*Caution: Please note that your copy/access to our website is for your exclusive use only.

Any attempt to share your access to our website or forwarding your copy to a
non-subscriber will disqualify your membership and we will be compelled to stop your supply and forfeit your subscription thereafter without any refund to you.

T I M E S
A TIME COMMUNICATIONS PUBLICATION
VOL XXVIII No.14 Monday, 04 – 10 February 2019 Pgs.19 Rs.20

Modinomics ahoy! Now follow us on Instagram, Facebook &

By Sanjay R. Bhatia Twitter at moneytimes_1991 on a daily basis
The markets moved lower during the first three days of the week to get a view of the stock market and the
due to sustained bouts of selling pressure as the Nifty tested the happenings which many may not be aware of.
support level of 10589. The Nifty managed to bounce back on
Thursday, which coincidently was also the January F&O series expiry day. Sustained bouts of short-covering and buying
support in index heavyweights drove the markets higher. The breadth of the market favoured advances amidst high
volumes, which is a positive sign for the markets.
The FIIs turned net buyers in the cash and derivatives segment. The DIIs, however, turned net sellers and were seen
booking profits at the higher levels. On the global front, crude oil prices moved higher as USA banned Venezuelan state-
owned oil firm PDVSA. However, large stock piles and economic slowdown in China continue to weigh on crude oil
prices.
The US markets moved higher as the Federal Reserve
maintained a status quo in its policy and signaled about being
Believe it or not!
patient on future hikes. On the domestic front, the earnings  Tanla Solutions recommended at Rs.31.70 in
season continued to paint a mixed picture. The new Finance TT last week, jumped 27% to Rs.40.40 in just 1
Minister, Mr. Piyush Goyal, announced a pro-people budget week!
with an eye on the forthcoming elections, which was in line with  Welspun India recommended at Rs.57.45 in EE
expectations.
last week, jumped 6% to Rs.60.8 in just 1 week!
Technically, the prevailing positive technical conditions helped  Aro Granite Industries recommended at
the markets post gains. The Stochastic, KST and RSI are all
Rs.52.35 in TF last week, jumped 5% to Rs.54.95
placed above their respective averages on the daily and weekly
charts. The MACD is placed above its average on the weekly in just 1 week!
chart. Moreover, the Nifty is placed above its 50-day SMA, 100-  Sree Rayalaseema Hi-Strength Hypo
day SMA and 200-day SMA, which augurs well for the markets. recommended at Rs.152.55 in TF last week, rose
These positive technical conditions could lead to follow-up 4% to Rs.158.95 in just 1 week!
buying support.  Jammu & Kashmir Bank recommended at
The prevailing negative technical conditions, however, still hold Rs.38.45 in TF on 21 January 2019, jumped 9%
good. The MACD is placed below its average on the daily chart. to Rs.42 in 2 weeks!
The Nifty’s 50-day SMA is still placed below its 200-day SMA,
signaling a ‘Death Cross’ breakdown. All these negative (EE – Expert Eye; TF – Techno Funda;
technical conditions could lead to intermediate bouts of selling TT – Tower Talk)
pressure and profit-booking, especially at the higher levels.
The +DI line has moved above the -DI line and above 30, which This happens only in Money Times!
indicates that the buyers are gaining strength. But the ADX line Now in its 28th Year
is still languishing around 11, which indicates that the markets

A Time Communications Publication 1

lack trend and the current up-move has no strength. The Nifty managed to close above 10843, which augurs well for the
markets. It is important for the Nifty to sustain above this level for follow-up buying support to emerge and to move
higher to test the 10942 level, followed by the psychologically important 11000 level. If the Nifty fails to sustain above
10843, then it may move lower to test the support range of 10756-10710.
The markets are likely to remain volatile till the nuances
and fine print of the Union Budget are digested. The
markets are still stuck in the broad range of 10500-
10985. Regular bouts of follow-up buying support are
needed for the Nifty to break out of this broad range.
Stock-specific action is likely to continue due to the
ongoing earnings season. Meanwhile, the markets will
take cues from the earnings season, reactions to the
Union Budget announcements, Dollar-Rupee exchange
rate, global markets and crude oil prices.
Technically, the Sensex faces resistance at the 36602,
37165, 37490 and 38125 levels and seeks support at the
36350, 35606, 35400, 35187, 34748, 34344, 33723 and
33349 levels. The resistance levels for the Nifty are
placed at 10942, 11008, 11146 and 11350 while its
support levels are placed at 10843, 10756, 10710,
10625, 10589 and 10534.

BAZAR.COM

Ek kadam… hazaar raahein

The Vote on Account popularly referred as the Budget turned into an ‘Account for Votes.’ Since all is fair in love and war
and electoral politics, it was evident in the Budget speech and the proposals made on Friday, 1 February 2019. Acting FM
Piyush Goyal seems to have taken the ‘ek kadam’ for his government, which could lead to ‘hazaar raahein’. Although the
tax rebates and rise in standard deduction proposed in the Budget brings cheers to the middle-income tax payers, these
perks and benefits will ultimately dent government revenue, which will need to be filled by the rich or other ways of
taxation. Little wonder, political leaders from the Opposition benches termed it as a damp squib.
Ex Finance Minister, P. Chidambaram said, “Thank you interim FM for copying the Congress’ declaration that the poor
have the first right to the resources of the country.” Before we ponder over the arithmetic of the Budget and its impact,
one can safely conclude that this Budget is more of a political document to the core than an economic programmer. All
the populist measures announced become the responsibility of the new government to deliver. So whether the NDA or
UPA wins, neither of them can roll back the largesses but how they balance the revenue with the rising outlay will
remain a chronic pain.
Market behaviour on Budget day was truly perplexing. The Sensex opened 55 points higher at 36311 from the previous
day’s close of 36256. Braving the major part of the FM’s speech, the market was tightly gripped around 36,360 till mid-
noon. Positive announcements on tax rebates, etc. thereafter drove the markets to a high of 36778 in a matter of minutes
only to sink as low as 36221 (lower than the previous day’s close) as the euphoria started fading. In the last half hour,
however, at least 50% of the intra-day losses were covered and the Sensex closed 212 points higher at 36469.
Sectoral performance at the end of the budget trading session is as follows: BSE Sensex (+0.59%); BSE 100 (+0.6%); BSE
200 (+0.57%); BSE 500 (+0.54%); BSE I.T. (+1.11%); BSE FMCG (+1.14%); BSE Capital Goods (+0.8%); BSE Consumer
Durables (+0.74%); BSE Healthcare (+0.84%); BSE PSU (-0.84%); BSE Tech (+0.86%); BSE Bankex (nil); BSE Auto
(+2.65%); BSE Metal (-3.8%); BSE Oil & Gas (+0.16%); BSE Mid-Cap (+0.56%); BSE Small-Cap (+0.17%); BSE Realty
(+1.33%); BSE Power (+0.37%); BSE Infra (+0.32%).
The IT, FMCG, Realty and Auto sectors gained higher than average. Thus, the market’s maturity was evident in
recognizing better corporate performances at the micro level, which ultimately drives share prices in the long run. This
Budget will surely iron out the grudges and negativity of the SMEs (Small & Medium Enterprises), traders, working class
and farmers against the NDA. Women, too, are being wooed by specific announcements. On the whole, the Budget
remains ‘ek kadam… hazaar raahein.’

A Time Communications Publication 2

 WIN THE DECADE, NOT JUST THE DAY!
By Nehar Sakaria
A 10-year challenge is driving the internet crazy. For those who are unaware, social media users are going crazy having a
blast from the past as they share 10-year old photos of themselves alongside their current photos, which is now labeled
as the ‘ten year challenge’. Taking a cue from this internet fad, it may not be out of place to review the 10-year
performance of the stock markets.
To begin with, let’s have a look at the journey of the global markets. While USA’s Dow Jones has risen over 2.5 times from
the 8775 level in December 2008 to ~23300 in December 2018, Germany’s DAX has risen about 2.2 times from ~4800
to ~10560, Hong Kong’s Hang Seng has risen nearly 2 times from ~14400 to ~25850, UK’s FTSE has risen 1.5 times
from ~4430 to ~6730 and China’s Shanghai Composite has risen around 1.4 times from ~1820 to ~2500. Outpacing
some of the bigwigs in the developed world, India’s Sensex has risen over 3.5 times from the 9650 level in December
2008 to cross 36050 in December 2018! This means that India is the best performing equity market of the last decade.
The Sensex comprises 30 financially sound companies listed on the BSE, more than half of which have outperformed the
index in the last decade. The performance of some blue-chips stands out. IndusInd Bank has delivered over 3200%
returns over the last ten years, Maruti Suzuki (India) over 1450%, Yes Bank about 1400%, Asian Paints about 1200%,
Bajaj Auto about 940% and Tata Consultancy Services about 900%! The stock markets have steadily risen for nearly ten
years now after the Lehman Brothers crisis in 2008, which led to one of the largest erosions of investor wealth. The
markets have almost quadrupled since bottoming out ten years ago. Investors who’ve held throughout a couple of
hiccups since then have been rewarded handsomely. After all, the good thing about being at the bottom is that the only
way to go is up!
The markets have been quite volatile for the past few months as negative global and domestic cues continue to weigh on
the investor sentiment. Repeated bouts of volatility in 2018 have forced investors to reassess their tolerance for risk.
Always remember that market corrections are more common than we realize and are generally short-lived. Only two
times since 1992 has a correction lasted longer than 10 months i.e. during the dot-com bubble and the Lehman Brothers
crisis. All other corrections in between were erased out by a bull market rally within weeks or months. This means
investors who buy quality stocks taking advantage of the temporary hiccups and hang onto them over the long run will
mostly succeed.
Downturns are no reason to panic. Stocks can fall fast and bounce back hard. Instead of panicking, investors must use
such opportunities to reassess their investment holdings and accumulate quality stocks. Focus on winning the decade,
not just the day!

TRADING ON TECHNICALS

Resistance prevails at the higher range

Sensex Daily Trend DRV Weekly Trend WRV Monthly Trend MRV
Last Close 36469 Up 35878 Up 35831 Up 33367
Start Date - 31-01-19 - 11-01-19 - 31-05-16 -
Start Level - 36256 - 36009 - 26667 -
Gain/Loss (-) - 213 - 460 - 9802 -
% Gain/Loss (-) - 0.59 - 1.28 - 36.76 -
Last week, the Sensex opened at 36099.21, registered a low at 35375.51 and moved to a high of 36701.03 before it
closed the week at 36469.43 and thereby showed a net rise of 443 points on a week-to-week basis.
We saw an ‘Out Bar’ on the weekly chart and therefore, a sustained move out of last week’s high and low on the weekly
closing movement indicating directional movement.
Daily Chart
The Sensex crossed the resistance levels of 36446, 36554 and 36701 before it closed at 36469 on Friday. The resistance
levels are now placed at 36701-36778. The next major directional movement will be outside the band of the last two
months i.e. 37000-35000.
Weekly Chart
We maintain our view given in the past issue despite the volatility. Alternate week fluctuations and close sequences have
continued since mid-November 2018 but the Sensex did not revert to weekly gains with higher lows and higher highs
signifying bullish condition. As a result, the volatility remained within the band.

A Time Communications Publication 3

Till the Sensex does not cross 37000, the rise from 33291 should be considered as a pullback (Wave b structure). The
right shoulder of the ‘head and shoulder’ pattern has developed, which is bearish in nature.
The neck line and its bottom may be tested. The neck line is placed around 33700 with neckline points at 32483 and
33291.
Unless and until the Sensex does not cross 37000 with a
bullish candle, the markets will tend to test the neck line,
which is currently placed around 34000. The slide could be
towards 34000-33291-32483.
Confirmation of the major head and shoulder pattern is
only after the neck line is strongly violated with volumes.
This may take some time to materialize. The markets are
likely to test the neck line or the traditional trend line.
The current movement is choppy and the Sensex seems
squeezed under 37000. The right shoulder is likely to
extend if the Sensex sustains above 37000, in which case
the rise may be towards 37700-38000.
If the Sensex does not cross 37000 in the next 1-2 weeks, a
catastrophic fall is likely. Alternatively, the prolonged
sideways corrective and squeezed movement may continue.
The support levels are placed at 36207-35637-35375.
Higher range for the week is 37039-38442. On a sustained breakout above 37000, expect a rally to 37774.
BSE Mid-Cap Index
Weekly Chart
The support level was placed at 14297 and the low registered last week was 14316. Expect further weakness below
14200. A pullback or reversal may resume on a sustained rise above 14831.
BSE Small-Cap Index
Weekly Chart
The support levels are placed at 13715-13624-13396. Major weakness is likely below 13300. A pullback is possible if the
index sustains above 13889.
Strategy for the week
Traders who are long can maintain their stop loss at 35300. Unless and until the Sensex crosses 37000 on a weekly
closing basis, the overall objective for traders should be to book profits. The same view was given in the last edition and
the Sensex reacted from 36778 to close at 36469. Resistance remains at the higher levels. Traders who are short need to
maintain their stop loss at 37000. Cover short positions at 36207 or below. Sell below 35300. Till then, traders can cover
their short positions or sell at 36700 with a stop loss of 37000. Re-enter long if the Sensex closes above 37000.

WEEKLY UP TREND STOCKS

Let the price move below Center Point or Level 2 and when it move back above Center Point or Level 2 then buy with whatever low
registered below Center Point or Level 2 as the stop loss. After buying if the price moves to Level 3 or above then look to book profits as
the opportunity arises. If the close is below Weekly Reversal Value then the trend will change from Up Trend to Down Trend. Check on
Friday after 3.pm to confirm weekly reversal of the Up Trend.
Note: R1-(Resistance), R2- (Resistance), R3- Resistance, S1- Support & S2- Support

Weekly Up
Scrip Last Relative
S1 S2 - R1- R2- Reversal Trend
Close Strength
Value Date
Weak Demand Demand Supply Supply
below point point point point
NIIT TECHONOLOGIES 1317.10 1275.0 1282.2 1310.0 1344.9 1407.7 66.1 1249.9 11-1-2019
INFO EDGE (INDIA) 1735.15 1642.8 1657.2 1720.8 1798.8 1940.4 61.9 1650.2 11-1-2019
NESTLE INDIA 11568.00 11115.0 11244.3 11438.7 11762.3 12280.3 60.0 11354.5 11-1-2019
WIPRO 371.35 353.3 358.9 365.7 378.2 397.6 59.8 349.7 11-1-2019
UNITED BREWERIES 1450.00 1376.0 1394.3 1431.7 1487.3 1580.3 59.7 1415.8 21-12-18

*Note: Up and Down Trend are based of set of moving averages as reference point to define a trend. Close below
averages is defined as down trend. Close above averages is defined as up trend. Volatility (Up/Down) within Down

A Time Communications Publication 4

Trend can happen/ Volatility (Up/Down) within Up Trend can happen. Relative Strength (RS) is statistical
indicator. Weekly Reversal is the value of the average.

WEEKLY DOWN TREND STOCKS

Let the price move above Center Point or Level 3 and when it move back below Center Point or Level 3 then sell with whatever high
registered above Center Point or Level 3 as the stop loss. After selling if the prices moves to Level 2 or below then look to cover short
positions as the opportunity arises. If the close is above Weekly Reversal Value then the trend will change from Down Trend to Up Trend.
Check on Friday after 3.pm to confirm weekly reversal of the Down Trend.
Note: R1-(Resistance), R2- (Resistance), R3- Resistance, S1- Support & S2- Support

Weekly Down
Scrip Last Relative
S1 S2 - R1- R2- Reversal Trend
Close Strength
Value Date
Demand Demand Supply Supply Strong
point point point point above
VEDANTA LIMITED 162.30 108.1 147.8 172.9 187.4 198.0 23.89 187.99 1-2-2019
STERLITE TECHNOLOGIE 222.55 113.7 191.4 237.9 269.1 284.4 25.03 272.35 25-01-19
SAIL (STEEL AUTHORIT 46.25 42.6 45.2 46.7 47.8 48.2 25.52 48.86 11-1-2019
RELIANCE CAPITAL 189.15 153.9 179.6 195.6 205.2 211.7 29.10 206.05 4-1-2019
IDEA CELLULER 30.85 25.7 29.2 31.0 32.7 32.8 31.99 33.92 4-1-2019

*Note: Up and Down Trend are based of set of moving averages as reference point to define a trend. Close below
averages is defined as down trend. Close above averages is defined as up trend. Volatility (Up/Down) within Down
Trend can happen/ Volatility (Up/Down) within Up Trend can happen.
EXIT LIST
Note: R1- (Resistance), R2- (Resistance), R3- Resistance, S1- Support & SA- Strong Above
Scrip Last Close R1 R2 R3 SA S1 Monthly RS

ASTRAL POLY TECHNIK 1112.05 1121.71 1128.03 1134.34 1154.80 1068.2 48.1

PUNTER PICKS
Note: Positional trade and exit at stop loss or target whichever is earlier. Not an intra-day trade. A delivery based trade for a possible time frame
of 1-7 trading days. Exit at first target or above.
Note: SA-Strong Above, DP-Demand Point, SP- Supply Point, SA- Strong Above, RS- Strength

Weak Supply Supply RS-

Scrip BSE Code Last Close Demand Point Trigger
below point point Strength
INNOVATORS FACADE SY 541353 55.00 54.45 55.90 49.00 60.2 67.1 51.03
VARUN BEVERAGES LTD 540180 831.80 820.15 848.05 779.80 890.2 958.5 73.99

TOWER TALK
 Despite heavy provisions of ~Rs.508 crore because of its exposure to the IL&FS group, Yes Bank’s Q3 profitability
was barely dented. Other major management hurdles are also out of the way. Buy.
 REC remains one of the best investment bets despite the surge in its borrowing cost.
 Although egg and chicken prices are set to rise as the prices of soya and maize have risen, Venky’s (India) looks
attractive because of the company’s inherent position in the market.
 Ajanta Pharma plans to buy back its shares at Rs.1300/share. The company is faring well and the buyback is likely
to boost its share price. Buy.
 Bio-tech major Biocon’s Q3 PAT jumped over twofold and the management expects its workings to improve
further going forward. Buy for the long-term.
 PNB Housing Finance posted 32% higher PAT for Q3. Punjab National Bank and PNB Housing Finance both are
good investment bets.
 PVR posted 79% higher income for Q3. Its top-line has grown consistently. The best is yet to come. Buy.
 Sharda Cropchem sees higher demand for its agrochemical products. The management has declared an interim
dividend of 20%. Buy.

A Time Communications Publication 5

 Larsen & Toubro (L&T) posted excellent results for Q3 with 37% higher PAT. In spite of a slight dip in its order
book, buy L&T for great returns in the long term.
 Emami has acquired Crème 21, a German personal care brand, for about Rs.65 crore. This will strengthen its
foothold in the Middle East and North African countries. Accumulate.
 Sundaram-Clayton’s 9MFY19 PAT has already crossed the PAT recorded for FY18 and it declared a dividend of
400%. Buy.
 Wipro plans to double its campus hiring to manage it rapidly growing business. Buy for the long term.
 Onida eyes 8% growth in revenue for FY19. Mirc Electronics, which owns this brand, is a stock to reckon with in
the current times of turmoil. Buy.
 National Aluminium Co. expects PAT to grow to ~Rs.1600 crore in FY19 from Rs.1332 crore in FY18 and
revenues to grow to Rs.30000 crore from ~Rs.12000 crore over the next few years. This makes it an excellent buy.
 To avoid antimicrobial resistance (AMR), pharma companies have issued a warning against the excessive use of
antibiotics. Venus Remedies, one of the few companies that makes drugs to combat AMR, must be bought from a
long-term perspective.
 I.G. Petrochemicals is slated to notch an EPS of Rs.52+ for FY19. From a high of Rs.795, the stock has fallen sharply
and is available at a throwaway price of Rs.300. Buy immediately.
 Indian Oil Corporation posted 91% lower PAT for Q3 on account of inventory losses. However, the current beaten
down level makes this stock an excellent contrarian bet.
 Bajaj Auto has posted 20% higher PAT for Q3 and is faring well in the domestic as well as exports markets. Buy for
the long term.
 Jubilant FoodWorks posted excellent results for Q3 with 46% higher PAT. Its prospects look bright. Buy.
 NTPC has recommended a 1:5 bonus despite a flat Q3 performance. At the current beaten down level, the stock
looks attractive from the long-term perspective.
 Canara Bank’s Q3 PAT jumped twofold with a drop in bad loans. The improvement in its performance merits a
buy.
 An Ahmedabad-based analyst recommends Crest Ventures, IOL Chemicals & Pharmaceuticals and Jindal Saw.

BEST BET

Dhunseri Ventures Ltd

(BSE Code: 523736) (CMP: Rs.93.55) (FV: Rs.10)
By Bikshapathi Thota
Dhunseri Ventures Ltd (DVL) was incorporated as Dhunseri Tea Co. Ltd to cultivate and produce tea at its tea estates in
Assam. In 2009, it acquired the Bottle Grade PET Resin business of South Asian Petrochem Ltd at Haldia in West Bengal,
where-after its name was changed to Dhunseri Petrochem & Tea Ltd. It set up plants in Haldia and Egypt for its
Petrochem business. Pursuant to a Scheme of Arrangement in 2014, its Tea division was demerged and its IT SEZ
division was re-organized. In 2016, it entered into a Scheme of Arrangement with IVL Dhunseri Petrochem Industries
Pvt Ltd (IVL), where-after its PET Resin business in India was transferred to the latter. It then changed its name to
Dhunseri Ventures Ltd w.e.f. 11 December 2018.
DVL is engaged in the business of (i) treasury operations; (ii) trading Financials: (Rs. in crore)
in PET resins; and (iii) developing infrastructure facilities in special
economic zones (SEZs) for IT/ ITES (IT-enabled services) in West Particulars FY16 FY17 FY18 FY19E
Bengal through its subsidiary - Dhunseri Infrastructure Ltd. It has two Revenue 270 280 981 1162
subsidiaries in Singapore as well - Global Foods Pte Ltd and Twelve Expenses 80 220 947 1057
Cupcakes Pte. Ltd. It has three joint ventures – (i) IVL; (ii) Choicest
Enterprises Ltd (CEL); and (iii) Indorama Ventures Public Co. Ltd Net Profit -132 625 52 72
(IVPCL). IVL is engaged in manufacturing fine bottle grade PET resins. EPS (Rs.) -35 171 15 20
CEL is engaged in setting up franchisees for the well–known ‘UNO’ Dividend (Rs.) 4 2 3.5 4
brand of Chicago deep–dish pizzas. IVPCL is a global chemical Note: FY16 & FY17 figures include extraordinary
producer with a manufacturing capacity of 5,40,000 TPA. income and profit.

A Time Communications Publication 6

Conclusion: Promoted by the Dhanuka group of Kolkata, DVL is the second largest PET resin manufacturer in India
(after Reliance Industries) and among the top 15 PET resin manufacturers in the world. It operates like a holding
company with limited downside risk. Its Egyptian subsidiary i.e. Egyptian Indian Polyester Company S.A.E, which
resumed operations in August 2018, currently runs at 50% capacity utilization. The plant is expected to run at full
capacity utilization by March 2019, where-after it is likely to generate a top-line of $500 million.
DPL owns 50% stake in its Indian and Egyptian business operations, which works out to ~Rs.2200 crore. In addition, it
held cash and cash equivalents of Rs.222 crore as on 30 September 2018. Its Egyptian subsidiary has no term loans
while its Indian subsidiary has limited term loans. Thus, the company’s valuation works out to ~Rs.2400 crore.
Assuming a 50% holding company discount, its valuation works out to ~Rs.1200 crore as against its current market cap
of Rs.350 crore. The stock trades at 0.3x FY19E Book Value and 5x FY19E Earnings, which is very attractive. Therefore,
we have a Buy on the stock with a price target of Rs.180 (9x FY19E Earnings) within a year.

STOCK WATCH
By Amit Kumar Gupta

Shriram Transport Finance Co. Ltd

(BSE Code: 511218) (CMP: Rs.1043.85) (FV: Rs.10)
Incorporated in 1979, Shriram Transport Finance Company Ltd (STFC) is an asset-financing non-banking finance
company (NBFC) engaged in providing finance for commercial vehicles (CVs) and other loans. It finances pre-owned and
new heavy duty trucks; medium, intermediate and light duty trucks; pick-up and mini-trucks; passenger vehicles; farm
equipment; and construction vehicles and equipment. It offers tyre finance, engine replacement finance, working capital
loans, freight bill discounting products, etc. It also accepts non-cumulative and cumulative deposits. It serves small road
transport operators, first-time users, small truck owners and small construction equipment operators. As of 31 March
2018, it operated 1,213 branches and 862 rural centers.
During the quarter, STFC’s asset quality remained broadly stable with 1% lower NPA (non-performing assets) at
Rs.7641 crore. However, due to a 4% decline in loan book, gross non-performing assets (GNPA) came in at 8.78% v/s
8.64% while net NPA came in at 5.86% v/s 5.85%. The provision coverage ratio (PCR) stood at 35.28%. The
management expects credit cost to come down to around 2% next year on the back of strong collection efficiency. AUM
(assets under management) grew 14% YoY to Rs.1038 billion, aided by new CV, business credit and working capital
loans. New Vehicles loan book grew 25% YoY, constituting 11.6% of the total loan book. Business loans grew 48% YoY
while working capital loans grew 75% YoY, constituting 5.4% of the total loan book.
Rural AUM grew 31% YoY to Rs.370.7 billion. STFC expanded its reach in rural and semi-urban areas by opening more
branches, which is likely to boost disbursement in the Used CV segment going forward. Disbursement during the quarter
was Rs.95.5 billion, of which Rs.4 billion was towards New Vehicles, Rs.90 billion towards Used Vehicles and Rs.1.5
billion towards other segments.
The management has reiterated 15-18% growth in AUM in FY19 and higher growth in the securitised book. It expects
FY20 to see better growth in its CV segment on the back of BS VI implementation and increase in infra spend, which is
likely to push growth beyond 20%. STFC plans to hold 3 months additional cash in its balance sheet v/s 1-2 months
earlier in case of further tightening in systemic liquidity.
STFC had raised Rs.4300 crore through NCDs from two Tranches and the third Tranche of Rs.700 crore is in the pipeline.
It had also raised funds through the ECB (external commercial borrowings) route to the tune of $350 million in Q2FY19
and another $400 million is available to borrow from this window.
The CV financing industry is expected to grow at a higher pace next year on the back of increasing infra spending,
improving real estate demand and an uptick in rural economy. Further, pre-buying on implementation of BS VI norms
and mining activity is likely to accentuate demand.
Technical Outlook: The STFC share has formed a downward channel pattern on the daily chart and looks good for
medium-term investment. The stock trades below all important moving averages like the 200 DMA level on the daily
chart.
Start accumulating at this level of Rs.1043.85 and on dips to Rs.990 for medium-to-long term investment and a possible
price target of Rs.1190+ in the next 6 months.
*****

A Time Communications Publication 7

Ramco Cements Ltd
(BSE Code: 500260) (CMP: Rs.601.75) (FV: Re.1)
Incorporated in 1957, Chennai-based Ramco Cements Ltd (RCL) offers portland pozzolana cement (PPC), ordinary
portland cement (OPC), sulphate resisting cement, sleeper grade cement and rapid hardening portland cement. It also
offers ready mix concrete (RMC) and dry mortar products under the ‘RAMCO’ brand. It is also involved in the generation
and sale of electricity from wind mills and thermal power plants. As at 31 March 2018, it operated a wind farm with an
installed capacity of 125.95 MW comprising 108 wind electric generators. It is also engaged in exports. RCL delivered a
soft performance in Q3FY19, mainly marred by a sharp drop in average realisation. EBITDA came in ~7% lower (+2.5%
QoQ) at Rs.2.1 billion while unitary EBITDA stood at Rs.765 as against Rs.996 in Q3FY18 and Rs.830 in Q2FY19. Sales
volume grew 21% YoY and 11% QoQ to 2.75 million tonnes, mainly on account of higher demand in Eastern and
Southern markets. Average realisation declined by ~5% QoQ to Rs.4392/tonne led by a sharp price decline in the
Southern region. Notably, operating cost/tonne declined by 4% QoQ (Rs.165/tonne) to Rs.3627, mainly due to a sharp
QoQ drop in freight cost/tonne (+2% YoY and -7% QoQ) and other expenditures/tonne (-7% YoY and -8% QoQ). While
stronger volume growth and QoQ reduction in operating cost were the key positives, a sharp drop in average realisation
spoiled the show. However, its capex plans are likely to ensure sustainable volume growth. Realisation recoveries will be
the key catalyst for the stock performance in the medium-term. RCL’s revenue grew 15% YoY to Rs.12 billion owing to
healthy sales volume. We expect sales volume to clock ~15% CAGR through FY18-FY21E. Capacity expansion of 6.2
million tonnes at Rs.5550/tonne or $78/tonne without sweating its balance sheet with debt:equity at 0.3x (RCL expects
its interest bearing debt to peak out at Rs.15 billion from Rs.8.7 billion in FY18) bodes well for the company. Further,
continued traction in sales volume will aid in registering 11% CAGR in EBITDA through FY18-FY21E.
Technical Outlook: The RCL share has formed a possible double bottom pattern on the daily chart and looks good for
medium-term investment. The stock trades below important moving averages like the 200 DMA level on the daily chart.
Start accumulating at this level of Rs.601.75 and on dips to Rs.560 for medium-to-long term investment and a possible
price target of Rs.710+ in the next 6 months.

STOCK BUZZ
By Subramanian Mahadevan

Indoco Remedies Ltd: Prescription for healthy gains

(BSE Code: 532612) (CMP: Rs.176.90) (FV: Rs.2)
Indoco Remedies Ltd (Indoco) is a fully integrated, research-oriented pharma company engaged in the manufacture and
marketing of formulations i.e. finished dosage forms (FDFs) and active pharmaceutical ingredients (APIs). It has seven
decades of experience in the Indian pharma market and a strong foothold in the international market across 55
countries. It is a $165 million company employing 6,000+ people including 300+ skilled scientists. It has 9
manufacturing facilities, of which 6 are for finished dosages and 3 for APIs besides a state-of-the-art R&D center in Navi
Mumbai and a Clinical Research Organization in Hyderabad.
We strongly believe that Indoco is in recovery mode and on the sustainability curve. Stable revenues and lower cost will
improve the margins in the long run. It plans to penetrate in the US markets while focusing on the emerging markets of
Myanmar, South Africa, Kenya, etc. Exports contribute ~47% to the total sales. A ramp-up in exports will boost its
margins. However, the ramp-up in its US business will still take some quarters to get back to normal.
The management expects strong growth in the domestic market led by price and volume growth along with new product
launches. Going ahead, we expect Indoco’s top-line to record a YoY growth of 11.2% in FY20E to Rs.12590 million and
EBITDA at Rs.2007 million with EBITDA margin at 15.9%. The stock can easily deliver high double-digit returns within
two years. Its downside is limited. Buy on every decline.
*****

Rallis India Ltd: Worthy crop!

(BSE Code: 500355) (CMP: Rs.160.80) (FV: Re.1)
Rallis India Ltd (Rallis) is a Tata group owned agrochemical company. Tata Chemicals holds 50.09% in Rallis. Its plants
are located at Akola, Ankaleshwar, Ratnagiri and Bharuch. In FY11, it had acquired Bangalore-based seed player
Metahelix. In April 2012, it entered into an agreement to acquire 51% stake in Zero Waste Agro Organics.

A Time Communications Publication 8

Rallis offers a diversified product portfolio in terms of crops and pesticides. According to a customer engagement survey
by Gallop, it has 7 of the top 12 brands in the Indian agrochemical market. It has alliances with several global majors
such as Dupont, Syngenta, Bayer, etc. These tie-ups enable it to offer a bouquet of speciality products, addressing varied
crop protection needs.
Rallis is an established agrochemical player in India. With a market share of ~10%, it is well-placed to capture the
emerging opportunities in the domestic agrochemical market on the back of strong distribution network, branded farm
solutions and new product launches. The newly commissioned Dahej SEZ facility is anticipated to boost export sales,
which will reduce its dependence on the domestic markets. The organized hybrid seed market is expected to post a
CAGR of 12-15% in the coming years. India has a dismal ~2 mha (million hectares) of the total 40 mha under hybrid
seeds in rice crop, thus leaving enough room for penetrating into untapped markets. Post the acquisition of Metahelix,
Rallis is well equipped to ride this surge armed with the former’s formidable R&D capabilities and robust product
pipeline. Buy this stock on every decline for decent returns as there is minimum downside from the current level.

MARKET REVIEW

RBI policy to dictate trend

By Devendra Singh
The Sensex advanced 443.89 points to settle at
36469.43 while the Nifty closed 113.10 points
higher at 10893.65 for the week that ended on
Friday, 1 February 2019.
Finance Minister Piyush Goyal while presenting
the Budget FY2019-20 said that the country is
poised to become a $5-trillion economy in the
next five years and aspires to become a $10-
trillion economy in the next 8 years thereafter.
He also said that the past five years of Prime
Minister Modi-led government have witnessed a
wave of next-generation structural reforms,
which have set the stage for decades of high
growth. Besides generating high growth rate, the
government contained double-digit inflation and
restored fiscal balance. FM said that India is the
fastest-growing major economy in the world and
that the GDP growth in the past 5 years had been
higher than under any previous governments.
“India has witnessed its best phase of macro-
economic stability during this period. The
country is solidly back on track and marching
towards growth and prosperity. The last five
years have seen India being universally
recognized as a bright spot of the global
economy,” he added.
Fiscal deficit has been brought down to 3.4% in
the revised estimate of 2018-19. The deficit was
widely expected to be higher than targeted due
to a combination of revenue shortfalls and
increased spending ahead of the election. The
government estimates GDP growth to be at 7.2%
for the current fiscal instead of 6.7% estimated
earlier.
The International Monetary Fund (IMF) in its January 2019 ‘World Economy Outlook’ latest update said India will
remain the fastest growing major economies of the world.
One more successful year for
TF+ subscribers…
“Think Short-Term Investment…
Think TECHNO FUNDA PLUS”
Techno Funda Plus is a superior version of the Techno Funda
column that has recorded near 90% success since launch!
Every week, Techno Funda Plus identifies three fundamentally
sound and technically strong stocks that can yield handsome
returns against their peers in the short-to-medium-term.
Most of our recommendations have fetched excellent returns to
our subscribers. Of the 156 stocks recommended between 11
January 2016 and 2 January 2017 (52 weeks), we booked 2-43%
profit in 125 stocks, 28 triggered the stop loss of 1-21%.
Of the 156 stocks recommended between 9 January 2017 and 1
January 2018 (52 weeks), we booked 7-41% profit in 124 stocks, 30
triggered the stop loss of 2-18%.
Of the 99 stocks recommended between 8 January 2018 and 20
August 2018 (33 weeks), we booked 3-41% profit in 61 stocks, 11
triggered the stop loss of 4-8% while 27 stocks are still open.
If you want to earn like this,
subscribe to TECHNO FUNDA PLUS today!
For more details, contact Money Times on
022-22616970/22654805 or moneytimes.support@gmail.com.
Subscription Rate: 1 month: Rs.2500; 3 months: Rs.6000;
6 months: Rs.11000; 1 year: Rs.18000.

A Time Communications Publication 9

“India is projected to grow at 7.5% in FY19 and 7.7% in FY20, an impressive over one percentage point ahead of China’s
estimated growth of 6.2% in these two years, attributing the pick-up to the lower oil prices and a slower pace of
monetary tightening. While the Chinese growth rate has been on a downward slope, India has experienced an upward
trajectory in these years,” the report said.
“India’s economy is poised to pick up in 2019 benefiting from lower oil prices and a slower pace of monetary tightening
than previously expected as inflation pressures ease,” the report added. “Growth in emerging and developing Asia will
dip from 6.5% in FY18 to 6.3% in FY19 and 6.4% in FY20,” the IMF said. “India and France are likely to surpass the UK in
the world’s largest economy rankings in FY19, knocking it from the fifth to the seventh place in the global table,” the
report added.
The Food & Agriculture Organization’s (FAO) food price index, which measures monthly changes for a basket of cereals,
oilseeds, dairy products, meat and sugar, averaged 161.7 points in December 2018 v/s 161.6 in November 2018. In
2018, the index averaged 168.4 points, down 3.5% from 2017 and almost 27% below the highest level of 230 points
reached in 2011.
Key indices tumbled on Monday, 28 January 2018, on selling by the FIIs. The Sensex plunged 368.84 points to close at
35656.7 while the Nifty closed 119 points lower at 10661.55.
Key indices edged lower on Tuesday, 29 January 2019, on global cues. The Sensex fell 64.2 points to close at 35592.50
while the Nifty was down 9.35 points to close at 10652.2.
Key indices settled flat on Wednesday, 30 January 2019. The Sensex fell 1.25 points to close at 35591.25 while the Nifty
was down 0.4 points to close at 10651.8.
Key indices surged on Thursday, 31 January 2019, on consolidated buying by market participants. The Sensex gained
665.44 points to close at 36256.69 while the Nifty was up 179.15 points to close at 10830.95.
Key indices advanced further on Friday, 1 February 2019, on positive buying during the presentation of the Interim
Budget. The Sensex gained 212.74 points to close at 36469.43 while the Nifty closed 62.7 points higher at 10893.65.
National and global macro-economic figures along with Brexit developments will dictate the movement of the markets
and influence investor sentiment in the near future. Market participants will closely watch the Indian rupee trend
against the US Dollar, which is currently hovering around 71. The markets will take cues from the next RBI monetary
policy review meet, which is scheduled on 5 February 2019.

SHARE BUYBACK: A GREAT TOOL FOR LISTED COMPANIES

By Laxmikant Bhole
Over the last few years, share buybacks have become a popular and preferred way of distributing returns to
shareholders compared to dividends. The series of buybacks recently announced by Oil & Natural Gas Corporation,
NMDC, SKF India, Just Dial, Indian Oil Corporation, Bharat Heavy Electricals, Tata Investment, Dhanuka Agritech, BOSCH,
National Aluminium Co., etc. have created a buzz on Dalal Street. IT giants like Infosys, Tata Consultancy Services, HCL
Technologies, Mphasis, eClerx, etc. announced buybacks last year.
Why do listed companies announce buybacks? How do they benefit? Let’s understand. The most common interpretation
of a buyback is that the company is financially strong and no longer needs the level of equity funding. Generally,
companies that have excess cash i
n their kitty, with no specific requirement or deployment opt for buybacks. Companies can return/ reward the surplus
cash to shareholders in various forms: (i) Pay dividends [this, however, attracts tax in the form of dividend distribution];
(ii) Issue a bonus [this increases the equity burden of the company, which is not a healthy sign from the balance sheet
perspective]; and (iii) Buyback. Instead of carrying an unnecessary equity burden on the balance sheet, companies
prefer to reduce their equity in exchange for cash and buyback is the most lucrative and tax-efficient option to do this.
Buybacks offer multiple advantages to listed companies. Equity capital has various costs associated with it. Equity is a
liability and companies give returns to shareholders for this equity in the form of dividends. Higher the equity capital,
higher is the distribution of earnings. Hence, the cost of capital increases with the size of equity and thus a reduction in
equity capital is positive for the balance sheet.
Also, buybacks are EPS-accretive. EPS is calculated as PAT divided by the number of equity shares. So, if a company buys
back its own shares, its equity stands reduced which in turn leads to higher EPS. If the company earns the same profits
next year, shareholders will receive a higher chunk as the number of shareholders will stand reduced after the
buyback. Also, since the company has spent cash to buy back its shares, the cash on its balance sheet will also reduce

A Time Communications Publication 10

which in turn leads to higher RoE (return on equity). Shareholders who tender their stocks in the buyback programme
earn the market value along with the premium that the company may offer for the buyback.
A company can buy back its shares either
through the tender offer route or through
open market purchases. Under the tender MID-CAP TWINS: New promise & hope!
offer route, the company fixes a buyback Mid-Cap Twins is now steered by Mr. Dildar Singh Makani,
price and accepts shares at the offer price a stock market veteran of over 30 years and an avid corporate watcher.
from its shareholders. Shareholders who He has several profitable investment ideas to his credit.
wish to exit under the offer may fetch good
A fundamental analyst, Mr. Makani will hopefully reinvigorate Mid-Cap
returns if the offer price is fixed at a
Twins to the high level Money Times products are known for.
premium, which is usually the case. And
shareholders who do not tender their Here’s the performance review of the stocks recommended since Jan 2018
shares in the offer benefit by the long-term
Sr. Scrip Name Recomm. Recomm. Highest %
value created because of the resultant
No. Date Price (Rs.) since (Rs.) Gain
lower equity.
1 Stock A 01-01-18 59.25 71.90 21
In the other route, a company buys back
shares through open market purchases. It 2 Stock B 01-01-18 72.85 82.20 13
announces the maximum price and buys 3 Stock C 01-02-18 234.90 302.90 29
back shares from the market during the 4 Stock D 01-02-18 164.25 335 104
buyback period. But under this method, 5 Stock E 01-03-18 575.15 635.25 10
the company is not obliged to buy back the
entire quantity which was announced. 6 Stock F 01-03-18 211.80 216.80 2
Since an open market offer typically runs 7 Stock G 01-04-18 45.80 58.20 27
for a year, companies are likely to buy 8 Stock H 01-04-18 51 57.35 12
back their shares at a price lower than the 9 Stock I 01-05-18 107.55 117.70 9
maximum price announced. This 10 Stock J 01-05-18 320.45 360 12
enchances the shareholder value of those
who have not sold their shares. Simply 11 Stock K 01-06-18 46.9 76.60 63
put, a company can buy back its shares 12 Stock L 01-06-18 71.25 72.2 1
from the market at a lower price than 13 Stock M 01-07-18 109.05 116 6
earlier decided, which boosts the value of 14 Stock N 01-07-18 248.6 348 40
the remaining shareholders.
15 Stock O 01-08-18 433.4 433 -
A stock is a share of the ownership of a
16 Stock P 01-08-18 312.7 372.55 19
company including the right to vote on the
company’s policies and financial decisions. 17 Stock Q 01-09-18 575.5 667.75 16
A company that has an owner and 18 Stock R 01-09-18 252.2 257.75 2
1,00,000 shareholders, effectively has 19 Stock S 01-10-18 84 92.85 11
1,00,001 owners in the ratio of the 20 Stock T 01-10-18 236.4 368.35 56
number of shares they hold. Companies
21 Stock U 01-11-18 233.4 257.4 10
issue shares to raise equity capital to fund
their expansion plans. However, when 22 Stock V 01-11-18 951.25 1008 6
companies do not see any growth or The latest edition of ‘Mid-Cap Twins’ was released on
expansion opportunities, having excess
cash on the balance sheet is more of a
1 February 2019.
burden than a blessing. Since shareholders Happy reading & happier money making
seek returns on their investments, the best
as Mid-cap Twins enters its third year!
way for a company to reward its
shareholders is to return this cash in some Attractively priced at Rs.2000 monthly, Rs.11000 half yearly
form. While this reduces the equity burden and Rs.20000 annually,
of a company, it also boosts its share price ‘Mid-cap Twins’ will be available both as print edition or online delivery.
as the number of owners/ shareholders
also stand reduced after the buyback
which in turn slurps the liquidity in the market.

A Time Communications Publication 11

Financial analysis is a major component of fundamental analysis, which is a great tool for evaluating a company and
identifying undervalued opportunities in the market. Peaceful investing is all about identifying these opportunities at the
right time. Keep looking for such opportunities and invest for long-term gains. Happy investing!
Courtesy: www.profitpokket.com

EXPERT EYE

Polyplex Corporation Ltd: Bright prospects!

(BSE Code: 524051) (CMP: Rs.483.40) (FV: Rs.10)
By Vihari
Polyplex Corporation Ltd (PCL), which commenced operations in 1984 in a small town in India, has grown rapidly over
the years and has manufacturing and distribution operations in India, Thailand, Turkey, Brazil, USA, China and
Netherlands with active sales in all the major regional markets across the globe. It is setting up manufacturing
operations in Indonesia as well. Having begun with a single 4,000 TPA PET thin film line, PCL has emerged as one of the
largest producers of thin PET films globally. It offers a wide range of thin as well as thick PET films. Its state-of-the-art
plants produce BOPP (bi-axially oriented polypropylene), Blown Polypropylene (PP)/ Polyethylene (PE) and CPP films.
In addition, its integrated downstream capabilities of metallizing, silicone coating, offline chemical coating and extrusion
coating help deliver value-added products. It supplies to ~1,700 customers in 76 countries across Europe, Americas, the
Indian sub-continent, the Far East, Asia Pacific and the Middle East.
PCL has invested into the fast-growing beverages market in India through its subsidiary - Peninsula Beverages & Foods
Co. Pvt Ltd (PBF), which is a wholly-owned subsidiary of Polyplex (Asia) Pte (Singapore). PBF is engaged in the business
of product development, branding, marketing and distribution of packaged beverages and food products, which is a
significant and fast-growing category in the consumer products space. Further, as part of its concentric diversification
strategy, PCL has recently started a new thick PET film line in Thailand which has enabled access to several new
applications.
PCL’s overseas revenue contributes 75% to its total revenue and 85% of its products find application in food and
consumer goods sectors. It derives 71% of its revenue from PET films, 3% from PET chips, 8% from its coating business,
13% from BOPP films and 5% from CPP and others. For FY18, it reported 23% higher PAT of Rs.284.1 crore on 12%
higher sales of Rs.3572 crore and an EPS of Rs.50. For Q2FY19, it reported 151% higher consolidated PAT of Rs.90 crore
on 23% higher sales of Rs.1173 crore and an EPS of Rs.28. For H1FY19, it reported 193% higher PAT of Rs.274.7 crore
on 33% higher sales of Rs.2239 crore and an EPS of Rs.47. It paid 400% dividend for FY18.
With an equity capital of Rs.32.6 crore and reserves of Rs.2516 crore, PCL’s share book value works out to Rs.782. Its
cash and bank balance and loans given stood at Rs.926 crore as at FY18. The value of its gross block was Rs.4107 crore.
Debts amounted to Rs.862 crore. Investments in bonds/debentures were Rs.133 crore. The promoters hold 50.03% of
the equity capital, Mutual Funds hold 4.59%, which leaves 45.38% stake with the investing public.
Bottle grade PET resins, which are used in consumer products like mineral water bottles, carbonated soft drinks, etc,
have potential for growth as more products like beer shift from traditional forms of packaging to PET bottles. The BOPP
and CPP businesses are also witnessing similar dynamics. The strong growth witnessed in Asia especially China and
India is expected to continue in the long term. PCL produces PET films largely for application in packaging, electrical
and other industrial end-user segments like hot stamping foils, thermal lamination, cable wrap, release films, air
conditioning ducts, etc. With its entry into thick PET films, its product range stands further diversified with increased
emphasis on electrical, imaging and graphics segments. Packaging being the largest business segment globally, PCL is
now in the position to offer other substrates used in the flexible packaging industry. BOPP and CPP films are PP-based
films, which are pre-dominantly used in packaging besides certain industrial applications like tapes, labels, thermal
lamination and textiles. Flexible packaging companies supply their laminates to consumer product companies for
packaging of a diverse range of products like food products, household goods, personal care products, etc.
The global thin PET film market is expected to grow at ~7% over the next few years. Its demand in India and other
countries of Asia is likely to grow at a higher rate of 8-10%. Companies like PCL, which offer a diverse range of quality
products with operations in the overseas markets, stand a better chance of participating in the market growth and
improving their margins.
PCL is confident that with its strengths of distributed manufacturing operations, a diversified product portfolio,
consistent quality, access to international customers, efficient supply chain model, higher proportion of value-added

A Time Communications Publication 12

products and a conservative balance sheet, it should be able to grow profitably and withstand volatility in the industry.
PCL is well poised to capture growth opportunities in all its business segments.
Based on its current going and
expansion initiatives, PCL is
expected to notch a
Released on 1st January 2019
consolidated EPS of Rs.88 or
more in FY19. At the current
Winners of 2019
market price of Rs.483.40, the Stocks set to perform with quarterly reviews!
stock trades at a forward P/E
Here is the Performance Review of ‘Winners of 2018’
of 5.5x. A conservative P/E of
8x will take its share price to Sr. 29-12-17 High of
Rs.704 in the medium term. Scrip 27-12-18 % Gain
No. Closing 2018
The stock’s 52-week high/ low 1 RADICO KHAITAN 293.35 399.7 500 70.44
is Rs.667.75/ Rs.408. 2 JSW STEEL 269.7 293.25 427.3 58.44
****** 3 SONATA SOFTWARE 278.65 300.45 428.75 53.87
4 TAJ GVK HOTELS & RES 176 180.25 263.8 49.89
Pondy Oxides & 5 JINDAL SAW 140 82.7 182 30

Chemicals Ltd: 6
7
HAVELL'S INDIA
ESCORTS
562.15
787
685
686
729
1019
29.68
29.48
Available cheap 8 OBEROI REALITY 479.8 453.5 609.4 27.01
(BSE Code: 532626) (CMP: 9 CITY UNION BANK 163.54 185.15 207.15 26.67
Rs.350.50) (FV: Rs.10) 10 TATA SPONGE IRON 990 852 1248 26.06

Pondy Oxides & Chemicals Ltd 11 GUJ.ALKALIES & CHE 744 526 932 25.27

(POCL) was set up as a 12 MARICO 322.15 376.7 397 23.23

partnership firm in 1992. In 13 ELECTROSTEEL CASTI 37.8 21.25 44.6 17.99
1993, it started trading in zinc 14 LARSEN & TOUBRO 1257 1423 1470 16.95
and lead sub-oxide and 15 BIRLA CORPORATION 1150 601 1290 12.17
gradually forayed into the 16 TAMILNADU NEWSPR 445.7 251.45 499 11.96
manufacture of zinc oxide. 17 RAMCO CEMENTS 786 641 879 11.83
Thereafter, it set up a 18 HIMATSINGKA SEIDE 399.6 217.85 444.35 11.2
manufacturing facility in 19 BHARAT FORGE 732 501 800 9.29
Puducherry. POCL was then 20 UNITED SPIRITS 734 629 800 8.99
incorporated in 1995 to take
21 TORRENT POWER 282.55 259.85 306.95 8.64
over the business of the
22 GODREJ INDUSTRIES 605 530 657 8.6
partnership firm for
23 DREDGING CORPORA 853 359 920 7.85
Rs.75,00,000. In 1996, it raised
Rs.1.71 crore through its IPO of 24 GSFC (GUJ.STATE FER 156.1 108.8 166.3 6.53

1,705,700 equity shares priced 25 JET AIRWAYS 831.3 269.8 883.65 6.3
at Rs.10/share to enhance the 26 E.I.D. PARRY (I) 370.05 204.2 391.95 5.92
capacity of zinc and lead sub- 27 MANAPPURAM FINA 123.3 89.8 130.45 5.8
oxides and set up a plant to 28 HINDALCO INDUSTRI 273.7 220.65 283.95 3.74
produce litharge and red lead. 29 SADBHAV ENGINEERI 425.9 206.55 438.85 3.04
After the demerger of some of 30 INDRAPRASTHA GAS 334.95 265.55 344.2 2.76
its businesses, it is now 31 CENTURY TEXT.& IN 1435 897 1472 2.58
focused on the lead acid 32 GUJARAT STATE PETRO 226.6 175.45 229.55 1.3
battery segment as majority of
its sales is derived from lead 2018 has been a difficult year for mid-caps and small-caps but all our 32 stocks
and lead alloys. managed to post a gain at their respective highs
In FY17, POCL enhanced the For just Rs.6000, book your copy of the 14th edition and welcome the
production capacity of lead New Year in the company of ‘Winners of 2019’!
metal and alloys from 32,140
TPA to 46,636 TPA. To For subscription details contact us on 022-22616970 or email us at moneytimes.support@gmail.com
strengthen its raw material
sourcing, it developed long-

A Time Communications Publication 13

term relationships with partners from different parts of the world and has also achieved cost advantage during the
process. It is now expanding capabilities of sourcing raw materials and developing techno-commercial processes for
processing the same. It maintains a balance between sales in the domestic and the export markets safeguarding itself
from the adverse effects of heavy dependence on any specific country’s economy. Its products are used by battery
manufacturing companies.
For FY18, POCL reported 3% higher PAT of Rs.29.3 crore on 24% higher sales of Rs.940 crore and an EPS of Rs.52.
Exports constituted 55% of sales and a dividend of 30% was paid. For Q3FY18, it reported 42% higher PAT of Rs.11.2
crore on 7% higher sales of Rs.255 crore and an EPS of Rs.20. For 9MFY19, it reported 44% higher PAT of Rs.31.8 crore
on 16% higher sales of Rs.804 crore and an EPS of Rs.57.
With an equity capital of Rs.5.6 crore and reserves of Rs.93.1 crore, POCL’s share book value works out to Rs.176. The
value of its gross block stood at Rs.43 crore. The promoters hold 46.3% of the equity capital, which leaves 53.7% with
the investing public.
POCL continues to tap new customers in different countries and also maintain good relations with its existing customers
because of which it needs to expand capacity. For this purpose, it has successfully commissioned a new state-of-the-art
secondary smelter in Andhra Pradesh.
POCL is currently focusing on the lead acid battery segment as most of its revenue is derived from the sale of lead and
lead alloys. The lead acid battery segment can be primarily divided into two segments: Automotive and Industrial. The
Automotive segment contributes over 60% of the total lead acid battery market in India. This segment is growing
rapidly as the number of vehicles in India is rising. Moreover, there is a huge demand for replacement batteries required
by vehicles. Industrial batteries are used for various applications like standby power source (uninterrupted power
supply [UPS] and Inverters), telecom, railways and motive power (golf carts and material handling equipments like
forklifts).
India is moving towards digitization and automation, which requires large use of batteries. The number of users of
mobile phones is increasing exponentially on a YoY basis making India the fastest growing telecom market.
The lead batteries market in India is currently estimated at ~Rs.40000 crore. Over thousands of domestic players
continue to recycle through recovery of lead from telecom, UPS, inverters, renewable energy and other related
industries.
We foresee 10-12% growth p.a. in the Indian lead acid battery market over 2015-20. The share of new emerging
applications of batteries like Solar, E-Bike, E-Auto will be substantial. By 2020, India may surpass Europe and will be the
third largest consumer of lead with expected demand of over 2.2 million tonnes.
POCL remains optimistic about the growth of the batteries segment in Asia. Other Asian countries like South Korea,
Indonesia, Japan and India are adding capacities for the manufacture of lead acid batteries. POCL has the world’s largest
integrated medium valve regulated lead acid battery plant. Although the primary lead capacity remains static, the
demand for secondary lead is growing YoY and is expected to maintain the trend going forward.
POCL has performed well in line with market expectations. This was possible due to its dynamic approach in terms of
raw material sourcing, maintaining price risks in terms of metals and foreign exchange exposure and upgrading its
expertise and technology. Its global presence gives access to local materials from different parts of the world at a
competitive cost.
The POCL share looks attractive given its low equity and high earnings. POCL is likely to notch an EPS of Rs.80 for FY19.
At the CMP of Rs.350.50, the stock trades at a forward P/E of 4x. A reasonable P/E of 8x will take its share price to
Rs.640.

TECHNO FUNDA

Amarjothi Spinning Mills Ltd

(BSE Code: 521097) (CMP: Rs.95.75) (FV: Rs.10)
By Nayan Patel
Amarjothi Spinning Mills Ltd (ASML) manufactures yarn. It owns 11 wind mills for captive consumption. Its services
include dyeing and blending. It dyes fibres including cotton, organic cotton, viscose, modal, polyester, excel, bamboo and
acrylic; yarn including cotton yarn, organic cotton, cotton or viscose yarn, cotton or modal yarn, cotton or polyester yarn,
cotton or excel yarn and cotton or bamboo yarn; specialized yarn which is suitable for discharge printing, post

A Time Communications Publication 14

mercerizing and post bleaching. It manufactures blended melange yarns, non-blended yarns and other yarns including
discharge printing yarn, anti-bacterial yarn and perfumed yarn. It dyes yarn for hosiery, woven and home textiles.
With an equity capital of Rs.6.75 crore and reserves
Financial Performance: (Rs. in crore)
of Rs.104 crore, ASML’s share book value works out
Particulars Q3FY19 Q3FY18 9MFY19 9MFY18 FY18
to Rs.170. Its P/BV ratio stands at just 0.6x. The
promoters hold 55.05% of the equity capital, which Sales 49.59 41.33 163.26 139.62 189.45
leaves 44.95% stake with the investing public. Well- PBT 3.57 3.43 16.79 10.48 12.97
known investors hold stake in this company: Anil Tax 0.71 0.69 3.36 2.10 1.05
Kumar Goel 3.24%, C.H. Kiron 2.54%, Subramanian PAT 2.86 2.74 13.43 8.39 11.93
P. 2.16% and Anirudh Mohta 1.38%. EPS (Rs.) 4.23 4.06 19.9 12.42 17.69
For Q3FY19, ASML posted 4% higher PAT of Rs.2.86 crore on 20% higher sales of Rs.49.59 crore and an EPS of Rs.4. For
9MFY19, it posted 60% higher PAT of Rs.13.43 crore on 17% higher sales of Rs.163.26 crore and an EPS of Rs.20. It
recommended 20% dividend for FY18.
The ASML share is available at around 45% discount to its 52-week high of Rs.175 and looks attractive at the current
level based on its valuations. Investors can buy this stock with a stop loss of Rs.80. On the upper side, it could zoom to
Rs.130-150 levels in the medium-to-long term.
*****

Arvind Smartspaces Ltd

(BSE Code: 539301) (CMP: Rs.125.95) (FV: Rs.10)
Incorporated in 2008, Arvind SmartSpaces Ltd (ASL) belonging to the reputed Arvind group is a leading real estate
development company with approximately 8 million sq.ft. of real estate development across India. Apart from
Ahmedabad, it has real estate developments across Gandhinagar, Bangalore and Pune with aggressive plans to expand to
other parts of the country.
ASL has an equity capital of Rs.35.1 crore supported Financial Performance: (Rs. in crore)
by reserves of Rs.190.58 crore. The promoters hold Particulars Q3FY19 Q3FY18 9MFY19 9MFY18 FY18
59.83% of the equity capital, which leaves 40.17% Sales 77.26 32.51 149.47 93.98 198.25
stake with the investing public.
PBT 15.17 6.95 20.27 22.12 48.34
For Q3FY19, ASL reported 126% higher PAT of Tax 5.02 2.31 7.16 7.79 16.90
Rs.10.2 crore on 138% higher income of Rs.77.26 PAT 10.2 4.51 13.20 13.93 30.17
crore and an EPS of Rs.2.9. For 9MFY19, it reported
EPS (Rs.) 2.91 1.42 3.85 4.7 10.01
marginally lower PAT of Rs.13.2 crore on higher
income of Rs.149.5 crore and an EPS of Rs.3.9.
Commenting on the results of the company, Mr. Kamal Singal, its Managing Director and CEO, said, "Arvind SmartSpaces
has maintained its performance on QoQ basis since its listing 4 years back and is likely to maintain the growth momentum.
We have already delivered 7 projects of ~2.8 million sq.ft. and have another 7 projects totaling 7 million sq.ft. under various
stages of development, which are likely to be completed in the next 3-4 years. We recently added 2 new projects (one each in
Bangalore and Pune) and are continuously looking at strengthening our project pipeline further for the next quarter. Our
aim is to achieve a turnover of Rs.1000 crore in the next 4 years.”
Currently, the stock trades at a P/E of 15x and is available at around 41% discount to its 52-week high of Rs.214.
Investors can buy this stock with a stop loss of Rs.100. On the upper side, it could zoom to Rs.175-200 levels in the
medium-to-long term.

BULL’S EYE

Granules India Ltd

(BSE Code: 532482) (CMP: Rs.89.10) (FV: Re.1)
By Pratit Nayan Patel
Company Background: Incorporated in 1991, Granules lndia Ltd (GIL) is a vertically integrated pharmaceutical
company producing active pharmaceutical ingredients (APIs), pharmaceutical formulation intermediates (PFIs) and
finished dosages (FDs). It serves around 250 customers across 60 countries through offices in India, USA and UK. With a
strong presence across all three verticals, GIL has emerged as a leader in the off-patent drugs segment and ‘first line of

A Time Communications Publication 15

defense’ products such as Paracetamol, Ibuprofen, Metformin and Guaifenesin. It owns one of the largest PFI and single
site FD facilities in the world. It also owns large Paracetamol API facilities apart from 4 operational plants in Hyderabad
and 1 in Vizag. Exports constitute over 80% of the total revenue.
Financials: GIL has an equity capital of Rs.25.42 crore supported by huge reserves of Rs.1389.62 crore. The promoters
hold 44.87% of the equity capital, FIIs hold 9.72% and DIIs hold 3.03%, which leaves 42.37% stake with the investing
public.
Performance Review: For Q3FY19, GIL reported Performance Review: (Rs. in crore)
72% higher PAT of Rs.60.32 crore on 54% higher
Particulars Q3FY19 Q3FY18 9MFY19 9MFY18 FY18
sales of Rs.631.78 crore and an EPS of Rs.2.4. For
9MFY19, it reported 54% higher PAT of Rs.172.37 Sales 631.78 410.73 1665.88 1188.03 1691.85
crore on 40% higher sales of Rs.1665.88 crore and PBT 86.78 51.92 241.30 166.05 195.99
an EPS of Rs.6.8. Its 9MFY19 PAT was almost 30% Tax 26.46 16.90 68.93 53.90 63.4
higher than the PAT recorded for FY18. It paid
100% dividend for FY18 and 75% interim dividend PAT 60.32 35.02 172.37 112.15 132.59
for FY19. EPS (Rs.) 2.37 1.38 6.78 4.72 5.49
Industry Overview: India accounts for ~3.1-3.6% of the global pharmaceutical industry in terms of value and ~10% in
terms of volume. India’s pharmaceutical exports, which stood at $16.4 billion in 2016-17, are expected to grow 30% to
$20 billion by 2020. India exports drugs to over 200 countries in the world and USA is a key export market. Exports
contribute over 50% to the Indian pharmaceutical industry’s turnover but its contribution at the EBIDTA level is higher
owing to relatively superior realisations. Around 20% of exports are accounted for by generic drugs in terms of volume,
which is expected to rise further making India the largest contributor of generic medicines in the world. The Indian
pharmaceutical industry appears set for a sharp turnaround in FY19 on the back of strong growth in the overseas
market, particularly in the regulated markets of the US and the EU, aided by healthy growth in the domestic market.
Mr. Krishna Chigurupati, Chairman & Managing Director of GIL, said ”We are pleased with the strong growth in revenue
and PAT for this quarter compared to the previous corresponding quarter, driven by better sales from the FD segment and
higher contribution from the North American market. The progress in 9MFY19 is also very encouraging. During this period,
our revenue and PAT have grown significantly compared to the previous corresponding period. The results of our
concentrated efforts are visible in our sustained margins of over 18% for the reporting quarter and year till date financials.
Fiscal prudence has enabled us to improve our debt ratios and working capital cycle. In this quarter, contribution from our
JVs was sluggish due to the cyclical nature of our CRAMs business and the routine annual maintenance shut-down at our JV
facility in China. But we expect the JVs to contribute meaningfully in the subsequent quarters. We have surpassed the targets
we set for ourselves for the current financial year in the first nine months itself and the performance of the fourth quarter
will augment current growth. We will continue to deliver sustainable results in coming years by launching new products
and optimally utilizing our capacities.”
Conclusion: Over the years, GIL has evolved itself from an API manufacturer to a vertically integrated company with a
strong presence across the value chain in the global pharmaceutical industry. The management’s adequate focus on top-
line growth and margins has ensured value on the table for all its stakeholders - vendors, customers, employees, the
government and shareholders.
Currently, the stock trades at a P/E of 12x and looks attractive at this level. Investors can accumulate the stock between
Rs.92-82 in a staggered manner with a stop loss of Rs.72 for a price target of Rs.150-160 in the next 15-18 months. The
stock’s 52-week high/low is Rs.132.20/ Rs.71.75. Its market cap stands at Rs.2265 crore.

A Time Communications Publication 16

 Early Bird Gains – A Performance Review
Early Bird Gains (EBG), our newsletter specializing in multi-baggers, has performed well for the last
15 years. Here’s the performance review of the 52 stocks featured between 27 th September 2017
and 26th September 2018.
Issue Date of Recomm. Highest since Gain
Scrip Name
No. Recomm. Price (Rs.) (Rs.) %
1 GHCL 27-09-17 210.55 357.50 70
2 Gitanjali Gems 04-10-17 67.20 104.80 56
3 Vivimed Labs 11-10-17 132.85 137.25 3
4 Mangalam Organics 18-10-17 86 510 493
5 Kriti Nutrients 25-10-17 23 56.95 148
6 Premier Explosives 01-11-17 427.70 536.25 25
7 N.R. Agarwal Industries 08-11-17 297.80 615.85 107
8 Sintex Industries 15-11-17 25.20 28 11
9 Larsen & Toubro Infotech 22-11-17 975.85 1469.60 51
10 KPIT Technologies 29-11-17 177.70 314.80 77
11 Talwalkar Better Value Fitness 06-12-17 302.15 358.05 18
12 Security and Intelligence Services (India) 13-12-17 1261.25 1404.80 11
13 Elnet Technologies 20-12-17 190.40 204 7
14 Kellton Tech Solutions 27-12-17 103.10 137 33
15 Lupin 03-01-18 875.70 986 13
16 International Paper APPM 10-01-18 383.35 591.15 54
17 Star Paper Mills 17-01-18 293.10 318.20 8
18 Steel Strips Wheels 24-01-18 1124.30 1473.70 31
19 Yes Bank 31-01-18 353.45 404 14
20 Lincoln Pharmaceuticals 07-02-18 215.10 314 46
21 Dewan Housing Finance Corporation 14-02-18 524.55 690 31
22 Just Dial 21-02-18 439.30 637.80 45
23 Jindal Poly Films 28-02-18 351.60 362.55 3
24 KSE 07-03-18 2497.55 4000 60
25 Rico Auto Industries 14-03-18 71.60 87.25 22
26 Virinchi 21-03-18 105.60 137 30
27 Honeywell Automation India 28-03-18 16466 24178 47
28 Jay Bharat Maruti 04-04-18 482.85 528.90 9
29 Bodal Chemicals 11-04-18 137.10 156.25 14
30 Simmonds Marshall 18-04-18 125.80 154.90 23
31 Mahanagar Gas 25-04-18 908.35 984.40 8
32 Hinduja Global Solutions 02-05-18 957.05 974.75 2
33 Mishra Dhatu Nigam 09-05-18 135.55 160.40 18
34 Pondy Oxides & Chemicals 16-05-18 414.10 452.70 9
35 Manaksia 23-05-18 54.90 60 9
36 RACL Geartech 30-05-18 65.40 75.50 15
37 Sintex Industries 06-06-18 15.05 17.85 19
38 Natco Pharma 13-06-18 791.95 849 7
39 UFO Moviez India 20-06-18 366.60 396 8
40 Sharda Cropchem 27-06-18 365.45 424 16
41 Vindhya Telelinks 04-07-18 1008.55 1698.80 68
42 Pix Transmissions 11-07-18 174.40 284.40 63
43 Meghmani Organics 18-07-18 86.80 99.05 14
44 Federal Bank 25-07-18 87.70 92.75 6
45 Everest Industries 01-08-18 486.15 597.50 23
46 Rites 08-08-18 275.25 326.55 19
47 International Paper APPM 15-08-18 459.45 591.15 29

A Time Communications Publication 17

 48 Patel Engineering 22-08-18 52.30 53 1
49 Jindal Poly Films 29-08-18 280.15 324.95 16
50 Shreyans Industries 05-09-18 179.30 202.35 13
51 Eimco Elecon (India) 12-09-18 368.65 390 6
52 Jasch Industries 19-09-18 62.30 67 7

Subscription Rate: 6 Months: Rs.4000, 1 Year: Rs.7000,

2 Years: Rs.12000, 3 Years: Rs.15000
For more details, contact Money Times on 022-22616970/22654805 or moneytimes.support@gmail.com

Editorial & Business Office: Goa Mansion (Gr. Floor), 58 Dr. S.B. Path (Goa St.), Near GPO, Fort, Mumbai – 400 001.
Phone: 022-2265 4805, 2261 6970.
Editor & Publisher: R.N. GUPTA
Asst. Editor & Associate Publisher: NEHAR SAKARIA
CHENNAI: T.A.S. Venkatasubba Rao (Phone: 044-24917241, Mobile: 9444024664)
JAIPUR: Satram Das (Phone: 0141-2636341)
DELHI: P. K. Vasudevan (Mobile: 9810513247)
All rights reserved. No portion of this publication may be copied or reproduced without the written permission of the publisher.
Any infringement of this condition will be liable to prosecution.
Printed & Published by R.N. Gupta for the proprietors Time Communications (India) Ltd. and printed by him at Inquilab Offset Printers Ltd. 156,
DJ Dadajee Road, Tardeo, Mumbai - 400072. Registration No.: 63312/91, Post Regn. No. MCS/006/2015-17

Disclaimer: Investment recommendations made in Money Times are for information purposes only and derived from sources that are deemed to
be reliable but their accuracy and completeness are not guaranteed. Money Times or the analyst/writer does not accept any lia bility for the use of
this column for the buying or selling of securities. Readers of this column who buy or sell securities based on the information in this column are
solely responsible for their actions. The author, his company or his acquaintances may/may not have positions in the above mentioned scrip.

A Time Communications Publication 18

 Subscription Form
Please fill in the subscription coupon in CAPITAL LETTERS only and send it to:
The Subscription Manager
Time Communications (India) Ltd.
Goa Mansion (Gr. Flr.), 58, Dr. S.B. Path (Goa St.), Near G.P.O., Fort, Mumbai – 400 001.
Tel. Nos.: 022-22654805, 22616970, Email: moneytimes.support@gmail.com, Website: www.moneytimes.in
I wish to subscribe to:
FUNDAMENTAL PRODUCTS TECHNICAL PRODUCTS
MEDIUM-TO-LONG-TERM: PRE-MARKET DAILY:
Money Times (Post/Courier/Online) Nifty & Bank Nifty 1 mnth = Rs.3500, 1 yr = Rs.30000
 1 yr = Rs.1000,  2 yrs = Rs.1900,  Nifty Options 1 mnth = Rs.1500, 1 yr = Rs.12000
3 yrs = Rs.2700 LIVE MARKET DAILY:
Early Bird Gains (Courier/Online) Live Market Calls (Cash & Futures)
 6 mnths = Rs.4000,  1 yr = Rs.7000,  1 mnth = Rs.4000,  1 yr = Rs.36000
 2 yrs = Rs.12000,  3 yrs = Rs.15000 FRESH ONE UP TREND DATA
Panchratna (Courier/Online) Fresh One Up Trend Daily
 1 qtr = Rs.2500,  2 qtrs = Rs.4000,   1 mnth = Rs.2500,  1 yr = Rs.25000
1 yr = Rs.7000 Fresh One Up Trend Weekly
Mid-Cap Twins (Courier/Online) 1 mnth = Rs.2000,  1 yr = Rs.18000
1 Mnth = Rs.2000, 6 Mnths = Rs.11000 Fresh One Up Trend (Mnthly/Qtrly/Yrly) 1 yr= Rs.17000
1 yr = Rs.20000 Fresh One Up Trend /Down Trend Futures Daily
Beat the Street 6 (Courier/Online) 1 mnth = Rs.4000,  1 yr = Rs.36000
 1 qtr = Rs.2000,  2 qtrs = Rs.3500, PROFITRAK TRENDS
 3 qtrs = Rs.5000,  1 yr = Rs.6500 Profitrak Daily
SHORT-TERM (1 wk – 3 mnths):  1 mnth = Rs.2500,  3 mnths = Rs.7000
Techno Funda Plus (Courier/Online)  6 mnths = Rs.13000,  1 yr = Rs.20000
 1 mnth = Rs.2500,  3 mnths = Rs.6000, Profitrak Weekly 1 yr = Rs.24000
 6 mnths = Rs.11000, 1 yr = Rs.18000 Profitrak Short-Term Gains 1 yr = Rs.8000
Profitrak Medium-Term Gains 1 yr = Rs.8000
Profitrak Winners Long-Term Gains  1 yr = Rs.6000
POWER OF RS 1 yr = Rs.3100
(For courier delivery, add Rs.40 per issue or Rs.2080 per year to the subscription amount.
No cancellation/ refund of subscription will be entertained)
a)  I am enclosing Demand Draft/Cheque No. ________________ payable at par in Mumbai favouring
‘Time Communications (India) Ltd.’ dated _____________ on _____________________________ at Branch
______________________________________ for Rs. _____________.
b) I have deposited Cash or electronically transferred Rs._____________ via RTGS/NEFT to:
 Time Communications (India) Ltd. State Bank of India 10043795661, Fort Market Branch, Fort, Mumbai - 400 001
(IFSC: SBIN0005347) or
 Time Communications India Limited ICICI Bank 623505381145, Fort Branch, Mumbai - 400 001
(IFSC: ICIC0006235) and have advised you about Transfer No. _______________________ by e-mail / phone.
c)  I am aware that investment in equities is risky and stock performance is unpredictable and can result in losses
in spite of all analysis and projections.
Name:
Address:

City: Pin:

Tel No Mob
Email:
Are you a  Investor,  Trader,  Broker/Sub-Broker,  Investment Advisor,  Banker

Date & Place: ___________________________________ Signature: ______________________

A Time Communications Publication 19