Mid-cap stocks with safety and growth
A cursory glance at the list of top ten stocks to buy now is sufficient to show that the wizards at Karvy have carefully applied their minds and cherry-picked only those stocks which offer the perfect balance of growth and safety.
Let’s take a quick look at the top-ten stocks:
| Value Invest March 2017 – Top 10 Mid Cap Stocks | |||
| Stock |
CMP (Rs.) |
Target Price (Rs.) |
Upside (%) |
| BATA INDIA | 498 | 597 |
20 |
| GHCL | 254 | 304 |
20 |
| India Count | 163 | 193 |
18 |
| Indraprashta Gas | 1040 | 1213 |
17 |
| Jain Irrigation | 90 | 115 |
29 |
| Mayur Uniquoter | 363 | 482 |
33 |
| Menon Bearing | 71 | 81 |
19 |
| Minda Corp | 93 | 112 |
20 |
| Navin Fluorine | 2510 | 3003 |
20 |
| TRIDENT | 74 | 87 |
17 |
Let’s discuss a few of the stocks that we are familiar with:
GHCL
GHCL was regarded as such a junkyard stock at one point of time (March 2016) that Mudar Patherya admitted that he was taking the risk of recommending the stock knowing that readers would “reflexively flip the page”.
However, such is the visionary capability of Mudar Patherya that he proceeded to provide a masterful analysis as to why the manufacturer of soda ash and textiles deserved to be bought.
Mudar has been vindicated in his conviction because GHCL has surged from Rs. 108 to Rs. 269, posting hefty gains of 145% in just 12 months.
Sanjoy Bhattacharyya, the doyen amongst value investors, and Ashish Kacholia were also quick to recognize the potential of GHCL. They pocketed large quantities of the stock when it was going a-begging.
Several other illustrious investors such as IndiaNivesh Securities, EOS Multi Strategy Fund and Morgan Stanley have joined the list of shareholders.
Karvy’s logic for recommending a buy of GHCL is simple yet convincing. It has pointed out that GHCL has made capex additions which will drive growth across all segments and that there is a diversified business portfolio which will support overall growth. It is also emphasized that there are “high entry barriers” and that there is a “marquee customer base”. There is also a reference to the robust balance sheet and high return ratios of the company.
Indo Count Industries
Indo Count Industries is also familiar to us because Ashish Kacholia holds a dominant shareholding of 24,95,760 shares in it as of 31st December 2016.
Indo Count has been flat on a YoY basis which implies that it may be silently plotting a come back.
It is worth recalling that IDBI Capital has recently issued a research report on the home furnishing sector in which cogent reasons have been given as to why the huge demand expected from offshore will create prosperity for the sector.
IDBI Capital has also recommended a buy of Indo Count Industries with a target price of Rs. 218 per share (35% upside).
Karvy’s logic is on similar lines. It has also emphasized that the home textile segment will be the key growth driver and that massive demand from international markets will fuel the prosperity of the Company.
Jain Irrigation
Mudar Patherya had once described Jain Irrigation as an “awe generating company”.
Unfortunately, things did not go as per plan and the stock was condemned as a “fallen angel”.
Thereafter, Jain Irrigation received a new lease of life when Ambareesh Baliga recommended it as his “best pick for 2016”.
Fortunately, the stock has lived upto Ambareesh Baliga’s expectation by notching up hefty gains of 44% since his recommendation.
Jain Irrigation has also been recommended by Sandip Sabharwal and Ventura Securities as being a sound investment candidate.
Karvy has now given the green signal to Jain Irrigation. The logic is that the Government’s thrust on irrigation and housing will create growth enabling environment and that the Company is well poised to take advantage of it.
Navin Fluorine
Navin Fluorine is yet another stock that is familiar because two stalwarts, Ashish Kacholia and Rahul Saraogi of Atyant Capital, call the shots in it.
We saw how the duo bought the stock when it was languishing unwanted and nursed it to multibagger status.
I reported earlier that Navin Fluorine is now in the “big league” after collaboration with Honeywell, the American Behemoth.
Karvy has endorsed this by stating that the robust diversified portfolio and high margin business strategy of Navin Fluorine will drive growth. It is also pointed out that the innovation and strong domestic footprint of the company will be its major growth drivers.
Trident Ltd
Trident Ltd needs no introduction to us given that it is Dolly Khanna’s favourite stock.
We recently had the pleasure of inspecting the stock’s innards to determine what makes it tick and why Dolly took a fancy for it.
Not surprisingly, Trident Ltd has now become the hot favourite amongst expert stock pickers. I have collated the research reports of IDBI Capital, Ventura Securities, CRISIL, HDFC Securities, Dynamic Levels and Sanjiv Bhasin of IIFL on why Trident Ltd is a must buy now.
Karvy has endorsed these recommendations by pointing out that Trident Ltd is one of the largest integrated home textile players in the World and that the increased capacity utilization in the towel and bed linen segment coupled with the completion of capex, rise in cash flows and lowering of debt augers well for the Company.
Other stocks
The other five stocks recommended by Karvy are of equally top caliber. Karvy has also thoughtfully provided a technical analysis of each stock to demonstrate that the stocks are in a “secular upward trend” and are likely to effortlessly coast to higher levels!
Sir,
As per my friend advice i bought 75000 shares of samtex fashion @ 12 and my friend advice because of september share holding pattern of company in that mr porinju v veliyath . krishna kumar kapoor , sanjay devkinandan , ajay kumar goel , seema goel these person were invested nearl 13% of company share capital from last 15 days company price has come down to nearly rs 5 from rs 12
Please advice me what shell i do with my holding i am very small investor
Porinju Veliyath is a very nice man but if he jumps into a well will you jump into a well. if your friend is really your friend ask him to cover your losses. i am sorry i cannot comment on any stock because I will not be allowed to do so
to cover your losses invest in jain irrigation as rakesh-jhunjhunwala.in has just reported that karvy has recommended jain irrigation in march report for target of 119 rs this i think is intermediate target as ventura securities target is 276 without ipo valuation of jain farm fresh.jain farm fresh is a subsidiary 85% owned by jain irrigation and 15% owned by texas univ. thru investment arm Mandala rose finance mauratius, this was taken up at Rs 80 per share both by mandala and jain irrigation promoters. thus value of this comes to about 3000 crs which is almost the market cap of jain irrigation which is therefore foc. jain farm fresh is having a turn over much more than manpasand beverage and better margins. jain irrigation share holders will get this share in proportion to their holdings. SAFL is another subsidiary which is an nbfc but will become a rural bank again jain irrigation has 45% stake and texas unv and IFC are other investors.
I either invest in fundamentaly strong growth oriented known companies and I take exposure in micro and small cap unknown stocks through small and micro cap funds.I am invested in Mirae emerging blue chip fund,DSP micro cap,Rel smaller companies fund,Franklin smaller companies fund and HDFC mid cap fund to get exposure in micro ,small and mid cap companies.
As per my analysis following stocks may be good investment,
1. Divyashakti Granite : Good fundamentals with almost nil debt. Only 44 Lakhs of Shares is available with public. More than 50-60% of Revenue comes from exports to US where present President concentrating on increase in investment (around trillion dollars) to Infrastructure sector.
2. NILE: Strong fundamentals. Lead Prices are increasing ( present cost is around Rs.150/KG). The outstanding shares is only 14 Lakhs. The price may cross Rs.1,000/- after announcement of FY 2017 results. There is increase in Lead Acid Batteries in coming months.
3. TVS Srichakra: It is Mini MRF. Only 35 Lakhs shares with public.
4. Goldiam International : Good Stock for long term. No debts on books. As per fundamental & technical price target is around Rs.180/ to Rs.200/-
Thanks for sharing your advice, following are the mentioned pharma stocks to look after in 2017 for maximising returns.
1. Ipca Laboratories :- Pharma company Ipca Laboratories recently reported an plunge from its steady growth and a net profit of Rs 11.69 crore for the last quarter. Most predictions are maintaining a positive view of the stocks. Basically, the present performance of the stock has been impacted just because several of its factories went under the scanner of Federal Drug Administration. Most analysts hold an opinion that the stock can regain and bounce back to at least 25 per cent very soon.
2. Ipca Laboratories :- Pharma company Ipca Laboratories recently reported an plunge from its steady growth and a net profit of Rs 11.69 crore for the last quarter. Most predictions are maintaining a positive view of the stocks. Basically, the present performance of the stock has been impacted just because several of its factories went under the scanner of Federal Drug Administration. Most analysts hold an opinion that the stock can regain and bounce back to at least 25 per cent very soon.
3. Aurobindo Pharma :- Aurobindo Pharma is another great pharma stock that continued to find growth and in the recent years made some promising developments in coming with new life saving products, most notably the multi-disease treatment injection that bagged USFDA approval for the US market.
While both the revenue and profit margin of Aurobindo Pharma is continuing to grow, the brand is experiencing steady YoY return. It ensured a YTD return
of 38% in the current fiscal year.
4. Cadila Healthcare :- Cadila Healthcare is a steadily growing pharma company with a wide range of top pharmaceutical products both in OTC and life saving
drugs segments. This pharma company is one of the fastest growing and is dependent widely for long term holdings. Last year it’s stocks performed incredibly well. The YTD return of the stock is envisaged as per the CAGR at 28.75%.
5. Torrent Pharma :- Torrent Pharma is another most promising pharma company with a wide spectrum of pharmaceutical products for both domestic and international market. Torrent pharma is particularly a preferred stock for many fund manager and trader because of its consistent performance. YTD return of the stock as per CAGR stands at 31%.