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Damani's view on stocks and sectors

Thursday, June 21, 2007

How are the markets looking? Ramesh Damani gives his views on stocks, sectors and investment strategies in a chat with investors.

Ramesh Damani chats with investors on Moneycontrol.com

Q. Would you agree with the statement that CRISIL is the Indian equivalent of Moody`s - a favourite of Warren Buffet. Great ROCE, great cash flow and high entry barriers. Doers it offer value at CMP Rs.3375?

Damani: Market buzz is that another open offer is coming to take it private.

Q. Is it a breakout today?

Damani: too early to tell

Q. How is the first consolidated results of VIP?

Damani: if you include one time write off back results were good.

Q. Dish TV is available near to its issue price. Is it going to benefit from the huge opportunity of CAS and DTH?

Damani: Yes, still in early stages but Dish TV will be a big opportunity. It is probably still early today.

Q. With long term capital gains tax (1 yrs) set at zero, Govt is giving strong signal to the pulic to invest in equities. Promoters have got the signal and are increasing their holding in their companies and values are being unlocked at the benefit of both the promoters and stock owners (Eg: Godrej industries, UB Group). Do you have any such plays in your radar which fall under high promoter holding, deep value and value unlocking driven by management?

Damani: A recent pick like TCI may be something in that nature.

Q. Your take on UB Holdings at the current valuations for a patient investor. Do you think it will prove to be a multi bagger even from here on?

Damani: Multi bagger might be hard from these levels.

Q. How will the merger help the TTML investors?

Damani: bigger footprint

Q. It is surprising that MC Dowell Holdings is still available at half the book value . However, there seems to be bit of lack of clarity in terms of Line of business (what all they hold ?) around this stock which is possibly the reason for stock not moving up rapidly - what do you say ?

Damani: The recent play is Shaw Wallace. McDowell Holding and UB Holdings will probably treat water.

Q. Is Titagarh a hold or accumulate?

Damani: Yes for now

Q. What are the prospects of Viseshinfo at current place? Can it be held as multi-bagger?

Damani: No way at the current time.

Q. What is it that influenced the most into buying a good amount of stake in GE CAP?

Damani: Seemed cheap good risk and reward.

Q. Any current management that you like strongly and reasons for the same?

Damani: Maybe next week will share a new magement that I met.

Q. Why GE with huge India plans is still available at Rs 200 cr market capital. Should it not be a no brainer?

Damani: The only point is how fast they scale up and the importance they give to this company.

Q. Is there any plan for sundaram finance to get demerged?

Damani: Not that I know about.

Q: Some expert said that we could be close to 20,000 in 2010. Do you share the same view? Also do you think this bull market could last till 2015?

Damani: I try to avoid big market calls and focus on stocks.

Q.: You have been bullish on the media sector for a long while. Have you been able to segregate the winners from the pack? What would be your three top long term bets in this sector?

Damani: Maybe some time else not ready yet to call the winners but the losers are becoming obvious.

Q: A.K.Jain of Berkshire Hathaway is said to be looking at Indian oil.

Damani: The Indian refinery and mkty sector is a great bargain.

Q: Do you think HALDYN GLASS at market cap of only Rs 30 crores and sales of Rs 60 crores can easily be a multibagger ?

Damani: looks okay. It is cheap. I buy and sell it but it is cheap.

Q. To everyone`s surprise the market has turned around today. You were saying in our earlier chats, odds are good for the sensex. Will the market roar again and will we see the previous highs of 14700 and then 15000 very shortly?

Damani: like I say focus on stocks not the markets.

Q. Please list out those 5-7 great stocks of 5% yield in this market.

Damani: Look at Balmer Lawrie, HPCL, VST, Banco Products, Ultra Marine Pigments. They may have already gone xd but u get the idea.

Q: Surya Roshini? With thrust on CFL by some State Govts and its market share next only to Philips, do you think the management is in a position to really cash in on the huge opportunity? If it so, could it be a multi-bagger. What is your view?

Damani: It is cheap but when it will move I can't say. But that is value investing.

Q. You seem confidant that Nucleus can tide over the problems that a strong rupee can pose. But you do not seem so sure of the big boys of IT.

Damani: it will be a challenge.

Q: You attributed the low mcap of SAMSONITE to its high debt and costs. Then do you think these problems are not for VIP, or they can be handled by the mgmt?

Damani: Growth should be strong.

Q: Is Divi's Labs still a hold still or should we get out of the stock now?

Damani: My friend who follow the co says it is going to do well so he is recommending hold on

Q: Your opinion regarding Hind Dorr Oliver?

Damani: Some change is going on in the company. Move into water management.

Q: Your take on the recent Balmer Lawrie results?

Damani: Great results cheap and good yield.

Q. Banco Product came out with excellent results with topline and bottomline both showing improvement. Final dividend is 90%. Being pure long term invester for years it has been in my portfolio but now with auto industry slowing down, how would you take this call? Should we wait for couple of quarters?

Damani: I think management has delivered. I would hold on.

Q: Is GE CAP getting an aprpoval for Bank?

Damani: No

Q: TCI is looking at expansion and growth plan for FY07-10. EPS and revenue to grow by 30%. High margin business SCM division doing well, equity dilution happening later in Fy09, cushion of Rs 26 from property development. Bullish on logistic. Is TCI growth Value = multibagger? I feel it is already appreciated hugely from 40 to 300 before split. Is my understanding right?

Damani: Seems pretty good, mcap is still modest.

Q: Balmer lawrie's excellent results doesn`t get reflected in price. Is this because it is a PSU company or thats the way market works or market expects better fundamentals?

Damani: In the long run markets are a weighing machine.

Q: Honeywell is doing well for the 2quater. Is it worth buying. What about Macmillan at this rate?

Damani: I have given up on Macmillan, though I still own the stock. Mgmt has missed the big BPO boom.

Q: Your View on Hawkins?

Damani: Hawin's yield and growth looks solid.

Q: No doubt SBI is the leader in all the PSU banks. But time and again with the market it seems to be getting tired and then consolidates. Sometimes even deep corrections take place. Do you have a good feel at this level. It had crossed its old high of 1370 and moved till 1450 and is back again at 1370. What to you say at this point?

Damani: SBI still looks good to me.

Q: Your views on Zee News and Exide Industries?

Damani: I like Zee Entertainment better.

Q: Igarashi Motors, the stock seems to be lagging. Your views?

Damani: It is value but not ripe so a dose of patience is important.

Q: What is your view on oil refining stocks?

Damani: Bullish on HPCL and BPCL.

Q: Tayo Rolls- puny mkt cap, good dividend, tata company, good growth ahead. Your views?

Damani: Yes it offers an opportunity.


Source: Moneycontrol.com

Posted by FR at 8:43 PM  

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Investment in equity shares has its own risks. Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that we consider reliable. I, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and I am not responsible for any loss incurred based upon it.& take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations given in this blog.