Kalyani steels - Ready for upside!!!
Kalyani steels(KSL) - CMP 269
Company incorporated in 1973 and it's part of $2.1 bn Kalyani group. It's into leading manufacturing of forging and engineering quality carbon & alloy steels.
Company has both indian & international clients. Some of the noted clients are Tata motors, Ashok Leyland, Jindal saw, Indian railways,caterpillar, Ford,Volvo,etc.
Why it's good buy??
👉 Company has posted good Q2 nos and growth in net profit with increase in profit margin was seen QoQ 💚
👉 Company with zero debt
👉 Steel demand has been increased in the past quarters and continue to increase in the coming quarters due to revived demand in auto sector and also due to increased demand in infrastructure sector which will benefit the company in future earnings. 💚💚💚
👉Being an Indian company, Make in India theme will benefit this company💚💚
👉Book value of the share has been increasing over the past years
👉 Mutual funds and FII have increased their shareholding in the last quarters💚💚💚
👉 Excellent management ( remember the quote , it's better to buy mediocre business with excellent management than to buy a great business with poor management)💚💚
👉 Company at affordable valuation considering its Pe and other valuations.
👉 Company with good ROCE( Return on capital employed) which shows efficiency of the management in utilising the capital for better returns 💚💚💚
👉 Company's major revenue comes from auto segment(80%)and remaining others.💚❤️
👉 Expecting steel demand will be there for the next few quarters💚💚💚
Negative factors❤️❤️
👉 Steel sector is of cyclical nature and there won't be continuous demand for the product. That's the reason why we avoid long term view of the stock.
👉As we mentioned above, company major revenue is from auto sector and concentration is majorly on auto. Any downfall in demand of auto sector lead to affect earnings of the company in great way. However, now there is good demand for auto sector and festival seasons have just started. Hope company may post good Q3 nos.
Apart, from these 2 negative we don't find any flaw in the stock.
Technical view;
On technical front, stock is looking good on charts, weekly breakout has happened with good volumes and sustained ,ready for upside.
Accumulate on dips, 235-245 (good levels to buy, if price corrects)
Short-medium term target - 330-375+
Tips: Buy 50% of your alloted capital at CMP(269) and remaining 50% on dips at mentioned levels. Sometimes, stock will fly, don't worry for that enjoy the ride and use that amount for your next pick.
Company incorporated in 1973 and it's part of $2.1 bn Kalyani group. It's into leading manufacturing of forging and engineering quality carbon & alloy steels.
Company has both indian & international clients. Some of the noted clients are Tata motors, Ashok Leyland, Jindal saw, Indian railways,caterpillar, Ford,Volvo,etc.
Why it's good buy??
👉 Company has posted good Q2 nos and growth in net profit with increase in profit margin was seen QoQ 💚
👉 Company with zero debt
👉 Steel demand has been increased in the past quarters and continue to increase in the coming quarters due to revived demand in auto sector and also due to increased demand in infrastructure sector which will benefit the company in future earnings. 💚💚💚
👉Being an Indian company, Make in India theme will benefit this company💚💚
👉Book value of the share has been increasing over the past years
👉 Mutual funds and FII have increased their shareholding in the last quarters💚💚💚
👉 Excellent management ( remember the quote , it's better to buy mediocre business with excellent management than to buy a great business with poor management)💚💚
👉 Company at affordable valuation considering its Pe and other valuations.
👉 Company with good ROCE( Return on capital employed) which shows efficiency of the management in utilising the capital for better returns 💚💚💚
👉 Company's major revenue comes from auto segment(80%)and remaining others.💚❤️
👉 Expecting steel demand will be there for the next few quarters💚💚💚
Negative factors❤️❤️
👉 Steel sector is of cyclical nature and there won't be continuous demand for the product. That's the reason why we avoid long term view of the stock.
👉As we mentioned above, company major revenue is from auto sector and concentration is majorly on auto. Any downfall in demand of auto sector lead to affect earnings of the company in great way. However, now there is good demand for auto sector and festival seasons have just started. Hope company may post good Q3 nos.
Apart, from these 2 negative we don't find any flaw in the stock.
Technical view;
On technical front, stock is looking good on charts, weekly breakout has happened with good volumes and sustained ,ready for upside.
Accumulate on dips, 235-245 (good levels to buy, if price corrects)
Short-medium term target - 330-375+
Tips: Buy 50% of your alloted capital at CMP(269) and remaining 50% on dips at mentioned levels. Sometimes, stock will fly, don't worry for that enjoy the ride and use that amount for your next pick.
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