PSUBank : public Sector Banks (PSBs) are banks where a majority stake (i.e. more than 50%) is held by a government.
SBIN : cmp: 250 : We have already talked last quarter that : After getting merged Sbin will be having 24000+ branches managed by 2.8 Lakh employees & 4.2 crore client base which is approximate population of Canada. Market share in India is 23%. Npa will be increased from 9% to 10% after Merger & NIM will be decreased. Merger will be done till sept end 2018. 1160 crore/annum will be saved due to merger. Around 10,000 employees will be redeployed to sales to increase business due to merger and net rs. 400 crore/annum will be saved due to VRS 3600 employees. Current year results are as expected as profits has been affected due to high NPA increment from 3.7% last year to 5.73% this year. Revenue was flat (1% higher) and Net Profit has decreased by -972% as bank has booked loss of 4200cr which was higher than loss of 390 cr previous year. As high provisions has done last year. Highest number of Npa has been seen in Midsize corporate 26%, largest corporate 13% and SME with 12%. Agri Npa are lowest comparing to corporates and best are Retail loans with just 1.6% Npa. India moving from cash to digital as 80% of the Total transactions done in Sbi during last year were out of the Branch transactions. Sbi with highest number of followers across all banks in world in facebook. As we have already said during last year that This year may be the starting point of the new era for Sbin. As many of you are already holding this bank since 145 last year when news were not good. Our expected target was 350 and sbi has just hit 350. Profit could be booked around 15% and remaining 85% can hold for further wealth creation was recommended. New Buying again can be done near 183 and can hold it for long term wealth creation.
MOtilalofs : Cmp: 955 : A very good company among Stock broking business. Current year Revenue has grown by 59% and Net Profit has grown by 49% as expected and in stream since last year. Price has already rallied as many of you have bought last year near 450. At cmp it is trading expensive, so new buying can again done near 800 with the next 4-5 years target of 2944. Good company for long term investment. Motilal is able to increase its Profit of 20 cr since 2008 to today 540 cr annually. Definitely a wealth creator stock. We are already +ve on this whole industry.
Other Financial Services : With growth of about 20% CAGR in this industry.
CARE : Cmp: 1305: CARE is a very good company for long term wealth creation. A growing Debt free, High R-O-E and with Good margins. Recent growth is muted as current year revenue has grown by 12% and net Profit by 3%. Considering a long term buy we can buy this company in the whole range of 1103 to 937 and target for next 2 years should be 1692. Should be in the list of wealth creator stocks.
Pharma:
Bliss Gvs : cmp 180 : Many people in this group hold this wonderful pharma company since last 3 years bought at 60. Some again bought at 88 and are still holding. Overall Pharma is not in growth since last 3 years. Bliss was making revenue and profit of 3Cr and 33 Lakh during 2001 and today able to generate revenue and profit of around 300 cr and 90 cr respectively. Have good margin and high R-O-E. Current year growth is muted as revenue and profit are +3% and -18% respectively. New buying again can be done in the range of 140 to 115 and target for next 3 years should be 310. FII named Fidility just bought in feb 4 Lakhs shares at 200.
Disclosure do Not buy or sell before consulting your advisor as writer may have position in above given stocks.
