Stocks In Focus | DLF, Hero Moto, NBCC, Auto Stocks And More
#StocksInFocus | #BlueOcean Strategic Advisors' Ashish Maheshwari shares insight on stocks to watch. #BQLive
Transcript
00:00 Hello and welcome to BQ Primer. Very good morning to all the viewers. I am Heeral Dadia.
00:07 The markets have been trading under pressure, if you see, in terms of Nifty 50 as well.
00:10 Cuts of over 100 points coming in there and you have Bank Nifty as well. A mild recovery
00:16 that has come in way down almost to 76 points. We started off with cuts of almost little
00:20 over 400 points in terms of Bank Nifty. And you have the Sensex which is hovering little
00:26 around those 66,000 levels. A lot of stock-specific action is what we are witnessing in the broader
00:32 market. But if you see in terms of the large caps, the advanced decline rate show is pretty
00:38 much in favour of the bears. You just have 7 stocks which are advancing in trade today.
00:43 Joining us on the show to discuss stock-specific action is Ashish Maheshwari. Ashish, good
00:48 morning and welcome to the show. Thank you very much. Good morning to you and all the
00:54 viewers. Always a pleasure to speak to you. Ashish, my first question coming to you is
00:59 with A Hero Moto. What's your view with the various negative news that we've been hearing
01:04 with regards to the race as well as the off-sales numbers that have already come in? What's
01:09 your view on A Hero Moto? Yes, if you ask me, slightly numbers were on the disappointing
01:16 side because almost 46,000 vehicles were sold from 4.36 to 3.91 lakh which is not that great
01:28 number. I think if you ask me in terms of what Kajaj Auto and what EVS has reported,
01:36 this was one of the worst performance of A Hero Moto car. But only silver lining is as
01:41 their online booking of Harley Davidson X440 bike is getting closed on 3rd August. So some
01:48 momentum is surely going to be there and that's where premium bike side because we are witnessing
01:54 good premium bike demand compared to regular bikes. But nevertheless, slightly disappointing
02:00 number and whatever the ED related developments are also there in the company will keep upside
02:09 and they stop and check for some time. Right, so that's with regards to where Hero Moto
02:16 as well as the other auto sales numbers go. You have DLF that is in focus as well, you
02:20 have one of the promoters who has gone ahead and uploaded state. What's your view on a
02:24 DLF? I think looking at the market cap size and looking at the kind of shareholding promoter
02:34 on this company in this very miniscule sale, slightly negative but I think the market is
02:40 going to digest this and 700 crore worth of sale is nothing in large cap stock like DLF.
02:47 I think again we need to focus on the numbers in this company and like last quarter numbers
02:53 were pretty good, 12% growth was there in profitability and the kind of new bookings
03:01 are pouring in. I think DLF will be a good stock to buy on any decline. Stock is already
03:08 near 50 but will continue to do well. So my thumbs up for DLF and should be bought at
03:14 any decline. Right, so that's with regards to where DLF goes. Another topic we should
03:22 be discussing is NBCC. Infrastructure has been in focus. What's your view on NBCC? See
03:30 if you see NBCC last quarterly numbers were also good. Their profit went up by 71 crore
03:35 to almost 113 crore and I am expecting last year what they did around 270 crore, they
03:42 will do at least 400 crore of profitability this year because the kind of healthy order
03:48 book NBCC is now having, they will do well. So before result also which is on 10th August,
03:56 this is a good buy. It should be added at 40-43 levels for sure in the portfolio. Right,
04:05 moving on Ashish Tata Chemicals is another one to work out for as well. Clearly, they
04:12 have gone ahead and cut domestic soda ash prices by Rs.1800 per tonne to Rs.30,500 per
04:17 tonne. This will be negative for Tata Chemicals but there could be some beneficiaries too
04:22 out of this. So one is your view on Tata Chemicals and who do you think would be the beneficiaries
04:27 and what investors should do? Yes, we are witnessing a lot of pricing pressure not from
04:33 this month but from the month of April only when this price cut started. If you see last
04:39 year was a dream year for Tata Chemicals, profit went up from Rs.1170 crore to almost
04:45 Rs.2450 crore. So there will be certainly pressure in this year because the new capacity
04:53 addition in Mongolia and they will flood the market with cheaper soda ash globally. So
05:00 they are going to face some pressure in the US market also as well as Indian markets too.
05:04 So it's a sale in my view. I'm not expecting that volumes or price will pick up in Tata
05:12 Chemicals, soda ash which is their bread and butter in the near future.
05:17 Moving on, Thermex reported a set of numbers though they were below what the street was
05:24 estimating. The management when I spoke to them was not really happy with all segments.
05:28 What they said was that they could have done slightly better but the bets are really strong
05:34 going ahead. What would you advise an investor to do with Thermex?
05:39 Thermex I think as far as numbers are concerned,
05:42 profitability was flat because of Rs.51 crore one time hit what company has taken this year
05:49 in this last quarter. But the ray of hope is they are sitting almost on Rs.2500 crore pending order
05:56 book. At the same time, that revenue growth was almost 17% year over year which is encouraging
06:03 in my view. And their end user industries like food, chemical or distilleries all are going for
06:10 expansion. So order will keep on flowing. And even we have seen a stock also performing from
06:17 1800 levels, the stock is now almost 2600 levels. So in my view, again, this is a good capital good
06:25 related story and should be bought at 2500 odd levels. Right. So that's with regards to
06:32 Thermex. You have Bikaji from the FMCG which reported numbers as well. What's your view on
06:38 the consumption space and your call on Bikaji? Yeah, Bikaji is again a direct consumption
06:48 led story and the kind of profitability growth is there. If you see from 18 crore to almost 45
06:55 crore in the year over year is quite encouraging. Even we are witnessing FIIs, DIIs, all are
07:02 increasing the state FIIs have gone from 3.7 to 5.5% in last two quarters. DIIs have also gone
07:09 from 9 to 13%. This shows the kind of confidence investors are having in this company. And very
07:17 good growth in top line is also coming in Bikaji. So this will be surely a stock to
07:24 add in long term portfolio. 460 should be a good level to enter here.
07:28 Metro Brands, the stock is up almost around 5% in trade. And this is again on the back of numbers.
07:35 Clearly, if you go to see in terms of the supply, we see a growth of around 14 to 15%
07:40 that has come in there. Clearly, it's a mixed bag because the profits have declined marginally.
07:48 What would your view be on the Metro? Metro, again, this is a consumption led story,
07:56 number one. And if you see from 105 to 93 crore, there is a slight decline in the
08:02 profitability. But this is on account of Crabtex, which where they have taken a hit. Otherwise,
08:10 there are other brands are doing well. And with Crabtex, now on fold, they will have Fila and
08:16 Proline brands outlet also with them. So this is the reason that in spite of slightly weak quarterly
08:22 numbers, nobody's just selling the stock and the stock is still near 52 week high. I'm quite
08:28 bullish on Metro through the stock because there's not too much competition they are having in the
08:34 kind of brand range what they are offering. And this athletic wear or sport wear market is going
08:44 to grow by leech and bound in coming years. So this is the right time they've entered in this
08:48 product. And it's a buy from my side Metro at around 1050 odd levels that we get.
08:56 Right. Thyrocare has stumbled and trade in the back of a weak first quarter.
09:02 Clearly, you know, the growth slowdown is attributed to a closure of the contract from
09:08 MCGM. What's your view on Thyrocare? Would you advise investors to book profits?
09:14 Or continue to stay invested? Yes, I'll advise to book profit. In my view,
09:20 there's a lot of competition now, which is happening from players like Tata MG or
09:25 Pharma Z, whatever the online apps were there, they have all ventured into
09:29 this business, even Lupin has went into this business. So Thyrocare market leadership position
09:36 will certainly they will lose market because others are going to penetrate and get some market share.
09:42 And we are witnessing also in numbers, though revenue has gone up, which is only solace in this
09:48 quarter for them. But profitability is going to remain under pressure
09:53 in coming quarters also. So it's a sale from my side.
09:56 Right. Apart from that, if you see in terms of your flat cap, as well, I just want to quickly
10:04 look at a few of them. Clearly, there has been pressure that has built in, in few of the names.
10:12 Majority is here, we've spoken about NTPC, Tata Steel, it's the metal packs,
10:17 which has been trading weak. How would you look at the metal counters from here on?
10:22 I'm not that bearish as far as metal is concerned. In my view,
10:29 gradually, they are getting under consolidation. And though there are some issues related to China,
10:39 slowing growth, etc. But I think these are all addressable issues. Second thing is the domestic
10:44 market is pretty strong. It's still a kind of capex is happening in government sector or
10:50 infrastructure and the kind of boom that we are witnessing the real estate in India. This is a
10:55 sector will do well. So here I like a stock like GSW Steel and steel at the same time.
11:04 I'm very bullish on the copper side because copper prices are not up for quite some time.
11:11 And now time has come to look at the copper and the sun copper is my bet in this segment.
11:17 Right. So that's with regards to where overall stock specific action was. Thank you, Ashish,
11:24 so much for joining us on the show and sharing those views. So that's the individual stock
11:29 specific action that we're looking at. But clearly, the pressure does continue on with
11:33 the 500 points coming in terms of Bank Nifty, where we're trading around those 45,100 levels
11:40 and 175 points coming in in terms of Nifty 50 as well. That's all that we have on this session.
11:47 Thanks for watching. And please stay tuned to BQ Prime as lots lined up throughout the day. Thanks.
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