Fabulous 15

A K Prabhakar – akprabhakar.equity@gmail.com

fabulous-15 ->
stocks for Year 2010
After smashing success of previous lists – COMPACT 15, QUICK15+6,
SOLID-15, FANTASTIC-15, VALUE-24, ARG 30 I recommend a new list of
stocks chosen with great care after markets have given more than 80% returns and
some of our stocks giving more than 300% gains. The stocks chosen are included
as they provide Value and a good margin of safety. Year 2010 in my view would
give negative returns on Index basis and individual stock performance would be
brilliant. So we must divide the risk equally and 20-30% returns annually would
also be very good given stretched valuations for our markets when Nifty trades
above 23 P/E and world interest Rates near zero. Indian economy is expected to
clock GDP growth near 8% but a Fast-growing economy has its own pitfalls like
inflation which we are already facing and supply constraints also can lead to
market correction. This list I present to you to use on investment basis to
accumulate over 1-2 year period and it would be a golden opportunity if broader
markets correct even 10-15% from current levels.

http://akprabhakar.blogspot.com http://tanmaygopal.blogspot.com http://prabhakar-views.blogspot.com


fabulous-15
Stock Name Current Market Price (Rs) Target (Rs)
3IINFOTECH 87 118
ABGSHIPYARD 210 270
ADHUNIK MET 110 152
EMCO 91 130
GIC HOUSING 92 150
GLENMARK 278 350
GREAVES COT 286 352
GSPL 98 125
GUJ NRE COKE 80 110
IFCI 54 75
MRPL 78 100
NEYVELILIG 152 196
POWERGRID 109 141
SKUMAR 41 70
SUZLON 91 140


3i iNfotecH
CMP Rs 87
Target Rs 118

3IINFOTECH is a global Information Technology company which
provides technology solutions to over 1,500 customers in more than 50
countries across 5 continents, spanning a range of verticals - Banking ,
Insurance , Capital Market , Mutual Funds , Government, with 8% of
the revenue coming from ICICIBANK. RBI guidelines suggest banking
companies holding not more than 5% stake in non-core activities and
ICICI bank holds controlling stake in 3i Infotech. Talks for acquisition
of ICICI Bank Ltd’s controlling 27% stake in 3i Infotech Ltd have
veered to a likely price range of Rs 110-120 a share, sources told
NewsWire18.



abG sHiPYarD
CMP Rs 210
Target Rs 270

Largest Private Sector Shipbuilding Yard in India Certified by DNV for
ISO 9001 - 2000. The shipyard has delivered 104 specialized and
sophisticated vessels. 90% of the vessels built in last two years were
exported. The company has Order in hand over Rs. 12,500 crores
which are to be serviced until 2014. The company is investing 16 billion
rupees to build a new facility at Dahej in the western state of Gujarat.
The facility will include a unit to build jackup oil rigs. "About 85% of the
facility is complete," he said, adding that the entire facility including a
new ship lift should be ready by June.



aDHuNik Metalik
CMP Rs 110
Target Rs 152

ADHUNIK METALIK is an integrated special steel producer and iron ore
miner. It is venturing into the power business through its subsidiary, APNR.
Adhunik Metalik is flagship company of the Adhunik group and engaged in the
production of value Added Steel, Alloy Steel and Stainless Steel products
catering to the automobile, construction engineering and household industry.
The Company strongly focuses on reduction of production cost and zero waste
management. Adhunik will be merging group companies Vedvyas and MP
Ispat, which will bring 120,000tpa of coke oven capacity and 120,000tpa of
sponge iron capacity. Consolidated profits may grow by more than 50% CAGR
in the next 3 years to 2012 on account of growth in steel production and iron
ore mining. The company has raised capital from QIB as well as promoters and
debt-equity ratio may go below 2 in March2010 from 4.9 in March 2009.
Adhunik’s captive iron ore mines in Orissa have received environmental and
forest clearance. Final mining lease is expected soon. Margins are likely to
expand due to significant savings.



eMco
CMP Rs 91
Target Rs 130

EMCO offers Transmission and Distribution solutions in Power Sector. It
is amongst top 3 transformer companies in India with 20000MVA capacity.
Order Book at 30 Sep 2009 was Rs 1600Cr and company plans to double
transmission tower capacity from 45000MT to 1 lakh MT. India is
expected to add a generation capacity of 62000MW on certainty basis in
11th Five-year plan and against this the country has added just 14337MW
in first two and half years ending Sep 2009. Thus to capacity to be added in
the remaining two and half years will be over 45000 MW. This translates
into a capacity addition of about 19000 MW per annum.



Gic HousiNG fiNaNce
CMP Rs 92
Target Rs 150

GIC Housing Finance Limited, was promoted by General Insurance
Corporation of India and its erstwhile subsidiaries namely, National Insurance
Company Limited, The New India Assurance Company Limited, The Oriental
Insurance Company Limited and United India Insurance Company Limited
together with UTI, ICICI, IFCI, HDFC and SBI. GICHFL has presence in 27
locations across the country for business. Housing being the one of the
essential needs of mankind, the demand for shelter grows in line with the
increase in population and the standard of living, hence the need of financing
the purchasing of a House came up. A growth stock with one of the best
Dividend Yields in Indian stock market!



GleNMark
CMP Rs 278
Target Rs 350

Glenmark Pharmaceuticals Ltd is a research-driven, global, fully integrated
pharmaceutical company which employs over 4100 people across its global
operations. The Company is a leader in India in the discovery of new molecules
(Both NCES and Biologics) and is focused in the areas of inflammation
[Asthma/COPD, etc] and metabolic disorders [Diabetes, Obesity, etc]. The
Company has branded generic formulation interests in over 95 countries across
the world including India, Europe, Brazil, Rest of Latin America (excluding
Argentina), Russia/CIS, Africa and Asia. Glenmark Generics Limited (GGL), is a
subsidiary of Glenmark Pharmaceuticals Limited (GPL) that aims to be a global
integrated generic and API leader. GGL has an established presence in North
America, EU and Argentina and maintains marketing front-ends in these
countries. GGL has a strong base in Formulations development with teams
operating out of laboratories in India and Latin America. GLENMARK has
announced plans of IPO for Glenmark Generics which would benefit the parent
company.


GreaVes cottoN
CMP Rs 286
Target Rs 352

Greaves Cotton Limited, established in 1859, is one of India's leading and
well-diversified engineering companies. It manufactures a wide range of
industrial products to meet the requirement of core sectors in India and
abroad. The company's core competencies are in Diesel/Petrol engines,
Gensets, Agro Equipment and Construction Equipment. Recently the
company forayed into earth-moving with the launch of its Wheeled Loader
CG 932 H. It has also tied up with Mitsubishi Heavy Industries Limited,
Japan, to market its range of Motor Graders in India. Greaves Cotton,
presently, is the only Indian manufacturer to offer a range of products in
concreting as well as compaction segment. With the inclusion of these two
new products in the earth- moving segment, it will have an exclusive position
as a supplier for the contractors involved in road building, irrigation and other
infrastructure development projects.



GsPl
CMP Rs 98
Target Rs 125

GSPL, a GSPC subsidiary, has taken a lead in developing energy transportation
Infrastructure in Gujarat and connecting major natural gas supply sources and
demand markets. Gujarat State Petronet Limited is first company in India to
transport natural gas on open access basis and is a Pure Natural Gas
Transmission Company. The transmission network of the company envisages
development of systematic and seamless pipeline network across Gujarat
connecting various suppliers and users. The suppliers of natural gas include
traders, producers and LNG terminals. The users comprise industries such as
power, fertilizer, steel, chemical plants and local distribution companies. The
Indian natural gas market is relatively underdeveloped compared to other
regions of the world. By the years 2024 to 2025, the share of natural gas would
increase to 20% of total primary energy consumption, according to
Hydrocarbon Vision 2025.



GuJ Nre coke
CMP Rs 80
Target Rs 110

Coal is becoming a precious commodity day by day because of scarcity of the fuel
and Gujarat NRE Coke is the largest independent producer of Met Coke in India
and is the only Indian company with coking coal mines in Australia having more
than 500 million tons of Metallurgical Coal with excellent coking properties. The
company is set to emerge as one of the largest coking coal producers in Australia
over the next few years. The coal mines are owned through its subsidiaries –
Gujarat NRE Minerals Limited (ASX:GNM). The company has 87.5 MW wind
power energy and has also set up mini steel mill in Gujarat to recycle steel scraps
using green wind energy to manufacture TMT Bars.



ifci
CMP Rs 54
Target Rs 75

IFCI was established in 1948 by Government of India to cater to the long-term
financial needs of the industrial sector. But because of inefficiency the company
felt severe drop in performance but now Government of India is trying hard to
get the organization back on track as it holds Rs 523 Cr of optionally
convertible debentures in IFCI but no stake, largest stake holder is LIC with
8.39% holding. News reports say that the government may appoint a consultant
to rejig IFCI's business operations soon and the stock is a good investment at
current levels. IFCI holds more than Rs 1200Cr value of equity shares in
various listed companies along with important stakes in many unlisted
companies which would give it a fair valuation if the company gets sold or
merged into some other company.



MrPl CMP Rs 78
Target Rs 100

MRPL is a State of Art Grassroot Refinery at Mangalore and is a subsidiary
of ONGC. The Refinery has got a versatile design with high flexibility to
process Crudes of various API and with high degree of Automation. MRPL
has a design capacity to process 9.69 million metric tonnes per annum and is
the only Refinery in India to have 2 Hydrocrackers producing Premium
Diesel (High Cetane). It is also the only Refinery in India to have 2 CCRs
producing Unleaded Petrol of High Octane. MRPL has been running its
refinery at a sustainable 125% utilization level since FY05, one of the highest
among domestic peers. MRPL is increasing the capacity of its refinery to
300,000 barrels per day from 193,800 barrels at an investment of Rs 12,400
crore. The stock looks great on technical charts and with strong management
like ONGC as parent the company is expected to outperform in near future,
negligible net debt/equity ratio would help ease debt burden of Rs 10000Cr
needed for expansion.



NeYVeli liGNite
CMP Rs 152
Target Rs 196

The main core activity of NLC is Lignite Excavation and power generation using
lignite excavated. Lignite is the younger offspring of the coal family. It is a fossil
fuel belonging to the Miocene age (25 million years). NLC is having three lignite
mines, also raw lignite is being sold to small scale industries to use it as fuel in
their production activities. NLC is generating power in its Thermal Power Station
I, Thermal Power Station -II and in Thermal Power Station I Expansion. All the
southern states are beneficiaries of this power generation project. Today NLC
Power Stations are generating about 2490 MW of Power. NLC's Power Stations
are maintaining very high level Plant Load Factor (PLF) when compared to the
National average. Disinvestment can improve liquidity for the stock and avaiablity
of raw meterial is a concern which NLC has in plenty.



PoWer GriD corPoratioN

CMP Rs 109
Target Rs 141

POWERGRID, a Navratna Public Sector Enterprise, is one of the largest
transmission utilities in the world. POWERGRID wheels about 45% of the total
power generated in the country on its transmission network. It has a pan India
presence with around 71,500 Circuit Kms of Transmission network and a total
transformation capacity of 79,500 MVA. POWERGRID has also diversified into
Telecom business and established a telecom network of more than 20,000 Kms
across the country. POWERGRID has consistently maintained the transmission
system availability over 99% which is at par with the International Utilities. The
stock has remained considerably silent given run-up in the market and is a value-
buy at CMP.


skuMar NatioNWiDe
CMP Rs 41
Target Rs 70

SKNL is one of India’s leading textile and apparel company with expertise in multi-
fiber manufacturing. The company has extended its presence in multiple product
categories from Fabrics to Apparels and Home Textiles. From a turnover of Rs.5
million in 1948, today, the group has come a long way in achieving a turnover of Rs.
17 billion. Brands include popular names such as Reid & Taylor, Belmonte,
SKumars, Carmichael House and Stephens Brothers.



suZloN CMP Rs 91
Target Rs 140

Conceived in 1995 with just 20 people, Suzlon is now a leading wind power
company with over 14,000 people in 21 countries and operations across the
Americas, Asia, Australia and Europe. It is now a Market leader in Asia and 3rd
largest wind turbine manufacturer in the world, Suzlon Market Share (Combined
with REpower) rose to 12.3% thereby making Suzlon 3rd largest wind turbine
manufacturing company in the world. India is a power deficit country and the
traditional sources of power are dwindling with reducing reserves of coal and water
shortage. India would be betting on renewable and alternate sources of energy like
Wind Power and nuclear power to grow on a sustainable basis. Already
government of India has declared subsidy scheme for Wind Power companies-
Wind power projects will be given 0.5 rupee for each unit of power fed into the
grid with a ceiling of 6.2 million rupees per MW for a minimum 4 years and
maximum 10 years. The incentive would increase the internal rate of return of
projects by at least 3-4% which would give way to more orders for large players like
SUZLON.



tHaNk You
&
HaPPY iNVestiNG!
Disclaimer:
This represents views based purely on Technical, Fundamental, news, data and event based studies. The
information and views presented in this report are prepared by A K Prabhakar. The information contained
herein is based on my analysis of the Charts, Company Announcements and upon sources that I consider
reliable. I, however, do not vouch for the accuracy or the completeness thereof. This material is for
personal information and I am not responsible for any loss incurred based upon it. The investments
discussed or recommended in this report may not be suitable for all investors. Investors must make their
own investment decisions based on their specific investment objectives and financial position and using
such independent advice, as they believe necessary. While acting upon any information or analysis
mentioned in this report, investors may please note that neither A K Prabhakar nor any person connected
with him accepts any liability arising from the use of this information and views mentioned in this
document. A K Prabhakar and his affiliates may hold long or short positions in the above-mentioned
companies from time to time. The report is intended for a restricted audience and I am not soliciting any
action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an
invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related
to such securities.


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