Saturday, March 9, 2013

ENGINEERING / CAPITAL GOODS STOCKS - A GOOD OPPORTUNITY

Even if it is exhibiting the tendency of cyclical nature,Engineering and Capital goods industry is the back bone of any growing economy . In our country most of the companies operating in this sector is currently facing serious challenges due to lower order book position and delay in execution .Reasons are many like slowness in implementing government  policies,intervention of courts,shortage of power,higher interest rate ..etc ..etc.Even in the past, this industry faces these type hiccups many times and later came out of such bad situations.Most of the listed companies from this space  are long existing in the same industry and the management of such companies already experienced many such ups and downs.Share price of many companies are now ruling at attractive valuations for genuine long term investors.Negative sentiment is surrounding this industry and everyone is in a hurry to dispose even quality stocks from this sector at throw away price, thinking there is no tomorrow .Considering the volatility and panic gripped in the mid/small caps one can't say they will not go down further .But in practical it is very difficult to catch everything at bottom and no meaning in waiting for that .One strategy we can adopt in such a situation is - accumulating small lots of quality stocks in a phased manner and thus keep our average at reasonable level.Such a method will help us to reap the benefits when the industry starts its come back and at the same time avoid the possibility of sleeplessness during testing times.Waiting with patience may be longer but the reward will be equally big.
TRF @ Rs.167,TIL @ Rs.160,InternationalCombustion @ Rs.167 ,Tecpro Systems @ Rs.109 ,CMI FPE @ Rs.475,Eimco Elecon @ Rs.153 ,Ingersoll Rand @ Rs.400 ..etc are some stocks falling in this category. One thing is very important- no meaning in looking at the trading screen from the very next day onwards after the purchasing these stocks .I believe it is the time to become greedy in this sector and not fearful.

106 comments :

  1. i fully agree.whats ur view on hercules hoists.looks good.

    ReplyDelete
  2. Respected VPsir,
    Short of words for prasing you for your E X C E L L E N T pick from
    ENGINEERING / CAPITAL GOODS STOCKS - All the stock you have mentioned are .Worth holding for L O N G E R term , I expect the
    readers too will agree that after purchasing any of these stock and if it falls below their purchase price they should not get WORRIED b'coz these socks have proven track records .
    Kudos for this service ,,,
    Vakharia M J

    ReplyDelete
  3. Dear Valuepick
    Should Tecnofab Engg at 118 be also included in the list.
    Regards
    Suman

    ReplyDelete
  4. Dear VP,

    I'm a great follower of you recomendations.
    I have around 15 stocks suggested by you in my portfolio..

    These days, I don't see search option in your blog..It was very helpful. Could you please make it available

    ReplyDelete
    Replies
    1. There is one search option is still at the top left corner ,using this you can search old postings.Earlier there was another one which included to search the comments too.But unfortunately this option is not working for the past few weeks ,hence I removed it .I think it is an issue of the service provider( Blogger) and I have already send few mails but nothing has happened.

      Delete
  5. dear valuepick
    excellent post.i wud like to know ur view on genus power,voltamp.

    ReplyDelete
    Replies
    1. Voltamp is OK ,not tracking Genus power in recent times.

      Delete
  6. Sir, our old picks Yuken and Veljan Denison should be included or is there any reason for them not being in the list?

    ReplyDelete
  7. Greeting to you Mr. VP,

    I've been following your blog for about a month now and I'm quite happy with your recommendations.

    I wanted to know your views on Elantas Beck India. Is it worth buying at the CMP for a time horizon of 2-3 years?

    I wish you well in all your endeavors.

    Regards,

    Mr. Ganesh

    ReplyDelete
    Replies
    1. As a company I prefer BASF over Elantas Beck for long term.

      Delete
  8. VP sir wat r your thoughts on cummins india...
    Regards,
    Rahul.

    ReplyDelete
  9. Sir previously you suggested Buy on Wim Plast at Rs.200 now the stock has sky rocketed around Rs.350 :) .... Please suggest whether it is good entry point for investment at current level...

    ReplyDelete
    Replies
    1. At CMP it is a HOLD for me.

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    2. Sir,
      thanks for your views....

      Delete
  10. dear value pick,
    i dont know.. how can i express my special thanks to you..bcoz you come to online and spend more time for addressing and checking doubts of general public without any reward... i have been watching and studying stock market since my college time... i have not seen any blog or website like this... thnks a lot sir.....
    whats your view on another beaten down sector real estate... can i purchase small lots of some companies right now...all the companies again trading its 2009 share price.. which stock u prefer to me from real estate and infra sector....

    ReplyDelete
  11. Compared with companies from Engineering/Capital good sector debt burden and unsold inventory is very high for many real estate firms.Many of them having FCCB obligations too .Falling rupee is an issue in that case.Any way one can look into it very selectively .

    ReplyDelete
  12. Dear sir, ABM knowledge is back to ur recommended price. Is it make sense to enter in this counter.Pls advise. Waiting for ur reply. I have posted on ABM many times but did not get any reply. A few words will be of great help.

    ReplyDelete
    Replies
    1. ABM recommended as a BUY @ Rs.45 and book profit @ Rs.90 .Later as a comment I mentioned there is no specific reason to re-enter in it .No change in that opinion

      Delete
  13. Dear VP

    Though out of context here, but what's your opinion on Deccan Gold Mines .. Is it worth taking a risk ?

    ReplyDelete
  14. Sir any advice on optocircuits,everon education,educomp,zylog systems,arshiya internationa; @ current market price

    ReplyDelete
    Replies
    1. Crash in price alone is not a reason for buying any stock ,reason is also important.Recently mentioned about these cos as comments below other posts

      Delete
  15. Sir, is it right time to enter infosys and wipro for investment at current levels ..Thanks

    ReplyDelete
    Replies
    1. Generally not tracking high volume large cap stocks.

      Delete
  16. Hello Sir,

    What do you think about Ballarpur Industries at the current price?

    ReplyDelete
  17. VP Sir ,
    perfect time to go for cap goods....thanks for taking our attention to these wonderful stocks.... plz share your views on Gujarat Gas Company.ltd. is it good company to invest in...

    ReplyDelete
  18. sir;
    can i enter to sequent science at current market price... there is any change your last post regarding scientific

    ReplyDelete
  19. sir your view on jai balaji industries

    ReplyDelete
  20. whats ur view on oriental carbon have 300 shares @130

    ReplyDelete
  21. Dear VP,

    This refers to Span Diagnostics, i am still holding a good quantity with average price of Rs 70 odd. What is your view on this? Please respond.

    Thanks.
    Reply

    ReplyDelete
    Replies
    1. Recommended @ Rs.43 and not @ Rs.70 .Purchase price is an important factor and believe your entry is at higher end.

      Delete
  22. Dear VP Sir,

    Thank you for Great work. Keep it up.....:)

    ReplyDelete
  23. Dear VP Sir

    Does ROTO Pumps also in the category of above stocks? Your views on it.

    Regards

    Keshav

    ReplyDelete
  24. Dear valuepick ji, whats your opinion on BHEL and Bharat electronics
    Thank you
    Senthil

    ReplyDelete
  25. What about easun reyrolle??

    ReplyDelete
    Replies
    1. From the electronic components space prefer Hind.Rect.

      Delete
  26. sir,
    whats ur view on entire oil drilling sector especially aban offshore, shiv vani oil and hoec all companies are now trading their life time low level.

    ReplyDelete
    Replies
    1. Tracking only Selan and Cairn from this sector.

      Delete
  27. vp sir, what is view on swaraj engines?

    ReplyDelete
  28. sir;
    can i enter to ion exchange at current market price... there is any change your last post regarding ion exchange

    ReplyDelete
    Replies
    1. Change is in market mood for mid/small caps.

      Delete
  29. Dear value pick,

    My message on vivimed labs and Ganesha ecosphere is not seen on this blog. Please comment on their prospects.

    Thanks
    Gm

    ReplyDelete
    Replies
    1. Vivimed already recommended as a BUY and requested to book profit.Neutral on it now.Not tracking Ganesha Eco

      Delete
  30. Dear sir,

    Your views on erstwhile posting GPIL at current cmp sir.

    ReplyDelete
  31. Dear ValuePick,

    Any comments about the recent surges of La-Opala? The delivery is very very low.

    KD

    ReplyDelete
    Replies
    1. Its floating stock itself is very low .There may be some speculative interest too in this stock presently.La-opala recommended twice @ Rs.66 and @ Rs.190 which is currently trading around Rs.430 .One may book part profit at CMP.

      Delete
  32. Dear vp sir, hope u fine
    Plz share ur view on gujrat fluro chemicals


    Regardz
    Jasim dubai

    ReplyDelete
    Replies
    1. Jasim,not tracking this stock .Sorry..

      Delete
  33. Dear VP ji markets have been volatile for these year so please suggest us some stocks which are there for conservative investors.... if possible....waiting for ur reply

    ReplyDelete
    Replies
    1. Stocks like Cummins India ,Lupin Lab,Persistent Systems,Biocon.ITC,Tata Chem ..etc are suitable for conservative investors.

      Delete
  34. Hello,

    Nice reading your article. Whats your view on Engineers India Ltd at current levels. Kindly suggest.

    Thanks,
    Justin.

    ReplyDelete
    Replies
    1. Suitable to enter in small lots as mentioned in the above posting

      Delete
  35. Dear VP

    Please share your views on Solar Industries as it is linked to capital goods and other manufacturing activities.

    SD

    ReplyDelete
  36. sir

    do u track gayatri projects?? whats ur view on it after crashing 19% today.cmp 69

    thanks

    ReplyDelete
    Replies
    1. Almost 100% of promoter stake of Gayatri Project is pledged which is not giving comfort.

      Delete
  37. Sir, wanted to follow up on my previous question. Is there a reason you have not included Yuken and Veljan Denison in this list? I've been holding them for long.

    ReplyDelete
  38. VP Ji,
    Please give your views on Electrosteel steels ltd. (ESL)

    ReplyDelete
  39. hi VP,
    What is your opinion on Themis Medicare at such a low CMP? It is just that the company continues its poor run, however you had recommended it before. Any change in views at this time?
    Regards
    Sakharam

    ReplyDelete
    Replies
    1. Company's performance in last quarter was not satisfactory which is the reason for fall in share price.After sharp dip in many mid/small caps we may find other opportunities from pharma space itself to shift from it.

      Delete
  40. Sir, please share your view on Praj Industries.

    ReplyDelete
  41. Sir Yesterday Dr A Bhaskar Krishna sold 8016 shares of granules in market price... No idea why he keep on offloading ..?

    ReplyDelete
    Replies
    1. Reason is unknown ,earlier promoters were buying now a non promoter executive is selling !

      Delete
  42. Sir, What is your opinion on Infinite Computers? All the factors are looking favourable but I want your opinion if you track it.

    ReplyDelete
  43. Sir
    This is regarding a stock you recommended earlier- Basant Agro. Is it still a hold? Or do I exit?

    ReplyDelete
  44. Most of the stocks you have recommended have still very high PE versus the current market trend. I am not sure on what basis you want investors to buy these stocks, when already they are rulling high at PE - 15-20.Even if market becomes better, the appreciation may not be good.

    ReplyDelete
  45. P/E is calculated on the basis of what a company already achieved .But I believe good return in stock market is always depends on what a company can achieve in the future too.

    ReplyDelete
  46. Hi Sir,

    Could you provide ur view on Menon Pistons.

    Ravi

    ReplyDelete
    Replies
    1. Not a bad one from the sector .But go for, it if and only if you are willing to wait till there is revival in auto industry.

      Delete
  47. Sir, what are your recommendation on GUJARAT MINERAL DEVELOPMENT LTD.(GMDC)

    ReplyDelete
  48. Sir, what do you think about Banco Products? How is the management?

    ReplyDelete
    Replies
    1. I don't think there is any specific negatives about this management.

      Delete
  49. Sir, whats your take on PVR and Cera sanitaryware? are they good buy for long term?

    ReplyDelete
  50. Dear Vp,

    I have been reading various articles , TV shows and Other books related share market.. Now I have formulated some rules for screening stocks and FInding a value stocks


    1. P/E < 5
    2. Current price less than half of 52 week high
    3. Debt/Equity < 1
    4. No losses in the last 5 years
    5. P/B < 1

    and My first question is will this formula works ??

    Second question is , I have found few stock on basis of above valuation rule and whats your opninion on Above stocks..?

    List of stock which I found is

    1.Roto pumps

    2.Zylog System

    3.Excel Industries Ltd

    4.Infinite computer

    5.Kavveri Telecom Products Ltd

    6.Thinksoft Global Services Ltd

    7.Hariyana Ship-Breakers Ltd.

    8.Cenlub Industries Ltd.

    9.Narmada Gelatines Ltd.

    Please add your comments with entry price and Exit price if possible..

    ReplyDelete
    Replies
    1. Each and every one can develop own strategies .My prime consideration is for management quality .Suppose you work out all these equations on the basis of the published results .But what we can do if the promoters are fraud enough to publish fabricated result it self ?

      Delete
  51. Hello VP,

    You have recommended some A stocks in 2010 to buy and You have recommended to sell in 2011 and Shall we re enter into the Stock A in 2012 when it was at the same price in 2010?

    Thanks!

    ReplyDelete
    Replies
    1. Fall or rise in price alone is not a reason to buy or sell .Depends on the reason.

      Delete
  52. walchand peoplefirst a small interesting company in a niche sector.do like to know ur opinion on it.

    ReplyDelete
    Replies
    1. Even they are in a space with some potential , are they struggling to scale up business to the next level ?

      Delete
  53. Sir , Whats your view on Multi Commodity Exchange of India at current levels?

    ReplyDelete
  54. sir your view on LUMAXTECH ?
    thank u
    p@w@n

    ReplyDelete
    Replies
    1. Same answer given about Menon Piston ,above.

      Delete
    2. sir thanks for your reply view on tv18 broadcast please

      Delete
  55. sir ur views abt repco home finance ipo.. is it worth investing?

    best regards..

    ReplyDelete
  56. Share your views on crompton greaes and Zylog systems?

    ReplyDelete
    Replies
    1. One may consider crompton for long term in small lots.

      Delete
  57. Sir- Ur view on Shasun pharma please

    ReplyDelete
  58. Dear Sir,

    Thanks for your reply on Menon Pistons.

    Also may i know your view on Jamna Auto Industries and Foseco ( A very good dividend history)

    could you prioritize 1 among menon and jamna for long term...

    Regards
    Ravi

    ReplyDelete
  59. dear vp sir,regards....trf posted a loss this quarterr..do you think that s.i.p should be done in thisstock?thanks

    ReplyDelete

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