I first recommended Zee Media when it was at Rs 18-19 is now is at Rs 34. In Zee Media, there are two triggers. First is the hiving off of the printing business. Now, the company, has a couple of days back, proposed that they will be demerging the print business. That means DNA paper is getting hived off and that is a loss making venture.
They have a very healthy bouquet of news channels, which are making profit. To give an example, earnings before interest and taxes (EBIT) of Rs 27 crore, from the news channels are eaten away by the losses of about Rs 10 crore from the print business. So, the management has decided that they are restructuring the company, hive off this print business in which those who are holding four shares will get one share of print business or maybe in due course of time, the company will think of exiting from the print business as well. Because they have all been struggling in this venture for last over one decade. That is one trigger which I see very positive.
The second positive trigger is the company is launching a home shopping channel. Now if you see this home shopping channel, when you talk to the industry experts, they say that this is a proxy to e-commerce, and is really a sunrise industry. So, these are the two things.
Already we have seen a huge positive earnings coming in from this company. If you see, in the first half, the turnover of about Rs 205 crore in the TV business, company has made an EBIT of Rs 27 crore. Taking all this into consideration, the strong bouquet of the news channels, I think that stock which is now ruling at Rs 34 can give you a return of anywhere between 50-100 percent by next Samvat. I am not setting the aggressive targets, but look for a return of 50-100 percent by next Samvat.
I have three stocks for the medium term. First is Ashok Leyland . It has gone through a bad time. It now looks like it had a good month end. It is probably bottoming out. So, that is a buy with a stop loss around Rs 80. And a medium-term target of about Rs 120.
Similarly, Britannia which had a fairly strong run, last two or three months has been sideways. Now fast-moving consumer goods (FMCG) seems to be bottoming out. So, that is a buy with a stop loss of Rs 3,200, look for Rs 3,750.
And a beaten up, forgotten stock is Bata . Maybe things are not good with the company, but it is down from Rs 750 to around Rs 450-500. So, this is a time to get into it. Whenever good results come in, you could easily make a lot of money. So, Bata is a buy with a stop loss of Rs 450 and look for targets of Rs 620.
The first is NMDC . This now represents metals. Metals are just entering a bull market. It is not done. It is just the beginning. So, NMDC represents that entire sector. I also have some investments in it and I think it is a good idea to buy and hold for a longer term of time.
The second is IDFC . If you add up IDFC and IDFC Bank, the prices have been in a trading range for years altogether. This is one of the last banks to break out of that trading range and as a holding company, probably do very well. So, IDFC is my second buying idea. It is in the financials business which is likely to outperform.
The third is Bharti Airtel . Bharti Airtel has been in a trading range since 2007. This is 2017 almost. So, for 10 years, it has done nothing. It is a matter of time before it rallies and when it rallies, the eventual target should be Rs 600 plus. Just be patient. Patience is of course necessary for any investing idea to be profitable.
And the last of my suggestions is more of a speculative stock that is India Cements . India Cement has come out of a trading range which has lasted for many years. Significant rallies are likely to come in this, but remember, I always prefer conservative stocks rather than speculative. So, three solid growth ideas and one India Cement. But be long in this market. Ensure that your money is in these stocks. This market is going much higher.
I have some short terms calls. A buy on Kotak Bank . That is the one stock which is now showing very promising pattern on the short to medium-term chart. It is just on the verge of breaking beyond Rs 820-825 which it never traded above, so buy it above Rs 822 with a stop at Rs 809. The first port of call should be Rs 850 though I suspect eventually this is a stock which should get past Rs 900 from a trading point of view.
Then the other short-term call is a buy on Ajanta Pharma with a stop at Rs 2,014 for target of around Rs 2,095. I have one sell call in the short term that is on Eicher Motors . That is a sell with a stop at Rs 24,360 for targets of Rs 23,500.