TOWER TALK

Money Times - - Tower Talk -

HBL Power Systems, man­u­fac­turer of standby bat­ter­ies for rail­ways, aviation and other in­dus­tries in­clud­ing digital con­trol har­ness for navy sub­marines, is re­port­ing higher vol­umes and ris­ing prices. A sci­en­tific ap­proach jus­ti­fies buy­ing this stock.

The big rally in I G Petro­chem­i­cals has be­gun. Its Q1 EPS of Rs.13 is in­dica­tive of an EPS of over Rs.50 for FY18. With in­dus­try P/E at ~21x, the stock may cross the mag­i­cal price of Rs.1000 in a few months. Buy im­me­di­ately.

Re­liance In­dus­tries plans to expand its Jam­na­gar re­fin­ery from 60 MMTPA to 100 MMTPA by 2030 at an es­ti­mated cost of $10 bil­lion. There seems to be a big gap in the CMP and its in­trin­sic worth. The J.K. Tyre & In­dus­tries stock shows signs of a big break­out. Anti-dump­ing duty im­posed by the govern­ment will aid its work­ing. A strong buy. Sona Koyo Steer­ing Systems trades at a crazy P/E of 57x. In­vestors be­ware of bull-run pit­falls. In­dian Oil Cor­po­ra­tion is likely to report bet­ter mar­gins this year. An at­trac­tive buy at the cur­rent level. Mahin­dra & Mahin­dra, which man­u­fac­tures elec­tric cars, will ben­e­fit im­mensely from the govern­ment’s im­pe­tus to the elec­tric ve­hi­cle seg­ment. It has also ac­quired Erkunt Trak­tor Sanaii (Tur­key) for Rs.735 crore, which is a feather in its cap. Buy. With TRAI slash­ing in­ter­net us­age charges, Bharti Air­tel and Voda­fone In­dia will wit­ness a dras­tic cut in prof­itabil­ity. It is ad­vis­able to stay away from this sec­tor till things be­come clearer. In­di­a­b­ulls Ven­tures trades at a frenzy P/E of 80x.

Think twice be­fore tak­ing a plunge. It is bet­ter to miss an op­por­tu­nity than to re­pent later. Oil & Nat­u­ral Gas Cor­po­ra­tion (ONGC) has made a 20 MMT oil dis­cov­ery near Mum­bai High. This can sig­nif­i­cantly en­hance its pro­duc­tion lev­els in the next two years. An ex­cel­lent long-term buy. Hero Mo­toCorp’s JV Mun­jal Kiriu has set up a new unit at Ahmed­abad to man­u­fac­ture brake parts for ma­jor au­to­mo­bile man­u­fac­tur­ers. A pos­i­tive for the com­pany. No­var­tis In­dia is con­tem­plat­ing a buy­back of its shares. The stock may rise by about 12-15% within a month.

Spe­cial­ity Chem­i­cal ma­jor Hi­madri Spe­cial­ity Chem­i­cal is per­form­ing very well. Ris­ing vol­umes sug­gest a break­out. Buy. Kar­nataka Bank wit­nessed a break­out after its an­nounce­ment of im­prov­ing its dig­i­tal­i­sa­tion process. It has brought down its sav­ings bank in­ter­est rates to 3%. CASA ra­tio is also im­prov­ing. A nice time to ac­cu­mu­late. Data­mat­ics Global Ser­vices, which posted ex­cel­lent re­sults for FY17, is con­tin­u­ing its up­ward march. The stock is poised to touch new highs. Buy for two years. Pin­con Spir­its is re­port­edly look­ing out for merg­ers and ac­qui­si­tions. This FMCG stock is worth ac­cu­mu­lat­ing. Or­chid Pharma has re­ceived the Es­tab­lish­ment In­spec­tion Report (EIR) from the USFDA for its API man­u­fac­tur­ing fa­cil­ity in Tamil Nadu. A pos­i­tive for the com­pany. Re­cently listed Re­liance Home Fi­nance, a break­away of Re­liance Cap­i­tal, is avail­able at Rs.104-109. The com­pany has great po­ten­tial. The stock looks at­trac­tive at the cur­rent level. Buy. Power Fi­nance Cor­po­ra­tion plans to raise Rs.65000 crore via a pref­er­en­tial is­sue on pri­vate place­ment ba­sis. The Chair­man re­cently stated that its NPA pro­vi­sions are likely to wit­ness re­ver­sals start­ing Q3. An ex­cel­lent stock to buy at the cur­rent level. Power Grid Cor­po­ra­tion of In­dia, which re­ported ro­bust per­for­mance in the last few quar­ters, has great plans go­ing ahead. A good buy.

Sin­tex Plas­tics Tech­nol­ogy looks good at the cur­rent level for a price tar­get of Rs.140. This plas­tic ma­jor may sur­prise the street with an EPS of Rs.9 in FY18 and Rs.11 in FY19.

Ori­en­tal Ho­tels jointly owned by the Tata's and the Reddy’s, owns var­i­ous Taj ho­tels across South In­dia. Peo­ple in the know are ac­cu­mu­lat­ing the stock on ru­mours of the Tata group buy­ing Reddy's stake at a huge premium to the CMP. Buy for quick gains.

Stocks of Tata group com­pa­nies such as Tin­plate Com­pany of In­dia, Tata Me­ta­liks, Tata Sponge Iron and Tayo Rolls have mul­ti­plied many times in the past one year ex­cept TRF. This equipment and ma­te­rial han­dling com­pany has shown an up­side momentum in the past few days. Also, mar­quee in­vestors like Nimish Shah hold a large stake in the com­pany. The stock could dou­ble.

Ador Weld­ing, be­long­ing to the Elec­trodes and Graphite Sec­tor, could wit­ness a rally sim­i­lar to HEG and Graphite In­dia. Buy this po­ten­tial blue-chip com­pany for multi­bag­ger re­turns. After ap­pre­ci­at­ing around 80%, Au­to­lite (In­dia) has cor­rected around 20% from its 52-week high. In­vestors can buy this stock at every de­cline for whooping gains in com­ing years.

IFCI has in­vited bids for a stake sale in Tourism Fi­nance Cor­po­ra­tion of In­dia and if ru­mours are to be be­lieved, all big play­ers in the hospi­tal­ity in­dus­try are in the fray.

An Ahmed­abad-based an­a­lyst rec­om­mends Akar Tools,

Ack­nit In­dus­tries and Na­greeka Ex­ports. As per the Astro-Techno view, th­ese three stocks may prove to be the multi­bag­gers of SAMVAT 2074. From his past rec­om­men­da­tions, Grauer & Weil (In­dia) hit a high of

Rs.72 last week (up 80% from its rec­om­men­da­tion at Rs.39.9 on 26 June 2017); Freshtrop Fruits hit a high of Rs.151.95 last week (up 72% from its rec­om­men­da­tion at Rs.88.25 on 10 July 2017); and Ul­tra­ma­rine &

Pig­ments hit a high of Rs.245 last week (up 41% from its rec­om­men­da­tion at Rs.173.65 on 26 June 2017).

The grey mar­ket premium for Prataap Snacks IPO is Rs.270-275; Ca­pacit'e In­frapro­jects IPO is Rs.140-145; and SBI Life In­sur­ance Co. IPO is Rs.3-4. ICICI Lom­bard Gen­eral In­sur­ance Co. IPO is trad­ing at a dis­count of Rs.2-3.

Astro Alert: In­vestors are ad­vised to trade cau­tiously with a strict stop loss from Mon­day, 25 Septem­ber to Wed­nes­day, 27 Septem­ber. Saturn/Moon con­junc­tion at trine with Rahu com­bi­na­tion could bring high volatil­ity.

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