Low P/BV Ratio, good fundamentals and growth oriented stocks in future -
1. Nectar Lifesciences - Pharma Sector
The company is into producing oral & sterile bulk drugs in the antibiotic segment and supplies to major top pharma companies.
CMP = Rs 36.5
PE = 8.85
EPS = 4.1
Book value = 19.91
Price to book value = 2.07
Expected returns = 70% to 80%
Duration = 2 to 3 years
2. Ramco Industries - Construction Materials
The company is part of South based Ramco group of companies. The company is into building products, textile division and wind mills.
CMP = Rs 69.45
PE = 11.17
EPS = 6.18
Book value = 32.02
Price to book value = 2.19
Expected returns = 70% to 80%
Duration = 2 to 3 years
3. Essel propack - Containers & Packaging
The company is part of Essel group. The company is the second largest manufacturer of laminated tubes in the world.
CMP = Rs 47.3
PE = 22.6
EPS = 2.09
Book value = 37.32
Price to book value = 1.54
Expected returns = 70% to 80%
Duration = 2 to 3 years
Recovery in next 2 to 3 years
4. Alok Industries - Textile Sector
The company is in textile segment. It operates in the 4 special business units - international, infrastructure, garments and domestic retail businesses.
CMP = Rs 20.15
PE = 6.54
EPS = 3.08
Book value = 35.47
Price to book value = 0.70
Expected returns = 60% to 70%
Duration = 2 to 3 years
5. Electrosteel Castings - Construction & Engineering
The company is a water infrastructure company providing solutions in the areas of water supply and sewerage systems for the construction & management of water resources.
CMP = Rs 50.05
PE = 7.94
EPS = 6.31
Book value = 38.72
Price to book value = 1.36
Expected returns = 60% to 70%
Duration = 2 to 3 years
The following companies are having good fundamentals and in long term in next 2 to 3 years they will provide good returns.
Note - As markets are trading at higher levels some profit booking may not be ruled out so investors can buy in steps and keep averaging as the stock prices keep coming down.
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Researched date - 2nd week of January 2010
Revised date - 26 July 2010
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