Recommendation From Breweries & Internet Sectors

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations. 

UBL 

CMP - Rs 1379.70
BSE CODE 532478
Volume 54600
Face Value Rs 1
Target Rs 1537
Stoploss Rs 1250 



Vijay Mallya promoted United Breweries is engaged in manufacturing and sale of beer, brand licencing. The financial reports for FY18 overcome a slight de-growth in FY17 with topline and bottomline surging 18.6% and 72%, respectively. This was despite ban on sale of liquor within 500 metres of highways, rise in excise duties and changes in route-to-market by few states. The company’s premium brands of Heineken, Kingfisher Ultra, Kingfisher Ultra Max grew 30%, 59% and 80% YoY, respectively. Brand launches and geographic penetration helped grow the topline and reduced selling and distribution cost and 50% reduction in net debt pulled the bottomline up. Even Q1FY19 posted sales and PAT growth of 26.8% and 144% over the previous quarter. Going forward, the company is expected to penetrate non-alcoholic beer segment and introduce craft beer offering in Q3 and Q4 of FY19, respectively. Finally, considering the expected CAGR of 7.6% in the beer industry in volume terms over FY18-24 and the company’s rising market share, we recommend a BUY.

 NAUKRI 

CMP - Rs 1521.65
BSE CODE 532777
Volume 579
Face Value Rs 10
Target Rs 1695
Stoploss Rs 1401 



An information technology services provider is engaged in online classifieds businesses, including recruitment platform through Naukri.com, realty under 99acres.com, online restaurant discovery, matrimonial services under Jeevansathi.com and higher education services under Shiksha.com. The company earned 73% from recruitment and 14.8% from 99acres in FY19. It saw revival in its recruitment business with 15.4% billing growth in Q1FY19, after the slower growth in FY17/18 gainst FY15/16. It posted revenue growth of 7.9% and posted net profit of Rs 63 crore from net loss of Rs 14 crore in Q4FY18. Even 99acres posted 25% CAGR, despite slowdown in realty. The IT and ITES segment under recruitment, which forms 40-42% of recruitment revenue, is expected to rebound in FY19/20 amid peak utilisation, dollar appreciation and high attrition. The RMS/CMS segment launched couple of years back is expected to gain traction. Investments in Zomato (30.9% stake) and reinvestment in PolicyBazaar (13.6%) would prove beneficial for the company with growth prospects in their businesses. We recommend a BUY.