Recommendation From Finance and Tyres Sector
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DSIJ 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 Finance and Tyres Sector
Delta Corp
CMP: 145.60
BSE Code: 532848
Volume: 20,82,887
Face Value: 1
Delta Corporation is a gaming and hospitality company engaged in operation of three casinos and two hotels in Goa. The company's business segments include real estate, gaming, hospitality. The company’s share has recently hit its all-time high at 140-145 mark. On the financial font, the company’s revenue increased by 34.6 per cent to Rs 108.66 crore in Q1FY17 as compared to the same period in the previous financial year. The company’s EBITDA too rose by 78.9 per cent to Rs 41.55 in Q1FY17 on a yearly basis. EBITDA margin saw a gradual growth of 38.2 per cent from 28.5 per cent YoY. Its net profit for Q1FY17 thereby rose to Rs 20.08 crores as against a minimal profit of Rs 0.1 crore during the corresponding period of last year. The company’s casino segment revenues increased by 36.5 per cent to Rs 96.28 crores in Q1FY17 on yearly basis. Its hospitality segment revenues rose by 59.5 per cent to Rs 16.88 crores as compared to same period in previous financial year.
JK Tyre & Industries
CMP: 130
BSE Code: 530007
Volume: 11,98,192
Face Value: 2
As the name suggests JK Tyres, a part of JK Group is engaged in the manufacturing of automotive tyres. The company operates 12 plants in India and three plants in Mexico through tyre, tubes and flaps segment. Recently the tyre companies zoomed on falling the natural rubber RSS 4 grade to Rs 129/kg from Rs 145 at the beginning of August 2016. On financial front, its consolidated revenue rose marginally by 0.8 per cent to Rs 1780.75 crores YoY. JK Tyres’ operating profit margin rose 17.75 per cent as against 16.46 per cent YoY. The company’s net profits however, dropped 16.7 per cent to Rs 100.26 crores amid considerable expenditure in interest and depreciation. The company is planning expansion to achieve its production target of 3.5 crore truck radials in FY18. JK Tyres recently was in talks to enter into civil aviation sector to expand its business by offering supply parts to aircraft manufacturers.