Category: Personal Finance

1. Ashoka Buildcon:

The firm from the real estate space has been retained with a ‘Buy’ call while the target price has been increased from the earlier Rs. 168 to Rs. 175. Last the stock traded at a price of Rs. 107.60, suggesting an upside of as much as 63% from the last retailing price.

Ashoka Buildcon is majorly into highway development in India. Further it is an integrated player in the area of EPC ,BOT & HAM and comprises a portfolio of 39 PPP projects. This is the largest with any private player in the country.

“Ashoka Buildcon (ASBL) reported 4QFY21 revenue/EBITDA/APAT at INR 14/2/1.5bn, beating our estimates by 14/32/43% on execution and margin outperformance. Labour efficiency has recovered to 90-95% after hitting a trough at 70% in April-21. The company expects commodity price impact to be minimal, given the escalation clauses in much of the order book”, added the brokerage report.

Key triggers

– Margin outperformance with EBITDA coming in at INR 2bn (+56/+91% YoY/QoQ, 32% beat)

– Order book at INR 81.7bn; INR 60-70bn inflow guidance for FY22. Company is on the hunt for international ventures as well.

– Consolidated gross/net debt stood at INR 62/54bn (Rs 60/55bn QoQ)

2. Somany Ceramics:

The tile company has given a ‘Buy’ recommendation by HDFC Securities for a target price of Rs. 940. Price as at the time of stock recommendation (July 14) was Rs. 664 and now at the close of July 16, 2021, the scrip settled close to its 52-week high price at Rs. 673.6. This implies an upside of 39.5% from the last traded price.

Somany Ceramics is India’s second-largest tiles player. We like it for its increased focus on retail sales through a robust distribution and showroom network across India and expanding share of premium tiles sales, said the brokerage report.

While demand pangs hit the industry growth from FY17- 21, the recovery in real estate Q3FY21 onwards and continued export growth are expected to bolster the industry’s and SOMC’s revenue growth.

“We value SOMC at 13x (five-year mean multiple) its Jun’23E consolidated EBITDA, leading to a target price of INR 940/share. We initiate coverage on SOMC with a BUY rating”, said HDFC Securities.

Disclaimer:

Stock market investments are risky. Please do your own analysis considering your risk profile and financial goals before betting on any investment product. Greynium, neither the brokerage nor the author will be responsible for any losses made on any investment call taken basis the above report. The above report is taken from HDFC Securities.

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Axis Bluechip Fund

This fund has been rated as “5-star” not only by Morningstar but also by Value Research. We believe that this fund been rated so, because of its strong performance and also because of its solid portfolio. Axis Bluechip Fund has delivered returns of about 43.68% in 1-year, while the 3-year returns has been 14.82% on an annualized basis and the 5-year returns has been 16.20%.

The fund was established way back in 2010 and has consistently delivered returns and has also managed to garner significant amounts over the years and now has assets under management of more than Rs 28,000 crores.

If you have a small sum of just Rs 500, you can start an SIP making it very much affordable to all investors. The portfolio of the fund comprises names like Infosys, HDFC Bank, Bajaj Finance, TCS etc. We recommend investors to start an SIP for at least 5-years, which would be the ideal way to create a decent corpus.

Canara Robeco Emerging Equities Fund

Unlike Axis Bluechip Fund, the Canara Robeco Emerging Equities Fund invests in stocks across a diversified portfolio of large and mid-cap stocks. This means the fund manager has the flexibility to quickly switch from midcaps to largecaps and vice versa, if he feels the need to do so.

You can start your SIP in Canara Robeco Emerging Equities Fund with a sum of Rs 1,000 every month. The assets under management of Canara Robeco Emerging Equities Fund is almost Rs 9,633 crores.

If you had started an SIP about 3 years ago, with a sum of Rs 10,000 you would have created a corpus of Rs 5.48 lakhs against an investment of Rs 3.6 lakhs back. We are in no way advocating that you are always going to get these kind of returns. The stock markets are uncertain and we also seen the kind of havoc that was created last year. So, one needs to invest in SIPs and at the same time diversify the holdings to include gold and debt as well.

Invesco India Infrastructure Fund

Invesco India Infrastructure Fund has been rated 5-star by Value Research and Morningstar. The fund tries to generate capital appreciation by investing in stocks that is predominantly constituted of equity and equity related instruments of infrastructure companies.

So, we wish to inform investors, that this means the fund to a large extent depends on how the economy pans out and the government and private sector’s push on infrastructure growth in the coming years. The fund has holdings in stocks like L&T, Indraprastha Gas, Ultratech Cement, Bharat Electronics, KNR Constructions etc. This fund is very small in size and has assets under management of only Rs 179 crores. Sn SIP can be started with a small sum of Rs 1,000. Go for SIP of Invesco India Infrastructure Fund if you are bullish on the infrastructure space.

Nippon India Short Term Fund

We have chosen one debt fund now for SIP, so you can diversify your portfolio. Nippon India Short Term Fund seeks to generate stable returns for investors with a short term investment horizon by investing in debt and money market instruments.

So, the returns may not be great because of complete exposure to debt, but, the risk too would not be great. So, Nippon India Short Term Fund is meant for those who want to protect their capital. This is another fund that has been rated as 5-star by Morningstar. The returns from the fund has been excess of 8% in the 3-year period.

Disclaimer

Investing in mutual funds is risky and investors need to be cautious. Neither Greynium Information Technologies nor the author would be responsible for any losses incurred based on decisions made from the article. Investors are also advised caution as the markets have closed at an historic high.

Jubilant Pharmova

The company is an integrated global pharmaceuticals company having three business segments Pharmaceuticals, Contract Research and Development Services and Proprietary Novel Drugs.

Motilal Oswal Institutional Equities sees a solid upside of almost 30% on the stock of Jubilant Pharmova and has recommended a “buy” on the stock with a price target of Rs 920, against the current market price of Rs 713.

It maybe recalled that the USFDA recently issued an Import Alert at Jubilant Pharmova Roorkee facility, escalating the regulatory concerns at the site. However, Motilal Oswal believes that the company would have minimal impact given that the USFDA has granted exemption to certain products from the Import Alert list, subject to Jubilant Pharmova meeting some conditions.

“We have tweaked our estimates for FY22/FY23E to reflect the impact of the import alert at the Roorkee plant. We expect an 11% CAGR in Radiopharma sales and 8% CAGR in CDMO (adjusted for one-time sales of COVID products in FY21) over FY21-23. Thus, we expect a 10% earnings CAGR over FY21-23. We maintain BUY on the stock, with a target price of Rs 920 (valued at 9x 12M forward EV/EBITDA),” the brokerage has said.

Shares of Jubilant Pharmova last closed at Rs 713.30 on the NSE.

Coromandel International

Broking firm, Motilal Oswal also has a buy call on the stock of Coromandel International with a 19% upside on the stock for a target of Rs 1040, against the current market price of Rs 864. The company is India’s second largest Phosphatic fertilizer player, is in the business segments of Fertilisers, Specialty Nutrients etc.

Coromandel International’s key markets are Maharashtra, Telangana, Karnataka, West Bengal, and Odisha and Andhra Pradesh. According to the brokerage the structural story of the company remains intact with regard to increasing awareness among farmers about having balanced nutrients in crops. According to the firm focus to reduce cost of raw materials, launch of 3-4 molecules in the Crop Protection segment, inorganic growth, and focus on profitable growth in the Retail business by reorganizing stores depending on consumption pattern are some of the reasons to buy the stock of Coromandel International.

“We expect a revenue/EBITDA/PAT CAGR of 9%/9%/12% over FY21-23E. We value Coromandel International at 18x FY23E EPS to arrive at our target price of Rs 1,040. We maintain our Buy rating on the stock of Coromandel International,” the brokerage has said.

Cyient

Motilal Oswal has set a 15% upside target on the stock of Cyient as the brokerage sees increasing spends in the ER&D industry and Cyient’s strategy to digest these spends as a supporting factor in the near-to-medium term.

Cyient is engaged with customers across their value chain helping to design, build, operate, and maintain the products and services that make them leaders and respected brands in their industries and markets.

Cyient 1QFY22 revenue de-grew 4% QoQ in USD terms (in line with our estimate). This was led by 20% QoQ decline in the DLM business.

“We raise our estimates on better potential margin performance as the management increases its intake of freshers as well as benefits from operating leverage. We maintain our Buy rating on attractive valuations. Our target multiple of 20x FY23E EPS takes our target price of Rs 1,090/share, implying an upside of 15%,” the brokerage has said.

TCI Express

TCI Express has emerged as one of the leading Indian B2B, surface logistics and express logistics solution providers. The company caters to the five increasingly growing areas across sectors including automotive, pharmaceutical, textiles, engineering, IT hardware and electronics.

The company’s offerings include cold chain express for pharma sector , air express division, customer to customer (C2C) express logistics. The company despite the rising competition has been left unscathed owing to its continuing focus on building its strength in the B2B segment by expansive delivery, focus on SME and MSME, investments into building IT infra etc.

Technicals:

The logistic space has seen strong buying demand in the last one year with most stocks breaking above their long term supply area. TCI Express has been an outperformer within the logistic space maintaining higher peak and higher trough in all time frames. It is currently on the cusp of generating a bullish Flag breakout signalling continuance of the primary up trend and offers fresh entry opportunity. We expect the stock to trade with a positive bias and head towards Rs. 1775 levels as it is the 161.8% external retracement of its last five weeks breather (Rs. 1624-1388).

The stock earlier during May 2021 registered a resolute breakout above a rising supply line joining the highs of CY18 (Rs. 739) and CY20 (| 949) signalling a structural turnaround. It has already taken five weeks to retrace just 38.2% of its preceding four week’s rally (| 940-1624). A shallow retracement highlights a higher base formation and a robust price structure.

Financials:

TCI Express continued to post QoQ recovery in profitability in FY21 (EBITDA margin expansion by 410 bps), in spite of lower operating leverage (volumes down 17% in FY21), as the management employed cost control measures, realisation hikes, passage of crude oil price rise to most of the customers and continued to pick only profitable sales, said the brokerage report.

The management expects the expansion in EBITDA margins to continue from hereon (100 bps each year), aided mainly by volume growth, as it expects the SME sector to bounce back, as the state-wide restrictions due to pandemic subsides, added the research report.

Disclaimer:

Stock market investments are risky. Please do your analysis considering your risk profile and financial goals before betting on any investment product. Greynium, neither the brokerage nor the author will be responsible for any losses made on any investment call taken basis the above report. The above report is taken from ICICI Direct.

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