Stock Pick: Mukand Ltd

by khalid on 27/09/2011 · 0 comments

Mukand ltd is an arm of Bajaj Group Company which manufactures special steel, stainless steel, Alloy steel and caters it to the engineering, automobile and electrical equipment market segment. They also have a contribution from material handling equipment.

The company has been consistently performing well but the major value erosion has been in the midcap segment which is in a bearish phase from a couple of months.  This stock has the potential to give you 40-50 percent returns in the next 8- 12 months period. Recently the stock has been in news because of a property sale buzz.

We expect this news to be a rumour as the company has 2 plants one in Kalwa & second at Hospet.  We all are aware of the issues in Hopset as these companies are not able to get iron ore for production but the issue has been resolved with the auctioning of iron ore and production by NMDC.

Mukund Ltd has a top line of 300 Cr and its Earning per Share is closure to rupees 4. The company has rich assets and its replacement cost might or might not get monetised. In kalwas they are holding a large chunk of land but it is most unlikely that the company will sell these assets. The operational performance of the company has improved and with the improved production in Hospet plant there is more roof of improvement in bottomline of the company. Considering these factors we are expecting a good return in this stock in the next 8 to 12 months period.

“Bell the bull says: If people are willing to invest in the midcap they can definitely give a bet to this stock.”


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