Recommendations from Trading & Plantations-Tea & Coffee 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.
CCL PRODUCTS (INDIA) LTD
CMP - Rs 431.70
BSE CODE : 519600
Volume : 81,342
Face Value : Rs 2
Target : Rs 480
Stoploss : Rs 400 (CLS)
CCL Products (India) Ltd is engaged in the manufacture of Soluble Instant Spray Dried Coffee Powder, Granulated Coffee, Freeze Dried Coffee, as well as Freeze Concentrated Liquid Coffee. The company's product range includes Pure Soluble Coffee, Decaffeinated Coffee, Flavoured Coffee. The company is also in the business activities of Instant Coffee. It has witnessed growth on the quarterly front. The net sales increased recording a 4.5 per cent growth at Rs 336.63 crore in Q2FY22 versus Rs 322.14 crore in Q2FY21. The operating profit also improved from Rs 77.61 crore in Q2FY21 to Rs 82.50 crore in Q2FY22. The quarter resulted in the progress of net profit Rs 47.46 crore in Q2FY21 crore to a net profit of Rs 49.34 crore in Q2FY22. CCL is amongst green coffee bean processors globally. It is also India’s largest exporter to private labels having approximately 10 per cent global market share. Over the past two decades, it has increased its capacity and managed to keep its debt in check. Its business model is robust, by virtue of it being a sticky business, it has the best-in-class technology, superior economies of scale and res and resilient margins. Hence, we recommend BUY.
SWAN ENERGY LTD.
CMP - Rs 148.55
BSE CODE : 503310
Volume : 14,569
Face Value : Rs 1
Target : Rs 165
Stoploss : Rs 135 (CLS)
Swan Energy Limited (SEL) was originally incorporated in 1909 as Swan Mills Ltd (SML), a manufacturer and marketer of cotton and polyester textile products in India. Swan Energy is an India-based holding company and it is engaged in the manufacturing of textile products. Analyzing the quarterly financial performance, the company delivered net sales of Rs 59.45 crore in Q2FY22 as compared to Rs 87.45 crore in Q2FY21. The operating profit of the company has increased by 123.5 per cent in Q2FY22 and stood at Rs 28.06 crore, as opposed to the last Q2FY21, which was 12.55 crore. The company has a net loss for this Q2FY22 of Rs 37.34 crore versus the net loss of Rs 8.94 crore in Q2FY21. Swan Energy Limited has joined Hazel Mercantile Limited (HML) as a strategic partner through SPV. It is an event Resolution Plan submitted by HML to acquire Reliance Naval and Engineering Limited (RNRL) from NCLT. The stock price has shot up 28.09 per cent in the past month. Hence, we recommend BUY.
(Closing price as of Dec 27, 2021)