Query Board
BIOCON LTD I have 100 shares of Biocon bought at the rate of Rs.600. I am a long term investor. Should I hold or exit? - Jeyachandran
Biocon Ltd is Asia's premier bio-pharmaceutical company catering to healthcare globally. The company has improved access to high quality, life-saving biotherapeutics and has made them available at an affordable price. Biocon is among the few global companies to have received approvals for its biosimilars from developed countries like the US, EU, Australia and Japan.
On the financial front, the company posted net sales of Rs.648.10 crore in fourth quarter of FY18 as against Rs.592.10 crore in the third quarter of the same fiscal, showing an increase of 9.4 per cent QoQ. The PBDT of the company has increased by 26 per cent from Rs.93 crore in third quarter of FY18 to Rs.118.90 crore in the fourth quarter. The net profit of the company has also increased substantially from Rs. 43 crore in Q3FY18 to Rs.71.90 crore in Q4FY18, representing a growth of 67 per cent. On the annual basis, the company's net sales have decreased by 7 per cent from Rs.2618 crore in FY17 to Rs.2425 crore in FY2018. The net profit of the company has plunged 54 per cent in FY18 to Rs.238.50 crore as against Rs.519.30 crore in FY17. We would recommend the investors to HOLD the stock for the long term looking at the recent improvements in quarterly results of the company, even though the annual performance has been disappointing.
NBCC LTD I have 5000 shares of NBCC bought at Rs.180. Kindly suggest if I can hold for the long term. - Mahesh
The NBCC Ltd is engaged in providing civil engineering construction services. The company operates in three segments, viz. project management consultancy (PMC), real estate development and engineering, procurement and construction (EPC). The company is executing various development projects in NER for Ministry of Urban Development & Ministry of Housing & Urban Poverty Alleviation. On the financial front, the company's net sales dropped in Q4FY18 by 55 per cent from Rs.1,321 crore in Q3FY18 to Rs.2,184 crore in fourth quarter of FY18. The PBDT of the company has increased substantially by over 130 per cent from Rs.94 crore in Q3FY18 to Rs.220.72 crore in Q4FY18. The net profit of the company has doubled to Rs.141.65 crore in Q4FY18 from Rs.61 crore in third quarter of the same fiscal. On the annual front, the company has posted a slight dip of 5 per cent in net sales to Rs.5,905 crore in FY18 from Rs.6,279.39 crore in FY17. The company's PBDT has increased from Rs.490.26 crore in FY17 to Rs.505.33 crore in FY18, posting a 3 per cent growth. Meanwhile, the net profit of the company has decreased by 5 per cent to Rs.333.61 in FY18 as against Rs.351.10 crore in FY17. The company has shown a rise on a QoQ basis and the company's PBDT numbers have revived. We would recommend the investors to HOLD the stock for the long term.
INFO EDGE (INDIA) LTD I have purchased 250 Info Edge shares at Rs.1300. Should I hold this stock for the long term ? -Nischint
Info Edge (India) Ltd is a holding company and provides information technology services. The company is engaged in online classifieds business. Its segments include recruitment solutions 99acres, online restaurant discovery and others such as Jeevansathi and Shiksha services. The company is engaged in the business of internet-based service delivery, operating in over four service verticals through web portals. Its service verticals include Naukri.com for recruitment-related services, Jeevansathi.com for matrimony-related services, 99acres.com for real estate-related services, Shiksha.com for education-related services, merination.com for online/offline coaching services and zomato.com for online food services. It also offers placement search services, resume sales services and real estate broking services.
On the financial front, the company has posted a 15 per cent growth in net sales in Q4FY18 to Rs. 240 crore from Rs.208 crore in the same quarter of the previous fiscal. The PBDT of the company has fallen by 84 per cent on a YoY basis to Rs.11.51 crore in the fourth quarter of FY18 as against Rs.70 crore in same quarter of the previous fiscal. The net loss of the company was Rs.13.76 crore in Q4FY18 as against Rs.32.87 crore in Q4FY17.
On the annual front, the company has posted a 14 per cent growth in net sales to Rs.915.49 crore in FY18 as against Rs.802 crore in FY17. The PBDT of the company has risen by 6 per cent to Rs.302 crore in FY18 from Rs.258 crore in FY17. The net profit of the company has gone down to Rs.182 crore or dipped by 10 per cent to Rs.182.37 crore in FY18 as against Rs.204.40 crore in FY17.
We would advise our reader-investors to hold the stocks for a longer horizon keeping in mind that the company has posted positive returns in net sales both onquarterly and annual basis, thus the investors can HOLD the stock to reap benefits in the upcoming quarters.
SHEELA FOAM LIMITED I have 400 shares of Sheela Foam bought at Rs.1400. Kindly suggest whether to hold or sell. - Somani
Sheela Foam Limited is engaged in the production of mattresses under the brand name, Sleepwell. The company manufactures other foam-based home products for comfort, focusing primarily at the Indian retail consumers, as well as technical grades of polyurethane (PU) foam for end-use in a range of industries. Its home comfort line consists of products, such as furniture-cushioning, cushions and sofa-cumbeds, as well as PU foam cores utilized for manufacturing finished home comfort products, and comfort accessories, such as bed sheets and baby care sheets. Its mattress line, offered under its Sleepwell range, includes pure foam mattresses as well as hybrids of spring and coir with foam that are capable of customisation as per the requirements of consumers. Its furniture-cushioning line, offered under the Sleepwell and Feather Foam brands, consists of PU foam that constitutes upholstery material of various densities. Through its subsidiary, it manufactures PU foam in Australia.
On the financial front, the company has posted a 13 per cent growth in net sales to Rs.449.21 crore in fourth quarter of FY18 as against Rs.397.99 crore in the same quarter of the previous fiscal. The PBDT of the company has almost doubled to Rs.52.72 crore in fourth quarter of FY18 as against Rs.26 crore in same quarter of the previous fiscal. The net profit of the company has also doubled to Rs.31.87 crore for Q4FY18 from Rs.14.55 crore in Q4FY17.
On the annual front, the company has witnessed an increase in its net sales by 17 per cent to Rs.1695.66 crore in FY18 as against Rs.1445.86 crore in FY17. The company's PBDT has also increased by 17 per cent to Rs.210 crore in FY18 from Rs.179 crore in FY17. The net profit of the company has risen to Rs.125 crore in FY18 as against Rs.110.48 crore in FY17, posting almost 14 per cent growth annually. We would recommend our investors to HOLD the stock looking at the positive financials of the company for long term investment.
KAJARIA CERAMICS Can you advise me on Kajaria Ceramics ? I have 400 shares purchased at Rs.602. I am interested in holding for the long term. -Aditya
Kajaria is the largest manufacturer of ceramic and vitrified tiles in India and ninth largest in the world. It offers products, ceramic wall and floor tiles, polished vitrified tiles, glazed vitrified tiles and sanitary ware and faucets. The company's current annual capacity stands at 68.37 million square metres.
On the financial front, Kajaria Ceramics posted 12.4 per cent increase in its net sales to Rs.701.4 crore in the fourth quarter of FY18 as compared to Rs.624 crore in the previous quarter of the same year. The company's PBIDT increased marginally by 4.1 per cent to Rs.106.4 crore in the fourth quarter of FY18 on a QoQ basis. Also, the net profit of the company increased by over 10 per cent to Rs.65.6 crore in the fourth quarter of FY18 as compared to Rs.59.6 crore in the previous quarter of the same fiscal.
On an annual basis, the company posted a 4 per cent increase in its net sales to Rs.2627.8 crore in FY18 as compared to Rs.2528 crore in FY17. However, the PBIDT of the company decreased marginally by 2.5 per cent to Rs.451.4 crore in FY18 as against Rs.463 crore in FY17. The company's net profit for FY18 dipped by 6.4 per cent to Rs.252.3 crore as against Rs.269.5 crore in preceding fiscal. On the valuation front, the stock is available at P/E of around 31.5x, which is lower than its five-year median P/E of 35x.
The government's effort to push affordable housing is expected to be key trigger for Kajaria Ceramics, as organised tile players derive 70-75 per cent revenue from tier-II and tier-III cities. Also, the GST implementation will lead to shift in demand from unbranded to branded products. Being a market leader, the company is well-poised to capitalize on this shift in demand. Besides, the company is expanding its capacity by 5.60 MSM p.a., which is expected to be completed in the ongoing fiscal. Furthermore, it is targeting to sell 100 MSM tiles by FY21 as against 72 MSM sold in FY18. We would recommend our readers to HOLD the stock.
BAJAJ HINDUSTAN SUGAR I have 5000 shares of Bajaj Hindustan at Rs.31. What should I do now ? Should I hold or exit? - Kansara
Bajaj Hindustan Sugar operates in the manufacture of sugar, alcohol and power generation. The company's segments include sugar, distillery, power and others. Further, it has over 10 sugar plants with an aggregate sugarcane crushing capacity of almost 136,000 tonnes crushed per day. It owns around six distilleries with an overall capacity to produce industrial alcohol of around 800 kilolitres per day. Also, the company has more than 10 co-generation plants having an aggregate power generation capacity of around 450 megawatts.
On the financial front, the company posted a 40 per cent increase in its net sales to Rs.1566 crore in Q4FY18 as compared to Rs.1,119 crore in Q3FY18. However, at the operating level (PBTD), the company reported loss of Rs.154 crore in Q4FY18 as against loss of Rs.148 crore in Q3FY18. Further, in terms of bottomline, the company reported loss of Rs.158 crore in the quarter as against net loss of Rs.148 crore in Q3FY18. On the annual basis, the company posted 29 per cent increase in its net sales to Rs.5938 crore in FY18 as compared to Rs.4618 crore in the previous fiscal. However, at the operating level (PBTD), the company reported loss of Rs.230 crore as against profit of Rs.215 crore in FY17. Also, in terms of bottomline, the company's net loss for FY18 widened to Rs.423 crore as against net profit of Rs.7.4 crore.
On the valuation front, the stock is available at P/S of around 4.8x, which looks quite expensive. The sugar production in the country has already touched record high of 31 million tonnes by April 2018. Further, the sugar production is expected to reach 32 million tonnes by end of September 2018. Due this this, the average price of sugar for a quintal was during the period October 2017-April 2018 declined by 13.3 per cent as against October 2016-April 2017. Going forward, the sugar prices are expected to be under pressure due to excess supply. Moreover, the export of sugar is not vibrant as sugar prices in international markets are also declining. Thus, we recommend our reader-investors to EXIT the stock.
(Closing price as on July 18, 2018) .