Undervalued picks in supercharged mkt

With markets inching towards 13k and Diwali making its way, investors can celebrate both by taking a look at the stocks mentioned below for a longer term gain perspective.

Some of the well known stocks of companies like Arvind Mills,Century Enka, Dena Bank, Essar Shipping, Gujarat Inds Power,IDBI, Ind-Swift Labs, Jindal Poly Film, MTNL, Mascon Global, Nagarjuna Fertiliser, Sakthi Sugar, South Ind Bank, Tele Data Infor, UCO Bank, Uttam Galva, VisualSoft Tech, that are listed on BSE 500, are all trading lower than their book value, BV.

And if we take the total listed companies, there are as many as 1861 companies out of the total 4508 companies on the BSE that fall in the same criteria.

Book value is based on the value of total assets less the value of total liabilities. This is the amount that the shareholders would receive if the company were to be completely liquidated.

A company with BV more than its market price is considered to be undervalued and are treated as great value pickd. Book value also can be used as a benchmark to understand by how much a strong performing company’s stock can fall if market turns its back on it.

It seems midcaps are making themselves known as undervalued stocks because the above-mentioned stocks are the only stocks listed on BSE 500 whose BV are more than their market price and they fall in the midcap category. And to top that amongst the total listed companies, 531 companies are again midcaps.

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