STOCK WATCH

Punjab Alkalies (Code No: 506852) (Rs.60), This little talked about company from the Caustic Soda sector seems good from the long-term perspective and can be accumulated at sharp declines only. It is the only major player in the northern region and due to the uptrend in caustic soda prices it has shown a sharp turnaround. Since the last 2 quarters, it has improved its OPM substantially and reported an EPS of Rs.10 for FY05. For FY06, it is expect to post an EPS of Rs.12~14. Its share price can rise 50% in 15 months.

Paper prices are ruling firm on strong demand and manufacturers are hiking product prices regularly as their input cost is increasing and paper stocks are buzzing on the bourses. But Star Paper (Code No: 516022)(Rs.67.70) has still not appreciated with respect to its fundamentals and future prospects. Institutional investors have not taken any stake because of the management’s reputation. But sooner or later, they will take interest and get into this company. For FY05 & FY06, Star Paper is expected to post and EPS of Rs.13 & 16 respectively. A very good buy

Most marketmen believe that freight rates have peaked out and shipping companies will witness de-growth in the coming quarters. In this scenario, one can look at a small company called Garware Shipping (Code No: 501848) (Rs.28.40), which operates only in Indian coastal waters serving the high seas oil industry and is least affected by the downfall in international freight rates. Its 52-week high/low is Rs.33/20. It reported an EPS of Rs.8 for year ending 31st December 04. It has a healthy OPM of around 50% and its BV stands at Rs.48. It has already declared an interim of 5% and is expected to declare final dividend on 20th May. It recently sold one vessel for USD1.95 million for which it will show extraordinary income as well in the current fiscal. A good long term bet.

Elder Pharma (Code No: 532322) (Rs.180.35) is trading in a narrow range for quite some time. But since the pharma index has bottomed out and is ready for a sharp upmove the stock could move into a new zone. Elder Pharma has ambitious plans to launch various lifestyle drugs for which its has tied with more than 25 multinationals and has formed a separate division ‘EL Life’. For FY06, the company is expected to report an EPS of Rs.20 and the share price may shoot up to Rs.250 once it catches the market fancy. Buy and hold patiently as there is hardly any downward risk.

Recently Agro Dutch Industries (Code No: 519281) (Rs.49.90) has attracted market attention and started to move up. The company is planning to raise capital for an ambitious expansion plan. It is fully integrated from composting to can making and canning. Moreover, it specialises in growing mushrooms round the year, which gives it an edge over its competitors. For FY05, the company is expected to post an EPS of Rs.10 and if the company declares some dividend, its share price can easily rise 50% from the current level. A very good bet for short to medium term

In the sugar sector, KCP Sugar & Industries looks very promising and is available at reasonable discounting. The company's Rs.15-cr. co-generation power plant is expected to go on stream in October 2005. Recently, it doubled its daily production capacity to 50 kilo litres (kl) each for rectified spirit, ethanol and extra neutral alcohol. Besides, it also manufactures and markets bio-compost and bio-fertilizers. For FY06, it is expected to report record sales and NP registering an EPS of more than Rs.35. Its share price can rise 50% in coming 12 months.