Month: June 2021

1. TCNS Clothing:

The apparel company catering to the women section owns popular brands such as Aurelia, W, Wishful etc. The company made its stock market debut on July 30, 2018 and listed at a price of Rs. 715 per share on the BSE. Currently, the stock trades at a discount to its listing price at Rs. 544 and commands a m-cap of Rs. 3,346 crore. In May, Axis Mutual Fund increased its holding in the scrip of TCNS. In the December quarter, the company posted PAT at Rs. 12.66 crore after 3-consecutive quarters of losses.

In the year period, the stock has underperformed Sensex with return of 44% as against Sensex 1-year return of 56%.

2. Magma Fincorp:

The 1-year return from this leasing and hire purchase financing major is 612 percent as against Sensex absolute return of 56% during the same time. In May Aditya Birla Sunlife AMC bought stake in the company worth Rs. 73 crore. On June 17, 2021, the stock settled at a price of Rs. 153.4 per share on the NSE. ICICI Securities has a ‘Buy’ recommendation on the scrip with a price target of Rs. 173.

3. Butterfly Gandhimathi Appliances:

The domestic appliance company is into manufacturing of home appliances, cookware and kitchen products. Established in 1986, the company is a pioneer in stainless steel products. In the last one-year the scrip is up 524 percent and has outperformed the Nifty Small cap 100 index. M-cap of the scrip after the closing of trading session on June 17 is Rs. 1,307 crore. The stock has been added by DSP BlackRock.

4. EID Parrry (India) Ltd:

As it is the prospects of sugar companies have sweetened with the centre now advancing the ethanol blending programme. This small cap sugar stock has been picked by Quant Money Managers and Sundaram AMC. Over a 1-year period, the stock has provided a return of 81 percent, while YTD return of the stock is 24%.

5. Poly Medicure:

This hospital and medical services scrip last closed at a price of Rs. 891.4 per share on the NSE. M-cap of the scrip is Rs.8546 crore. As against the industry P/E of 22.39, the scrip commands a P/E of 66.56 and has zoomed 195% in the last one year. UTI AMC bought stake in the company in the March quarter.

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LIC Housing Finance

Emkay Global has placed a “hold” call on the stock of LIC Housing. The firm does not see an upside potential on the stock. In fact, the target price is Rs 470, which is a fall from the current market price of Rs 485.

“We have incorporated preferential allotment of 45.4 million shares to the promoter (LIC). However, we expect further need of capital considering the demand environment and elevated NPAs. Maintain Hold/EW in EAP with a revised target of Rs 470 (Rs 432 previously), corresponding to 1.2 times FY23E P/Adj. Book (1x FY23E book earlier),” the brokerage has said.

The stock of LIC Housing has seen a sharp up tick in the last few months and is closer to its 52-week highs and investors may well resort to sell on a rally.

L&T Infotech

Emkay Global is not bullish on the stock of L&T Infotech and has recommended a sell on the stock of the IT company.

“Cuelogic will be integrated with LTI’s Digital practice, which is a focus area for LTI. The acquisition will augment its domain capabilities. Given the size of the acquisition (

The lower target price of Rs 3,550 is significantly lower than the current price of Rs 4126 on the stock,” the brokerage firm has said. The stock of L&T Infotech like those from the IT space have rallied significantly in the last few months.

KEC International

Emkay Global has suggested buying the stock of KEC International with a price target of Rs 475 on the stock, as against the current market price of Rs 406. This is an upside of almost 155 from current levels.

“We marginally raise FY23/24E EPS by 3-4% on better execution guidance in the Civil business (14% of FY22E sales) and arrive at a revised price target of Rs 475 (Rs 460 earlier), based on 15 times FY23E EPS (its long-term average PE multiple). We expect FY21-FY24E EPS CAGR of 18%, led by partial margin rebound over the period,” the brokerage has said.

Disclaimer

All of the above stocks are picked from the report of Emkay Global. Investing in stocks are risky and investors should do their own research. The author, the brokerage firm or Greynium Information Technologies is not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise due caution as markets have run-up significantly.

Contribution towards EPF

An employer contribution to an EPF account is taxable with effect from April 1, 2020, if they surpass Rs 7.5 lakh in a fiscal year. According to a new rule unveiled in Budget 2020, if an employer’s overall contribution to the National Pension System (NPS), superannuation fund, and EPF account of an employee surpasses Rs 7.5 lakh in a fiscal year, the surplus contribution becomes subject to taxation in the hands of the employee and is represented in Form 16 of that employee. If you are an employee that doesn’t have an NPS account or do not have exposure to a superannuation fund, and your employer’s contribution to your EPF account, on the other hand, is Rs 8 lakh in a fiscal year, in this instance also the surplus amount will be taxable in your hand.

Interest earned on EPF account

According to the EEE status of EPF, the interest earned on the EPF account is also tax-free as well, but there are instances when the interest earned becomes taxable. In force from April 1, 2021, if an employee’s contribution to the EPF account, together with surplus contributions through the Voluntary Provident Fund (VPF), surpasses Rs 2.5 lakh in a fiscal year, the interest received on surplus contributions will be taxable to him or her. That being said, the employee’s sole contribution up to Rs 5 lakh in a fiscal year is tax-exempt, if no employer contribution is made to the EPF account of that employee. In some situations, there is an unwithdrawn amount in dormant EPF accounts. In this situation, the EPF account maintains to generate interest on the EPF contributions, and the interest received on deposits in inactive EPF accounts is subject to taxation to the responsible employee.

Withdrawal from EPF account

If a withdrawal is made by an employee from the EPF account upon maturity, or if a partial withdrawal is undertaken, the withdrawal is tax-free. Even if a withdrawal is made from the EPF account as a COVID advance to cope with a crisis, the withdrawn amount will not be taxable in the hands of the responsible employee. If an employee leaves his or her employment and does not find another employer within two months, he or she is entitled to make a complete withdrawal from the EPF account. Considering this instance, the taxation of the withdrawal amount from the EPF account will be determined by the duration of the active period of the EPF account. Such as, the withdrawal is tax-free if it is made from the EPF account after 5 years of continuous service or employment. This means that if you have less than 5-years of continuous service, then the withdrawn amount (if any) will be subject to taxation in the hands of the responsible employee. Furthermore, in case the withdrawal amount surpasses Rs 50,000, TDS at the rate of 10% would be levied. Please note that TDS on EPF withdrawals is levied on amounts higher than Rs 50,000 withdrawn before the expiration of 5 years of employment or continuous service.