RIL to stabilise at Rs 800; positive on Crompton: Tulsian

183994 Investors following Reliance. Share this News with them.

0

Like this story, share it with millions of investors on M3

RIL to stabilise at Rs 800; positive on Crompton: Tulsian

In an interview to CNBC-TV18, SP Tulsian, sptulsian.com gives his views on stocks like Reliance Industries, NIIT, JP Infra, Petronet LNG and Crompton Greaves.

Post your opinion here

 

0

Tweet

Share on Tumblr

Excerpts from Closing Bell on CNBC-TV18 Watch the full show » ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets Reliance BSE | NSE 29/05/12 Are Mutual Funds betting on Reliance? Other Stocks in this news NIIT | Jaypee Infratech | Petronet LNG Ltd | Crompton Greaves |

In an interview to CNBC-TV18, SP Tulsian, sptulsian.com gives his views on stocks like Reliance Industries , NIIT , JP Infra , Petronet LNG and Crompton Greaves .

He hopes that RIL will stabilise at around Rs 800. "There are no fundamental reasons for the stocks to rule positive," he added.

NIIT has sold its US unit's entire stake in Element K Corp. According to Tulsian, the deal is positive. But he doesn't think the stock can move beyond Rs 53-54.

JP Infra, he said, has been vastly re-rated. He sees Petronet LNG in a broad range of Rs 160-180 for the next one month.

He has a positive view on Crompton Greaves with a 6-12 months outlook.

RIL Q2 results: What analysts and investors did not like

Below is the edited transcript of his interview with Udayan Mukherjee and Sonia Shenoy of CNBC-TV18. Also watch the accompanying video.

Q: NIIT has sold its US unit's entire stake in Element K Corp, a step-down subsidiary, to Ireland-based SkillSoft for USD 110 million. How much more of an upside do you expect on the stock?

A: It is definitely a positive deal. It will largely de-leverage the books of the company. I don't think that there is much upside left in the stock. I don't think that it can really move beyond Rs 53-54.

Now, it is ruling at close to about Rs 50 because of the positive bias or the renewed buying interest coming in the stock. But I don't think that this will really sustain beyond Rs 53-54.

Q: JP Infra has been rallying on the back of F1 coming on board, end of October. Is it just exuberance on the stock or is this something more concrete to it?

A: I don't think that this is exuberance. If you see their land parcel, they have about 1,250 acres at Noida and about 2,500 acres at Gautam Budh Nagar. If you take the aggregate land holdings with the company, it's close to about 3,600 acres. Out of that, I think they have only sold about 600-700 acres in this last couple of years.

In the recent past, in the last three months, we have heard that there has been a sharp increase in the land prices. The value per square meter in the Noida Expressway Development Authority area is ruling close to about Rs 14,000-15,000.

If you apply the same kind of valuations or even if you take half of that Rs 7,500 per square meter for the entire remaining land parcel, that gives a value of over Rs 10,000 crore. The entire land is ready for development. Apart from that, their expressway will be fully operational by April 2012, ahead by about one year or so.

Considering the present market cap of over Rs 8,300-8,400 crore, and the company judiciously has been realising Rs 1,500 crore net profit every year, probably the stock has been vastly re-rated. We have been seeing some informed buying. With a very low public float of about 8-9%, this informed buying has taken this stock to move up.

Q: Where do you see Reliance Industries stabilising now?

A: During the day, I was expecting that it will fall to Rs 840-845. I think it will touch about Rs 800. I don't think it will rule strong by expiry. I hope that it stabilises at around Rs 800 because there are no fundamental reasons for the stocks to rule positive. I see the stock in a range of Rs 800 to Rs 840 till the expiry.