While Nifty for the week has made advancement after two day's of huge gains, there are some stocks that are available at good price post correction and are also good fundamentally. Here are the details on them.
|Stock||52-week high||LTP||Gap from 52-week high|
Vedanta: This is an Anil Agarwal led diversified natural resource company operating across segments such as Copper; Aluminium; Iron Ore; Power; Zinc, Lead and Silver; Oil and Gas, and Others. The company's financials are consistently improving from Rs. 96,386 total revenue in Fy 19 to a revenue of Rs. 1,35,510 crore in Fy22. Also, its net income more than doubled during the period from Rs. 7065 crore in Fy 2019 to Rs. 18,801 crore in Fy22.
Reasonably valued with high dividend yield of over 10%
Coming to its valuations, the scrip looks reasonably valued with a TTM PE of 6.2 as against the sector's PE of 9.03. Also, the company is good and consistent in dividend pay-outs. For the Fy23, the company has announced an interim dividend of Rs. 31.5 per share, for which the record date had been May 9, 2022. This at the current price would mean a dividend yield of 10.01%.
Company's plan on future technologies such as its venture in semiconductors space
Further, the diversified entity is also foraying in future technologies such as semiconductors which will provide a boost to its earnings. In April this year, the company's chairman Anil Agarwal said it will in partnership with Foxconn will come with a semiconductor plan in 2 years time. At the same he iterated that the progress in the semiconductor industry shall augur well for other sectors such as automobiles and electronics in the country.
Vedanta and other miners to benefit from the SC ruling
The apex court in a recent ruling has allowed already extracted iron ore to be exported from Karnataka's 3-districts as per the said conditions. Also, now they would not have to go by the usual e-auction process and instead can head on to sell stocks at various mines in the 3 districts of Karnataka. The move will benefit Vedanta and other miners.
he large cap company from the infra space is another quality stock that has operations across technology, engineering, construction, manufacturing and financial services. The company's all time high and low price are Rs. 2078.55 and Rs. 16.67, implying 1660% gains.
Talking about its financials, though the company's revenues have improved consistently, there is seen a hit in the net income for the Fy22 period. The net income at the concern has fallen from Rs. 11582.93 crore in Fy21 to Rs. 8541 crore.
Decent valuations and healthy order book for Fy23
Valuations wise also the stock looks decently valued when compared to peers. Further, what works in the company's favour is a strong order book and its work towards becoming a debt free entity. Analysts see the company's prospective order book of Rs. 8.53 trillion for Fy23 as a good omen.
Efforts to be a debt free company soon through sale of non-core assets and loss making projects
In exclusive talk with one of the leading dailies, the company's CEO said that 3 projects have been identified for the purpose namely Hyderabad Metro, Nabha Power and L&T Infrastructure Development - with an aim to bring down its ₹40,000-crore debt (excluding that of L&T Financial Services). "L&T's gross debt is ₹1,24,000 crore, but it includes ₹84,000 crore from L&T Finance. So, we have a debt of ₹40,000 crore, which includes ₹13,000 crore of Hyderabad Metro and ₹6,000 crore of Nabha Power. The real debt is only ₹20,000 crore and that too, is for working capital purposes," he said.
The stock for the fiscal year 2021 announced a dividend of 1100% amounting to Rs. 22 per share and this translates to a dividend yield of 1.37%.
While the above 2 stocks are fundamentally strong and are being offered at attractive price post the correction, please do not consider it as an investment call in them. Investors should engage in their own due-diligence before betting on any market linked security.