Research

Share Name: PERSISTENT SYSTEM Sector:IT

Current Rate: 820

Support & Resistance: 750 & 920.

Face Value : 10
Book Value: 277

Market Cap: ₹6516 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Month

Fundamental View:

Expect IP business to be back to normaly.

Management of Persistent Systems Limited (PSL) indicated that the revenue loss in IP
business (higher-than-normal drop of 21% q-o-q in Q4FY2018 versus 2-4% q-o-q drop in Q4 since
FY2010) is expected to recoup during the first three quarters of FY2019E.Management highlighted
that overall revenue from IP products with IBM is expected to grow by 5% y-o-y in FY2019E.Though PSL has already made investments on sales resources (especially in Europe) to drive revenue growth
in IP business.
Digital revenue momentum to continue in FY2019E: PSL’s digital business revenue grew
by 43% y-o-y in FY2018.
There is scope for margin improvement in FY2019 on account of better operational efficiencies such as favourable onsite mix, higher revenue from derivative products, increasing digital business.Further, rupee depreciation (depreciated around 3.7% against USD that also positive for IT sector.FII increased the stake 2.78%.

Board meeting on 27th July for AGM and first quarter result

Short Term view: Positive
Long Term view: Positive

ITC Sector: Heavy Electrical Equipment

Current Rate: 264.40

Target Price : 346 in SIX months and Lower level support 250.

Face Value : 1
Book Value: As on March 2017 :- 47.73

Market Cap: ₹ 319020.27 Cr.

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:

ITC is one of India’s foremost private sector companies with a market capitalisation of nearly US $ 14 billion and a turnover of over US $ 5 billion. ITC is rated among the world’s Best Big Companies has a diversified portfolio in Cigrattes, Hotels, Paper Boards & Speciality Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal care, Stationery, Safety Matches and other FMCG products.

Revenue Data as on March 2018

Cigrattes :- 47.14%
FMCG – 21.55%
Agri Business – 15

Cigratte is the highest revenue generating portfolio of the company, there is a fear of tax increases every year which is affecting the revenue of the company. Even then a 3% growth in the Cigratte business with a double digit EBIT is expected in FY19.

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Regarding FMCG business, the company is diverting its concentration to this area and investing more on the FMCG sector. From packaged foods and life style and confectionery, the company is investing in Diary Sector following the footsteps of Amul. They are planning to spread the business to all over India. This will increase there profits.Paper board business is expected to improve margins given benign input costs, benefits from refurbishment of Décor machine and expected capacity expansion.
Expecting a higher Accounting Rate of Return and occupany rates to improve profitability in the Hotel Sector.
Lower production and high prices of leaf tobacco in India will drag Agri business, despite some relief from INR depreciation.
Taking into consideration of above facts it is recommended to retain “BUY” with sell on target price or Rs.346/-.

News Updates:
(Sector / Scrip related news)

Share Name:L&T Finance Holding Sector: Finance

Current Rate: 161

Support & Resistance : 150/190.

Face Value : 10
Book Value: :- 46.27

Market Cap: ₹ 32600 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:

1.Assets Quality outlook: Wholesale business was remained the major drag on the profitability front due to the high GNPA. Increasing share of high yielding low risky retail credit and increasing PCR against bad loans provides comforts on assets quality front. LTFH is reducing the exposure to stressed sector like power and road and continued to grow in relatively less risky renewables energy segment and structured finance.
2.Provision:To mitigate the future assets quality risk, LTFH is making aggressive provisioning. Provision required for the wholesale business is Rs27-30 bn v/s earlier expectation of Rs22 bn. Company will complete the entire provisioning in FY19.
3.NIM:The company is witnessing healthy financial growth across all the business segments. It has exhibited improvement in NIM (NET INTEREST MARGIN)and fee income and management expects to maintain same growth, going forward.

4.New focus area for company: Refinancing of tractors, scaling up retail and increasing share of direct souring, infra – few new opportunities, increasing B2C fees, and cross-selling in fees

5.Expectation of Rural Business: The company has also maintained a control on asset quality and provisions and expects its rural business to exhibit robust improvement in asset quality in coming years. The company has been showing consistent improvement in cost-to-income ratio.

Short Term view: Positive
Long Term view: Positive

News Updates:
1. During the year, the company recorded one-off income of Rs 1bn from the sale of some PE assets. LTFH still has two PE assets, which are expected to be divested in FY19.

Share Name: BSE LIMITED Sector: Financial services
Current Rate: 860

Support & Resistance: 780/1250.

Face Value : 2
Book Value: 635.37

Market Cap: ₹ 4578.92 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 4 to 6 months

Fundamental View:

1. BSE Ltd is an oldest stock exchange in Asia and currently holds global No.1 ranking in terms of highest number of companies listed, and rank No.10 in world by market capitalisation. BSE is a professionally managed with capable management team with diverse revenue source, management team is trying hard to improve its market share in equity. The company has 13% market share in equity cash while in currency and interest rate derivatives it has 46% and 41% respectively. In emerging segment like Mutual fund business it has 76% market share through its STAR MF platform. With equities as an asset class is getting more acceptances among Indian savers the scope for higher transaction in stock exchanges and mutual fund platform are high. It has strong balance sheet with huge cash and bank balance which implies higher other income will continue in future. Due to surplus cash in balance sheet, the company is doing market buyback of its own shares. Till date company has bought back 16.79 lakh shares at an average price of 815 and has used 82.5% of its earmarked buy back amount. Dividend payout is expected to be good in coming years as capital requirement in future is less. Also BSE has applied for commodity commodity exchange business and likely to start in latter part of current financial year once it gets approval. Currently BSE is trading around 20 times trailing twelve month earnings which appears cheap considering its growth potential and cash in balance sheet. We expect profitability from core business to improve consistently in coming years and advise investors to buy at current market price.

Short Term view: Positive
Long Term view: Positive

Research

Share Name: ERIS LIFESCIENCE Sector:PHARMA

Current Rate: 795

Support & Resistance: 730 & 880.

Face Value : 1
Book Value: 60.72

Market Cap: ₹10606 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Month

Fundamental View:

Eris sales, BEITDA and PAT grew by 16%, 46% and 21% YoY in Q4FY18. The integration of acquired business from Strides and UTH Healthcare helps in the growth of sales. The core business of Eris grew by 10% YoY.

Management expects lower base of FY18 and new sales team with focussed portfolio to reap benefits among the target market.

New brands to target existing network followed by synergy of new geography .management plans to introduce newly acquired brands from Strides (Raricap, Renerve) in its exising network in North and West. Management expects

Renerve brands to reach Rs1,000m in FY19 from current sales of Rs450m in FY18 .

Strong cash flows and lower leverage coupled with high capital return ratios will lead to high PERs for the company.

Company is totaly debt free and Q4 Result also good.

Long Term view: Positive

BHEL Sector: Heavy Electrical Equipment

Current Rate: 83

Target Price : 102 in three months and 141 in six months.

Face Value : 2
Book Value: As on March 2017 :- 131.94

Market Cap: ₹ 32748 Cr.

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:

The stock has bottom lined at Rs.80/- and moved up which suggests reversal of the bearish trend in the scrip. On the daily chart, the stock has gain falling tread line breakout; which again suggests growing optimism in the

stock.

Increasing demand for dairy products is giving and expectation to report net profit of Rs.24.7 crore up 68.2% year -on-year (up 47.8% quarter-on-quarter).

The RSI(14) chart of BHEL shows bullish crossover and rising on the weekly chart.

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Traders can accumulate the stock in the range of Rs.83-90 for the target of Rs.102/- and a stop loss below Rs.78/-..

News Updates:
(Sector / Scrip related news)

Share Name: M&M Financial Services Ltd. Sector: Finance

Current Rate: 473

Support & Resistance : 450/520.

Face Value : 2
Book Value: As on March 2017 :- 129

Market Cap: ₹ 29244 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:

1. Strong Q4 results better than expectation.
2. Loan to farm equipment sector, like Tractor sales increasing (20% in FY18) is positive for the company and 35% of business has exchange program on tractor, while 65% customers are new to industry.
3. Normal monsoon prediction is also advantage for the company.
4. MMFS has been improving its presence across Pan‐India states. MMFS concentrating more in Rural market than Urban. Overall portfolio has seen decent growth in April on track with expectations. New branches should add

more to growth.
5. Steady growth in customer addition
6. Steady product mix is advantage for the company
7. AUM growth is good compared to last quarters

Short Term view: Positive
Long Term view: Positive
News Updates:
1. The business environment for MMFS is getting better

Share Name: M & M LTD Sector: Automobile
Current Rate: 870

Support & Resistance: 980/810.

Face Value : 5
Book Value: As on March 2017 :- 239.53

Market Cap: ₹ 111340.32 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 2 to 3 months

Fundamental View:

1. 1. Mahindra & Mahindra Ltd (M&M) is a multinational car manufacturing company in india, and one of the largest vehicle manufacturer by production in India, and the largest tractor manufacturer. The company reported

a strong 50% year on year growth in consolidated net net profit at Rs. 11.55 Billion in March 2018 quarter(Q4FY18). It had profit of Rs7.7 billion in the same quarter last fiscal. The company’s total revenue rose by 24% to Rs 133.55

billion during Q4FY18, compared to Rs, 17.95 billion in the last year ago period, boosted by strong sales across tractors and utility vehicles, the domestic automotive volume for the company grew 20% while the domestic tractor grew

44% over the previous year quarter. We can see that a good sales growth for the coming quarters..

Short Term view: Positive
Long Term view: Positive

Research

MINDTREE Sector: IT

Current Rate: 992

Support & Resistance: 950 & 1060.

Face Value : ₹ 10
Book Value: 192

Market Cap: ₹16 ,295

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Months

Fundamental View:

Mindtree posted robust revenue growth and in-line profitability. Revenue came at USD 226mn, 5.5% QoQ led by digital (45% of rev) growth at 8.3% QoQ.

Management has guided for higher revenue growth/margins in FY19 as compared to FY18. We reiterate our positive outlook on Mindtree based on (1) Strong deal pipeline and deal wins (>60% increase in pipeline and higher win-rate in transformational deals), (2) Strong outlook in top account (9.6% CQGR in last 4-qtrs), (3) Continuity in digital traction (highest YoY growth in last six qtrs) with industry leading digital mix, (4) Recovery in BFSI vertical and top 2 to 10 accounts (26% of rev) ahead, supported by ramp-up of prior deal wins.

Mindtree to add 1,900 freshers in FY19 and currently 27% of employees in 0 to 3 years exp. Band is a debt free company.

HERITAGE FOODS LTD.

Current Rate: 697

Target Price : 795.

Face Value : 5
Book Value: As on March 2017 :- 156.86

Market Cap: ₹ 3289 Cr.

Recommendation: BUY (BUY / SELL)

Holding Period: 6 Month

Fundamental View:

Heritage Foods is a Fast Moving Consumers Good company engaged in dairy, Retail, Agriculture, Bakery and Renewable Energy. Its principal products/services are milk, value added products and FMCG (food and non-food). The dairy segment mainly deals with procuring milk, processing and selling of milk, value added products, fat products, skimmed milk powder, tradable goods and job work. The retail segment mainly deals with buying and selling of FMCG – Food, FMCG – Non Food and fruits and vegetables. The agriculture segment mainly deals with procuring, processing and selling of fruits and vegetables, tradable goods and job works. The bakery segment mainly deals with procurement, production and selling of bakery products. The Renewable Energy segment mainly deals with generating and supply of solar power and wind power to the diary segment for its captive consumption. It has operations across approximately 10 states in India.

Increasing demand for dairy products is giving and expectation to report net profit of Rs.24.7 crore up 68.2% year -on-year (up 47.8% quarter-on-quarter).

Net sales are expected to increase by 11.5% Y-O-Y (up 34.9% Q-O-Q) to Rs.780.8 Crore. Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 41.8% Y-OY (up 38% Q-O-Q) to Rs.48 Crores.

The expectation of good monsoon prediction by the Metrological Dept. and increasing demand for FMCG products the company is expecting good revenue growth for the company in the next quarter.

Looking at the above conditions , it is a good buy of Heritage Foods at the CMP with a target of Rs.795/- in six months time.

News Updates:
(Sector / Scrip related news)

YES Bank Ltd. Sector: Banking

Current Rate: 346

Support & Resistance : 330/375.

Face Value : 2
Book Value: As on March 2017 :- 114

Market Cap: ₹ 80718 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:
Strong performance in a challenging quarter
1. Yes Bank reported robust growth for the Q4 with better than expected margin.
2. Net stressed loans as of 4QFY18 at 1.73% of total advances (Dec 17 : 2.41% of the advances).
3. Yes bank added 50 branches during the quarter to 1100.
4. Recommended Payment of dividend of Rs. 2.70 per share.
5. Loan & Deposits doubled Y2Y is positive for the bank.
6. Well managed asset Quality is another positve.
Short Term view: Positive
Long Term view: Positive
News Updates:
1. Asset quality performance so far has been significantly better than industry;
bank expect this trend to continue.
2. YESBK has been growing at a much faster clip than the industry’s growth rate.

GREAVES COTTON LTD Sector:MACHINERY
Current Rate: 137

Support & Resistance: 110/170..

Face Value : 2
Book Value: 46.01

Market Cap: ₹ 3,379.82 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 2 to 3 months

Fundamental View:

1Greaves Cotton Limited manufactures and sells engines and engine application product in India, the Middle East, Africa, and South-east Asia. It offers lightweight diesel/gasoline engines for automotive engines applications, such as three- wheelers and small four-wheeled commercial vehicles and engines for portable agricultural pumpsets, gensets, small boats, construction equipments and other applications. The company also provides engines for various applications in marine, agricultural equipment, fire fighting pumpsets, mining and construction, material handling, rail cars, road sweepers, etc. In addition, it offers diesel generating sets and trades power tillers, spares related to engines, construction equipments/infrastructure equipments etc.

Short Term view: Positive

Long Term view: Positive

Research – 15th May 2018

HCL TECH Sector: IT

Current Rate: 930

Support & Resistance: 870 & 1070.

Face Value : 2
Book Value: 299

Market Cap: ₹1,29,882

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Month

Fundamental View:

HCL Technologies (HCLT) reported revenue growth of 2.5% QoQ in USD terms in 4QFY18
in FY2018: HCL Tech reported largely in-line revenue performance with 1.2% q-o-q growth.

FY19 revenue growth guidance of 10.5% to 12.5% in US$ this figure only negative exceptation was 12% to 14%.
HCLT already has 26 clients with revenue run-rate of US$10 mn+ contributing to ~49% of revenue from Mode-2 solutions. In FY18, it had 40+ notable wins in existing and new clients for Mode-2 solutions.
Good quality company basis long term financial performance.
At the current stock price and financial performance the stock has Attractive valuation.
Recent developments
HCL Tech signed 15 transformational deals in Q4FY2018 against 20 deals in Q3FY2018 across verticals.

HERITAGE FOODS LTD.

Current Rate: 697

Target Price : 795.

Face Value : 5
Book Value: As on March 2017 :- 156.86

Market Cap: ₹ 3289 Cr.

Recommendation: BUY (BUY / SELL)

Holding Period: 6 Month

Fundamental View:

Heritage Foods is a Fast Moving Consumers Good company engaged in dairy, Retail, Agriculture, Bakery and Renewable Energy. Its principal products/services are milk, value added products and FMCG (food and non-food). The dairy segment mainly deals with procuring milk, processing and selling of milk, value added products, fat products, skimmed milk powder, tradable goods and job work. The retail segment mainly deals with buying and selling of FMCG – Food, FMCG – Non Food and fruits and vegetables. The agriculture segment mainly deals with procuring, processing and selling of fruits and vegetables, tradable goods and job works. The bakery segment mainly deals with procurement, production and selling of bakery products. The Renewable Energy segment mainly deals with generating and supply of solar power and wind power to the diary segment for its captive consumption. It has operations across approximately 10 states in India.

Increasing demand for dairy products is giving and expectation to report net profit of Rs.24.7 crore up 68.2% year -on-year (up 47.8% quarter-on-quarter).

Net sales are expected to increase by 11.5% Y-O-Y (up 34.9% Q-O-Q) to Rs.780.8 Crore. Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 41.8% Y-OY (up 38% Q-O-Q) to Rs.48 Crores.

The expectation of good monsoon prediction by the Metrological Dept. and increasing demand for FMCG products the company is expecting good revenue growth for the company in the next quarter.

Looking at the above conditions , it is a good buy of Heritage Foods at the CMP with a target of Rs.795/- in six months time.

News Updates:
(Sector / Scrip related news)

YES Bank Ltd. Sector: Banking

Current Rate: 346

Support & Resistance : 330/375.

Face Value : 2
Book Value: As on March 2017 :- 114

Market Cap: ₹ 80718 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:
Strong performance in a challenging quarter
1. Yes Bank reported robust growth for the Q4 with better than expected margin.
2. Net stressed loans as of 4QFY18 at 1.73% of total advances (Dec 17 : 2.41% of the advances).
3. Yes bank added 50 branches during the quarter to 1100.
4. Recommended Payment of dividend of Rs. 2.70 per share.
5. Loan & Deposits doubled Y2Y is positive for the bank.
6. Well managed asset Quality is another positve.
Short Term view: Positive
Long Term view: Positive
News Updates:
1. Asset quality performance so far has been significantly better than industry;
bank expect this trend to continue.
2. YESBK has been growing at a much faster clip than the industry’s growth rate.

LARSEN TOUBRO LTD Sector:CONSTRUCTION AND ENGINEERING

Current Rate: 1370

Support & Resistance: 1480.

Face Value : 2
Book Value: As on March 2017 :- 391.57

Market Cap: ₹ 1,94,452 Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 2 to 3 months

Fundamental View:

1. L& T has entered in to a definitive agreement with Schneider Electric (India) Pvt Ltd. And Schneider Electric JV Holdings Limited for a divestment of its electrical and automation (E&A) segment for a cash consideration of INR140b. The deal does not include the marine switch gear and Servo watch Systems in the E&A segment. The deal is expected to close in 18 months from the date of signing of the agreement and is subjected to the required regulatory approvals. The E&A segment accounted for 4 – 5 % of consolidated sales in FY18. The E&A segment is a debt free business with strong cash flow generation.

Research – 30th April 2018

SRIPIPES Sector: STEEL

Current Rate: 370

Target Price : 430.

Face Value : 10
Book Value: As on March 2017 :- 20450

Market Cap: ₹ 1,727.61. Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 2 to 3 Month

Fundamental View:

Srikalahasti Pipes is one of the leading manufacturer of DI pipes with backward integration. Ductile pipe have high tensile strength, flexible and leak tight joints, corrosion resistant, longer service life and are mainly used for portable water and sewerage transportation. The company have good infrastructure which includes own railway siding to transport iron ore, leased plot at krishnapatnam port to accommodate coal import, water arrangement with tirupati municipal corporation to utilize sewerage water, long term lease limestone mines and own material handling facilities. With government focus on drinking water, the future prospects are bright for the company. Last year the company has expanded capacity of DI pipe from 2.25 TPA to 3 TPA. We expect company to show steady growth in coming years on higher orders from Government. Trust areas can consider Srikalahasti Pipes for decent gains.

BLUE STAR LTD

Current Rate: 793

Target Price : 850.

Face Value : 2
Book Value: As on March 2017 :- 96.03

Market Cap: ₹ 7450 Cr.

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Month

Fundamental View:

Blue Star Ltd. is one of the largest Consumer Durable company in India with an annual revenue of Rs.4,400 Crores. It has wide range of products – Room Air Conditioners, water purifiers, air purifiers, air coolers, water coolers, central air conditioning, commercial refrigeration, cold storages and speciality products – mortuary chambers and hot water generators. The company has introduced 100 new models of various ACs, including 40 models equipped with energy efficient invertor technology to meet the demand for summer and thereby increase there revenue in AC segment with a target of Rs.1700 crores in 2018-19 from Rs.1500 in 2017-18. Another factor which the company expects is the trade war between China and US. As China is producing ACs with low cost will affect there production if the trade dispute continous. This will help the consumer durable industry in India to increase exports. These factors will help increase the market share of the company from 11.5% to 12.5%.
This year the company is planning to invest Rs.85 crores on new product development, research and design and advertising and brand promotion. It is also planning to add 50 exclusive stores this fiscal, taking the total exclusive stores count to 200.

The growing demand for room airconditioners in the Indian and world market and the trade war between Us and China, Bluestar is expecting a revenue growth of 19% during 2018-20 and margins to improve from 5.8% in FY2017 to 6.6% in FY2019.

Looking at the above valuation it is good to buy Blue Star at the CMP of Rs.793 with a target of Rs.850/- in three months.

GNFC Sector: Fertilizers

Current Rate: 454

Support & Resistance : 430/500.

Face Value : 10
Book Value: As on March 2017 :- 295.40

Market Cap: ₹ 7068Cr

Recommendation: BUY (BUY / SELL)

Holding Period: 3 to 6 Month

Fundamental View:
1. Good Q4 results announced – 38% rise in profit, declares 75% dividend (Rs. 7.5 Per share)
2. Companies best ever performance in its 42 years history.

Short Term view: Positive
Long Term view: Positive
News Updates:
1. Positive monsoon prediction will help the company for coming days performance.

TAKE SOLUTION Sector:IT

Current Rate: 219

Support & Resistance: 204 & 240.

Face Value : 1
Book Value: As on March 2017 :- 75.58

Market Cap: ₹ 2926

Recommendation: BUY (BUY / SELL)

Holding Period: 3 Month

Fundamental View:

TAKE Solutions is a leading international business technology company with products backed by a strong domain expertise to provide cost–effective comprehensive solutions for businesses. With over 500 current employees, TAKE Solutions global headquarters are in Chennai, India with North American headquarters in Princeton, NJ.
TAKE specializes in Regulated Information Management Systems (RIMS) and Clinical Data Management Services. TAKE utilizes the Universal Drug Development Model (UDDM) for integration of data elements, application and business rules applied within the clinical drug development systems.

TAKE Solutions staffs major technology centers and sales offices in Chennai, Malaysia, Mumbai, Oman, Philadelphia, and Research Triangle Park, NC, and Austin, TX. TAKE Solutions is SEI–CMMI Level 5 Certified, Microsoft Gold Certified, and is a Registered CDISC Solution Provider. TAKE conducts business today in 9 countries with more than 150 FORTUNE 1000 customers.

TAKE Solutions has achieved Microsoft Gold Partner Certification for the past ten years.

Recent developments.

Take Solutions has signed a major deal with the leading South Korean Pharma major, Yang Pharm Co Ltd.