Recommendations From Chemicals & Power Generation 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.
INDIA GLYCOLS LTD
CMP - Rs 275.15
BSE CODE - 500201
Volume - 24,020
Face Value - Rs 10
Target - Rs 295
Stoploss - Rs 260 (CLS)
India Glycols is a one of the leading companies manufacturing green technology-based bulk, specialty and performance chemicals and natural gums, spirits, industrial gases, sugar and nutraceuticals. On the consolidated financial front, for Q3FY20, net sales reported by the company amounted to Rs 1,541.54 crore which have grown by 24.44 per cent compared to the revenue of Rs 1,238.77 crore for Q3FY19. The PBDT decreased by 17.56 per cent to Rs 55.76 crore in Q3FY20 as against Rs 67.64 crore for Q3FY19. The net profit gained for Q3FY20 is Rs 26.91 crore in Q3FY20, thus contracting by 10.86 per cent compared to the net profit of Rs 30.19 crore gained for Q3FY19. The company has recently declared an interim dividend of Rs 6 per equity share. Along with having a diversified business portfolio, the company has been taking steps to reduce debt, thereby leading to a positive growth trend. Hence, we recommend BUY.
SCHNEIDER ELECTRIC INFRASTRUCTURE LTD
CMP - Rs 84.65
BSE CODE - 534139
Volume - 32,066
Face Value - Rs 2
Target - Rs 93
Stoploss - Rs 77 (CLS)
Schneider Electric Infrastructure Limited (SEIL) is engaged in the business of manufacturing, designing, building and servicing technologically advanced products and systems for electricity network including transformers, medium-voltage primary and secondary switchgears, protection relays, electricity distribution management systems, etc. Looking at the quarterly trends on standalone basis, for Q3FY20, the company reported net sales of Rs 480.69 crore, an increase of 9.91 per cent as compared to net sales of Rs 437.35 crore for Q3FY19. The company reported operating profit of Rs 48.08 crore for Q3FY20, increasing by 56.84 per cent from Rs 30.66 crore for Q3FY19. In Q3FY20 SEIL gained net profit of Rs 30.03 crore as against a net loss of Rs 6.30 crore incurred in Q3FY19. Despite the general economic slowdown, the company’s order intake has rebounded, thus aiding increase in sales. Hence, we recommend a BUY.
(Closing price as of June 02, 2020)