Market Mantra

Indian bourses are trading in the Green today, taking cues from the global markets. Also, on last Friday FIIs were net buyers of equities worth Rs.369.08 crores. This gave a great sentimental boost to the bulls. Photo: The Economic Times.

Meanwhile, in China protests are being held to lift lockdown. In India, the chances of fresh lockdown due to Covid-19, is almost nil. Hence, I'm expecting a broad based rally in the domestic stock markets.

Now, while the domestic indices are likely to consolidate at the current levels, the action will be seen in the broader market. In view of this, I have today recommended some momentum counters, as mentioned below:

💥Buy Websol Energy Systems Ltd (Rs.94.65) near the CMP for short term target of Rs.117.

Websol Energy System is a Kolkata-based manufacturer of solar cells and modules. Last year the company commissioned its dormant 250 MW module manufacturing line. The company is restructuring its existing 250 MW solar cell capacity towards higher cell sizes and looking to commission additional solar cell capacity.

💥Buy Visa Steel Ltd (Rs.16.20) for short term target of Rs.21.

💥AU Small Finance Ltd (Rs.642) has broken a major resistance on the upside. Next target: Rs.717.

💥Unless Coffee Day Enterprises Ltd (Rs.51.40) gives a closing above Rs.52, kindly don't take fresh position.

💥Those who are having cash in your account kindly try to average the shares of RTN Power Ltd (Rs.4.25) to bring down your acquisition Price.

💥Buy Vakranjee Ltd at Rs.30.55, T: Rs.37/39, SL:  Rs.27.

💥Buy Aban Offshore Ltd at Rs.49, T: Rs.72, SL: Rs.47. When the crude is trading near $100 per barrel, it is obvious that the stocks of oil exploration companies will do well in the present situation.

💥 Continue to accumulate the shares of late Rakesh Jhunjhunwala favourite, D B Realty Ltd (Rs.98.25), as it is likely to be taken over by a big business house, as per market speculation.

The company came out with excellent set of numbers for the September, 2022 quarter.

The net profit of D B Realty came at a whopping Rs.568.67 crore in the quarter ended September 2022 as against net loss of Rs.352.50 crore during the previous quarter ended September 2021. Sales rose 15.45% to Rs.10.16 crore in the quarter ended September 2022 as against Rs 8.80 crore during the previous quarter ended September 2021.

💥Those who are holding the shares of Dilip Buildcon Ltd (Rs.233.85) can continue to do the same, adding on market declines.

💥The stock of Nahar Spinning Mills Ltd (Rs.284.50) is doing well today. With the cotton prices falling across-the-board, and the government of India coming up with 2nd PLI scheme, the textile stocks should be doing well in future 

Market  Mantra

The Indian bourses are trading flat in absence of any major news or event. However, the softening of stance of the US Fed, has again brought the bulls into the ring. 

The BSE Sensex was trading at 62,225.03 up 30.76 points (-0.08%), while the Nifty was seen trading at 18,476.70 up 1.50 points (+0.01%). The Sensex and Nifty are expected to trade range bound while the action is likely to be seen in the small and mid cap counters. Buy good small and mid cap stocks and keep holding.

#Today the shares of Coffee Day Enterprises Ltd (Rs.52.75) made an intraday high of Rs.54. The short term traders are suggested to book some profits and hold the rest with a SL of Rs.51.70.

#Buy the shares of D B Realty Ltd near the CMP of Rs.97/98, for short term targets of Rs.127/131. SL:  Rs.94.

Earlier there were media reports that its wholly-owned subsidiary, Esteem Properties, had entered into a non-binding term sheet on September 16 for the sale of its land, adjoining to ITC Grand Maratha Hotel, Andheri East, Mumbai at a consideration of Rs 480 crore.

In a significant development, Adani Realty, the luxury residential and commercial property arm of the leading multinational conglomerate Adani Group, is in advanced talks for a merger with Mumbai-based DB Realty, according to a report by business daily The Hindu BusinessLine.

The merger could be one of India’s largest real-estate deals and is likely to pave way for Adani Realty's listing on the bourses. DB Realty is a listed company and after the merger it would be renamed as Adani Realty, as per the report.

Moreover, true or false -- the name of Sharad Pawar, has always been associated with this company.

#Yesterday, a buy call was initiated in the shares of A U Small Finance Bank Ltd (Rs.232) around Rs.634, for short term target of Rs.717. The stock is trading flat today, after making an intraday high of Rs.637.90. Buy and keep holding. The stock will cross Rs.1000, over a period of time 

The biggest boost to the bottom line has come from a massive improvement in the asset quality with gross steeply falling to 1.96% year-on-year from 4.31% and the net NPA plunging to 0.56% of net advances from 2.26 % in the pandemic hit June 2021, its managing director & chief executive Sanjay Agarwal said.

#Accumulate the shares of Aban Offshore Ltd (Rs.48.75), e for targets of Rs.71/85 especially when the crude oil is trading near $100 per barrel.

#Accumulate the shares of Indowind Energy Ltd (Rs.13.95) in all market declines. Its Q2FY23 results were excellent. This is a sure shot recommendation. 

 Market Mantra

The Indian markets are down following global cues: US Fed's Hawkish stance on interest rate, Russia Ukraine War and fresh cases of coronavirus in China. 

The BSE Sensex is now trading at 61,095.16 down 568.32 points (-0.92%) while the Nifty was last seen at 18,141.85 down 165.80 points (-0.91%). The main indices comprising of mostly large caps, may correct 16,000 as mentioned by Sushil Kedia, the other day, but that has nothing much to eo with the movement of small and mid cap counters, albeit some rub off effect though.

The traders should understand that small and mid cap is one basket, while large cap is another basket. Therefore, though linking the two is erroneous but it often happens in the real life. Photo: Angel One.

The small and mid cap rally is about to begin and hence you need to keep your guns ready for the final shooting.

Buy the shares of the companies obtained from distress selling from the traders tormented by margin pressures from brokerage houses. You need to buy and keep holding. Is the work too difficult?

#Today my recommended Swan Energy Ltd made a high of Rs.261. Its 2nd targets has also been achieved.

#Today the shares of Dilip Buildcon Ltd (Rs.122) made an intraday high of Rs.230.70. The company came out with good quarterly numbers. Going forward the margins are likely to improve due to lesser number of Legacy orders. Accumulate.

#Coffee Day Enterprises Ltd (Rs.47.85) will make windfall gains on the coffee beans sold, as the price was fixed when the coffee prices were touching new highs, in the international markets. Accumulate!!

#Most of my recommended counters came up with good September, 2022 quarter results, but surprisingly Zee Business only finds Banks (UCO Bank and Central Bank -- both doing well) in the list. As a result the money is flowing into banking counters only, instead of uniformly traveling into various outperforming sectors.

This market looks to be fully manipulated -- operators move a stock and TV Channels recommend them (because they look good on chart...😂😂) to the gullible investors. This either elevates a stock or makes it fall. Very sly operator game is going on in the Indian bourses.

 Coffee Day Enterprises Ltd: Result Update

Coffee Day Enterprises Ltd (Rs.48.80) came out with excellent set of numbers for the September, 2022 quarter.

The net profit of the company came as Rs 5.67 crore in the quarter ended September 2022 as against net loss of Rs.84.85 crore during the previous quarter ended September 2021. 

The Sales rose 56.15% to Rs.229.16 crore in the quarter ended September 2022 as against Rs.146.76 crore during the previous quarter ended September 2021. The quarterly results are set to improve further as the Nationwide Lockdown were lifted across India. Photo: AndhraFriends.com.

Initial Public Offering: Coffee Day Enterprises Ltd came up with an IPO at a price band of Rs.316 to Rs.328 per share in October, 2015.

The CMP of the shares of the company is at a considerable discount to the IPO price. 

Business: Coffee Day' (CCD). Company owns a network of 550 - plus Cafe outlets spread across in India.

In addition to having one of the largest chain of cafes in India, company operate a highly optimized and vertically integrated coffee business which ranges from procuring, processing and roasting of coffee beans to retailing of coffee products across various formats. 

The Company is one of the largest exporters of Indian coffee beans, primarily to Europe, Japan and the Middle East.

According to Wikipedia: Café Coffee Day Global Limited Company is a Chikkamagaluru-based business which grows coffee in its own estates of 20,000 acres. This should be valued around Rs.2000 crores.

It is the largest producer of arabica beans in Asia, exporting to various countries including U.S., Europe, and Japan.

Now calculate the value of this property against the CMP of the shares of the company.

Tata Coffee currently has about 8,000 hectares of coffee plantation, most of it located in Toopran (Telangana) and Theni (Tamil Nadu).

Debt Reduction: The debt levels have reduced significantly from Rs.7,214 crore as on March 31, 2019 to Rs.1,898 crore as at the end of March 31, 2021 and to Rs.1,810 crore as at the end on March 31, 2022.

Meanwhile, Tata Consumer Products had withdrawn a proposal to purchase the vending machine business from Coffee Day Enterprises, about two years after the firm had started talks and begun evaluating a potential acquisition.

According to the market grapevine, the deal got cancelled because the management of Coffee Day Enterprises Ltd was demanding higher price than the previous one. 

Tata Consumer Products Ltd, which owns the Tetley Tea and Tata Salt brands, had earlier proposed to buy the coffee vending business from CGDL for at least Rs.1,000 crore.

This happened because of the turnaround of the company during the last one year.

Accumulate the shares of Coffee Day Enterprises Ltd (CCDL) near the CMP of Rs.48.80 for short term targets of Rs.57/61/72/85.

 Tata Teleservices Ltd: Result Update

In September, 2022 quarter on Q - o - Q basis:

Revenue: ₹2.79b (up 2.8% from 2Q 2022).

Net loss: ₹2.93b (loss narrowed by 6.7% from 2Q 2022).

₹1.50 loss per share (improved from ₹1.60 loss in 2Q 2022).

Financial Results (Half Year Ended FY2023) - Y - o - Y Comparison:

The company has reported total income of Rs.548.12 crores during the 6 Months period ended September 30, 2022 as compared to Rs.541.51 crores during the 6 Months period ended September 30, 2021.

The company has posted net profit / (loss) of Rs.-587.86 crores for the 6 Months period ended September 30, 2022 as against net profit / (loss) of Rs.-632.08 crores for the 6 Months period ended September 30, 2021.

Advantages: Continuous liquidity support from parents, a focus on the SME segment, media reports of potential collaboration with other Tata Group companies, and transformation into a SaaS+connectivity solution provider are just a few of the positives that could be working in Tata Teleservices Ltd's favour. 

Given the rising digital adoption trend, the market opportunity in the SME space is vast. In addition, the company stated in its annual report that it is looking into restructuring options.

Tata Teleservices has seen its revenues rise owing to the adoption of cloud-based solutions by companies. It is now exploring growth in the 5G domain, the report said.

As the world moves towards a digital industry, the company provides solutions that are essential in improving efficiency. For example, it helps companies move to the cloud and secure their networks. It also offers voice solutions to companies of all sizes. 

Besides, there's a speculation in the market that the company could turn out to be a winner replicating the success and business model of Tata Elxsi or Tata Communication, other multibaggers from Tata Group stable.

Moreover, giving a stake to the government by converting debt is always a better option for both the government and the companies.

Accumulate, the shares of Tata Teleservices Ltd (Rs.97.60) for long term perspective, with target prices of Rs.141 - Rs.191. 

Company Profile: A Tata Group company, Tata Teleservices (Maharashtra) Limited (TTML) is a leading player in the connectivity and communication solutions market serving enterprise customers. It offers services ranging from connectivity, collaboration, cloud, security, IoT to marketing solutions as comprehensive portfolio of ICT services for businesses in India under the brand name Tata Tele Business Services (TTBS). 

TTBS provides integrated telecom solutions to enterprises that go beyond the purview of connectivity into offering one-stop-shop business solutions and managed services.  

Market Mantra

The Indian bourses as expected are on consolidated phase. The BSE Sensex is now trading at 61,750.47 down 41.55 points (-0.07%), while the Nifty was last  seen at 18,360.85 up 11.15 points (+0.06%). While the indices are likely to trade in a range, the action will be focused on small and micro cap counters due to the commencement of the #November #Effect.

#Buy BIOCON LTD at Rs.283, Short Term 🎯: Rs.294/Rs.297,  SL: 277.90. fundamentals of the company are looking decent. 

#Keep accumulating the shares of Nitin Spinners Ltd (Rs.196) and Nahar Spinning Mills Ltd (Rs.179). The new bales of cotton are set to arrive post 15 November, 2022. The cotton prices are falling across-the-board. 

#Today the the shares of the blue chip construction company, Dilip Buildcon Ltd (Rs.335) are doing fine. The company is all set to turn around from this (Q3FY23) quarter. I'm looking for a price above Rs.500, in the next 6 - 9 months time frame.

#Buy BPL Ltd near the CMP of Rs.67.40, T: Rs.71/76, SL: Rs.65. 

The ongoing festival season is likely to lift the fundamentals of this consumer dirable company.

Indowind Energy: Buy

CMP: Rs.15.35

Book Value: Rs.25.75

Introduction: Indowind Energy Ltd develops and sells wind farms, manages wind assets, and generates Green Power for utilities and corporations. 

Its work consists of Wind Power Project Implementation from Concept to Commissioning, Wind Asset Management Software for installed assets, including operations, billing, and revenue collection from project customers. Customers are supplied with Green Power CER (Carbon Credit) Trading and Sales.

Financials: The consolidated net profit of Indowind Energy, surged 656.86% to Rs.3.86 crore on 64.60% increase in net sales to Rs.14.60 crore in Q2 September 2022 over Q2 September 2021.

On a consolidated basis, profit before tax surged 587.7% year-on-year to Rs 3.92 crore in Q2 September 2022. Total expense climbed 32.4% YoY to Rs 10.35 crore in Q2 FY23.

The net profit surged 138.27% and net sales soared 88.63% in Q2 FY23 over Q1 FY23.

The company's net cash from operating activities stood at Rs 9.22 crore in the half year ended September 2022, higher than Rs 2.41 crore in the same period last year.

EBITDA stood at Rs. 8.35 crore in September 2022 up 56.95% from Rs. 5.32 crore in September 2021.

Indowind Energy Ltd's EPS has increased to Rs.0.42 in September 2022 from Rs.0.05 in September 2021.

Conclusion:  Buy the share of Indowind Energy Ltd for short term targets of Rs.31/32.

 Winning Strokes

The Indian bourses were on roll last Friday, after an Economic Times report indicated that the NDA government is examining possible changes to the capital gains tax regime to make it simpler, including rationalisation of the multiple holding periods.

The BSE Sensex closed at 61,795.04 up a massive 1,181.34 points (+1.95%) while the Nifty50 ended the day at 18,349.70 up by a whopping 321.50 points (+1.78%). 

In a significant positive development, foreign investors (FIIs/FPIs) have invested nearly Rs.19,000 crore in Indian equities so far this month, owing primarily to a slowing trend in US inflation and a weakening dollar.

On Monday, the markets are likely to consolidate around the current ranges. The future direction of the market will come from global cues and also from the current earning session.

However, since November Effect has kicked in, the investors should do well to buy momentum counters from the small, mid and micro cap space. I am bullish on Oil & Gas, Construction, Textile, Renewable Energy and Restaurant sectors.

#Coffee Day Enterprises Ltd (Rs.52.75) came up with good September quarter results. 

Net profit of Coffee Day Enterprises Ltd came at Rs.5.67 crore in the quarter ended September 2022 as against net loss of Rs.84.85 crore during 66 move towards my targets of Rs.84/91. The restaurant sector has been doing well since lifting of Nation Wide Lockdown. Accumulate in dips.

#Aban Offshore Ltd (Rs.49.60), India's largest oil exploration company in the Private Sector, came up with good September quarter numbers. 

Quarterly Net Loss of Aban Offshore Ltd came at Rs. 207.53 crore in September 2022 down 16.34% from Rs. 248.07 crore in September 2021.

This means the cost overrun or margin shrinkage through legacy orders has substantially come down in Q3FY23.

However, Net Sales were at Rs.94.88 crore in September 2022 down 32.37% from Rs.140.28 crore in September 2021.

The buoyancy in the crude oil prices and lowering of the number of low value legacy orders will take the scrip to Rs.71/72. Remain Invested.

#I have recommended the share of the Tata Group Company, Tata Teleservices Ltd (Rs.100.30) on last Friday at around the CMP for long term targets of above Rs.250.

According to a Business Standard report, the Tata Group Company, Tata Teleservices Ltd (Rs.100.30), is restructuring its telecom business, which is spread across various companies, by making additional investments in Tata Teleservices and exploring opportunities in 5G-based segments by providing back-end services.

It is pertinent to mention here thar in June, 2022, the NDA government at the centre allowed enterprises to set up captive non - public networks to buy 5G spectrum directly from the DoT, in order to establish their isolated networks.

Meanwhile, while Tata Teleservices continues to focus on enterprise businesses, the group has brought in Tata Communications to provide 5G-based services such as automated equipment quality inspection, inventory management, and asset tracking. Although the group sees 5G as a significant opportunity, it has refrained from purchasing the more expensive 5G spectrum. However, to stay in the game, it will most likely focus, on value-added services.

#Dilip Buildcon Ltd's (Rs.224.45) debt is nothing as compared to Tata Steel. At the end of the June quarter Tata Steel had a gross debt of ₹82,597 crore and net debt of ₹54,504 crore. As of March, 2022, the total debt of Dilip Buildcon (Rs.224) was Rs.8,783 Cr. While Reserves & Surplus was at Rs.4189.92 Cr.

The company has an order book of Rs.25,000 - plus crores. It is a blue chip company from the construction space and is rumoured to have some connections (invisible hand) with the current Madhya Pradesh government.

The HDFC Securities has already provided a target of Rs.369 for the scrip. However, I feel it will slowly move towards Rs.500 - plus, as the cost overruns or margin shrinkage from legacy projects comes down from this quarter. Accumulate!!

#Accumulate the shares of Orient Green Power Company Ltd (Rs.8.60) and RTN Power Ltd (Rs.4.20) because of the commencement of November Effect.