SHIL is a grossly undervalued small-cap blue-chip with potential for multibagger gains: Porinju

Discussion in 'Must-Read Interviews, Articles & News Items' started by Arjun, Jan 3, 2021.

  1. Arjun

    Arjun Chief Executive Officer (CEO) Staff Member

    Mar 19, 2015
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    Somany Home Innovation Ltd, alias 'SHIL', is the favourite Small-Cap stock of noted PMS fund managers Sunil Singhania and Porinju Veliyath.

    As of 30th September 2020, Abakkus Growth Fund PMS, which is Sunil Singhania's PMS, holds a treasure trove of 19,87,520 shares of SHIL.

    EQ India Fund, which is Porinju Veliyath‘s PMS Fund, holds 10,00,000 shares as of the same date.

    The stock has been surging like a rocket with a gain of 30% in just the last month.

    Porinju has opined that SHIL is grossly undervalued and deserves a market capitalisation of up to Rs. 10,000 Crore.

    "Small/midcaps are now in a new uptrend after being thrown away by institutions for last 2 years due to technical/regulatory reasons," he said.

    He cited the example of SHIL, the largest holding in his PMS to give the right perspective.

    "Somany Home innovation (SHIL), a 60-yr-old market leader in sanitaryware & home appliances business with 'hindware' brand and an extensive national distribution network was hammered down to RS.380 Cr market-cap recently. The valuation has since then improved to 1150 Cr now. Suppose SHIL was not a listed company and comes out with an IPO now, the same Funds would have subscribed at 5-6000 Cr valuation and on listing some jockeys would have taken it to 10,000 Cr - this shows both irrationality in the market as well as the potential of many such blue-chip small cap stocks," he added.

    Porinju also claimed that his PMS has raked in gains of 110.8% since the CoronaVirus crash.

    "Most of the stocks in your portfolio and their businesses are poised to do well. In
    fact, our PMS, on average is up by 110.8% in the first 9 months of current financial year,
    " he said.

    Sunil Singhania is also bullish on HIL

    HIL is the other real-estate-derivative stock held by Sunil Singhania's Abakkus Fund.

    The stock has been recommended as a 'Strong Buy' by SMIFS for 47% gain.

    It is stated that HIL is a renowned brand with multiple offerings and has market leadership in the roofing business.

    It is also opined that their product 'Charminar Fortune' will be a game changer and will take the Company to newer heights in years to come.

    Saurabh Mukherjea has recommended Astral Poly

    Saurabh has predicted that the revival in the real estate sector will benefit ancillary companies engaged in manufacturing pipes, tiles, paints etc.

    He has recommended Astral Poly as the only mid-cap company in the ancillary space.

    He has also recommended Asian Paints and Pidilite in the large-cap space.

    Godrej Properties, DLF recommended by Sanjiv Bhasin & Atul Suri have also surged

    Sanjiv Bhasin was amongst the first to foresee the boom in the real estate sector.

    As far back in August 2020, when realty stocks were in the dog-house, he had confidently predicted that "2021 will belong to real estate".

    “I have been an advocate of real estate and I can tell you if gold is going to be Rs 58,000 and you are going to be smiling your way to the bank, then definitely hard assets like real estate will be the next trend setter. Mind my words, 2021 will belong to real estate and that is hard assets,” he had said with immense confidence.

    Atul Suri had echoed similar views and recommended Godrej Properties.

    The top play in the realty sector is Godrej Properties. It is one of the best quality stocks in which leverage is not very high. This is one stock I could own and sleep well,” he had rightly advised.

    Godrej Properties is up nearly 40% since the recommendation by the stalwarts.
    Last edited: Jan 6, 2021