Jitendra Kumar Gupta's blog

http://www.business-standard.com/india/news/textile-stocks-stitch-realty-gains/405578/ The recent real estate deals in Mumbai by National Textile Corporation (NTC) as well as moves by some textile companies to develop their surplus land have evoked a strong market response. Stock prices of these textile companies have risen sharply in the recent past on expectations of value unlocking from the vast land that they acquired at historically low costs. The enthusiastic response from investors is not surprising, given that NTC’s recent auction of Bharat Mills and Poddar Mills has valued the land at an average Rs 190 crore an acre, which is significantly higher than was expected. Notably, these textile companies have also seen an improvement in the performance of their core business of textiles, which has added to the gains. Here are a few prominent names in this sector which own considerable land banks and have plans to monetise them: Arvind Led by higher capacity, expansion of r...

http://www.cnbc.com/id/15840232/?video=1575080742&play=1 CNBC Video whether the chances of a double-dip recession have reached perilous levels in the United States, with Nouriel Roubini, RGE chairman & founder.

What if a company is paid for carrying out its day-to-day business at no extra cost? It may sound absurd, but that is the case with a few Indian companies. Out of the total BSE 200 companies, 23 have negative working capital — their current liabilities or payables are higher than current assets or receivables. This essentially means the companies do not have to deploy their own capital or borrow from banks to carry out their routine business activities. “It is actually very good to have negative working capital because this entitles companies to earn relatively better returns on capital and equity. This also shows the operational efficiency of a company. But just this would not be enough. The companies should also have good fundamentals,” says Jeetay Investments Director Chetan Parikh. Such companies are preferred by investors as they reward shareholders relatively better. The BSE 200 companies have an average returns on capital and shareholders’ funds at about 20 per cent, which is fa...

Prakash Steelage, which is into manufacturing and trading stainless steel welded and seamless pipes, has come out with an initial public offer (IPO) of Rs 63-69 crore to fund expansion plans and working capital needs. The company manufactures several products of stainless steel pipes, which find application in major industries, including power, oil & gas, chemical, pharmaceuticals and automobile. It generates about 15 per cent of its revenue from exports, which it intends to increase after the expansion. Improving prospects The company is the second-largest player in the organised stainless steel pipe industry, which is about half the total size of the industry. At present, the per capita consumption of stainless steel is low in India at about 1.2 kg compared to six kg in China. This figure is even higher in other developed countries. However, consumption is growing, led by the ongoing investments in user industries as well as new applications of stainless steel consi...

This interview was published in July 2008, but most of his lines are fresh and teach us about how the individual investors should approach the market equity valuations. Among the best known experts on valuations with several books on the topic to his credit, Aswath Damodaran is a professor of finance and the David Margolis Teaching Fellow at the Stern School of Business at New York University. Damodaran’s major works on equities include Investment Valuation, The Dark Side of Valuation and Damodaran on Valuation while books on corporate finance are Corporate Finance: Theory and Practice and Applied Corporate Finance: A User’s Manual . in an interview with Jitendra Kumar Gupta , Damodaran talks about the Indian economy, stock picking and factors investors need to watch out for before committing their money to the markets. Do you believe that India’s long term growth story remains intact? Yes, but with one caveat. The long-term growth story was never as rosy as it was made out to be...

IVRCL Infrastructure, a leading player in the construction space with projects spanning segments like water, irrigation and road, posted disappointing results for the June quarter during market hours on Tuesday. While sales fell by a marginal 0.2 per cent due to delays in three major projects, net profit was down 21 per cent. Not surprisingly, the stock fell 10.3 per cent over two days and closed with a small gain of 1.3 per cent on Thursday. Execution concerns Its Rs 75-crore NATRiP projects and the Tankage project in Madhya Pradesh were delayed due to the release and approval of project designs. Additionally, a slowdown in execution as a result of delays in payments for its projects in Andhra Pradesh (AP) have contributed to flat growth in revenue in the quarter. Operating margins may have improved marginally but, as other income dropped 77 per cent and interest outgo surged 17.6 per cent to Rs 45.29 crore, the company reported a 21 per cent fall in the net profit. Strong visibility ...

http://www.business-standard.com/india/news/value-boosters-for-portfolio/404291/ While broader market valuations are not cheap, many stocks are available at attractive prices and are capable of giving good returns. In the current market conditions, where valuations are not cheap and investment opportunities fewer, market pundits believe a selective approach could pay good dividends. For, quite a few stocks, especially of smaller companies, are still available at fairly good valuations, despite healthy growth prospects. “At current levels (price to earnings of about 18 times), the markets are trading at an upper band of its valuations. This is why investors need to be selective, pick stocks where valuations are yet to catch up with earnings, which are going to be higher,” says Harendra Kumar, head of institutions, equities & global research at Elara Capital. A recent IIFL report indicates that consensus earnings have seen a downgrade for large caps, whereas mid-caps have seen an upg...

After a flattish trend in capital expenditure over two years, India Inc is set to see a sizeable jump in investments towards creating new capacities. According to the Centre for Monitoring Indian Economy's (CMIE's) Capex database, new project announcements for the quarter ended June stood at Rs 5.8 lakh crore - 66 per cent higher than the average fresh investment of Rs 3.5 lakh crore per quarter in the preceding four quarters. "This is a good indication that investments continue to soar and corporate confidence is very strong. There is strong recovery in the industrial capex and electricity, which accounts for almost a third of total investments," says CMIE MD & CEO Mahesh Vyas. HOW THEY STACK UP In Rs Crore CMP (Rs) PE (x) Order book OB/ Sales ABB 803 71.6 8,500 ...