Category: Personal Finance

So what lies for the yellow metal ahead- Will it shine or lose its sheen further?

For now gold prices even while being supported by raging delta variant cases has got a support, the likelihood and Fed hints of tapering instance has lent support to dollar or the greenback that has weighed on the yellow metal gold.

This month we even saw gold diving to levels of even below $1700 levels on the better than expected non-farm payrolls data which pushed the demand for the safe haven and hence gold prices suffered.

Analysts for now have a divided view on gold while UBS’ advices investors to square off their position in the metal considering further slide below $1700, other analysts including the likes of Goldman Sachs has seen to it again inch above $2000 per ounce, by the year end of 2021.

Factors that can be positive for gold

1. Delta variant cases continue to be seeing restrictions and is even said to be most responsible for cases in India:

China is seeing a rise in the delta variant cases and hence restrictions are being triggered and this may ramp-up risk-off sentiment and hence ‘safe haven’ appeal may see an increase.

2. Correction in equities can be good for gold:

Equities globally saw overwhelming gains and are at record highs, but any tapering sooner or later will trigger or has a potential to trigger a steep correction and hence we may see risk-off sentiment developing among investors, driving them to safe haven gold and hence boosting the latter’s price.

Factors that will fuel downside in gold

1. Oil prices continue to decline internationally:

Coronavirus situation has also weighed on the demand recovery of the commodity and apart from it the latest stock piles is also pulling down the price of crude internationally. Now as both are explored from the earth, there is limited amount availability and further as both the commodities are priced in dollar, the 2 share a direct relationship, i.e. when the oil prices, there is also seen a gold price fall.

2. Gaining dollar:

Of late after the latest Fed minutes of a possible tapering sooner, dollar or the greenback has being on the upward trend. As at the time of writing this copy, the dollar index- last as on August 23,2021 12:22 am EDT quotes with a decline of 0.19% at 93.32.

This is even as the dollar for last few sessions was trading over 9 month high, nonetheless, there has been seen gains in the dollar yield which is up by 0.8% at 1.270. Gains in the US benchmark yield also cast a negative for the gold.

Should you buy gold considering possible downsides?

Even before the Fed hinted of a possible tapering gold experts suggested that gold will continue to decline for some more time before moving upwards, there is always a benefit out there with gold investment which has the potential to yield multibagger returns in a decade and also helps an investor to diversify as well as hedge one’s portfolio against inflation. So, with gold investments you may never go wrong, but the key is to buy in a staggered way which can average out the cost and maintain 10-15% of your funds in gold asset class.

Disclaimer:

Readers be mindful we are just highlighting the prospects of gold going ahead and this is never an investment advice to buy into gold. You need to always check your profile before betting on any investment product for that matter.

GoodReturns.in

1) Vyapar GST

Vyapar is a simple, free GST accounting program that also helps with invoicing and billing. The GST-compliant software is designed for small and medium-sized businesses and is primarily used for automated tax computations, invoice production, POS machine management, and financial report generation.

2) Zoho GST Invoice Software

The free edition of Zoho GST billing software is a professional tool for filing invoices and automatically creating payment reminders.

Small and medium businesses can also use this GST invoice software to take card payments and design invoices to match their brand image. It’s also one of India’s best free billing programs. This enables businesses to send clients automated payment reminders. You can produce invoices, make faster payments, and manage projects using Zoho.

3) Clear tax GST

For free GST billing, return filing, and inventory management, ClearTax is one of the top GST billing software options. It also aids in the creation of customized invoices with the logo of the specific company.

It’s a full GST filing software package with up-to-date upgrades to ensure that the tax deducted while billing is consistent. ClearTax is simple to use and adheres to the most recent government GST laws. For Indian taxpayers, ClearTax acts as a financial hub. The company’s objective is to help tens of thousands of Indian enterprises, businesspeople, and others streamline their accounts and save money and time.

4) MARG GST Software

Marg GST software provides a full GST solution, from billing to filing returns. Even if users lack in-depth accounting knowledge, this software allows them to make entire invoices in GST format and handle all of their money. MARG Billing is one of the best GST invoicing software programs available, with all of the capabilities needed to run a small business or a franchise. It’s one of the top GST software options on the market, with modules for retail, ERP, manufacturing, distribution, payroll, and accounting.

5) Tally.ERP 9

Tally ERP 9 is accounting software that helps companies manage their finances. It can keep track of multiple businesses in a single file. And, depending on the service, provide a multi-billing model. It also oversees the business’s financial flow by keeping track of payables and receivables. For Indian enterprises, Tally.ERP 9 is one of the top GST software options. To deliver correct invoices, it conforms to all of the government’s GST-related compliances.

It also assists with other modules such as accounting, inventory, banking, and payroll. Tally. ERP 9 is appropriate for both SMEs and large corporations.

6) Sleek Bill

One of the top GST billing software in India is Sleek Bill. It’s a useful billing program that generates invoices. This tool was created specifically for the Indian market. You may create and design invoices using the user-friendly interface. It also has GST integrations and extensive billing features.

Sleek Bill is one of the most accurate and fast invoicing and billing software for SMEs, with all of the capabilities they need. With the free GST billing software, you can easily complete both offline and online accounting/billing chores. As a result, you are free to utilize the program to calculate GST, manage taxes, and create invoices.

7) SAG Infotech- Gen GST

SAG Infotech Private Limited’s Gen GST software is a comprehensive GST solution built and developed for both desktop and web use. The software allows you to fill out infinite returns for an unlimited number of clients.

Anyone can download Gen GST for free, or they can use the GST SaaS service to work on a cloud-based platform that is accessible from anywhere and gives support for GST billing, e-filing, and E-way bill purposes to small enterprises and other persons in India without any problems. It assists businesses with a variety of tasks, including generating and maintaining bills and invoices, filing reports, managing ledgers, and creating GST e-way bills.

8) ProfitBooks GST

In India, ProfitBooks is a popular GST accounting software. It’s an easy-to-use accounting program designed for developing enterprises. This platform has been able to attract a number of firms. SMEs use ProfitBooks GST accounting software to track their spending, manage their inventory, and much more. ProfitBooks allows you to create clear, informative invoices and accept payments via internet payment gateways. ProfitBooks allows you to make invoices, maintain inventory, and manage taxes, among other things. With time, this tool has improved and currently includes a number of GST-compliant functions.

Note: Make sure to check the website before making any decision.

Buy Maruti Suzuki for profits of up to 20%

Motilal Oswal has recommended buying Maruti Suzuki shares at the present market price of Rs 6,848 with an upside target of Rs 8,200.

The brokerage says that while underlying demand is solid, the near-term picture is uncertain, due to semiconductor shortages and the lingering effects of commodity cost inflation, which are reflected in 2QFY22. We expect new product launches to restart after a two-year hiatus, with a combination of total product upgrades and new model launches. This should result in increased volume, market share, and a return to profitability. Profitability is nearing a nadir, and margins are likely to rise from 1HFY22’s lows.

Strategy for net-zero emissions needs to be India focused

“We see scope for further improvement in dividend payouts and a resultant rerating. The stock trades at 36.4x/22.5x FY22E/FY23E consolidated EPS. We value the company at 27x Mar’23E consolidated EPS. We maintain our Buy rating, with a TP of INR8,200/share,” the brokerage has said.

Buy State Bank of India for profits of up to 47%

Motilal Oswal has recommended buying SBI shares at the present market price of Rs 407 with an upside target of Rs 600.

According to Motilal Oswal, before the worst period of the corporate cycle impacted earnings, SBIN had consistently provided above 15% RoE for ten years, to the point where the bank posted back-to-back losses in FY17/FY18. In a difficult climate, it recorded a solid FY21/1QFY22 performance. Deposit growth remained strong, owing to positive CASA trends, but loan growth is expected to slow over FY22-23E. The outlook for asset quality is very promising. The management has increased the PCR to 68%. Continued profit growth would be bolstered by continued recovery.

Asset quality performance resilient in 1QFY22, despite the second COVID wave

“SBIN holds unutilized COVIDrelated provisions of ~INR91b, which should limit credit cost. SBIN has reported a RoE of ~9.5% in FY21 – the highest since AQR started in FY16 and is now aiming to reclaim 15% RoE in the medium term. We project a RoA/RoE of 0.8%/14.6% by FY23E, and reiterate SBIN as our top BUY with a TP of INR600/share (1.4x FY23E ABV + INR190/share from subsidiaries),” the brokerage has said.

Despite a difficult first quarter of FY22 due to the second COVID wave, the bank showed resilience, with fresh slippages of INR156.7 billion (annualised slippage ratio of 2.6 percent, which was lower than many private rivals).

Despite the fact that slippages were somewhat higher in July, led by the Retail/SME portfolio, management emphasised that a slippage worth INR48 billion had already been recovered/upgraded.

Disclaimer

The article is informational in nature, which is taken from the brokerage report of Motilal Oswal institutional Equities. Please do consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in the article.

Templeton India Equity Income Fund

An open-end diversified equity fund that invests primarily in stocks with a current or potentially attractive dividend yield in order to deliver a combination of regular income and long-term capital appreciation.

Franklin Templeton Mutual Fund’s India Equity Income Fund-Growth is a Thematic-Dividend Yield mutual fund plan. The Templeton India Equity Income Fund-Growth manages assets of 1,148 crores (AUM). The fund has a 2.3 percent cost ratio, which is more than most other Thematic-Dividend Yield funds.

Templeton India Equity Income Fund has a 1-year growth rate of 60.57 percent. It has returned an average of 14.05 percent per year since its inception.

The Energy, Technology, Construction, FMCG, and Automobile sectors account for the majority of the fund’s assets. Infosys Ltd., Power Grid Corpn. Of India Ltd., Embassy Office Parks REIT, Brookfield India Real Estate Trust REIT, and Tata Power Co. Ltd. are the fund’s top five holdings.

UTI Dividend Yield Fund

UTI Dividend Yield Fund Regular Plan-Growth is a UTI Mutual Fund Thematic-Dividend Yield mutual fund plan. The assets under management (AUM) of UTI Dividend Yield Fund Regular Plan-Growth is 3,028 crores. The fund has a 2.21 percent cost ratio, which is more than most other Thematic-Dividend Yield funds.UTI Dividend Yield Fund Regular Plan-Growth gains are 50.59 percent over the last year. It has generated an average yearly return of 15.29% since its inception.

The majority of the money in the fund is invested in the Technology, FMCG, Energy, Financial, and Metals sectors. In comparison to other funds in the category, it has less exposure to the Technology and FMCG industries.

The fund is invested in Indian stocks to the tune of 99.45%, with 63.72 percent in large cap stocks, 22.56 percent in mid cap stocks, and 11.89 percent in small cap stocks.

Principal Dividend Yield Fund

The Principal Dividend Yield Fund – Direct Plan will be subject to an Exit Load. For units worth more than 24% of the investment, a 1% redemption fee will be paid if redeemed within 365 days.

A minimum investment of Rs 5000 is required, with an extra investment of Rs 1000. SIP investments start at Rs 500.

Principal Dividend Yield Fund Direct-Growth is a Principal Mutual Fund Thematic-Dividend Yield mutual fund plan. Principal Dividend Yield Fund Direct-Growth had 224 Crores in assets under management (AUM) and is a modest fund in its category. The fund has a 2.1 percent cost ratio, which is more than most other Thematic-Dividend Yield funds.

The returns on the Principal Dividend Yield Fund Direct-Growth Fund over the last year have been 50.27 percent. It has had an average yearly return of 14.53 percent since its inception.

Who Should Invest in Dividend Yield Funds?

These funds are compared to the Nifty Dividend Opportunities 50 Index, which monitors high-yielding firms. These funds have a large-cap bias, despite the fact that they can invest across market capitalization and industries. The majority of these funds have put at least half of their net assets into large-cap companies. Dividend Yield Funds invest in established, healthy cash flow businesses that are less volatile and capital-intensive, such as utilities and mining.

Investors seeking for a consistent stream of income could choose a dividend yield fund. Although the dividends paid by this type of mutual fund aren’t particularly high, some income is better than none. However, as previously stated, dividend payments are not guaranteed and are totally dependent on the performance of the underlying company as well as market movements.

Tax Advantage

Mutual funds are exempt from paying taxes on dividends received from investee firms. Dividends paid by mutual funds are now taxed in the hands of investors according to their income tax bracket. The capital gains tax rate offered by these funds varies depending on the holding term and kind of equity exposure.

The dividend will be taxable exclusively in the hands of investors beginning April 1, 2020.

On dividend income distributed to residents, mutual funds deduct 10% and 20% Tax Deduction at Source (TDS), respectively. If the dividend income exceeds Rs 5,000, this is applicable. As a result, growth plans are recommended for investors.

Disclaimer

The views and investment tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advise to buy or sell stocks, gold, currency or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor.

Emkay Global Financial

In its research report dated August 06, 2021, Emkay Global Financial suggested a buy rating on Ultratech Cement with a target price of Rs 8500.

“We have a Buy rating on the stock with a DCF-based TP of Rs8,500 (Sep’22E), implying a 15x forward EV/EBITDA (vs. current multiple of 16x).

According to the brokerage, Ultratech identified the following important pillars of its growth strategy:

1) increase balance sheet strength and return ratios

2) focus on cost optimization and efficiency gains

3) low-cost expansion, mostly through brownfield expansion.

“We predict that increasing the share of green electricity, improving the blended ratio, lowering the lead distance, and boosting operating leverage will result in sustainable cost reductions of Rs90-100/ton by FY24E,” the brokerage added.

ICICI Direct

In its research report dated July 23, 2021, ICICI Direct suggested a buy rating on UltraTech Cement with a target price of Rs 8700.

Outlook

“With a target to become net debt free by FY23E and expected RoCE of 17%+, we remain positive on company. Hence, we maintain BUY rating We value UltraTech at Rs 8,700 i.e. 17x FY23E EV/EBITDA ,” the brokerage said.

UltraTech is India’s largest cement manufacturer, with domestic capacity of 111.4 MT and market supremacy in most regions. In the previous three years, it has increased roughly 30 MT of capacity through organic and inorganic ways. It has demonstrated its capacity to successfully integrate acquired assets and ramp up usage in a profitable manner. The corporation is now concentrating on the fast-growing market of eastern India, which accounts for 10.2 million tonnes of the total 19.6 million tonnes of expansion projected for FY21-23E.

Sharekhan

Sharekhan advised a buy rating for UltraTech Cement, with a target price of Rs 8800.

Outlook

“We maintain a Buy rating on UltraTech Cement (UltraTech) with a revised PT of Rs. 8,800, factoring upwardly revised estimates led by sustained healthy demand environment over FY2022-FY2024.” the brokerage has said.

UltraTech continued to surprise pleasantly on the operating front in Q1FY2022, boosted by solid volume growth, which was visible despite the COVID-19 impact in Q1FY2022, a rise in cement prices, and lower operating expenses. In the first quarter, net debt continued to decline. In addition, a significant debt was paid off in July 2021. The plans to turn net cash in FY2024 and add 19.5MTPA by FY2023 are still on track. Demand for rural and urban real estate, as well as significant infrastructure projects, is projected to stay strong.

Motilal Oswal

Motilal Oswal suggested a buy rating on UltraTech Cement with a target price of Rs 8770.

Outlook

“The valuation is reasonable at 13.7x FY23E EV/EBITDA – a 10% discount to its last five years’ average. We value UTCEM at 16x FY23E EV/EBITDA to arrive at TP of INR8,770. Reiterate Buy,” the brikerage has said.

In 1QFY22, UltraTech Cement (UTCEM) continues to increase its costs and margins, reporting the highest EBITDA/unit of INR1,536/t (+8% YoY) in the company’s history. This, combined with a 47 percent YoY increase in volume, resulted in a 59 percent YoY increase in EBITDA. QoQ, net debt dropped by INR7 billion to INR59.8 billion (0.44x TTM EBITDA). The continuing 20mtpa growth program, which is expected to deliver a 13 percent volume CAGR over FY21-24E, should help maintain market share gains. We enhance our EPS forecast for FY22E/FY23E by 6%/6%, based on a higher realisation expectation. Over FY21-23E, we anticipate a 26 percent EPS CAGR.

This Cement Stock Is Most Recommended By Brokerages

Disclaimer

The article is informational in nature, which is taken from the various brokerage reports. Please do consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in the article.