Tea & Plantations up next

We played the Sugar cycle rally in the market by participating in Upper Ganges 220 to 500, DCM Shriram Industries 166 to 256, Ugar Sugar 33 to 73, Rajshree Sugar 70 to 90 and KM Sugar 7 to 30....All of them gave excellent returns.

We played the Paper cycle rally in the market by participating in Star Paper 59.85 to 205, Kuantum Paper(BSE) 202 to 556, Nirvikara(Balkrishna) 44 to 120. they all provided insane returns.

Now up next the focus should be on Tea & Plantation.

May not be as big opportunity as Sugar & Paper but still a very good one for atleast 30-60% odd gains.

In paper, valuation wise cheap names look like:-

Harrisons Malayalam Limited (CMP 66) Tea & Rubber.

Dhunseri Tea & Industries Limited (DTIL) (CMP 290) Tea.

Mcleod Russel (CMP 149) Tea.

Rossell India Ltd (CMP 91) Tea & Defense.

Rubber & Tea prices are moving up and are expected to move up further and faster now onwards.

Note: The above is not a research report but information as available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that i might have Harrisons Malayalam Ltd, Dhunseri Tea & Industries Ltd, Mcleod Russel India Ltd and Rossell India Ltd in my portfolio and hence my point of view can be biased. Readers should consult their financial advisory before any investments.

NCL INDUSTRIES LTD - Cement, Pre-Fab Low Cost Housing

INTERESTING STOCK TO WATCH:

NCL INDUSTRIES LTD 
MCAP: 400 Odd Crores.
CMP: Around 118/-
CURRENT P/E: Around 8.
NEGATIVE: 82.94% Promoter Holding pledged.
POSITIVE: Sectoral bullishness

NCL Industries Ltd is a cement company from the state of Telangana.
NCL is also having a Prefab Houses segment.
NCL is also into Ready Mixed Concrete, Cement Bonded Particle Board & Hydropower.

Demonetization has been the buzzword since last month.
With Demonetization and the hard push on taxation the government is expected to get richer so there are obvious expectations that going forward from here there is going to be huge spending on Infra, Railways, Solar Energy, Housing For All from the Government.

NCL's core business is of Cement which is expected to do well with increased spending on Infra (roads,highways etc) and we have Prefab Housing segment, This segment is very important right now.

PreFab housing is used by many state govts. to realize the dream of Housing for All.
Apart from housing for all, the sector will witness huge demand as the country needs high number of cabins for toilets to improve sanitation and with the plans of cashless economy we need to increase the number of ATMs and very soon we are going to have Aadhar Micro ATMs. All this would require pre-fab cabins and structures.

There are select stocks available in this sector like, Sahyadri Industries, Richa Industries but I feel NCL is a safer bet because of a good brand of cement under its kitty. (Nagarjuna Cement).

Take a look at their pre fab site: http://www.nclind.com/why-ncl-prefab

Technically 110-109 looks like a strong support, if broken stock can correct otherwise there are chances of a good recovery and rally in this stock.

Note: The above is not a research report but information as available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that i might have NCL Industries LTD in my portfolio and hence my point of view can be biased. Readers should consult their financial advisory before any investments.

DYNEMIC PRODUCTS & DCM SHRIRAM INDUSTRIES

DYNEMIC PRODUCTS LTD.

DYNEMIC PRODUCTS posted on the blog at Rs 75 on 7th November 2014.

::LINK TO POST::

 The stock has rallied to 148 today, Making a fresh time high.

In two years the stock has moved up by almost 98%.

Now the stock is being pushed by many experts as a value pick at current levels.

Value Investing WINS again, Dynemic tested our patience a lot though.

Hope all the readers enjoyed!!!

 DCM SHRIRAM INDUSTRIES LTD.

DCM SHRIRAM INDUSTRIES posted on the blog at Rs 166 on 12th June 2016.

::LINK TO POST::

 The stock rallied to 256 last week, Making a fresh high.

In just six months the stock has moved up by almost 55%.

Hope all the readers enjoyed!!!

Let's do something this weekend.

We may be doing many things for the society but will never get an opportunity to be able to be a part of building a hospital... As they say. "Health is the greatest gift".

I urge the readers, If you have enjoyed reading the blog and want to return something, Please come forward and help
us raise funds for this much needed cause.

It doesn't matter if its big or small but we really need your support.

The organization (Shrimad Raj Chandra Love & Care) needs our support to build a Hospital in the rural belt of Gujarat.

Here is a indication of how your contribution can be put to use:-

Rs. 2,500/- An artificial limb for the physically challenged

Rs. 5,000/- A minor surgery

Rs. 10,000/- Safe motherhood for a less privileged woman

Rs. 15,000/- Intensive care treatment for a critically ill new born baby

Rs. 15,000/- Outreach medical care for a day.

Rs. 50,000/- A hospital bed for a month.

Here is the Ketto page guys do contribute and share with all your friends: https://tsk25.ketto.org/fundraiser/AmritaManshiAdityasPledge?utm_source=internal&utm_medium=fbpageshare&utm_campaign=AmritaManshiAdityasPledge

Shree Ajit Pulp & Paper - New Paper Stock to Watch

In a simple post on this blog on 25th July 2016 titled Paper Stocks up next I talked about 3 paper stocks.

Star Paper, Kuantum Paper, Nirvikara (Name changed to Balrkishna).

All of them have moved insanely. 

SO HERE IS ANOTHER INTERESTING STOCK TO WATCH:

SHREE AJIT PULP & PAPER LTD

BSE: XD GROUP

BSE CODE: 538795

CMP: AROUND 250

MARKET CAP: 140 CRORES

TRAILING P/E: AROUND 10

P/E AS PER FULL YEAR EXP: UNDER 8 

ON THE CHART IT LOOKS LIKE IT HAS BEEN A HIGHER HIGH, HIGHER LOW BULL RUN AND CAN DO REALLY WELL GOING FORWARD.

AND I WILL NOT SAY A WORD ON DONALD TRUMP AND THE WAR AGAINST BLACK MONEY, WHILE DONALD TRUMP IS NOT HIGHLY RELEVANT TO OUR MARKETS AND THE BLACK MONEY WAR IS A GREAT STEP, I FEEL ITS ALREADY SO BADLY HYPED BY THE MEDIA THAT WE DON'T NEED TO TALK MORE ABOUT IT AND JUST FORGET IT FOR A WHILE.

Note: The above is not a research report but information as available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that i might have SHREE AJIT PULP & PAPER LTD in my portfolio and hence my point of view can be biased. Readers should consult their financial advisory before any investments.

JK AGRI GENETICS LTD almost 100% returns in 6 months

I wrote about JK AGRI GENETICS LTD on 14th May 2016 when the stock was at 389.

On 2nd November 2016 the stock touched a high of 769. That's a rally of 380 rs per share

The stock rallied about 98% from 389 and as we had written about the possible re-rating.

Mr Market did the re-rating :)

Here is the link to JK AGRI post

Hope readers are enjoying reading the blog. Hope to come up with something new soon! :)

Happy Diwali

Paper Stocks Rally

In a simple post on this blog on 25th July 2016 titled Paper Stocks up next I talked about 3 paper stocks.

Star Paper, Kuantum Paper, Nirvikara (Name changed to Balrkishna)

Even though I expected upto 40% gain in these paper stocks, lets take a look how they have fared.

Star Papers closed at 59.85 on 25 July 2016 and made high of 138 on 13 October 2016.

Kuantum Paper closed at 202 on 25 July 2016 and made high of 433 on 13 October 2016.

Nirvikara (Balkrishna) closed at 44.15 on 25 July 2016 and made high of 119.75 on 13 October 2016.

Star Paper rallied 130%

Kuantum Paper rallied 115%

Nirvikara/Balkrishna rallied 170%

All this under 3 months... Wasn't the rally fast and furious guys?

KM Sugars up 222% in less than 5 months.

I wrote about KM Sugar Mills being an interesting penny stock in the buzzing sugar sector on 31st May 2016 when the stock was trading at Rs 7. Today right now the stock is trading at Rs 22.55.

Stock is up 222% in since 31st May 2016.

Here is the link to KM SUGAR post

Hope readers are enjoying reading the blog.

KM Sugars proved to be a golden penny but always remember Penny Stocks might be injurious to wealth.

Indian Overseas Bank

Nifty is almost near 9000 now, Another psychological landmark.
I had warned readers of a crash in my last post a month back, Nifty was at 8700 at that point of time.

Markets have refused to go down, Not just Indian even Global Markets have withstood every threat.
Be it: Brexit, FED, More looming EU exits, Lack of earnings growth, Expensive Valuations or even Donald Trump.

While writing the last time a month back, I was very clear that a Crash is coming up. As I write now I am very unclear about what is going to happen up next.

Anyway, That said we don't really have to predict the indices to make some money.
If we see the stock specific movement in last few days we can clearly gauge something.
Unitech was up 20% Yesterday. GMR INFRA is buzzing today.

Banking stocks have rallied a lot. What that means is regardless of fundamentals the Market is going GaGa behind beaten down stocks maybe because there is not much value left for value picks at present in the market.

In the banking sector, I was keen to buy J&K Bank yesterday but today it opened up 15%. So we have to mix a bit of charts here right now to pick a beaten down stock.

At current market price of around Rs 28, I think INDIAN OVERSEAS BANK is one such banking stock which can give a quick buck.
By quick buck I mean super-fast rally of more than 20-30% in the next 1-2 months however it can happen in next few days itself.

Below is a weekly chart of IOB showing how it can breakout above 30-33 with either price action or time delay.

Sometimes the Investor has to think and act like a trader ;).

Note: The above is not a research report but information as available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that i might have Indian Overseas Bank in my portfolio and hence my point of view can be biased. Readers should consult their financial advisory before any investments.

Time to be cautious

NIFTY: Near 8700
SENSEX: Near 28000

As earlier post was really short here I am writing this for better understanding of what I mean.

Nifty at current levels is near 24 p/e, US Index S&P 500 at current levels is near 24 p/e too. For any index, 24 p/e cannot be value territory for investors. Couple that with the lack of sufficient earnings growth in the market, It becomes ripe for a crash. We have so far avoided the crash because World Economies are printing money and sustaining their Economies, That is what US QE is (layman wise) and now they are going towards Hiking instead of Easing. We have a very strong Government at Center, We can see things improving after decades of misrule but the problem is at the Global Front.. Even US elections are around the corner and if Donald Trump sails through which I feel is possible, He is not much liked by the markets. Having said that, I would avoid making a DOOMSDAY commentary here which actually is a probability but no one can time it, I would suggest Investors to stay focused and Investment or Portfolio wise go behind stocks which are seriously in the value territory rather than buying bloated names at astronomical valuations because when Market cracked last time, Mega Bull Stocks like Educomp got finished while under valued stocks went under correction to emerge as a Multibagger in the Future. So Investors should be very cautious in the market right now.

What is at 24 P/E might go up further and trade at 28 P/E but I hope readers understand the Risk and Reward here. Disclosure: I Look to increase small position out of profits in Nifty 7000 December Put which is trading at Rs 25 right now. Hypothetically If Global Markets crack 30% and we follow suit, Nifty could get close to 6000 and in that case Nifty December 7000 Put should trade close to 1000, That is if anything of that sorts happen by December 2016 Expiry, Otherwise it is going towards ZERO so All in All its a Total Gamble with 100% risk and with low "probability" of returns buts thats just a Small Trade with Reward in favorable situation being really good.

Time to be cautious

Nifty is trading at almost 24 p/e, S&P 500 (US) is trading at near 24 p/e too.

We have events like USA Presidential Elections coming up, Donald Trump not liked much by market.

We are not under valued at current valuations and markets do come back to undervalued territory.

While experts are going berserk with SENSEX 1,00,000 by 2020 views on the street I think investors should adopt a cautious approach right now and buy only really undervalued stuff rather than investing in risky companies, I am not saying time to Panic Sell but just be cautious because it is better to be safe than sorry.

Paper Sector up next

In market cycles it is often seen that the four dogs of market: Sugar, Fertilizer, Drilling/Offshore/Shipping, Paper move one after another or altogether and the Paper would be the last in the cycle which would mean short/mid term bullishness of market is over (what is technically called a TOP).

Sugar up tick has been done, Fertilizer somewhat moved, Drilling/Offshore started today, Paper seems to have started now.

In paper, valuation wise cheap names look like: Star Paper, Kuantum Paper(BSE), Nirvikara (not profitable but dirt cheap mcap, Damani ji invested).

The run in paper will not be as much as Sugar at all and should be capped at about 20-40% returns from CMP at max.

Mirza International Ltd - Making in India for the World

Hope readers enjoyed the Weekend GST Puzzle.

Received 29 correct answers.

Right answers given by: Sumit Sahota, Amit Saini, Dipak, Ravish, Jigar KK, Arvind, Manoj Gadhia, Krishna Sharma, Jaidev, Atul Singhania, John, Nidhi Jain, Ankush Sharma, Sachin Jain, S Mathews, Laxman Raghavan, Rahul Sharma, Vijay, Nifty King, Harshad, Viren Patel, Siraj Ahmed, Isryil Ahmed, Umang, Jatin Rathore, Sandeep Sinh, Vijay Bhatia, Utsav , Jigar Punamiya.

The Ace Investor

Mirza International Ltd

  Listed on both NSE: MIRZAINT & BSE: 526642
Currently trading around 91 with a market cap of around 1100 crores.

Promoters hold 73.78% stake.
It has a Total Debt of around 190 crores.

Mirza International Limited is one of India's leading manufacturer and marketer of leather footwear and finished leather.

Incorporated in 1979 as Mirza Tanners Pvt Ltd by 2010 Padma Shri awardee Irshad Mirza & Rashid Mirza. Today the company has grown to almost 1000 crores with established footprint across 30 countries

The company supplies to many international brands and also owns international brands such as "Redtape" and "Oaktrak".

Almost 70% of the business of the company comes from overseas sales and out of that almost 60% of the total overseas sales are from United Kingdom out of which 15% are from own brands.

Apart from United Kingdom and rest of the world, Mirza International is very bullish on USA and has been expanding and growing in the region.

The revenue from USA in FY15 was 84 crores growing at CAGR of 119%. The FY16 detailed presentation is yet to be shared for further information.

The company initially had big plans to sell its brand in India but when exports posed as an attractive opportunity the company did change tracks and started focusing on exports which has helped them rise to this size today. Back in the 2000s Mirza International hired Salman Khan to endorse the brand Red Tape.

The company also says that RedTape is the only Indian brand to sell globally and earn significant revenues. It appears to be true because other companies have only managed to supply to global players and have never really took the risk of brandishing their own label.

Coming to the quality of shoes, I had purchased Red Tape shoes and they look and feel premium compared to the price we pay and it does enjoy good reception overseas and in India. Oaktrak brands reception in overseas market is good too.

The company actively sells its products in India and overseas via retail as well as e-commerce.

https://www.amazon.co.uk/Oaktrak-Winterhill-Leather-Chelsea-Oxblood/dp/B008HF7K4E

The above Amazon UK link shows one particular Oaktrak boot, if you take a look at it you can make out that the products of Oaktrap & Redtape are well priced, great in quality and also liked by people. Do read the customer reviews over there.

The key negative here would be the dependence on UK in particular.

With Brexit becoming a reality and pound coming down crashing, Companies which export to UK don't stand to benefit, But if we use common sense, after Brexit the Brits are not going to stop wearing shoes, infact trade between India-UK can be increased further.

Meanwhile, the pound crash may impact the company's profit margins to some extent if not properly hedged for currency risks at the same time there has been a new development that is the amalgamation of a debt free promoter owned company named Genesisfootwear Enterprises Ltd, with the amalgamation having taken place the company has shown remarkable improvement in bottomline because Genesis is a debt free cash generating company.

http://www.mirza.co.in/schemeofamalgamation.html

Coming to the financials let us take at last 10 years Annual Results of the company :-

Consistent topline growth and consistent. Extreme stress can be seen on the bottomline of the company during the period of Global Recession of 2008-2010 after which the sentiment revived. However, even during that period the company has not dipped into losses.

At current price of 91 the stock is trading at p/e of 12.62 while Bata trades at 45 p/e, Liberty trades at 30 p/e, Relaxo trades at 50 p/e, Lawreshwar trades at 20 p/e.

Looking at the branding, the products, I feel re-rating is possible in this case.

Stock has corrected this year and doesn't look on the expensive side but it is trading near the 52 week low right now.

March quarter results for Mirza was really good with significant increase in bottomline and profit margins after the amalgamation. Should keep eyes on June quarterly results too if similar trend is seen the EPS will be increase further this FY and the Brexit pound crash negative impact would mostly be visible in September quarter.

Recently news is that the Govt. is ready with an incentive package for the leather sector http://economictimes.indiatimes.com/news/india-unlimited/csr/policy/make-in-india-incentive-package-for-leather-sector-on-the-anvil/articleshow/53176474.cms

Next week from Monday, the Monsoon session of Parl will begin and Market expects that GST will sail through this time. GST is positive for the sector at whole.

All in All I feel there is value in Mirza International at CMP.

Note: The above is not a research report but information as available on public domain and it should not be treated as a research report.

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”

Disclosure: It is safe to assume that i might have Mirza International Ltd in my portfolio and hence my point of view can be biased. Readers should consult their financial advisory before any investments.

:Links:

Mirza Website

2015 Annual Report

Old Salman Khan ad for Red Tap

Screener for Mirza

Can You Guess This Stock? Weekend Exercise

Guess This Stock ::

1) Consecutive annual topline growth since last 10 years.

2) Current price of the stock is under 190.

3) GST beneficial for the sector.

4) Bollywood super-star has had association with the company for endorsement.

5) Company has consistently paid dividend for more than last 10 years.

6) P/E of majority of the companies in this sector is atleast double than subject company.

7) Stock has corrected more than 10% in Calendar Year 2016.

8) Current Market Cap under 2000 crores.

9) This particular company might be avoided by readers from minority community in India.

10) Aur CLUES nahi milenge!

11) Told ya, No more clues!

Email your answers on theaceinvestor@gmail.com. Right answer with a write-up along with your name will be posted on the blog.

15th July 2016 - 2:00 PM.

Snowman Logistics Ltd up 50% in two months.

I wrote about Snowman Logistics Ltd and prospects of the cold chain industry on 9th April 2016.
Snowman was trading at Rs 60 back then, Today Snowman rallied to Rs 90.

Snowman is up by 50% in just two months.

I am keeping a close eye on Snowman as GST is back in focus again with Monsoon Parl. Session starting soon. 

Here is the link to Snowman 9th April post

Hope readers are enjoying reading the blog.