Saturday, 26 July 2014

Samkrg Pistons & Rings: Best stock in ancillary segment; Buy

- This company is regular dividend paying company since its inception. The company has declared 25% dividend for FY14. Company may declare Rs.235crore turnover and Rs.13.75crore profit in FY15 & may declare Rs.275crore turnover and Rs.16.8crore profit in FY16.

- As its current market price, the share price discounts less than 7.3 times its FY15 (E) EPS of Rs.14& the share price discounts less than 6 times its FY16 (E) EPS of Rs.16.90, which is highly cheaper against its peers.

- The stock appears undervalued and is likely to attract value buying at this level. Investors can buy this stock with a stop loss of Rs.85 on a closing basis.

- On the upper side, it willzoom to Rs.140 level in medium term and Rs.175+ in next 9---12 months.FIIs & DIIs are highly bullish on Auto Ancillary Sector & Frontline Auto Ancillary stocks are trading @ PE ratio of 20 to 60 while this small cap stocks are available at PE ratio of just 7.

- While it has paid fantastic results in past so it may again pay big dividend in future. So it may be best stock in auto ancillary segment.

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