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Safe to invest in real estate directly and indirectly? Lodha Group- giant leap in Net sales

by 5paisa Research Team 26/10/2021

Macrotech Developers, more commonly known as Lodha Group was founded in 1980 and their headquarter is in Mumbai.

Ever since the IPO was issued, the company has entered into 5 Joint Development Agreements worth Rs.46 billion. The company has also reached a decision to raise Rs.40 billion worth of capital for growth and this can in-turn add Rs.400 billion worth of projects and it will also bring down the net debt to under Rs.100 billion.

The residential sales which fell strongly owing to the pandemic, increased sharply in Q2 FY22 as the prices had significantly decreased which attracted more and more customers even though the second quarter of the year is generally very slow due to the monsoon season and also the Shraadh season (when people usually don’t buy houses). The decrease in home loan interest by banks was the icing on the cake.

Despite the high disruption caused by the pandemic Macrotech Developers reported a high operational performance with an increased amount of booking. The Net sales increased from Rs.16054 million in Q1 FY22 to Rs.21238 million in Q2 FY22 which is a 32.3% increase QoQ and a 135.8% increase YoY. The adjusted PAT increased 37% QoQ. In the financial year 2022 the net debt remained stable at Rs.12,508 crore.

The company’s projects in UK saw a sharp upturn in sales booking in the second quarter given the easing of restrictions. If this upturn continues then the company can capitalize on the UK project and this will help further the aim of deleveraging by the end of FY22.

The company plans on adding Rs.100-Rs.70 billion worth of projects by FY22 and most of the development will be focused in Pune, Eastern suburbs of Mumbai and Navi Mumbai, before they move on to newer markets. Also the company reported their agenda to launch Rs.60 billion worth of projects in this financial year.

The prices of all the projects are being increased by 2-4% owing to the increase in raw material (+10% YoY) and input costs which are being passed on to the customers. The demand still looks strong and the pent up inventory is decreasing at an increased level which gives us a positive future outlook.

The company is also in talks with different agencies in order to invest in and create a platform for Digital infrastructure.

The company is on a firm track to realizing its aim of deleveraging by end of FY22 in presence of the high amounts of JDA. Lodha being a well trusted and very reputed company has attracted more and more land owners and small builders thus leading to a lot of JDA opportunities.

Macrotech has set a goal of achieving Rs.9000 crore worth of sales bookings, 50% more than what it achieved in FY21.

Keeping in mind all the positive aspects, a BUY call has been reported by the analysts, along with a price target of Rs.1262.

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Multibagger Alert: This leading wires and cables manufacturer has given investors 164% in the past year!

Multibagger Alert: This leading wires and cables manufacturer has given investors 164% in the past year!
by 5paisa Research Team 26/10/2021

On a YTD basis, the stock has given a return of 123%.

The stock of India’s largest manufacturer and seller of cables and wires, Polycab India has given investors stellar returns of 164.72% over the last year. The share price stood at Rs 883.45 on October 23, 2020, and since then, the stock has more than doubled investor wealth.    

Wire and cables manufacturer Polycab India’s revenues jumped strongly in the second quarter as the economic recovery from the coronavirus bolstered demand across all markets and product categories. The company’s top-line grew by 48.03% to Rs 3128.83 crore from Rs 2113.68 crore in Q2FY21. Total expenditures in comparison grew by 56.89% to Rs 2825.98 crore during the same period because of the higher raw material expenses. Due to higher increase expenditure in comparison with revenue, the operating profit of the company declined by 4.63% YoY to Rs 329.24 crore during the quarter. PAT stood at Rs 200.84 crore, down 9.46% YoY.

Given its scale and size, Polycab India is building on market share gains through the expansion of its distribution network and by increasing ad spending. The company’s retail share of revenue has increased from 30% to 40% led by strong growth in the Fast-moving electrical goods (FMEG) business, which it started in FY14. Meanwhile, the increasing pace of project execution in infrastructure and construction on a sequential basis is supporting revenue on the institutional side. In the export market, the company has a healthy order pipeline from the US, Australia and other markets.

Wires and cables play a vital role in every aspect of infrastructural growth and have extensive usage across many industries. The growing demand for power, light and communication has kept demand high for cables and wires which constitute 40% of India’s electrical industry. Currently, around USD 38-40 billion of cables are imported from various countries. Favourable government initiatives and reforms to promote indigenous manufacturing, foreign investments, renewable energy and pan-India digital connectivity ensure that the prospects of the wires and cables industry and thereby Polycab India remain bright.

Polycab is India’s largest manufacturer and seller of an extensive range of cables and wires, and a fast-growing player in the fast-moving electrical goods (FMEG) industry, along with an established export presence.

At 12.10 pm on Tuesday, the stock is trading at Rs 2314.35, down by 1.04% or Rs 24.30 per share as against a 0.03% gain in the benchmark index. The 52-week high of the scrip is recorded at Rs 2,647.40 and the 52-week low at Rs 900 on the BSE.

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Container corporation of India- Potential 18% upside with a strong growth of 21% in FY22

by 5paisa Research Team 26/10/2021

Container corporation of India was founded in 1988 and is owned by the Indian Railways, Government of India. The company is a part of the logistics sector. The logistics sector of the country is valued at $160 billion as of 2019 and contributes a whopping 14.4% of the GDP.

In the Second quarter of FY22 the revenue, standing at Rs.18.2 billion, saw an upwards growth of 21% YoY mainly due to a domestic growth of 43% YoY and export import growth of 14% YoY. There was a substantial increase in domestic handling volume which increased by 34% YoY. In Q2 FY22, the domestic handling volume grew by 7% whereas the Exim (export import) volume declined by 3%. According to the management, the shortage of containers has stunted the growth of the company which would have otherwise been 10% higher than what it is right now. The PAT increased by 41% YoY to Rs.2.64 billion and there was a 3.6% increase QoQ. The EBITDA Margin fell by 60bps which can be attributed to the fact that the operational efficiency was disrupted due to the container shortage fiasco. The total expenses of the company rose from Rs.11897 million in Q2 FY21 to Rs.13975 million in this quarter, displaying an increase of 17.5% YoY. EBITDA jumped up by 46% YoY to Rs.426 crores due to the increase in operating margins. For the second quarter, the board has decided to pay an interim dividend of Rs.4.

Concor started offering a 50% discount on rail freight for the relocation of empty containers from different ports to hinterland terminals. From September a higher rebate of 75% is to be give to shipping lines if they offer 10k containers per month and a 100% discount if 15k containers are offered.

From October 2021, a pan-India hike of Rs.1000/teu for container handling in terminals is to be initiated. According to managements, the domestic segment will be the higher growth driver in the near future and thus has plans to change the Exim: domestic ratio from 70:30 to 60:40.

Analysts have recommended a BUY call for this share, with a target price of Rs.800. A potential upside of 18% can be estimated from this share.

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These penny stocks are locked in the upper circuit on Tuesday

These penny stocks are locked in the upper circuit on Tuesday
by 5paisa Research Team 26/10/2021

On Tuesday, the benchmark indices were trading mixed amid volatility with Sensex trading 97.29 points higher at 61,064.34 level and Nifty 50.45 points up at 18,175.85 level.

Tech Mahindra, Titan, SBI, Ultra Tech Cement and Tata Steel are the top 5 gainers in the Sensex group whereas IndusInd Bank, Axis Bank, HUL, ICICI Bank and Powergrid Corporation were among the top 5 losers within the index. The stocks of SBI and Tech Mahindra have made fresh 52-week highs in Tuesday’s trading session.

In the broader markets, the BSE Midcap and BSE Smallcap indices are seen outperforming benchmark indices gaining 1.05% and 1.60%, respectively. Macrotech Developers (LODHA) is holding the top position in the BSE Midcap index whereas, in the smallcap space, KEI industries has caught the spotlight jumping 13.34% on an intraday basis.

On the sectoral front, apart from BSE Bankex, all the sectoral indices are seen trading in green. BSE Realty index is shining and has managed to trade 2.9% higher in the Tuesday trading session, amid volatility. The top-performing stock lifting the index is Brigade Enterprises, zooming up to 6.21% followed by Oberoi Realty, Mahindra Lifespace Developers and Prestige Estates.

The BSE Bankex Index is the weakest performing sector in Tuesday’s trading session, declining 0.21%. IndusInd Bank, ICICI Bank, Axis Bank, Bandhan Bank and Kotak Mahindra Bank were the stocks facing the highest pressure within the BSE Bankex index.

In a volatile day, several penny stocks were seen outperforming the markets gaining up to 4.82%.

Following penny stocks locked in the upper circuit on October 26, Tuesday -

Sr No   

Stock   

LTP   

Price Gain (%)   

1  

Lloyds Steels  

6.1  

4.27  

2  

Shriram EPC   

6.75  

4.65  

3  

Viji Finance   

2.7  

3.85  

4  

Ankit Metal Power   

3.9  

4  

5  

SITI Networks   

1.9  

2.7  

6  

Indosolar Industries   

3.65  

4.29  

7  

Zenith Birla   

1.15  

4.55  

8  

Eastern Silk   

4.35  

4.82  

9  

DCM Financial  

3.9  

4  

10  

W S Industries   

9  

4.65  

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These low-price shares are locked in the upper circuit on Tuesday, October 26

These low-price shares are locked in the upper circuit on Tuesday, October 26.
by 5paisa Research Team 26/10/2021

Some of the low-price shares are seen outperforming the markets in today's trading session.

The markets are seen recovering with the BSE Sensex trading in green, up by more than 70 points on Tuesday.

Titan is the top BSE Sensex gainer up by more than 2% on Tuesday while IndusInd Bank is the top BSE Sensex loser on Tuesday.

SBI, Tech Mahindra, Ultra Tech Cements, Nestle India, HDFC, Bajaj Finance and Tata Steel are some of the top BSE Sensex gainers. The broader market is seen outperforming the frontline indices in the Tuesday trading session with both BSE Midcap and BSE Smallcap index up by more than 1% each.

KEI Industries, Medicamen Biotech, TCI express, HG Infra, GPIL and Jagran are some of the top BSE Smallcap index gainers on Tuesday.

IDFC First Bank, Tata Power, Sona BLW Precisions and Lodha are some of the top-performing BSE Midcap index constituents. Torrent pharma is the worst performing BSE Midcap stock.

BSE Realty index and BSE Consumer Durable index are seen outperforming the markets on October 26. BSE Auto index is up by more than 1% on Tuesday aided by Tata Motors stellar gains on the bourses.

The price-volume breakout is seen in some of the low-priced stocks today with several stocks being locked in the upper circuit.

Following is the list of low-priced stocks that are locked in the upper circuit in Tuesday trading session:

Sr No   

Stock   

LTP   

Price Gain (%)  

1  

3i Infotech   

34.15  

4.92  

2  

Andhra Cements   

17.85  

5  

3  

Tata Tele   

52.95  

4.96  

4  

Tilaknagar Industries   

59.6  

4.93  

5  

Brightcom Group   

69.4  

4.99  

6  

Digi Content   

12.25  

4.7  

7  

Jain Irrigation  

43.8  

4.91  

8  

Digijam L   

22.95  

4.79  

9  

Rohit Ferro-Tech   

15.5  

4.73  

10  

Patel Integrated Logistics   

25.3  

10  

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Mukul Agarwal - The new star of the Indian Stock Market!

Mukul Agarwal - The new star of the Indian Stock Market!
by 5paisa Research Team 26/10/2021

As per the latest corporate shareholdings filed, Mukul Agrawal publicly holds 47 stocks with a net worth of over Rs 2,317.8 crore.

Mukul Agarwal, the new star of the Indian stock market, debuted in the late 1990s. His recent stakes largely in the small segment, bear testimony to his investment style which is largely aggressive, hawking for multibaggers that are capable of astronomical returns. On October 25, Paras Defence touched its all-time high of Rs 1272.05, swelling Mukul Agarwal’s stake in the company to Rs 115 crore.

As per the latest shareholding data, during the September quarter, the star investor bought a fresh stake in at least 15 companies.

Top holdings of Mukul Agarwal

1. The top holding in the portfolio of Mukul Agarwal portfolio is Radico Khaitan Ltd. He has a stake of 1.05% for 14,00,083 shares in this midcap IMFL (Indian Made Foreign Liquor company). During the week of October 17 to October 23, the stock has moved 2.6% from the levels of Rs 1095.05 to Rs 1123.05. The stock is the top holding of the ace investor after its addition to the portfolio in the September quarter.

2. He also made a fresh entry into PDS Multinational Fashions by buying 7,16,000 equity shares or a 2.75% stake in the company. His stake is worth Rs 99 crore. PDS Multinational is one of the largest consumer goods design, product development, sourcing, virtual manufacturing and distribution businesses.

3. Mukul Agarwal has a stake of 2.32% for 904,286 shares in this Debutant Stock- Paras Defence and Space Technology. The buzzing stock surged nearly 132% from its listing price of Rs 475 and 529% from the IPO price of Rs 175. During the week of October 17 to October 23, the stock has soared up by a phenomenal 91.3% from the levels of Rs 633.25 to Rs 1211.50. The stock is one of the top three holdings of the ace investor.

Apart from these top holdings, Mukul Agarwal acquired a fresh 1.3% stake in Allcargo Logistics in the Midcap segment. In Smallcap segment, he has added MTAR Technologies for a 1.3% stake, Goldiam International for a 2.8% stake, MPS Ltd for a 4.4% stake and Zota Healthcare for a 4.9% stake to name a few of recent additions to his portfolio.

Current outlook of Mukul Agarwal

Mukul Agarwal is currently of the view that the markets have entered the last phase of the Dow Theory. Dow theory asserts there are three phases of the market trends – an accumulation phase, a public absorption phase, and a distribution phase.

The recent correction in the markets where the FIIs, DIIs and HNIs were the net sellers and the retail investors were the purchasers. This supports his belief that a retail investor needs to be cautious in the current market where valuations are very high.

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