Buy Marksans Pharma@101.65.

This is one of those mid-sized pharma companies, where if you actually look at it in terms of stock price, then they have done phenomenally well because most of the company's business comes from regulated overseas markets such as UK and Australia. The company has subsidiaries through which it is been able to sell a mixture of OTC and generic products. But what really sets the company apart is its softgel capsule business.

There is less competition in this segment and the price erosion as compared with the other generic spaces is low. Among the new findings that Marksans has, a bulk of them is within the SGC space. So, that is the strategy that will incrementally help) the company them in the time to come 

A couple of two-three months back the company acquired a US-based company that deal in any case is cash accretive and EPS accretive. Going forward, thwill provide a front end for their US operations. The US SGC market is actually also one of the key positives for the company. The company's Goa facility is USFDA approved. So, a lot of positives are really for a company of its size. We expect Marksans to really report stronger earnings as quarters go by.

So fundamentally its a buy for a target of 150+ in next 1 year.

Buy Mahindra Holidays & Resorts @ 397. This is pure fundamental call for next 2-3 years.

To know more details about the company please refer the link mentioned below.

http://www.moneycontrol.com/news/stockstowatch/here7thingsyoushouldknowaboutmahindraholidays_3671721.html

JK Tyre Buy@105, Technical Breakout...

Buy Fedders Loyd@77
Buy DCB@141 , further details will follow soon.

Long term view of Nifty becoming better and better with the ongoing correction. No need to get panic.Corrections are part of market life cycle, instead of becoming panic, be brave and start investing in a systematic way. I can see huge return for next 3-5 years. You can start buying following scripts.

DCB Bank
Edelweiss Finance
NCC
Prism Cement
Sanghi Industries
Sahyadri Industries
Coral India Finance
Marksan Pharma
NMDC

Buy JK Tyre - CMP:92  Target:114.7  for Short Term, may be for next 6 month.

JK Tyre from technical point of view its very clear breakout around 90s, headed towards 110+. Fundamentally, oil and rubber prices hitting low, which is going add profit margin of company in a significant way.So its perfect buy.

Buy Edelweiss            - CMP:64  Target:100+ in 1 year. 
Buy Sanghi Industries- CMP:60  Target:100+ in 1-2 years.
Buy Coral India Fin -    CMP:56  Target: 90+ in 1-2 years.

More details will follow soon.

Buy DCB Bank(CMP:138, TP:200+) and Sahyadri Industries(CMP:102,TP:175+).

On 15-Apr-2015 DCB was recomonded to buy at 115, now its 138. I still feel its worth buying even now for a possible target of 200+ in next 1-2 years.Company's NPA is stable with increasing presence across the country.Narendra Modi led central government is taking all required necessary steps to strengthen the economy is going to increasing banking sector in a big way.


Sahyadri Industries was recommonded on 28-May-2015 at 71, now its 103. Big investors(HNI) has entered the script at 86. It might grow multifold.One can buy and hold it for long term.Business model is quite simple and strong, with excelent presence across the country and sub-continental.

Buy Sahyadri Industries- CMP:71 Target:100+ in 1 year.
Sahyadri Industries Ltd(SIL) is a flagship company of the Patel Group from Pune (Maharashtra, India).Well known for its Swastik brand of Fiber cement roofing sheets .Its an ISO 9001 : 2008 certified, SAP Enabled and BSE listed company. It’s a player in the building material space for over 6 decades now. SIL has pioneered making the double width machines in the world and the templates required for the same.

SIP has plants across Western and Southern India in below location:

1. MAHARASHTRA 2 PLANTS

2. GUJARAT 1 PLANT

3. TAMILNADU – 1 PLANT

4. AP – 1 PLANT.

Production capacity of 45000 MT of roofing materials and 10000 MT of cement boards every month. It has 20 Depots across India.

SIL has its presence across the globe, mainly in ASIA,Africa and America.

SIL has various products like roof cement sheets, Cement Doors, Designer doors and windows, Plain doors, Cement Boards, construction and building materials and Green toilets as a part of Swatch Bharath Program of NDA government. SIL also has its presence in Windmills.

It has a market cap less than 100Crs(68Crs@cmp 71 ), Promoter stake 66.3%, debt ~140Crs and its only competitor is Hyderabad Industries Ltd. Considering its presence in unique domain and fast changing rural and urban infrastructures across India, I feel it has great potential to multiply its sales as well as share price from here on-wards. 

Buy Sanghi Industries - CMP:57 Target: 100+ for next 2 years.

Sanghi Industries Limited (SIL) is the flagship company of The Ravi Sanghi Group dealing in the production and distribution of Cement under the Brand Name "Sanghi Cement".

Sanghi Cement, is produced at one of the world's largest single stream Cement Plant located at Sanghipuram in the Abdasa Taluka of Kutch District of Gujarat State. This plant is fully automatic with state-of-the-art technology from Fuller International, USA and having capacity of 3.0 MTPA. The company produces superior quality 53 Grade OPC and PPC Cement and have revolutionized the way cement is produced and sold in India.

Company is sitting on 1 billion tonne of limestone and had been repaying debt diligently over the trailing three or four years. Sanghi started commissioning a 1 million tonne grinding capacity and looks good to multiply capacity from 3 million odd to maybe about 7-10 million over the next five years.

It has promoter holding of 71% and recently Reliance and Birla Sun mutual funds have invested heavily.

Considering the infra spending central government started and fast urbanization happening around India, there will be a huge consumption of Cement in India for sure. So company is in right direction to create massive wealth for investors.

Buy NCC- CMP:102 Target: 200+ for next 3 years.

Buy Prism Cement - CMP:102 Target: 200+ for next 3 years.

More details will follow soon for these recommendations.

Buy DCB Bank: CMP:115 Target: 200+ for next two years.

DCB is one of the best upcoming private bank with strong balance sheet and lot of scope for growth going forward.

From April 2013, bank has increased it's branches from 94 to 154 across 17 states and 2 union territory and number of employees increased from 2220 to 3352.Now they are moving towards states like Chhattisgarh, Madhya Pradesh on the southern side Telangana and now on the eastern side Odisha. 

Bank reported very good quarterly result for March 31st 2015, with profit increased QOQ to 61%.

Considering turnaround in Indian economy,banks low NPA levels and execution ability, we can expect health growth year on year for next few years.

This week I am introducing two interesting small caps, which might create huge wealth if everything goes as per plan.

Marksans Pharma: CMP:67.5 TP: 200+ for next 5 years.

Marksans Pharma (MRKS), post successfully tackling operational and financial issues, has emerged much stronger and focused, and is now well poised to ride the growth superhighway over coming years. While the softgel capsules opportunity will be growth lynchpin, most of the company’s other businesses too will propel surge. Management expects more approvals, market share gains in launched products and better mix to boost revenue and profitability. It has guided for 30% plus revenue CAGR and 300-400bps margin surge over FY14-17.

Marksans is Out of the woods,Clocking robust growth. It had a host of issues (negative net worth, high debt, low profitability, etc.) had cropped up simultaneously in FY10-12, taking a toll on MRKS’ financial health. However, management’s focused and tenacious approach helped the company sail through turbulent times relatively unscathed. As investments have ripened and the ecosystem for businesses has improved, MRKS has clocked impressive growth/ return metrics over the past 2 years. It delivered 27% / 31% revenue/EBITDA CAGR over FY11-FY14, net worth has turned positive and debt has plummeted significantly.

Its well placed to cash in on niche softgel opportunity.Softgel capsules is an uncrowded segment with healthy margins, and MRKS is one of the potent emerging global players in this market. While US is the key driver, the company’s current softgel business will ramp up further as approvals start flowing in across the globe. The US softgel market is estimated at USD8bn+, of which MRKS is eyeing 90% (including RX & OTC segments). With single product approval (Ibuprofen softgel), the company generates USD12mn revenue in the US. Additionally, it has a healthy pipeline (10 ANDAs awaiting approval) and more ANDA approvals are bound to spur growth.

Marksans has almost zero debt, whatever debt company has planned to clear soon. As per analysis, sales of Marksans pharma likely to increase three to four times in next 2-3 years.

T&D Power systems: CMP :430 TP: 1000+ in next 3-4 years.

TDPS is small emerging company which has global presence in the turbine business and power generators .TDPS cash rich and zero debt with 98% of the shares with promoters, Institutional investor and FIIs. Only 2% is with retail.

It also TDPS is all set to reap the benefits of its focus on international business and the expanded capacities in the next few years. With its tie-ups with OEMs like GE and Voith Hydro, I expect a substantial ramp up in revenues (17% CAGR) and profitability (60% CAGR) over FY14-17E. I expect the improvement in profits to translate into higher dividend payouts given TDPS' low capex requirements and zero net debt.

In compared to other companies of same segment, TDPS’s balance sheet and capex plan is in much better shape.

Here is the details of Edelweiss and Engineers of India.

Edelweiss Financial Services:

Edelweiss is one of the diversified financial services company which deals with businesses like Corporate Credit, Retail Credit, Housing finance,Insurance,Fixed income,  commodity dealing and also deals with  financial markets and asset management.

In last two years company’s profit doubled year-on-year in a very bad or bearish Indian economy. Since company deals with all high profit margin business and Indian economy is showing all signs of improvement, Edelweiss will be the dark horse in NBFC sector. If you consider the balance sheet of the company, its cash reserve is 1145 Crs and net debt 849 Crs, so net net its +ve cash reserve company with tremendous scope to go up from here.

Engineers India Limited:

EIL provides engineering consultancy and EPC services principally focused on the oil & gas and petrochemical industries. The Company has also diversified into sectors like infrastructure, water and waste management, solar & nuclear power and fertilizers to leverage its strong technical competencies and track record.

Today, EIL is a ‘Total Solution’ engineering consultancy company providing design, engineering, procurement, construction and integrated project management services from ‘Concept to Commissioning’ with highest quality and safety standards. It also provides specialist services such as heat and mass transfer equipment design, environmental engineering, specialist materials and maintenance and plant operations and safety services.

Since economy is all set to uptick and the way mega infra projects central government is planning to start, EIL will be the major beneficiary. Regarding financial health of the company promoter stake is 70%, FII & DIIs has 21%, Net cash reserve is 2300 Crs(~69/Share Cash reserve) and debt is zero.

Buy
Edelweiss ( CMP:53 TP:100+  Duration:2-3 years )
Engineers India ( CMP:226 TP:300+ Duration:1-2 Years )

Will provide the details as soon as possible.

Following two mining stocks, fundamentally very strong, undervalued, have huge cash reserves, zero debt and missed the just started great bull run driven by nationalist government at the center. Over a period of time these companies also diversified themselves into various businesses apart from just mining iron ore or manganese.

NMDC (CMP:143  TP: 250 Duration: 2-3 Years)

GMDC (CMP:123  TP: 230 Duration: 2-3 Years)

	NMDC	GMDC
Promoter Stake (%)	80	74
FII Stake (%)	6.77	6.11
DII Stake (%)	10.61	12.40
Retail (%)	2.62	7.4
Debt (INR)	0	0
Life Time High	571.80	317
Cash Reserve (Cr)	30,000	28,00
Equity (Cr)	396.47	31.8
Cash Reserve/Share (INR)	76	88

Reason for the under-performance was due to the major correction happened to the minerals/commodities across the globe. Most of the commodities already corrected to 2008/2009 levels, chances of further major correction seems to be very low. Since world seen very low GDP in last 6 years, things will only improve from here on-wards and consumption theme will pick for sure. It might take some time, but trend from India point of view seems to be becoming ultra strong due to strong consumption base and business friendly government at the center.

Soon, I will be publishing fundamental stocks.

Regards
Vinod Kagalkar