Recommendations From Auto Ancillaries And Media Sector

Dalal Street Investment Journal India's No 1 investment magazine selects two aggressive stock picks in every issue, with a 15 day horizon based upon the bullish trend during that period. For this issue, we are recommending companies from the Auto Ancillaries and Media Sector  in Hot Chips Column

BANCO PRODUCTS (INDIA)

CMP: Rs 140.30BSE  Code: 500039 Volume: 51,169 Face Value: Rs 2

Banco Products (India) is engaged in making engine cooling component and engine sealing gaskets in collaboration with Japan Metal Gaskets. The Japanese company is supplying largely to the commercial vehicle makers in India to Tata Motors, Ashok Leyland and Mahindra & Mahindra. Apart from that they are now exporting large chunk of engine sealing gaskets and cooling components which are reaching the developed markets as well including North America, Europe South America and Middle East. It is paying consistent dividend from last eight years. We believe the company will register EPS in the range of Rs 12-14 for FY16. As on September 30, 2015, the company’s book value is of Rs 96.5 per share and also from the net debt level aspect, the company is debt free which makes it attractive at this level. Valuation wise it is also available cheaper compare to its peers.

Dish TV

CMP: Rs 97.35 BSE Code: 532839 Volume: 4,00,322 Face Value: Rs 1

During Q2FY16, Dish TV had a net subscriber addition of 3,38,000, higher than its counterparts. As of March, 2015, the company has 12.9 million net subscribers, up from 11.4 million last year, adding 1.5 million subscribers, double the net adds (0.71 million) in FY14. According to the projections in a CII-PwC report, DTH will grow to 64 million in 2018 from 56 million in 2017 while digital cable subscribers' pie would go up to 90 million from 85 million in 2017. Third phase of rolling would be finished by end of 2015 and then after a gap of a month or two, India will witness fourth phase of digitisation. The company remains upbeat on subscriber additions over the next two or three years on the back of phase III/IV of digitisation.