Hidden gems for your portfolio

CNBC-TV18 has analysed over 4,000 small and midcap companies, to find some with low PEs, high dividend yield, price to book value of less than 1, positive cash EPS and good profit growth.
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Nov 22, 2007, 05.38 PM | Source: CNBC-TV18

Hidden gems for your portfolio

CNBC-TV18 has analysed over 4,000 small and midcap companies, to find some with low PEs, high dividend yield, price to book value of less than 1, positive cash EPS and good profit growth.

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Hidden gems for your portfolio

CNBC-TV18 has analysed over 4,000 small and midcap companies, to find some with low PEs, high dividend yield, price to book value of less than 1, positive cash EPS and good profit growth.

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CNBC-TV18 has analysed over 4,000 small and midcap companies, to find some with low PEs, high dividend yield, price to book value of less than 1, positive cash EPS and good profit growth.

 

The first pick is Veejay Lakshmi Engineering Works . The price to earnings ratio is about 3.8 times. Comparatively, if you look at it relative to its peers, it is trading at around 14-15 times. It is a very small company in that sector. It can be compared to Lakshmi Machine Works , which is also in that sector.

 

Its price to book value is at 0.7 times or 70% after book value. The book per share is about Rs 140 per share. Its dividend yield is 2.2%. The Sensex stocks’ dividend yield, as a component, is less than 1%. This is for long-term investors and small retail investors. Its EPS is about Rs 25 and cash EPS is about Rs 32.

 

With regard to institutional activities, two FII s hold about less than 1%. There seems to be some technology JV out there.  With respect to performancewise sales growth, we have seen 40% growth on this counter and PAT growth is about 16%. The 52-week underperformance to the Sensex is close to about 45%.

 

The second pick is Sirpur Paper Mills , which is in the paper industry and a small company again. The price to earnings ratio is about 4.5 times and relative to the sector it is about 8-9 times. The price to book value is again 0.65 times and 65% of the book. The book value per share is about Rs 132 and the dividend yield is 4.1%. EPS is about Rs 19 and cash EPS is about Rs 27.

 

IL&FS Investsmart holds more than 4% and LIC , GIC hold about 7% on this counter. Performancewise, its sales growth is13%. The 52-week underperformance to Sensex is close to about 35%.

 

These are stocks based on the 5-6 parameters put together. There may be relative underperformance in the short-term, but over the long term, these are stocks to watch out for, especially in volatile times such as this. 

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