Ambareesh Baliga of Karvy Stock Broking gives his views on four stocks based on Q2 results. He categorises them under hits and misses.
Excerpts from CNBC - TV18's exclusive interview with Ambareesh Baliga:
Let us start with your first hit Dena Bank?
Dena Bank came out with excellent results. We have been positive on Dena Bank, especially for the last 6-9 months and still the results are much better than what we expected. We saw the net profit increasing by nearly 42 per cent. It also reported 27 per cent growth in net interest income and 30 per cent growth in credit.
Infact, we are still looking at an immediate price of nearly Rs 40 and over the next one year, possibly a level of Rs 48 because EPS expectation for the current year is around Rs 6 and for FY08 we are looking at nearly Rs 8.75. So, I think a level of Rs 48-Rs 49 is possible in the next one year or so.
You didn't like Mercator Lines numbers too much, did you?
That's true. Infact, we were positive on Mercator, especially since it was at a level of Rs 27-Rs 28 and that is one of the reasons why it disappointed us a bit, atleast from a standalone point of view. But consolidated results were decent.
On a consolidated basis, we are still expecting Rs 10.7 EPS for the current year, which still makes it the cheapest shipping stock available and looking at their expansion, we still have a price target of closer to around Rs 50-Rs 55 over the next 7-8 months.
You liked Everest Kanto, what are your earnings and price targets on that stock?
In Everest Kanto, we have been positive for a while and the results also were quiet good. We have a price target, which is nearly 35-40 per cent higher than the current levels. We are looking at a price of closer to around Rs 575-Rs 600.
Shringar Cinemas, that is another result that you liked?
In Shringar, the results were good but then the price has moved up quite sharply in the recent past because of rumours of some sort of a takeover, which people are expecting. So although the results were extremely good, I wouldn't suggest buying at these levels because whatever said and done even if it is a takeover, I don't think the price will be much higher than the current market level.
What about Tech Mahindra, EPS has been upgraded but at Rs 900 is there still value left in this?
Infact when it was at Rs 550 sometime back, we had a price target closer to Rs 775 over the next six months, but that was achieved in less than six weeks and currently at these levels, we feel it is slightly overpriced. So unless it drops by another Rs 100-Rs 125, I don't think we can again give a buy call on this
How is participation today? Is it very quiet?
It is quite because most investors are on a holiday, most of the dealers are on a holiday. The participation is lower and the volumes will be quite low today and I really don't expect much fluctuation for the rest of the day.
Disclosures
The stocks, which we have discussed, I don't hold it personally but my clients could be holding some of them.
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