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Various popular stock market news portals and TV channels discuss trending stocks and provide free share market tips based on technical charts and often without in-depth research. Our research desk analyses these trending stock market tips and provides their 360-degree analysis in a single place so you can avoid making wrong decisions with your hard earned money. Here are the share market tips for holding duration of around six months.

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Share Market Tips For May 2019: 4th Week

JSW Energy Ltd (NSE: JSWENERGY) (Share Price: Rs.67.60 ): Potential Buy

Valuation:Over-Valued stock with TTM PE of 18x.

Reasons to Consider: JSW Energy has posted surprisingly positive result in Q4 and logs Rs 6 cr profit as against Rs 483 cr loss in the year-ago. Company has also decided not to pursue the electric vehicle business because of the higher than anticipated uncertainties associated with it. Rather, it would maintain capital cushion for growth opportunities in power and other related businesses which street see as a positive for the company going forward. During the quarter the PLF(Plant Load Factor) was at 54% as against 51.9% in the corresponding quarter of the previous year.

Key Drivers: Company has continued de-risking the business with significant portion of open capacity tied-up with under short-term power supply contract in FY20 in which a) Vijayanagar plant secured PPA for 330 MW from Telangana state for period of 9M which begins from July 19, b) Open capacity at Ratnagiri plant nearly fully tied up in H1FY20 through short term contract, c) Commissioning of 36 MW thermal capacity at salboni and nandyal expected in Q1FY20 along with long term PPA tied up under group captive scheme. It is also focusing on strengthing the balance sheet in which during the quarter it has reduced the net debts of Rs 636 cr with net debt to equity ratio stood at 0.85x. Going forward the key to watch will be the PLF on various power plant and the tariff on merchant rates with the ability to sign the long-term PPA with Discoms.

Financial: Company had reported a Revenue of Rs 2018 cr in Q4FY19 Vs Rs 1879 cr in Q4FY18 up 8%, posted Net Profit of Rs 6 cr in Q4FY19 vs Rs 483 cr loss in Q4FY18.

UltraTech Cement Ltd (NSE: ULTRACEM ) (Share Price: Rs.4470 ): Potential Buy

Valuation: Over-Valued stock with TTM P/E of 65x.

Reasons to Consider: UltraTech Cements revenues for Q4FY19 grew 16.6% Rs 10,500 cr almost entirely led by volume growth. Volume growth strong at 16% for the quarter. Volume sales clocked during the quarter were at 20.46 MT whereas realisations remained flat YoY at Rs 5134/t. The strong operational performance drove the margin expansion with production costs per tonne reducing from Rs 4138/t to Rs 4050/t. For FY19, the cement industry would have been expected to grow at 12%, with all four quarters growing at double digits. During the year, the industry witnessed incremental demand of 38 MT being higher than the incremental supply of 12 MT.

Key Drivers: The addition of Binanis assets to its portfolio, the companys gross debt has soared above Rs 20,000 crore. The management now intends to divert operating cash flows towards debt repayment. Additionally, UltraTech is in the process of selling its non-core assets in the UAE and China, which will help achieve debt/EBITDA of 1.7x by FY21E. The assets acquired from Jaypee Associates (21.2MT) are operating at 82% capacity utilisation level. The company intends to make these assets earnings accretive by the end of FY20E. Binanis assets, which had undergone overhauling during the quarter, operated at 72% utilisation for March 2019. The commendable ability of the management to turn around key acquired assets remains a key strength for the company as is being witnessed in the current quarters performance. We expect a similar performance to continue even in the newly acquired Century assets. After achieving greater scale, the focus now turns to de-leveraging to strengthen the balance-sheet which will be a key positive trigger for the stock.

Financial: Total revenue Rs 10500 cr in Q4FY19 vs Rs 9002 cr in Q4FY18 up 16%. Net Profit at Rs. 1017 cr in Q4FY19 vs Rs 488 cr in Q4FY18 up 108%. Ebitdastands at Rs.2213 cr in Q4FY19 up 30% vs Rs. 1703 cr in Q4FY18.

Bajaj Finance Ltd (NSE: BAJFINANCE ) (Share Price: Rs.3280 ): Potential Buy

Valuation: Over-Valued stock with TTM P/BV of 11.5x.

Reasons to Consider: Bajaj Finance has yet again reported stellar quarter with 57% jump in its consolidated net profit at Rs 1,176 crore in Q4 on the back of fall in provisions. However, it loan losses and provisions declined to Rs 409 crore from Rs 454 crore, QoQ with provision coverage ratio was unchanged at 60 but company asset quality improves with growth in lending business. Company has improved its loan book as without compromising its asset quality compare to its other peers also the company has also continued to manage its ALM/Cost of Funds (COF).

Key Drivers: Men to be separated from boys as the NBFC segment is undergoing a significant shift in market approach. Courtesy to recent events such as defaults (and subsequent bankruptcy in several cases) of the debt paper of several toprated corporates, we find that risk tolerance and appetite have been tempered across money markets. We believe this may lead to a possible shift in market approach, giving more importance to ratings and quality of borrower rather than merely chasing yields. Company has yet again posted robust performance in a tough environment as against other NBFCs. It has seen strong loan growth during Q4, where its assets book grew strong 41 percent YoY to Rs 1,16,000 crore. Management has always guided a loan growth rate of 20-25 percent but it has been consistently beating the guidance. BFLs margins improved in Q4 due its strong asset quality so that it can raise money at lower yield. Gross non-performing assets (NPAs) and net NPAs stood at 1.54 per cent and 0.63 per cent, respectively, at the end of March 2019. BFL always traded at premium valuations due to its higher earnings growth trajectory. Currently, BFL stock is trading at FY20 estimated P/B ratio of 7.5 which is significant premium to its peers.

Financial: Net interest income stood at Rs 3395 cr in Q4FY19 vs Rs 2265 cr in Q4FY18. Whereas, AUM grews to Rs 116000 cr in Q4FY19 up 41% with Steady asset quality. Net profit up 57% to Rs 1176 cr Vs Rs 748 cr YoY.

PHOENIX MILLS(NSE: PHOENIXLTD ) (Share Price: Rs.610 ): Potential Buy

Valuation: Fairly-Valued stock with TTM PE of 25x.

Reasons to Consider: Company has posted robust performance on revenue and profit front up 65 & 120% during the quarter despite slowdown in the real estate sector due to liquidity crunch. The Company is engaged in the development and operation of malls and other real estate properties. The company has an operational asset portfolio of eight operational retail assets aggregating 5.9 million square feet (MSF) and four operational commercial assets aggregating 1.16 million square feet.

Key Drivers: Focusing on completing its existing/upcoming projects by FY22/23 and de-leveraging its balance sheet will be a key driver for growth. Phoenix has two under construction assets at Pune, Chennai with GLA of 1.12 MSF and plans to develop commercial asset at PMC Hebbal with GLA of 0.65 msf. Phoenix Mills Ltd provides a unique way to play Indias real-estate & retail growth story. It will be the prefer bet in the real-estate sector due to its strong operational performance, scalability (through the CPPIB deal), robust cash generation and no issue in corporate governance.

Financial: Total revenue Rs 723 cr in Q4FY19 vs Rs 436 cr in Q4FY18 up 65%. Net Profit at Rs. 228 cr in Q4FY19 vs Rs 104 cr in Q4FY18 up 120%. Ebitda stands at Rs.410 cr in Q4FY19 up 78% vs Rs. 230 cr in Q4FY18.

Share Market Tips For May 2019: 2nd Week

Indian Hotels Company Ltd (NSE: INDHOTEL) (Share Price: Rs.147 ): Potential Buy

Valuation:Over-Valued stock with TTM PE of 60x.

Reasons to Consider: Indian Hotels reported mixed bag numbers for the quarter. Consolidated revenues grew 8.8% YoY to Rs 1,244 crore. Average occupancy for Q4FY19 was at 74%, a 200 bps dip YoY led by the addition of new properties during the quarter. However, the financial year ended with an occupancy of 68% for the company, implying a 100 bps increase in occupancy rates. As demand has grown at a rate higher than supply, the industry saw RevPAR growth of 3.7%, simultaneously IHCL also seen a growth of 6 % YoY in domestic hotels while the same for international network grew 9.3% YoY in FY19. Also, IHCLs international portfolio has shown signs of a turnaround, which will provide a cushion going forward.

Key Drivers: Asset light focus continues with leverage ratios to improve in the coming quarter with Indian hotel portfolio in FY18 comprised 32% of rooms under management contracts whereas it ended FY19 with 40% of rooms under management contracts. Revenues from management contracts for FY19 were at Rs 222 crore. Further, in FY20E, 1800-2000 new keys would be added, mostly via management contracts. Thus, we believe the asset-light nature of management contracts and their increasing share in the hotels' portfolio of IHCL, should enhance EBITDA levels, thereby leading to an improvement in net debt/EBITDA ratio. Considering the expected tailwinds in the hospitality sector as a whole fuelled by steady demand, lower supply addition and higher discretionary spends, IHCL being one of the leaders in the sector should be a key beneficiary of the turnaround. Additionally, the focus on cost rationalization is expected to drive margins further.

Financial: Company had reported a Revenue of Rs 1244 cr in Q4FY19 Vs Rs 1144 cr in Q4FY18 up 8.8%, Net Profit up 62% to Rs 122.6 cr in Q4FY19 vs Rs 75.6 cr in Q4FY18, whereas EBITDA stands at Rs 284 cr in Q4FY19 vs Rs 245 cr in Q4FY18 up 16%.

Tata Chemicals Ltd (NSE: TATACHEM ) (Share Price: Rs.588 ): Potential Buy

Valuation: Over-Valued stock with TTM PE of 15x.

Reasons to Consider: Tata Chemical showed signs of revival across geographies, except Europe. EBITDA/MT increased 43% YoY to USD53.3 in North America (realization up 5% YoY to USD 226.3/MT) and 46% YoY to USD 56.1/MT in Africa (realization up 3% YoY to USD 255.3/MT). India business delivered 4% YoY growth in soda ash volumes and also improved realization, but profitability was dented by higher power and plant fixed cost. Europe was subdued with EBITDA/MT declining 65% YoY to GBP28.3 due to higher energy and plant fixed cost.

Key Drivers: TTCHs standalone business witnessed a growth of 15.3% YoY to Rs 1060 Cr. The revenue from consumer products business increased by 18.8% YoY, mainly due to higher sales volume across categories and controlled marketing investments during the quarter. Its product (Tata Salt) continues to maintain a leadership position with a market share in excess of 25% along with the company has launched snacks products and detergent powder. The detergent powder is in the pilot stage in West Bengal and has been receiving a positive response. Domestic demand remains balanced with pockets of tightness witnessed in the market in the previous quarter. The near term plan is to attain a turnover of Rs 5000 cr in the consumer segment with Rs 450 cr contributed by salt, pulses, and spices. Company Nellore plant for nutraceuticals is in the final stage of commissioning. The plant will go through pilot production and the company is targeting commercial production by the end of Dec 19. The company has guided to get into three segments in Lithium-ion business viz. 1) manufacturing of batteries (cell), 2) recycling of batteries, and 3) chemical coating which goes into making batteries. The company has also hinted at getting into manufacturing battery pack at later stages.

Financial: Company had reported a Revenue of Rs 2845 cr in Q4FY19 Vs Rs 2628 cr in Q4FY18 up 8.1%, Net Profit up 26% to Rs 450 cr in Q4FY19 vs Rs 356 cr in Q4FY18, whereas EBITDA stands at Rs 629 cr in Q4FY19 vs Rs 537 cr in Q4FY18 up 17%. EBITDA margins up 180 bps to 22.8% in Q4FY19 from 21% in Q4FY18.

Amara Raja Batteries Ltd(NSE: AMARAJABAT ) (Share Price: Rs.640 ): Avoid

Valuation: Fairly-Valued stock with TTM PE of 22x.

Reasons to Avoid: Amara Raja Batteries (ARBL) said in a statement in the month of April 19 that it has ended all agreements with its co-promoter entity and technology partner (Johnson Controls) with effect from April 1, 2019. Agreements include shareholders agreement, share subscription & investment agreement, technical assistance & licensing agreement and power frame technology license agreement. The end of an association with Johnson Control, however, raises concerns over the future innovation pipeline at ARBL, since existing business to run unchanged but future technology innovation pipeline looks uncertain for which we believe it will effect on the valuation multiple being commanded by the company.

Financial: On the financial front in Q3FY19 Net Sales was Rs 1694 crore vs Rs. 1554 crore in Q3FY18 up 9%. Net Profit at Rs. 131 crores in Q3FY19 vs Rs. 134 crore in Q3FY18 down 2.6%. Whereas, EBITDA stands at Rs. 253 crores in December 2018 up 4.6% from Rs. 242 crore in December 2017.

Marico Ltd (NSE: MARICO) (Share Price: Rs.364 ): Potential Buy

Valuation:Over-Valued stock with TTM PE of 42x.

Reasons to Consider: In Q4FY19, Marico witnessed a stable demand environment and healthy offtake on account of the competitive strength of its products. Rural growth stood ahead of urban growth. However, the same has to be keenly monitored in view of some sluggishness seen at the wholesale level at the end of March 2019. We believe volume growth of 8 percent has been aided by healthy growth in Parachute & Saffola backed by strong promotional activity, while value-added hair oil portfolio performance was muted during the quarter. The international business had a reasonable quarter, with Bangladesh and Vietnam performing well. Going forward (OPM) is expected to improve marginally due to easing input cost pressure (especially copra prices) and provides growth and margin visibility in the coming quarter.

Key Drivers: Inline with its innovation strategy, Marico launched many new products during Q4FY2019. The company launched a new range of skincare products under the new brand, Kaya Youth Oz (comprising face cream, face wash, micellar water, and face wipes). In the food space, the company launched healthier versions of ready-to-cook poha and upma by including millets and quinoa. The company also launched organic food offerings under Coco Soul brand - coconut sugar, coconut chips, coconut peanut butter and coconut almond butter in selected markets. New launches remain at the core of the companys growth strategy. We expect many more new launches in the value-added hair oil and food category which will be the key driver for the stock in the coming quarters. New launches will be well supported by adequate media and promotional spends.

Financial: Company had reported a Revenue of Rs 1609 cr in Q4FY19 Vs Rs 1480 cr in Q4FY18 up 8%, Net Profit up 118% to Rs 401 cr in Q4FY19 vs Rs 183 cr in Q4FY18, whereas EBITDA stands at Rs 311 cr in Q4FY19 vs Rs 275 cr in Q4FY18 up 13%.

Share Market Tips For May 2019: 1st Week

Fortis Healthcare Ltd (NSE: FORTIS ) (Share Price: Rs.138): Avoid

Valuation: Over-Valued stock with negative earnings.

Reasons to avoid: Company has been in news from last year due to its corporate governance issue and its promoter stake sale to Malaysian group entity IHH healthcare where the SC has put this transaction on hold due to the petition filed by Japanese drugmaker Daiichi Sankyo alleging former promoters - brothers Malvinder and Shivinder Singh violated undertakings and court orders. Daiichi had sought a stay on the Fortis sale as the Singh brothers had not fulfilled their commitment to pay them as per the Delhi High Courts orders. Bidding for cash-strapped Fortis kicked off earlier this year after its founders, brothers Malvinder and Shivinder Singh, lost their shareholding due to debt, and allegations that they had improperly taken funds from the company. On financial front also the company has posted a quarterly loss as against profit in the previous quarter and EBITDA was also declined 14% during the quarter.

Financial: On the financial front in Q3FY19 Net Sales was Rs 1103 crore vs Rs. 1120 crore in Q3FY18 down 1.55%. Net Loss at Rs. 197 crore in Q3FY19 vs Net Profit of Rs. 19 crore in Q3FY18. Whereas, EBITDA stands at Rs. 81 crore in December 2018 down 14% from Rs. 94 crore in December 2017.

HEG Ltd(NSE: HEG ) (Share Price: Rs.1761): Avoid

Valuation:Under-Valued stock with TTM PE of 8x..

Reasons to avoid: For Q4FY19, we expect blended realisations to decline QoQ on the back of a fall in graphite electrodes prices for both UHP grade electrodes as well as HP grade electrodes. For Q4FY19, we expect HEG to report capacity utilization of 80% compared (84% in Q4FY18 and 82% in Q3FY19). Due to the higher price of needle coke, it will impact raw material costs. Thus, the top line is expected to come down 14.5% QoQ and EBITDA also likely to come down, implying an EBITDA margin of around 48% due to higher raw material prices (73.6% in Q4FY18 and 62.6% in Q3FY19).

Financial: On the financial front in Q3FY19 Net Sales was Rs 1865 crore vs Rs. 843 crore in Q3FY18 up 120%. Net Profit at Rs. 867 crore in Q3FY19 vs Rs. 342 crore in Q3FY18 up 153%. Whereas, EBITDA stands at Rs. 1313 crore in December 2018 up 135% from Rs. 559 crore in December 2017.p>

Hero Motocorp Ltd (NSE: HEROMOTOCO ) (Share Price: Rs.2526): Potential Buy

Valuation:Fairly-Valued stock with TTM PE of 15x

Reasons to consider: Hero MotoCorp (Hero) has reported results for the Q4. Revenue at Rs. 7,885 crores declined by 8% yoy and net Profit down 25% to Rs 730 cr yoy. The drop in revenue can be attributed to a sharp 11% decline in volumes, while realization per vehicle rose by 3.5% yoy on account of price hikes taken by the company. Heros management has identified the reasons for falling market share and renewed its focus on the 150-200cc segment (where buyers are moving) and on the scooters (where Hero is late entrant). Since the auto industry has seen a slowdown in 1HFY20 but due to the good festive season, pre-buying ahead of the implementation of BSVI, a lower base, the expectation of near normal monsoon and further interest rate reduction would make 2HFY20 better.

Drivers: Hero has displayed great concepts in the premium segment (200cc & 250cc) and is expected to launch three new motorcycles (Xpulse200, Xpulse 200T and HX250R). On the operating performance front, commodity prices have stabilized from the last few quarters, focus on the premium motorcycles & scooters and higher realization post BS6 to aid further. We believe the EBITDA Margins have bottomed out and is ready to bounce back gradually in the coming years due to cost rationalization and a combination of multiple things, along with Heros strategy of taking price increase in small steps. However, for the next 1-2 quarters, the margins to hover around the current levels as the headwinds and tailwinds are neutralizing each other.

Financial: Company had reported a Revenue of Rs 7885 cr in Q4FY19 Vs Rs 8564 cr in Q4FY18 down 8%, Net Profit down 25% to Rs 730 cr in Q4FY19 vs Rs 967.5 cr in Q4FY18, whereas EBITDA stands at Rs 1069 cr in Q4FY19 vs Rs 1371 cr in Q4FY18 down 22%. EBITDA margins declined 240bps to 13.6% in Q4FY19 from 16% in Q4FY18.

Share Market Tips For April 2019: 4th Week

Tata Global Beverage Ltd. (NSE: TATAGLOBAL) (Share Price: Rs.215): Potential Buy (10 Steps To Pick The Best Stocks)

Valuation: Fairly-Valued stock with TTM PE of 32x.

Reasons to consider: TGBLs India business witnessed volume growth of 12% aided by strong growth in Tata Tea Gold, Agni, Spice mix, Chakra Gold and Gemini brands. Growth was seen in both regional and national brands. TGBL had taken select price hikes in India tea business in the previous quarter, benefits of which will be reflected in Q1FY20. Starbucks store count stood at 146 stores (opened 15 new stores in Q4FY19 and 30 in FY19). Topline saw strong growth of 30% in FY2019. The management expects Starbucks to be breakeven at EBITDA level in the next 1-2 quarters.

Drivers: TGBL commands 20% market share in tea segment in India and expects to continue growing ahead of the market led by new launches in the economy (elaichi and masala chai) and premium segments (Chakra Gold Activ+ and Kanan Devan Duet in southern markets). The company has opened six new Tata Cha stores in Bangalore with a view to scale up the out of home tea drinking experience format significantly. However, the company focusing on improving its product mix in favour of green tea and premium offerings. Nourishco (50-50 JV with PepsiCo) full year growth stood at 10%YoY growth was led by volumes. The management stated that this entity is close to breakeven levels.

Financial: Company had reported a Revenue of Rs 1775 in Q4FY19 Vs Rs 1689 in Q4FY18 up 5%, Net Profit down 49% to Rs 36 cr in Q4FY19 vs Rs 72 cr in Q4FY18, whereas EBITDA stands at Rs 174 cr in Q4FY19 vs Rs 146 cr in Q4FY18 up 20%.

Avenue Supermarts Ltd. (NSE: DMART) (Share Price: Rs.1300): Avoid

Valuation: Over-Valued stock with TTM PE of 90x.

Reasons to avoid: D-Mart operates in a retail grocery business where competition is rising and retail is becoming an infinite game along with the bigger risk of the rapid expansion of Reliance Retail. Here, Competition means risks to same-store-sales-growth, operating margins and stock valuations. Where, reliance's grocery revenues are now 1.7 times Avenue's estimated grocery revenue and grocery sales grew 65 percent in FY19 against 33 percent for Avenue. Rising competition may blunt DMart's first-mover advantage which will effects its margins and SSSG growth in near term and considering the P/E multiple currently its trading in market slightly miss on the operating margins or on SSSG growth will impact on stock price.

Financial: On the financial front in Q3FY19 Net Sales was Rs 5451 crore vs Rs. 4095 crore in Q3FY18 up 33%. Net Profit at Rs. 257 crore in Q3FY19 vs Rs. 252 crore in Q3FY18 up 2%. Whereas, EBITDA stands at Rs. 462 crore in December 2018 up 6.1% from Rs. 435 crore in December 2017. Avenue Supermart EPS has increased to Rs. 4.12 in December 2018 from Rs. 4.03 in December 2017.

VIP Industries (NSE: VIPIND) (Share Price : Rs.472): Potential Buy

Valuation: Over-Valued stock with TTM PE of 43x.

Reasons to consider: VIP is the market leader in the organized luggage industry, with a revenue share of 50%. Samsonite is the second largest player followed by Safari with a share of 36% and 15% respectively. It has well-diversified product portfolio (six brands and multiple SKUs exceeds 1,500) with Strong distribution network (11,000 touch points), GST implementation (narrowed pricing gap with unorganized players ) and entry into the under penetrated ladies hand bags and backpack market is likely to drive sales CAGR of double digit. While headwinds from currency & crude volatility prevail, product premiumisation (rising share of Caprese and Carlton) and increase in production from captive facilities at Bangladesh will aid in 40bps EBITDA margin expansion.

Key Drivers: Luggage/backpack/handbags market is dominated by unorganized players with a share of 67%, 67%, 92% respectively. With GST implementation, it has brought unorganized players within the tax net and reduced the pricing gap making organized players more competitive. Bangladesh expansion to improve profitability profile as its operations gain scale dependency on China is expected to come down and improve the profitability of VIP due to labour cost arbitrage and import duty advantage. Its brand pull for Skybags is high, Carlton is extremely sturdy product, and trade margins are highest for unbranded products.

Financial: Company had reported a Revenue of Rs 430 cr in Q3FY19 Vs Rs 338 cr in Q3FY18 up 30%, Net Profit down 10% to Rs 24 cr in Q3FY19 vs Rs 27 cr in Q3FY18, whereas EBITDA stands at Rs 40 cr in Q3FY19 vs Rs 43 cr in Q3FY18 down 6%.

Essel Propack Ltd. (NSE: ESSELPACK) (Share Price : Rs.135): Avoid

Valuation: Fairly-Valued stock with TTM PE of 24x.

Reasons to avoid: EPL is one of the largest players in the oral care category (with 40% market share), the company is looking to increase its presence in the non-oral care business (such as beauty, cosmetics and pharmaceuticals). Emerging markets would be the key driver for oral and non-oral care categories due to lower product penetration. In a recent development, private equity player Blackstone has entered into an agreement with Ashok Goel Trust to purchase 51% stake in Essel Propack (EPL) for a consideration of Rs 2157 crore ( Rs 134 /share). Ashok Goel Trust and its affiliates currently hold 57% of EPL. Further, as per the takeover code, this transaction will trigger a mandatory open offer for a purchase of additional 26% shares of the company. The open offer price has been fixed at Rs 139/share. Taking all this into consideration all positive news has been factored in the stock at these price and recent corporate governance issue development of its group company also weigh negative effect on the stock.

Financial: On the financial front in Q3FY19 Net Sales was Rs 695 crore vs Rs. 595 crore in Q3FY18 up 16.7%. Net Profit at Rs. 46 crore in Q3FY19 vs Rs. 41 crore in Q3FY18 up 13.8%. Whereas, EBITDA stands at Rs. 131.3 crore in December 2018 up 14.8% from Rs. 114.3 crore in December 2017.

PC Jeweller Ltd. (NSE: PCJEWELLER) (Share Price : Rs. 132): Avoid

Valuation: Fairly-Valued stock with TTM PE of 14x.

Reasons to avoid: The promoters of PC Jewellers allegedly had a connection with the promoters of Vakrangee, which is already under investigation. Later, one of PC Jewellers' promoters gifted some of his shares to his family members through off-market transactions along with the company also withdrew its buyback offer after failure to obtain clearance from ban which raises the corporate governance issue and resultant the correction in stock of more than 60% from its highs. Since retail investor has kept on increasing the stake this could also mean that stock has in a weak hands and its a highly violatile stock. Company performance also been deteriorating quarter on quarter.

Financial: On the financial front in Q3FY19 Net Sales was Rs 2120 crore vs Rs. 2645 crore in Q3FY18 down 20%. Net Profit at Rs. 138 crore in Q3FY19 vs Rs. 163 crore in Q3FY18 down 15%. Whereas, EBITDA stands at Rs. 285 crore in December 2018 down 10% from Rs. 315 crore in December 2017.

Share Market Tips For April 2019: 3rdWeek

Pidilite Industries. (NSE:PIDIND) (Share Price: Rs.1292): Potential Buy (10 Steps To Pick The Best Stocks)

Valuation: Over-Valued stock with TTM PE of 65x.

Reasons to consider: Pidilite is a dominant player in Indias adhesive market with a market share of 70% in its leading brand categories (Fevicol) in the organised segment. The companys major segments, C&B (consumer & bazaar) product includes, Fevicol & M-seal and specialty industrial chemical recorded sales CAGR of 14%, 8% (standalone), respectively in FY11-18. The C&B segment growth came on the back of demand from the construction, repair & maintenance activities. Its robust 20% YoY topline growth was primarily driven by the C&B (consumer & bazaar) segment led by a significant improvement in demand and commendable scale-up of operations.

Drivers: According to the management there is some respite from falling prices of its major raw material which is VAM where prices below US$1000/tonne from the peak of US$1600/tonne. Thus, we believe the declining trend of VAM & stable rupee would help in recouping the operating margins to 21% in FY21E (18% currently). We maintain our positive stance on growth prospects considering it is the market leader in many consumer adhesive categories and command pricing power. Considering it is set to commence production of Monomethyl Hydrazene synthesis and continuous investments in capacity creations for plants, R&D facilities, Commercialization of new molecules will help PI in clocking 20% CAGR which gives us confidence and superior growth visibility for the next 2-3 years. Along with a strong balance sheet, healthy return ratios & efficient deployment of cash for inorganic expansion gives us comfort despite relatively rich valuation multiples.

Financial: Company had reported a Revenue of Rs 1848 cr in Q3FY19 Vs Rs 1543 cr in Q3FY18 up 19.8%, Net Profit declined by 8% to Rs 219 cr in Q3FY19 vs Rs 239 cr in Q3FY18, whereas EBITDA stands at Rs 337 cr in Q3FY19 vs Rs 370 cr in Q3FY18 down 9% and EBITDA margins were also down 578bps to 18.2% in Q3FY19 from 24% in Q3FY18.

UPL Ltd (NSE:UPL) (Share Price: Rs.932): Potential Buy

Valuation: Fairly-Valued stock with TTM PE of 24x.

Reasons to consider: UPL Limited provides crop protection solutions. The Company is engaged in the business of agrochemicals, industrial chemicals, chemical intermediates, and specialty chemicals. UPL solid 17.4% topline growth was driven by volume growth of 6% and a price hike of 7% YoY. Geographically, LatAM (+27%), Europe (+37%) and North America (+22%) which aided growth. EBITDA increased 22.6% YoY to Rs 1016 cr with the margin expanding 90bps YoY to 20.6% whereas PAT was flattish YoY at RS 634 cr.

Drivers: The company witnessed disappointing quarter primarily on account of erratic rainfall and poor Kharif yield in India which collectively resulted in stressed cash flows for farmers. However, company has continued its outperformance in the LatAM market (market growth in Brazil @ 18%) with 27% growth driven by Unizeb, Sperto and successful launch of a herbicide (branded as Strim). It has successfully closed the transaction of Arysta as on 31st Jan 2019. The company would be consolidating two months of Arystas financials in Q4FY19. Arystas revenue in CY18 stood at USD2b and EBITDA at USD450m. The companys brand Lifeline continues to grow despite the increase in acreage of Dicamba-tolerant seeds. Rather, the company launched Lifeline in Canade and expects it to be significant in near future. UPL reported a revenue growth of 21.5% in North America to Rs 866 cr (22% contribution in Q3FY19) and revenue growth of 36.6% to Rs 511 cr in Europe (17% contribution in Q3FY19). However, UPL performance has been above par with the growth in Q3FY19 being driven by growth in Mancozeb and Sugarbeet herbicide.

Financial: Company had reported a Revenue of Rs 4921 cr in Q3FY19 Vs Rs 4194 cr in Q3FY18 up 17.4%, Net Profit remain flattish to Rs 634 cr in Q3FY19 vs Rs 632 cr in Q3FY18, whereas EBITDA stands at Rs 1016 cr in Q3FY19 vs Rs 829 cr in Q3FY18 up 22.6% and EBITDA margins were also up 90bps to 20.6% in Q3FY19 from 19.8% in Q3FY18.

Asian Paints Ltd (NSE:Asian Paints) (Share Price: Rs.1465): Potential Buy

Valuation: Over-Valued stock with TTM PE of 65x.

Reasons to consider: Asian Paints is the industry leader in the decorative paint segment with 53% market share and a dealer network of over 55,000 across India. It derives 89% of its top line from the decorative segment while the rest comes from the industrial segment. APL posted a robust performance with topline growth of 24% YoY since after FY11 led by strong growth in volume. Strong festive demand coupled with aggressive price hikes which helped the top line to grow double-digit in Q3FY19. In concall it has given a cautiously optimistic outlook as sales growth will remain sensitive to overall demand and elections with high raw material prices will aid to its margins downward despite a recent price hike in its products.

Drivers: Reduction in the GST rate from 28% to 18% would benefit organised players in the long run while rising tax compliance would hit the unorganised segment. With the expansion in paints capacity in Andhra Pradesh and Karnataka, APL is best placed to capture this additional demand, going ahead. It has witnessed a significant expansion in EBTIDA margin (by 400 bps in FY15-17) owing to lower raw material prices and rising proportion of premium products in the portfolio. However, a reversal was witnessed from FY18 onwards owing to the inability to pass on a sudden rise in crude based raw material prices. However, the management has indicated at a price hike at a regular interval in case of adverse movement of raw material prices to stable the margins. We believe the strong volume witnessed during the quarter factoring in structural demand given the lower per capita paint consumption in India with rising increase spending in infra and housing by the govt will give the boost to paint companies and APL will be the market leader will major benefit in this space.

Financial: Company had reported a Revenue of Rs 5294 cr in Q3FY19 Vs Rs 4260 cr in Q3FY18 up 24%, Net Profit improved 14% to Rs 647 cr in Q3FY19 vs Rs 567 cr in Q3FY18, whereas EBITDA stands at Rs 1043 cr in Q3FY19 vs Rs 891 cr in Q3FY18 up 17% and however, EBITDA margins declined due to increase in raw material prices down 122bps to 19.7% in Q3FY19 from 20.9% in Q3FY18.

Share Market Tips For April 2019: 2nd Week

Varun Beverages Ltd. (NSE: VBL) (Share Price: Rs.852 ): Potential Buy

Valuation: Over-Valued stock with TTM PE of 53x.

Reasons to consider: VBL is the second largest Pepsico franchisee in the world (ex-US) for carbonated soft drinks (CSDs) and non-carbonated beverages (NCBs). VBL manufactures and distributes PepsiCo products in the territories assigned through exclusive franchise agreement. It enjoys over 25 years of strategic association with PepsiCo and today accounts for 51% of PepsiCos beverage sales volume in India. Revenues witnessed growth of 49% to Rs 785 crore led by 40% volume growth in Q4. The company reported organic volume growth of 12.6% in the India business whereas it reported 9.8% on a consolidated basis during 2018. In Q4 EBITDA grew 46% YoY to 47.8 crore. Operating margins declined 119 bps to 19.7%. Net Loss during the quarter declined 2% to Rs 70.8 crore.

Drivers: VBL has expanded its operations in India through the acquisition of additional territories from PepsiCo in the last few years. On the rising health and wellness wave, india is witnessing a shift from the CSD to the NCB segment. To tap this opportunity, PepsiCo is focused on innovation and launch of new drinks in NCB space. In the recent past, it has launched Masala Nimbooz, Tropicana Fruitz, 7 Up Revive & Sting. The company plans to leverage on the Tropicana brand and launch more fruit juices. It has been continuously looking for newer territories to expand its base in untapped geographies and will remain a proxy play on soft drink industry in India. New territories & products give company an opportunity to expand volume & market share. Recently it has acquire franchisee rights of the beverage business of the foods and snacks major in southern and western India and with correction in the sugar price will also improve margins for the company in future.

Financial: Company had reported a Revenue of Rs 785 cr in Q4CY18 Vs Rs 527 cr in Q4FY17 up 3.4%, Net Loss declined by 2% to Rs 70.8 cr in Q4CY18 vs Rs 72.1 cr in Q4FY17, whereas EBITDA stands at Rs 47.7 cr in Q4CY18 vs Rs 32.6 cr in Q4FY17 up 46.6%. Currently, D/E ratio stood at 1.3x.

JK Lakshmi Cement Ltd (NSE: JKLAKSHMI) (Share Price : Rs.356): Potential Buy

Valuation: Over-Valued stock with TTM PE of 55x.

Reasons to consider: JK Lakshmi Cement Limited is a holding company. The Company is a manufacturer of cement. During Q3 company volumes increased 9% YoY to 2.31mt and realizations of Rs 4,056/t (+2% YoY). Revenue grew 12% YoY to Rs 935 cr and Net profit also grew 71% to Rs 14.8 cr YoY, whereas, power consumption improved to 69KWH/MT v/s 70KHW/MT in Q3FY18.

Key Drivers: Company has been witnessing several positive factors like sustained infrastructure spends in low cost housing, roads, pickup in private capex which will boost cement consumption. The northern region (where JK Cement sells 60% of volumes) is expected to witness limited capacity addition CAGR of 3.0% while demand is expected to grow 7-8% led by the above mentioned reasons. These factors would result in improved utilisations. Majority of the companys capacity expansion is complete while only 0.8 MT grinding unit at Odisha yet to be commissioned. The grinding unit will cater to the coastal Odisha market where realizations are healthy. Furthermore, the addition of the grinding unit, its capacity will be 13.3 MT by Q4FY19 and with limited clinker capacity addition and improved demand in the northern region, we expect utilisation to firm up in coming years. Company has been taken various initiatives like cost control, captive power plant (20 MW) and conveyor belt at Durg along with softening prices of some key raw materials like petcoke are expected to drive margins in coming quarter.

Financial: Company had reported a Revenue of Rs 935 cr in Q3FY19 Vs Rs 837 cr in Q3FY18 up 11.8%, Net profit of Rs 14.8 cr in Q3FY19 vs Rs 8.6 cr in Q3FY18 up 71%, whereas EBITDA stands at Rs 98.3 cr in Q3FY19 vs Rs 94.3 cr in Q3FY18 up 4.2% and EBITDA margin down by 76bps to 10.5% in Q3FY19 vs 11.3% in Q3FY18.

Greenply Industries Ltd (NSE: GREENPLY) (Share Price: Rs.166): Potential Buy

Valuation: Over-Valued stock with TTM PE of 19x.

Reasons to consider: Greenply Industries Limited is an interior infrastructure company. The Company is engaged in the business of manufacturing plywood and allied products, medium density fiberboards (MDF) and allied products through its factories at various locations. Greenply Industries (GIL) topline grew 15.9% YoY to 462.9 crore on account of strong growth in plywood business and with government has set an aim to build 1.2cr houses by 2022 under PMAY, which would increase the demand for plywood industry for making doors and furniture.

Key Drivers: GILs plywood volumes grew 17.3% to 14.6 million square metre (MSM) in Q3FY19. This was on account of 22% volume growth in the premium plywood segment, leading the company to gain additional market share in this segment. Also, mid-segment plywood showed 9% volume growth during the quarter. MDF division revenues grew 7.7% YoY to 123.4 crore due to strong volume growth of 33.9% YoY to 58648 CBM in Q3FY19. Of the 58648 CBM sales volumes in Q3FY19, 32279 CBM came from Uttarakhand plant, while 26369 CBM was from AP plant. With most players, including GIL, taking price cuts in the MDF segment and with higher sales volume of the export component, MDF realizations fell 19.8% YoY to Rs 20960/CBM in Q3FY19. Its working capital days stretched by 11 days YoY to 87 days whereas, net D/E was at 0.77 in Q3FY18 against 0.69 in Q3FY18. But we remain positive on GIL as the share of organised plywood players (currently 30% of plywood market) is set to expand with GST rate cut, higher brand aspirations & GILs strong brand presence. Going ahead, the management also expects double digit growth in the plywood division in the next two to three years

Financial: Company had reported a Revenue of Rs 463 cr in Q3FY19 Vs Rs 339.3 cr in Q3FY18 up 15.9%, Net profit of Rs 35.7 cr in Q3FY19 vs Rs 36.1 cr in Q3FY18 down 1%, whereas EBITDA stands at Rs 58.3 cr in Q3FY19 vs Rs 62.7 cr in Q3FY18 down 6.9% and EBITDA margin down by 309bps to 12.6% in Q3FY19 vs 15.7% in Q3FY18.

Eicher Motors Ltd. (NSE: EICHERMOT) (Share Price: Rs.20980): Potential Buy

Valuation: Fairly-Valued stock with TTM PE of 28x.

Reasons to consider: Eicher Motors Limited is a parent of Royal Enfiled that offers middleweight motorcycles in India. Royal Enfield operates in India, and over 40 countries around the world. Company has been reporting subdued performance. Consolidated revenues for Q3FY19 were at 2,341 crore up 3.4% YoY. EBITDA came in at 680 crore down 5.4% YoY & EBITDA margins at 29.0% down 270 bps YoY with PAT in Q3FY19 was down 1.3% YoY to 533 crore.

Key Drivers: Royal Enfield motorcycles in the past year have witnessed multiple headwinds which includes increase in cost of ownership of 2-W due to increase in the insurance cost of 2W, loss of production due to labour strike at one of its plants near Chennai (28000 units). All this has leads to subdued demand for RE. Eicher motors is also a prominent player in the domestic CV space through its JV with Volvo. As on dec 2018, total sales volume at the CV unit has grown at 17% YoY to 58,000 units. Muted demand prospects at RE as well muted margin in the VECV business unit will impact earnings in near term. With recent change in management as Vinod K. Dasar appoints as CEO and post correction stock looks attractive on valuation front.

Financial: Company had reported a Revenue of Rs 2341 cr in Q3FY19 Vs Rs 2264 cr in Q3FY18 up 3.4%, Net profit of Rs 533 cr in Q3FY19 vs Rs 539 cr in Q3FY18 down 1.3%, whereas EBITDA stands at Rs 680 cr in Q3FY19 vs Rs 718 cr in Q3FY18 down 5.4% and EBITDA margin down by 270bps to 29% in Q3FY19 vs 31.7% in Q3FY18.

Share Market Tips For April 2019: 1st Week

Bajaj Finance Ltd. (NSE: BAJFINANCE) (Share Price: Rs.3047): Potential Buy

Valuation: Over-Valued stock with TTM P/BV of 9.8x.

Reasons to consider: Bajaj Finance Limited (BFL) is a non-banking finance company (NBFC). It is one of the largest retail asset financing company. The Company is engaged in lending and allied activities. It focuses on consumer lending, small and medium-sized enterprises (SME) lending, commercial lending, rural lending, fixed deposits and value-added services. Its consumer lending products include two-wheelers and three-wheelers finance, consumer durables finance, digital products finance, retailer finance, salaried personal loans, e-commerce consumer finance, e-commerce seller finance and home loan. Its SME lending products include loan against property and business loans. Its commercial lending products include loan against securities and financial institutions group lending business.

Key Drivers: Company has posted robust performance in a tough environment. It has seen robust loan growth during Q3, where its assets book grew strong 41 percent YoY to Rs 109,930 crore. Loan growth was contributed mainly by consumer lending and mortgages. The growth in securities lending was muted while robust growth in rural lending continued. Management has always guided a loan growth rate of 20-25 percent but it has been consistently beating the guidance. Despite the cost of funds moving up, BFLs margins improved in Q3. BFL always traded at premium valuations due to its higher earnings growth trajectory. Currently, BFL stock is trading at FY20 estimated P/B ratio of 6.3 which is significant premium to its peers. One should look out for any price correction as an opportunity to buy into the stock.

Financial: Its annouces Q3 result where, Net interest income stood at Rs 3201 cr in Q3FY19 vs Rs 2192 cr in Q3FY18. Whereas, AUM grews to Rs 109930 cr in Q3FY19 up 40.9% vs Rs 78033 cr in Q3FY18 YoY with Steady asset quality. Net profit up 53.6% to Rs 1060 cr Vs Rs 690 cr YoY and NIM stood at 11.3% YoY.

Tata Motors Ltd (NSE: TATAMOTORS)(Share Price : Rs.185): Potential Buy

Valuation: Under-Valued stock with negative earnings.

Reasons to avoid: Tata Motors Limited is an automobile company. Tata Motors owns iconic brands Jaguar and Land Rover, while offering a broad product line of all types of commercial and passenger vehicles, sports utility vehicles, luxury passenger, large semi-trucks. Companys hold 45% of market share of commercial vehicle in india. Auto sector has faced the slowdown in india market where the inventory pile-up at dealers location was high in second half due to low demand, liquidity stress and higher fuel prices but TML has been an outperformer compare to its peers and gaining market share in domestic passenger and commercial vehicle segment where market share in CV was up 60 bps while PV was up 50 bps.

Key Drivers: TML Outperform the peers and gained the market share in domestic market. Company (PV) segment continues to outperform the industry with the new products driving the growth and Continued strong profitability in CV, EBITDA stable despite challenging market conditions are positive. In the domestic market M&HCV trucks de-grew 15%, ILCV trucks +8%, SCV & Pick Ups +15% and CV Passenger -16%. PV was up 3% with new products continuing to gain strong traction in the market. In fiscal year 2019 so far has been a challenging period for the industry. Despite the muted growth, Tata Motors has delivered strong results, registered an impressive profitable growth this year on the back of exciting products, renewed brand positioning and aggressive cost reduction. TML numbers has been good on standlone basis by gaining market share in domestic market. Considering the china slowdown, drop in JLR sales and the highest ever quarterly loss posted by TML due to one time asset impairment the stock has already corrected substantially from 52-wk high. But gaining market share in domestic market is positive sign and given the stock price already factored the china slowdown and weak JLR sales number. Currently stock looks attractive at these price.

Financial: Total Revenue was Rs 77,001 cr in Q3FY19 vs Rs 73,366 cr in Q3FY18 up 5%. Net Profit was Rs(26,993) cr in Q3FY19 vs Rs 1199 cr in Q3FY18 while Ebitda was Rs 6,545 cr in Q3FY19 vs Rs 7,924 cr in Q3FY18 down 18% and Ebitda margins were 8.5% in Q3FY19 compare to 10.8% in Q3FY18 down 230bps. As there was an loss in this quarter EPS will not be comparable.

Share Market Tips For March 2019: 5th Week

POWERGRID (NSE: POWERGRID) (Share Price : Rs.197.50): Potential Buy (10 Steps To Pick The Best Stocks)

Valuation: Fairly-Valued stock with TTM PE of 12x.

Reasons to consider: Power Grid Corporation of India Limited is a transmission company engaged in the power transmission business with responsibility for planning, implementation, operation and maintenance of Inter-State Transmission System and operation of National and Regional Load Dispatch Centers. The Company's segments include Transmission, Telecom and Consultancy. Currently, company standalone capitalization stood at Rs 127b in 9MFY19 (Rs 68.6b in Q3), as against Rs 195b in 9MFY18. The company also capitalized Rs 39b of TBCB projects during the year. Telecom revenue/EBIT increased 13%/38% YoY to Rs 2.0b/Rs 1.1b in Q3FY19. Consultancy revenue increased 9% YoY to Rs 1.6b, but EBIT declined 15% YoY to Rs 0.7b in Q3FY19.

Key Drivers: Management highlighted that the government has envisaged transmission projects of Rs 433b. Of these, Rs 160b are to be bid out in the next one year. Considering with all these receivables have nearly doubled in nine months to Rs 70.6b as beneficiaries are delaying payments. Whereas, rising capitalisation of TBCB projects and higher share of the same in the upcoming projects will lead to a decline in the return profile of the company. At CMP, the stock trades at 1.5x FY20E P/BV for RoE of 16% and CoE of 10-11%. One can buy stock at current levels.

Financial: The company had reported a Revenue of Rs 8472 cr in Q3FY19 Vs Rs 7507 cr in Q3FY18 up 12.8%, Net profit of Rs 2331 cr in Q3FY19 vs Rs 2032 cr in Q3FY18 up 14.7%, whereas EBITDA stands at Rs 7988 cr in Q3FY19 vs Rs 6914 cr in Q3FY18 up 15% and EBITDA margin up 219bps to 94.3% in Q3FY19 vs 92.1% in Q3FY18.

HDFC BANK Ltd. (NSE: HDFC BANK) (Share Price : Rs.2280): Potential Buy

Valuation: Over-Valued stock with TTM P/BV of 5.85x.

Reasons to consider: HDFC Bank Limited is India's largest private sector bank. The Bank offers a range of banking services covering commercial and investment banking on the wholesale side and transactional/branch banking on the retail side. It also offers financial services. The Bank's segments include Treasury, Retail banking, Wholesale banking and Other banking business. HDFC Bank PAT growth has been consistent at 20% since FY16 vs. 30% in the past and grew to Rs 17457 crore in FY18. In Q3FY19, 54% was retail (Rs 420900 crore) & 46% corporate book of Rs 360051 crore. In Q3FY19, personal loans & credit cards continued their strong growth trajectory. It enjoys the largest market share in credit cards, which fetches higher margins and returns.

Key Drivers: The bank is well placed to harness both retail & expected corporate pick-up. The bank has a strong liability franchise with CASA of 48% and retail term deposit comprises more than 80% of deposit of Rs 788770 crore as on FY18. Compare to others banks, it has maintained stable asset quality where its GNPAs & NNPAs remain in range of 1-1.5% from past 20 quarters. Considering, the healthy balance sheet growth, superior asset quality & management, the bank is well poised to deliver consistently with superior margin & robust return ratios. However, the bank has always trades with premium valuation. One can buy the stock at correction.

Financial: Its annouces Q3 result where, Net interest income stood at Rs 12576 cr in Q3FY19 vs Rs 10314 cr in Q3FY18. Net advances grew by 24% YoY to Rs 780951 cr. CASA de-grown by 320bps to 40.7% YoY. Net profit up 20% to Rs 5585 cr Vs Rs 4642 cr YoY. NIM remain stable at 4.3% YoY.

PHOENIX MILLS (NSE: PHOENIXLTD) (Share Price: Rs.655): Avoid

Valuation: Fairly-Valued stock with TTM PE of 35x.

Reasons to avoid: The Phoenix Mills Limited is an India-based company engaged in the construction of buildings carried out on own-account basis or on a fee or contract basis. The Company is engaged in the development and operation of malls and other real estate properties. It operates mainly in two segments: Property & Related Services, and Hospitality Services. Sailing on its retail-led mixed-use development model, the company has an operational asset portfolio of eight operational retail assets aggregating 5.9 million square feet (msf) and four operational commercial assets aggregating 1.16 million square feet.

Key Drivers: Focusing on completing its existing/upcoming projects by FY22/23 and de-leveraging its balance sheet will be a key driver for growth. The company plans to almost double its retail portfolio and triple its commercial asset portfolio. Phoenix has two under construction assets at Pune, Chennai with GLA of 1.12 msf and plans to develop commercial asset at PMC Hebbal with GLA of 0.65 msf. Once it is operational these expansions would augment PML's commercial portfolio to around 3 msf in next three to four years. Phoenix Mills Ltd provides a unique way to play Indias real-estate & retail growth story. It will be the prefer bet in real-estate sector due to its strong operational performance,scalability (through the CPPIB deal),robust cash generation and no issue in corporate governance. We will be positive on stock considering the decent valuation one can add the stock on dips

Financial: Total revenue Rs 440.4 cr in Q3FY19 vs Rs 416.6 cr in Q3FY18 up 6%. Net Profit at Rs. 70.8 cr in Q3FY19 vs Rs 65.2 cr in Q3FY18 up 9%. Ebitda stands at Rs.222.5 cr in Q3FY19 up 8% vs Rs. 206.7 cr in Q3FY18. PML Diluted EPS has increased to Rs. 4.61 in Q3FY19 vs Rs. 4.25 in Q3FY18 and Ebitda margins were 51% in Q3FY19 vs 50% in Q3FY18 up 2%.

Share Market Tips For March 2019: 4th Week

Cyient Ltd. (NSE: CYIENT) (Share Price: Rs.660) (Share Market tips): Potential Buy

Valuation: Under-Valued stock with TTM PE of 18x.

Reasons to consider: Cyient delivered weak performance in Q3FY19 on revenue front while margin expansion was a positive. Revenue was at USD 165.1mn was down 2.2% QoQ, (-1.5%) in CC(constant currency). Services (88% of rev, -0.2% QoQ CC) growth was below expectation while DLM (12% of rev, -10.3% QoQ) fall was less than expected. Aerospace & Defence (34.3% of rev, +0.5% QoQ) has been stable in a seasonally weak quarter. EBITDA Margin was up 103bps QoQ to 14.7%, led by margin expansion in Services (16.3%,+100bps QoQ) and DLM (4%, +30bps QoQ). Going forward, we expect revenue growth to be driven by ramp up in postponed deal in communication segment, acceleration in Aerospace & Defence (mainly led by higher spend from military and healthy spends in avionics & MRO) and improvement in semiconductor & utility space.

Drivers: The company will continue to make investments in Platforms & IPs which will aid future growth. We expect growth to come from Acceleration in Aerospace & Defence, Ramp-up in DLM and Recovery in Communication led by new order wins. Cyients Q3FY19 margins have improved 100 bps on the back of cost efficiency and rupee depreciation. Company is expected to witness healthy growth in the coming quarters mainly led by improved growth in communication and aerospace segment.

Financial: Revenue at Rs 1188 crore in Q3FY19 vs Rs. 983 crore in Q3FY18 up 20%. Net Profit at Rs. 92 crore in Q3FY19 vs Rs. 109 crore in Q3FY18 down 15.3% whereas, EBITDA stands at Rs. 175 crore in Q3FY19 vs Rs. 143 crore in Q3FY18 up 22% and EBITDA Margins at 14.78% in Q3FY19 up 18bps from 14.60% in Q3FY18.

Just Dial Ltd. (NSE: JUSTDIAL) (Share Price : Rs.612.50): Avoid

Valuation: Fairly-Valued stock with TTM PE of 22x.

Reasons to avoid: JD could be under-investing in A&P (Advertising and Promotion) in contrast to the aggressive cash-burns by most of domain-specific apps. Due to this it will effect on its product/service categories where it is used by their consumers and that affecting the extant paid-client base. We believe in coming quarter earnings revision cycle will likely to be weak as revenue growth will remains muted. Furthermore, major risk in long-term for JDs revenues/business model remains the growing generic search capabilities of Google + direct web-presence by medium/small enterprises with the falling costs of setting up websites. Thus, given the Q3 performance and the recent buy-back from the company are already priced-in the stock. One can avoid the stock and sell at higher levels.

Financial: On the financial front in Q3FY19 Net Sales was Rs 226.78 crore vs Rs. 196.79 crore in Q3FY18 up 15.24%. Net Profit at Rs. 57.34 crore in Q3FY19 vs Rs. 28.60 crore in Q3FY18 up 100.49%. Whereas, EBITDA stands at Rs. 89.29 crore in December 2018 up up 81.74% from Rs. Rs. 49.13 crore in December 2017.

Dish TV India Ltd. (NSE: DISHTV) (Share Price : Rs.40): Avoid

Valuation: Fairly-Valued stock with TTM PE of 22x.

Reasons to avoid: Company has posted good number in Q3 but it is un-comparable due to its merger with videocon d2h. The main threat to company is Jio, which had announced plans to enter the cable broadband and IPTV space, strengthened its distribution reach by acquiring a majority stake in two of the MSOs Hathway Cable and Network. The deal gave Jio access to 24 million households and 27000 LCOs. We believe this is a major breakthrough for last mile connectivity and that will effect on the ARPU's of the dish tv and shift in subscriber base. With, high promoter pledge (84% of promoters stake is pledged) is also a cause of concern as we have already seen recent carnage in the stock due to this.

Financial: On the financial front in Q3FY19 Net Sales was Rs 1517.45 crore vs Rs. 740.77 crore in Q3FY18 up 104.85%. Net Profit at Rs. 161.66 crore in Q3FY19 vs Rs 3.58 crore in Q3FY18 up 4615.64%. Whereas, EBITDA stands at Rs. 529.71 crore in December 2018 up 144.87% from Rs. 216.32 crore in December 2017. The numbers have been un-comparable due to merger with Videocon d2h.

Share Market Tips For March 2019: 3rd Week

Jubilant Foodworks Ltd. (NSE: JUBLFOOD) (Share Price : Rs.1332): Avoid (10 Steps To Pick The Best Stocks)

Valuation: Overvalued valued stock with TTM PE of 56x.

Reasons to avoid: Company has delivered strong Same Store Sales growth (SSSG) of 14.6% in Q3FY19 with dunkins becoming profitable in this quarter which has supported margins in the overall business. Domino's market share in Pizza is likely to be remain at 70%. But recent announcement of the management of Jubilant Group to charge 0.25% royalty on Jubilant brand from FY20 which have dampened its corporate governance issue. Nevertheless, it has reversed its decision of royalty payment after facing severe criticism from analyst community but still it will have negative impact on the stock in near term. Considering all the positive factor has discounted in the stock at these level with TTM PE 56x which is quite expensive and with recent launch of Hong's Kitchen (Chinese cuisine segment) it will also put pressure on margins in near term. So, one can avoid a stock at these levels.

Financial: On the financial front in Q3FY19 Net Sales was Rs 929.05 crore Vs Rs. 795.17 crore in Q3FY18 up 16.84%. Net Profit at Rs. 96.51 crore in Q3FY19 vs Rs. 66.02 crore in Q3FY18 up 46.17%. Whereas, EBITDA stands at Rs. 184.38 crore in December 2018 up 31.5% from Rs. 140.21 crore in December 2017.

Share Market Tips For March 2019: 2nd Week

Relaxo Footwears Ltd. (NSE: RELAXO) (Share Price: Rs. 755.75): Potential Buy

Valuation: Overvalued valued stock with TTM PE of 52x.

Reasons to consider: Relaxos Q3FY19 revenues jumped 20.6% YoY to Rs 551 crore. Due to strong volume growth we have seen 20% increased in revenue during the quarter. For the seventh consecutive quarter, Relaxo has reported double digit volume growth. The company continues to witness better growth compared to its peers. Management focusing on addition of new stores with increasing distribution reach and premiumization will benefit to gain a market share in coming quarter but also put pressure on the margins in near term.

Key Drivers: Management remains optimistic about the growth in domestic footwear industry and believe that the structural reforms like GST would help the organized sector to grow in the coming quarters. Due to implementation of GST, organized sector would continue to outperform and Relaxo being a market leader in the economy category will be the key driver for the stock. The contribution of mid category would grow for the company, going ahead (15% to 20%).

Financials: In Q3FY19 Net Sales was Rs 551 crore Vs Rs. 457 crore in Q3FY18 up 20.6%. Net Profit at Rs. 35.6 crore in Q3FY19 down 6.7% from Rs. 38.2 crore in Q3FY18, whereas EBITDA stands at Rs. 72.7 crore in Q3FY19 vs Rs. 71.9 crore in Q3FY18 up 1.1%.

JET AIRWAYS Ltd. (NSE: JETAIRWAYS) (Share Price: Rs. 232): Avoid

Valuation: Overvalued stock with negative earnings.

Reasons to avoid: The company is posting negative earnings continuously for the last four quarters. The company is having a high debt of Rs 9600 crores on balance sheet as of 9MFY19. On top of that, recently it has added debts of Rs.225 crore by pledging fixed deposits worth Rs.1500 crores with SBI. Though this Pledging can solve short term liquidity crunch of the company but weakens its leverage status. Currently, jet airways not paying salary to its employees to control cost. Which further led to the downgrading by ICRA in Jan-19.

Financials: On the financial front in Q3FY19 Net Sales was Rs 6148 crore Vs Rs. 6086 crore in Q3FY18 up 1%. Net Loss at Rs. 588 crores in Q3FY19 from profit of Rs. 165 crore in Q3FY18. The company posted negative operating margins of (4%) in Q3FY19 compared to positive operating margin of 9% in Q3FY18 whereas, In Q3FY19 interest cost also increased by 15% to Rs 257 crore.

Asian Granito India (NSE: ASIANTILES) (Share Price : Rs.176.65): Potential Buy

Valuation: Fairly-Valued stock with TTM PE of 16x.

Reasons to avoid: AGL is one of the top three market players in the Tiles & Ceramics business. The company has PAN India presence with 289 exclusive showrooms. Its continuing focus on the retail segment by launching a new product in its high margin segment marble & Quartz is expected to drive margins for the company. Improving demand and management guidance further adds earnings and margin visibility of the business. AGL has posted a robust revenue and profitability growth of 15% and 25% coupled with ROCE of 16% and ROE of 13% in the past 5 years. The stock is technically trading at the bottom levels.

Key Drivers: The well-diversified business among government and institutional clientele and the increased focus on the retail business remains one of the key drivers of the business. Moreover. Tiles and ceramic segments are expected to get a boost from the governments initiative to build 20 million affordable houses under PMAY

Financial: In Q3FY19 Net Sales was Rs 296.22 crore Vs Rs. 263.78 crore in Q3FY18 up 12.3% YoY. Net Profit at Rs. 4.63 crore in Q3FY19 down 60.4% YoY from Rs. 11.70 crore in Q3FY18, whereas EBITDA stands at Rs. 24.98 crore in Q3FY19 vs Rs. 36.96 crore in Q3FY18 down 32.41% YoY.

Share Market Tips For March 2019: 1st Week

Ashok Leyland Ltd. (NSE: ASHOKLEY) (Share Price: Rs.87): Avoid

Valuation: Undervalued stock with TTM PE of 13.55x.

Reasons to avoid: Auto sector is experiencing drag down in volume amid low demand. Decline in a volume of M & HCV by 17% led to revenue impact by 15% YoY in the current quarter. Margins are also expected to decline over higher raw material cost and low volume base.

Financial: In Q3FY19, revenue down by 20.7% QoQ and 12.1% YoY. EBITDA margin compressed by 56 bps QoQ and 105 bps YoY. PAT down by 28.2% QoQ and 24.4% YoY.

JK Lakshmi Cement Ltd. (NSE: JKLAKSHMI) (Share Price: Rs.328): Avoid

Valuation: Overvalued with TTM PE of 55.04x.

Reasons to avoid: The company not able to withstand the higher cost of freight and power & fuel cost which results in EBITDA margin compression by 78 bps. Also, higher RM price due to clinker purchase from outside and rise in maintenance cost affected the margin. Meanwhile, short term blip is expected due to elections on ongoing infra projects which can affect demand in peak season.

Financial: In Q3FY19, net sales up 11.7% YoY. EBITDA margin stood at 10.5%. PAT stood at Rs 14.8 crores

CG Power and Industries (NSE: CGPOWER) (Share Price: Rs.37): Avoid

Valuation: Higher valued stock with negative earnings.

Reasons to avoid: The company is posting negative earnings quarter after quarter. The company delivered negative margins in the last few quarters. Promoter holding low and promoters have pledged the entire 100% of their holdings. This is a complete trading stock. Too much volatile.

Financials: The company has posted stable revenue growth in FY18. But growth on the expense side was much higher. The company posted operating margins of -5%. Interest cost is nearly tripled in the last couple of years from Rs. 80 crore to Rs. 220 crore. On the balance sheet side, reserves are going down while borrowings are increasing. Fixed assets are decreasing. Cash flows were negative for the year 2018.

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ABOUT AUTHOR

Niveza Research Desk : We are a team of stock market nerds trying to stay ahead of the herd. We spend our grey cells everyday to a pave a smooth road for our clients in the shaky world of stock market. While tracking the mood swings of the market we bring our clients the most rewarding deals.

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