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Sunday, March 30, 2008

Stocks that can double from current level

Hitachi Home & Life Solutions (India)

Hitachi Home & Life Solutions (India) Ltd., a subsidiary of Hitachi Home & Life Solutions, Inc., Japan, is headquartered in Ahmedabad, Gujarat, the company's manufacturing facility at Kadi is among the seven Hitachi room air conditioner facilities worldwide. The Indian plant also exports Hitachi room air conditioners to the SAARC, Middle East and other tropical countries in addition to catering to the Indian market.

It has a nationwide sales, distribution and service network. It has 14 Branches, 250 Sales and Service Dealers, more than 800 Showroom Dealers and 350 Service Points. Hitachi currently has a market share of around 45% in the Indian split AC segment market. Apart from air conditioners the company also sells Chillers, Refrigerators and Washing machines in the Indian market. The Refrigerators and Washing machines are imported and were introduced during the financial year 2005-06. These products are well received and expected to have a annual growth of 35%.

At the current market price of Rs. 110/- the stock trades at around 6.4 times it's trailing 12 month EPS of 17. With new product range and Increasing domestic and Infrastructure spending we expect the demand for Hitachi products to continue and expect the company to clock a annual turnover growth of 30 to 35% for the next two years. Investor with medium risk profile can enter into this stock with a target of Rs. 195/- over the next 12 to 18 months.

Ramsarup Industries

Ramsarup Industries manufactures low relation precast steel wires, galvanized wires and TMT bars. The company caters mainly to power and Infrastructure. Power transmission sector accounts for around 40% of ramsarup revenues and the rest from construction and infrastructure.

At the current market price of Rs. 143.65/- the stocks trades at less than 5 times it's expected FY08E earnings. With repeat orders from the existing client tele and the expected capacity expansion in place we expect the revenues to grow at an annual rate of 35 to 40%. We recommend the stock to investors with medium risk appetite and a possible target of Rs. 295/- with a horizon of 18 to 24 months.

Posted by Srivatsan

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1 comment:

Anonymous said...

Nice blogs with good amount of Information. Keep going.

April 4, 2008 at 10:38 PM

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Fundamental Analysis

Fundamental Analysis is the cornerstone of Investing. In fact, some would say that you aren't really investing if you aren't performing fundamental analysis.

During fundamental analysis we look at a stock from three aspects

Company

At the company level, fundamental analysis may involve examination of financial data, management, business concept and competition.

Industry

At the industry level, there might be an examination of supply and demand forces for the products offered.

Economy

Fundamental analysis might focus on economic data to assess the present and future growth of the economy.

To forecast future stock prices, fundamental analysis combines economic, industry, and company analysis to derive a stock's current fair value and forecast future value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either over or under valued and the market price will ultimately gravitate towards fair value. Fundamentalists do not heed the advice of the random walkers and believe that markets are weak-form efficient.