Top Five All-Around Value Stocks

(medium term perspective)

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Vadivelu

In this article let us analyze 5 India stocks which are technically bullish
for the medium term. The discussion is based on weekly charts.

Indraprastha Medical Corporation (Group: B1, Scrip Code:

532150):

Indraprastha Medical Corporation is the holding company for Delhi

based multi-speciality Indraprastha Apollo hospitals, a joint venture
between Apollo Hospitals and Government of Delhi. It specializes in
cancer, cardiac, neuro surgery, radiology and paediatrics. It earned a
net profit of Rs.14.7 crores for the financial year 2006 – 07.
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This stock recorded a high price of 54.90 in July 2005. Since
September 2005 it has been on a downtrend. It formed its first higher
low of 25.40 in March this year with the first wave ending at 36.35 in
June. This week, it broke this resistance and closed above it with good
volumes. The stock is expected to test its previous high at 54.90 in the
medium term.

Indus Ind Bank Limited (Group: A, Scrip Code: 532187):

We discussed this stock in my previous article, “Hot or Not? Private

sector banks on a roll!”. This bank is the brainchild of Srichand
Hinduja, a non resident Indian businessman. Ashok Leyland Finance
Limited, a leading hire purchase and leasing finance company merged
with the bank in 2004. It declared a net profit of Rs.68.22 crores for
the financial year 2006 – 07.
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We discussed about the stock struggling to break its previous high at

64, even though it was making higher highs and higher lows.
Ultimately, the breakout was achieved this week, with the stock closing
at 65.90. The level of 64 could not be broken for more than a year.
Now that the stock has overcome the strong resistance, we can expect
the stock to test its previous high at 83.90 for the medium term.

Navneet Publications (India) Limited (Group: B1, Scrip

Code:508989):

Navneet Publications is engaged in the publishing of educational

books. The books list includes high quality books, supplementary
books like guides and question sets in four languages, English, Hindi,
Marathi and Gujarati. Navneet also produces various titles in the
children and general books category, which are not based on syllabus,
such as activity books for children, health series books, cookeries, etc.
Navneet declared a net profit of Rs.43.5 crores for the financial year
2006 – 07.

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Navneet Publications has not seen much action in the stock market in
the last 16 months. Just before the May 2006 collapse it registered a
high of 70. It attempted to break this level in September 2006 but
failed. This week, almost after one year, it has broken out with good
volumes and closed at 77.80. The previous high at 70 should now act
as a strong support for the stock. So, any decline in the stock should
be used to accumulate or enter. The medium term target for the stock
works out to 108.

Sabero Organics Gujarat Limited (Group: B1, Scrip Code:

524446):

Sabero Organics manufactures agrochemicals such as

formulations/active ingredients and speciality chemicals/intermediates.
The company exports its products to over 50 countries covering
Australia, Asia, Africa, Europe, Middle East and the Americas. In order
to facilitate the registration of its products and provide better customer
service, the company has recently set up subsidiaries in Australia,
Argentina, Netherlands and Brazil. The company’s net profits were
Rs.0.41 crores in 2006 – 07 as compared to Rs.3.1 crores in 2004 – 05.
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The stock had been on a downtrend since last 2 years after hitting a
high of 43.30. It however, found support when it reached a low of 9.85
in July last year. It was consolidating for a year since then. This week,
it has managed to close above its previous high at 17.35 with more
volumes than its previous peak. The stock’s target for the medium
term works out to 30.30, which was its previous high and also 61.8%
retracement level from a high of 43.30.

Zuari Industries Limited (Group: B1, Scrip Code: 500780):

We discussed about Chambal Fertilizers and Chemicals Limited, a K.K.

Birla group company in my earlier article, “Buy These 5 Stocks and
Forget about them”. Zuari Industries Limited (formerly Zuari
Agrochemicals Limited) is another K.K.Birla group company. Zuari
opertaes a nitrogeneous fertilizer plant in Goa, with an installed
capacity of 946,200 metric tonnes. It comprises a single stream
ammonia plant, a urea plant, an NPK plant and a DAP plant along with
related on-site and off-site facilities for handling raw materials end
products as well as the generation of steam and captive power. It
declared a net profit of Rs.419 crores for the financial year 2006 – 07.

The stock last heavily during last year’s huge correction between May
and June i.e. it fell from a high of 364 to a low of 128.50 (about 65%)
loss. It bounced back and made a high of 248.40 in January 2007. But
once again, it fell back near its previous support levels.
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Last week, it managed to break its previous resistance and closed

above it with more volumes than the previous peak. More importantly,
it managed to close above 61.8% retracement, which is a strong
resistance level while pull back. The stock may be expected to reach
364 in the medium term, which was its previous high and another
major resistance.

Sundaramurthy Vadivelu

LABELS: MEDIUM TERM PICKS, INDRAPRASTHA MEDICAL

CORPORATION, INDUS IND BANK, NAVNEET PUBLICATIONS, SABERO
ORGANICS, ZUARI INDUSTRIES

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