Building Up A Portfolio At A 7000 Level

[supratik]

Aha, next tip is on Menon Bearings.

CMP 146.25. The counter had closed yesterday at 135. Today it opened at 140 level(please check) and reached an intraday high of 155.

I suggest a buy on the counter.

EPS FY 2006 expected to be 10. 5

The company's overseas clients include prestigious international institutions like General Motors - USA, Deere and Co. - USA, Arrow Specialty Co. - USA, SAME Tractors - Italy etc.

Its Indian clients include Maruti Udyog Ltd, Mahindra and Mahindra , Escorts, Eicher, Hindustan Motors, TELCO.

Thanks and Regards

 

[supratik]

A little more on Menon Bearings (although it is long back, the clients are still exsting, new clients have been added as mentioned in my previous post)
Menon bearings is a part of the well-established Kolhapur-based Menon group (other listed group company is Menon Pistons). It manufactures engine bearings, bimetal strips, bushes and thrust washers. Clientele include Telco, Maruthi, Mahindra and Mahindra, Cummins and Greaves. Over the last four quarters, the company has consistently improved its performance. Net profit which stood at Rs 15 lac in the second quarter of FY 9803 went up to Rs 41 lac in the third quarter and further to Rs 52 lac in the fourth quarter. In the first quarter of the current year, net profit was Rs 67 lac (up 253% compared to the corresponding previous quarter) on sales of Rs 3.34 cr (up 40%). For the current year, it can report an EPS of Rs 5(up 85%). Though the company is smaller than its competitors-Bimetal Bearings and Gabriel, its performance has been better. Engine parts manufacturers enjoy relatively higher discounting among the auto ancillaries due to the technology intensive nature of the business. Hence at a P/E (on projected EPS) of 4.2 times (Price: Rs 21), Menon Bearings is a good investment bet.


Thanks and Regards

 

[nn0023]

INDSIL ELECTROSMELTS LTD

( BSE CODE : 522165)


CMP Rs. 65.3 BUY

Highlights



* Indsil Electrosmelts can qualify for CDM (clean development mechanism for carbon credit )



* Strategic Shift toward Low carbon Silico Manganese Paying off.



* Expected FY 06 E.P.S > RS 18



Indsil is one of the three companies in the world that produces this ferro alloy. Tinfos (Norway) and Aramet (US-based MNC) being the other two..



* Trading at P/E of 3.6 based on FY 06 E.P.S


Key Indicators



Market Cap Rs 65 cr



Price Performance

52 week H / L Rs. 75/38



1 month Rs. 65/52.7

3 month Rs 66.95/46

6 month Rs. 75/46



Book Value 16.96

P/E 6.5

P/B 4



Indsil is one of the three companies in the world that produces this ferro alloy. Tinfos (Norway) and Aramet (US-based MNC) being the other two.


The company has installed a 21MW hydroelectric power plant at Rajakkad in the Idukky district of Kerala. Kerala is served by both South West and North East monsoon
With a total capacity of 184 million units of power, it is capable of generating 80 million units. Taking into account a wheeling charge of 12% to KSEB, it is capable of making available for the Palakkad unit, 71 million units--equal to its entire annual requirement, at a production cost of Rs1.10/unit as compared to the current price of Rs3.40+/unit that the company pays to KSEB. Excess power above the captive requirement could be sold to the state electricity board



The Indsil reported NP of 9.72 cr against 3.79 last year. The E.P.S of the company comes out be Rs 10.28.




Future Plans



The company plans economies of scale in its capability to produce Low C Si-Mn, the demand for which is estimated to rise in future since demand/consumption of SS200 grade all over the world is increasing





Setting Up of a Coal Based Power Plant at Raipur



The company is in the process of setting up a coal-based power plant under the umbrella of Indsil Energy and Electrochemicals Ltd, a closely held company, set up to acquire a closed ferro alloy unit at Raipur in Chhatisgarh state and for which, the management is carrying out an expansion programme. This program will take shape after Global Ferro Manganese demand again starts increasing. The excess power from Raipur can be wheeled to Palakkad unit so that monsoon dependence is reduced.


SUPRA PL. COMMENT



NANDAN

 

[supratik]

Looks good....Perhaps we can enter the counter, with a medium to long term perspective. I cannot set a target price for the counter but I can suggest that we can buy the counter, because it looks a sound technical counter, good fundamentals.

Again my suugestion would be not buy at one shot, but buy in a 2-3 slots.


Another counter I would suggest at current levels is SAIL.

The counter looks good at the current levels of 67 odd.
I would sugget that above 70(its 52 week high) it can touch 77-85.

Thanks and Regards

 

[curioustrader]

Hello,

Today perhaps was my worst day in 6 months, i lost loads of cash especially in fnO, i think an approx of 1.25L has vanished from my ac.I am in a totally dismal state and shattered,can someone help me out, i aim to recover the lost amount by october end, i can only use 2-2.5 L nowto recover my lost amount.Can someone guide me on what i should add on a fresh portfolio for a month and half holding? Oh my , i am very sad today.

curioustrader

 

[supratik]

Look buddy, I can well understand what a day it was today. It is not merely you but thousands of investors' money vanish in seconds.

There is one unruled statement in the markets, it is easy to earn a hundred than loose a thousand.

I do not want to console you neither can I assure you that I can help you recover your 1.25L.

At the current levels, there are 2 rules
1> Book profits and say 'I am done'
2> Rebuild you portfolio i.e. redeployment of your investment.

I would suggest that the second option is far better.

At this current levels, I would suggest that you invest in technically and fundamentally sound counters.

This would mean that you may include the following counters on dips
1> Reliance
2> Satyam
3> Infosys Tech
4> Tata Power
5> Tata Chemicals
6> ABB
7> SAIL
8> Maharashtra Seamless
9> Hyderabad Industries
10> NTPC

There are a lot more counters to choose.

A much better option would be invest in mutual funds as predicting the markets at current levels is difficult.

Another option that you would enjoy is hedging on derivatives and cash and vice-versa OR taking both a call and put option in the derivatives.

This would be helpful as the markets are volatile and movement in either direction would give you good profits.

These are strategies that you could use in a volatile market.

I do not want to get personal but to my understanding if you have lost a big sum today, then you have a lot of penny counters. Try to rebuild you r portfolio in order to sustain your holdings.

Another statement I would make is, the markets may have rebounded but the correction phase is still not over.

Thanks and Regards

 

[curioustrader]

hey,

I have not sold any of my pennys( i hold them for 4-6 years), i actually lost in futures, today was a very bad for GNFC, AURBINDO ,rel and many more of my fno holdings , they are not abd scrips, but todays sudden movement , power failure and may factors led to the loss. I have not lost money in the cash mkt, only in the futures segment today. And boy was it worst hit or what.

curioustrader

 

[supratik]

Hi All,

Two counters that you could buy in this correction.

1> Era Construction
2> GTC India

They will give considerable returns after this correction. CMP of 143 and 119 respectively.

Targets would be 200 for both.

Thanks and Regards

 

[alokdaga]

What is happening to Financial Technology. After touching 1620 it is contantly in lower circuit for 3 days !! Is there ny bad news for the company?

Alok

 

[supratik]

I have not followed the script.

I believe some other member could be helpful

Thanks ans Regards