Query Board
Query Board
HINDUSTAN UNILIVER
I bought 100 shares of Hindustan Uniliver at Rs 1663. Kindly suggest whether I should hold or sell this stock.
- Venkatraju
Hindustan Unilever is a leading fast-moving consumer goods business engaged in the manufacture of home and personal care products and foods and refreshments. The company has various segments ranging from soaps and detergents, which includes soaps, detergent bars, detergent powders, detergent liquids and scourers. Another segment is the personal care products, which includes products in categories of oral care, skin care (excluding soaps), hair care, deodorants. The beverages segments include tea and coffee and the packaged food segment. On the financial front, the company’s net sales stood at Rs 9,487 crore, up marginally by 2.87 per cent in Q1FY19 versus Rs 9,222 crore in the same quarter of the previous year. The PBDT of the company has grown by 18 per cent YoY to Rs 2,320 crore in Q1FY19. The net profit of the company has also shown a growth of 19 per cent to Rs 1,529 crore in Q1FY19 versus Rs 1,283 crore in Q1FY18. On the annual front, the net sales recorded in FY18 were Rs 35,218 crore, posting a growth of 2 per from Rs 34,487 crore in FY17. The PBDT of the company has risen by 14 per cent in FY18 as against Rs 6,792 crore in FY17. The net profit of the company has gone up by 16 per cent to Rs 5,237 in FY18 as against Rs 4490 crore in FY17. Looking at the financial figures, it is evident that the company has been growing. Thus we request the investor-readers to HOLD the stock
JINDAL STEEL AND POWER
I hold 100 shares of Jindal Steel and Power bought at Rs 272. What is your view on the stock?
- Deepakar Kumar
Jindal Steel and Power is engaged in the production of steel. The company’s segments include iron and steel, power and other. The other segment consists of aviation services and machinery division. The company’s scope consists of steel product mix, construction solutions and construction materials and solutions. Its steel product mix category includes rails and head hardened rails, parallel flange beams and columns, angles and channels, plates, coils and wire rods. On the financial front, the company’s net sales have increased significantly by 75 per cent to Rs 6,733.90 crore in Q1FY19 as against Rs 3,831.54 crore in Q1FY18. The PBDT of the company in Q1FY19 has grown tremendously by over 300 per cent to Rs 1039 crore versus Rs 217.22 crore in the same quarter of the previous financial year. The net profit of the company recorded in Q1FY19 was Rs 332.28 crore, as against the net loss of Rs 177.73 crore in the same quarter of the previous year. On the annual front, the company’s net sales have grown by 13 per cent to Rs 17,523 crore, as against Rs 15,493.61 crore in FY17. The PBDT of the company recorded in FY18 was Rs 1,237 crore as against Rs 586 crore in FY17. The net loss of the company has narrowed down to Rs 361.61 crore in FY18 versus Rs 986.45 crore in FY17. The company’s financials show an improvement overall. We expect the upcoming quarters to be better, thus we recommend a HOLD to our reader-investors looking at the abovementioned factors.
SINTEX PLASTICS TECHNOLOGY
SPTL (Sintex Plastics Technology Ltd) bought 25,000 shares at Rs 46. Whether I should hold or sell.
- Siva Kemburi
Sintex Plastics Technology Limited operates through divisions, including custom moulding solutions and building products and solutions. The moulding solutions is engaged in moulding and post-moulding operations. The building products and solutions manufactures water storage tanks, prefab and construction for mass housing. The company’s solutions comprise of structural solutions, electrical solutions, water management solutions, environmental solution, energy solutions, interior solutions, material handling, telecom solutions and industrial solutions. The company’s product offering includes water storage solutions, electrical and SMC products, environmental and green solutions, industrial, prefabs, interiors and BAPL. Water storage solutions include Sintex triple-layer water tanks, Sintex black water tanks, Sintex loft water tanks, Reno water tanks, RenoTuf water tanks, Sintex underground water tanks (FRP) and SMC panel water tanks.
On the financial front, the company’s net sales stood at Rs 1,325 crore in Q1FY19, dropped by 12 per cent from Rs 1,509 crore accrued in Q1FY18. The PBT in Q1FY19 was Rs 34.47 crore showing a decrease by 68.22 per cent from Rs 107.86 crore in Q1FY18. The net profit of the company in Q1FY19 was Rs 37.53 crore, down by 45 per cent from Rs 68.65 per cent in the same quarter of the previous year.
On the annual front, the company’s net sales stood at Rs 5,535.96 crore in FY18 as against Rs 5,994 crore in the previous financial year, showing a decrease of 7 per cent. The PBT has gone down by over 60 per cent to Rs 196 crore in FY18 versus Rs 554.62 crore in FY17. The net profit has also gone down by 67 per cent to Rs 135.77 crore in FY18 versus Rs 419.61 crore.
On the valuation front, the company has return on equity (RoE) of 4.71 per cent and return on capital employed ( RoCE) of 6.23 per cent. The company delivered disappointing numbers, but the upcoming quarters could show improvement and thus we would advise our reader-investors to HOLD the stock.
DCM SHRIRAM INDUSTRY
I bought DCM Shriram Industry Ltd at Rs 324 per share. Should I wait further for the stock to reach my purchase price level ? Kindly share your recommendation.
- Kardeep Kumar
DCM Shriram Industries Ltd. is a conglomerate engaged in three main business areas, namely, agri-rural, chlor-vinyl and value-added business. The agri-rural business provides farm solutions, hybrid seeds, urea, fertilisers and sugar. The chlor-vinyl business provides basic chemicals and raw materials such as caustic soda, chlorine, calcium carbide, PVC resins, PVC compounds, power and cement. These are crucial for the nation’s industrial economy.
The company launched Fenesta UPVC business systems in 2003 as a value-added business. The company specialises in designing, manufacturing, installing and servicing precisionengineered, 100 per cent customised doors and windows. DCM Shriram’s portfolio of products includes sugar, alcohol, fine chemicals and rayon tyrecord.
On the financial front, the company reported revenue of Rs 464.55 crore in Q1FY19 as against Rs 494.01 crore in Q1FY18, posting a decline of 5.96 per cent. The company reported an EBITDA of Rs 43.65 crore in Q1FY19 as against an EBITDA of Rs 56.34 crore in Q1FY18, a decline of 22.52 per cent. The net profit has fallen to Rs 23.25 crore in Q1FY19 from Rs 32.58 crore in Q1FY18, thereby marking a decline of 28.63 per cent.
The annual financial results look more promising. The company’s revenues increased to Rs 1,726.26 crore in FY18 from Rs 1,495.82 crore in FY17, posting a growth of 15.40 per cent. The company reported EBITDA of Rs 116.10 crore in FY18 versus Rs 199.88 crore in FY17, thereby posting a decline of 41.91 per cent. The net profit dropped 52.24 per cent to Rs 57.56 crore in FY18 from Rs 120.52 in 2017.
The recent hike in ethanol prices is beneficial for the sugar industry. The shares of sugar companies surged as much as 20 per cent on September 14, 2018 after the government raised ethanol prices by over 25 per cent. Considering these factors, we recommend our reader-investors to HOLD this stock.
TVS MOTOR
I hold a few shares of TVS Motor and I am a long term investor. Should I accumulate more, hold or sell it ?
- Sohan Barhate
TVS Motor ranks as the third largest manufacturer of two-wheelers in India. The company makes motorcycles, scooters and mopeds. It is the largest flagship company of the TVS group in terms of size and turnover. The company has four manufacturing plants, three of which are within India in Tamil Nadu, Karnataka and Himachal Pradesh, while one is situated in Indonesia at Karawang.
On the financial front, the company reported an increase of 22.18 per cent in total income from operations at Rs 4,153.70 crore in Q1FY19 versus Rs 3,399.51 crore in Q1FY18. The EBITDA in Q1FY19 stood at Rs 323.78 crore, while it was Rs 268.50 crore in Q1FY18, posting a growth of 20.58 per cent. The net profit was Rs 146.61 crore in Q1FY19 as against Rs 129.47 crore in Q1FY18, posting a rise of 13.23 per cent.
On the annual consolidated financial front, the company’s sales increased 30.74 per cent to Rs 16,295 crore for the year ended March-2018 versus Rs 12,463 crore for the year ended March2017. Consequently, the EBITDA for the year ended March2018 was recorded at Rs 1,643 crore in comparison to Rs 1,035 crore for the year ended March-2017, posting a growth of 58.74 per cent. The net profit of Rs 652 crore for the year ended March-2018 posted an increase of 27.59 per cent as against Rs 511 crore for the year ended March-2017.
Based on the 2017-18 financial performance, the company continues to grow ahead of the industry for the third year in succession, reporting a surge of 17.8 per cent, 25.8 per cent and 30.4 per cent in sales of two-wheelers, motorcyles and threewheelers, respectively, over the last year. The company has reported consistent profit growth of 40.06 per cent over the last five years. Its track record of 26.31 per cent ROE for three years is good. Furthermore, the company has maintained a healthy dividend payout of 24.76 per cent. By virtue of these promising financials and valuations, we recommend our reader-investors to HOLD the stock.
SUBEX
Please let me know the future prospects of Subex Ltd.
- Naval Manoj
Subex Ltd. is a telecom analytics solutions provider operating in the IT Consulting and Software industry. Founded in 1992 and incorporated in 1994, it caters to 75 per cent of the world’s top 50 telcos. It provides three key services to communications service providers (CSPs) namely - driving new business models, enhancing customer experience and optimizing the enterprise. They provide analytics solutions in the field of business, operations and infrastructure. In addition, they also offer Business Consulting services and scalable Managed services. Some of the next-generation solutions that Subex is developing include Advanced Data Analytics, Business Intelligence, Business Assurance and Internet of Things (IoT).. They have to their credit, over 300 global installations across more than 90 countries, over 200 global customers and over 25 years of experience.
On the consolidated financial front, the sales stood at Rs 75.91 crore in Q1FY19 as against Rs 76.18 crore in Q1FY18, thereby posting a drop of 0.35 per cent. EBITDA was reported at Rs 9.93 crore in Q1FY19 as against Rs 5.06 crore in Q1FY18, thereby posting a 96.24 per cent increase. The company reported a net profit of Rs 3.95 crore in Q1FY19, which is a significant improvement as it had incurred a net loss of Rs 1.01 crore in Q1FY18.
On the annual front, the sales dropped 9.23 per cent from Rs 324.32 crore for the year ended March-18 to Rs 357.33 in the year ended March-17. The EBITDA of Rs 47.33 crore showed a dramatic improvement in March-18 as against a negative EBITDA of Rs 8.27 crore in March-17. The company reported a net profit of Rs 20.68 crore for the year ended March-18 as against a net loss of Rs 43.23 crore for the year ended March-17. These figures are on a consolidated basis.
Based on these financials and the fact that the company is virtually debt-free and trading at 0.41 times its book value, we recommend our reader-investors to HOLD this stock.