
cheap at a market cap of just Rs.50 crore whereas if valued at 4x sales of nearly Rs.30 crore, the stock should trade at
Rs.135 i.e. double from current levels.
At the CMP of Rs.30, Raunaq Automotive Components is the cheapest auto-ancillary stock available. The shares
trade at a P/E of 7x and is ripe for a re-rating looking at the other overheated auto ancillary stocks in the market.
The land parcel of Garware Polyester in suburban Mumbai located close to the Western Express Highway
& international airport is up for sale. Pundits predict the land to be worth Rs.200 crore whereas its market cap
stands at Rs.330 crore. A screaming Buy!
Tamil Nadu Newsprint & Papers, Dhunseri Petrochem, Nandan Denim, have all posted excellent June quarterly
numbers. Their share prices can easily appreciate 50% in three months.
Ajanta Soya (CMP Rs.24), a leading Vanaspati & edible oil refiner in North India has a turnover Rs.550 crore with
net profit Rs.3 crore, will gear up further this year on lower commodity prices. This scrip has the potential for multibagger returns.
An Ahmedabad based analyst recommends buying Adani Transmission, Greenlam Industries, HFCL, LKP
Finance & Noida Toll Bridge Company.
BEST BET
STEL Holdings Ltd.

(BSE Code: 533316) (CMP: Rs.29.20) (FV: Rs.10)
By Bikshapathi Thota
Sentinel Tea and Exports Ltd (STEL) was incorporated as Public Ltd Company in 1991. Listed on the Bombay Stock
Exchange (BSE) and National Stock Exchange (NSE). The Company is a part of RPG Enterprise-one of the largest
business conglomerates in India. The name of the Company was changed to STEL Holdings Ltd in July 2011. The
Company currently has investments in RPG group Companies. The present quoted value of the holdings is Rs.380 crore
as follows:
The unquoted holdings of the company are:
Company
Holdings
CMP (Rs.)
Value (Rs. in crore)
1)
1,70,000 shares of Doon Doars
CEAT
1372835
1000
137
Plantations 100% subsidiary of STEL Holdings
CESC
2493470
595
149
with its registered office in Kolkata with assets in
KEC
4685800
150
71
agriculture, value of which is yet to be
determined.
RPG Life Sciences
502550
181
9
2)
10,57,135 shares of Spencer & Company
Phillips Carbon
91000
133
1
25%
stake
in Spencer International Hotels like Taj
CFL Capital
47664340
2
10
Westend, Taj Connemara, Taj Savoy valued
Summit Securities 69815
380
3
approximately at Rs.100 crore.
Total:
380
3)
30,00,000 shares of Noida Power
Company (20% stake) which operates in greater Noida. At FY14 EPS of Rs.13 will value it approximately at Rs.40
crore.
4) 375000 shares OffShore India Ltd, which holds some group company shares. Value yet to be determined.
Conclusion: If the STEL Holdings Ltd quoted holdings valued at Rs.380 crore and unquoted valued approximately at
Rs.150 crore. Discounting the unquoted securities by 30%, we get a value of Rs.100 crore and a total value Rs.480 crore.
With zero-debt on its balance sheet, each share is valued at Rs.260 (Rs.480/1.85 crore total outstanding shares).
Presently, STELs promoters are the Sanjeev Goenka group & the Harsh Goenka group. If anyone of them takes over the
company, it will trigger value unlocking. Presently, the scrip is in T2T category due to 19% promoter stake in the
physical mode. But company sources indicate that they have started to demat them where after the scrip will come out
of the T2T group. The book value of the share is Rs.65.
Generally, holding companies discount 50% discount to their fair value. In this case, even if you discount 75% of fair
value, the share should quote Rs.60+.
STOCK ANALYSIS
BSL Ltd: For slick gains

By Devdas Mogili
BSL Ltd is a 45-year old Bhilwara, Rajasthan, based company incorporated in 1970. The company has 3 plants of which
two are in Jaisalmer and one in Bhilwara, all three located in Rajasthan. Mr. Arun Churiwala is the Chairman & Managing
Director of the company.
The company manufactures polyester-viscose, polyester-woollen and 100% woollen fabrics, polyester-wool blended
and 100% woollen and worsted yarn. It markets its products under the brand BSL Suitings. It has a wide network of
area-wise agents, wholesale dealers and retailers throughout the country.
BSL is a leading manufacturer of Fashion Fabrics and Yarns in India. The Company produces a wide range of polyester
viscose fabrics and premium range of Worsted Suitings, including Cashmere, Mohair, Angora and Camelhair blends. For
the production of special furnishing fabrics, the company uses imported Silk material.
The company also installed 1920 spindles in its Worsted Spinning Division increasing its capacity to 7904 spindles. The
company has modernized under the Technology Up gradation Fund Scheme (TUFS) during 2000-2001 and replaced 16
PU-85 Sulzer weaving machines by the latest G-6300 Sulzer Rapier Weaving Machines of latest technology and
commercial production on these looms commenced w.e.f 28th September 2000. From a Finland based company it has
imported 3.10 MW Captive Power Generation Plant on furnace oil.
Exports: The company exports its products to countries like Peru and Mexico and is the recipient of the Rayon Export
Promotion Council for highest export of fabrics during 2012-13 to Focus LAC countries. The export of fabrics to Focus
LAC countries in the current year continues at an increasing trend particularly to Peru & Mexico.
In exports, the company is exploring new markets in Africa, Australia, Europe and other Latin American countries and
increasing the volumes in existing markets
Modernization & Expansion: The company installed 8 Airjet Looms during 2013 with the latest technology. These high
speed looms will boost the productivity of fabrics.
The capital expenditure plan for modernization and expansion of its Spinning, Weaving and Processing division is going
on as per schedule.
Wind Power Project: The Companys Wind Power Project is located at Jaisalmer. The newly installed 2 MW Wind
Power generator installed in FY15 is reported to be faring well.
Performance: The company recorded total income of Rs.379.88 crore with net profit of Rs.7.19 crore registering an EPS
of Rs.6.99 for the year 2014-15.
Financial Highlights:
(Rs. in lakh) Latest Results: For Q1FY16, the company posted total income of
Rs.87.49 crore with net profit of Rs.2.63 crore as against a profit
Particulars
Q1FY16
Q1FY15
FY15
Rs.0.21 crore registered in Q1FY15. The company thus posted
Total Income
8749
9200
37988
Q1FY16 EPS of Rs.2.56 as compared to an EPS of Rs. 0.20 in
Total Expenses
1510
1530
6420
Q1FY15.
Other Income
114
106
167
Financials: The company has an equity base of Rs.10.29 crore
Finance Costs
356
366
1438
with a share book value of Rs.65.28. It has a debt:equity ratio of
Total Tax Expenses
94
14
(158)
2.28 with RoCE of 9.47% and RoNW of 5.15%.
Net Profit
263
21
719
Share Profile: The companys shares with a face value of Rs.10 is
Equity (FV: Rs.10)
1029
1029
1029
listed and traded on the NSE and the BSE under the B group. Its
Reserves
5688
NSE Symbol is BSL with BSE Code as 514045 and hit a 52-week
EPS (Rs.)
2.56
0.20
6.99
high/low of Rs.62.20/24.60. At its current market price of
Rs.52.75, it has a market capitalization of just Rs.54.30 crore against total revenues of Rs.380 indicating an attractive
market cap:sales ratio.
Dividends: The company has been paying dividend as follows:
FY14-10%, FY11-15%, FY10-7.50%
Shareholding Pattern: The promoters hold 56.44% while the balance 43.56% is with non-corporate promoters,
institutions and the investing public.
Prospects: The Indian Textiles Industry has an overwhelming presence in the economic life of the country. Apart from
providing one of the basic necessities of life, the textiles industry also plays a vital role through its contribution to
industrial output, employment generation, and the export earnings of the country. The sector contributes about 14% to
industrial production; 4% to the countrys gross domestic product (GDP); 17% to export earnings. It is the second
largest provider of employment after agriculture and provides direct employment to over 35 million people. Thus, the
growth and all round development of this industry has a direct impact on the economy. India has the potential to
increase its textile and apparel share in the world trade from the current level of 4.5% to 8% and reach US $ 80 billion
by 2020. The most significant change in the Indian textile industry has been the advent of man-made fibres (MMFs).
India has successfully placed its innovative range of MMF textiles in almost all the countries across the globe.
The potential size of the Indian textile industry is expected to reach US$220 billion by 2020. A strong raw material
production base, a vast pool of skilled and unskilled personnel, cheap labour, good export potential and low import
content are some of the salient features of the Indian textile industry. The company expects huge growth in demand for
its products in coming years owing to the total Indian urban population, which currently stands at 307 million and
provides huge growth opportunities. The Company forecasts good market demand for its products, which is expected to
improve margins substantially.
The outlook for the textile industry is very optimistic. It is expected that Indian textile industry would continue to grow
at an impressive rate. Assuming that inflation is brought under control and input prices revert to a more moderate level,
the domestic market is expected to continue to deliver healthy growth. The raw material prices are expected to stabilize
and the demand growth is likely to push up due to the overall economic recovery. The government is also very
optimistic of the textile trade and with the pro-active government policies, the Indian textile industry can command a
dominant share in the world trade after China. The
For the busy investor
company is also taking a long-term view of the
industry and hopes to boost turnover and margins
Fresh One Buy Daily
from the current level. Simultaneously, the company
Fresh One Buy Daily is for investors/traders who are keen to
is strengthening the quality of its products and reduce
focus and gain from a single stock every trading day.
the conversion cost. These initiatives are expected to
With just one daily recommendation selected from stocks in
positively influence the working of the company.
an
uptrend, you can now book profit the same day or carry
In addition, the company is focusing on Retail markets
over
the trade if the target is not met. Our review over the
and RMG/Institutional segment. The company is also
next
4
days will provide new exit levels while the stock is still in
exploring new markets for sale of worsted yarn.
an uptrend.
Conclusion: BSL is an existing, profit making and
This low risk, high return product is available for online
dividend paying company with good export presence,
subscription at Rs.2500 per month.
brand image and impressive track record.
Contact us on 022-22616970 or email us at
At its current market price of Rs.52.75, the share price
[email protected]
for a free trial
discounts less than 7.5 times its 2014-15 EPS of
Rs.6.99 which is also the industry average P/E ratio.
However, the future earnings of the company have not been factored into its current market price. As such, considering
its impressive performance, good brand image, strong export presence, modernization and expansion plans, attractive
market cap:sales ratio and bright prospects going ahead, the share is currently available at attractive valuations. The
peer group companies like Vardhaman Textiles, KPR Mills, Welspun India are quoting at much higher valuations. The
share may be bought for reaping slick gains in the medium-to-long-term. Above all, the share price is quoting much
below its book value indicating good margin of safety even for risk averse investors.
GURU SPEAK
Market is bullish
To read the market accurately is an art based on experience and deep rooted knowledge. While in the stock market vast
many investors are carried away by vested basis of calls and advisories that are quite popular but disappear like the flyby-night promoters of earlier years. Hence its important to distinguish between popular lore and true merit that is tried
and tested like Money Times for 25 years.
Last week, I had strongly hinted about a breakout that looked almost certain in the coming trading
week
ending
Panchratna 6th Edition
Friday, 8
Great Dhamaka this time.
August
2015 and
Five Gems from five sectors of Power/Real Estate/Construction &
gave the
Engineering/Pipes & Tubes/Iron Ore
reasons
All Stocks are highly liquid
for it.
All the five stocks have been beaten down heavily and bottomed out
The BSE
Enough Potential for growth
By G. S. Roongta
Sensex,
which
Do not miss this issue!
was mostly flat to close at
Have a look at the annual performance given below.
2814.56 on Friday, 31 July
Issue
Date
Scrip Name
Recom.
High
2015, made good headway
No.
Rate (Rs) achieved (Rs)
almost throughout last week
1
April 2014 Cheslind Textiles Ltd.
4.98
12.10
except on the monetary
Katare Spinning Mills Ltd.
19.50
31.80
policy review on Tuesday, 4
Trident Ltd.
18.80
29
August 2015.
Elecon Engineering Ltd.
36.75
81
The RBI governor, Mr.
Essar Ports Ltd.
50.90
150.40
2
July 2014
Hind Syntex Ltd.
14.01
16.30
Raghuram Rajan, is basically
Suryaamba
Spinning
Mills
Ltd.
31.20
50.40
a
conservative
focused
Standard
Industries
Ltd.
20
25.50
always on the fears of a rise
Sarda Plywood & Industries Ltd.
18.85
51.55
in
the
inflation
rate
Dish TV India Ltd.
62.95
117.25
reviewed the monetary
3
Oct. 2014 Ashok Leyland Ltd.
41.10
77
policy keeping all interest
Mangalore Refinery &
61.45
77.80
rates unchanged despite the
Petrochem.
monsoon having behaved
National Steels & Agro Ltd.
20.30
20.40
better-than-expected by him
Landmark Property Development
5.24
5.75
PVP Ventures Ltd.
8.32
8.59
in his last policy review. Yet
4
Jan. 2015
Stock A
35.50
39.75
he feared that consumer
Stock B
94.30
138.50
inflation would rise as the
Stock C
9.95
13.85
success of the monsoon may
Stock D
25.10
31.35
not last long.
Stock E
14.70
29.45
Conservative and pessimistic
5
Apr. 2015 Stock A
88.05
124.70
Stock B
68.35
78.95
nature is an inborn quality in
Stock C
56.30
71.80
some persons who cannot
Stock
D
46.15
59.65
hope for good till it
Stock
E
54.30
65.65
materializes and as such lack
the gift of vision. A visionary
person is one who can bet on
In the current bull run, Panchratna stocks are a sure way to reap rich rewards.
the futures based on
The next issue of Panchratna was released on 1st July 2015.
available data but Mr. Rajan
Subscription Rate: Rs.2500 per quarter, Rs.4000 for two quarters & Rs.7000 per
does not like to bet and
annum.
prefers to leave growth
You can contact us on 022-22616970,22654805 or [email protected]
behind while combating
inflation.
This is why the RBI, which enjoyed absolute liberty in deciding monetary policy, has come under a cloud and will be
joined by three government nominees on board to decide upon this important policy. The RBI governor will enjoy the
second casting vote in the event of a tie.
According to me, there was no reason to keep policy rate unchanged because of the hypothetical fear or uncertainty on
monsoon progress. Yet his bugbear of inflation ruled out a soft policy. His hawkish in policy decision was in line with
street expectations.
That is why the market sentiment was not impacted much like the last policy review in June 2015 when the Sensex
tumbled by over 2000 points when RBI governor feared a weak monsoon below normal that could result in crop failure
and unexpected rise in food prices.
He proved wrong in his past prediction and will again go wrong in his fear of a rise in inflation and food cost.
In the view of this, the governments efforts to bring growth forward remained suppressed factory production could not
make much headway despite the fall in cost of production. Capacity utilization remained sluggish due to unavailability of
funds and higher financial cost.
Lower crude oil prices could not spur growth except check import growth.
On the one hand, Mr. Rajan wants bank inflation to lower the interest rate but on the other hand, he remains hawkish. So
industry is unnecessarily sandwiched in between.
Despite no favorable development on monetary policy review, the market kept its positive tempo to rise from the first
day of the week under review.
The stock market rallied upward on 3 August 2015 with BSE Sensex rising 72-50 to close higher at 28187 following by
CNX Nifty at 8543.
The fear of CNX Nifty to fall below 8200 by technical analysts was ruled out because it seemed headed towards 8700 no
sooner some positive trigger emerges in the near future.
Several stocks from the Banking sector were fancied including Maruti Suzuki to rule at a life time high of Rs.4427 on 3
August 2015.
KPIT, Sun TV, which was dumped earlier, started to flare up 11% from Rs.336 to Rs.374, which came out with weak
numbers was also in the limelight while MRF did wonders to hit not only lifetime high but the highest valuation of Rs.
45000. Perhaps, the highest among all listed companies.
Mid-cap and small-cap stocks were faring well with almost dozens of them hitting the 20% upper circuits on a regular
basis each day.
Thirumalai Chemicals rose 20% at Rs.240, SPL Industries at Rs.15. The stock market on the day of the monetary policy
review on 4th August was not at all shaky despite no change in interest rate. Psychological impact was of course, noticed
at the fag end of the market session due to profit booking and bears keeping in mind the previous time made short-sells
to maintain the upper hand, which made the Sensex lose by 115 points as 28071 and CNX Nifty down by 26 points to
8516 to salute the RBI governor!
The market had however regained lost ground the next day, Wednesday, 5 August 2015, by gaining more than what it
lost on monetary policy day. The BSE Sensex rallied by 151.15 points to close at 2822.3 followed by CNX Nifty rose by 51
points at 8567.95. It may be noted that this was despite no positive development either at the economic or political
fronts. Parliament was yet disrupted again and there was no sign of improvement.
This is utter failure on Mr. Modis part who could not take any opposition party in confidence. This is utter lack of
maintaining good relationship with any party in the entire Opposition. None of them have supported him in his mission.
He must have succeeded in cultivating leaders overseas but it makes no sense if domestic relations are at stake.
The market continued to rule high again on Wednesday, 6 August 2015, rising 75 points and expected to close higher
once again on Thursday to give higher positive closing on a weekly basis.
The sectoral indices were in good form. Banking sector breathed a sigh of relief as the next policy review is expected to
be positive. Commodity sector shows some signs of positive turnaround with the government assurance of raising
import duty to rise by 2.5% so that domestic industry may reap a rich harvest against cheap imports so far.
Tata Steel, SAIL, Jindal Steel all spurted between 5 to 7% in the last 2/3 days and were expected to rise further.
Aluminium and copper, too, made a headway with Hindalco at its lifetime low at Rs.104 rose to Rs.110 on expectation of
good days ahead.
Cement stocks which faced resistance on account of poor offtake is reported to have benefitted by higher capacity
utilization and soaring cement prices after the Monsoon session.
10
Power & Infrastructure followed by Technology stocks have also geared up. Thus good market sentiment are likely to
emerge in days to come.
Panchratna subscribers are a happy lot as all stocks recommended right from the 1st edition to 6th edition have
skyrocketed. They must feel happy that one who subscribed for the full year by paying Rs.7000 has reaped good harvest
to earn or book profits by 10 times or more.
This may sound incredible as no fund house with its mind-boggling charges could not deliver such fancy returns if the
following table is any fair indication.
The
YoY
No.
Gain
gains
are
mind1
Trident recommended at Rs.18.80 in first edition shot up to Rs.50 on 5th August.
200%
boggling
2
Elecon Eng. made a new high at Rs.96/80 recommended at Rs.36.75.
170%
and
no fund
3
Essar Ports recommended at Rs.51 made a high of Rs.150.
200%
house
or
4
Sarda Ply wood recommended in July edition at Rs.18.85 has skyrocketed to Rs.66.
300%
technical
5
Dish T.V recommended in July edition at Rs.62 spurted to Rs.124.
100%
experts has
6
Ashok Leyland recommended at Rs.41 in October edition skyrocketed to Rs.90.
140%
provided
7
Stocks recommended in January 2015 and April 2015 have all risen substantially hitting highs
such hefty
between 100% to 150% in a short span of time of 3 to 6 months. We cannot disclose the
returns.
names as subscribers have yet the choice to subscribe.
The
publisher was thus right while advertising the 6th edition of Panchratna as Big Dhamaka providing mind boggling gains
because it has proved to be that. Those who subscribed have reaped a good harvest while those who missed can only
repent.
Week before last we carried a story on Mafatlal at Rs.226 which has shot up Rs.300 i.e. nearly 50% in two weeks! This is
how Money Times make good quality recommendations week after week to benefit small investors. Due to paucity of
space, we cannot carry a detailed story on MRPL, which will now be featured in the next issue.
STOCK WATCH
By Amit Kumar Gupta
UPL Ltd.
(BSE Code: 512070) (CMP: Rs.544.10) (FV: Rs.2) (TGT: Rs.600)
UPL Ltd is a generic agrochemical company engaged in manufacturing and marketing crop protection chemicals. It also
offers crop protection solutions and manufactures crop protection chemicals and industrial chemicals at 28
manufacturing locations across the world. It offers a product portfolio of crop protection chemicals, including fungicides,
herbicides, insecticides, plant growth regulators, rodenticides, speciality chemicals, nutrifeeds and seeds. The Company
operates through two business segments: Agro activity and Non-agro activity. The Agro activity segment includes the
manufacture and marketing of conventional agrochemical products, seeds and other agricultural related products. The
Non-agro activity segment includes manufacture and marketing of industrial chemicals and other non-agricultural
related products. It operates through 76 global subsidiaries in the agrochemical space.
The rising demand of foodgrains and declining size of farmlands in India has increased the scope for agrochemicals &
pesticides. The Indian crop protection market was estimated at $ 3.8 billion in FY12 with exports constituting about
50% of the market. The crop protection market has experienced strong growth in the past and is expected to grow
further at around 12% p.a. to reach $ 6.8 billion by FY17.
UPL is a direct play on Indian agriculture as the demand for food crops increases with rising commodity prices &
high population growth. To expand and grow, UPL has historically focused on acquisition of smaller companies and
brands to outperform its peers.
New launches of 69 Actives/Technical; 151 Formulations and Total Country Launches/Registrations of 567
(addressable Market size of USD 5 billion) are expected to boost the top-line over the next two years.
As per the management, the company has 14% market share in India and the target is to increase this to 25% over
the next 5 years. As a strategy towards this end, UPL has identified 100 hot spots in India essentially in 50-100 sq.
km areas which are high potential markets. UPL plans to aggressively place its products depending on the cropping
pattern and other factors in these areas.
11
Brazilian business (DVA Agro) has achieved breakeven status and the company expects the profitability to sharply
improve over the next 3 years
UPL's low-cost manufacturing base in India and its strong global distribution network are its key advantages and
provide it with considerable operational flexibility and efficiency over its competitors. We recommend a Buy on the
stock with a price target of Rs.625.
Technical Outlook: The UPL Ltd stock looks good on the daily chart for medium-term investment pick. The stock is
consolidating a breakout, which changes in an upward move. The stock on the short-term daily chart has formed a
strong upward move and shows some strength for making higher highs. The stock is also trading at important support
moving averages like 200 DMA.
Start accumulating at this level of Rs.544.10 and on dips to Rs.504.10 for medium-to-long-term investment and possible
price target of Rs.600+ in the next 6 months.
***********
Bank of Baroda.
(BSE Code: 532134) (CMP: Rs.185.10) (FV: Rs.2) (TGT: Rs.220)
Bank of Baroda (BoB) is a public sector bank that offers various deposit plans. The Bank operates its business in four
segments: Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations. The Banks deposit
plans offer other features such as overdraft facility, outstation cheque collections, safe deposit lockers and ATMs. The
Bank offers deposit products and services in various categories such as fixed, current, savings and Baroda first wealth
pack. The Bank also offers a wide range of products and services including wholesale banking, rural/agri banking,
wealth management, CPPC pension, government business, pre-paid cards, interest rates, deposit products, loan
products, internet banking, mobile banking, automated teller machine (ATM) / debit cards, demat and NRI Tax Solution.
Bank of Baroda (BoB) delivered better-than-expected numbers for Q1FY16 (PAT of Rs.1,052 crore) led by lower
provisions (up 14% YoY but down 67% QoQ). The operating profit was down by 11% YoY due to slower growth in NII
(up 4% YoY) and 22% Y-o-Y increase in the employee expenses (Rs.262 crore provision on AS15 and wage revision).
The NIM rose 9 bps QoQ to 2.26% largely due to the increase in yields.
While the reported NPAs inched up on a Q-o-Q basis, the total stressed loan (restructured loan + slippages) was
relatively lower (Rs.2,055 crore vs Rs.5,443 crore in Q4FY15 and Rs.2,870 in Q1FY15). The banks provisions grew 14%
largely due to a low base (write-back of investment provision of Rs.319 crore in Q1FY15). The provision coverage ratio
was steady at ~65%, which is better than peer
banks.
Valuation: BoB has shown recovery in margins
and stabilization in asset quality, which is a
Can you spot a winner?
positive. While the NPA concerns remain in
Are you keen to write?
general, we expect BoB to be relatively better as
compared to peer banks. A better provision
If your answer is YES to all the three questions, MONEY
coverage and relatively higher Tier-1 CAR (9.41%)
TIMES, launched by the pioneers of investment
add to the comfort. We have fine-tuned our
journalism,
invites you to join its team of contributors.
estimates to factors like better-than-expected
profits. We have a Buy with a stop target Rs.220.
Each and every analyst on our panel is passionate
about stock investments and is an expert in his field.
Technical Outlook: The Bank Of Baroda stock
looks very good on the daily chart, for mediumWhat is, however, more significant is that most of them
term investment. The stock is consolidating
were our subscribers first and have been writing for
breakout which changes in an upward move. The
over 20 years now.
stock on the short-term daily chart has formed a
So if you want to join this eminent group, write to
strong upward move and shows some strength for
[email protected]
and send us a sample
making higher highs. The stock is also trading
at important support moving averages like 200
of your article written or published.
DMA.
Start accumulating at this level of Rs.185.10 and on dips to Rs.164 for medium-to-long-term investment and possible
price target of Rs.220+ in the next 6 months.
Are you passionate about stocks?
12
MARKET REVIEW
Bourses register modest gains

By Devendra A Singh
The BSE Sensex (30-share index) settled flat at 28,236.39 gaining 121.83 points and the NSE Nifty closed at 8,564.60 up
31.75 points last week ending Friday, 7 August 2015. The bourses rose in 3 of the 5 trading sessions of the week.
Equity markets logged marginal gains last week on positive market sentiment. The Reserve Bank of India (RBI) in its
third bi-monthly policy review has kept the key rates unchanged on Tuesday, 4 August 2015. The key repo rate stands
unchanged at 7.25%.
The RBI kept the key rates unchanged although the overall business confidence is positive the level of optimism was
shade lower in April-June 2015 than in the preceding quarter. Investments as measured by new projects are still weak
primarily because of persistently low capacity
utilization.
Free 2-day trial of
RBI Governor, Raghuram Rajan, said in the policy
Live Market Intra-day Calls
statement that, In India the economic recovery is
still work in progress. The outlook for growth is
A running commentary of intra-day trading
improving gradually. On an assessment of the
recommendations with buy/sell levels, targets, stop loss
evolving balance of risks, the projected output
on your mobile every trading
growth for the FY15-16 has been retained at
day of the moth along with pre-market notes via email for
7.6%.
Rs.4000 per month.
Nominal bank credit growth is lower than the
Contact Money Times on 022-22616970 or
previous years but adjusted for lower inflation as
[email protected] to register for a free trial
well as for lower borrowing by oil marketing
companies and increased borrowing from
commercial paper markets, credit availability seems to be adequate for most sectors, the statement added.
Turning to the balance of inflation risks, the RBI said that most worrisome is the sustained hardening of inflation
excluding food and fuel. Some food prices, particularly protein-rich items like pulses and oilseeds have risen sharply.
On the monsoon front, India Meteorological Department (IMD) has retained its forecast for this years monsoon rains at
88% of the long-period average as a strengthening El Nino weather pattern is likely to trim rainfall in August-September
2015 to 84% raising fears of the first drought in six years. Rainfall of less than 90% is considered to result in a drought
year although the latest prediction has an error margin of 4% points.
The monsoon rains, which make up around 70% of Indias annual rainfall, are crucial to the nations agriculture sector
and broader economy which accounts for 14% of the $2 trillion economy. In a country where nearly half of farmland
lacks irrigation, poor rainfall in the second half of the June-September 2015 monsoon season may surge food inflation. In
some areas of India, rainfall deficit is as high as 57%, IMD data showed.
Monsoon rains covered the entire country ahead of schedule this year accelerating the sowing of summer-sown crops.
But a prolonged dry spell in some regions has threatened to wilt planted crops.
Now farmers are completely dependent on the September 2015 rainfall for the cultivation of winter crops. On the other
side, poor rainfall in September can hit sowing of winter crops and will lead to higher food prices.
It would be the biggest anomaly since 1997 surpassing the top recordings associated with the El Ninos of year 2002 and
2009.
On the global data, global factory activity remained muted in July 2015 and with new orders barely accelerating there is
unlikely to be much improvement this month, a business survey showed.
The global PMI combines survey data from countries including the United States, Japan, Germany, France, Britain, China
and Russia.
Key indices ended higher on Monday, 3 August 2015 on positive market sentiment. The BSE Sensex surged 72.50 points
(+0.26%) to close at 28,187.06. The NSE Nifty was up 10.20 points (+0.12%) to close at 8,543.05.
Key indices moved lower on Tuesday, 4 August 2015 on selling by foreign funds. The BSE Sensex dipped 115.13 points (0.41%) to close at 28,071.93. The NSE Nifty was down 26.15 points (-0.31%) to close at 8,516.90.
Key indices gained on Wednesday, 5 August 2015 on equity buying. The BSE Sensex climbed 151.15 points (+0.54%) to
close at 28,223.08. The NSE Nifty was up 51.05 points (+0.60%) to close at 8,567.95.
13
Key indices moved up on Thursday, 6 August 2015 on buying by foreign funds. The BSE Sensex jumped 75.05 points
(+0.27%) to close at 28,298.13. The NSE Nifty was up 20.70 points (+0.24%) to close at 8,588.65.
Market performance settled lower on Friday, 7 August 2015 on minor correction. The BSE Sensex fell 61.74 points (0.22%) to close at 28,236.39. The NSE Nifty was down 24.05 points (-0.28%) to close at 8,564.60.
For future events, corporate earnings, August & September monsoon, macro figures will play a crucial role for Indias
economy. Also, investors will keep a close track on the US Fed interest rate hike decision if the US economy grows better
and unemployment falls and the global macro-economic data especially China and Greece will keep dictating market
movements.
Indian currency which sails in panic and has breached 64-mark against the US Dollar is hovering near 64.50/USD made
foreign funds to keep a close watch on the performance of INR as against other currencies.
Market participants will keep watching Chinas market trend, which is another crucial factor that will decide the global
market movements in near-term as China equity markets is in declining trend.
PRESS RELEASE
Power Mech Projects Ltd IPO opens on 7th August 2015

Power Mech Projects Ltd enter the capital market with an IPO of 4,269,000 equity shares of Rs.10 each in the price band
of Rs.615 to Rs.640 per equity share. The bid/issue opens on Friday, 7 August 2015 and closes on Tuesday, 11 August
2015.
Power Mech Projects Ltd is engaged in the business of i) Erection Work that includes erection, testing and
commissioning of boilers, turbines and generators (ETC-BTG) and balance of plant (BOP) for power sector; ii) Operation
& maintenance (O&M) that includes annual maintenance contracts, other repairs, renovation & modernization, residual
life assessment, scheduled shutdowns, retro fits, as well as overhauling, maintenance and upgradation services for
power plants and iii) Civil works that includes various civil and construction jobs for the main plant and BOP
requirements including excavation, piling, concreting, architectural and building works.
The Issue comprises a fresh issue of 2,128,000 equity shares and an Offer for Sale of up to 2,141,000 equity shares by
India Business Excellence Fund I, India Business Excellence Fund represented by its trustee IL&FS Trust Company Ltd,
P.Srinivasa Rao, and D.Aakashnag, a minor represented by his guardian D.S.Rao. The Issue will constitute 29.02% of the
fully diluted post issue paid-up equity share capital of the company.
The minimum Bid lot is 20 equity/shares and in multiples of 20 equity shares thereafter. The Issue will be through the
book building process and will be listed on the BSE and NSE.
The Company proposes to use the IPO proceeds for funding working capital requirements of the company and general
corporate purposes.
14
EXPERT EYE
By Vihari
Sanwaria Agro
Medium-term
proposition
Oils:
9th edition of Beat the Street 9

released on 8th June 2015
th
On 4 March 2015, the CNX Nifty kissed an all-time high of 9119 and the BSE
th
Sensex had crossed the 30,000 level almost coinciding with the 8 edition of
Beat the Street 9 released on 9 March 2015.
(BSE Code: 519260) (CMP: Rs.7.87) (FV:

Re.1)
From these all-time high levels, we have seen a strong & healthy correction
The share of Sanwaria Agro Oils Ltd (SAOL)
as most stocks have corrected 20-40% from their highs. But still in this
can be bought for decent gains in the
market,
Beat the Street 9 stocks have performed well as shown below.
medium-term as the company is reportedly
th
doing well in the current year and likely to
Now the 9 edition of Beat the Street 9 has already been released on
th
post an EPS of Rs.1.2 in FY17. Relatively
Wednesday, 10 June 2015. So if you want to get multi-bagger ideas like our
little-known SAOL has expanded into a
past eight editions, then dont waste any time and subscribe to this
business with revenues of Rs.2,600 crore in
newsletter today!
just a little over two decades with twoBeat the Street 9 Review
thirds of its revenue coming from
th
6 Edition dated 1st September 2014
processing soybean into oil, soymeal and
de-oiled cakes. What started as a company
Stocks
Recom. at (Rs.)
High (Rs.)
Gain %
with the capacity to crush 200 TPD of
Bharti Airtel
370
426
15.13
soybeans can now handle 3,250 TPD.
TATA Chemicals
385
482
25.19
SAOL was established in the 1991 and is
OIL India
615
669
8.78
the largest FMCG in India. It operates from
ICICI Bank
1545 (ABP)
1965
27.18
Bhopal in Madhya Pradesh (M.P.) and its
Godavari Power
155
186
20
factories are set up in Mandideep, Itarsi,
JBF Industries
135
297
120
Harda all in M.P. and a branch office was
TV Today
200
262
31
set up in Maharashtra. It is primarily
Sonata Software
107
182
70.09
engaged in the production of Edible Oil,
Mahindra Life
530 (ABP)
580
9.43
Crude Oil, and Refined Oil of Soy Bean. It
also manufactures other food products
7th Edition dated 1st December 2014
under the Sanwaria brand name Rice,
Stocks
Recom. at (Rs.)
High (Rs.)
Gain %
Rawa, Maida, Salt, Soya Chunk (Bari),
Reliance Capital
497.5 (ABP)
Stop Loss
-----Fortified Soya Oil, High Protein Soya Meal,
PTC India
87 (ABP)
102
17.24
Full Fatted and Defatted Soya Flour etc.
Jindal Saw
101 (ABP)
Stop Loss
---SAOL is granted the Star Export House
status by the Joint Director General of
Karnataka Bank
140
156.5
11.78
Foreign Trade, Bhopal.
Indoco Remedies
281.5 (ABP)
401
42.45
KPIT Techno
169
233
37.86
SAOL is headed by Anil Agarwal. The family
J M Fin
49
58.8
20
has been in the commodity trading and
Menon
Bearing
140
238
70
milling of pulses since the 1950s. Its first
Panasonic
Energy
315
379
20.31
unit at Itarsi in Madhya Pradesh went
operational in 1993 and was followed by
Subscription Rate: 1 Quarter: Rs.3500, 2 Quarters: Rs.6500, 3 Quarters:
an IPO to fund its expansion. Since then,
Rs.9000, 1 Year: Rs.11000
Sanwaria Agro has grown on the back of a
series of acquisitions of sick or closed
Contact Money Times on 022-22616970 or [email protected]
units, which it has turned around
successfully. SAOL has presence in Madhya
Pradesh, Chhattisgarh, Uttar Pradesh, Maharashtra, Haryana, Delhi, Himachal Pradesh, Punjab, Uttarakhand and West
Bengal.
SAOL has ventured in modern trade also for its brand building like tie-up arrangements with various shopping
malls/chains. It has tie-ups with Vishal Retail, Reliance Fresh, Pantaloon (Big Bazar) and ITC Choupals for tapping their
15
retail outlets to sell its branded products. SAOL has expansion plans of Rs.400 crore to be funded through the
QIP/Private placement route.
SAOL sells its full range of edible oils under the brand names of 'Sulabh', 'Narmada' & Sanwaria to attract different
segments of consumers. Sanwaria and Narmada brands of Refined Soyabean Oil are produced from selected Soyabeans
of M.P. in Sanwaria's state-of-the-art solvent extraction plant & refinery. It keeps the heart healthy since it has very low
cholesterol. It also contains high omega3 & Vitamin E proven antioxidants and also improves brain activity and skin
tone. It has a high smoke point which reduces its consumption. It is an ideal cooking medium to keep the family Healthy
& Fit.
In FY14, SAOL launched Basmati Rice, Rawa, Maida, Sooji, Daliya and Besan under the brand named Sanwaria, Soya
nuggets/chunks under Sanwaria Pro diet. The commercial production of new products like Mustard oil, pulses and
spices in consumer packs is expected to be produced in the new season during this year. Some value added Soya based
products Like Soya Flour, Soya Tofu and Potato based products like Chips, Flakes, and Vanaspati, Ghee and a Vegetable
oil refinery are in the pipeline.
Lecithin is used as an emulsifier to increase the life of products, reduce fat content and enhance spreadibility of the
product. Lecithin is a mixture of polar and neutral lipids and phospholipids. Polar lipid consists of glycolipids, neutral
lipids are triglycerides and phospholipids contain phosphates. This is in liquid form.
Since soya bean meal is mainly used as cattle feed, SAOL exports Soya Deoiled cakes.
In Q4FY15, SAOLs net profit was flat at Rs.6.6 crore on 42% lower income of Rs.494 crore and the Q4FY15 EPS was
Rs.0.2. Its equity capital is Rs.34.8 crore with reserves of Rs.228 crore, the book value of its share works out to Rs.7.5.
During FY15, net profit rose 3.7% to Rs.25 crore on 7.7% higher sales of Rs.2662.5 crore and the FY15 EPS is Rs.0.7. The
promoters hold 70% in its equity capital, PCBs hold 20.2% leaving 9.7% with the investing public.
The most popular and largest produced oilseed in the world is soybean. It is supported by a wide variety of climates and
soils and that is why it is considered to be the most economical crop and has a good worth. Before the 2nd World War,
soybean was not considered an important crop and was thus not used on a large scale. But after the war, it rose to
become one of the most important crops in the world.
Soybean production constitutes around 55% of the total world production of oilseeds of around 170-185 million tonnes.
The production of soybean has increased by about 5.6% over the last 10 years. Around 30% of the worlds total produce
is traded annually. USA is the leading producer of soybeans followed by Brazil and Argentina. The leading importing
countries of soya oil are China with an import of about 2.5 million tonnes and India with 2 million tonnes of imports.
The consumption of soya refined oil has increased and the demand of soya meal is growing fast as about 98% of
soyameal is used as an animal feed ingredient with the remainder used in human foods such as bakery ingredients and
meat substitutes. India is primarily a closed economy in the soyabean arena. India exports every year, around 4 to 5
million metric tonnes deoiled cake (DOC) and earns foreign exchange of $1.7-$2.4 billion.
India is the worlds third largest edible oil economy after China and USA. The total Indian consumption is around 1212.2 million tonnes vis--vis Chinas 14.5-15 million tonnes. However, the per capita consumption of edible oils in India
is likely to climb to 14.25 kg from the current level of around 12.14 kg.
SAOL has followed a Brownfield expansion route with the acquisition of sick units. It is still looking for acquisition
opportunities where it can create value. It wants to acquire edible oil and wheat flour brands. With a planned investment
going forward, SAOL is eyeing a top-line of Rs.5,000 crore.
On the demand side, a growing population and vastly varied dietary habits have ensured a thriving market for edible oils
in the country. Indias annual consumption is around 12 million tonnes, which is met by imports and domestic
production in the ratio of 60:40.
Keeping in view the domestic seed growth and expansion plans, SAOL has undertaken steps to establish its dominant
presence in basic edible oil and soya business and also seize business opportunities that arise on account of our
leadership position in the industry.
SAOL is all set to post an EPS of Rs.1.2 in FY16, which could further rise to Rs.1.6 in FY17. At the current market price of
Rs.7.87, the share trades at a forward P/E of 6.5 on FY16E and 4.9 times FY17E. A reasonable P/E multiple of 8.5 will
take its share price to Rs.14 on FY17E, which would fetch a decent-gain of 75% in the medium-to-long-term. The 52week high/low of the share has been Rs.11.38/5.
**********
16
MRF: Low equity, high earnings; undervalued on an expansion

drive
MRF Ltd has posted mind blowing quarterly results for the quarter ended 30 June 2015 and has changed the year-end to
March from September. Hence the next fiscal results will be for 18 months ending 31 March 2016. The share was earlier
recommended at Rs.36870 in April 2015 issue.
Based on its Q1FY16 results, MRF is all set to post an annualized EPS of about Rs.3700 in FY16 on its tiny equity capital
of Rs.4.2 crore. A reasonable P/E multiple of 16x, as applicable to blue chip companies, will take its share price to
Rs.59200 with a likely gain of over 60% in the medium-term and Rs.72,000 in the long-term. Investors also await a
liberal bonus in the current fiscal. The last bonus was 1:2 in 1975.
Madras Rubber Factory (MRF) was initially set up as a toy balloon manufacturing unit in 1946 by Mr. KM Mammen
Mappillai. In 1952, the company forayed into tread rubber manufacturing and today it is the largest tyre manufacturer in
the country with 8 plants set up across India to cater to the entire spectrum of tyres from passenger vehicles (PVs),
commercial vehicles (CVs) to industrial tyres.
MRF has the most diversified portfolio in the industry and commands leadership position in various segments, including
2-wheelers, PVs and Truck/Bus Bias tyres. Its manufacturing facilities are located at Tiruvottiyur and Arakonam in
Tamil Nadu, Kottayam in Kerala, Ponda in Goa, Medak in Andhra Pradesh and Union Territory of Pondicherry. A
greenfield unit at Tiruchirappalli commenced operation in the 2012-13. The companys products cater to almost all
segments of the automobile industry.
MRF is also the first Indian company to venture into the Defence space in 2008, being the sole supplier of tyres to the
Indian Air Force (IAF) and Hindustan Aeronautics Ltd. (HAL) for the Chetak helicopter.
MRF has a strong presence in the replacement market with the widest dealer network in the country totalling 4500
dealers and 300 exclusive T&S centers. It also has a high brand recall among OEMs as indicated by the Original
Equipment Tyre Customer Satisfaction Index (TCSI) Study, which MRF has won a record 10 times in 13 years and the
only Indian tyre manufacturer to do so.
MRF is present across all categories of tyres and is a market leader in the tyre industry with about 29% market share. It
is also a leader in the passenger car tyre segment with a 25% market share and holds a third position in the medium to
heavy commercial vehicle (MHCV) segment with 24% market share. MRF also exports tyres to over 80 countries in
America, Europe, Middle East, Japan and the Pacific region.
For Q1FY16, its net profit zoomed 94% to Rs.447 crore on 6% higher sales of Rs.3539 crore. During the previous quarter
ended 31 March 2015, MRF (Year end-September) had posted 94% higher net profit of Rs.332.6 crore on 4% higher
sales of Rs.3312 crore Q1FY16 EPS is Rs.1058. The raw material cost benefit continued this quarter as well. Aided by
lower raw material costs, the EBITDA margin witnessed a substantial jump.
For SY14 (September-end), net profit rose 12% to Rs.898 crore on 9% higher sales of Rs.13190 crore and the EPS stood
at Rs.2118 and a dividend of 500% was paid.
MRFs equity capital is Rs.4.24 crore and with reserves of Rs.4535 crore, the book value of its share works out to
Rs.10705. The value of its gross block including capital-work-in-progress of Rs.627 crore works out to Rs.6968 crore.
Investments, cash and loans given etc stood at Rs.1974 crore (Rs.4655/share). The promoters hold 27.3% in the equity
capital, PCBs hold 26.3%, Foreign holding is 9.5% and with DIs holding 9.1% leaves 27.8% with the investing public.
MRF is expanding its manufacturing facility at Sadasivpet in Medak district of Telangana at an additional investment of
Rs.980 crore. This unit has been in operation since 1990 and about Rs.4,300 crore has so far been invested in it. Its
Tiruchi factory is expected to receive a significant portion of the capex. It accounts for about 25% of the companys
overall production capacity, which is estimated at 15,000 TPD or about 1.2 lakh tyres a day.
MRF has embarked on a 3-year expansion programme at an investment of Rs.4,000 crore to ramp up capacities across
its factories. This is the second major investment plan announced by this Chennai-headquartered tyre maker in the last
four years. In 2010-12, it took up a Rs.3,000 crore capacity expansion, which included establishing a new factory near
Tiruchi. The aforesaid investment of Rs.980 crore is a part of this massive investment of Rs.4,000 crore.
The Indian automobile market will definitely see strong growth. Even at 6-6.5%+ GDP growth, it is worth investing on
capacity expansion as the demand for automobiles will remain robust in India.
The proposed investment would result in additional revenue of Rs.4,500 crore for MRF in the mid-term as the
asset:investment ratio in the capital-intensive tyre industry is 1:1.1. A stronger focus on the replacement market and a
17
better product-mix besides lower rubber prices helped the company sustain margins. MRF secures 70-75% revenue
from the replacement market.
Indias large market has immense potential for growth with an expected Industry turnover of about Rs.50,000 crore. In
terms of the segment mix, the Replacement market contributes around 67%, OEM accounted for 22% and exports were
11%. In the tyre segments, Truck & Bus tyres commanded 50% of the industry turnover.
Notwithstanding the current slowdown in the auto industry, the medium-to-long-term prospects are promising. It is
expected that commercial and passenger vehicle industry will grow at 7-8% and 11- 12% respectively in the next 4-5
years time.
Industry analysts expect both the OEM and the replacement demand to rise in unison. Following flattish to negative
growth during 2013-15, we expect the domestic tyre demand through 2015-17 to grow at 13-15% driven by strong
replacement growth and OEM demand. M&H CVs, two-wheelers and passenger vehicles are likely to support this
growth.
Truck/Bus Radials will continue to grow due to the new generation vehicles being fitted with Radials and the expected
boost to investment in overall infrastructure growth. These factors will lead to higher radialisation in the commercial
segment at a faster pace.
Techno Funda Plus
The initiatives taken by the government to
accelerate economic activity with special focus on
2/3rd stocks yield 20%+ returns in just 1 month
the manufacturing sector are further expected to
Blockbuster returns from Beat the Street 9
improve the tyre demand across segments. Greater
emphasis on the infrastructure sector, including
On 8th June 2015, we had published the 9th Edition of our Beat
road and mining sector, will give a boost to
the Street 9 newsletter. Within just one month all 9 stocks have
economic recovery.
yielded returns. Out of 9, 6 stocks have given handsome returns.
Rubber constitutes 70% of the raw material costs of
KEI Industries recommended @ Rs.63 zoomed to Rs.91.4 level
a typical tyre company. The global outlook and soft
recording 45% appreciation.
off-take of Chinese manufacturers on account of
Sunil Hitech Engineers recommended at Rs.193 zoomed to
weak demand and the shift to green tyres could
Rs.314.6 level recording 63% appreciation.
result in lower demand for natural rubber thereby
DISH TV India recommended @ Rs.95 zoomed to Rs.117 level
keeping prices low. Thus, industry experts expect
recording 23.15% appreciation.
tyre companies to benefit from lower raw-material
Indian Hume Pipe Company recommended @ Rs.288 zoomed
costs.
to Rs.377 level recording 31% appreciation.
MRFs exposure to the replacement market and non Bajaj Electricals recommended at Rs.264 zoomed to Rs.310
CV market has aided the company to maintain the
levels recording 17.42% appreciation.
best margin profile among its peers consistently.
DCB Bank recommended at Rs.125 zoomed to Rs.151 level
Higher contribution of replacement tyres (76%),
recording 20.8% appreciation.
strong brand recall and better product mix has
Techno Funda Plus subscribers have earned handsome profit in the
enabled it to garner higher gross margins while a
above stocks. Now the 10th Edition will come out in the first week
diversified product mix has enabled it to maintain
of September 2015. To get profitable Techno Funda ideas like
high utilization (which reduces EBITDA volatility
above
dont wait till end August. Book your subscription from now.
during a downturn).
For more details contact Money Times.
Due to its comparatively higher growth, MRFs
revenue share in the domestic tyre industry
improved to 29% in FY14 from 25% in FY10. It also claims leadership position in the PCR (passenger car radial) tyre
segment with 28-30% share in the replacement segment.
Going forward, it is believed that MRF will be able to maintain industry-leading EBITDA margin on the back of scale,
strong brand recall, higher pricing power and better product mix.
Based on the current going, MRF is all set to garner an annualised EPS of Rs.3700 in FY16 and Rs.4500 in FY17. At the
current market price of Rs.44933.80, the share trades at a P/E of 12.1 on FY16E and 9.9 on FY17E earnings. A
reasonable P/E of just 16 will take its share price to Rs.59200 in the medium-term and Rs.72,000 in the long-term on
FY17E earnings. The 52-week high/low of the share has been Rs.46405/23130.
**********
Renaissance Jewellery: For glittering gain

18
The share of Renaissance Jewellery Ltd (RJL) can be bought for glittering gains as this diamond jewellery firm faring
extremely well in FY16 and is all set to post an EPS of Rs.25 in FY16 and Rs.28 in FY17.
Incorporated in 1989 as Mayur Gem and Jewellery Export Pvt Ltd, RJL is engaged in the business of jewellery. In 1997,
the Company's name was changed to Renaissance Gem & Jewellery Export Pvt Ltd. In 1998, Sur Style Jewellery Pvt Ltd
('Sur Style') engaged in the manufacture and export of studded jewellery was merged with the company. In 2005, RJL
was converted into a public Ltd company and the name was changed to Renaissance Jewellery Ltd.
RJL tapped the capital market in December 2007 with an issue of 53.24 lakh shares at a price of Rs.150 per share
aggregating Rs.79.86 crore of the IPO proceeds, Rs.35 crore was spent on setting up an US subsidiary, Rs.10.5 crore on
expanding manufacturing capacity at Bhavnagar, Rs.5 crore on modernisation of its Mumbai facility and the rest as the
working capital. RJL operates through 6 manufacturing units based in Mumbai, Bhavnagar and Bangladesh with capacity
to produce 2.5 million pieces per year and employs 4000 skilled employees.
Apart from its core jewellery business, RJL has its own Home Retail Brand House Full with 31 stores across India
offering all types of furniture and caters to all segments, bringing appealing designs, lasting quality, and value for
money tag at their doorsteps. In FY14, RJL added 5 new stores and currently has 31 stores (126,364 sq. ft.) across India.
It is present in the regions of Mumbai, Pune, Nasik, Ahmedabad, Surat, Baroda, Bangalore, Hyderabad and Chennai. RJL
has plans on exploring opportunities in other regions in the years to come with a 5-year goal of over 100 stores across
the country.
For FY15, net profit rose 36.3% to Rs.40.2 crore on 1% higher sales of Rs.227.6 crore. The consolidated FY15 EPS stood
Rs.21 Vs Rs.15.4 in FY14 and a dividend of 10% was paid.
For Q1FY16, consolidated net profit zoomed 100% to Rs.4.8 crore on 13.5% higher sales of Rs.252.6 crore and the EPS
was Rs.2.5.
Thanks to judicious working capital management, net debt in Q1FY16 stood reduced to Rs.197 crore from Rs.289 crore
in Q1FY15 and Rs.272 crore in FY15 as compared to FY14 debt of Rs.342 crore. There has thus been a solid reduction in
debt, which will result in lower interest outgo going forward.
RJLs equity capital is Rs.19.1 crore and with reserves of Rs.380 crore, the consolidated book value of its share works out
to Rs.209. The value of its gross block as at FY14 stood at Rs.146 crore. Loans, investments, cash etc were Rs.120.8 crore
or (Rs.63.2/share) as at FY15.
In FY14, the Indian gems and jewellery sector contributed US$34.75 billion to Indias foreign exchange earnings (FEE)
with a decline of 11% as compared to FY13. The export of gold jewellery and gold medallions together during 2013-14
stood at $11.05 billion which shows a drop of 39.50%.
This was mainly due to the non-availability of gold limiting the extent of trade for many Indian players. Silver jewellery
exports, however, encountered a significant increase of 58.57% at $1.46 billion. A FICCITechnopak report predicts that
gems and jewellery exports may touch US$58 billion by 2015.
The Reserve Bank of India (RBI) has liberalised gold import norms. With this, star and premier export houses can import
the commodity while banks and nominated agencies can offer gold for domestic use as loans to bullion traders and
jewelers. Also, India has signed a MoU with Russia to source data on the diamond trade between two countries.
India is the top global processor of diamonds, while Russia is the largest producer of rough diamonds. In an effort to
develop Mumbai as a rival to Antwerp and Dubai, which are currently the top trading hubs for diamond, the Government
of India is planning to establish a special zone with tax benefits for diamond import and trading in Mumbai.
With a mission to strive and attain market leadership by product and process innovation, RJL will further enhance its
reach in USA with new market segments and product categories and grow its business in the European Union across
major retailers to sustain and strengthen its position of proven leadership.
Based on the current going, RJL is all set to garner an EPS of Rs.25 in FY15 & Rs.28 in FY17. At the current market of
Rs.83.45, the share trades at a forward P/E of 3.3 on FY16E EPS and 2.9 times the FY17E EPS. A conservative P/E of just
5 will take the share price to Rs.125 in the medium-term and Rs.140 thereafter. The 52-week high/low of the share has
been Rs.110/57.90.
STOCK SCAN
VA Tech Wabag Ltd: Profiting from purification

19
By Dildar Singh Makani

There is an ever ending shortage of potable water all over the world. With the rising population and urbanization, the
problem is aggravated. Health conscious people prefer to consume good quality water especially as over 80% of diseases
are caused by drinking contaminated water. The poetic line Water, water everywhere but not a drop to drink aptly fits in
here. Authentic reports suggest that total fresh water to total availability is just 3% of which only 2.5% can be
considered as fresh water. This situation in all probability is an alarming situation. Therefore, investments in companies
engaged in recycling, water treatment, water conditioning, and desalination can be highly rewarding in time to come.
Va Tech Wabag possesses one of the best technical expertises with an impressive track record to its credit. The salient
features of making investments in this Company are as under:
Domestic demand in India is slated to rise significantly over the next few years. The demand for usable water,
sewerage water treatment is on the rise. In an attempt to provide good quality drinking water, the Government has been
spending big money to ensure that each and every household, even in the remotest village, has access to good quality
drinking water. As per official announcements, the Government plans to invest more than 7 to 8 lakh crore over the next
20 years to achieve this goal. With the Clean Ganga project, this budget figure can only rise. The total order book at the
moment is above Rs.6000 crore.
Va Tech Wabag has to its credit an EPS growth of around 16% in the last 3 years. And with the huge spending in this
sector, it can be safely said that the CAGR in the coming few years can be over 30%.
Strength and Weaknesses The Company has a professional team of experts. It has one of the best technical expertises
with a global presence. All its subsidiaries are going full throttle.
The only matter of concern is that most of its customers are municipalities and therefore receivable days are very high at
200 days or more. But to counter this problem, the Company is slowly turning to industrial orders, where the receivable
days will be relatively smaller.
History: The Company was formed in 1995 as Balcke Durr Cooling Towers Ltd. In 1996 its name was changed to Balcke
Durr and Wabag Technologies. In 1999, the Company was acquired by an Australian major Va Tech and in 2000 the
name of the Company was changed to its present name.
The business of the Company revolves primarily to designing, supply, construction and erecting of water, waste water
treatment plants, including operation and is a maintenance of the same.
Investment Rationale: The Company has been consistently reporting better results. It has always maintained excellent
relations with its customers and had never felt the need to write off any part of its receivables. Apart from Indian
companies and municipalities, the Company has successfully executed order from international agencies. The order
book position is continuously rising. The Company has also received a big order from Govt. of India to clean the Gang
River and probably the only Indian company to have won this. On the face of it, at the CMP of around Rs.766.55, the
share looks costly considering that it is available at a P/E ratio of 46. But a relook in the last 3 months, the Company has
received orders worth over Rs.1000 crore on the back of a bulging order book position. There is, therefore, no doubt that
this is strong company in terms of growth. In an interview to the media a few weeks back, the Company expects the
order intake this year to be in the range of Rs.3500 to Rs.3700 crore. Elaborating on the foreign orders received, the
company said it has got Rs.580 crore order for sewage treatment plant in Bahrain, Rs.220 crore order of raw water
treatment plant in Nigeria, Rs.85 crore pre treatment plant order in Saudi Arabia and Rs.65 crore order for waste water
treatment plant in Egypt.
Strategic Tie-ups: The Company has strategic tie ups with Sumitomo Corpn (Japan) Tecpro and Gammon India, and
Zawani (Sultanate of Oman). The company is, therefore, well-placed to deliver superb performance over the next few
years. The Company intends to use these tie-ups to convert sea water into drinking water.
Financials: In FY15, the Company declared a net profit of Rs.90.41 crore as against Rs.88.58 crore in the previous year
translating into an EPS of 16.65. The book value of the share is over Rs.126.
The results for Q1 are not yet out but if the strong order book is any indication, we can definitely expect exemplary
results not only in the present quarter, but in the next many quarters to come. It would not be out of place to expect the
Company to be able to post a CAGR of over 30 to 35% in the next two to three years. The consolidated results show that
the company posted a higher EPS of Rs. 20.35, which indicate that the subsidiaries are also making good profits. The
company declared a dividend of 200% and also rewarded its shareholders with 1:1 bonus shares.
Shareholding pattern: The Indian promoters hold a little above 11.15% whereas foreign promoters hold 17.84%. It is
worthy to note that Mutual funds hold about 21%, and foreign investors hold another 29%. If we consider that bodies
corporate hold about 8%, the floating stock is limited to about 13%. The shareholding pattern suggests that the
company commands high esteem of the mutual funds and also other foreign investors.
20
Warren Buffet has repeatedly said Buy a share if you can get a good sleep even if the stock exchanges were to remain
shut for a pretty long time. That is why he advocated that once you buy this share, do not call up your broker every 15
minutes to know its price. The price of a potentially strong share will definitely go up if you have made the right
investment decision.
Our advice to you isBuy this share for a minimum 2 years and watch it bloom.
TECHNO FUNDA
By Nayan Patel
Kanco Tea & Industries Ltd.
REVIEW

On 22 June 2015, we had recommended Deepak
Spinners @ Rs.46.9. Within six weeks, it zoomed
Listed only on the BSE and belonging to the Kanoria family of
to Rs.78.85 level recording 68.12% appreciation.
Kolkata, Kanco Tea was created by demerging the Tea division of
Kanco Enterprise Ltd. Kanco Tea has 2 Tea estates namely,
On 6 July 2015, we had recommended Kamadgiri
Mackeypore Tea Estate and Lakmijan Tea Estate. Kanco is known
Fashion @ Rs.62.1. Within just one month, it
for its high quality premium Tea which fetches higher price at
zoomed to Rs.115 level recording 85.18%
auctions. Tea cultivation is done over 1136 hectares of land on
appreciation.
the South bank of river Brahmaputra in Assam which is known as
Last week, we recommended Twenty First
the quality belt of Tea. Kanco Tea produces over 2 million kg of
Century Management Services @ Rs.39.95.
tea annually.
Within one week, it zoomed to Rs.49.90 level
Kanco Tea has an equity base of just Rs.1.71 crore that is
recording 24.9% appreciation. We also
supported by reserves of around Rs.20.39 crore, which is 11.92
recommended Panama Petrochem @ Rs.74.
times higher than the equity and has a share book value of
During the week, it zoomed to Rs.82 levels &
Rs.135.76 and price:book value ratio is just 1.1, which is highly
recorded almost 10.81% appreciation.
impressive. The promoters hold 70.35% while the investing
Most of these stocks were featured in Techno Funda
public holds 29.24% stake in the company.
Plus (TFP) earlier and have yielded higher gains to
For Q1FY16, it
Financial Performance:
(Rs. in crore)
Techno Funda Plus subscribers.
reported
sales
of
Particulars
Q1FY16
Q1FY15
FY15
Rs.5.09 crore as
Sales
5.09
4.70
34.08
against Rs.4.70 crore in Q1FY15. While PAT jumped 45.31% to Rs.1.86
PBT
1.86
1.41
3.40
crore, the Q1FY16 EPS stood at Rs.10.89.
Tax
0.13
0.31
The scrip is trading at P/E multiple of just 8, which is the lowest P/E ratio
PAT
1.86
1.28
3.09
in the Tea sector. It paid 50% dividend for FY14 & FY15. Most Tea
EPS (Rs.)
10.89
7.50
17.93
companies are booking losses Kanco Tea is showing good results.
Investors can buy this stock with a stop loss of Rs.140. One the upper side, it will zoom to Rs.200 level in the mediumterm. At a P/E ratio of 15, its share price will touch Rs.270 in the next 12-15 months.
Editorial & Business Office:

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Editor & Publisher: R.N. GUPTA
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BANGALORE: V. Raghurama Reddy (Mobile: 9591763126 / 9379559166)
DELHI: P. K. Vasudevan (Mobile: 9810513247)
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Printed & Published by R.N. Gupta for the proprietors Time Communications (India) Ltd. and printed by him at The Dangat Media Pvt. Ltd.
Mehara Center, Marwah Estate, Opp. Tata Power, Near Piknik Hotel, Off Saki Vihar Road, Saki Naka, Mumbai - 400072. Registration No.:
63312/91, Post Regn. No. MCS/006/2015-17
Disclaimer: Investment recommendations made in Money Times are for information purposes only and derived from sources that are deemed to
be reliable but their accuracy and completeness are not guaranteed. Money Times or the analyst/writer does not accept any lia bility for the use of
this column for the buying or selling of securities. Readers of this column who buy or sell securities based on the information in this column are
solely responsible for their actions. The author, his company or his acquaintances may/may not have positions in the above mentioned scrip.
21
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6 mnths = Rs.13000, 1 yr = Rs.20000
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6 mnths = Rs.11000, 1 yr = Rs.18000
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T I M E S: Market Yearns For Fresh Triggers

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Nifty & Bank Nifty (Live Market) (SMS)

1 mnth = Rs.3000, 1 yr = Rs.24000

1 qtr = 2500, 2 qtrs = Rs.4000, 1 yr = Rs.7000

Live Market Intra-day Calls (SMS)

Beat the Street 9 (Courier/Online)

1 mnth = Rs.4000, 1 yr = Rs.36000

1 qtr = 3500, 2 qtrs = Rs.6500,

Profitrak Daily (Online)

Fresh One Buy-Daily (Online)

1 mnth = Rs.1500, 1 yr = Rs.12000

1 mnth = Rs.2000, 1 yr = Rs.18000

1 mnth = Rs.1500, 1 yr = Rs.12000

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1 mnth = Rs.3500, 3 mnths = Rs.7000

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Profitrak Daily Fresh Futures (Online)

Investment Advisory Service (Phone/Email)

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