Stocks in “pole position” are usually safe
Common sense dictates that stocks which are said to be in “pole position” are usually safe and investment worthy. This is because these stocks have not participated in the Bull Run and have been laggards. Investors have few expectations from such stocks and the risk of a disappointment is low.
However, because these stocks enjoy powerhouse credentials, they are expected to take off like rockets as and when the trend changes. Their “pole position” status means that visionary investors who back them early are expected to pocket huge gains without any risk to their capital.
Siyaram Silk Mills is in the pole position
To our good fortune, two of the finest minds in the investing fraternity, Ramesh Damani and Manish Bhandari, have confidently declared that Siyaram Silk Mills is in a pole position at present and will surge as soon as the trend changes.
It requires to be noted that Manish Bhandari (of Vallum Capital) has a stellar record when it comes to picking multibagger stocks. One of his favourite stocks, Indo Count, has stunned with 10-bagger gains in less than 24 months. Another one of his favourites, Shilpa Medicare, is firing on all cylinders and notching up hefty gains.
Vote of confidence by Dolly Khanna & Sunil Singhania
In an earlier piece, I remarked that it is sheer buffoonery to ignore any stock where Dolly Khanna has given her precious vote of confidence.
The basis of my assertion is Dolly’s stellar track record. Her portfolio has more glittering multibaggers than what anyone else can boast of.
Sunil Singhania has similar credentials. In his capacity as fund manager of Reliance Mutual Fund (one of the Country’s largest mutual funds), he knows the ins and outs of how to find multibagger stocks.
While Dolly Khanna holds 51,270 shares of Siyaram Silk Mills, Kanchan Sunil Singhania holds 28,007 shares. This is as of 1st April 2016. The present holding is not known.
Vinit Sambre’s DSP Blackrock Micro Cap Fund hikes stake
Another indication that Siyaram Silk Mills is on the correct trajectory comes from the fact that DSP Blackrock Mutual Fund has increased its holding in the Company to 5.25%.
Vinit Sambre has been awarded the title of “Best Mutual Fund Manager” for having delivered an impressive CAGR of 25.5% over the past five years. He has beaten his peers by a wide margin and so his stock picks cannot be taken lightly.
Research report by Angel Broking
Amarjeet S Maurya of Angel Broking has conducted painstaking research into the affairs of Siyaram Silk Mills. He has recommended a buy in the following words:
“Outlook and Valuation: Going forward, we expect SSML to report net sales CAGR of ~10% to ~ Rs. 1,948cr and adj. net profit CAGR of ~11% to Rs. 107cr over FY2016-18E. The same would be on the back of market leadership in blended fabrics, strong branding, wide distribution channel, strong presence in tier II and tier III cities, and emphasis on latest designs at affordable pricing points. At the current market price, SSML trades at an inexpensive valuation (at a P/E of 10.4x its FY2018E earnings). We recommend a Buy rating on the stock with the target price of Rs. 1,605.”
The target price of Rs. 1,605 implies that more than 30% gains are in the offing.
Research report by Centrum
Mrinalini Chetty and Siddhartha Khemka of Centrum have echoed similar sentiments regarding Siyaram Silk Mills. The duo has recommended a buy in the following words:
“Siyaram Silk Mills Ltd (SSML), for Q2FY17 reported flat numbers in-line with our expectation. Owing to muted consumer demand, revenue and net profit grew by 7% YoY to Rs. 420 crore and 6% to Rs. 27 crore, respectively. EBITDA margin was flat at 12.7%. With an aim to cater to a broad spectrum of market from mass to premium, SSML has developed and acquired wide range of brands. The company has also engaged in continuous advertising and promotions which have helped in establishing a strong brand recall. The change in product mix with better focus on high margin readymade garment segment and pick-up in consumer demand are the key future growth triggers for the company.”
Research report by Edelweiss
Edelweiss are also strong supporters of Siyaram Silk Mills. They have given the stock pride of place in their famous “Midcap Marvels” portfolio.
In addition, Kshitij Kaji of Edelweiss has given convincing reasons on why the stock is worthy of a buy:
Conclusion
We have to compliment Ramesh Damani and Manish Bhandari for putting Siyaram Silk Mills in the spotlight. It does appear that the stock has the necessary wherewithal to sparkle and bring cheer to the portfolio of Dolly Khanna and other stalwarts who have invested in it!
Next only to Real Estate ,Textile industry in general and those section of this industry in particular which are catering to domestic market ,will be hit hard in Modi Demonetisation Mismanaged Recession for atleast next two quarters and may take another year to recover ,that too if and only if no new Political Stunt or Drama unfold.Underestimating severe affects of Mismanaged Demonetisation on domestic market related industry may prove costly .
Situation is Extremely Bad, as per unconfirmed reports ( as only the concerned managements are authorised to officaly confirm this )one of the reputed company ,more than 100 hundred years old ,well known for towels and bed sheets through out India has closed textiles fabric manufacturing opertions permanently and one more very old big , old reputed company synonyms with cotton manufacturing for many years has stopped operations temporarily in its two big denim manufacturering plants and laid off aprox 800 employees due to sudden worsening of situation .You can google to find it out.
Dear Kharbji,
its unfortunate that senior boarder like you is not assessing situation properly . We may see a mini recession for couple of quarters but we are going to see a never before bull run in Indian equities soon .
Cash is a curse and we all are responsible for creating a parallel economy . I know there is lot of pain everywhere , majority in agriculture and related activities . But I am seeing a lot of change in peopels mentality now a days . Restaurant and lot of shopkeepers are ready to take cards for 100+ rs of purchase and lot of responsible citizens are simply denying any cash payments . All this white money will generate lot of revenues for government and all of us will reap its reach dividends .
All of us created this cash curse and we are blaming modi who shown some guts to clean the mess we have created for decades . If we do majority transactions in white its going to benefit our country immensely .
And if we hit a mini recession or a crash during next couple of quarters its going to be a lifetime opportunity for sure . Please check how DIIs shown confidence on Indian economy during november correction with whooping buying .
Thanks & Regards,
Prashant
Dear Prashant, with due respects and no meaning of personal offence to you at all, I will state the following. This DM exercise is a total flop. Yes, it has impacted people who had stored wads of cash at home. However, cash forms only 6% of the economy. Corruption and Black money will NEVER EVER cease to exist. My chartered accountant is still demanding his fees in new notes. The doctor, the carpenter, the architect, the plumber, the electrician, the RTO, the traffic policeman, all government interfaces with the public be it land records, sewage connection, water connection, building plan approval, EVERYONE STILL TAKES CASH. Nobody takes payment by card or online. Please dont fool yourself or place yourself into some utopia. Come to reality. The recent terrorist strikes from Pak based terrorists have proved terror money is here to stay. Fake money with new notes is being printed by China. And please take out from your mind that the country will prosper later after a lull. we have had enough number of people who have given such false promises. There are many many other factors required for the country to prosper. Getting back stolen black money from abroad is one of the most important factors. Indian black money is nothing compared to the money stored in swiss and other banks. Plus Modi has to come to power again in 2019, for keeping this going. Are you taking for granted that Modi will come back? I am not sure. Many say he may not get the majority next time. And if that happens, and some coalition forms, where will Modi’s efforts go? It could be reversed. There are four state elections that will be fought in 2017, starting January or February, results of which will directly tell you where Modi is heading. There have been enough number of world famous economists who have commented on this demonetisation exercise. And not even one of them favour it. Do read international journals like “The Economist”. They are carrying quite big coverage. I can go on and on, but dont have the time. Urge you to read more and get wider perspective rather than just have a narrow view.
It is already beaten down in last few days…. more to be seen.
Will be foolish to buy Textiles or any labour intensive industry at this point.
Kallam spinning is an underpriced Textile stock. Split announced recently. It has garment also.
#Kharb you are amazing with your assessment of mismanaged demonitaisation. In TN villages, farmwork is severely affected due to cash crunch. In our country where economy is 80% cash based, pausity of cash is a nightmare.
All these super investors bought this stock above Rates.800 or 1000.But is recommended by value pick blogger @ just RS.162.
http://value-picks.blogspot.in/2010/04/siyaram-silk-mills-ltd-buy.html?m=1
Not sure about the other investors, but Dolly seems to have bought this stock long back at very low levels. She might actually have exited the stock completely by now. With the demonetization-induced recession threat looming, this stock seems to be a bad buy at current price levels.
#Nivezareview :
Siyaram silk mills is a company which is a producer of blended fabrics in India. It is one of the renowned company and vertically integrated business. The products include Yarn-dyed yarns such as space dyed yarns, heavy denier yarns, embroidery and selvedge yarns and ready to wear garments. The company is growing steadily in terms of top and bottom line from last few years and well poised for further growth in coming years. The stock is available at reasonable valuations of 10-11 times its PE multiple and hence looks attractive from long term perspective. So long term investors can look to buy this with a view of 2-3 years.
http://www.niveza.in/m360-multibagger-stocks-for-long-term-value-and-growth-investing?utm_source=mr&utm_medium=article&utm_campaign=marketing
Looks good on Fundamental turf, if market starts recovering Siyaram Silk may look promising enough