Bajaj Finance – Best way to play the consumer boom:
Daljeet issued an “Initiating Coverage” report on Bajaj Finance on 12th July 2012 when the stock was available for Rs. 939. He recommended a buy on the basis that the stock was at “compelling valuations”.
Thereafter, during the 30 months that have elapsed, Daljeet has diligently issued updates, advising us periodically to hold or buy the stock, depending on the valuations.
Today, Bajaj Finance is at Rs. 4050, resulting in gains of 333% for Daljeet’s delirious followers.
In his latest report, Daljeet has foreseen more gains from Bajaj Finance. He says:
“BFL continues to remain preferred pick for investors led by strong business growth, safer business model with lowest NPAs in industry and limited investment options in financial space. We believe BFL deserves premium valuation compared to other NBFCs and private sector banks due to reasons stated above and better return profile with ROE / ROA of 21% / 3% for FY17E. We have built in 25% AUM CAGR FY15-17E leading to 23-25% growth in Net interest income and Net profit. At CMP of Rs 4,323, the stock is trading at P/ABV of 3.7x and 3.2x for FY16E and FY17E respectively. We upgrade BFL to buy from hold with upwards revised target price of Rs 5,500, 4x FY17E ABV.”
Daljeet also gave a talk on ETNow where he suggested that Bajaj Finance is the best way to play the consumption boom. He also equated Bajaj Finance with the venerable HDFC Bank.
Mastek Limited – More “value unlocking” gains in store:
Mastek is one of Daljeet’s brilliant strategic picks because he was able to foresee that there would be corporate action which would lead to “value unlocking”.
From the initiation price of Rs. 190 in July 2014 to the CMP of Rs. 421 are solid gains of 121% in about 6 months.
In his latest report, Daljeet has reiterated a buy with a target price of Rs. 554.
Max India – On hold:
Max India is another of Daljeet’s brilliant strategic picks. He put a buy on 5th March 2014 when the stock was quoting at Rs. 190. Today, the stock is at s. 518, resulting in gains of 162% in just 10 months.
In his latest update, Daljeet is jittery about the valuations and has put Max India on hold.
Lumax Auto Technologies – Very high returns expected:
Daljeet recommended a buy on 21st November 2014 when the stock was at Rs. 280. he promised a target price of Rs. 352 which has already got taken out.
In his latest report, Daljeet has hiked the target price to Rs. 575 on the logic that:
“We expect company to witness strong volume growth coupled with margin expansion in the next couple of years on the back of revival in automotive demand and value added products. With comfortable debt to equity of just 0.2x & strong ROE of ~22% we believe the company has potential to yield very high returns in next 2-3 years. The company has a consistent dividend track record with dividend payout of above 25%. At CMP of Rs 359, LATL is trading at 8.60x FY16e and 6.2x FY17e EPS. We find current valuation attractive and maintain BUY rating on LATL with target price of Rs. 575 (10x FY17E EPS)”.
Lumax Auto Tech is also Daljeet’s “Stock Pick for 2015” for Outlook Business magazine.
Among the other stocks that Daljeet has recommended a buy of are Dr. Reddy’s Labs (TP: Rs. 3819), Indoco Remedies (TP: Rs. 392). The results of several other favourite stocks such as Capital First, Ashiana Housing, JB Chemicals etc are awaited.