United Phosphorous : Buy

Nov 17th 2009
Tags: Stock Ideas

Company Name- United Phosphorous
Recomendation- Buy Around Rs 130 – Rs 140.
Stop Losss- Rs 125
Target- Rs 180 – Rs 200
Potential Return- 30% To 40 %

Company Info- United Phosphorus Limited (UPL) is a pesticides and seeds producing company. The company have 21 subsidiaries to manufacture pesticides (crop protection products), specialty chemicals, intermediates and other industrial chemicals. The product portfolio of the company includes insecticides, fungicides, herbicides, fumigants, PGR and rodenticides. The company conducts its business in three segments, Agro Chemicals, Speciality Chemicals and Industrial Chemicals.

Basics
ISIN Id – INE628A01036
BSE Id – 512070
NSE Id – UNIPHOS
Industry – Chemicals
Market Cap – Rs 6542.90 crore
Book Value – Rs 41.35
Face Value – Rs 2.00
P/C – 33.68
Dividend (%) – 75.00 (%)
Div. Yield (%) – 1.01 (%)
P/E Ratio– 62.02
EPS – Rs 2.40

Stock Price History
All Time High – Rs 1015.00
All Time Low – Rs 71.50
52 Week High – Rs 185.35
52 Week Low – Rs 71.50

Recommendation-
United Phosphorous was under an intermediate trend which exactly in the opposite direction of the major uptrend. This correction qualified as an intermediate one , both in terms for price (more than 20% and time (more than 3 weeks) and in this due course price corrected from Rs 180 to below Rs 140 levels. Finally the price found the support at the older tentative trend line (which turned out to be a valid trend line now).We expect the stock to move in this fresh channel now for next few months and hence recommend a Buy on the counter around these levels with a closing stop loss below Rs 125 , for a target of Rs 180 – Rs 200.