Persistent System Bonus

Persistent system is going to give bonus announcement in the meeting scheduled on 24-Jan-2015. Considering this year is its 25th anniversary, expect it to be a generous bonus. If there is a split too occurring then we can expect price to appreciate at least 10 to 20% from here.

I would recommend holding the share if you already bought, if not it does give a good entry point at 1743 at today's price.

Stocks 20141217

I sold 30% of remaining stocks of NATCO pharma.

The proceeds went to buy following

SEAMEC - looks attractively priced after the deep correction from 140 level to 103. All vessels are deployed so expect a bumper quarter from them. It will shoot up and reach 160+ easily after next quarter result.

SELAN - the woes of falling crude oil price is having its impact on Selan. I feel oil might correct and reach upper 40s, Selan would reach 275 or so. This would be attractively priced and as crude settles around 60, it would give good profits.

Persistent - Next year in May it will complete its 25th anniversary. Company is debt free and making good profits. Expect good dividend/bonus or split.

Force - Expecting the revenues to quadruple in 5 years, price will catch up during that time. Expect it to emulate Eicher Motors and be next multi bagger.

Selan & Seamac

Booked some more partial profit in NATCO. Now all my remaining NATCO shares are grand fathered (AKA free of cost to me so going to hold for very very long term barring some emergency.

The proceed from that is now going to buy some more stocks of Selan Exploration and Seamec.

Selan Exploration

With crude reaching 65$ and OPEC not cutting down on the output, see the crude to stumble more. May be lower 50$/barrel.

Considering this Selan too is falling it has reached 371Rs as of posting now.

Last quarter their profit was 9.57 crore with EPS of 5.84 (data from moneycontrol.com).

With new wells going into production, inspite of the drop in crude, profit could remain the same or marginally better. It is quoting at P/E of 14 against industry PE of 12 (data from moneycontrol.com). There might still be correction of 25 to 50 rupees to make it in line with industry PE.

I think we are seeing bottom of Selan and recommend buying it around 350 or so. If you are having this shares, my advise is to hold on to it. Any increase in crude will ensure that price of Selan too will jump up.

Stocks 20141126

Sorry for posting this late.

I booked partial profits in NATCO pharma and bought the following

50% proceeds went to Persistent Systems
50% proceeds went to Tata Coffee

Both of these stocks can give 20 to 30% returns in couple of months.

Another stock Selan Exploration is reaching sub 400 levels. It can potentially reach 375. If it does it would be a sure shot buy. I might sell my Central Bank Shares and move to Selan. Over 2 to 3 years horizon, it can be potential multi bagger. Central Bank can never be such multi bagger as it is safe stock.

20141119 - Stocks Shuffling

Sold my complete holding in following companies

BHEL
EClerx Services
Unitech

The proceeds went to buy

Wockhartd

you might be surprised as I already have 15% of my portfolio allocated to wockhartd at half the current price. Wockhartd is working hard to get the USFDA approval. With all negatives factored in the price of wockhartd is pretty steady in 800 - 850 region. It is waiting for the USFDA nod after which it will fly of the shelf. Hope to see this trigger sooner rather than later. But don't expect it to be in 2014.

BHEL partial profit booked

BHEL gave another set of bad number. I booked partial profit in it. Sold 75% of my holding in BHEL.

Moved the proceed of the sale to

Central Bank - 25%
Unitech - 50%
Eclerx Services - 25%

Meanwhile Seamec gave its numbers today. Numbers look bad. From profit of 24 cr last quarter a loss of 10 crore this quarter. Only saving grace is there is little dry dock this quarter and YoY loss came down from 64 cr to 10 cr. I expect some correction in the share. Hope to pickup some more if price goes down.

Stocks Reshuffling... 31-Oct-2014

50% holding in BHEL is liquidated

Proceeds from the sale went to

Eclerx Services -25%
IFCI - 20%
Central Bank - 20%
Force Motors - 10%
Persistent system - 25%

out of this bunch, Eclerx and Persistent look attractive.

Bought Following Shares

Bought the following share after booking partial profit in HPCL.

1. Coral Labs (Debt free company with pretty low pe).
2. Ybrant Digital (High risk stock, not recommended for buying)
3. Albert David (Another debt free pharma company wit low pe)
4. Persistent System (Good IT company bought for long term perspective)
5. EClerx services (Good IT company bought from long term perspective)

Keep holding your Wockhartd, Force, Seamac and Deccan gold. The last one can surprise this month. Keep holding.

Force Motors and SeaMac

I bought some stocks of Force Motors and SeaMac today.

SeaMac is in cyclic upturn. Currently quoting at 136. For last two quarters it has given EPS of 7. Industry PE is around 21. Assuming same EPS per quarter, we are looking at 28 annual EPS. With PE of 20, it could easily reach 400+ if not 540 based on simple math. All its vessels are booked for next two years. So, chances of getting EPS of 28 this year looks very high.

Force motors is in auto sector, Earlier known as Bajaj Tempo. Stock price 734. Quaterly EPS 14. Last quarter was 34. Assuming average of 20 quarterly EPS, annual EPS would be 80. PE at current price is 12. Industry PE is 259 (which is way high for my comfort). Conservative PE of 20 to 30 is good for auto sectory. Assuming the same Force can scale 1600 (PE of 20), 2400 (PE of 30).

Keep an eye on NATCO pharma. I have good amount of it and might add more on decline if any.

Wockhartd, Shilpa Medicare, BHEL, LIC housing, IFCI, Shriram Transport

I am recommending following stocks to buy currently.

Wockhartd - looks attractive at this price. Worst seems to be over for the stock and it is working to get FDA approval for the banned plants. That should be resolved within couple of quarters now. Currently quoting 464.15.

Shilpa Medicare - This is going to become a big player has good product pipeline should accumulate it as the volume is low and not many major players are involved. Can easily reach 750+ by 2015/16. Currently quoting at 239.

BHEL - Open a small position as chances of having NDA looks better, if it were to be true all PSU would shoot up and BHEL would be front runner, can go to previous highs of 450+, currently quoting at 133.

I also diversified my holding in IFCI and Yes bank to Rel cap, Shriram Transport, LIC housing finance. They are running for banking license. Assuming one of them gets the license they will surely go up and make up for losses if any in others. If all get licenses then profit margin can be higher. Assuming another year for getting the license, each one of them barring Reliance Cap can double from current price. Relcap is already at higher PE so  might not appreciate that much.

Infy Puts

And my infy put call went wrong, suffering big loss almost 80% loss :-)

Infy Put Options/IFCI Call Options

Its been a long time since I posted in this blog. Over the course of last 2 1/2 years I have accumulated some stocks and waiting for them to bear fruits during this bull run :-). I am currently holding Central Bank, IFCI, Rolta, Punj Lloyd, SPIC, Reliance Power, Deccan Gold, Selan Exploration, Jain Irrigation, GTL and Nutek.

For short term I am buying some Put Options of Infosys. I am not expecting the results to be that good and there would be some correction in the price. I bought some puts for Jan at premium of 108 for strike 2400. I expect after result the premium to go up to 150.

Another options to look for is IFCI call options strike price 37.5 for Jan. They are looking pretty good.

Mahindra Satyam

Lets take a look at the stock of Mahindra Satyam. They are going to declare the result on 29-Sep, for the years in which scam surfaced. First sign of optimistic result is that 29th is a wednesday. Normally, if results are bad, people generally avoid giving them on trading day.

Assuming, that 1/2 of the amount was falsified by one Mr Raju. So, its revenues would be around 4000 crore and profit of around 900 crores. It places Satyam some where in leagues of HCL Tech, Mphasis etc. HCL is having a market cap of currently  29000 crore, Satyam having some 11000 crore. Assuming, the above 1/2 falsified amount, the market cap should quote similar to HCL, so price can see appreciation of another 50 to 100% from the current price.

I have been accumulating this stock for quite some time and have almost 20% of my portfolio built on satyam (not a good idea, but betting on the odds has been a weakness of mine).

If things goes like I said earlier, it can give handsome returns in days to come. Also, once the uncertainty factor is removed from the stock, it is bound to give a direction. Up or down that needs to be seen. I hope it is upward.

I would recommend buying Satyam on dips for a longer term horizon.

Wockhardt

wockhardt... doing great... gave the tip on Jun-2010 ... those who bought it would have made good profits...

looking at the sales turn over and market cap of similar pharma co, it should have a market cap of near 10k cr... currently it is 2.5K cr. So, possible apprecation of another 50 to 100% over a period of 1 to 2 years seems reasonable...

disclaimer: i have some position in this stock from jun-2010. please buy/sell at your own risk.. :-)

Wockhardt

Let me start with stating that this one is truly for bravehearts. It was once upon a time 3 years back it was quoting around 400+, now it is battered down to 136, a slight recovery from 115 its 52 week low.

So how did this happen? well, they wanted to grow inorganically so acquired some debt and also hedged against rupee when rupee was strengthening. With the big crash in 2008/09, the growth went for a toss and rupee started declining against $$, so they were stuck with double whammy. Hence the precipitous fall  from 500+ to 70 and it is slowly recovering.

For some of the previous quarters it has been posting loss after loss and paying huge interest. Lenders are lining up to liquidate this company.

So, with all this bad, why am I recommending it? Well, the promoter stake is still 74% and they have been divesting its non core business to reduce its debt, still it will probably take couple of quarters to get back into black. By that time it would have gone higher. Also, there are news that some MNC might take it over in that case it would be really good for share holders. The promoters are trying hard to come out in black and being a branded name globally it can surely do a turn around.

I recommend to open a small position in this stock (I did it already at current price of 136Rs.) with a target of 400+ in couple of years if things go well.

So it is truly braveheart stock, tread with your own risk as risk reward in this share is extremely high.

IDFC to bring global partner aboard

IDFC to bring global partner aboard: "IDFC?s executive director Vikram Limaye told ET the firm was looking at a strategic partnership ?to either manage the fund or advise foreign flow of funds into the Indian equity market?. He declined to give details."

IDFC is a very good long term bet. It would give atleast 10 to 20% annually compounded... If it reaches 140 to 150 again it is good to accumulate. I hold it from when it was in 75Rs mark during 2009 fall... keep buying on dips...

Long time no see...

Long time I have not posted anything as part of recommendation or updates on what I am buying/selling...

Well I have sold out my entire stake in Unitech at good profit of 70%, was hoping it would go higher. But with bad results and losses in telecom business it was not looking attractive. I am also keeping Suzlon on watch list to sell and move out.

The companies I feel look attractive buy right now are JP Associates, Punj Lloyd (have patience in this one) and Bharat Forge. I have around 20 to 25% of my portfolio in these cos and am increasing my position in them as and when I get some chance.

Also, I have opened some position in gold stocks, around 5% of my portfolio. I recommend putting a systematic investment plan in gold and keep holding for couple of years, it will give better returns for sure.


Also keep watching for deccan gold, mining policy is due this session and it can shoot up. I had recommended it at 40, it is now at 26. I have good position in the same around 5% of my portfolio. Expect this lambi race ka ghoda to go great guns when it starts mining (another 1 to 2 years out) but before mining it would be already accumulated and would have gone up. It can potentially give 100 to 500% returns in 2 to 3 years time frame.

So happy investing/trading or whatever...

Punj Lloyd

Well... I recall giving tip for punj lloyd as investment opportunity when it was battered down from 250 to around 165... Would be couple of months back...

I have bought some punj lloyd today. Have booked some partial profit in relpow and suzlon..

Punj lloyd has good order book and has recently won good contracts. I am expecting it to continue good momentum going forward too...

A good stock to keep in portfolio.. Even reliance power is good stock...

Bharat Forge

Recently I bought some shares of Bharat Forge. It was in auto ancillary segment earlier. Now it has made foray into making engineering equipment for power plants/generation. It's current PE is 44 which makes a bit pricy and over valued. However on a long term basis due to its diversification it can be a multi bagger in years to come.

I recommend it as buy on dips for a long term horizon of 3 to 4 years. With power related infrastructure to be the next boom in India this decade (along with health care) it is worth taking the risk.

I expect the share to provide 100% return on the CMP of 255Rs.

Also recommended for reading is the intelligent investor book by Benjamin Graham. One of my friend Shashi recommended it to me. You can buy it from amazon directly if interested. I have given the link.