As discussed in Last Analysis 20750 done today so traders who missed the big gap up on Friday were able to enter when bank nifty came down and are rewarded more than 400 points in 2 days for there patience, Waiting for the trade to come is the art every trader need to develop to be successful. As we have closed well above 20750 we are heading towards 21080-21100 where resistance comes as per gann angles shown below, Bearish only on close below 20450 for a move towards 2033320150. High made today was 20958 so still we are not able to do our target of 21000-21100, Till 20750 is held we will be able to achieve the target. Bulls need a close above the green arc for the impulsive move to happen. Bearish only on close below 20500. The Role of Regret in Trading Intraday Traders can use the below mentioned levels Buy above 2430 Tgt FII8217s sold 14.1 K contract of Index Future worth 1017 cores. 8.5 K Long contract were added by FII8217s and 22.6 K short contracts were added by FII8217s. Net Open Interest increased by 31.1 K contract, so rise in market was used by FII8217s to exit long and enter short in Index futures. The Role8230 As discussed in Last Analysis Now as we closed above 20500 we can see another move towards 2075021000. Bearish below 20350 for a move towards 2015020000. Low made today was 20472 and high made was 20702 so bank nifty is moving towards target of 20750. Any close above 20750 can see move towards 21000 and8230 Regrets are fine to have as long as you act on them. Here is a list of common regrets that traders have had over the years and if you can identify them and work to avoid them going forward you can begin to see real progress in your trading results. 8220I did exactly the wrong82301. Sharetipsinfo offers share market tips for StockEquity, FuturesCash and Commodities. 2. Stock market tips of NSEBSE and Commodity tips of MCXNCDEX provided by Sharetipsinfo assures minimum 85 accuracy. 3. For Free Trial give a Missed Call at 080 3063 6424 4. Important Note: Please note some fake company with sender IDs. BZ-PROEMI and MM-SHTIPS are sending manipulated messages and are mentioning our name at the bottom(Sharetipsinfo). Please note: We always send messages in our format with our link at bottom. Our Sender Id is STINFO only. Kindly Ignore all fake messages they might be manipulating some stocks. Today we got GKCONS and SUPRDOM from those fake companies. Kindly Ignore both messages and donot invest in them. We have not recommended any of the above stocks. For Free Stock Market Tips Trial give a Missed Call at 080 3063 6424 Our Services Quick Free Trial give us a missed call at Free Tips Of 22 -2 -2017 Future Intraday For 23 Feb Leading Indian Share Market Trading Tips Provider Market Commentary Welcome to ShareTipsInfo. We provide Indian stock market tips and commodity trading tips to investors and Share market traders. 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Stop Thinking Let Profit Count. Click here for FREE TRADING TRIAL or give miss call at 08030636424 Free Trial Form Latest Happenings at Sharetipsinfo Buy India Cements Ltd. with a target of Rs 178 Dr CK Narayan of Chart Advise has a buy call on India Cements Ltd. BSE 0.29 with a target price of Rs 178. The current market price of India Cements Ltd. is Rs 172.2. Time period given by analyst is Intra Day when India Cements Ltd. price can reach defined target. Dr CK Narayan recommended to keep stop loss at Rs 166. Tata companies will lead, not follow: N Chandrasekaran Soon after attending his first board meeting as chairman of Tata Sons, N Chandrasekaran on Tuesday vowed to make the Tata companies leaders in their respective sectors, offer higher returns to shareholders and initiate a better capital allocation policy. Buy Titan Company with a target of Rs 478 Ashish Kyal of Waves Strategy Advisors has buy call on Titan Company Ltd. with a target price of Rs 478. The current market price of Titan Company Ltd. is Rs 457.25. Time period given by analyst is Intra Day when Titan Company Ltd. price can reach defined target. Ashish Kyal maintained stop loss at Rs 440. UP polls 2017: BJP pulls all stops in the battle for Bundelkhand. The Bharatiya Janata Party (BJP) dominated the campaigning in the Bundelkhand region with its star campaigners Rajnath Singh and Uma Bharti, both Union ministers and prominent personalities in Uttar Pradesh politics, as rallies and roadshows hit their last leg for the fourth phase of the Assembly elections in the state Tata Elxsi Ltd. is gaining traction, Buy for a target of Rs 1525 - Dr CK Narayan Dr CK Narayan of Chart Advise has recommended a buy on Tata Elxsi Ltd. BSE 1.68 at Rs 1496.75 as trading volumes surged to 72415 over previous day. Analyst gave the target of Rs 1525 and a stop loss of Rs 1485 Rajesh Gopinathan faces three challenges at TCS. Gopinathan has challenges. Indias largest IT services firm, with revenues of 16.5 billion, faces headwinds in a market where automation and artificial intelligence are disrupting traditional services segments, but a tougher regulatory environment in its major markets might make the company take a relook at its supply strategy and its impact on margins. Theres a new cartel in town: Insurance firms MUMBAI: General insurers are coordinating product design and premiums by sharing data on occupancies where claims are high in what experts call the first signs of cartelisation of the industry which could have a big impact on customers and it is likely that the Competition Commission of India (CCI) intervenes. Dr Reddys unit fails to clear US FDA audit. Dr Reddys Laboratories on Tuesday informed the stock exchanges the US Food and Drug Administration (US FDA) had made three adverse observations with a Form 483, after completing an audit of its active ingredients (APIs) manufacturing facility at Miryalaguda in Telangana. Buy Tata Chemicals Ltd. target Rs 598. Kunal Bothra Independent analyst Kunal Bothra has recommended a buy call on Tata Chemicals Ltd. BSE 2.05 with an intra-day target price of Rs 598. The current market price of Tata Chemicals Ltd. is Rs 580.55. Kunal Bothra recommended to keep stop loss at Rs 571. IDBI Bank to sell stake in non-core businesses. The board of the bank has approved in-principle proposal to divest some of its non-core investments, subject to compliance with all applicable laws and regulations and final approval obtained for each transaction, IDBI Bank said in a regulatory filing to the stock exchanges. Stock Market Articles Blog Black Money in India If facts are to be believed India got huge amount of black money. Black money reserves exceeds total economy of Thailand. Know the evil effect of black money and also know how black money reserves hampers progress of India. Read more. Money denominations and its affect on Indian stock market Know how money denomination in Indian will affect Indian share market and Indian economy. Also find out ways of dealing with it. India is turning digital and find out various modes by which you can go cashless and can still manage daily needs. This article related to Money denomination is Read more. Moneycontrol a leading stock market portal Earn money in a controlled way via Sharetipsinfo moneycocntrol approach. Know how moneycontrol portal which highlights all major happenings of Indian market plus covers huge collection of news related to stocks and shares can be helpful for share market traders in earning money. Read more. All about forex tips and Forex Signals Get sure forex signals of international Currency pairs, shares, commodities and Indices with 85 accuracy. Know all about forex market for better understanding. Binary Signals for currencies can also give good returns. Read more. Nifty Weekly Newsletter Dated Dec 12, 2016Dec 18, 2016 Know how Indian stock market will perform in this upcoming week and find out all latest happenings, Last week stock market performance, best stocks fr investment and much more in an exclusive Nifty trend weekly newsletter by Sharetipsinfo Read more. Launch of Options Hedging Services Options Hedging services offer risk free option trading. In options hedging services sharetipsinfo provides stock options hedging tips and Nifty options hedging tips. Sharetipsinfo is the first company to launch options hedging services in India. Options traders can earn unlimited profit f Read more. WEEKLY NIFTY TRADING VIEW FOR THE WEEK DEC19, 2016DEC25, 2016 Know how Indian stock market will perform in this upcoming week and find out latest share market tips for investment along with stock news, forex news and much more in an exclusive Nifty trading newsletter by Sharetipsinfo Read more. Why you should get stock tips from experts Want to begin trading Think again Before you begin trading in stock market, share market, commodity market or Forex market. Just make it sure to hire Sharetipsinfo for highly accurate trading recommendations and forex signals. With professional help share market traders can easily earn m Read more. Forex trading basic rules Traders who wish to earn serious money round the clock should start considering Forex market as a good option. Learn all the basic rules, tips and tricks of forex trading in this article exclusively posted by Sharetipsinfo Read more. Risk Free Forex Trading Strategy by Sharetipsinfo Trade risky free in international forex market. Read on to understand what is forex market and to know all its basics. Forex market offers huge returns on investment. Get Forex signals now for sure profit. This article covers all basics of forex trading and how to implement forex signals f Read more. Arun the Stock Guru - Stock tips, Trading Tips, Bse Nse, Share market live, Sensex, Indian Stock market The company was suggested to the premium members few weeks ago. It has moved a good 30 since then. Still looks a company with multibagger potential. People interested for our coming Mumbai workshop as well premium small cap services pls fill the below form. For assistance do whatsappcontact Ujjal at 9831291631 or dip at 9007652301. Improvement in operational efficiency by reduction of manpower and raw material cost (thereby improving ebidta margin). Being 70 yr old co. the cos main strength is offering diverse product range amp designing and customising products according to the clients requirements. Supplying products amp services to almost all the Fortune 500 companies. Improving topline and market share in Railways amp Defence segment, incurring RampD expenses to develop and introduce new technology driven products and thereby improve application of product line in steel, sugar, textile, cement, energy etc. Trying to get back in defence business where we were 15 yrs ago. Looking forward for better results in Q3 and Q4 due to good order inflow for (Mysore plant for oil fill transformers) and growth seen in the abovementioned sectors. Getting orders (revenue) is not a problem for the co, main aim is to reduce the working capital debt and interest burden cost amp improve distributor network. Certain defence orders are in L1 stage(lowest bidder in tenders). Expect huge market for renewable energy in India. Cos top mgt executives have been touring and meeting power station companies. The co will bid for a Water Grid project (Irrigation scheme - provide drinking water from various rivers near AP to all its various cities) and expecting to get an order worth 50 Cr in Telengana state for supplying 1000200 high and low voltage Pump Set (of 12 Lac each). Execution will come in Q3 amp Q4. Recently, the co has got solar project order worth 60 Cr. It is the biggest opportunity for revenue growth. Restructuring undertaken with banks in 2014 for working capital and improving cost of capital. The co has been gradually reducing the Deposits (of 24 Cr) and ICD (of 22 Cr). Make company debt free over a period of time by disposing non core real estate assets of the co. in Hubli of 100 acre near hubli airport, initially earmarked 20 Cr, which will fetch them 120cr (waiting for approval from the state govt to ride over the crisis), Mysore - 5 sites worth approx 50 Cr, Regional Office spaces in Delhi, Hyd, Pune, Bglr etc. (probable model to be adopted by the co. is disposing of and taken back on rental basis). Reducing debt with corporation bank. Total real estate non-core assets of the company is more than 1000 Cr. My view: Recent step taken by the mgt regarding sale of treasury stock worth 18 Cr and QIP issue of 37 Cr was one of the brave and bold step. It has brought positivity and optimism among all the employees of the company and they will work really hard to bring it back to the top. Initial issue of working capital is solved and they have started concentrating on the business. Scuttlebutt from the biggest distributor who is with the company for last 20 years:- If you order LVM motors today u will get it tomorrow. So there is no problem of dispatch in standard motors but if you demand for specialized one then depending upon size, features delivery time gets from 1 month to 6 months. Recent speech from Chairman was fantastic. Expecting very good profit in next 2 years Crompton and abb are also aggressive. This company has huge land bank in banglore and hubli. 8226Ravi series is doing good because of terminal arrangement on top amp side both available. Earlier only side terminal arrangement was available but now both.70 to 80 more efficiency achieved in ravi series, complaint have came down drastically. In terms of sales amp network, the company is like maruti amp lupin. They have purchased new land 5 to 6 years back. It is Trying to increase market share. It is trying to hire big guys from market. 2 to 3 wrong people have chaired in the company due to which last 5 to 7 years were not good. New MD had come recently and is cleaning all dust from the company. He removed all wrong people, all inventory were cleaned. Also fired people who were thinking company like government organization. New MD is silent and aggressive. I have personally felt that he is working very hard. In my 15 to 20 years of experience at the company I can definitely say that things are improving sharply and next 2 to 3 years will be fantastic. I am very optimistic. Trying for new supplier with new people. New MD is pure finance guy and cleaning all inventory. I have personally seen all plants of it and felt that, recently accountability amp responsibility has improved for each and every person. Getting quarries from lost customer which is big achievement as of now. In terms of brand, Crompton, this company, abb is preferred (Order). What happens when a family managed company with good products and a great brand recall changes its PSU approach to be a well managed private one Thats precisely the story of this company. They have given two professional rockstars a free hand to run the show. VB, who was the CFO of the company got promoted to be the MD around 2015. AH, the star salesman with wealth of experience in the industry took the charge of being the sales head. They are churning inside out to transform the company and take it to the coveted league. The problem of the company started with the acquisition of LDW in 2008,a German company known for its technology. The recession followed which made the matter worse for the company. Inspite of every possible support from the Indian parent the German subsidiary couldnt turnaround. Few quarters back it finally gave up and booked the losses. They have imbibed the German technology and with the sector it caters to looking up, better days finally prevails for the company. The company posses rich non core assets to the tune of over 1000crs(mostly land parcels and factories which are not needed). They are in active dialogue to dispose of the same worth 400crs and make the high debt entity a debt free one. Over the course of next 2-3 years, Company would be a lean entity with no more interest cost obligations. Would be prudent to note that the present interest cost of the company would be near 40crs. The end users of its products aka the sugar, power, steel and cement industries have started seeing times changing for good. If your output user marks a rich turnaround, the vendor too will turnaround right Often common sense is very uncommon, notably in case of retailers in terms of selecting listed entities. Our channel checks from its dealers network across the country vindicates the point on the demand front. Customers are having a waiting period of 2-3 weeks for its Ac-Dc motors. Dealers also suggests about the renewed focus from the companys end. It has a near monopoly status in Oil Filled Transformers where its seeing huge demand. Last year they did around 18cr sales. This year they already have orders worth 90crs in hand, comes with double digit EBITDA margins. The company always had orders but owing to working capital crunch they couldnt execute most of it. The condition went so precarious that it had to resort to selling its treasury shares in and around December 2015. It garnered 20crs and finally scripted a turnaround after a very long time. They did a QIP of 36crs recently at 46rs which would further provide relief and help it to achieve the 700crs targeted topline figure. Whats a blessing in a disguise How about accumulated losses of hundreds of crores in its book which means no tax obligation till it surpasses the accumulated losses within the tax window of 7 years. Management did clarify about no MAT either. Conclusion: After exactly 8 quarters or in the December 2015 numbers, company finally came in green. Last 2 quarters been profitable too for the company. It targets a 30 growth where its sales are expected to surpass 700crs this fiscal. Estimated EBITDA of 9 gives us a PAT figure of around 15crs(63crs minus interest cost of 36crs and depreciation of 12crs and with no tax obligation). Company quotes at 23 times fy16-17 earnings. Fy17-18 will see it clocking 880-900crs of sales with higher margin orders. EBITDA expected of around 11 makes the company quote at just 7 times. Turnaround bets are greeted with higher valuation and with the company catering to core sectors, it would always quote in a range band of 15-20. Peers group which are notably the behemoths, your Alstom, Siemens and Abb of the world are quoting at over 30 times fy18 earnings. Also as mentioned earlier in the reports they are targeting to be a debt free entity over the next 3 years. In case that happens, Company could well pen a scripture for itself with shareholders making multi fold over the next couple of years. A delight of a bet in a quintessence meant for your core portfolio. Now dont bother asking the target folks. The quintessential 8 para to know everything about your desired microcap. Lets run: 1)Quote:This is not a fresh stock idea but an extension of the previous post. The intention is to have a detailed coverage of those 5 companies. The desi cloud player one was already long done. Todays note pertains to the 3rd company of the previous post. Indebted to dearest brother Bhaumik for his assistance and scuttlebutt. Its been on a good ride since few days for reasons not known to me. Its an expensively valued stock for sure at present levels( been an expensive stock always yet a 5 bagger in last few quarters).Oh yah, Damn Trying the SEBI compliant way of penning again. 2)Story: 1200 cr Group based out of Kochi 8211 their flagship company is E. Condiments (into spices and curry) with 900 cr. revenue 8211 held 74 by promoters and 26 by Mccormick (US based Fortune 1000 company that manufactures spices, herbs, flavourings). Other group companies are ET(tyre retreading), E. Mattress (beddings with Sunidhra brand) Eastea (into teas), King Richards (garments). There are no cross holdings among group companies. ET is the only listed company and it8217s likely to remain such. No plans of listing E. Condiments. 3) ETs revenue mix 8211 70 open market, 26 SRTC (state road transport companies) and 4 exports. Gross margin are 26, 35, 38 respectively. Debtor days are 40-60 days, 90 days and 90 days with LC respectively. CVs constitute 96 of revenue and 4 comes from PVs. Retreading is gaining traction led by improving awareness, brand creation by players like ET, Indag etc. and cost consciousness for fleet owners. A new truck tyre costs 20k, while retreaded tyre costs 5k and has 80 life of new tyre. Value chain 8211 fleet owners give tyres to dealersretreaders, who in turn procure retreading material from players like ET and do the retreading and give it back to fleet owners. Most retreaders in the market are non-exclusive i. e. they work for all players. Pre-cured retreading is used for CVs, PVs, etc. while hot retreading is used for OTRs, mining vehicles etc. which run on hard surfaces and required more strenuous working. Globally too hot and pre cured retreading technologies are used. There hasn8217t been any material change in technology over many years. 4)50 of replacement demand is met by retreaded tyres in India. Globally that is much higher 8211 in US it is 80 retreaded tyres. Gradually India will move higher towards retreaded tyres as awareness of its benefits increases and also these are environmentally more efficient. So over time share of retreaded tyres will go up. Retreading industry in India is a 3200 cr. industry 8211 50 organized 8211 organized growing at 10 volume growth. This growth is likely to sustain with some gradually shift from unorganised segment. GST can provide a fillip to this shift. ETs volume growth in FY16 was 10. Apollo, MRF etc are looking to enter retreading space 8211 but they don8217t see this as a threat. One these guys have a conflict as they also sell tyres and secondly it8217s too small an industry for them. However, globally there is a big retreading market but it8217s also a very matured. India will take years for tyre OEMs to look at this industry meaningfully. 5)They are in the process of changing their distribution network from only distributors to a mix of distributors and exclusive franchisees. In FY16, 10 of revenue came through franchisees in FY16 (6 in FY15) and they expect it to go up to 40 in FY17. They currently have 46 franchisees and will keep adding these. The advantage is they can charge higher prices by 15-20 through exclusive franchisees and also save on channel margin. This results in 5 higher gross margin. For instance, earlier Midas was selling at 140kg and ET at 120. now ET is able to sell at 170kg. Elgi Rubber currently follows this model of exclusive franchisees. While Indag was following this model but moved to distributor model as they found it difficult to scale it up. In franchisee model the other benefits are there is good brand loyalty and they can control the entire ecosystem and ensure better sales and servicing. However, scalability is an issue which ET is trying to address through ensuring focus on each franchisee and incentivising franchisees by ensuring minimum business etc. 6)They also have 2 retreading centres in Chennai and Bangalore which showcase retreading process and also act as brand centres. They also have Infinity Zones which are for brand visibility and are premium outlets. These outlets also provide marketing support to retreaders. They also organize fleet owners campaigns in each regions wherein they call 100-150 fleet owners and they educate them about the benefits of retreaded tyres and other services and also hear their feedback. This way they are able to get closer to fleet owners. This has helped them target fleet owners directly in some regions rather than depending on retreaders. ET is looking to position itself as a one stop solution for retreading 8211 supply of quality retread material, accessories (gum, cement etc.), maintenance of machinery, skilled labour availability, marketing and awareness of retreading. They have started outsourcing machinery mfg and they supply these machines to retreaders 8211 this ensure consistent good quality material and retreaded tyres. It will not involve any major capex. They also have a training institute where they train labour. 7)Management focus has increased considerably in the last few years and they have also inducted professionals which has led to the above changes. Also earlier the Meeran family was only focused on E. Condiments. But now Mccormick as partner and also that company having stabilized, it will help increase their focus on ET. Raw material price movement is a pass through 1 month lag 8211 so price risk is limited to 1 month. Typically gross margin will improve in times of falling rubber prices and vice versa because of numerator denominator effect. In case of retreaders, falling rubber prices is helpful as they typically don8217t pass on that benefit while they take up the prices in times of rising rubber prices. Rubber prices have shot up 40 in Mar-Apr821716 8211 they have taken a price hike of 11 in May821716 8211 this will largely cover the raw material price hike, they expect rubber prices to correct going forward and eventually not impact gross margin over time. 8)Long term vision is to achieve no. 2 position. Their target is to maintain RMsales ratio of 65 (66.5 in FY15-16). Over time they can do gross margin of 37-38. Current capacity of 12000 MT and utilisation of 45. They can reach 60 utilisation in FY17. They can do 200 cr. revenue with current capacity and 5 cr. capex. Capex of 7-8 cr. over 2 years 8211 5 cr. on capacity and 2-3 cr. on automation at plants. Maintenance capex of 50 lacs. Exports is 4 of revenue and they are targeting to grow it big. This year they are participating in 5 major exhibitions in Germany, Hannover, Kuala Lumpur Delhi etc. They are targeting 50 p. a. growth in exports. No salary is paid to directors as all are family members and most of them own shares in the company. Also they are not actively involved in the running of the business. Discounting trend is up as market is slow. Discount is accounted for as part of other expenses. OPM declined 230bps QoQ in Q4FY16 owing to higher promotion expenses on franchisee ramp up and higher staff costs (fx). While Chinese tyre imports is a threat, their retreadability is bad. Also quality of tyres is bad and is considered unsafe and these tyres breakdown also a lot. They don8217t have any plans of entering any other segment. Indag Rubber has not increased prices post expiry of excise exemption 8211 they will be bearing the costs. No plans of fund raising or increasing promoter stake. KSIDC which holds 11.75 stake is looking to exit and any day expect a big fat bulk deal to happen. No dividend distribution policy in place. Btw: As it can be seen it takes huge efforts to dig into small unheard companies which can be the bluechips of tomorrow. No Reliance or boring Hind Unilever can provide you the kind of money which can help you retire rich early. About to launch some SEBI compliant small and midcap services only meant for long term patient disciplined investors. Do fill the form if that interests you. Happy investing folks. Note: For issues or assistance kindly contact Dipendu at 9007652301. Its been a long time since the blog got updated. Life has changed for good after the launch of Sharebazaar android app. Search Share Bazaar Arun in playstore to download it. In a very short time as you know folks we attained the scale of nearly 30000 subscribers, without resorting to any publicity or marketing gimmick. From conferences to conducting pan India workshops, many things kept me occupied. Soon, will be conducting International workshops, starting from Dubai shortly. Sebi too definitely stood out in terms of screwing the retailers in a better manner. Hence, wont like to name any stocks but hints may just help you to make out the names and dig further on the stories. 1) Been mighty impressed with the Chinese compounder which has also recently changed its name to signify its renewed focus. The parent has achieved an astounding track record of growing 65 CAGR in the last 20 years or so. The Chinese parent quoted at an average PE of over 50 since its listing. Even if it can do a fraction of what parent has done, the stock which comes with almost nil floating stock, would move in a different orbit. Its been a doubler since my Twitter rantspany has recently bagged big orders from IFB and Symphony. Companys fortunes are further set to change as its biggest clients are shifting base from countries like Australia to outsource everything from India. Should keep outperforming coz of its 500crs expansion, parentage and growth prospects. Expensive at present levels but with its expected 50 bottom line growth for next 3-4 years, stock presents an interesting opportunity at slight dips. Its debt free as on date with market cap of around 800crs. Results which should be outstanding comes on 30th May. 2) The desi cloud player hailing from chennai has been a favourite of mine for the last 3 years. Company recently delivered decent set of numbers. Exclude the employee costs and it would look awesome. The company also refrains from taking any orders with gross margins beneath 65-70. Its a massively scalable business with cumulative addressable market size of 2.5 lakh cr which is crazily expanding and set to expand further at 26-30 for coming atleast 5 years. Operating leverage coupled with strong rich tailwinds and an ultra super sales guy( He had started off with a staff of three people in Singapore for Satyam in 2000, and went on to scale up the business into 15 development centres and 33 sales offices across 20 countries with over 4,000 employees. Quit to join HCL-D uring his time, HCLs growth in the region was spectacular,60 percent year-on-year growth, for instance. It became the fastest growing region for HCL) makes a perfect recipe for a potential multibagger. The fiscal 2016-17 should be the best for them. Oh yeah in case the same gold standard honcho resigns, spare no time in exiting it right away. That remains the biggest risk of this particular company. Its debt free as on date with market cap of around 2000crs. 3) Had an amazing Sharebazaar whole day workshop in Cochin recently. Had some spare time which was coolly utilised in visiting the areas of Gods own country. Did get a chance to get glimpses of this companys plant. It comes with a highly credible management which is doing everything possible to create loads of shareholders wealth. Tyre Retreading is gaining traction led by improving awareness, brand creation by the players and cost consciousness for fleet owners. A new truck tyre costs 20k, while retreaded tyre costs 5k and has 80 life of new tyre. They are in the process of changing their distribution network from only distributors to a mix of distributors and exclusive franchisees. In FY16 10 of revenue came through franchisees in FY16 (6 in FY15) and they expect it to go up to 40 in FY17. They currently have 46 franchisees and will keep adding these. The advantage is they can charge higher prices by 15-20 through exclusive franchisees and also save on channel margin. This results in 5 higher gross margin. For instance, earlier Midas was selling at 140kg and the company at 120. now It is able to sell at 170kg. Company is almost debt free as far the long term debts are concerned. Company is set to grow at 30 CAGR for next 5 years. Tyre radialization would be a big theme to watch out for and look no further to ride the theme. Keralas Buffett did make it expensive with his tweets but long term prospects look more than robust. Marketcap stands at around 60crs. 4) It so happened was hell bent on searching for a player which is snatching market share from a giant. Jivanjor, the adhesive player seemed the best fit and I continued with my research. For Scuttlebutt means, interacted with lot of dealers and sales managers but the result wasnt that appealing. Finally, ended my research after a former sales manager disclosed a lot of uninspiring stuff which forced him to quit the company. He also mentioned of his new company and how it has kept him motivated to the extent which has led to a scorching 70 growth in his region. Incidentally, the same company happened to be a listed one which at that time had a tiny Marketcap of just 15crs. The company with a brand name of Euro 7000,is into white glue adhesives, scaled up 11x in the last 5 years and looking to achieve a 100crs bounty by next 2 years. Company got a phenomenal product named D3 which takes 60kgs to provide the required bond while Fevicol does the same in 100 kgs. They have pricing power, got a gross margin of 45-50 and spends a fortune in its marketing front. Company also posses a very strong supply and distribution reach of 7000 dealers in 13 states and 130 cities. Fevicol, over the last couple of years acquired similar companies by paying over 2x Sales. Stock since then has more than doubled with present Marketcap still at a paltry figure of 40crs. Promoters shareholding where 97 of it was pledged has recently been fully released. 5)Its not even required to pen anything for this one. Prem Watsa with his large investments in it, opines craftly. In 2010 Nahoosh Jariwala and three childhood friends and their families were holidaying together at a tiger reserve in Central India. Nahoosh and his older cousin Rajan had founded the company in 1985 and listed it on the BSE in 1995. While Nahoosh had big dreams for the business, Rajan was not so keen, so while still on the holiday Nahoosh8217s three friends decided they would buy out Rajan and support Nahoosh8217s aggressive growth plans. Over the following five years until we came to hear of This company, Nahoosh had exponentially grown its manufacturing capacity from 8,000 to 45,000 metric tons per annum. It is an oleo chemicals company. Oleo chemicals are, broadly, chemicals that are derived from plant or animal fat, which can be used for making both edible products and non-edible products. In recent years the production of oleo chemicals has been moving from the U. S. Europe and Japan to Asian countries because of the local availability of key raw materials. It occupies a unique niche in this large global playing field. It has developed an in-house technology that uses machinery manufactured by leading European companies to convert waste generated during the production of soy, sunflower, corn and cotton oil into valuable chemicals. Those chemicals include acids that go into non-edible products like soap, detergents, personal care products and paints, and other products that are used in the manufacture of health foods and vitamin E. The company8217s customers include major multinational companies including BASF, Archer Daniels Midland, Cargill, Advanced Organic Materials, IFFCO Chemicals and Asian Paints. Co operates out of a single plant in Ahmedabad. It has the largest processing capacity for natural soft oil-based fatty acids in India. Over the last ten years, sales have grown at 23 per year to 27 million, and profit after tax has grown at 30 per year to 2.3 million. On February 8, 2016 we purchased 45 stake from the three friends of Nahoosh and other shareholders at rupees 212 (3.12) per share. My two cents: A tremendous scalable business with high entry barriers. Present headwinds provides an opportunity of a lifetime for value seekers looking to multiply capital over the next 5 years. Btw: We are set to launch some interesting services only meant for long term investors. Interested guys pls mail at arunsharemarketgmail for details. Also you can whatsapp dip at 9007652301. Happy investing folks. Seminars and workshops: About to have long 8 hours Investors Workshop in places like Delhi, Hyderbad and Kolkata over the coming 3 weeks. Do pen a mail at arunsharemarketgmail if you interested in being a part of it. In last Mumbai Workshop, the themes of Jute got discussed and Cheviot incidentally was quoting at about 700 then. Lets pen what attracted me in this company. Note: This days am pretty much occupied with the workshops and seminars which we are having Pan India. The latest venture Share Bazaar Android App has been a huge hit with nearly 30000 downloads over the last few months. Blogs are about to be obsolete owing to technological advancements and hence the decision to migrate everything in the App. Do download the app guys if you havent done yet. Just search Share Bazaar Arun in play store. Quote: Cheviot Company is one of the prime examples of a corporate that makes a lot of money from green fibre and sound investments. Harsh Vardhan Kanoria has created Gold out of an Industry, on which the Sun had literally set with the departure of the British in 1947.Today, with its processing units and a turnover exceeding Rs 265 crore, Cheviot Company makes more money out of Jute and its Corporate Investments, in a year, than most companies would ever make in their lifetime. While Kolkata may hold a different meaning for different people, for the current owners of Cheviot-the Kanoria family, the Sun Never Set On Jute even with the collapse of the British empire. Introduction: Cheviot Company Limited (CCL) which was incorporated in 1897, is the flagship company of the Cheviot group, which has interests in the jute, tea, and leather businesses. CCL manufactures high-value jute yarn and fabrics, such as precision-wound fine jute yarn, sacking cloth, hessian cloth and bags, sacking bags (for packing food grains and other allied purposes), and superior hessian cloth. Spearheaded by Mr. H. V. Kanoria under whose leadership the group has shown exemplary performance year after year. He is an eminent industrialist with 40 years of vast experience in successfully handling Jute, Tea and Leather Industries. The company also ventured into new product category by adding jute shopping bags in their existing product lines. The company caters to both the export and domestic markets. It has two manufacturing units in West Bengal: one in Budge Budge and one in the Falta Special Economic Zone (export-oriented unit). Demand for eco-friendly bags: The demand for green products jute goods like gardening products, shopping bags, geo-textile, pulp and paper, home textiles, floor covering and non-woven textiles is very high at the consumers8217 level in the international market due to the growing awareness about environment. Of those products, jute-made shopping bags are now the best-selling items. Many countries like the United States (US) and the United Arab Emirates (UAE) have already gone for replacement of plastic shopping bags by jute-made shopping bags. The demand for eco-friendly bags is also increasing in Western Europe, Australasia, Middle East, Asia and African countries. The global market size of jute-made shopping bags will be 500 billion pieces, equivalent to seven million tonnes of jute products, in the coming days, as efforts are on to totally stop use of polythene or plastic materials all over the world because of their adverse impact on environment. Fibre of the future: Composite and Compounded materials from man-made fibres (i. e. glass fiber, carbon fiber etc.) are already available as products for consumer and industrial uses. Jute is one such natural fiber that can reduce the impact on the environment. It is available in abundance, strong and is increasingly being referred to as the 8220fiber of the future8221. Jute filled PP composites are today being successfully used for various components and materials. India is still largely an agrarian economy, which needs to generate massive employment in rural areas for a rapidly growing population. Technological breakthroughs such as jute-filled PP compounds show the way for economic development of the masses by marrying state-of-the - art technology and research with cash crops to create rural and industrial prosperity. New Advancement in Jute Compound: Bengaluru-based STEER makes new advancement in jute compounds that ca help in use of fibre in automobile parts (under-the hood),housing construction materials or even microwaveable cooking containers. This New compound can have ripple effect not only on the jute sector, but the entire India economy by opening up a huge market opportunity. Jute polymers to provide excellent opportunity for new sunrise industry to emerge, creation of thousands of jobs in West Bengal, Orissa and Bihar. The popularisation of jute polymers is expected to help provide a major thrust to the Government8217s Make in India campaign, by popularising new usage of jute in other sectors, thus stimulating industrial activity. Jute polymers are certain to greatly benefit the jute industry with its ability to transform the traditional use of jute for modern day products, thus, touching human lives. Advantage over Bangladesh :India and Bangladesh together accounts for the 95 of worlds jute production. The cost of producing quality yarn is 40 per cent higher in Bangladesh than in India because of the technological disadvantages. India has set up composite jute mills with modern machinery and technologies for production of fabrics, dyeing or lamination under one roof. Bangladesh has nearly 250 jute mills, but none of them has the dyeing and lamination facilities, which are essential to producing diversified products, according to exporters. Potential for an anti-dumping tax: Around 125 lakh bales of jute sacks are needed just to package crop seeds in India. Indian jute mills can produce only 25 lakh bales of jute. The Indian Jute Mill Association (IJMA) has already pleaded for an anti-dumping tax in case Bangladeshi goods enter India. The Indian jute commission is considering the plea, and is soon to give a decision about it. This decision is aiming provide a monopoly to Indian jute mill owners which is a very big positive as there are barely few survivors in the industry. Jute Particle Board: They are used as substitutes for wood. The availability of the technologies for producing particleboards and its high socio-economic value are arguments in favour of the future development of this product. The use of wood in house construction, furniture, etc. is slowly being discouraged due to environmental reasons. The use of jute particle board as a substitute has been found to be quite acceptable both in terms of quality and price. Strong Financial Risk Profile: CRISILs ratings on the bank facilities of Cheviot Co Ltd (CCL) continue to reflect CCLs strong financial risk profile, marked by a robust net worth, low reliance on external debt and strong liquidity. The ratings also factor in the strong business risk profile, with an established market position in the jute industry, a diversified product profile, and a wide distribution network. Jute has always been a dull and boring sector. However, several positive advancement drew my attention to this sector. Several innovations ranging from diversified uses of Jute and Jute compounds (as discussed above) implies a turning tables for this sector. Also there has been a rise in demand for jute products all across the globe. Several countries have already banned use of plastic bags in their grocery markets and shopping malls. Thus, demand has been projected to increase 50 times within next five years if the eco-friendly trend continues. Potential for an anti-dumping tax which is a game changer, would provide a monopoly to Indian jute mill owners as there are barely few players in the industry. Recently MD of Gloster (one of the leading Jute players) emphasized in an interview that this is a 8216golden period8217 for the jute industry with several sectoral tailwinds. He guided a robust rise in export demand in coming quarters. He also said that the upcoming quarters will see a very sleek growth which they have never seen before. Concerns: Adverse regulatory changes in the jute industry may impact the top line and thus the regulatory risk would always prevail. Revenues coming in from exports have been a significant rise in past several quarters, fluctuations in currency can pose a threat. Also the RM prices which is Raw jute been on a recent upswing which can put pressure on its margins. Financials: Company over the past 5 years have grown its topline and bottomline at a CAGR of 8 and 13 respectively. But the half yearly results of 2015-16 presents an entirely different picture where the company has delivered an impressive sales growth of 25 to register a figure of 150crs vs 120crs. Profits have more than doubled to 23crs vs 11crs. The third quarter numbers probably should be the best since its inception. Conclusion: I liked Cheviot for its attractive valuations (in terms of EV) along with strong financial risk profile, marked by a robust net worth and low reliance on external debt. It has huge investments and cash on book worth Rs. 200 Cr and it8217s almost debt free. Thus, on EV basis it is available at a very reasonable price. Currently it is quoting at a 6 forward PE and given the tailwinds even a meagre rerating up to 10 PE would make it move way higher. Promoters are owning 75 stake of the company. CCL has also been very generous with its consistent 20 dividend pay-out policy in past 5 years. So even dividends will be 2x with 100 rise in bottom line. Also, CCL doesn8217t needs any capex and has huge reserves so one can expect another fx due to low equity base. (Last fx was in 2006).There are very few listed players in Jute industry in India. All are with very tiny equities and limited floating stock. So even average accumulation can make them run into circuits. BTW:For different stock market related services and also for techno-Funda tutorials, rush a mail at my mail id arunsharemarketgmail to know more about it. Note: The above is not a research report but assimilation of information available on public domain and it should not be treated as a research report. Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: 8220Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations8221 Disclosure: It is safe to assume that I might have Cheviot in my portfolio and hence my point of view can be biased. Readers should consult registered consultants before making any investments. After the launch of my Share Bazaar android app, the workload has increased many a times. Hardly theres any time to do blogging. As you all know the app has been a huge hit with downloads been nearly 25000 in a very small time. For the uninitiated, to download-go to play store and search Share Bazaar Arun. Do give your reviews and ratings folks. Microsec Financial Services AGM Notes (QampA) E-commerce Divisions:- 1. Are we planning to raise Private Equity for both our E-Commerce division Ans: We were anxious when we started both e-com divisions but in retrospect we believe it was one of the greatest decision we ever made. Usually in a typical e-commerce start up, it takes huge amount of cash burning to achieve a GMV of 100crs but we are aiming to achieve that feet by remaining debt free. We are going to set a benchmark by achieving this only from a single state in India (West Bengal) which has been unprecedented in the world of E-commerce. And yes we are looking to raise money for both the verticals. 2. What is the USP of our E-com Services Will ban on selling online medicine(if at all happens) affect us Ans: The USP of the company is our last mile delivery where 99 of the logistics costs are borne by the franchises. (Company gave the examples of newspaper where the logistics costs are Zero.) We dont sell prescribed drugs online. Sastasundar forwards the lead to its offline brickampmortar franchisehealthbuddies and they deliver the order to the customer. Its just a lead generation medium. 3. As medspa, Apollo pharmacy, netmeds, pm ventures are all in the same business as Sastasunder, What are we doing to thwart competition Ans: Competition makes business and the arena is too large. The retail pharmacy market is worth over 70000crs and theres a room for everyone to have their own pie. 4. We are entering Karnataka. What would be the strategy Are we also entering other states Ans: Strategy is to repeat what we are doing in Kolkata. Sastasundar will further expand in Mumbai and other big cities by 2016. 5. In medicine distribution we need large inventories. Even we supply the inventory to our franchise owners. How are we playing it Are we ready for addition in future debt Ans: Company is against too much debt however we may need some for taking care of our WC requirements. 6. What is the ratio of repeat customers to new customers What are we doing to retain our old customers Ans: Repeat Customers contribute to 75 of the present top line. Company is taking all initiatives to retain its existing customers. 7. What is the credit cycle from where we procure the medicines Ans: (Didnt gave a clear answer but hinted of a good credit cycle once they garner in big volumes) 8. How many franchises we have till date What is out average franchise revenue What is the number of franchise we are looking to add over the coming few years Ans: 87 in total, 81 franchise and 6 company owned stores. Company looking to appoint more franchises. Aims for a number of 225 within the next fiscal. 9. What is the ebitda margin we will have after counting for 15 discounts and 8 commission to franchises How can we compete with the retail pharmacist stores Ans: Our medicine distribution margins are 30. The retail pharmacist averages margin of around 20. So theres nothing to worry on that front. Sastasundar makes around 7. 10. How many brands are attached with foreseegames as on date Ans: Its around 120 and yes the target is to tieup with 500 brands ASAP. 11. We brag about 11 lakh users in foresee then why is the revenue is not even 50 lakhs Ans: Foreseegame will see increased monetization from Brand partners going forward, however current strategy is more focused on acquiring more brand partners. 12. Foreseegame itself is engaging but the worst part is we have just 33k likes Facebook on user base of 1.1 million. Why arent we looking at it One of our peer latestone came into the arena much later yet they have 7-8 lakh fans in no time and increasing at a rapid speed. Ans: (The Company appreciated the fact and promised to look into the issue at the earliest.) 13. Why arent we marketing enough We dont see foresee ads in TVs. They are nowhere. We havent even done a SEO, let alone AdWords. Nobody can see us if they Google up online games. Why is it so Ans: Not fond of marketing in the television world. SEO and other needed necessities are actively looked upon which will help the company to increase its users. 14. Have we got a break even target in our verticals When we will break even in e-com verticals Ans: Company looking to break even by fy17-18. Both e-com verticals are exceeding expectations as of now. 15. Do we make profit from every transaction What is the ratio of our private level biz to the medicine biz What is the margin we make from our private biz Ans: We are making profit from most transactions, if not all. The ratio is hardly much to talk about as of now. Private level business margins around 50. 16. What about our recent launches: chef on and others Are we seeing any traction What has been the acceptance of our customers Ans: Chefon: the made to order segment has seen immediate traction after its recent launch. Company is getting 400-500 enquires on a daily basis. 17. In Foreseegame we often provide Sastasunder currency to our game buddies which in turn inflates the topline. Out of 21crs topline in Sastasunder, what has been its contribution last fiscal Ans: That is less than half a percent of the total turnover. 18. Any revenue guidance for foresee and Sastasunder in the present fiscal Next year 17 and by 2020 Ans: Foreseegame should more than double its turnover this year. Sastasundars GMV should be heading to 100crs within the next few quarters. 19. Zapak games recently got valued at 1000crs, be it alexa rank or minutes spend in the site it8217s beneath foreseegame by every standard. Are we looking to unlock value by divesting a stake Ans: Lot of offers from private equity. Foreseegame will dilute in favour of a private equity to unlock value. Should be done at a good valuation. 20. Ironically whenever we announce our results, we see our stock being hammered owing to higher losses. Would we see the same in future Ans: (We aren8217t bothered about stock prices or market cap. The company is in a solid footing and with time, the right valuation should definitely chip in.) Financial Services Division:- 21. It8217s been quite a while since the demergerdivestment news was announced by the company. When is it actually happening Ans: Our core was finance and its a pretty emotional decision to hive off the same. However, we believe in being ahead of the time and hence will soon do what8217s best for the business. 22. We have a capital employed of over 100crs in the financial vertical. We have got large holdings running worth several Crs. We did a PAT of 10crs. Its a brand with intangibles adding up to a good few Crs. Tailwinds are blowing with few recent brokerage deals. Sudhir Valia acquiring fortune financial at 35crs and Sudip banerjee buying out JRG sec at 100crs. So we should get a good valuation right Ans: (They appreciated the fact and hinted about a good deal coming soon. Fathoming the body language, it seems like they will just sell the finance arm rather than demerging it as the full focus is on ECOM.) 23. Presuming we will sell out the Financial Services Division as admitted by Mr mittal earlier, how are we going to deploy that money Would it be fully on Ecom Or can there be a special onetime dividend Ans: As of now we are not in favour of a dividend as the stock price would just adjust it immediately. The money received would be deployed in the ECOM ventures. 24. Promoters own 71 in the company as on date, bit below the max permissible limit of 75. Why arent you buying out the rest This fiscal year the promoters hardly bought anything. Ans: Microsec is the only stock we acquired in last few years. We desire to own the maximum permissible limit of 75 soon. 25. We had an internal target of achieving a billion dollar market cap by 2020. How achievable does it look under the present juncture. Ans: Futile to discuss about market cap at the present juncture. We believe in long term wealth generation for the stakeholders. 26. Is there any chances of selling out fully provided we get an extravagant offer, at a much premium to the present price Ans: No chances of selling out in the next 5 years. What I Perceive: Finance business to be sold soon and then in due course would be demerged in two separate companies. Sastasundar and Foresee to be separately listed in the future. P. s:Please refrain from asking buyingselling stuff. BTW:For different stock market related services and also for techno-Funda tutorials, rush a mail at my mail id arunsharemarketgmail to know more about it. Note: The above is not a research report but assimilation of information available on public domain and it should not be treated as a research report. Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: 8220Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations8221 Disclosure: It is safe to assume that I might have MICROSEC in my portfolio and hence my point of view can be biased. Readers should consult registered consultants before making any investments. 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