STOCK WATCH
Property rates are rising in ‘B’ group cities and construction work is in full swing. Eldeco Housing (Code No: 523329) (Rs.156), a north-based civil construction company has taken several new mega projects worth Rs.250 cr. in Lucknow. Few months back, it launched 4 projects which fetched an overwhelming response in the market. Its other projects like Park View Apts, Suraksha Enclave, Sanskriti Enclave are nearly completed. For FY06 it can report an EPS of Rs.20~25 on its tiny equity of Rs.1.97 cr. A screaming buy in such a growing sector.
Belonging to reputed Winsome Group, Winsome Textiles (Code No: 514470) (Rs.24.05) is a professionally managed company manufacturing 100% cotton yarn for weaving as well as for knitting. To cash in on the post quota boom, the company in undergoing expansion by installing additional 5 combers to convert part production of its carded cotton yarn to combed yarn which has better margins. Also, some balancing machines are being installed for dyeing to enhance productivity. With lower cotton prices and higher demand for yarn, the company is expected to perform much better in the future. For FY06, it can report sales of Rs.150 cr. and NP of Rs.3.50 cr. which means an EPS of Rs.6 on its small equity of Rs.5.90 cr. With a current market cap of a mere Rs.15 cr. and book value of Rs.46, this scrip is a pure multibagger if held for 2~3 years.
The share price of growing mid-cap companies like Mahalaxmi Seamless (Code No: 513460) (Rs.35) has corrected more than 50% in the recent correction and is still hovering around the same level. It is one of the largest producers of cold drawn seamless tubes and its products are used in various industries like petroleum, chemicals, fertilisers, thermal power plants besides oil processing, sugar mills and automobiles. Its pipes and tubes are also used in boilers, heat exchangers and condensers, besides pneumatics and instrumentation. For FY06, it is expected to report sales of Rs.35 cr. and NP of 3.5 cr., which means an EPS of Rs.7 on its current equity of Rs.5.30 cr. A solid buy.
The fall in price of hot rolled (HR) coils is positive for Stelco Strips (Code No: 513530) (Rs.18.55) as it manufactures and markets Cold Rolled Steel Strips/Sheets. Currently, its thrust is to increase exports to China, Ethiopia, Vietnam, Germany etc which currently constitute 36% of its Sales. Moreover, it is implementing a forward integration programme of a continuous galvanising line for the manufacture of G.P and G.C sheets. For the first current six months its Sales doubled to Rs.72 cr. and the NP almost tripled to Rs.1.80 cr. For FY06, it can post an EPS of Rs.6. With a book value of Rs.28 and preferential allotment at Rs.31, the share price can easily appreciate 50% in 12 months.
Eventhough the Sensex is hitting all time highs, there in not much action in mid-cap and small-cap stocks. Seasons Textile (Code No: 514264) (Rs.11.60) which hit a high of Rs.30 a few months back finds no buyers currently at Rs.11. The company manufactures furnishing fabrics and its thrust on exports by tapping new markets in USA & Europe will change its fortunes. In FY05, it modernised it plant and added new capacity of 2,40,000 mtrs. For FY06, it may report Sales of Rs.35 cr. and NP of Rs.2 cr. which means an EPS of Rs.3 on its diluted equity of Rs.6.60 cr. For FY07 it can post an EPS of Rs.5. With a book value of Rs.25 and having made preferential allotment at Rs.15, this scrip is available for a song with a minimal downside risk. Pick it up and keep it for one to two years.
E-Governance has become the buzzword with all State governments and they have allocated huge budgets for various projects. CCS Infotech (Code No:532405 ) (Rs.9.25) being the leading hardware supplier to banks, educational Institutions, government Institutions, state electricity boards, LIC etc is set to benefit from it. It has even started to bid for BOLT projects with the government which will bring in long term revenues. Besides, it has started manufacture of notebooks in the brand name of CCS at its Pondicherry factory. It has even entered a partnership agreement with IBM for marketing Desktops and Laptops. For the six months ending 30th Sept.’05, its Sales has more than tripled to Rs.27 cr. and NP jumped 335% to Rs.2.35 cr. Considering its order in hand position it can report an EPS of around Rs.4 on its current equity of Rs.9.20 cr. Aggressive investors can buy at current levels for handsome gains in the medium to long term.
Belonging to reputed Winsome Group, Winsome Textiles (Code No: 514470) (Rs.24.05) is a professionally managed company manufacturing 100% cotton yarn for weaving as well as for knitting. To cash in on the post quota boom, the company in undergoing expansion by installing additional 5 combers to convert part production of its carded cotton yarn to combed yarn which has better margins. Also, some balancing machines are being installed for dyeing to enhance productivity. With lower cotton prices and higher demand for yarn, the company is expected to perform much better in the future. For FY06, it can report sales of Rs.150 cr. and NP of Rs.3.50 cr. which means an EPS of Rs.6 on its small equity of Rs.5.90 cr. With a current market cap of a mere Rs.15 cr. and book value of Rs.46, this scrip is a pure multibagger if held for 2~3 years.
The share price of growing mid-cap companies like Mahalaxmi Seamless (Code No: 513460) (Rs.35) has corrected more than 50% in the recent correction and is still hovering around the same level. It is one of the largest producers of cold drawn seamless tubes and its products are used in various industries like petroleum, chemicals, fertilisers, thermal power plants besides oil processing, sugar mills and automobiles. Its pipes and tubes are also used in boilers, heat exchangers and condensers, besides pneumatics and instrumentation. For FY06, it is expected to report sales of Rs.35 cr. and NP of 3.5 cr., which means an EPS of Rs.7 on its current equity of Rs.5.30 cr. A solid buy.
The fall in price of hot rolled (HR) coils is positive for Stelco Strips (Code No: 513530) (Rs.18.55) as it manufactures and markets Cold Rolled Steel Strips/Sheets. Currently, its thrust is to increase exports to China, Ethiopia, Vietnam, Germany etc which currently constitute 36% of its Sales. Moreover, it is implementing a forward integration programme of a continuous galvanising line for the manufacture of G.P and G.C sheets. For the first current six months its Sales doubled to Rs.72 cr. and the NP almost tripled to Rs.1.80 cr. For FY06, it can post an EPS of Rs.6. With a book value of Rs.28 and preferential allotment at Rs.31, the share price can easily appreciate 50% in 12 months.
Eventhough the Sensex is hitting all time highs, there in not much action in mid-cap and small-cap stocks. Seasons Textile (Code No: 514264) (Rs.11.60) which hit a high of Rs.30 a few months back finds no buyers currently at Rs.11. The company manufactures furnishing fabrics and its thrust on exports by tapping new markets in USA & Europe will change its fortunes. In FY05, it modernised it plant and added new capacity of 2,40,000 mtrs. For FY06, it may report Sales of Rs.35 cr. and NP of Rs.2 cr. which means an EPS of Rs.3 on its diluted equity of Rs.6.60 cr. For FY07 it can post an EPS of Rs.5. With a book value of Rs.25 and having made preferential allotment at Rs.15, this scrip is available for a song with a minimal downside risk. Pick it up and keep it for one to two years.
E-Governance has become the buzzword with all State governments and they have allocated huge budgets for various projects. CCS Infotech (Code No:532405 ) (Rs.9.25) being the leading hardware supplier to banks, educational Institutions, government Institutions, state electricity boards, LIC etc is set to benefit from it. It has even started to bid for BOLT projects with the government which will bring in long term revenues. Besides, it has started manufacture of notebooks in the brand name of CCS at its Pondicherry factory. It has even entered a partnership agreement with IBM for marketing Desktops and Laptops. For the six months ending 30th Sept.’05, its Sales has more than tripled to Rs.27 cr. and NP jumped 335% to Rs.2.35 cr. Considering its order in hand position it can report an EPS of around Rs.4 on its current equity of Rs.9.20 cr. Aggressive investors can buy at current levels for handsome gains in the medium to long term.
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