Month: July 2021

1. Steel Authority of India:

ICICI Securities has placed a ‘Buy’ call on the scrip of Steel Authority of India at a price of Rs. 130 ( the price at the time of recommendation). The brokerage sees the target for the scrip at Rs. 160 i.e. an upside of over 28% from the last traded price of Rs. 124.8.

“SAIL has adopted a focused approach on improving its volume, improving its operational efficiencies, operating the facilities at optimum levels, deleveraging its balance-sheet, etc.

In line with its focus on reducing the borrowings. SAIL has reduced its net debt by Rs. 16200 crore in FY21. Going forward also, we expect SAIL’s net debt to further reduce by Rs. 6800 crore, over the next couple of years. We model sales volume of 17 MT for FY22E and 19 MT for FY23E. We value the stock at 5.5x FY23E EV/EBITDA and arrive at a target price of Rs. 160 (earlier Rs. 130). We maintain our BUY recommendation on the stock”, said the brokerage firm in its report.

SAIL has been among the top companies which have reduced debt substantially by as much as Rs. 18,551 crore in the FY 2020-21 and this has been aided by increase in steel prices.

The scrip of SAIL last traded at a price of Rs. 126 per share on the NSE.

2. ONGC:

Geojit Paribas has given a 20.88% upside for the stock of ONGC i.e. a key oil drilling and exploration company of India. The target price seen for the scrip is Rs. 145 and at the time of stock recommendation, the stock quoted at a price of Rs. 118.45.

Rationale for the Buy on ONGC as suggested by Geojit Paribas:

With sharp recovery in crude oil prices in FY21, we expect the segment to witness further growth in coming quarters. Upward revision in Gas prices and any improvement in demand scenario should boost the performance further. Therefore, we reiterate our BUY rating on the stock with a revised TP of Rs. 145 based on SOTP valuation, said the brokerage in its report dated June 29, 2021.

“Considering the full recovery in crude volumes and realization, ONGC’s topline performance now largely depends on movement in gas prices and its offtake. Revenue growth from Natural gas and Value-Added products is expected to improve as the impact from partial lockdowns mitigates. Also, possible hike in natural gas prices could drive the performance further”, added the brokerage.

Financials:

The company’s standalone revenue registered a decline of 1.2 percent YoY to Rs. 21,189 crore owing to lower realization as well as weak demand. Nonetheless, EBITDA improved owing to lowering of material costs as well as other expenses. PAT also registered a 144.6% YoY increase.

3. Balaji Amines:

CD Equisearch has given a Buy recommendation for this specialty chemicals company scrip of Balaji Amines At the time of recommendation, the price of the scrip was at Rs. 2670.25, while the suggested upside is Rs. 3613, an upside of over 28%.

The company is a specialist in the manufacturing of Methylamines, Ethylamines, Derivatives of Specialty Chemicals and Pharma Excipients. Also the company is into manufacturing of derivatives that are downstream products for various Pharma /Pesticide industries apart from user specific requirements.

“The stock currently trades at 25.5x FY22e EPS of Rs. FY23e EPS of Rs. 105.4and 22.3 xFy 23e EPS of Rs. 120.44. ROE would improve to 32.7% in FY22 and 28% in FY23. Growth in the coming years would barely stymie not least due o planned debottlenecking of acetonitrile plant, increased capacity utilizations of both DMF and newly unveiled ethylamine plant. The strong demand for EDA shall also have a larger role to play. Better negotiating power and economies of scale arising out of future investments will improvise the company’s cost structure and provide it with necessary economic moat. Free cash flows would rise not unremarkably this fiscal largely due to record profits. we retain our buy rating on the stock with revise target of Rs 3613 (previous target: Rs 1104) based on 30x FY23 earnings”, said the brokerage report.

The scrip of Balaji Amines last quoted at a price of Rs. 2821.15.

Disclaimer:The stocks listed in the story are taken from different brokerage reports. Investing in stocks is risky and investors should do their own research. The author, the brokerage firm or Greynium Information Technologies Pvt Ltd is not responsible for any losses incurred due to a decision based on the above article.

GoodReturns.in

A subscriber can now withdraw 100 per cent of their accrued pension corpus under NPS without purchasing an annuity, according to the withdrawal and exit rule set by Pension Fund Regulatory And Development Authority (PFRDA). Subscribers of the National Pension System (NPS) can currently withdraw up to Rs 2 lakh from their accumulated corpus. Pensioners can withdraw 60% of their contributions after this threshold has been exceeded, and the remaining 40% of the corpus must be used to purchase annuities. Here are the latest guidelines issued by PFRDA for NPS withdrawal, under the National Pension System Amendment Regulations, 2021.

According to the PFRDA, “where the accumulated pension wealth in the Permanent Retirement Account of the subscriber is equal to or less than a sum of five lakh rupees, or a limit as specified by the Authority, the subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing annuity and upon such exercise of this option, the right of such subscriber to receive any pension or other amount under the National Pension System or from the government or employer, shall extinguish.”

The PFRDA Amendment Act further has clarified that “if the accumulated pension wealth of the subscriber is equal to or less than two lakh fifty thousand rupees or a limit to be specified by the Authority, such subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing any annuity and upon such exercise of this option the right of the subscriber to receive any pension or other amounts under the National Pension System shall extinguish and any such exercise of this option by the subscriber, before the notification of this provision, shall be deemed to have been made in accordance with this regulation.”

To withdraw NPS corpus at the time of death of the subscriber. The PFRDA Amendment Act has also stated that “if the accumulated pension wealth in the permanent retirement account of the subscriber at the time of his death is equal to or less than Five lakh rupees or a limit to be specified by the Authority, the nominee or legal heir(s) as the case may be, shall have the option to withdraw the entire accumulated pension wealth without requiring to purchase any annuity and upon such exercise of this option the right of the family members to receive any pension or other amounts under the National Pension System shall extinguish.”

For purchasing government-approved annuities, the PFRDA Amendment Act has also clarified that “where a subscriber attains the age of sixty years or superannuates in accordance with the service rules applicable to such subscriber, at least forty percent out of the accumulated pension wealth of such subscriber shall be mandatorily utilized for purchase of annuity providing for a monthly or any other periodical pension and the balance of the accumulated pension wealth, after such utilization, shall be paid to the subscriber in lump sum. In case, the accumulated pension wealth of the subscriber is equal to or less than a sum of five lakh rupees, the subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing any annuity.”