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Monday, July 30, 2007

Net profit of TIL (Rs.297.50), which we discussed last week, rose 82.87% to Rs.3.95 cr. in the quarter ended June'07 as against Rs.2.16 cr. during June'06 quarter. Sales rose 20.68% to Rs.130.74 cr. in Q1FY08 as against Rs.108.34 cr. during Q1FY07. Its outlook is very encouraging.

At its AGM on 24th July 2007, TIL announced a capex plan of Rs.175 cr. to be spent over a period of two years for manufacturing material handling, construction and mining equipment. The capex could be towards procuring land, augmenting its crane manufacturing facility, and setting up a facility to manufacture advanced port equipment like rubber tyred rail mounted gantry cranes and electric level luffing cranes. Some contribution from this could come in FY09. TIL's management is looking at a mix of debt and equity to fund the capex, which is a high growth segment on account of strong investments in the port sector. With this capex in place, TIL is well poised to meet the additional demand coming from the ongoing capex across sectors like coal mining, ports, retail, and IT.

Good times are ahead for the company. Investors should keep a watch to add the scrip on reactions.

Market Guidance

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Net profit of Yuken India (Rs.182) rose 137.50% to Rs.0.76 cr. in the quarter ended June'07 as against Rs.0.32 cr. for quarter ended June'06. Sales rose 8.02% to Rs.19.67 cr. in Q1FY08 as against Rs.18.21 cr. in Q1FY07. Since outlook for the company is very encouraging, the company should report better results in coming quarters.

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Net profit of VIP Industries' (Rs.122.30) rose 158.27% to Rs.10.77 cr. in the quarter ended 30th June'07 as against Rs.4.17 cr. in the previous quarter ended 30th June'06. Sales rose 48.74% to Rs.154.53 cr. in Q1FY08 as against Rs.103.89 cr. in Q1FY07. Investors should continue to hold this stock. 11

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Net profit of Ion Exchange (India) (Rs.163.15) rose 225% to Rs.1.43 cr. in the quarter ended 30th June'07 as against Rs.0.44 cr. in the previous quarter ended 30th June'06. Sales rose 43.78% to Rs.92.64 cr. in Q1FY08 as against Rs.64.43 cr. in Q1FY07. Investors may please read following notes to accounts.

"The company has invested Rs.5.460 mn. and extended advances of Rs.133.532 mn. to Ion Exchange Enviro Farms Ltd. (IEEFL), a subsidiary company, whose accumulated loss exceed its paid up share capital and where the amount or provision required in respect of possible loss, if any, is presently not ascertainable. The company views its investment in IEEFL as strategic in nature. IEEFL has undertaken various cost reduction programme and it expects bettor returns in coming years from its organic farming activities, bio-pesticides and bio-fertilizers marketing. Moreover, IEEFL has adequate assets in the form of developed and undeveloped land and office premises. In view of the foregoing, the management is of the opinion that there is no diminution other than temporary in the value of its investments and the advances are recoverable. Hence presently no provision is considered necessary."

This is indication of property development or sale of the same. Investors are advised to stay invested in this stock with long-term view.

* Stelco Strips (Rs.41.15)

is into the same product as Bhushan Steels and Uttam Galva and is projected to report sales of around Rs.270 cr. for 2007-08 with operating profit of around Rs.17 cr. and net profit of around Rs.6.5 - 7 cr. The stock is attracting speculative interest on investment buying by informed investors. The stock has given a good breakout. Stay invested.

* Confidence Petro (Rs.20.54)

- We had recommended this scrip earlier at Rs.5.75 level and advise to book profit as the stock has gone up ahead of the fundamentals. Switch to Gandhimathi Appliance (Rs.13.70).

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Restructuring should help Surya Roshni (Rs.58) in reducing debts and creating good wealth for investors through unlocking real estate values. Stay invested.

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Those looking for gains with some risk can look at Western India Shipyard (Rs.16) .

* Revathi Equipments (Rs.810)

has reported consolidated net profit of Rs.5.07 cr. on its equity of Rs.3.07 cr. for Q1FY08. Coal India is slow in placing orders and is likely to do so in the 2nd half of the current fiscal, which will spurt the sales of the company. The stock is likely to get support around Rs.800 level.

* DLF (Rs.586)

is strongly advised by leading brokers for investment. With the expected fall in interest on housing loans, the sector is being re-rated by analysts. It seems that best is yet to be seen in this sector.

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Investors can take small exposure in Western India Shipyard (Rs.16.2) . It is likely to become good story over the long run.

* JMC Projects (Rs.285)

is expected to come out with encouraging results along with good plans and investors are advised to remain invested. Leaders have got multifold growth in this stock by way of two rights issues and warrants as we recommended it from Rs.55 onwards in this column.

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Those having sold Radha Madhav (Rs.69) at higher levels can think of investing again at the current level.

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Book partial of profit in Navbharat Ventures (Rs.198) and Bartronics (Rs.) as both have flared by more than 60% over the last 45 days. Switch part profit to GSFC (Rs.) and Supreme Industries (Rs.) for securing the profit and also for good long-term returns.

* Trigyn's (Rs.31)

valuation looks attractive. Investors can take small exposure in this stock on reactions.

* Add on reactions,

Kojam Fininvest around Rs.180 , D&H Welding at Rs.35, Torrent Cables at Rs.190 and Excel Industries at Rs.56.

Posted by pp at 12:56 PM  

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IMPORTANT DISCLAIMER

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.