
Allied Digital continued its strong growth trajectory though the equity dilution by issue of QIP shares has robbed the results of some sheen. This may be a temporary phase and one should stay invested
Sanjoy Bhattacharyya‘s stock recommendations are of fundamentally strong companies with good growth prospects. Such stock picks are very valuable because they compound quietly whilst ensuring that the investor get a good night’s sleep. We check whether his recent stock recommendations in Tata Sponge Iron & Taj GVK Hotels measure up to his high standards
Sunil Hitech Engineers has grown at an exponential rate of 103% over FY2007-09. Given this track record, the robust order book and the available opportunitys it is not unreasonable to expect Sunil Hitech Engineers to double its net revenues and earnings over FY2009-12. Thanks to the perception of Sunil Hitech Engineers being only a labour contractor, Sunil Hitech Engineers‘ stock trades at a PE of about 8 – 9 times its FY 10 earnings. This is at a discount to its peers and its current valuation leaves significant scope for re-rating.
We are always on the lookout for good companies with a strong growth track record and potential and whose shares are available at attractive valuations. The best case scenario is to find mid-caps which are trading at low valuations or in single-digit price to earnings (PE) multiples on the basis of their trailing one-year earnings. Low valuations mean that the downside is protected while leaving huge scope for appreciation in the stock prices. The factors to look out in finding such good companies are the dividend track record, cash flow from operations, return ratios, management track record and the future prospects.
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