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Friday, September 19, 2014

NCC in talks to sell road project
E Sudhir Reddy,  CMD, IVRCL Ltd
Photo: Stock Explain
Hyderabad, September 19, 2014: With the investor sentiment improving in the country, city-based construction company NCC Ltd is talks to exit one of its four BOT road projects and expects to clinch a deal by the end of this year.“We are planning to exit two out of four BoT road projects. Out of two, we are currently in talks with potential buyers for one project and a deal could happen by the end of this fiscal,” said NCC executive vice-president (finance) Y.D. Murthy here.

The two road projects that the company is planning to exit are Western UP Tollways and Bangalore Elevated Expressway. 

After years of high growth, the Indian construction companies are scrambling to sell their BOT projects as high interest costs and low efficiency of their projects threaten to push parent companies towards severe financial strain.

NCC is not the only construction company that plans to exit its BOT road projects. 

IVRCL had said that it has put all its BOT projects on the block, Ramky Infra is also in talks to exit its road projects. GMR Infra, meanwhile, has terminated its contract to build around Rs.6,000 crore road project.

Apart from the monetisation of its road projects, NCC is going to pare debt from the proceeds of its upcoming rights issue. “We are launching our rights issue, which will open on September 29 and close October 17,” he said. Post rights issue, the company’s standalone debt will come down to Rs.2,000 crore from the current Rs.2,600 crore as the construction major looks at trimming its interest costs. 

Courtesy: Deccan Chronicle

Thursday, September 18, 2014

Winning Strokes: Think Different
PVP Ventures Ltd (Rs.9.62) recommended around Rs.8.25 and then again at around Rs.6.50, made a new 52-week High (adjusted) of Rs.11.59 on 12/09/2014. I hope most of you have made money from this call. 
Yesterday, IVRCL Ltd was recommended as a fresh buy at around Rs.17.90, the scrip today touched Rs.18.90, before cooling down at Rs.18.60. The government of India is expected to ease norms for FDI in the construction sector--IVRCL Ltd (Rs.18.60), HCC Ltd (Rs.36.15), Punj Lloyd Ltd (Rs.40.55), etc. could be some of the biggest beneficiaries. Meanwhile, according to the Indian Express, 10 September, 2014: 
A  year after starting the tendering process for the Colaba-Bandra-Seepz Metro, billed to be the country’s longest underground Metro rail corridor, the Mumbai Metro Rail Corporation (MMRC) has now finalised a list of nine consortia eligible for financial bidding after scrutinising pre-qualification tenders. Intending to finalise contracts and start work by the year-end, the MMRC will issue Requests for Proposals (RFP) to the nine pre-qualified firms in the next few days. A total of 14 consortia had submitted pre-qualification bids for the Colaba-Bandra-Seepz Metro. The nine consortia declared eligible are AFCONS Infrastructure Ltd-Kyivmetrobud, DOGUS-SOMA, CEC-ITD Cementation India-Tata Projects Ltd, IL&FS Engineering and Construction-China Railway 25th Bureau Group, J Kumar Infraprojects-China Railway Engineering Group Co, Larsen & Toubro-Shanghai Tunnel Engineering Company, OSJC Moscow Metrostroy-Hindustan Construction Company, Pratibha Industries-Guandong Yuantian Engineering and Unity Infraprojects Ltd-IVRCL Ltd-China Railway Tunnel Group.
Today Kolte-Patil Developers Ltd was recommended to the Paid Groups around Rs.190-193. The scrip today closed flat at Rs.189.80.
Today, Oswal Greentech Ltd (Bindal Agro) touched Rs.34.35, before closing at Rs.33.45. The scrip today moved up with good volume. The real estate and investment related scrips are expected to shine in the coming days, due to obvious reasons. Moreover, the name of the company Oswal Chemicals & Fertilizers Limited did not match the activities of the company. Therefore, the company had changed the name of the company to “OSWAL GREENTECH LIMITED”. The changed name of the company was confirmed and recorded by the Registrar of the Company, Punjab w.e.f. 23rd November 2011.
Western India Shipyard Ltd today moved by more than 6% and closed at Rs.1.89. The company is likely to get benefited from the commencement of mining in Goa. Once the mining starts in Goa, then the whole of mining and shipping sectors, would get tremendous sentimental boost. 
I have already said this a number of times earlier in various platforms, and is again reiterating: The shares from the Indian Auto sector are highly overvalued (Industry P/E is more than 248) according to my estimates, but still most of them are rising, SURPRISINGLY. It reminds me of DOTCOM CRASH in 1999-2000, when also the IT sector valuations were thought to be invincible; before everything crumbled like NINE PINS. 
Yesterday,  HDIL was recommended at Rs.86.25, to the Premium Service members. The scrip today touched Rs.93.90 Intra-day, before closing at Rs.93.40, up 9.24%.

Wednesday, September 17, 2014

OSWAL GREENTECH LTD (Formerly Oswal Chemicals & Fertilizers Ltd): Update
CMP: Rs.32.50
  • Management has decided to convert land and building, Plant and Machinery and Furniture and Fixtures owned by the companyat Tilak Marg of Rs.11,676.43 Lacs (Rs.116.76 Cr) held as inventory into fixed assets and the same is being used for official purposes.
  • The company has incurred an expense of Rs.4040.50 Lacs (PY Rs.4,040.50 Lacs) on the development of commercial cum residential project at Chembur land at Mumbai (Bombay) pursuant to agreement with Oswal Agro Mills Limited (OAML). In accordance with the agreement, OAML has to contribute its land and the company is required to incur all development expenses of the project with the understanding to share the ownership of the Chembur project in an agreed ratio. The construction/development of the project was stayed by the Hon’ble Supreme Court of India vide order dated 10.12.2013 stating that the same land can be used for the purpose of Agro Industry or any other permissible industry under the current regulations. The management is exploring the possibilities to use the land in question as per the permissible regulations and accordingly is of the view that the amount spent on the project will be fully recovered from the future projects.
  • Oswal Chemicals & Fertilizers Limited (BINDAL AGRO, CMP: Rs.33.35) will have Annual General Meeting on 18 September, 2014. During the year FY14, the Company carried on the activities related to development of Real Estate and Investments. The company is taking up three projects in Ludhiana for development of about 15,00,000 sq.ft. of built up area. The Company expects good demand of residential apartments in this ever growing city. The company has also earned interest income from the funds which are temporarily invested in various financial institutions/securities/fixed deposits. At present, the company is operating in the business of Real Estate, Investment activities, Fertilizer and trading in shares/commodities/Goods as separate Business Segments. According to the management. relative absence of large number of organized players in the Real Estate business segment provides an excellent opportunity to the company, to become a leading player in this industry. The management has extensive experience in setting up large industrial projects in a timely manner and this experience can be leveraged to build a strong and sizable presence in the real estate business. 
  • The business segment is the primary segment of the Company consisting of: (i) Investment Activities (ii) Trading Goods and (iii) Real Estate
  • Aggregate Market Value of Quoted Investments==> Rs.6,743.03 lakhs.
  • Aggregate Cost of Quoted Investments ==>Rs.2,444.33 lakhs.
  • Aggregate Cost of Un-quoted Investments==>Rs.6,571 lakhs (Rs.4071.88 lakhs).
  • Aggregate provision for diminution in value of Investments Rs.1,418.72 lakhs (Rs.1,403.72 lakhs).

Monday, September 15, 2014

Oswal Chemicals & Fertilizers Limited: Buy
CMP: Rs.35.35

The company is presently known as Oswal Greentech Ltd (NSE Code: BINDALAGRO). At present, the company is operating in the business of Real Estate, Investment activities, Fertilizer and Trading in shares/ commodities/ Goods as separate Business Segments.

The sudden fall in the profitability was due to stoppage of work under the joint development agreement with M/s. Oswal Agro Mills Ltd. for the development of land at Chembur, Mumbai for residential and commercial complexes, as per the order of Hon’ble High Court of Mumbai. 

As the project at Chembur, Mumbai was shelved indefinitely till the decision on the petition of M/s. Oswal Agro Mills Ltd. before the Hon’ble Supreme Court of India is received. The company is informed that the hearing in the case by Hon’ble Supreme Court of India is completed and the judgment is expected soon. The company is seriously considering diversification in the field of power, energy and natural resources and is under discussion with experts of respective fields. The future outlook in the case of Real Estate looks encouraging.

Aruna Oswal of Oswal Chemicals and Fertilizers Ltd last month announced the launch of a health care project for rural women in and around Ludhiana. She said the programme would be conducted by a able team of the Mohan Dai Oswal Cancer Hospital. The family is already running educational institutions to provide education to the underprivileged sections of society. Chief minister Parkash Singh Badal asked Aruna to give a detailed project report so that the state government could join them in this venture. He also requested her to come up with more projects for the state.

Net profit of Oswal Green Tech declined 39.46% to R.10.05 crore in the quarter ended June 2014 as against Rs.16.60 crore during the previous quarter ended June 2013. Sales reported to Rs.0.92 crore in the quarter ended June 2014. There were no Sales reported during the previous quarter ended June 2013.

Oswal Green Tech is holding 14.17% stake in NDTV Ltd (Rs.109.80). The share price of NDTV Ltd hit 20% upper circuits today.  

Oswal Green Tech Ltd, the Delhi-based chemicals and fertilisers company, acquired 14.1% stake in television broadcasting major NDTV Ltd for about Rs.24 crore through open market transactions in 2011. Through bulk deal transactions on the National Stock Exchange, Oswal Green Tech purchased a total of 91,36,894 shares of NDTV at a price of Rs.26.64 a piece, which appreciated by more than 4 (four) times during the last few years. 

Oswal Greentech Limited mainly develops and promotes residential and commercial real estate properties in India. It is also involved in the trading of shares/commodities/goods; and investment activities. The company was formerly known as Oswal Chemicals & Fertilizers Limited and changed its name to Oswal Greentech Limited in November 2011. Oswal Greentech Limited was incorporated in 1981 and is based in New Delhi, India.