Graphite India Ltd. looks attractive

By G. S. Roongta
After ten consecutive days of rise in stock prices – perhaps the longest, the stock market made a halt on Thursday, 4th
October 2007, having witnessed a very volatile session a day earlier on Wednesday, 3rd October 2007, resulting in a record
two way movement of nearly 1500 points with the BSE Sensex touching a new high of 17953.07 only to fall to 17288.41
and rise again to close at 17847.04 through intra-day swings.
Despite such never before witnessed volatility fuelled by record buying by FIIs over the last few days, there was no
specific reason for the market to turn so bullish as far as the CNX Nifty was concerned. Going by detailed analysis, there
were hardly 40 stocks that participated in fuelling the bull sentiment. Prominent among them were the Reliance Group
shares: RIL, Reliance Energy, Reliance Communications, Reliance Petroleum, Reliance Capital, Reliance
Natural Resources followed by capital goods, realty and bank stocks like ICICI Bank, SBI and HDFC
Bank.
G.S. Roongta
As such, trading was very restricted and at times very narrow. Even the advance-decline ratio was
stretched without showing any specific positive bias vis-à-vis the grand rise of the Sensex stocks.
In the A Group, 119 stocks rose while 101 declined. In the B1 & B2, 526 stocks rose while 983 declined. In
the small-caps, 466 stocks rose while 611 declined.

Dividend: GIL has rewarded shareholders fairly well with 100% as interim dividend and another 50% as special and final
dividend taking together as dividend totalling 150% for FY07.
Market Price: GIL’s share price, which had touched over Rs.300 in early 2005-06 for Rs.10 paid-up share is still hovering
around or below its two years high. Since its price has fully consolidated for quite a long time and the major shareholding
lies in strong hands, there is no reason why the stock should lie low any further.
The current share price of Rs.56 to Rs.58 looks very attractive in the above context and readers may take a position based
on their ability and power to hold on till they reap a good harvest.
I may mention here that I had earlier recommended Modern Steels Ltd. at cum bonus price of Rs.76 in the issue dated
Aug. 27 – Sept. 2, 2007.
The price of this stock at ex-bonus is now ruling around Rs.54-56 and means cum-bonus price at Rs.140, a fair gain of
nearly 100% in just one month. Those who wish to book profit may do so without blaming later on that its share price has
come down. It is the readers’ choice to hold or book profit. It may also be noted that Modern Steels when recommended
witnessed an upper lock for weeks together and is again in the upper lock now for the last three trading sessions.

Ferro alloys Stocks

* Ferro alloys prices have further firmed up in the current year. As silicon manganese is now around Rs.78,000 per tonne, ferro chrome around Rs.94,000 per tonne, ferro manganese around Rs.80,000 per tonne, Navbharat Venture, Ferro Allloys, Rohit Ferro Tech, Impex Ferro may get good benefit.
,nse

NCL Industries

By Nayan Patel
NCL Industries
BSE Code: 502168
NSE Symbol: NCLIND
Last Close: Rs.40
NCL Industries Ltd., an ISO 9001:2000 company, made its debut in the Indian industrial scene way back in 1983 by setting up a 200 TPD cement plant at Simhapuri in Nalgonda District, Andhra Pradesh. The plant was expanded in stages to 1800 TPD with a split grinding unit at Kondapally. With this, the present capacity increased from 2,97,00 TPA to 6,30,000 TPA. The company has started identifying building materials which are best suited for the Indian construction industry. Several units have been established with proven technologies from Europe. The company is also interested in Construction, Power Generation and Manufacture of Chemicals.
It has an equity of Rs.32.50 cr. and the promoters hold 40.24% stake in the company. It has shown very good results for March 2008 quarter. Net sales jumped 103.77% to Rs.66.98 cr. and PBT jumped 634.22% to Rs.13.73 cr. Due to high tax outgo, its net profit jumped 15.48% to Rs.8.95 cr. On a yearly basis, net sales of the company jumped 29.97% to Rs.192.73 cr. while profit before tax jumped 45.33% to Rs.42.93 cr. The company has recorded an EPS of Rs.9.32 on a yearly basis. At current levels, the stock is available at P/E ratio of just 4.3. The company has declared 25% dividend for this year compared to 20% last year. At current levels, the stock looks safe for investors and is available with an attractive dividend yield. Buy at every decline with stop loss of Rs.37. On the upper side, the stock can go up to Rs.52 level in a short time and to Rs.65 level in the medium-term. Its 52-week high/low is Rs.94.50/34.75.

Infosys Technology LTD

Annual Report Analysis
The Infosys Annual Report 2007-08 contains a human touch with the key theme being various company initiatives towards attracting, training, retaining and empowering talent. FY08 was another watershed year for Infosys with robust business performance (industry-leading dollar growth), judicious expenditure management and strengthened financial position. Infosys, the behemoth, continues to move from strength to strength. Our analysis of the Annual Report revealed following interesting findings.
ä Income Statement – robust growth and unparalleled size and profitability
ä Special dividend and increase in payout ratio reflects company’s confidence in growth
ä Balance Sheet – strong, debt-free and highly liquid
ä Superior return ratios generate positive EVA
ä Cash Flows – more than sufficient to cover growth, dividends and contingencies
ä Corporate Governance – leading across industries
ä Re-organization to sustain competitiveness
However, we maintain SELL on Infosys as current valuations are above fair value. Our target price of Rs1,670 represents 10% downside.

Jayswal Neco

Jayswal Neco (Rs. 48.00) (Code 522285) :-

Stock price of the Nagpur based company Jaiswal Neco has increased by 15 per cent during last one month, because the company has joined one time settlement scheme for clearing debt. According to the informed sources the company has OTS worth Rs. 200 crores. As per the settlement agreement company will settle all its due, will require 80 crores for the same. The news of company joining OTS scheme has resulted in increased activities on the counter. If OTS is materialized company is likely to get good benefit of the same. The company is planning for corporate debt restructuring mechanism. Investors may invest in the scrip for long term at current market price.

Dividend Announced

Deepak Fertilizers ,Punj Lloyd

Opto Circuits India

Opto Circuits India

Cluster: Emerging StarRecommendation:

BuyPrice target: Rs460

Current market price: Rs338
A growth monitor
Key points
Opto Circuits India’s (Opto) non-invasive business is expected to grow at a compounded annual growth rate (CAGR) of 39.5% over FY2007-10E to Rs550.7 crore on the back of rising demand for its sensors and patient monitoring systems, coupled with an increasing market penetration and innovative new launches.
The invasive business would be driven by the increasing acceptance of the company's stents due to superior technology and better pricing. Further, the growing revenues from DIOR in Europe and the semi-regulated markets due to limited competition would also fuel the growth of the invasive segment. We expect the invasive segment (EuroCor) to contribute ~43% to the company's total revenues by 2010.
Opto has recently completed its $70 million acquisition of Criticre Systems (Criticare), a US-based publicly listed company specialising in vital signs and gas monitoring instruments. We estimate the Criticare acquisition to generate incremental earnings of Rs0.60 per share in FY2009E and Rs1.80 per share in FY2010E. We will incorporate the impact of the acquisition after the announcement of Opto's FY2008 results.
We expect Opto's fully diluted earnings (without Critcare) to grow at a CAGR of 35% over FY2007-10E on the back of a 57% CAGR in revenues. We estimate earnings of Rs20.0 per share in FY2009E and Rs29.9 per share in FY2010E.
We have valued the stock using the dividend discount model and the P/E mutiple, arriving at price targets of Rs453 and Rs470 per share respectively. Using the average of the two, we fix our price target at Rs460 per share, an upside of 36% from the current levels.
Opto is trading at attractive valuations of 16.9x FY2009E fully diluted earnings and 11.3x FY2010E fully diluted earnings. Hence, we initiate coverage on Opto with a Buy recommendation and a price target of Rs460. Our current estimates do not incorporate the Criticare acquisition, which could yield incremental earnings of Rs1.8 per share in FY2010E, implying an upside of Rs28-30 per share to our target price.