Markets are trading just 5 per cent away from their peak levels and hence there is very little value that one can find. However, we have recommended a few stocks that may still be able to make some money and are great stock picks in India for 2018.
Here are a few of these which have the potential to give returns.
South Indian Bank
South Indian Bank has performed reasonably well despite the difficulty most banks are facing with regards to non performing assets.
The bank saw some marginal deterioration in its asset quality, though it is well under control when compared to other banks in the country, especially the PSU banks and some larger private players like ICICI Bank.
The bank reported a net profit of Rs 114 crores for the quarter ending March 31, 2018, as against Rs 115 crores reported in the previous quarter. The gross non performing assets moved marginally higher to 3.59 per cent for the quarter ending March 31, 2018 from 3.40 per cent in the previous quarter ending Dec 31, 2017.
The bank reported an Earnings Per Share (EPS) of Rs 0.63 for the period. We believe that South Indian Bank can maintain the same momentum going forward, which should take the EPS to Rs 2.4 in 2018-19. At Rs 24, the stock is barely trading at 10 times price to earnings multiple. Also, the shares are available at a dividend of Rs 0.40 per share.
The stock is not a bad bet from a long term holding time frame of 2-3 years. Check stock quote of South Indian Bank
Balrampur Chini Mills
Shares in Balrampur Chini Mills have fallen from levels of Rs 170 to the current levels of Rs 74. The problem right now for sugar companies is that sugar prices have come crashing down.
This is likely to impact the performance of companies like Balrampur Chini Mills. However, the company has some hedge in the form of its distellery unit and saleable power co-generation capacity of 163.20 megawatts.
The Company's 10 factories in Uttar Pradesh possess an aggregate cane crushing capacity of 76,500 tonnes per day. The company has managed to reduce its interest costs over the years, which is a big positive.
In fact, the company has no major capex in pipeline Long term debt as on Sept 30, 17 stood at Rs 161.9 crore. Repaid Rs 43 crore during Sept 2017 period. Long-term Debt-Equity ratio stood at 0.10 as on Sept 30, 2017.
At some stage, sugar prices should rally as demand and supply maintain an equilibrum. A good stock to buy for the long-term in India.
P C Jeweller
This stock has crashed from levels of Rs 600 to Rs 156. The reasons for the stock crash is the huge selling pressure by institutional investors.
Initially, there were reports of Vakrangee having bought huge quantities and reports of worries of manipulations. However, Vakrangee has clarified that this was treasury operations. Following this there were reports that the main promoter had gifted a stake in the company to a relative.
Later a news channel reported of CBI raids at the premises of the company, which was also denied through a notice to the exchanges. PC Jeweller could be an interesting pick for a number of reasons. First, there is a buyback of shares, at a price of Rs 350. Interestingly, the promoters have said they would not participate in the buyback, which means retail shareholders can tender even more.
This means the share could yield significant returns on this basis alone, given that the offer price could be three times the current market price of Rs 156.
Apart from this the stock is also available at a p/e of just 10 times one year forward earnings, making it a good pick at the current levels.
Also read: Best small cap stocks to buy
Hindustan Media Ventures
Hindustan Media Ventures is one of the leading print media companies engaged in the country, which prints and circulates ‘Hindustan', the second largest newspaper daily in India based on total readership.
The company also publishes two Hindi magazines ‘Nandan' and ‘Kadambin'.
'Hindustan' is the No 1 newspaper in Bihar, Jharkhand and Uttarakhand, while it is the No 2 in Delhi and Uttar Pradesh.
The stock is one of the fundamentally most undervalued stock, which is one of the reasons to be recommending to buy the stock. In fact, the share price of the company is now at Rs 214, which is very close to its 52-week low of Rs 210.
Hindustan Media: Reasonable performance
The near term strategies of HMVL include better cover price realisation, better monetization of copies through higher yield and a focus on augmenting volumes.
For the quarter ending March 31, 2018, the company reported an income from operations to Rs 228 crores. Net profits at the company rose to Rs 40.32 crores from Rs 39 crores, in the previous quarter.
The EPS of the company for the quarter was Rs 5.49. HMVL may end the year 2018-19 with an EPS of Rs 24, making the stock available at a p/e of just 8 times.
This is not bad for a media company which has solid cash on its books and has leadership status in key markets.
With election in large states round the corner and central government elections in the next one year or so, advertisement spends are likely to increase benefiting the company immensely.
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