Smallcap Stock Ideas To Play In 2016
1) KEI Industries Ltd
KEI Industries: KEI Industries story is more structural. One of the reasons the stock looks like a potential bet is because that there are two constructs around the whole argument for us for KEI. First, there is a significant opportunity building up in the EHV space which is the extra high voltage space, wherein they are one of the only two other Indian manufacturers who have the capability and the eligibility to bid for the tenders.This is a market which is primarily an import substitute, and we are looking at about market size of close to about $250 million growing at about 15-20%. An investment into the transmission and the distribution side will help the company to capture smart city projects and whole lot of other initiatives at the state government level. The second key argument is that, there has been a significant retail push which now stands at 30% from about 15-20% earlier. It might seem more like a lower margin business, because of the working capital issues which is not the case here.
It is more like a cash and carry kind of a structure that they follow, and therefore we believe that the ability to brand that and capture market share over a period of time will help them neutralise the other businesses which are lower margin.
2) Pokarna
Pokarna: It is a company which is still plying below the radar of many investors, because it was not very big. It is still quite small, but if you look at the business they are in, it is remarkable. The business is related with the export theme. The granite which is used as kitchen marble, they export to US and also if you look at the certification which are required to supply that kind of a commodity to these countries.
It is very-very stringent and very -very difficult to get, and also in terms of various other certification and regulation which are in place, this is a company which has done that part very-very well. Looking at the core business they are in, they are one of the market leaders, and also they have been very-very successful in getting all the regulatory things in place.
3) Surya Roshni Ltd.
Surya Roshni: Surya Roshni is something that we like, because of governments recent push to sell LED bulbs. The lighting industry should do pretty well. Within that, the LED segment should contribute 30% over the next couple of years. Fans and other appliances have been doing well, and we expect them to hit that Rs 200 crore odd market respectively. Again, the steel business has been a drag, but clearly the lighting business is performing very well and the debt levels have actually come down by Rs 65-odd crore in the first half itself. The stock valuation at 7.5 times look pretty attractive to us at the current juncture.
4) Visaka Industries Ltd.
Visaka Industries: Visaka Industries is more of a smallcap play. But, if you look at their asbestos cement products division that has not been performing well, but the expectation is that in the next two years with a 70% market share it should do reasonably better. The division has done exceedingly well. Their synthetic yarn division has done well. So, Visaka Industries on decline is something that long-term investors can look at.*******************************
- Leading maker and exporter of novelty fabrics: Orbit Exports (Orbit) is a leading manufacturer and exporter of novelty fabrics exporting its products to over 32 countries. The company is a recognised star export house and operates in the niche area of high-end fancy fabrics, which are mainly used by designers in women’s fashion apparels. It has around 600 clients and serves marquee names like Zara, Calvin Klein, Home Depot, Adriana Purple, H&M and Hobby Lobby. The company is also amongst the largest exporters of Christmas ribbons and other festival related made-up products in India.
- Strong turn-around witnessed after management change: In 2003-04 when owing to dismal financials and loss of clients, Orbit was on the verge of being referred to the BIFR the present management led by Pankaj Seth bought the company. The loss-making company, with eroded net worth, was revived and turned around with ethical manufacturing practices and strong connects with clients. Today in the textile space, Orbit generates among the highest margins and returns for its shareholders.
- Unique designs and small order size enable to differentiate business and earn superior margins: The company has been able to tap this lucrative high-margin business through its strong focus on design and quality. It has an in-house design studio that produces around 600 designs every season; also no design ever gets repeated and the maximum shelf life of every design does not exceed six months. With its strong grasp on trends in global fashion apparels, high emphasis on quality and on-time delivery along with robust and focused marketing initiatives, the company has been able to transform itself from an ailing textile company to a highly thriving business.
- Strong financials; moderate capex to support valuations; initiate Buy rating: Over the last five years, the top line, and operating profit of the company have grown at a CAGR of 15% and 33.7% respectively. The net earnings have grown at a CAGR of 36.8% over the same period. The OPM has been on an expansion spree and currently stands at 27.9% as against 15% in 2011. A strong OPM profile has enabled Orbit to earn higher returns averaging at 21% in RoCE and at 33% in RoE over the last three years. Given the strong financials, niche capabilities and a vigilant management, the company is well poised for a strong growth in earnings. Hence, we expect its top line and bottom line to grow at a CAGR of 19.6% and 22.8% respectively over FY2015-18. Given the robust earnings potential and enviable return ratios, Orbit is expected to trade at higher multiples. Thus, we expect the stock to get re-rated (in line with its peers like Kitex Garments). We initiate coverage on Orbit with a Buy rating and value the company at 22x its FY2017E earnings to arrive at a price target of Rs630.
- Key risk: Around 70% of the company’s revenues come from the export market, a sharp appreciation in the rupee against the other currencies could affect the revenues and earnings of the company.
.................................................................................
* BUY INFOSYS
BUY AT :- 1167
TGT :-1200, 1220
SL :- 1135
THIS IS A MARKET MOVER COUNTER
(TGT DONE 1219.80 OCT 12 )
....................................................................
* BUY VEDL
BUY AT :- 103
TGT :- 115, 120
SL :- 94
THIS IS A STRONG VOLUME COUNTER
(TGT DONE 119.10 OCT 12 )
.....................................................................
* BUY SHOBHA
BUY AT :- 298
TGT :- 315, 325
SL :- 282
THIS IS A STRONG INVESTMENT COUNTER
(STOCK MOVE 298 TO 309.10)
...............................................................................
WE ARE STRONG BULLISH IN THIS COUNTER
BUY FOR ONE WEEK ( 21/ 9/2015 )
...................................................
* BUY SUNPHARMA
BUY AT :- 904
TGT :- 922, 935
SL :- 887
( TGT DONE 8 OCT 15 )
....................................................
* BUY INDIANBANK
BUY AT :-131
TGT :-135, 138
SL :-126
( TGT DONE 143.75 DATE 22 SEPT 15 )
.....................................................
*BUY AXISCADES ( ONLY FOR CLIENTS)
BUY AT :- 274
TGT:- 295, 310
SL :- 260
HOLD ONLY 10 DAYS
STOCK MAKE HIGH 340
TGT DONE DATE 19 AUGUST 15
*BUY NIFTYS 8400 PE
BUY AT :- 50 RS
TGT :- 100 RS
SL 30 RS
HOLD ONLY 5 DAYS
TGT DONE DATE 20 AUGUST 15
*******************************************
BEST STOK FOR ONE WEEK( 30 APRIL 2015 )
*******************************************
(1) BUY GANDHITUBE
BUY AT :- 277
TGT:- 285, 290
SL:- 270
( TGT DONE 299 21 MAY )
(2) BUY Jain Irrigation Systems Limite (JISLJALEQS)
BUY AT :- 59
TGT:- 63, 66
SL :- 57
( TGT DONE 67 RS 18 MAY)
(3) BUY PNB
BUY AT :- 162
TGT :- 167, 171
SL :- 155
( TGT DONE 180 RS 14 AUGUST )
(4) BUY ITC
BUY AT :- 127
TGT :- 131, 134
SL :- 124
( TGT DONE 335.90, 19 MAY )
(5) BUY ONGC
BUY AT :- 322
TGT:- 330, 333
SL :- 318
( TGT DONE 343 RS , 5MAY )
********************************************
BEST STOCK FOR ONE WEEK ( 15 APRIL 2015 )
********************************************
(1) BUY ADANIENT
BUY AT :- 660
TGT:- 675, 685
SL :- 640
(TGT DONE STOCK MAKE HIGH 712)
(2) BUY KTKBANK
BUY AT :- 135
TGT :- 145, 150
SL :- 125
(HOLD )
(3) BUY APOLLOTYRE
BUY AT :- 188
TGT :- 195, 200
SL :- 180
( HOLD )
HAPPY TRADING
**********************************************
BEST STOCK FOR ONE WEEK ( 6 APRIL 2015 )
*******************************************
(1) BUY IDFC
MARKET PRICE: 172
TARGET PRICE :180 , 185
(STOCK MAKE HIGH 178.85 APRIL 10 )
(2) BUY PNB
MARKET PRICE : 152
TARGET PRICE : 160 , 165
(PNB MAKE HIGH TGT DONE 166.90 APRIL 13 )
(3) BUY SAIL
MARKET PRICE : 70
TARGET PRICE : 73 , 76
( TGT DONE 76.45 APRIL13)
(4) BUY SUNPHARMA
MARKET PRICE : 1081
TARGET PRICE : 1100 , 1120
(TGT 1200 DONE APRIL 7 )
(5) BUY BANK NIFTY
MARKET PRICE : 18600
TARGET PRICE : 19000
(BANKNIFTY MAKE HIGH 18985 APRIL 9 ) ( HAPPY TRADING )
*******************************************
..... ................................................................................................
BEST STOCK FOR SHORT TURM BUYING (23 MAR 2015)
......................................................................................................
Indian Bank
Current market price: Rs 172
Target price: Rs 221
(MAKE HIGH 175 HOLD)
Suzlon Energy
Current market price: Rs 27
Target price: Rs 34
( HOLD)
Essel Propack
Current market price: Rs 116
Target price: Rs 175
(MAKE HIGH 127, 31 MARCH 15)
Tata Motors
Current market price: Rs 548
Target price: Rs 690
(MAKE HIGH 566 ,1 APRIL 15)
Power Grid Corp of India
Current market price: Rs 147
Target price: Rs 174
(HOLD)
..............................................................................
* BUY EXCIDE IND 11 MARCH 2015
CMP :- 183
TGT :- 200 + 210
TGT DONE 200, 13 MARCH 2015
* BUY DLF
CMP :-145
TGT :-165 170
TGT DONE 165, 16 MARCH 2015
.............................................................................................................
BUY ******* INTERNATIONAL LTD. ( Only for clients. )
CMP - 81 ITS MIRZA INTERNATIONAL
TGT - 110
SL - 74
( HOLD ONLY 15 DAYS )
( RECO. DT. - 27 MARCH 2015 )
TGT DONE
******************************************
BUY *******AUTO LTD. ITS JAMNA AUTO....JAI.... HO.
CMP - 193
TGT - 250
SL - 180
( HOLD 10 TO 15 DAYS )
(Recommend Dt 12 feb 2015) ( MADE A HIGH OF 234 )
**********************************************
BUY ?????? PIPES LTD. ( only for paid clients. ) ITS SRIPIPES......JAI HO.
CMP - 115.45
TGT - 140 TO 150
SL - 98
( HOLD FOR ONE WEEK )
( recommend dt 11 feb 2015 )( TGT DONE 140 )
******************************************
BUY ???????
( Only For Paid Clients. )
CMP - 394.60
TGT - 440
SL - 380
( HOLD FOR 5 DAYS )
(Recommed on 5 jan 2015)
TGT DONE
********************************************
BUY ?????????? FINANCE CORP. LTD.
(only for paid clients. )
CMP - 87.50
TGT - 110
SL - 70
( HOLD FOR 15 DAYS )
( Recommed Date 2 Jan 2015 )
( IT MADE A HIGH OF 95. WE EXIT THIS SCRIPTS )
********************************************
SHORT TERM CALL - 20 JULY 2015
BUY ORBIT EXPORT ( BSE CODE - 512626 )
CMP - 475.90
TGT - 620
HOLD 6 TO 7 MONTH
Key points
No comments:
Post a Comment