6 Bluechip Stocks Near 52-Week Lows, Should You Buy Them?

Even as the markets continue to exhibit a weakish trend, several stocks have fallen very close to their 52-week lows. Some of these stocks have a long standing track record and sound management. Should you buy some of these stocks?

Sanofi India

Name	52-week low	Distance from 52-week low	Current market price
Sanofi India	6945	0.82%	7000

This is a well managed multinational pharma stock. The dividend yield on the stock itself works to about 2.59%. The p/e on the stock on a trailing basis is about 17 times, which is not very expensive. Sharekhan recently placed a buy call on the stock with a price target of Rs 9000.

Oracle Financial Services

Name	52-week low	Distance from 52-week low	Current market price
Oracle Financial	3239	7.62%	3485

This is a stock that is excellent for its dividend yield which is more than 5%. The price to earnings ratio is also around 16 times one year forward, which is cheap. A good stock to buy.

KEC International

Name	52-week low	Distance from 52-week low	Current market price
KEC International	367	7.68%	396

This is a top company of the RPG group with a strong presence in power transmission and distribution, railways, pipelines, infrastructure, cables etc. The stock is trading at a trailing p/e of 16 times. We believe it is a well managed company and should be a beneficiary in a growing economy.

Kalpataru Power

Name	52-week low	Distance from 52-week low	Current market price
Kalpataru Power	342	6.36%	364

Kalpataru Power Transmission provides end-to-end solution ranging from in-house designs, testing, procurement, fabrication, erection, installing and commissioning of power transmission line. The stock is available at a trailing p/e of just 9 times, with a dividend yield of 2.75%. Probably among the better and cheaper stocks to own.

Gillette India

Name	52-week low	Distance from 52-week low	Current market price
Gillette India	4803	8.92%	5152

This is not a stock that is very cheap. There is absolutely no doubt that the company has a strong presence in its area of business and also a strong brand. However, at Rs 5102, the stock is trading at a p/e of 58 times trailing EPS. We believe that the stock is expensive at the current levels and is best avoided.

Supreme Industries

Name	52-week low	Distance from 52-week low	Current market price
Supreme Industries	1872	4.86%	1963

Supreme Industries Limited is a plastic processing company with seven business divisions. The company has forayed into different types of plastic processing in Injection Moulding, Rotational Moulding (ROTO), Extrusion, Compression Moulding, Blow Moulding etc.

The stock at the current market price is not cheap. In fact, trailing p/e at 27 times is expensive. With input costs slated to go higher, which could put pressure on the margins.

Invest in small quantities

We suggest that investors invest in some of the stocks mentioned in small quantities. The markets are expensive at the current levels and with input costs soaring, we could see margin pressures unfolding. Also, highly leveraged companies would face a problem, given the fact that interest rates are headed higher. Overall, one should invest in small quantities and with caution.