Medium Term Pick - Suprajeet Engineerig Ltd

• Suprajit Engineering Ltd. (SEL) is a market leader in Automotive Control Cables for the 2-wheeler segment with a 60% market share besides holding a 40% market share in the 4-wheeler space.Ramson (competitor co.) sales were 1.5x SEL sales in FY02 but in FY14 SEL sales were 5x that of Ramson’s.

• The company has been able to maintain its high market-share as a result of better cost competitiveness versus peers , due to its production proximity to its OEM customers.
• The company continues to target growth of 5% to 10% above the industry growth, buoyed by new product introduction in the aftermarket segment (both independent & OES route) and export growth ( 30% cost advantage over global peers).
• Company has received approvals from marquee customers like BMW, VW, John Deere etc and supplies small quantities to them, which has potential to grow exponentially.
• SEL has planned INR 65 cr capex each over the next 2-years for its 3 facilities, which will increase capacity to about 200-225 million cables.
• A faster–than-industry growth rate resulting in better market-share, cost competency versus peers and healthy ROCE of 38%, will augur well for the company going forward.

We recommend medium term Buy @ CMP of 135-140

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Short Term Pick -UCAL Fuel Systems

UCAL Fuel is in the Auto Ancillaries sector. The current market capitalisation stands at Rs 282.28 crore.The company has reported a standalone sales of Rs 141.68 crore and a Net Profit of Rs 5.34 crore for the quarter ended Dec 2014.

Pros:

- Stock is trading at 0.95 times its book value

- Company has been maintaining a healthy dividend payout of 27.50%

The Company is expected to give good results for this financial year and keeping this in mind you can buy cmp@125 for a target of Rs.150-160 in the short term

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Medium term pick - Srikalahasthi Pipes - Mint in tonnes

Lanco industries was incorporated in the year 1991. It has two main products - pig iron and slag cement. Commercial production at the pig iron plant in Tirupathi started in Sept. 1994.

Capacity utilisation is 95.4% of rated capacity for 1996-97. The company's captive power plant was commissioned in Feb 1995. For the year 1996-97, the company produced 24.8 MW internally which was 88% of its total consumption.

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Short Term -Buy Ybrant Digital

Ybrant Digital has posted a decent results

Inspite of the results, the stock has fallen sharply due to some rumor from Rs 44 to Rs 33 in one steep

But the management had clarified the issue and now it started its upmove

In this scenario you can buy Ybrant Digital @34-35 for a target of ₹50 in the short term

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