CPT V24P7-Art1 (Content).pmd - Taxmann
CPT V24P7-Art1 (Content).pmd - Taxmann CPT V24P7-Art1 (Content).pmd - Taxmann
STOCK MARKET 712 YOUR QUERIES Please share the prospects of Hercules Hoists Ltd. and also whether its shares can be held for the longer term? What target of company should I keep in my mind for this purpose? Hercules Hoists Limited is engaged in the manufacture and sale of material handling equipments and spare parts in India. The company offers chain pulley blocks, chain and wire rope electric hoists, ratchet lever hoists, winches, roll-out racks, light profile Stock Corner ARUN K. MUKHERJEE Investment Consultant systems, pulling and lifting machines, H.O.T./E.O.T./Jib cranes, floor operated stacker cranes and stores stacker cranes. It also markets shrouded conductors and profile crane systems and generates power through 4 windmills with an installed capacity of 1.25 megawatt in each wind-mill in Maharashtra. The company supplies its products to various industries, such as iron and steel, cement, oil and gas, chemicals, construction, material handling equipment manufacturers, State electricity boards, power plants, petro-chemicals, mining, pharmaceutical, logistics and general engineering industries, as well as to turn-key solution providers. It’s one of the finest companies which I have been tracking for the past 5-6 years. It’s one of the coolest Bajaj group companies with more than decent prospects. The company is expected to go forwards with its sales and profits expected to grow at 30% CAGR for the next 3 years. Some months back the company shifted to the Khopoli area and has the capacity to do ` 300 crore of turnover. The company previously used to cater to the domestic August 1 to 15, 2012 u TAXMANN’S CORPORATE PROFESSIONALS TODAY u Vol. 24 u 92
equirements but of late has received loads of enquiries from the export world too. It’s still a tiny company with 100 odd crore sales. So, increasing demand for its products can do wonders for the company. Quoting now at ` 126 it is a solid long-term player. It’s a debt free entity with huge intrinsic value (has 2 acres of prime land in Mulund). The company should be a 1000 crore marketcap company in the next 3 years from the present 400 crore net worth company. Now that certainly makes a good bet for you to go in for its shares. I have shortlisted a penny stock company called Aadhaar Ventures. Should I go in for the 1 ` counter Company’s stocks? What caught my eye in this scrip is the amazing movement it has witnessed over the last 3 years. From a level of 1.65 ` in March 2009 it went all the way to 87 ` in March 2011 - an amazing gain of 50 times in just a matter of couple of years. Marketcap vaulted to 1785 crores from 30 crores. Things changed drastically post July 2011 when the counter nosedived to a level of as low as ` 1 and it’s still quoting at the same price. ‘An operator’s special’ should be the proper words to chant here. Its sales jumped from 8 crores in 2006 to 265 crores in 2011, whereas its net profit remained at a meagre of 1crore. Who knows, maybe again it can fly to abnormal levels. An operator’s activities are still to be kept under scanner, no matter how bad or good its environment be. No shortcuts for becoming rich, you see. In my teens, I loved a novel called ‘Reminiscences of a stock operator’ by American author, Edwin Lefevre (which is the thinly disguised biography of Jesse Lauriston Livermore. The Wall Street Journal described the book as a ‘classic’. It was ranked at 15 on ‘Fortune’s 75. The Smartest Books We Know, and Alan Greenspan said it is ‘a font of investing wisdom’). Go through the book before buying the scrip! COMPANY UPDATE - JAI BALAJI INDUSTRIES The company is one of the well known steel manufacturing groups in Eastern India with diversified product range which includes pig iron, sponge iron, TMT bars, ferro-alloys, alloy bars, etc. With rising raw material prices and increased volatility, it plans to use its coal assets to increase raw material integration. The company holds varying stakes in four coal blocks, viz., Dumri and Rohne in Jharkhand and Andal and Jagannathpur in West Bengal. The promoters of Jai Balaji have been on a buying spree pocketing over 2 lakh shares from the open market in the last couple of months. This indicates that the worst is over for the counter and at the present juncture there’s nothing much to loose. Long-term trends show that companies in which promoters and related entities have bought shares on sharp declines have done well when the market came under the control of the bulls. Jai Balaji which was recommended a few months ago has so far been an inferior performer; thanks to its debt and not so encouraging numbers. But with its coke oven plant getting operational any day now, coupled with a rise in its margins, should see its stocks delivering much better numbers and going forward. August 1 to 15, 2012 u TAXMANN’S CORPORATE PROFESSIONALS TODAY u Vol. 24 u 93 713
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STOCK MARKET<br />
712<br />
YOUR QUERIES<br />
Please share the prospects of Hercules Hoists Ltd. and also<br />
whether its shares can be held for the longer term? What target<br />
of company should I keep in my mind for this purpose?<br />
Hercules Hoists Limited is engaged in the manufacture and sale<br />
of material handling equipments and spare parts in India. The<br />
company offers chain pulley blocks, chain and wire rope electric<br />
hoists, ratchet lever hoists, winches, roll-out racks, light profile<br />
Stock Corner<br />
ARUN K. MUKHERJEE<br />
Investment Consultant<br />
systems, pulling and lifting machines, H.O.T./E.O.T./Jib cranes, floor operated stacker cranes<br />
and stores stacker cranes. It also markets shrouded conductors and profile crane systems<br />
and generates power through 4 windmills with an installed capacity of 1.25 megawatt in<br />
each wind-mill in Maharashtra. The company supplies its products to various industries,<br />
such as iron and steel, cement, oil and gas, chemicals, construction, material handling<br />
equipment manufacturers, State electricity boards, power plants, petro-chemicals, mining,<br />
pharmaceutical, logistics and general engineering industries, as well as to turn-key solution<br />
providers. It’s one of the finest companies which I have been tracking for the past 5-6 years.<br />
It’s one of the coolest Bajaj group companies with more than decent prospects. The company<br />
is expected to go forwards with its sales and profits expected to grow at 30% CAGR for<br />
the next 3 years. Some months back the company shifted to the Khopoli area and has the<br />
capacity to do ` 300 crore of turnover. The company previously used to cater to the domestic<br />
August 1 to 15, 2012 u TAXMANN’S CORPORATE PROFESSIONALS TODAY u Vol. 24 u 92
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