BHARAT FORGE Q1FY11 Is Expected Good Stay Invested

BHARAT FORGE Q1FY11 Is Expected Good Stay Invested,


The second largest forging company in the world, Bharat Forge.
It scaled new high of Rs.328.55, since the buzz around this company remains very positive.

Almost all brokerage houses have put out a ‘buy’ for this stock.

The company is making moves to increase its presence in the non automotive sector, which is largely related to energy, infrastructure, marine and railways. The company has entered into deals with Alsthom and Areva and both these are expected to start adding on to the revenues from 2012.

ALLAHABAD BANK Remains a good banking stock to hold

Why ALLAHABAD BANK Remains a good banking stock to hold?
The ALLAHABAD BANK presented a very good results for the first quarter ended 30th June 2009. For Q1FY10, the bank posted a YoY 28% rise in total income earned at Rs.2377.70 crore. Deposits were at Rs 89,400 crore and advances at Rs 61,000 crore, meaning the total business of the bank has crossed Rs,150,000 crore. Operating profit was at Rs 591 crore almost twice that was posted in Q1FY09. The net profit rose three times at Rs.302.86 crore. This surge is more pronounced as in Q1FY09, the bank had made a huge provisioning of Rs.202.24 crore as against Rs.39.63 crore in current Q1. Its net interest income grew 34.3% to 629 crore. The growth in trading profit was also quite smart – it was up over 5 times at Rs.214 crore.
The bank has recovered Rs 50 crore from defaulters. It upgraded loans to the tune of Rs.97 crore and has written off Rs.50 crore. Gross NPA is at 1.79% as against 1.87% in Q1FY09 and net NPA was at 0.37%, up from 0.72% in Q1FY09.
This is one of the oldest public sector banks of India, established way back in 1865. The Govt of India has a 55.23% stake and institutions hold 26.45% of which LIC has a 11.63%, leaving a floating stock of 18.32%.
The stock touched a high of Rs.90 on 2nd June 2009 in anticipation of the Budget making some favorable recommendations, Since then, it has come down but yet managed to hold strong and is now quoted at Rs.79. Remains a good banking stock to hold. thanks

INDOWIND ENERGY Stay away Stock

Net profit is at Rs.7.06 crore, its highest ever in any quarter and almost equal to Rs.7.20 crore which it posted for 12 months FY09. QoQ, net profit is up more than 7.5 times and YoY, it is up 60%.
It has a net sales for Q1FY10 of Rs.8.83 crore, down 72% on a QoQ and down 34% on a YoY. OPM is at an unbelievable 101% and NPM at 80%. This is even better than a realty company!
The company has an other income of Rs.2.19 crore and operating expense is down to a meager Rs.2.05 crore of which Rs.1.81 crore is via ‘other expense’ and Rs.24 lakhs on employee cost . Where is the expense on raw materials? Does this mean that income in first quarter was from trading income only? Something somewhere smells completely fishy here.
The stock was up yesterday by 9.76% at Rs.36. Purely a speculative stock. Just get out using this momentum as the results are more of a warning than a sign of good tidings. thanks

IDFC Yet Another Strong Infra Stock to Invest

After long wait today I made purchase on IDFC. This highly reputed infra company, despite the trying circumstances, has posted a good set of results for the year ended 31st march 2009. Its Net Interest Income (NII) increased by 33% to Rs.922 crore and of this, NII came from infrastructure loans, which increased by 34% to Rs. 758 crore and NII from treasury operations increased by 27% to Rs.164 crore.
After accounting for Rs. 278 crore for tax, profit in associate company and minority interest, net profit for FY09 was stagnant at Rs.750 crore as against Rs.742 crore in FY08.
The biggest concern was IDFCs’ exposure to realty. Total disbursal outstanding to commercial and industrial infrastructure, as on 31st March 2009 stood at less than Rs.3,000 crore, accounting for about 12.9% of its total outstanding disbursements.
Govt continues to hold 20.2% stake in the company as on 31/03/09. FII/FDI holding has come down to 39.5% (46.7%), Mutual funds holding is at 7.7% (8.5%), Corporate Bodies have increased stake to 4.3% (3.5%) and retail has increased the most at 13.3% (7.7%).
Net NPAs was at 0.21% of outstanding loans. Capital Adequacy Ratio was at 23.75% (Tier I – 20.04%; Tier II – 3.71%).
FY09 was a tough year for IDFC and it adopted a cautious approach, adopted a better to be safe than sorry attitude. Now that things have settled, the company is back to concentrating on growth. Given the emphasis to infra, IDFC is poised to do well. thanks.

Nava Bharat Ventures Good Power Stock to Stay Invested

Nava Bharat Ventures got into power and sugar and that has been a very wise decision. It is power and sugar which has helped the company face the rough weather in FY09, especially in ferro alloys, where lack of demand since the end of Sep’08, forced the company to curtail production and shut its ferro chrome furnace.
Overall performance for FY09 was good. In the last quarter of FY09, the topline and the bottomline took a dip. The revenues for the quarter fell by 12.14% to Rs 303.36 crore and net profit declined by 16.13% to Rs.108.54 crore. Power segment sales rose by 92% while ferro alloys sales was down 74%.
For FY09, revenues of the company increased by 43.43% to Rs 1,350.05 crore and its net profit increased by a whopping 62.84% to Rs 520.57 crore. The company posted a forex loss of Rs.29.17 crore. It also bought back 1.93 million equity shares of Rs 2 each for Rs 23.26 crore and extinguished equal number of equity shares. After this, the paid up capital has come down to 7.59 million equity shares of Rs 2 each.
The company plans to go full throttle with its power projects and has plans to set up a 1,050MW merchant power plant (50: 50 JV with Malaxmi group) and another 64MW at its existing location in Orissa. Capex envisaged is Rs.4700 crore ad is expected to be commissioned by FY12. It has been allocated Rambia coal mine in Orissa with estimated reserves of 112 million mt. It also plans to put up another power plant in Andhra Pradesh.
This remains a good long term stock as it is power which will power the company in the coming months. thanks

Neyveli Lignite Corp (NLC) A PSU Stock To Stay Invested

NLC is involved in lignite excavation & power generation business. It supplies power to southern states and has a total installed capacity of over 2070 MW. Its plants are fully integrated with lignite (17 mn tpa) drawn from its own lignite mines. It also has a 129,200 tpa urea plant and a 262,000 tpa briquetting and carbonization plant.

This is one stock which has been in the upward mode right since the time UPA came back to power. It touched a high of Rs.147 on 5th June and today is quoted in the range of Rs.121 and it expected to more or less remain stable at these levels.
Neyveli Lignite Corp (NLC) a drop in production and this has affected the performance for FY09. Though the turnover of the company rose 13% at Rs. 3,355 crore, net profit fell by 25% at Rs. 821 crore.

To spread the risk of dependence on lignite, the company has now decided to diversify into hydro and wind sectors. It is looking at the possibility of setting up a 1,000-MW hydro electric project in Uttarkhand. It also intends to participate in the upcoming ultra mega power projects (UMPP) floated by the Power Ministry.
Its 2x250 MW lignite-based plant at Neyveli, which was to go on stream by Nov 2008 has been delayed and now it is expected to be commissioned this fiscal. The delay was due to the reluctance of technology supplier Lurgi to sign agreements with equipment supplier, BHEL. The matter has since been resolved by NLC accepting that BHEL will assume the full responsibility for the technology.
The Govt holds 93.56% of NLC’s equity while financial institutions hold 4.38%. LIC has a 2.48% stake. For now, stay invested in this PSU. thanks

THERMAX Remains a Very Good Investment

The financial performance of Thermax for year ended 31st March 2009 company has managed to keep its head way above the water.
The company showed a 1.75% rise in total income at Rs.3303 crore. Export income, including deemed exports, increased by 35 % to Rs. 912 crore. The consolidated income of the group was lower by less than one percent at Rs. 3501 crore. Net profit rose marginally by 2% at Rs.287 crore. The Board recommended a dividend of 250% (Rs. 5 per share of face value of Rs. 2).
The fourth quarter performance indicates that things are surely improving. In Q4FY09, the company posted an income of Rs. 960 crore, up by 3% on a YoY. Net profit was up 17% at Rs.94 crore.
The Thermax group order book, after consideration of renegotiated orders, stands at Rs. 3078 crore as on March 31, 2009 compared to Rs. 2637 crore in the previous year. During the year, the company has received some prestigious orders for captive power plants, utility boilers, municipal sewage treatment and performance chemicals for the oil sector.
Clearly, things are on the upswing. It will take a while to bounce with vigour but the energy is back. Thermax remains a very good investment– as its orders to the power sector will get a fillip as it remains a priority sector for growth. Specialising in energy conservation systems and captive power projects, Thermax is likely to profit from the growing importance for energy management among its user industries. stay invested. thanks

NOIDA TOLL BRIDGE A Safe Bet in Recession

Why NOIDA TOLL BRIDGE A Safe Bet in Recession?
Warren Buffet has stated that toll bridge companies are always a good stock to hold in one’s portfolio as every time a car passes through, the company earns money and be it recession or boom times, people do travel within the city. So toll bridge companies are always assured of returns, as population always goes up and number of cars plying also only goes up.
Noida Toll Bridge is one such company, probably the only listed toll bridge stock on the BSE. The entire bridge was opened up, even the second phase of Mayur Vihar Project on 19th Jan 2008 and since then, the company has been doing well. It ended 31st March 2009 with a 19% rise in net sales at Rs.79.83 crore. Operating and maintenance costs continue to remain high, infact have gone up in FY09 to Rs.3.48 crore from Rs.1 crore in FY08. The staff costs have also gone up from Rs.6.64 crore to Rs.10.31 crore. The company ended the year with a net profit of Rs.33.53 crore, up 20%. The good part is that the company has always managed to have a consistently good profit margin. For FY09, on an average, its OPM was over 74% and NPM was over 39%.

The company’s biggest asset is its land bank of 235 acres on either side of the bridge – 200 acres on Delhi side and 35 acres on Noida side, valued at around Rs.1000 crore. The company is awaiting permissions to start development. Once that happens, this land bank will be its milch cow. thanks

Indraprastha Gas Limited (IGL) Think About It

IGL Looks good.
Indraprastha Gas Limited (IGL) is India’s biggest gas distributor, owned by the state-run GAIL and Bharat Petroleum. It supplies compressed and piped natural gas for Delhi and its outskirts. Results for the third quarter ended had not good, But its performance for the fourth quarter of FY09 was good, with improved OPM and NPM on a QoQ basis.
For FY09, IGL registered a turnover of Rs 857.12 crore, posting a sales value growth of 21%.The company reported a 1.14% decline in net profit at Rs.172.47 crore. The biggest impact was on account of the demand of Rs 17.50 crore received from supplier of natural gas for excess drawl of gas for July-December 2008. OPM was down from 45.82% to 38.07% and NPM was down from 24.71% to 20.12%.
The company has signed up for a gas requirement of 0.2 million metric standard cubic metres a day (mmscmd) with GAIL and BPCL. It will also get 0.3 mmscmd of gas from Reliance Industries’ K-G basin.
Over the next 12 months, IGL plans to spend Rs.1600 crore to expand its retail network to 240 retail outlets before the commencement of the Commonwealth Games in October 2010. It has been allotted land for 18 outlets and more are in the process of being allotted. We have been allotted land for 18 outlets and more are in the process of being allotted. The company plans to add 50,000 new PNG connections in the current financial year and take the total PNG connections to 300,000 by 2012.
With the importance given today to environmental friendly companies and priority to petrol/diesel substitutes which are clean, IGL is poised to do well. Being an already established player, it also has the advantage of being amongst the first entrants. Think about it having in portfolio. thanks

REC RURAL ELECTRIFICATION CORPORATION Results Analysis

REC - RURAL ELECTRIFICATION CORPORATION Results Analysis
REC - PSU company has done well for itself for year ended 31st March 2009. With an objective of finance and promote rural electrification,
The share of generation segment in the entire loan book has gone up to 35% in FY09 while the share of T&D segment dropped from 63% in FY08 to 57% in FY09.
For the year, the net income rose 40.82% at Rs.4757.17 crore. Its interest outgo was up quite substantially by 40%. What is noteworthy is that REC’s provision for bad and doubtful debts has come down by a whopping 94%. Net profit was up 48% at Rs.1272.08 crore.
Why to invest in REC?
The Govt had launched the ambitious scheme of Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY) to electrify rural India with the aim of reaching power to 1.25 lakh villages and 2.34 lakh BPL families. As per the latest estimates, it will miss the target by 50% and the aim is now to electrify more than 63,000 villages in 2009-10. This may or not be done but the bottomline for REC is that there is immense scope. Power is one commodity which will be scarce in India and till that situation prevails, REC has a secure future.
And The company had gone public in Feb 08’ and had issued shares at Rs.105/share. Today it is quoted at around Rs.140 levels. The Govt has a 81.82% stake and institutional holding is 11.72%. thanks

McNALLY BHARAT ENGINEERING Stay invested

McNALLY BHARAT ENGINEERING A a joint venture between the Williamson Magor group and GP Birla group, the company currently seems to be on a roll. The stock has been moving up since the last few days and continues to remain above Rs.100. And the reason – it’s MoU with KHD Humboldt Wedag International GMBH for acquiring its engineering workshop in Cologne, Germany and coal & mineral technology (CMT) business based in Germany, India, South Africa, Russia and China.
The company has posted a very good performance For FY09, the company’s net sales more than doubled to Rs.1107.42 crore. EBIDTA was up 110% at Rs.91.28%. Net profit was up 42% at Rs.31.86 crore. A look at the margins – OPM was up at 8.24% from 7.91% in FY08 but NPM shows a marked slip to 2.88% from 4.08%.
Williamson Magor & Co, a promoter group company, pledged nine lakh shares representing 2.89% stake of the company. Williamson Magor held 2.96% stake in the company, while the total promoter shareholding stood at 32.30% as on 31 March 2009.
Why McNALLY BHARAT ENGINEERING Stay invested?
But with an order book of Rs 2200 crore and with bids for Rs.4075 crore in the pipeline, there is no doubt that the company is poised for very good growth.
McNally Bharat has a good order book and in the current uncertain times, such brick and mortar companies are a better bet. Stay invested. thanks

Noida Toll Bridge Good Share To Hold On

Noida Toll Bridge advised to hold and even buying can be made at the current levels with 6 months view check out why. Noida Toll Bridge had posted better results for year ending 31st March 09 with total income at Rs.79.21 crores against Rs.66.39 crores of FY 08. PBT improved to Rs.39.86 crores against Rs.31.78 crores.
Average daily traffic in FY 09 rose to 99,734 vehicles against 84,261 vehicles in FY 08, registering a growth of 18%. Since, the company collects toll from each vehicle, its income for the year also rose by 19% in FY 09. Average traffic on Mayur Vihar Link, for FY 09, was at 12,350 vehicles per day while it was at 13,632 vehicles in March 09, quarter, showing a case of rising trend of vehicles using it.
PAT of the company, for FY 09 is placed at Rs.33.69 crores (Rs.27.98 crores) resulting in an EPS of Re.1.81 for FY 09. The company adopted guidance note on “Accounting for Service Concession Agreement” issued by ICAI, whereby, Delhi Noida Link Bridge, which was earlier shown as fixed assets, is now shown as intangible asset w.e.f. 01-04-08. Intangible asset is shown at cost, being fair value of construction services. Due to this change, depreciation for FY 09 is lower by Rs.4.97 crores, thus increasing profit to that extent. Earlier, when it was taken as fixed assets, depreciation was provided on straight line method taking life of 62 years, but now, estimated useful life of bridge has been considered as 100 years and intangible assets is amortized over the same life.
Apart from this, the income flow of the company will come from development rights of 235 acres of land, of which, 200 acres are at Noida side while 35 acres at South Delhi side.
Share now ruling at Rs.27 translates into a market capitalization of just Rs.500 crores and even considering debt, the enterprise value works out to, less than Rs.700 crores. Once, the company is able to get clearance of land development, this shows that we will see good rise in share price from Rs.27. Advised to hold and even buying can be made at the current levels with 6 months view. thanks

RENUKA SUGAR One of Bullish Sugar Sector Stock

Keep a bullish view on the Big Sugar Companies and sugar sector. One more big sugar company posted results. Renuka Sugar has posted net profit of Rs.33.20 crores on total income of Rs.443 crore for second quarter ending 31st March 09, on consolidated basis. These results either look bad or flat when we compare it with the results of corresponding quarter, in the previous year, as PAT was at Rs.32 crores on total income of Rs.561 crores. So, a drop in the topline of 21% and rise in PAT by just 3.75% . Does this mean that the company has not been able to take advantage of bullish cycle of sugar sector?
Wall These results are very good. This is because, there is an increase in stock and inventory of Rs.336 crores during the quarter, while for 6 months ending it has risen by Rs.578 crores, which were risen by Rs.174 crores and Rs.274 crores, respectively for the respective period in the previous year.
The company has also made huge import of raw sugar, estimated to be close to 40 lakh bags, on which, it is likely to make a PBT of Rs.150 crores. In sugar segment, the company had an EBIT of Rs.20.60 crores for March 09 quarter on income of Rs.294 crores while same were at Rs.10.30 crores on Rs.159 crores in the corresponding quarter of previous year.
In summary, results are very good if we consider the gain to be made by the company on its inventory in the coming quarters and not to forget for keeping a bullish view on the Big Sugar Companies and sugar sector thanks

Bajaj Hindusthan Q2 results of Largest Indian Sugar Mill

Bajaj Hindusthan has posted flat results for Q2 March 09. Optically it looks good, which is due to reversal of forex losses of Rs.83.66 crores provided earlier and now credited back to profit & loss account.
However major disappointment is from its sugar and distillery segment. The company, as at 30-09-08, had a closing stock of 35.56 lakh bags of sugar, valued at Rs.16.25 per kg., at Rs.578 crores. It is learnt that the company had crushed 64 lakh tonnes of sugarcane in the current season and has produced 57 lakh bags of sugar with a recovery of 8.9%. Part of opening stock, out of 35.56 lakh bags, were sold in Q1 and remaining quantity got sold in Q2. In Q1 average sugar realization was at Rs.17.75 per kg. while it was at Rs.20.60 per kg. in Q2. So, sugar segment earned an EBIT of about Rs.4.35 per kg. But this is not reflected in the results as its sugar segment had an income of Rs.408 crores and EBIT of just Rs.30.50 crores. Even distillery for Q2 had a turnover of Rs.38.63 crores and negative EBIT of Rs.1.19 crores which is surprising.
Considering overall results, the company being the largest sugar mill in the country with a capacity of 96,000 TCD, has really disappointed. thanks After election results, sugar stock will show good results, keep the good sugar stock in your account.

Yes Bank Think About It Results Pattern

Yes Bank has posted good results for Q4 with total income rising to Rs.656 crores against Rs.494 crores in the corresponding quarter of the previous year. PAT for the quarter is at Rs.80.11 crores against Rs.64.50 crores, resulting in an EPS of Rs.2.70 for Q4, against Rs.2.18 of the corresponding quarter of the previous year.
Share touched its 52 week low of Rs.41, on 9th March 09, when all the private sector banking stocks took a beating. Since then, it has been going up and now ruling at Rs.77, which discounts its historic earnings by less than 8 times. It is certain to see growth from bank, even in FY 10 and an EPS of Rs.12 is most likely, which discounts the current price by about 6.50 times. Those who have 6 months view can expect the share price to move in three digits.
Price behaviour of this stock reminds old price movement pattern of HDFC Bank, about 12 years back, which has now become a private sector giant. This Bank also has all such ingredients to grow big in the long run. thanks

Mastek Ltd A Good Mid Cap IT Stock To Buy

Why Mastek Ltd A Good Mid Cap IT Stock To Buy?
Mastek Ltd. having posted its Q3 results for quarter ending March 09, has posted flat results. Total income for Q3 is placed at Rs .233 crores against Rs.251 crores of Q2 while PAT has been at Rs. 33.38 cr. for Q3 against Rs.31.33 crores of Q2.
However, Share price having taken a beating to Rs. 97 on 13th March 09 is now finding value and has moved to Rs. 146, post results. EPS of Rs. 12.41 for Q3 and Rs. 39.33 for 9 months ending March 09 makes the stock affordable and attractive at a PE multiple of less than 3 times.

Though all mid cap IT stocks have the same fate on valuations front, this stock looks attractive, which can move to 170 levels, by the time company will announce its Q4 results. thanks

THERMAX Looks Good Stock to invest

The financial performance of Thermax for the third quarter ended 31st Dec 2008, on a QoQ has been better than its performance when compared on a YoY. Q3 net sales QoQ was down marginally by 1.12% at Rs.795.06 crore while it was down 6% YoY.
Net profit YoY might have come down but the profit margins have been better. NPM was at 9.09% as against 8.87% in Q3FY08.
It has an order book of Rs. 4,103 crore as of December 31, 2008. The company expects execution of orders slowing down and in Q4 it does not expect the situation to be any different from what it was in Q3.

Why thermax is good stock to invest?
Thermax is a good investment stock option.

1. its orders to the power sector will not get unduly affected as power remains a priority sector for growth.
2. it is a zero debt company, a rare breed to come across in today’s time.
3. with inflation down, its costs would come down further, which in turn would help maintain the bottomlines.

Thanks

BASF India Invest in Low Beta Stock

BASF India has not done too well for the third quarter ended 31st Dec 2008. Net sales fell 9.75% to Rs 20,099 crore on a YoY. But the decline in net profit was sharper. It was down by a shocking 96.27% on a YoY at a meager Rs.41 lakhs. OPM was down from 9.91% to 3.22% and NPM was down to a paltry 0.205 from 4.94%. Economic slowdown & steep fall in prices since September 08 affected sales & profitability of some of the segments. Inventory increased significantly YoY to Rs.15 crore v/s Rs.61 lakhs
In September, its parent company made an open offer to acquire to acquire Ciba Holding AG, Basel, Switzerland, [CIBN], and was expected to make a public takeover offer to Ciba’s shareholders. BASF will pay CHF 50.00 in cash for each nominal share in Ciba.

On 9th March, the stock touched a new low at Rs.163. Currently quoted around the low levels, stay invested. It is one of those stocks, which are just to be held on to, not speculated upon. thanks

BHEL Buy at Every Dip as Good Blue Chip Stock

Bharat Heavy Electricals (Bhel), the country’s largest power equipment manufacturer, managed to buck the slowdown but surely the flat bottomline is a pointer to some effect surely playing on the performance of the company. Compared to the superlative growth shown by L&T in Q3FY09, that of BHEL has been more subdued.
It posted a meager 2% increase in net profit at Rs.791 crore while net sales rose 21% at Rs 6,022 crore. Despite costs coming down, the cost incurred in raw materials remains a concern. Its consumption of raw materials amounted to Rs 4,059 crore, which was 67% of net sales as against 57% in Q3FY08.
Orders worth Rs.15200 crore were received during Q3FY09. The order outstanding was at about Rs.113500 crore. Every other day, we see that BHEL has received an order and most of the time, almost all the orders are big ticket orders. This, to a large extent is reassuring as it means the company is showing no signs of a slowdown. It has enough orders to keep it busy and the cash registers ringing for the current fiscal.
Now the big question – L&T or BHEL? Both are blue chips and a must in any valuable portfolio. Right now, in this scenario of slowdown, BHEL has a march over L&T on two counts – firstly, over 60% of the orders of L&T comes from the private sector and hence it could face some slowdown if the companies decide to cut down on their capex or postpone it for later. For BHEL the order backlog is huge and for BHEL, it’s a question of how and when to complete rather than what to complete. L&T has been cautious when it announced 30% guidance for FY09 and its current takeover bid of Satyam is also causing some jitters. Mind you, L&T also remains a great buy.
Advice :
Every dip, use it for accumulating BHEL for the long term. thanks

MOTHERSON SUMI Pick up the stock for the long term

There has been a buzz around this stock for some time now, in anticipation of it completing the acquisition process of Visicorp. Well, it was finally done on 16th March and since yesterday, profit booking has once again come into the stock and it has now settled back in the Rs.50’s levels.
The company, through its JV - Samvardhana Motherson Finance acquired one of the world's leading manufacturers of automotive exterior mirrors, Visiocorp for Rs 176 crore. The acquisition will help Motherson Sumi Group to offer entire range of automotive parts, which would include rear view mirrors, to the global customer base. Only, the auto sector, globally has hit the brakes for now.
For the third quarter ended 31st Dec 2008, the net sales of the company dropped 11% on a QoQ while it rose marginally by 8% on a YoY at Rs.557 crore.The company had a forex loss of Rs.6.96 crore for the quarter.

Pick up the stock for the long term on declines. thanks