Stock Recommendations

#1
Hi Alchemist,

I've been checking this forum for the last one month or so.

IPO section is my favourite..

Your analysis and knowledge sharing has been wonderful..

Hope you will continue this for long time and keep the forum alive..

I am expecting you to start a thread on stock recommendations by reputed brokerages and their price targets for individual stocks..

I feel it would be very useful for other boarders as well..
 
#2
Recommendations of stock

Hi,

Today only I received mail from my friend in India who send me UBS report on INR and it said that US$ will stablize at 40-41, so i think it is time to invest in stocks like TCS, Wipro etc. what u say
 
#4
As per my knowledge, it will be in the next 3-4 months. All negatives regarding mortgage woes will be discounted within the next 2-3 months.

Rest Alchemist is the best judge as he follows news thoroughly, maybe he can put more light on this matter, as for me i have started collected Wipro, TCS and infosys at every declines.
 
#5
Kuddos to Alchemist - His efforts are much appreciated.
bverma - u are doing right at this stage of buying IT stocks at every dip. But i feel this is a bit of risk. Most of the IT stocks are reaching their lowest points or even below that. And if for some reason Rupee does not rise - it would be a unfortunate decision. So my feeling is why not put money in stocks which are moving - like Birla Power , Hotel Leela, Welspun Gujarat, KS Oil , Dish TV - and some more may be.
 

man4urheart

Well-known member
#6
I agree there is still a lot more to come in Dollar downfall....

IT stocks should be avoided right now.....

Infy, MBT and TCS prices are still looking for bottom. We should wait a bit more. especially till RBS delivers another subPrime loss on 06-Dec-2007.

Gulf countries will take a decision on re value their currencies on 3-4 Dec.

FED bank statement on 11-Dec-2007.

All these factors will move dollar, god knows on which side...so IT counters will drop more as per my understanding.

Alchemist your view sir?

P.S: Euro/ Pound Strengthens against Dollar and US Dollar reserves are down from 74 % world share to 64% in last quarter.
 
#7
Why invest in IT stocks when - Infrastructure or Oil and Gas is doing so great and will continue to. Try Banking as well.
What do you say Mr.Alchemist.
 
#8
Hi friends,

Yes u all r right, there is a risk in that as u must have seen infosys touching 1500, but yes i am still buying. But yes if u want good returns u can buy Gujarat NRE coke, i bought 300 of them at just above 100 few days back and it is really giving me returns. it is firm in down market also. I am not in touch of Indian economy so that is why i really appreciate ur effort of guiding me in choosing right stock. Regarding Hotel Leela it is a good stock if the rumors of foreign investment comes true otherwise it is fairly priced.

I will really appreciate if Alchemist tell us what to buy or what not to buy in this market as i am not into ipo, frankly i have rarely received any allotment (my luck is like that in ipo) :(.
 

Alchemist

Administrator
Staff member
#9
IT stocks no longer excite me.

These companies may be listed in India, most of their business is coming from the US.

The future of US looks gloomy right now. News flow is very negative.

The Federal Reserve expects economic growth to slow sharply next year, and policy makers there are worried that even this forecast may prove too optimistic, according to an assessment that the central bank released on Tuesday
Source: http://www.nytimes.com/2007/11/21/business/21fed.html?ref=business

Add to this, the pressures of the falling dollar and India's sunshine sector looks very ordinary.

My brother works for Cognizant Technology Solutions... one of the biggest IT companies in India.

He is constantly in touch with his friends on other major IT companies.

It is the same story everywhere - extreme cost-cutting;

-people are made to work 6 (sometimes 7) days per week, instead of 5 days, which was the norm a year back.
-working hours have gone up.
-incentives have vanished.
-salary increases have reduced.
-many companies are actually paying freshers less than what they were paying a year back.

IT companies have protected their margins till now by such cost-cutting, but there is a limit to how much cost-cutting can be done.

If the dollar goes down further, the impact on earnings of IT companies will be more than what it has been during the earlier fall.

The dollar made a fresh all-time low against the Euro yesterday. If it weren't for RBI intervention, US dollar would be at Rs 35 by now.

I am staying away from IT stocks.

IT stocks can offer trading opportunities. They will bounce back after all sharp falls, but the long-term doesn't appear rosy.
 

ams

New member
#10
Is it good time to invest ?

Hi Mr. Alchemist

I want to enter share market. Is this a good time for that, since theres a correction of 700 points. Or should I wait till 12 Dec.
Also what scrips to consider, for short term and long term.

TIA
 

Alchemist

Administrator
Staff member
#12
Hi Mr. Alchemist

I want to enter share market. Is this a good time for that, since theres a correction of 700 points. Or should I wait till 12 Dec.
Also what scrips to consider, for short term and long term.

TIA
How much cash do you have?

If you have cash of more than Rs 1 lac, apply for IPO's. There is less downside risk in IPO's.

If you apply for 2-3 bigger IPO's, you will get allotment in at least one.

Kolte-Patil Developer's IPO closes today. You can apply for it.

These levels are a bit high for fresh entry. There may be more down-side in the short to medium term. Enter at these levels only if you are willing to hold for 3 years or more.
 
#13
Stocks To Be

I would like to suggest some stocks which I am going to consider myself after i get my refund from Mundra IPO in which got only 15 alloted(hate oversubscription).

Anyways coming back to the point:

Must: :D
GE SHIPPING
NOIDA TOLL BRIDGE
RIIL
TANLA SOLUTIONS
PETRONET LNG
NTPC

Could: :)
RIL
SBI
BANK OF RAJASTHAN
DENA BANK
ADLABS
SUZLON
PRIME SECURITIES
DREDGING CORP

Maybees: :confused:
L&T
BHEL
ABAN OFFSHORE
ONGC


I have classified them in the three categories for a reason.

First I have tried to classify them in terms of returns(6-12months min).
"Must" being the highest and so on.

Next I have also kept in mind that the people viewing this website are usually small - mid retail investors who wouldnt want to buy a stock worth Rs.3000-4000(like L&T) although i think these are amazing stocks.

I am going to write about all the "MUST" stocks in the days to come.
Except GE Shipping, which i have mentioned below.

Since markets are taking a descend, I thought ppl are going to get in a mood to buy. But I would suggest taking a cautious step before entering especially if you are a trader.

All the above stocks i have mentioned are mainly for investment purpose with time span of a year.


GE SHIPPING: :D

Vijay Sheth-promoted Great Offshore was created by demerging the offshore division of Great Eastern Shipping Company (GE Shipping), India’s largest private shipping company, following a long family feud.


What do they do:

Shipping - Transportation of crude oil, petroleum products, gas and dry bulk commodities.
Offshore - Provides services to the oil companies in carrying out offshore exploration and production activities, through its wholly owned subsidiary Greatship (India) Limited.

Financials At a Glance:

Q1 FY 2007-08 Net Profit at Rs.421.04 crores, up 74.7%

Q2 FY 08 Net Profit at Rs.342.79 Crs, up 46%

The company has raised additional funds of Rs 150 crore by way of issue and allotment on September 07, 2007 of 15,00,000, 10% Optionally Convertible Redeemable Preference shares of Rs 1,000/- each to Export Import Bank of India. The Company has also issued Foreign Currency Convertible Bonds (due 2012) on October 05, 2007, of US$ 42,000,000 which have been listed on the Singapore Exchange Securities Trading on October 12, 2007 and which are convertible into equity shares at a price of Rs 875/- per share and YTM of 7.25%.

The company has completed the major modification work undertaken on Malaviya Thirty Six and the vessel has commenced her 5-year charter with ONGCL on October 05, 2007.

The Financial Report can be found here: http://www.greatship.com/media/pr/PR_H1FY08.pdf


Future:

Currently, the offshore companies are experiencing a boom as the soaring oil prices have forced such offshore companies to step up the search for more oil, this increasing the prospects of oil and gas explorations. This is great time for offshore supply companies to mint money. Infact, in India itself, the leaders like GE Shipping, Mercator, Varun Shipping and Essar Shipping are all expanding their fleets and charter rates have shot up by more than 100%.

Great Offshore is also in the midst of expanding its fleet. The company recently secured a major 5-year contract in July 2007 from ONGC, estimated at Rs.1,000 crore and the company is expected to start work on this from May 2009.
 
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PPP

New member
#15
Pharma sector

Hi Alchemist,

I want to know your thoughts on pharma sector as some of the pharma
stocks are at their 52 week lows. e.g. Dr.Reddys, Cipla, Aurobindo pharma

Yes,their margins are under press because of rupee appreciation, but
compared to IT stocks they are not totally dependent on US markets,
Domestic & other markets are there.

Any reasons for their underperformance or these stocks are good at
these levels with medium to long term view.

Thanks.
 
#16
Noida Toll Bridge

NOIDA TOLL BRIDGE

The Noida Toll Bridge Company Ltd. (NTBCL) has been promoted by Infrastructure Leasing and Financial Services Ltd. (IL&FS) as a special purpose vehicle (SPV) to develop construct, operate and maintain the DND Flyway on a Build Own Operate Transfer (BOOT) basis. NTBCL is a public listed company, incorporated in Uttar Pradesh, India, in 1996 and operates only in India.

The Delhi Noida Bridge is a tolled facility connecting Noida to South Delhi across the Yamuna river. The Company’s principal source of revenue is from the levy of tolls on commuters on this facility.

------------------------------------------------------------------------------------------------------------------------------------------------

Financials:

The Profit before Interest & Depreciation has increased by more than 40% over the previous year mainly due to a consistent increase in traffic and toll revenue.

As compared to the Average Daily Traffic (ADT) of 60,840 vehicles in the previous year the ADT in the current FY 2006-07 was significantly higher at 68,648 vehicles, showing a healthy increase of 13% over the corresponding year.

The income from operations for the current year was at Rs.471.11 million, more than 20% higher than the corresponding year. The growth in income has outpaced the growth in traffic due to annual revision in toll rates as well as an increase in other operational income.

The operating profit margin has also shown an increase to 75% as against 65% over the previous year.

The Company is implementing the Mayur Vihar Link Road Project and the work commenced in July, 2006 after obtaining necessary approvals. Expenses directly attributable to the project have been capitalized. This link, likely to be completed in the second quarter of financial year 2007-08, will improve the accessibility of the Delhi Noida Bridge from East Delhi resulting in improved traffic.

The Company has prepaid term loans carrying interest between 8.5% pa to 12.5% pa to the extent of Rs. 1.57 billion out of the proceeds of the GDR launched in March 2006 which, coupled with the restructuring of Deep Discount Bonds completed during 2005-2006, has resulted in a reduction of over 22% in finance charges over the previous year.


Balance Sheet Rs.in Crore
Total Share Capital --186.20
Net Worth -- 361.69
Total Debt --185.99
Net Block --404.15
Investments --8.35
Net Current Assets-- 97.56
Total Assets --547.67


Year ended 31.3.2006 -- Rs. in Million
Income from Operations -- 390.74
Other Income -- 16.00
Operating & Administration Expenses -- 118.60
Miscellaneous Expenditure written off -- 25.40
Profit before Interest & Depreciation -- 262.74
Interest & Finance charges -- 232.54
Depreciation -- 3.34
Provision for Tax/ FBT -- 0.78

Net Profit 26.08

Year ended 31.3.2007 -- Rs. in Million
Income from Operations -- 471.11
Other Income -- 20.06
Operating & Administration Expenses-- 108.66
Miscellaneous Expenditure written off -- 12.43
Profit before Interest & Depreciation -- 370.08
Interest & Finance charges -- 180.66
Depreciation -- 78.01
Provision for Tax/ FBT -- 0.80

Net Profit -- 110.61


The main business comes from collecting toll from people using this toll road. I understand it does not sound very exciting or profitable. But infact it has been doubling its profits for past two years.
The amount of profit generated mostly depends on the amount of traffic on DND Flyover.
Nodia region has huge numbers of BPOs and KPOs. New Knowledge Parks and IT Cities are opening up in Noida and Greater Noida Region. Each one of these BPOs & KPOs has several thousands of employees . Most of these employees use the transportation provided by the company they work for. The others have their own vehicles. All these BPOs and KPOs work 24 hours a day, 7 days a week, 365 days a year. On a conservative estimate, atleast one-third of all the cabs that the Noida BPOs/KPOs use go via the DND flyway. Cost is not a factor for the companies, the time and the convenience of their employees definitely is.

And the BPOs and KPOs form just a tiny part of the Noida / Greater Noida traffic - there are a lot of prime commercial and residential properties that are coming up in this area.

The management has already thought of increasing the number of paybooths to streamline the traffic in the years to come.

------------------------------------------------------------------------------------------------------------------------------

Future:

NTBCL to shorten the travel distance for people living in Mayur Vihar and others accessing areas in its vicinity. A recent study had estimated the impact of
developments in a narrow stretch along the Noida-Greater Noida Expressway. This was extended to other undeveloped areas of Noida and Greater Noida, and it
is estimated that these developments will result in an additional population of 1.6 million. Other developments in recently and earlier developed areas will result in
another 0.4 million for a total population growth of 2.0 million. This population increase is significantly greater than a previous estimate of 0.64
million by 2002 traffic study. Therefore, the traffic is also expected to grow significantly more than that estimated in the 2002 traffic study. It is expected that
in the financial year ending 2021, there will be 200,504 daily vehicle trips on DND Flyway. This is more than the 2002 traffic study estimate of 122,233 and the 2005
estimate of 199,613. The roadway capacity of 222,000 vehicles is adequate for the expected traffic. The toll plaza capacity is about 25% higher than this, and thus
none of these components are expected to constrain the traffic flow or its growth.

This is one of the best low priced stocks available in the market today. The potential of the stock has not been recognized by the market, which is probably why it continues to remain low.

The biggest plus in favour of the company is that the company has about 240 acres of surplus land, of which, about 200 acres is on Delhi side while 40 acres is on Noida side. This land is likely to get developed, for which permission has been sought. This land was valued at about Rs.350 crore in 2002 which is presently valued at close to Rs.1,500 crore. Also company’s toll bridge across Yamuna, a 553 meter bridge, linking Noida with Delhi, where present traffic is close to 1 lakh vehicles per day, is currently one way. Once the route fully becomes two-way, the prospects of the company get even better.

So given the growth prospects of its real estate foray and once the Mayur Vihar-Noida link becomes two-way, Noida Toll is expected to show an even better growth rate.
 
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#17
Baltic Dry Index (BDI) tracks shipping rates of 4 main routes globally.

http://www.dryships.com/index.cfm?get=report

This index had a great run in 2007. Demand for shipping Iron ore to China, port congestion etc. is causing the rate hike. The industry outlook is favorable. On the supply side, many new ships will be entering the market only in 2009-2010, since order takes >2 years to be delivered.

The shipping stocks in US have pulled back after a long run on fears of global economic slowdown/recession.

Alchemist gurudev, any comments on Shipping sector?

Especially
Varun Shipping
Great eastern Shipping
Mercator Lines?
 
#18
Next in the league RIIL

Next in the league after GE Shipping and NTBL is Reliance Industrial Infrastructure Ltd.

RIIL:D

Reliance Industrial Infrastructure (RELIANCEINF), part of the Reliance group, is engaged in construction and setting up of industrial infrastructure and project related activities.

The company undertook a project for laying of two cross country pipelines from Bharat Petroleum Corporation`s (BPCL) refinery at Chembur in Bombay, Maharashtra to Reliance Industries (RIL) Petrochemicals complex at Patalganga in Maharashtra to transport petroleum feedstock from BPCL for the exclusive use of RIL. The pipelines would be owned, maintained and operated by the company under an agreement entered into with RIL. The pipelines would be used for transport of its petroleum feedstock.

Reliance Industrial Infrastructure undertakes infrastructure activities for group and other companies. It is also involved in the leasing business.


Financials:

Reliance Industrial Infrastructure registered a profit of Rs 55.08 million for the quarter ended September 2007.
It recorded a net sales of Rs 156.6 million for the quarter.
Total income was Rs 188.66 million for the quarter ended September 2007.


Balance Sheet Rs in Crore
Total Share Capital -- 15.10
Net Worth -- 136.72
Total Debt --114.00
Net Block --51.69
Investments --11.35
Net Current Assets-- 185.24
Total Assets --250.73


Future:

Honestly speaking, the company has not been well advertised. It does not have its own website and getting info about this company is difficult.

But I see good fundamentals, which may not justify the price right now, but in time to come I see the price settling to Rs.1500 to Rs 1300 odd which should be a trigger to buy.

The reasons, I think, for this stock to excel in the future are:
-Stock Split may happen any time in the next quarter as the price seems to be bit high(as i mentioned earlier) at the current market price.
-The construction/real estate/service/infra sector has a very bright future.

The current market price is Rs.1883, having a 52-week high of Rs. 3175, and the 52-week low is Rs.357.30. If it falls down, it has the support at Rs.1500 and further support at Rs.1350.

I feel the stock has tremendous potential in the years to come and can give excellent returns in 1-2years time.
 
#19
Tanla Solutions

Next in the list of the stocks i recommended comes TANLA SOLUTIONS

RANKED Sixth among the top 50 fastest growing technology company in Deloitte Technology Fast 50 India 2007 Program.

Founded in 1999 by a multi-talented group of professionals with proven business credentials.
Tanla Solutions Limited is a rapidly expanding, profit making company with its software development centre in Hyderabad, Andhra Pradesh, India, and worldwide marketing office in the U.K.

TANLA Solutions is a company which provide services to Telecom Providers like RPL, Airtel, Hutch etc.

Some of the products of the company:
SMSC
Multiple
MSISDN
Optimal Routing Solution
CRBT
SS7 Voice Mail Server
Missed Call Alert
SMS Direct Broadcast
High Density Media Servers
Prepaid Roaming

And

Telematics & Telemetry which i think in the future have a great scope for development, especially in India.


There has been accelerated growth in revenues and profitability with consolidated total income of Rs. 111.42 crore (up from Rs. 94.51 crore in Q1) and net profit of Rs. 36.74 crore (up from Rs. 33.26 crore in Q1).


These were consolidated results and it included financials of wholly owned subsidiaries - Tanla Solutions (UK) Ltd., Tanla Mobile Asia Pacific Pte. Ltd, Singapore, Tanla Mobile Ireland Private Limited, Dublin, Ireland and Tanla Mobile Inc., New Jersey, USA .


During the quarter, Tanla Mobile Asia Pacific Pte. Ltd,Singapore and Tanla Mobile Ireland Private Limited, Ireland started their commercial operations.


Tanla has recently launched Payforit services in the UK in partnership with all UK mobile operators. The company is now focused on further expanding its product set to enhance its capabilities to deliver Mobile Commerce and Mobile Advertising solutions on a global basis.


The company has also signed agreements for messaging and mobile payment services with leading mobile operators in India.

The company’s fortunes are directly linked to that of the telecom sector and with the sector all set to takeoff further, things could only get better for Tanla. Best to hold on to this stock.

Their last quarter profit was extremely promisable. With the growth in the telecom sector further in India , especially in fields of Telematics and Telemetry I have positive outlook for this company.

They offshore services as well, providing IT solutions to other providers worldwide.

Hence to conclude, I see tremendous potential in this company and a bright future.

Recommend: Strong Buy
Time Period: 6 - 12 months

Price Recommended: Rs.650-670



References:
www.tanlasolutions.com
www.moneycontrol.com
www.deloitte.com
www.sptulsian.com



Suggestions always welcome.!
 
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