Recommendations from Dyes & Pigments & Infrastructure - General 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. 

ASAHI SONGWON COLORS LTD. 

CMP - Rs 246.45
BSE CODE : 532853
Volume : 2,986
Face Value : Rs 10
Target : Rs 270
Stoploss : Rs 226 (CLS)

Asahi Songwon Colors Ltd. is in the business of manufacturing pigments, basically the production of CPC Beta Blue and Blue Crude, exporting substantial produce to leading MNCs around the world on account of the quality of its products. On the standalone financial front, net sales for Q2FY21 were reported at Rs 62.28 crore decreasing by 13.02 per cent compared to Rs 71.61 crore in Q2FY20. Operating profit for Q2FY21 rose by 32.89 per cent to Rs 12.27 crore from Rs 9.23 crore posted in Q2FY20. The company gained net profit of Rs 7.74 crore in Q2FY21, declining by a mere 1.6 per cent compared to its net profit of Rs 7.86 crore gained in Q2FY20. Asahi Songwon Colors recently commenced commercial operations at its plant located at Dahej which is operated through its joint venture with Tennants Textile Colours Ltd., Asahi Tennants Color. Looking at the company’s strong growth potential we recommend BUY.

TEXMACO INFRASTRUCTURE AND HOLDINGS LTD. 

CMP - Rs 54.90
BSE CODE : 505400
Volume : 4,852
Face Value : Rs 1
Target : Rs 61
Stoploss : Rs 50.50 (CLS)

Texmaco Infrastructure and Holdings Limited is mainly engaged in the real estate business and generation of hydroelectric power. Considering the standalone quarterly results, the net sales fell by 17.29 per cent from Rs 6.36 crore in Q2FY20 to Rs 5.26 crore in Q2FY21. The operating profit dropped from Rs 4.77 crore in Q2FY20 to Rs 4.06 crore in Q2FY21. The net profit also declined around 29.75 per cent to Rs 1.46 crore in Q2FY21 as compared to Rs 2.08 crore in Q2FY20. The company continues to derive its major income from leased properties, income from strategic investments and operations of a mini hydro power unit in Darjeeling, West Bengal. Approval of REIT’s by SEBI has opened doors for all kind of investors to invest in the Indian real estate market. India is building 37 hydel power projects with a capacity of over 12,000 MW to be executed in the future. The company’s business is expected to benefit from the uptrend in respective sectors and hence we recommend BUY.

(Closing price as of Jan 25, 2021