stocks to watch

1. bocindia
2. vadilalinds
3 jindal poly
4 sunil hitech
5 igl
6  ascl

Lumax Auto Technologies Ltd

Founded in the year 1981, Lumax Auto Technologies Ltd is a part of the D.K. Jain Group of companies that has carved its strong position in automotive parts like sheet metal parts, fabricated assemblies, tubular parts, for two wheeler and three wheeler industry. Under the aegis of Mr. D K Jain, today Lumax Technologies has captured sizable market in its arena with an annual turnover of over Rs. 400 Crores (US $ 89 Million) including its subsidiaries. 

it has an equity of 13.63 and 626cr turnover( consolidated ) and net profit of 45.51 cr. (35.23) eps and given 60 % dividend buy at cmp 170 rs for a target of 200 in next 3 months .

http://www.bseindia.com/xml-data/corpfiling/AttachHis/Lumax_Auto_Technologies_Ltd_280511_Rst.pdf

Sandur Manganese & Iron Ores Ltd (BUY AT C.M.P 550.00)

Sandur Manganese is a mining company, which is involved in the mining of manganese ore and iron ore. Mining companies of late, especially from Karnataka, Till 2008, this company was mining about 700 hectares where the results were about 5 million tonne of iron ore and 18 million tonne of manganese ore. Thereafter, the company got clearance to develop further and as on today the total area being mined is about 2,000 hectares up from 700 hectares. The total reserves of iron ore are 50 million tonne and manganese ore is 25 million tonne.

Sandur Manganese & Iron Ores Ltd

The promoters are holding close to 75% in the company, which is a big positive as far as I am concerned. The company has got a 74% subsidiary called Star Metallics. This Star Metallics is into ferro alloys. The company has invested close to Rs 110 crore in Star Metallics and the investment has still not started yielding returns because Star Metallics plant is not operational.”

“The company’s captive power plant of 32 megawatt is going operational in September of 2010, which will make Star Metallics’ ferro alloy plant operational. Which means that the investment of Rs 110 crore with the company made in Star Metallics will also start yielding returns from next month onwards. You have a mining company, which is available at extremely reasonable valuations. There are short-term concerns regarding mining restrictions being imposed by the Karnataka government and also regarding restrictions on movement of iron ore.” 

IT HAS A EQUITY OF 8.75 CR AND COMPANY POSTED 91.68 CR PROFIT  FOR FULL YEAR  2011 . CURRENT MARKET CAP IS 481 CR AND DEBIT FREE COMPANY AND HAS 169 CR CASH ON BOOKS  . CURRENTLY COMPANY TRADING AT 5.7 P.E JUST BUY FOR A LONG TERM INVESTMENT

AVT Natural Products Ltd.

Why AVT Natural Ltd. demands a place in one's Core Portfolio ? :

1. Two of the three operational segments of the company (Food-Grade Marigold Oleoresin and Spice Oils & Oleoresins) have surpassed the immature stage which will see a multi-year demand boom starting from 2011. The third segment (Value Added Beverages) is still at a nascent stage but is bound to grow two years hence, once the decaffeination plant (one of the only three in Asia) set-up by the company fully stabilises. The new related segments in which company is entering now (Phytochemicals and Soluble Beverages) offer tremendous potential for growth.

2. Company has a World-Leadership status in supply of Food-Grade Marigold Oleoresin.

3. Is the only company in the world which has a large production-base in two (India & China) of the only three major countries (India, China & Peru) that supply marigold and so is the first preferred choice as a reliable supplier of marigold which is evident from its exclusive tie-up with Kemin Industries Inc. (one of the world's largest consumer of Marigold Oleoresin) and Chrysantis Inc.
4. Is world's only player in marigold industry which has own cultivation as well as processing facilities.
5. Is a rare end-to-end player in marigold market with in-house development of high-yield hybrid-seeds, firm contract farming arrangement (one of the largest in India) as well as own plantations for growing marigold, certified extraction plants to extract food-grade and feed-grade oleoresin from marigold and exclusive agreements (is the only supplier) with world's leading consumers Kemin and Chrysantis for the offtake of entire produce of marigold oleoresin. Hence, the only risk left with the company is the weather and therefore production risk which is very well mitigated by establishing large cultivation-base (production-base) in two countries viz., India and China.

5. Kemin, AVT's largest client, has last month (April 2011) launched an aggresive multi-million dollar promotional campaign (second in its history and that too after a decade) with renowned celebrities like Lolo Jones, Emme, Aaron Scheidies and Jennifer Galardi to aggresively promote its FloraGlo Lutein brand for eye-care ahead of the release of AREDS-2 Study in 2015, to enable the brand to reach the annual sale figure of 100 mn. US$ by 2014 from current 50-55 mn. US$. In addition, Kemin has, in March 2011, started a personal care division in which it plans to use its FloraGlo Lutein in the formulations meant for skin and beauty care. These developments augur very well for AVT Natural as it has an exclusive agreement with Kemin wherein Kemin has to procure all its requirement of food-grade marigold oleoresin for production of FloraGlo Lutein from AVT only and so the business from Kemin is bound to rise exponentialy for AVT in the years to come which is evident from the robust financials registered by AVT in Q3FY11 & Q4FY11.

6. AREDS-2 Study (a major clinical trial sponsered by US Federal Government's National Eye Institute), which is closely watched and is followed by almost all the leading Ophthalmologists around the world as well as Pharma & Nutraceutical companies, is likely to release its findings on intake of lutein and zeaxanthin on prevention of AMD (Age-related Macular Degeneration – which affects more than 30 mn. people worldwide and accounts for more than 50 % of blindness in USA) in the beginning of 2015. Based on the progess done and the reports generated so far, it is almost certain that lutein and zeaxanthin will be given a prominent place in AREDS-2 study as they are actually found in high concentrations in the macula of human eye. Once this is done, the demand for these carotenoids (lutein and zeaxanthin) will rise exponentially which will significantly benefit AVT Natural as Food-Grade Marigold Oleoresins are the richest source for extraction of lutein and zeaxanthin and AVT is the world's largest supplier of the same.
7. Spice Oils & Oleoresins, the other operational segment of AVT is also experiencing a demand boom because of two reasons – first – Because of the steadily growing demand from the domestic as well export markets due to their varied uses in confectionary, noodles, beverages, sauces, canned meat, soup powders, curries and poultry products, and --- Second – Because of the increasing preference for quality products in each of the user-industry, use of spices is rapidly getting replaced with oleoresins and spice oils. Both these facts are validated by the recent Indian Spices Board report which states that “in 2010-11 fiscal, a significant feature of spices export was the rise in shipments of spice oils and oleoresins. They made up over 15 % of the export basket.”. AVT, being a significant player in this segment (almost second to India's largest exporter in the category – Synthite) with a wide-spread customer-base numbering more than 80, is bound to exploit the opportunity of demand-expansion in the segment fully.

8. The third operational-area of the company, Value Added Beverages, for which it has set up a Decaffeination Plant at Vazhakulam, Kerala (present processing capacity is 7 mn. kgs which is one of the largest in the world), learning phase has already concluded and stabilisation started which will see a significant rise in volumes going forward. This segment of AVT is again a niche one, because there are only 20 odd companies in the world who provide Decaffeination facilities out of which only two are located in Asia, Nine in Europe and Four in USA while others are located in Brazil, Mexico and Colombia. Major Beverage companies like Kraft and Sara Lee have their own Decaffeination Plants but most of the other beverage companies (including Unilever-Lipton) around the world outsource their Decaffeination requirement via what is called as toll arrangement wherein they provide tea or coffe to Decaffeinators (like AVT) and pay a fix processing fee. This is because, to set-up and maintain a Decaffeination plant, it requires a lot of capital and skill and so not many companies venture into this business. However, beacuse of health consiousness, the demand for decaffeinated beverages is, of late, robust, in both, developed and developing countries, but price is the major constraint hampering thier demand. Asian continent, especially China and India, are the obvious choices to outsource the Decaffeination requirement at the most competitive cost and this is evident from the first Decaffeination plant in Asia becoming operational in 2007 in Vietnam, only 2 years before the operationalisation of AVT's Decaffeination plant in India.
9. Finlays, the largest independent tea trader in the world trading more than 100 mn. kilos of tea each year (also one of the largest producer of tea producing 45 mn. kilos of black tea each year), has chosen AVT for outsourcing its Decaffeination requirements w.r.t. Tea. It has entered into a toll arrangement with AVT till 2013. It is worthwhile to note here that Finlays already has an in-house Decaffeination plant in Hull, UK where it decaffeinates almost 3 mn. kgs of tea each year at present, but the demand as well as the need for offering Decaffeination at competitive rates is such that it has decided to outsource the Decaffeination requirement to AVT and this itself is the vindication of positioning of AVT in the space.
10. Alongwith Finlays, AVT counts amongst its clients Harris Freeman (which through its division Harris Tea is the largest Own Label tea supplier in USA) in Decaffeinated Tea space.
11. Company has a clean management being a group-entity of AV Thomas Group (69.6 % Promoter Holding + 4 % acquired on 6^th May 2011 via Open Market Purchases at the rate of Rs. 150 so present promoter holding is 73.6 %) and is headed by a professional management under Mr. MSA Kumar (ex-vice president Shaw Wallace & former Chairman of CII Kerala).
12. The company has grown its topline at a CAGR of 20.6 % and EBITDA at a CAGR of 5.3 % over last 5 years. This growth was achieved inspite of the company being in a learning-cum-investment phase (expanded capacity via addition of another extraction plant and added a capital intensive Decaffeination Plant) which depicts the bottomline-focussed approach of the company. If one analyses the balance sheet of the company closely of last 3 years, then we will find that the company has expanded heavily on assets front with no significant rise in topline as well debt-to-equity. The first part is quite easy to understand as normally the plants like these take atleast 1.5-2 years for stabilisation and therefore any meaningful contribution from them can be expected only after that. However, the second part of the observation is really commendable as the expansion is done without burdening the balance sheet with debt as also maintaining the profitability level and dividend payout level (35 % and 30 % in FY08, FY09 & FY10).
13. With expansion already done and the stabilisation occured in all the three operational segments, going forward we can see a healthy topline growth, a glimpse of which can be seen in recently declared Q4FY11 results wherein company has attained a 101.5 % jump in topline YoY and a 105.6 % jump in PAT YoY.
14. Company has maintained an average dividend payout ratio w.r.t. PAT at healthy 32.15 % over last 10 years which speaks highly of the management's concern towards the return of its shareholders and based on the expected FY11 dividend, the company is offering an attractive dividend yield of 3.5 % with a significant growth opportunity for the capital invested.
    At current market price of Rs. 145, AVT Natural is available at a p/e of just 10.03 on declared FY11 EPS of Rs. 14.44 and at a market-cap-to-sales of just 0.75 on FY11 reported topline of 147.02 cr. If we look ahead, then based on FY12e numbers, company is available at a p/e of just 7.45 and a mcap-to-sales of just 0.62 and on FY13e numbers, company is available at a p/e of just 5.6 and a mcap-to-sales of just 0.48.

McNally Bharat Engineering Company Ltd

McNally Bharat Engineering Company Ltd


BUY AT CMP 210.00WITH IN A WEEK WE CAN EXPECT 225.00 JUST BUY

Bharat Bijlee Ltd (BUY -1000 Rs)

  Brightening outlook

Expected improvement in demand scenario for transformer and industrial motors augur well for the bounce back

India is expected to add a generation capacity of 62,000 MW in the 11th Five-Year Planas against the original 11th Plan target of 78,700 MW. Against the expected capacityaddition, of the country had added just 25,721.77 MW till November 2010, thus leavingabout 36,278.23 MW to be added in the balance period of about 16 months. Though thegeneration capacity addition target for the 12th Plan is not yet fixed, it may in upwardsof one lakh MW.

Given the thumb rule of 10 MVA of transformer demand for every MW of new generationcapacity, the demand in the next six years and three months is expected to be about 13-14lakh MVA. Even if about 80% of the current expectation of one lakh MW of generationcapacity addition happens in the 12th Plan, fresh demand for transformer will be about11-12 lakh MW in the next six years and three months. This translates into an annualtransformer demand of more than two lakh MVA.

If the expected replacement demand of about 20,000-25,000 MVA per annum and theprojected export demand of about 18,000 MVA per annum is taken into account, the currentunfavourable demand-supply scenario for transformers is expected to vanish given theaggregate transformer capacity of the country is expected to be around two lakh MVA perannum. This is all expected to result in improvement in realisation and profit for thecompanies operating in this industry in the short to medium term.

Bharat Bijlee (BBL) is one company well placed to gain from the demand scenario, whichwill turn from unfavourable to favourable. A leading manufacturer of power transformers inIndia, the company also manufactures a wide range of standard and customised low tensionelectric motors for industrial application, gearless machines for the elevator industryand other electrical products. Power transformers accounted for 72%, motors 23%, andothers the balance 5% of its revenue in the fiscal ended March 2010 (FY 2010).

A market leader in the 220-KV class of transformers, BBL caters largely to stateelectricity boards. Thus, the company enjoys the benefit of price variation clause for itsutility orders book. Due to the price variation clause, its sales value and margin go upwhen copper price moves up consistently, which has been the trend recently
Sales went up 11% to Rs 496.39 crore, and operating profit by 40% to Rs 61.22 in thenine months ended December 2010. Eventually, net profit was higher by 47% to Rs 35.12crore. Net profit grew a sharp 92% to Rs 14.18 crore even while sales rose an impressive28% to Rs 207.21 crore in the quarter ended December 2010.

The economy is expected to grow at around 8%, which would attract robust investmentsacross industries and, in particular, the power sector. This is likely to propel growth inthe markets in which BBL operates. Bearing this in mind, the company is continuing toinvest in the growth of the transformer and motor businesses, and in its projectsoperations.

BBL holds 28,25,160 shares of Siemens India. At the current price of around Rs 845, thecompany’s holding in Siemens India is worth around Rs 239 crore, which means aroundRs 423 per share of BBL. Notably, Siemens AG, Germany, which owns about 55% of the Indian company, plans to raise the stake to 75% and has offered to pay investors Rs 930 a sharein a voluntary open offer.

BBL has other investments in blue chip companies like Bank of India, HDFC, HDFC Bank,Hindustan Oil Exploration, and ICICI Bank. All these investments including those inSiemens are worth Rs 252 crore, which means around Rs 446 per share of BBL.( current market cap ..575 cr only)

Disinvestment of these holdings, as and when it happens, will unlock substantial value.Even if this investment is not sold, its value will only increase due to excellent growth prospects of these investments.


BBL’s book value was Rs 397 end March 2010. At the last AGM, the management hadindicated that it was willing to give bonus or consider stock-split at or before the nextAGM.

We expect BBL to register EPS of Rs 101.6. in FY 2011. The share price trades at Rs1020. P/E is 9.5. 


Source: Capitaline Databases 


INVESTMENT DETAILS

28,25,160 Equity shares of Rs. 2 each of Siemens India Ltd.

1,02,980 Equity shares of Rs. 10 each of HDFC Ltd.

15,821 Equity shares of Rs. 10 each of ICICI Bank Ltd

3,33,333 Equity shares of Rs. 10 each of Hindustan Oil Exploration Co. Ltd.

500 Equity shares of Rs. 10 each of the HDFC Bank Ltd. 

5,400 Equity shares of Rs. 10 each of Bank of India

In Mutual Funds

11,768,150 Birla Sun Life Savings Fund - Instl - Growth 2057.15

16,904,703 HDFC Floating Rate Income Fund - Short Term Plan - Wholesale -

Growth

2651.49

296,752 ICICI Prudential Flexible Income Plan Premium - Growth

 

HAND BOOK for LIFE

Health:

1. Drink plenty of water.
2. Eat breakfast like a king, lunch like a prince and dinner like a beggar
3. Eat more foods that grow on trees and plants and eat less food that is manufactured in plants.
4. Live with the 3 E's -- Energy, Enthusiasm, and Empathy.
5. Make time to practice meditation, yoga, and prayer.
6. Play more games.
7. Read more books than you did.
8. Sit in silence for at least 10 minutes each day.
9. Sleep for 7 hours. (or more)
10. Take a 10-30 minutes’ walk every day.. And while you walk, smile.

 Personality:

11. Don't compare your life to others'. You have no idea what their journey is all about.
12. Don't have negative thoughts or things you cannot control. Instead invest your energy in the positive present moment
13. Don't overdo. Keep your limits.
14. Don't take yourself so seriously. No one else does.
15. Don't waste your precious energy on gossip.
16. Dream more while you are awake.
17. Envy is a waste of time. You already have all you need.
18. Forget issues of the past. Don't remind your partner with his/her mistakes of the past. That will ruin your present happiness.
19. Life is too short to waste time hating anyone. Don't hate others.
20. Make peace with your past so it won't spoil the present.
21. No one is in charge of your happiness except you.
22. Realize that life is a school and you are here to learn. Problems are simply part of the curriculum that appear and fade away like algebra cl-ass but the lessons you learn will last a lifetime.
23. Smile and laugh more.
24. You don't have to win every argument. Agree to disagree
 Society:

25. Call your family often.
26. Each day give something good to others.
27. Forgive everyone for everything.
28. Spend time with people over the age of 70 & under the age of 6.
29. Try to make at least three people smile each day.
30. What other people think of you is none of your business.
31. Your job won't take care of you when you are sick. Your friends will Stay in touch,
Life:

32. Do the right thing!
33. Get rid of anything that isn't useful, beautiful or joyful.
34. God heals everything.
35. However good or bad a situation is, it will change.
36. No matter how you feel, get up, dress up and show up.
37. The best is yet to come.
38. When you awake alive in the morning, thank God for it.
39. Your Inner most is always happy. So, be happy.