CNI DIWALI PICKS 2021

TOP CLASS UNDERVALUED STOCKS

BSE Ltd - CMP 1315; Market Cap ₹ 5907 Crs

It is in monopoly biz. There are only 16 exchanges in the world and only 10 are efficient. 2 are in India. BSE is the lowest valued stock at just 37 p e It trades at 600 mn $ ex CDSL whereas globally exchanges trade at 95 to 51 bn $. BSE has multiple faced such as  26 pc stake in CDSL, trading gold and silver, rising d mat nos ,  FDI approval and possibility of foreign partner. Hundred time better than IRCTC valued at 250 P E.

ACCELYA Ltd - CMP 1310; Market cap ₹ 1961 Crs

This I T co is unique as it provides solutions to global aircraft manufacturers like Boeing and also specializes in cost reduction solutions for airlines carriers’ biz. Absolutely monopoly business globally.

OCCL Ltd – CMP 1080 ; Market cap ₹ 1077 Crs

Expanded capacities. Commercial production will start in Nov 2021. Post this it will be 2nd largest co in the world.

CENTUM ELECTRONIC Ltd – CMP 523; Market cap ₹ 673 Crs 

One of the best  I T co. Web security is the biggest play and CENTUM is leader.

TATA MOTORS Ltd – CMP 500 ; Market cap ₹ 1,65,517

E v biz valued at ₹68000 Crs,Tata technology 73 pc holding at ₹40000 Crs makes and non e v and LCV biz valued for the rest which is very cheap. It is absolute leader in E V. It has true ally in Tata power to provide e v battery charging support and will be able to get Tata gr support which will start chip production in next 12 months. Tata hired Intel man for this. Tata Motors announced to invest ₹15000 Crs in EV which is almost 22 pc of the E V valuation.    

TATA POWER Ltd – CMP 225 ; Market cap ₹ 72000

Emerging as the biggest power solution co. Making strong head room in solar and renewable energy. Biggest e v charging platform.  India will be power surplus and if that has to happen Tata Power will be playing biggest role. Case of value unlocking from subsidiaries.

SAIL Ltd – CMP 117; Market cap ₹ 48384

In ore as good as Tisco and in capacity as good as JSW. Almost debt free. Divestment candidate. Fair price ₹ 250-280. Currently trading at less 25% of JSW market cap and street is expecting JSW to double so SAIL could be a surprise bet. L N MITTAL or few others will be keen to acquire this co.

NMDC Ltd – CMP 141; Market cap ₹ 41189

One of the biggest iron ore producer. 124 mn tons capacity is huge as against 31 mn tons a year back. Its new mines are of 62 f e which as good as Australian ore. Steel plant is worth Rs 23000 Crs. This is only co where ore biz is available at 2 p e.

ITC Ltd – CMP 234 ; Market cap ₹ 288172

This is a MNC co which has failed to deliver for the last 5 years. However, post-merger of its AGRI biz r it ison high growth path. Cigarette demand is inelastic hence any efforts to bring attempts to put breaks on prices will not work. ITC has become FMCG and Agro Company. ITC will deliver in next 2 years what they did not, in last 5 years. There is chance of de merger which enhance value of investors. BAT may pitch for control sooner than later.

TATA INVESTMENTS Ltd – CMP 1569 ; Market cap ₹7940

This Tata gr co not only hold major Tata Gr co shares but also holds many other listed co shares like Infosys. Market cap of the co is less than ₹ 8000 Crs whereas the discounted (50% ) value for holding co plus 100% of other investments is as high as ₹16000 Crs which clearly point to 100% upside in the stock.

STEADY BETS

TINPLATE  Ltd – CMP 305 ; Market cap ₹3197

A growingTata group co. Demand for tin plates is rising as packaging demand is in rampage.  Co has been reporting consistent good set of nos. There could be big surprise ahead as recent research shows that tin is the strongest and cheapest source oflithiumbattery for the E V. Application of TIN, as and when forced, in system this co will be in different gambit.

VIPUL ORGANICS Ltd – CMP 180 ; Market cap ₹171

Rapidly expanding specialtychemical biz. Already capacity rose 600% and further expansions underway.Co announced acquisition of more land for expansion. Seems there are no boundaries in the biz.   90 % biz is exports to 56 countries.  Highly technical biz where 54 shades 1 color has to be produced with 100% accuracy in each and every batch. Entry barrier biz. High margins. Only 2 co's can be counted as genuine and true pigment co. Sudarshan and Vipul. Rest are in dyes which is just a commodity.

HERCULES HOIST Ltd – CMP 140 ; Market cap ₹448

Bajaj Gr co. Into HME segment which is rapidly growing. Small equity and high growth in ibitda. Perfect pitch for steady bet. Stock under accumulation. Ready for big innings.

HIND COPPER Ltd – CMP 133 ; Market cap ₹12885

Divestment candidate. Grossly underpriced. Capacity expansion at full swing. Fair value is ₹600+ based on copper deposit in the mines.

SUNIL AGRO food Ltd – CMP 114 ; Market cap ₹34.20

High Equity to sales ratio in food biz. Promoter holding as high as 73 % capacity expanded 300% Will definitely report huge rise in revenue.

INTEGRA ENG India  Ltd – CMP 72 ; Market cap ₹247

Swiss MNC. Railway is a hot sector. This co only one to cater LED signaling. Modernization of railways has major role in signaling. Small equity high ibitda nos.

RVNL Ltd – CMP 37 ; Market cap ₹7714

On Equity of ₹2000 crs, co has ₹16000 Crs top-line. 38 projects under execution. New projects under pipeline. Just available at 7pe as against 250 of IRCTC. Growing at 40 pc CAGR. Blue chip PSU stock.

PRAVEG COMMUNICATIONS Ltd – CMP 120 ; Market cap ₹ 60.7

Manages the RANN of KUCHHH and STATUE of UNITY. New season started with bang. Also into infra, real estate. Again a co at just 8 P E.  High growth at low price. Could be a winner due to capability to manage high Govt projects.

PROBABLE MULTI BAGGERES

MK EXIM Ltd – CMP 89 ; Market cap ₹ 80

At just 80 Crs market cap competing with ₹80000 Crs NYKAA. Enjoy 5 years exclusive distribution rights of 3 Americanco's in women's cosmetic brands. Lakme is one of the salon using M K brands. Co have 5500 salon clients and trying to expand rapidly. Good financial position. Going cheap.

GLOBAL OFFSHORE Ltd – CMP 47 ; Market cap ₹115

Only co in this kind of PSV/AHTV supplying to rigs used in the process of oil exploration. Break even rate is 8000 $ a day whereas very soon will see co getting 21000 to 25000 $ a day. Singapore based shipping broker opined that charter rates will scale up plus 30000$ a day and will sustain for at least next 36 months. The young fleet is as good as owned by Shell, British petroleum,BourbounetcCo claims the assets value is ₹600 Crs and in next 12 months will become debt free. A must in shipping armor.

AMD INDUSTRIES Ltd – CMP 37 ; Market cap ₹70

Serving the likes of Coco cola,PepsiCo, Unilever,Hind Food and many more this technocrat owned co is a perfect suit in the packaging play. They manufacture caps and crowns of plastic and glass bottles. For 60 odd crs market cap co has impressive revenue of Rs 200 Crs with ibitda of Rs 30 32 Crs. Could be winner in this decade. Promoters raised 4 % stake this year and may open fresh buying as early as APRIL 22.

AANCHAL ISPAT Ltd – CMP 10.5 ; Market cap ₹21

Another metal revival story with its brand RELICON TMT bar being supplied to defense. Co came of NCLT successfully.  For this small co the revenue number of ₹160 Crs are quite impressive. These number are better than newly listed PARAS Defense trading at ₹ 3000 4000 Crs market cap.  Can be a probable multi bagger with low risk as co has managed to swipe debt which means the account is standard and will remain so.  Co successfully came out of NCLT as disclosed in the Balance Sheet.

HCC Ltd – CMP 10 ; Market cap ₹1491

AjitGulabchand group flagship co made plan for debt restructuring. ₹20000 Crs order book not a single default in execution. Post debt spin off to a new co, it has reported superb number in Q 1. Expecting big hair cut from lenders. Getting a size at throw away price. Could be multi bagger if hold patiently. Massive experience in execution of large projects including METRO.

Coffee day Ltd – CMP 38 ; Market cap ₹801

After the death of Siddhartha, this co is for revival. Though they have been closing many stores there vending machines are intact and many biggies have shown interest. They also have 4 fine hospitality properties operating currently which exceed in value more than the current market cap. 2 events point that this could be a multi bagger. 1 that 1.2 cr shares of KKR got absorbed easily at  ₹ 29-30.  Second co made statement that they are ready for revival andwaiting lenders proposal.

TTML Ltd – CMP 53 ; Market cap ₹10,250

Tata Teleservices Maharashtra has strengthened its portfolio of enterprise grade solutions and partnered with Zoom Video Communications to offer world-class unified communication solutions to enterprises. Last week, it launched a smart internet leased line. Tata Sons holds 75% stake in the co. and going by its recent initiatives, it seems it has big plans for this co. They have launched 5 new digital products. High probability of seeing Tata Digital merger.

Ideal portfolio...

50 % in top class

30% in steady bets

20% in probable multi baggers.

If this ratio is maintained we see investors getting 100 % annualized average return over next 5 years. At least 2 stocks out of probable multi baggers could be 30 to 50x. This will help only if you have all 7 shares in equal proportion and hold it for 5 years.

Our past recommendations.

• Cera Sanitation
• Ineosstyrolution
• Wimplast
• Zydus Wellness
• Galaxy Surfactant
• Action Construction
• GPIL
• Polycab
• Hikal
• Vidhi Specialty
• Vip
• Sheela Foam
• Amar Raja Batteries
• Zensar
• VST Tillers
• 17) Oriental Aromatics
• 18) Ceat
• 19) SandurManganese
• 20) Tata power
• 21) Tata Motors
• 22) Tisco
• 23) Tata Coffee
• 24)Tata Elxsi
• 25)Tinplate

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