Background: Asbestos Cement sheets are one of the most important building material (for real estate and infrastructure sector in particular) purely for their strong, non-corresive, weather-proof aesthetic nature. The industry till last year was not doing too well, but the late last year infrastructure push and more recently the real estate revival has initiated a strong revival in the sector. Shayadri Industries is one the leading players in the industry and has also launched a product that would include it the business opportunity of Swach Bharat Abhiyaan.
The Company: Shayadri Industries (SIL) was established by Mr. LB Patel as New Sahyadri Industries Ltd in 1994. The company is a part of the Swastik group, and is into the business of producing building material solutions and manufactures asbestos-cement (AC) sheets under the famous “Swastik” brand apart from anti-theft Doors, Flat sheets, Pre-Fabricated Building material and now modular Toilets. . The company has four plants across states and a new fifth plant is starting production this FY which is going to give a major boost to both topline and bottomline in the coming quarters. SIL also operates and sell power from its three wind farms which has a combined capacity of 23.2 megawatts.
Business: The company has a diverse product portfolio, SIL offers new technologies for metropolitan, urban and rural spaces in South Asian, Middle East and African countries and ofcourse india. The company has very strong brands in its space and enjoys a good and strong brand recall.
Products:
- “Swastic” : Swastik roofing sheets are manufactured from a quality blend of fibre and portland cement, using the most modern manufacturing techniques and the latest process control equipments. The AC sheets are ideal for roofing and side cladding of Industrial sheds, godowns, poultry sheds, houses etc.
- Modular Toilets: The company has more recently, added a very strong product in its arsenal in the form of “Swachalay”. Swachalay Toilet Blocks are modular in design, supplied in the form of a kit, and can be erected on site within hours for a comfortable and hygienic use by the residents. Made using Cemply fibre-cement sheets and doors and Swastik Roof, these safe, secure toilet units are ready for sanitary fittings to be installed before use. Swachalay are ideal for use in residential, school, tourist spots and inhabitants from the tribal or hilly terrains. The product is already very well received by the customers and given the government push for rural sanitation, this product could be a game changer for Shayadri.
- Flat Sheets – “Cemply” flat sheets are used in interior designs and in exterior use in industrial, commercial, and residential construction and finds application in False Ceiling, Partitions, Paneling and Wall lining, Cold Storage, Table top, Cable Trench Covers, Sign Boards, Back lining of cupboards, duct covers in multi-storey buildings, Kitchen Cabinets, Furniture, Storage Shelves etc.
- Entasafe – Entasafe is India’s first premium anti-theft main door and one of the world’s most advanced Main door systems. Entasafe doors are constructed from durable pre-treated steel, with elegant wood grain finish (FYI: in US and Europe approx 70% of residential main doors are steel doors). These are side hinged doors for putting directly to the brick work opening, hence very easy to install.
- EcoPro – EcoPro, which is a wood-free, light weight and asbestos-free alternative to conventional materials and asbestos products.
- SILBUILD – This is the “Pre-Engineered” Building solution brand from Shayadri that finds applications in Mass Housing, Low Cost Accomodation, Defence Housing, Educational / Hospital Buildings etc. With the affordable housing push and housing for all projects, this product should get another major push.
- Wind Power
Sahayadri Industries has set up 31 windmills in Maharashtra, Rajasthan and Tamil Nadu totalling to an output capacity of 23.12 MW. Indian Wind Power Association adjudged Sahyadri Industries Ltd.’s Wind Mills as “Best Performing Wind Farms” in the Years 2006-07, 2007-08, 2008-09, and 2010-11.
Valuations: This dividend paying company is trading at less than 0.25 times its FY14 sales and at 5.5 times FY 15 EPS. The company was facing trouble with its performance owning to extreme downturn in housing and infrastructure sectors but to counter it, it evolved itself very well. Firstly, it gave a huge thrust to exports (which were comparatively non-existent earlier) and secondly, it started evolving its product line to introduce high margin non-infrastucture related products. “Swachalay” is the first product launched under this initiative. The results are here to see. The company has given a strong turnaround performance in the H1 and is expected to continue the same in H2 and beyond. With the sanitation push of the indian government, the company is expected to bag major contracts moving forward. “Swachalay” has been received very well by the customers. With the dramatically improving bottomline, the dividends this year should also increase big time. Also, with the fifth plant becoming operational this year, the topline would increase substantially and the plan would also add to the bottomline, as the company would save significantly in freight charges. Also, with the decreasing debt, the company’s bottomline would get a further fillip.
Technicals: The company has given a strong multi-year breakout above 87 levels recently and therefore, on back of significantly improving fundamentals of the company, the upmove could be significant.
The company has evolved itself very well, and most of its brands are one the best in the respective area. The sanitation push of the government should give a strong push to the sales of “Swachalay” brands of modular toilets which is already very well received by the customers. With the Vijaywada plant coming on stream, the topline along with bottomline should get a major fillip. Last but very importantly, the company has decided to double the exports which should significantly improve the bottomline. The company in its interview to Businessline also mentioned about they being confident of “doubling” their exports as well as turnover this year. They have already delivered 50% growth in topline H1 YoY and considering the interview was given in the last week of Nov, management would clearly know what they have to do in the H2 and if they indeed come to anywhere close to what they are indicating, the growth could be tremendous.
Disclaimer: No holding in the stock, but it is safe to assume that I may or may not invest in future. Also, the above stock view is my personal view in individual capacity. For rest, please look at the About page.
aceinvestortrader 
screener shows P/E of over 100, is it not very risky
PE is wrong
Which screener do you use?
Is it free, if yes plz post the link
i have a custom screener
dear ace, when are you coming with next pick?
also is it ok to invest some amount in guj auto for long-term?
I am invested in simmonds, vidhi and freshtrop.
gujarat auto is decent but i think, simmonds is better between the two….
Already have enough simmonds.. so that means i can buy guj auto too…
thanks
if you have simmonds why you want to buy gujarat auto? diversify and get better stocks…probably could see prima if you do not have it already
Simmonds is not a transmission gear company both r different business.
I have a small transmission gear business and i understand it has wonderful prospect in terms of export and demand has increased and is increasing further.. For the same reason.. Prima too i have.. Forgot to mention
i know but still the sector is same and that’s what i meant. i do not think if you have simmonds you would need something like gujarat automotive gears but if you are so much interested in it please take your own call. I still feel having a good strong concentrated portfolio is better. you have very good stocks in your portfolio so keep it that way i would suggest. simmonds is very good so you dont need another automotive components company. if at all you want too much auto focus have an end product auto company …
by the way if you have a transmission gear business yourself, why do you even want to invest more capital into the same sector. i agree knowing the business gives you the edge but my investment take is a little different. i believe one’s finances should be hedged against sectoral trends at the same time should give good returns. so if one’s livelihood is based a sector, the stock investment in that sector should not be too high or your total finances (your livelihood and stock investments) are risked to sector trend…but then again..its just my investment psychology …
Hi Ace,
Ill give this company a pass as I am not a big turnaround candidate fan but just wanted to mention that you have spelled the company name wrong (not a big deal though)
Cheers!
Niranjan
thanks for pointing out… hasty typing …corrected it.
Advice me on PvP venture
Sir..Please correct the header, Its Shayadri should be Sahyadri… – sacbee
thanks….corrected it…typo
Welcome,,,,No Problem 🙂 sacbee
Hi ACE,
Would you rate it higher as an investment bet than market leader “HIL”?
i was hoping somebody would ask this question. More often than not, turnaround companies give better and faster capital
appreciation than established companies. e.g lets take example of v-mart Vs v2 .. v-mart an established, consistent profit
making company has generated not more than 150% but compare this with 500% returns of V2. This happens because of the mis-pricing (markets prices stocks at extremes, both for fast growing company and loss making ones) of loss making company. because its loss making valuations are already compressed and more importantly, it is dropped from the radar of bigger investors. So, when this loss making company starts turning around, the valuation expasion combined with dramatically improving earnings along with sudden increase in demand for this stock causes the prices to increase much faster. Once the prices catch up with earnings, its then the earnings that would dictate future appreciation. Normally, this is the most
consistent behaviour so to answer your question, if i have to bet my money i would bet on sahyadri. Also, their modular toilet is getting excellent reviews and should be an additional revenue generator for the company (this segment i am told has better margins too).
Thought so when u said it’s good
that was just a chance, dont take it as a norm i would suggest .. God Bless
Ace said he is very positive on Patels Airtemp also. As Ace said it should be just by chance.
Hi Ace,
Good Pick.,
Ace,
Whats your view for Kukoyo Camlin at Cmp ?
decent at declines
What is your view on AMD industries
amd looks interesting but its real estate arm is something that keeps me off limit here
Thanks Kamal,
Ace, It seems to be really interesting value pick.
Even the real estate segment started contributing 3 crores since last year and Last year consolidated profit crossed by H1, i think knowing this promoters increased their stake .
Hi, ur view on Prakash Constrowell and MIC Electronics, is it become multibagger in future?
prakash i am not confident as of now for mic electronics, lets hope it turnsaround… it would be nice to see someone standing against the might multi-nationals..
its a great pick…will buy in the morning itself
hi ace just thought of sharing…we met the management and he has indicated that this year, the EPS would be around 20rs, with they already bagging a few modular toilets contracts in the present quarter in gujarat…
Nice pick Ace
Dear Ace, when i order to buy this stock in Sharekhan, it shows the error message “In Group scrip buy not allowed”. I could not understand. Can you please help?
not sure buddy….call up the broker… this is what we pay these guys for… God Bless
Dear Baskar, I too have the same issue with Sharekhan… I called up the guy, he informed that the share is not qualified for online trading only offline trading could be done… which i really do not understand…. He informed that it can be done from Bombay Head office only demanded mail from me.. I sent a mail, waiting for order update… I do not know is this for only sharekhan or other brokers aswell.
do you track Indraprastha Medical corporation, if can be invested at these levels. Thanks for your hard work and efforts. God Bless !!
actually its not a bad stock, but i dont think it can give major upsides… scalability is an issue here….
Thanks Ace.. However if you look QoQ topline, revenues have grown by more than 20% in the last 2 years and 25% annually? Do you still foresee a problem?
but as far as i remember in last five years the bottomline has not gone anywhere… but still as i said its not a bad stock…good defensive stock, but also scalability is an issue here
Sir, in some of the industries, use of asbestos sheet are banned because of it being carcinogenic.Instead they are using non-asbestos sheeet which looks similar to asbestos sheet. I do not know whether this ban is Industries specific or it is banned by Govt. Can you put some light on it and what will be its impact on the business of SAHYADRI INDUSTRIES. Regards.
its is “not” banned by govt and also, for some industries where asbestos is not used, they have the product EcoPro as mentioned in the research report. Shayadri has been mindful of it and has already developed an alaternative to it…
Dear Ace, do you have any call on Richa Industries?
And also please give your opinion about PEB industry at whole, how do you expect PEB industry to shape up in the span of next 2-3 years expecting that Make In India is successful??
PEB is a very promising industry IMHO, and its strength,durability and time-efficiency make it ideal for so many industries especially for rural economy as mentioned in the report
Ace sir,
What is PEB ? Pl. elaborate.
Thanks & Regards,
just did ramesh…God Bless
sir your views on orient bell. thank you.
decent….
Hi ace,
Please provide your views on cigniti tech.
not too keen on it at the moment
Sir,
What hapoening in mkt today!is it only concern of global cues n fall in crude or something different?Plz …
global factors
Ace sir,
For benefit of other readers including me :
What is PEB ?
pre-engineered building…SILBUILD
Thanks ! So fast !!!!!!!
Dear ace ,your view required for shree hari chemicals at current level?
dont like the products of the company much
Prima Plastic has given decisions of Board meeting held today which is out in BSE notification. Awaiting your considered views on the developments on companies working results.please.
sorry, did not understand your question… i dont think they have declared any results…
they have declared closure of ACP division in a BSE filing (recently).. the company notes that there is an investment of 704 lakhs in this division… but this is the carrying value and not the value of plant + machinery that can be realised on selling right ?
any idea what % of this investment will be retrieved as cash after selling for scrap
well, also the brand value of aluma (ACP division’s brand) and remember investment is one thing but revenue is another but you know i would be happy with anything above 10% of their market cap as cash… thats a huge amount of money.. lets see now
i just hope that Q3 overall company performance has not been weighed down due to ACP underperformance
Q3 performance would be of little significance now as the main news is the decision to sell and next trigger would be the price
Prima Plastic has also stated that they have received Dividend of Rs160 lacs from JV Co Prima DE lite Cameroon. Also thanks for your jet speed top quality responses to all queries of your followers .
this is very positive news from prima..
hi ace,
with oil prices coming below 49$ how is that going to effect on the oil industries in india on the whole. And can we enter into any of those companies like ONGC,reliance,OIL at these prices
dont get into public sector companies as there’s still no clarity on the subsidy sharing… reliance the GRM would go down quite a bit…
Sir did u like vidhi dyestuffs at current level?
yes i like it
Is arrow textiles good
not too keen on it
Hi ace any views on aksharchem
aksharchem seems ok, but not sure as of now
Hello Sir..What is ur view on Suzlon..it is also in wind power and is biggest company in this sector in india..
dont like it much toomuch of debt and equity dilution will keep the prices in check
Hi Ace, ur view on Richa industries?
already replied on richa inudustries on the blog
Hi Ace, Prima is closing loss making ACP division and also got 1.6 cr dividend. what is ur view?will it boost it’s price?
yes, its very positive news fundamentally… bottomline would be strongly boosted.
Hi Ace, Ur view on Assam Company after ONGC deal?
the news is positive for the company
Dear ace what is your call on Rupa & Company and Titan Biotech?
first time visitor i am, and just saw the great work you are doing and the record of your calls is excellent.
rupa is decent but not exciting as of now. titanis ok..
Hi Ace,
How is that market is not celebrating the decision of sale of prima’s ACP division? even if they give it away for free, the ROE / EPS will increase significantly, am I missing something?
Also with the GST, theres a lot of tailwind…. not sure what would trigger the rerating…
Your views please….
Niranjan
the consolidated results and the actual sale of acp would trigger re-rating
i think the company might rake in max 1.5 cr from the sale of ACP division as just the machinery is being sold and nothing else. therefore, from next quarter we would get consolidated results + dividend income + 1.5cr approx from ACP sale
the ACP and MPA division plants are separate… im assuming you’ve spoken to CS (which I haven’t) so what do they intend to do with the ACP premises (since only selling equipment) ?
have they thought of anything or they will simply wrap up with ACP and then decide strategy ?
they will use the ACP premise for Prima’s own use. for other details, he did not wish to divulge on phone and have sent an email to him but importantly, its clear that they would use it for future expansion. So, in a way the fixed assets wont reduce i believe and thats one positive. some very minor work could continue in ACP till it is sold but the quantum would be extremely miniscule.
thanks a lot !
Thanks, just one question, will they incur any maintenance costs as they still hold fixed assets and only machinery is being sold?
if the machinery is not there the fixed costs would hardly exist isnt it..
hi ace,
according to Prima Q2 results, they have inventory worth 25 crores and cash in hand of 2 crores. now, they will have to sell this inventory first and since COGS allocated will be higher, we might not see positive benefit of crude price dip on margins even in Q3.
kindly guide if my analysis is incorrect. im still trying to understand balance sheets so please bear with me.
this is not necessary that all the old inventory needed to be booked in this quarter….it could be spread out…also, inventory would be dependent on the location so not neccessary that all locations would have inventory evenly spread out (nothing related to accounting).. lastly, till 2nd week of nov, reliance had held up the crude prices so as i had said earlier, q3 would not reflect the entire savings…next quarter would be the one to watch out for .
hello and good evening sir, I am new to your blog as i have gone through its Thanks for your lovely help. i realize company which doing some diffrence or unique in its product or having strong client loved by every one. Even though CUPID Ltd, ARROW TEXTILES, AMD Industries spread some investor attention . Sir do you find any investment opportunities in above mentioned company. Kindly advise . THANKS. GOD BLESS YOU
nothing as of now
Ace,
Do you prefer any company in Oil and Gas space?
Selan has corrected a lot recently due to crash in crude price. Your view on taking fresh entry in Selan at this level? It seems a value buy to me at CMP but don’t want to stuck for long in this scip just because it looks cheap. Your comments please
selan is good, but given what’s happening in crude i would stay away
Greetings Ace,
Pls advise me on Bilcare. Can we buy now but lots of debt scaring me.
thanks
abm
i am not interested in it as of now…. debt and lots of other things scary here
dear ace
pls share ur view on kwality ltd at cmp, valuation is looking very cheap and growth is very goods, roe 45% and sales growth around 50% for last 5 years with same profit growth, your advice is valuable for me so pls suggest
brand is but consistent negative operating cash flow is a concern
thanks ace, iam not went through cash flow, this is also very important point in analysing the stock
yes but it also depends on the industry so negative cash flows are not always bad…
hi Ace, i want to invest in Aimco pesticides and vidhi dyestuff as well but due to limited capital i can invest only in any one of them. which stock is the better option at current price and before results. thanks in advance.
split the capital between aimco and vidhi
Hi Ace, ur view on Arvind Remedies and Nectar Life sciences?
stay away from arvind for the moment and for nectar i have already replied on the blog
I did not find any view on Nectar life sciences, pls share ur view here?
kindly use google to search
anyways, its an average stock, not bad but still would say there are better bets here
Pondy oxide is it a buy, what would be d effect of demerger. If we have 100shares @ 50 will der be any change
not too keen on pondy
Is accel transmatic good stock to hold
dont think so
Hi ace..Tuni textiles is showing good signs of reversal..what’s your view?
haha.. this is a punter stock bro.. its probably time for the operators to help crooks make LTCG by taking share price up
tuni….the name says it all…not interested in it sir 🙂
ACE, how is Cosmo films for investment
debt is a little scary….
dear ace,ur view on fluidomat
decent…
Ace ji….qs is out of the context but I want to ask this to u…..its regarding Prima…in last two qtrs. the standalone sales are around 20 cr. each BUT the net profit is around 0.5L after all hearing that crude oil price is 50% , plastics, rubber companies must do well….BUT in these two qtrs. profit margin is only 2% which is Very very less…..so if this is the margin of this company then HOW can we expect it to make consolidated profit of 11 Cr. in FY15 (to make EPS of 10 for FY15)??????
And also I know it is optional to announce consolidated earnings in quarterly basis but why these kinds of companies do not publish them for the sake of the share holders so that we don’t get surprise(negative/positive) after seeing yearly consolidated result and no time to exit if its negative surprise…..by not doing the same we are walking in the deep dark road with just speculation which is very bad , after all we are not playing with our money…..
Disc : I am invested in Prima.
Appreciate ur detailed answers Ace ji on these two issues….Thx in advance!!!
God Bless U!!!!
1, the crude has come down in last quarter so obviously the effect could not occur in the first two quarters right? also, the consolidated numbers would dramatically improve the eps.2. consolidated numbers is an industry practice and in case of prima the cameroon JV has jan to dec FY therefore, its likely they do not give consolidated numbers. but then again they are not required to
Okay Ace ji….in that case it is only our hope that consolidated results will make EPS around 10 without any actual indication….this mean we investors need to hope/speculate 12months that consolidated results will be far better..if its not good by chance we will stuck….anyway Thx for the reply………
thats not the right way to think….be a scuttlebutt, and talk to dealer or go to plastic furniture shops and see how prima is doing. as far as consolidated numbers goes, try to research on cameroon’s business and domestic consumption climate and one can get an idea. One can always find ways to research if one really wants to…god bless
Ace ji…yeah agree to ur last reply….however it might be possible for full time investor or analysts…but for IT professionals , after spending 10-12 hrs for/at office work it might be difficult…anyway thx………
🙂 i understand….
At current market cap due like amrutanjan
its good at declines
Hi, ur view on DSSL Dynacons systems and solutions ltd?
not sure as of now about dynacons systems
Hi, ur view on Dynacons Technologies?
dont like it at th emoment
wts ur view on gulf oil lubricant..as crude is falling..it will be biggest beneficary…wts ur view
irrespective of crude i am positive on it.
Commodity, crude oil buying level?
not interested in commodities
sir, ur views on Akar Tools?
not confident as of now
Gul oil Corp and Gulf oil Lubricants, both are the same ? Plz clarify ??? Cmp 154
both different…..
what is your view on mahindra cie auto is it worth buying at current levels
dont track
what is yr view on mastek
no views as of now
what is yr view on 8k miles
good but at these levels dont know…. was very positive on it at sub 150 levels
what is yr view on pipavav & radha madhav corp & front line bussiness
have already replied on both…
Plz tell me , Whats ur view on Gulf oil corp
positive
Sir,
I see big opportunity in Lanco Ind which is now Srikalahasti Pipes.
This company is now Electrosteel group industry.
Revenues are above 1000 cr with leadership position in South India.
M cap is just 300 cr. D:E is 2. Debt is a concern.
Compared to other pipe manufacturers it is trading at a steep discount.
Profits are back and last 4 quartes has been very good.
It is at 5.75 PE. Good profits. Return ratios are very good.
Technically it is looking vey good.
Input costs and funds cost are/will come down and with thrust on sanitation the sales will be ok.
It has Cash flows to pare debt.
Dividend yield is nearly 2%.
All in all a big company at micro cap valuations. Cheaply valued, market leader, good promoters, promising sector, dividend paying.
The day it starts repaying debt there will be sharp rerating.
Regards,
ok
Ace,
Your views on Intellect Design Arena please ?
decent
Hi Ace,
Your view on viceroy hotel. R J is heavily invested in it. he holds nearly 15% of it.
not interested in it
Hi, ur view on Gravita India?
decent at declines
Ace sir,
I wanted your advise on Lanco Ind.
Please provide your input/insight.
Regards,
not interested in lanco
Dear Ace,
Rupa has grand brand value in mkt but its stock doesn’t reflect it.Can v think about this just like Videocon,as Videcon doesn’t like to pass the profit to share holders n his stock price is frezed..Is it same reason in Rupa?
the stock is already trading at 27 PE….why do you say the stock price is not reflecting it?
dear ace can i buy sks micro at todays price ,for a reasonable appreciation in a years time .
regards
maybe at a bit of declines…
Dear ace, ur view on KSS Ltd?
already replied
Hi, ur view on Godavari drugs?
already replied..
wanted ur advice on GIC Housing Finance and TV today…….. considering falling interest rates, thinking of buying GIC, but at the same time I would like to know whether TV today can be bought at this time…… what is ur pick between these two if u were to pick “ANY ONE” for long term.
both are different sectors…if you want to choose media TV today is decent, but GIC is average in its sector
View on eon electrical
no view as of now…though indications are positive…
Dear Ace.. Good Evening .. most of your recent reco are doing good .. Thanks for the good picks Also thanks for making my portfolio green…
Good Bless.
would like to know your view on archit organosys, they seems to have good product range, but could not find much about popularity of these brands
though interesting there are few unsettling answered questions here so i wont touch it for the moment
thanks for the quick response, would you please share issues you see here
sorry, my bad…unsettling “unanswered” questions..not answered questions…
Hi ace..your views on NMDC Pls?
not interested in it..why are you interested in nmdc..so much better bets available
Hi ace , did you have a look at 8k miles results , what is yr opinion on the scrip after the results
at these valuations i am not interested in it… only if you were holding it earlier you should hold…
Ace,
Your view Sarup industries. Do you think at these level we can add some stocks of waterbase , aimco ,freshtrop fruit ,vidhi and pressman..or should we wait for more correction.
Kindly give your call.
Thanks
Anuj
given that these stocks freshtrop, aimco and waterbase have already given multiple times returns, you should take your own call thought for long term positive… ditto for pressman and vidhi… all are very good stocks in long term… sarup..i have already replied multiple times on the blog..kinldy search for the same
Ace
I totally agree with you that these are very good stocks. I have two questions for you
1) By long term here you mean 6 months or more than a year.
2) All these stocks have rose multiple times since your reco and then fallen a bit and have taken a level like Aimco at around 70 , waterbase around 57 , freshtrop around 115…so i would like to know is it like these stocks are consolidating waiting for the 3rd quarter results…and if so what you think they will go upwards or downwards…
Thanks
Anuj
even by trading bets are 4-5 quarters long so long term surely means 3 yrs plus…
2. how can anybody know for sure if the stocks would go up or down but overall fundamentally these stocks are very good…
Hi Ace,
Your views on Syncom Formulations. Pls guide.
Regards.
not interested in it…
Hi Ace,
Whats ur views on Talbros auto and gujarat foils?
talbros auto is decent but like simmonds a lot more…gujarat foils is a little dicey at the moment
Why not Rushil Decor, or Beardshell are better choices than Sahyadri at current prices ??
rushil is not comparable with shayadri…for beardshell this is not the right time…
your view on orient beverages at current levels as it has fallen from 226 to 127.7 today and now reversing and is now up 4% yr long term view
124-134 is strong support… if you are ok with high risk investment, this is ok,
Also based on value investing approach – I found these stocks
1) Makers Lab ( my favourite – extremely promising… adding approx 3 crores profits this year on a market cap of 20 crores , an impeccable management,limited floating stock).
2) Austin Engineering 3) Pacific industries, 4) Sanjeevani Parenteriles 5) Cosmo Films 6) KLRF
are available at dirt cheap valuation. Wat is the reason one should or shouldnt buy them.
On Growth & innovation based approach – I found 1) Multibase, 2) Axiscades and 3) Marico Kaya very promising though expensive.
Do you suggest to enter all these companies I have mentioned?
makers and cosmo i have already replied..austin is interesting…thought dont like pacific and sanjeevani much… last three again i have replied a lot of times.. would appreciate if you could kindly search the blog and if still any questions, we can take it forward
please ignore my last question on Sanjivani. I dint check the date. This was Jan-15 and not Jan-16.
right.
whats ur views on Nelcast ?
its interesting bet in its sector
Hello sir.. I am from west bengal and have been following your blog since last 2 weeks.. Congratulations on ur past success..
Since most of ur recos have already shot up, shall I wait for ur next report before investing? If not which company is still an attractive bet at cmp.. Please name the company as I am really looking forward to start my investing journey.
Best regards,
Sushmita Saha
there are a lot of stocks that you can buy even right now…you can choose from any of the mentioned stocks but if you feel psychologically jittered because of price action you can wait for new recommendation..God Bless
Thank u sir.. the prompt reply is worth appreciation.. can u pls name two stocks that can be purchased at currnt levels.. m,e being a newbee am having a tough time to decide..
rather than taking a blind take, i would suggest you to atleast go through the blog and different stocks that i have advised and choose 4-5 stocks and from them i can help you to narrow down to two stocks that you could buy…take your time reading the blog…there’s no need to hurry into anything without understanding the business.
Ace,What’s your opinion on V2 Retail? Any changes in the company basics? Is it worth a consideration at CMP?
dont see any change in fundamentals….IMHO “technicall” the present levels is a good level to enter
Sir.. I had chosen to park my money at prima, sahyadri, pressman, vidhi dyestuff and simmonds.. having a really tough time to boil down further.. Thank u so much sir for guiding me so personally..
you have chosen i would well. i hope you have alteast a couple of years of perspective… its difficult for me to give a pick because that would suggest i have a bias on the suggested names but you can plan to split your money among these companies..
Sir.. I think this is what is called luck.. while we were discussing simmonds.. it shot up by 10%.. anyways hard luck for me…
Sir could u just tell me if the above mentioned companies are trading at attractive prices.. that would be more than enough for me.. 🙂
yes they are trading at attractive valuations….
kindly share your view on Alstom India?
positive on it
so fast! Thanks
Sir why Prima is lingering around 55-60 level. Sir just for my and everyones knowledge when the journey will start. In other words what is the trigger point to prima. Sir pls share your view on suzlon energy at current level.
not worried about everyday price movement. all i can say is the fundamentals are only improving by the day so would suggest to track the business not the price. when it flies, it might fly fast and hard given such strong consolidation
Sir i have been reading your blog regularly from 2-3 months.But since was waiting for funds wasnt able to invest .
BUt i would like to ask you the stock which has the potential to be a multibagger or please rank them as you belive in all but still your favorates-
1) Prima 2) Simmond marshall 3) V2retail 4) wanburry 5) cybertech 6) Sahyadri 7) Pressman (not rankings)
(well i know ranking them is stupid question but please just rank as your preference) and also mention if you can that if i can wait 1-2 months for any particular stock. .
If you would like to include any other stock in these please include.
But this will greatly help me in investing.
all are good choices that you have mentioned…
I see that many people here have forgotten about Waterbase. Waterbase has corrected very well and now waiting for a trigger to blast its way through. I believe Ace and many others, would agree with me on this.
true …
Need your views on Confidence Petroleum & Southern Online Bio Technologies. Currently nothing interesting in their results but going ahead can these 2 companies scale up their business and be leaders in their sectors?
dont think so at the moment…
sir i would like your view on LT foods .
its an ok kind of stock… the stock has balance sheet tailwinds
Ace
You views on Fluidomat and Kesar terminal and Gabriel india. I know you have replied on these stock previously but my question is more from how scalable their business are and will their ROCE will increase in coming years.
Thanks
Anuj
given the nature of businisses may i ask why are you focussing on RoCE and not RoE?
Ace,
Just my investment strategy i would say…for my core portfolio i usually make sure the ROCE of the company is increasing in the last few years and also will grow in near future.. but can i ask you why you think these businesses should be measure more on ROE than ROCE… and please do tell what you think about these business on ROE basis 🙂
Thanks
Anuj
sure, and my point was not why RoCE and not RoE but as a personal bias i never use either of these two in isolation. i like to see both RoE AND RoCE though for asset light businesses like IT or outsourcing companies RoCE may be better or for infra companies RoE is considered better but IMHO, these two in isolation “may” not always give the best picture..
Also please note ROE can be played with ..but yes for these companies ROE can be considered as they have very low or no debt 🙂
right, there’s an interesting debate on this blog somewhere between RoE Vs RoCE , see if you can get hold of it and you might understand my views 🙂 … but as a personal habit/bias i see both and neither one in isloation.. infact these all things could be combined with cash flows to make a better assement… as you rightly pointed out that RoE could be inflated (though played with would be a strong word ) but even RoCE could state an incorrect picture if not seen with the cash flow statements…isnt it… but anyways, these are debates that can go on and on and on…
what is yr view on kansai nerolac
i am positive on it.
sir i have selan exploration from a very long time…should i now sell my holding..though i am bullish on the stock..
the stock is very nice..wonderful business with excellent management…though the tailwinds are there currently in the business but if you do not have any particular compulsion to sell, think twice before selling this wonderful company
Do you think crude oil price would effect this selan’s this quater negatively and thus a correction?
it seems markets are convinced about this theory..lets see now….results are round the corner
Hello Ace
Deccan Gold is quite buzzing around these days. Your take on it pls
Rgds
probably its the expectation on gold minning reforms but for the moment i would stay outof it and think after actual receipt.
sir if walchandnagar were to be broken into different companies would it be good the company and shareholders…
this it should be positive for the shareholders..mostly value-unloacking almost always is…
Ace, any thoughts on Polaris Ind? Seems like after the demerger everyone has been chasing Intellect Design hoping its going to be the star performer and getting the money out of Polaris. Many thanks SH
well, polaris ind would be just another consulting firm..as even i had mentioned earlier its product division would be a better bet as it has non-linear revenues..i would also be interested more in that than polaris ind..
Thanks Ace.Given Hoping IT companies would deliver better results this quarter (Infy has set the tone) and rupee depreciating in Q3 qtr, would it be prudent to hold polaris through the earnings or coming out earlier than that? thank you
never felt very comfortable with polaris with their IT services division but dont just go with my comment. you should take your own informed decision because i dont track polaris very closely
Hello sir.. hope u r doing good… what is ur opinion on amd industries and jayshree tea.. waiting for new insights on the above mentioned stocks… 🙂
jayshree is ok….for amd i have already replied multiple times
how is polymedicure and rubfila for long term
polymedicure is very good …rubfila is also decent but remember its heavily influnced by commodity prices
Dear Ace,
What’s your views on Godavari drugs? Is there any special news for its regular UC?
no idea of continious UC….the results were pretty good for Q1… if there’s achange in trend then it could prove to be very undervalued and possibly that could be one reason…still at current valuations its discounting a lot of good news…. so for fresh investment i would refrain till i see the results..
Whats your view on Kaveri seeds? Is it wise to enter at current market price ?
you could enter at the CMP or wait for 5-10% declines..but entering at CMP is also not bad
Sir, Ur view on Saurashtra cements and Mindteck India?
saurashtra cement was once a punter stock…rather than mindteck i would prefer cybertech at current valuations
plz share ur view on Career point !
it looks to be turning around the corner, but one could also look at mt edu from this sector
Hi Ace, please share your views on South Indian Bank and JK Bank. Good to enter at CMP or do you see market correction in Jan?
both good…but one should be careful to see the book quality of j&k in the aftermath of floods in the state…
Thanks for such a quick reply. So both these banks are a buy at CMP? How do you rate GSFC?
j&k would probably look at quality of book before taking the plunge…south indian probably at around 15% decline…GSFC is decent …
Ace, how are you? What’s happening to V2?
what happened? Any news? not aware of anything wrong…do you have any update?
hehe, i meant in terms of price action. I did not find any news related to business change. can one buy v2 at cmp then?
no change in fudamentals that i know of. 35-37 is strong support and would be very surprise if it were to close below it. yes one can think of buying at these support levels but one questions, i hope you are diversified beyond v2…basically you have only asked me about v2 so a little concerned… have a concentrated portfolio but that does not mean just one stock…hopefully you are following that my friend….
yes, i have some other laggards like jp associates and suzlon. No point in asking about those 😦
Why is the V2 retail website always down?
not always but yes as of now as you rightly pointed its down
lol, true… and u know, once V2’s website was hacked by a pakistani hacking group. This happened i think around august 2014. When i typed V2 website address, there was a message by this group that the website has been hacked. i found it funny.. lol
I hope the hacking group did not steal any of V2’s inventories.. hehehe… i think they did not, V2 has been posting good set of numbers last 2 quarters! lol
Advice me on DCM sriram
sorry, not tracking it
Is it good to buy Danbury at the current price
Wanbury
i had written sometime earlier that it was a good level to average if you are convinced about business and have patience of few quarters… approx 25-27 rs is a strong support technically and so far its proven to be right..around that level one could consider averaging.
Ace ur views on indo Rama synthetic and orient green
indo rama is average and would say that there are better bets available and orient green i am not too keen either as of now
Hi Ace,
Will appreciate your views on Godarvari Drugs, since company upgraded its plants, the result are amazing. Sales & Profit are growing briskly, generating good cash even the OPM is consistent.
In the last 2 quaters, company sales are 22.18 cr, hence co is quoting at 2x sales for Half year.
Management is buying the stock aggressively, plus the stock deliverable is 100% since about a month.
Issues,
No Dividend.
Increasing Debt.
Regards,
Vasim
its the last quarter where the results were suddenly good as far i know….if the performance is repeated then there could be substance to it….also the stock is in t2t and therefore, delivery has to be 100%….but having said that, as mentioned ealier, i do think stock is turning around because as far as i know the product mix is improving…
Thanks Ace, Yes – the last quarter was suddenly good, but even the last to last quarter was amazing.
Thanks for reminding me how dumb I’m for thinking 100% deliverable as something big.
oh no, thats not dumb…infact you were looking at the right indicator …it just so happened that since it was in t2t the delivery would always be 100% … but delivery is an important factor… sometimes we tend to miss the stock group but thats not being dumb… dont be so harsh on yourself 🙂 ..god bless
Dear ace sir can u pls share ur views on skm eggs, Lincoln pharma and celestial labs. Thanks in advance.
positive on first two
Dear Ace, thoughts on Dhanuka agritech? Good to enter at CMP? financials and promoters stake looks solid.
yes it a good bet for long term
hello sir what is your view on jagaran prakashan and akshar chem as long term investment ?
both decent…
Hi, ur views on Bharat Seats and Bodal chemicals?
bharat seats is fine and bodal i am not interested
Dear Ace, what is your view on gujarat automotive gears ltd in the long-term?
hello sachin, i have already given my positive views on this company quite frequently in the past three months… God Bless
Great sir, i am a new reader, didn’t know about it!
thanks a lot
no worries
ace ji, how should one calculate a fair p/e?
for e.g. one stock is trading at 5 P/E without any debt and others in the same business but bigger companies are trading at 40 p/e with debt.
and the 5 p/e company have plans to do better and business prospect is in no clouds, and other factor like promoter holding pledge too is all good then what should be fair p/e of this example company?
unfortunately there’s no specific formula or guidelines… there are examples where a growthless company may trade at 30-40 pe whereas a growing company may trade at way lesser PE, but with time, if the performance is wonderful, management is ethical, and shareholder value is enhance, this lower PE is graded higher…
it might also mean that the growthless company trading at 30-40 pe has become an defensive bet, But my question is when comparing a micro player with a giant player by use of P/Es how much re-rating can it get to? If a 20 crore annual sales company is competing with a 500 crore sales company, and in next 2 years the 20 crores becomes 40 crores.. while the 500 crore gets to 650 crores… THEN what p/e does the smaller company deserve?? I am asking you your opinion as you have knowledge about fundamentals, i know that there is no fixed way of looking at these things but i want to know your way of looking at this.
i am playing blind here. till i know the fundamentals how can i comment on PE? by the way in your example the bigger company would still continue to command 30-40 PE because of good growth that it has seen…. as i said PE is not just a derivative of one factor…
yes so, product pricing and fundamentals are same the size of company is different.
Then?
i am loosing context here man…. cannot comment till i know what i am talking about
this is not about a real company, its a hypothetical question sir.
you said the bigger company will continue with 30-40 p/e due to growth but you did not say anything about the smaller company’s growth which doubled, if 30-40 p/es will continue for the bigger company please give a rough idea on what you feel about the small company p/es ?
if everything is good, then the smaller company will also improve its PE and market would determine how much based on other parameters that we know of
What other parameters?
let me ask you this…what other parameters you think the market might value a stock
Hi, Saurastra cements reducted the debt drastically from yoy, is it turnaround story?
not sure
Hi Ace .. your opinion on “Ruchira Papers” for investment is appreciated , if u are tracking it .
Thanks,
a lot of paper companies along with ruchira looks decent…
Hi Ace,
Good news for Freshtrop Fruits. Lets see how this materializes and how much market they can capture.
Updated IN Economic times today:
Grapes to be the TOP AGENDA in AGRICULTURAL SECT- Obama meet
Also update in Business standard –
removing the link… no wonder freshtrop is in UC
ACEji,
I wonder why no one talks about FF, it just refuses to go down every time there is correction . It was at < 120 for quiet long time and then sudden spurt . This is one of the strongest stocks you recommended .
I am sitting on cool 155% gains ,thanks for a wonderful recommendation .
Regards,
Prashant
do you track Prozone? if yes pls share ur views. thanks
prozone not confident for the moment
Is it good to hold bharat gears
i would reckon so…also one should strongly look at simmonds too
Hi Ace, Can Orient Bvg. be bought at current level ?
as i mentioned yesterday in comments, 127-134 is a strong support….one could buy at around those levels ideally
ACE while trying to find unique product companies came across 20 microns, whats your view.
all important ratios are bad, but how is future?
20 microns at one point was very promising but it faltered… i know its the largest producer of white minerals( till a few yrs back i was an investor here), but it has its own challenges and for the moment would stay out of it
Dear ACE..what is your views on Munjal Auto?
positive
Cera sanitary ,price 1850, P/E 38 , Can we invest at these levels ? Target being given 10,000 by some experts ! Plz suggest , thanks
dont know about targets but as i had mentioned earlier, i am very positive on cera…you can buy on declines
View on dhana laksmi bank
not positive at the moment… but keep it under watch
Sir ur view on Axis cades at cmp ..its looking good having great mgmt…..also in defence.
any negatives from ur side
already replied on it on the blog…
plz provide link ..i couldnt found in search
google search also couldnt provide
Dear Ace,
What’s your views at present on Force Motors after its pull back from Rs 1000?
My investments doubled at this juncture. What can I do? Book partial / full profits or hold?
force is decent.. i dont give any sell calls here… pls use your own convicction on that…one could also look at sml from this sector
Sir but Sml is trading at very high PE and valuation wise also as compared to FM.
sml is turning around its operations very well. higher PE is because in some quarter there was also loss. also i did not say force is bad…i am just saying one should also look at sml…sml has a better product mix for the aspiring rural buyer. also, its good decent return ratios
I am a very long term investor.
not even a single post regarding the sahyadri industries in the thread.., surprised
there are actually… just read the comments… and as soon as the stock starts moving suddenly people will realize that they have missed the bus and then they will start chasing it…a few stocks have shown such characteristics and then when they move they move big.. anyways, no wonder not everyone makes money in markets..isnt it my friend… God Bless
well said but i haven’t missed.., i’m on board
Ace, Did you read through The Hindu chennai edition today’s paper, the Poonamalle Municipality has allotted GIS mapping work to Cybertech and this is the first of it kind in Tamilnadu and project is expected to be replicated by Chennai Municipality as well.. Cybertech is indeed a multibagger in this era of smart city.
no amin, i did not find that news, can you pls post it here for the benefit of readers…
Poonamallee area to be GIS mapped
Jan 13, 2015 12:00 AM , By K. Lakshmi
As part of its efforts to improve administrative efficiency and create more green cover, the Poonamallee municipality plans to carry out GIS mapping of its area in a month or two.
Initially, the 4-km-long stretch of Poonamallee Bypass Road will be mapped. The municipality has appointed a consultant to carry out the GIS mapping project to build a database and develop a green belt along the arterial road.
The project will be extended to other parts of Poonamallee, which has a population of over 57, 000. A number of features, including domestic and commercial properties, roads, ponds, stormwater drains and water facility, will be covered under the projects.
Officials of the municipality said besides revenue generation, this will also help in planning projects to improve green cover and rejuvenate ponds in the area.
“We will soon hold a meeting with industries to zero in on the other projects such as parks and water bodies that could be taken up for maintenance under corporate social responsibility initiatives,” said an official.
In a bid to make Poonamallee greener, the local body proposes to plant 50,000 saplings in public spaces and government buildings.
i saw this news online but where is cybertech mentioned here…?
After reading this article, I spoke to my friend in nearby area who is an advocate to the Poonamalle municipality to check out the company in proposal to take up the GIS mapping. And as I expected, it was Cybertech.. The news would be soon official.
ok. will try to see if i can get any info from the company
Great…
I read your analysis on sahyadri. I feel its an excellent stock. The half year Fy15 (june and Sep14) EPS is already Rs 10 and I feel december quarter will give around rs 6-7 EPs and March quarter will give 9-10+ so full year Fy15 will be somewhere around 25-27 EPS. The good thing is a healthy cash flow from operations and due to which the compnay is repaying the debts last year and this year also. I think by the end of march 2015 30-40 crore of loan will get repaid. Already the interest paid has been reduced by around 25% in the last two quarters which shows that loans have been repaid. I am pretty sure that In Feb 2015 you will write an article with this heading ” Sahyadri doubles in 2 months. If the results on 27. jan 2014 gives EPS of 6-7 or little above then 160+ in Feb is sure sure. Thanks again for this great pick.
Sir, Can you share your view on Sahyadri Industries q3 result. Regards.
where is it declared ?
What analysys you are doing ? Sahyadri declared result 15 days back and now you are asking where it declared !
🙂 atleast look at the date and time of post brother…
Kiru, Kirk, Kirk…be nice
topline growth is 23% YoY, but stock in trade along with power generation business has taken a toll on the bottomline, and in loss, this is disappointing a bit. though company has posted a cash profit which is very encouraging. lets keep it on our tab
Hi ACE. Should we average now, or need to wait for next quarter results?
its not even down 15% from its price so its not right to average. also, its holding its support levels and have taken quite a bit of selling so far. let it settle
sir your view on camson biotech?
no change in from my previous views
Hi, I was waiting for some correction like this to enter into Sahyadri. Do you think the result will impact further correction again in next week. Keeping in mind technically RSI is also oversold.
cannot comment on price action but i believe its attractively valued right now and any decline could be used for adding
Dear ACE investor,
I am first time your blog reader and stock market i want few investment tips for long term.I want Ten baggers stock tips value will be cheap.
congrats… you have started your journey towards serious wealth creation. Once you get investment “tips” from some blog (here nothing like this happens though) on ten baggers and you have lost 90% of your money in those tips, you will suddenly get educated and then….yes then you will slowly but surely get wealthy… and you would be amazed that this theory works everytime.
Thank for reply.I want wealth creation and my portfolio will be multi fold.Can i buy Sahyadri Industries and Neo corporation.
if you have researched the company and understood its business then you would know the answer to this question. I dont spoon feed here.
Ok