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Wednesday, January 16, 2008

JK LAKSHMI CEMENT LIMITED : MULTIBAGGER

JK LAKSHMI CEMENT LIMITED has been posting stellar results for the last five quarters in a row. The nine months Cash EPS till December, 2007 stands at 43.21 as against 27.57 for the same period previous year. At current price of 171, this stock is trading at a PE of a mere 3.6!!! The fair value of this stock should be three times the current market price at least. Long term investors can look forward to targets of 500 plus in the next one year. The company has also declared an interim dividend of 10% and record date for that is 30th Jan, 2008. If ever there was an undervalued share in the stock market, this is the one. Must Buy.

23 comments:

hardikpndy said...

is it advisable to wait for it to touch lower levels and then buy? as both (godrej too) are yielding down.

manan said...

Excerpts from CNBC-TV18’s exclusive interview with V Swaminathan:
Q: JK Lakshmi Cements numbers won a hit with you. Does that go down as a miss in this quarter?



A: Yes, I was slightly disappointed with the numbers, though the topline did grow about 23.5%. If one looks at a QoQ basis, the operating margins fell.



If one looks at Q2 FY08 vis-à-vis Q3 FY08, the operating profit margins have come down. That is a cause of worry, especially when one hears that cement prices are holding firm.



This company is one of the lowest priced on a P/E multiple basis among the North Indian cement companies. Going forward, in the second half of the year, I am looking at cement prices softening after July. So, in that case the numbers do look disappointing.

Nishant Varma said...

Dear Superstar , I have been reading your blog and I find it very useful and based on fundamentals ...Especially I liked the call Aurobindo Pharma - one of the stocks I believe will be an outperformer in the future ...I would like to get your view on this Textile company called Sutlej Textiles run by KK Birla Group of Companies...Please advise me on the stock as I hold some good amount on this scrip .
Keep up ur good work ...
Thanks

Lans said...

How long this correction will last!!!

AmoghG said...

Superstar just stumbled upon your messages on MMB today and followed them here... let me tell you your analysis is simply amazing...

Do have a look at XL Telecom and Energy... I think it's bound to touch 1000 within this year... extremely undervalued stock!

Cheers,
Amogh

MANOJ said...

Dear Superstar,

Is it advisable to purchase Appollo Tyres & Asian Electronics at current prices.

Regards,

MANOJ

now_or_never said...

Hi Superstar.......Just by going through the comments in Moneycontrol and here, it's pretty clear that u r a real favorite among the shareholders......I am a newcomer in stock market and simply by going through your messages about cybermate, I bought 1500 shares......My question would be shall I go for 1500-2000 shares of Cat Technology now or shall I go for another 1000-1500 Cybermate shares......Kindly reply,

BR
Rajeev

smjain said...

Hi Superstar,
What do you think is the support level for sensex as daily we are seeing a fall..
I have taken cybermate @18.9 and unichem @204 as per your advice. Pls tell the future target of unichem.

Superstar said...

Hi Hardik,
You can stagger your purchase in both JK Lakshmi Cement and Godrej Ind if you are unsure. Buy in parts.

Hi Manan,
I would not give much importance to the cnbc excerpt you have posted. I have never heard of him.

Hi Nishant,
Thanks for appreciating. I am not too enthused with the Dec qtr results of Sutlej Tex. I would exit and put my money in something with better growth.

Hi Lans,
Read my latest blog on the Current Market Outlook.

Cheers!

Superstar said...

Hi Amogh,
Thanks for appreciating. I think XL Tele is fully valued at current price on current earnings. I am not as optimistic on it as you. According to me it is at best a hold.

Hi Manoj,
Both your stocks are good Holds and can be added on dips.

Hi Now or Never,
Avoid Cat technologies. It does not have good fundamentals like Cybermate Info. Cybermate is any day better than Cat. You can add JK Lakshmi Cement and Godrej Industries in the current market dip. These are good quality companies.

Hi SMJain,
You can continue to hold Unichem Labs and even add on dips. If you hold for long term (12-15 month). Your money can double. I have posted my views on the current market outlook and given the technical levels for the Nifty today itself in a New Post. Read that.

Sandeep said...

Hi Superstar,

What are your views regarding Himalaya INternational. I think it's a great outperformer.

Regards,
Sandeep

Guru bhai said...

hi
can you give me any up date on HFCl i hold 10000 shares.

i need your help guru bahi.

Regards

tejas

Superstar said...

Hi Sandeep,
Himalya Int is a good hold for the long term. It has recently inked a deal with Reliance retail. Hold with stop loss of 22.5.

Hi Guru,
You didn't tell your purchase price of HFCL. Stocks like HFCL are like double edged swords, they cut both ways. It recently ran up from 20 to 60 plus on the back of rumors of FNO inclusion and telecom licence. But now since adverse news has come on both counts, it is going down non stop. I think there might be some support at 38 levels, if even that doesn't hold it might go to 32 next. But I reckon the 38 support should hold.

Cheers!

smjain said...

Hi Superstar,
What is your view on Universal Cables. Is it worth a buy at these levels
Regards
Shashank

ashok kumar said...

I AM HOLDING 22000 SHARES OF JAYSWAL NEECO AT RS. 63/-. WHAT TO DO. I CAN HOLD FOR 6 MONTHS OR MORE. PLEASE GIVE TARGET. IS IT A FUNDAMENTAL STRONG COMPANY OR A MOMENTUM STOCK

REGARDS

ASHOK

Superstar said...

Hi Ashok,
I had recommended a buy on Jayaswal Neco in my initial post when it was at approx. 30 and after it achieved my first target of 80-82, profit booking was clearly advised.
You can hold the stock for some time and you will surely recover your cost price, but for seeing substantial profits from there you may have to hold it for more than a year.

Cheers!

ravindra said...

Hi
Whats your comment on
Praj industries .

Ravindra

kavita said...

Hello Superstar,
I hold the following stocks and would like to get your views on the same:

Eastern Silk,
Diamond Cables,
SKF
TCS.

Also recently I saw on CNBC that there is a lot of interest in Praj and NIIT. Your advise please.

regards
KB

Superstar said...

Hi Ravindra & Kavita,
To get more relevant advice from me you should also mention your cost prices of the stocks which you are asking about.
Praj has been a pioneer in the ethanol business in the past and has always attracted fund manager's attention. It can be held at current price and bought on falls. NIIT has also seen some fund buying from Fidelity. It had given a 1:2 bonus in last June and had a stock split also. So, comparing its numbers is a bit time consuming. Off the cuff, I can say that it can also be held with a target of 150 in the long term.
Eastern Silk is a Hold.
Diamond Cables, I'd book profits in a rally.
SKF is a Hold.
TCS is a Hold.

Cheers!

Superstar said...

Hi SMJain,
I would give Universal cables a miss. It seems fairly valued even after the fall. There are better buys in the market.

Cheers!

kavita said...

Thanks Superstar.
I have also bought ICSA at 550. Currently around 510 levels. I read a report that it is a multibagger with potential of hitting 1800 in the next 2 years. Do you suggest I buy more of it?
Also TCS- I have TCS shares at 850 levels. Should I buy given that it is trading at 16 PE?

manish said...

Hi superstar,

I read your comments abt JK LAKSHMI
pls tell me the targets of this script for dec-08 (I have 60 @ 205)

I have 178 ispat industries @ 77 & NTPC 32@214 pls also let me know these stock future for dec-08.

Lalethaa said...

What is your buying strategy on HCC & Tamilnadu newsprint at the current levels of 95 and 90 resp.?