Suzlon may reduce losses in July-Sept quarter: Tulsian

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Suzlon may reduce losses in July-Sept quarter: Tulsian

In an interview with CNBC-TV18, SP Tulsian of sptulsian.com, speaks about stocks/sectors that have been in news off late.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Mkts may test highs over next 6 months: fullermoney.com Capital goods will push markets up: Anand Rathi Find out: Why Brics Sec is bullish on small cement cos Banks, pharma, auto, FMCG rally to pause: Fortune Fin 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

As markets look vulnerable, there is a concern among investors on the next move. SP Tulsian of of sptulsian.com, speaks about stocks and sectors that have been in news off late.

In an interview with CNBC-TV18, SP Tulsian says he is negative on cement sector and bearish on stocks like ITI , Assam Company and Suzlon Energy .

Tulsian explains that there are some problems in Assam Company because of the overseas partners' litigations.

He elaborates that however the kind of losses Suzlon posted in Q1 was scary, it is likely to get reduced in July-September quarter. In short-term, till mid of October, he expects Suzlon to move back to Rs 55-56. "In the long-term, you cannot take a positive call on the stock, " he adds.

Here is a verbatim transcript of the exclusive interview with SP Tulsian on CNBC-TV18. Also watch the accompanying video.

Q: How worried would you be on Hindustan Construction , a stock which corrected last week on account of all this talk of Lavasa, the lease being opened up for scrutiny once again?

A: Definitely you have concern because earlier also the valuation of Lavasa was not properly reflected into HCC. Then there was problem on the working of the company, maybe margin depression and the losses having made in Bandra Worli Sea Link and all that.

I don't think that this is a big concern. But this can definitely delays the process of unlocking the value from the Lavasa initial public offering (IPO). If you have this kind of news flows coming in, definitely that has a negative impact on the parent company.

Q: Anything you like or track in midcap cement, last week they were all up on hopes that prices are going up?

A: Overall, my view is not very positive on the cement sector. But the two stocks; one is Gujarat Sidhee Cement and second is Andhra Cement , these two are seen as a potential takeover candidate. Whenever you take a call, if you go by their valuation by the present marketcap, for instance, Gujarat Sidhee Cement, it's a debt free company having value per tonne at USD 40.

Same thing is happening with Andhra Cement also. Sometimes you hear from the sources that probably the promoters are asking much more than what they have all been ruling at. Except for that, I don't think that there is anything positive for these midcap cement stocks because margins are going to remain under pressure due to the huge capacity addition, which is likely to be about 50 million tonne, in next six-eight months time.

Q: What would you do with ITI at Rs 44; they just bagged Rs 230 crore orders from BSNL?

A: I never had comfort with this stock inspite of the order flows and maybe some relief coming from the government. In the past also the company has tried to sell some of its divisions; three divisions have been put on the block. But the kind of losses the company is making, I think these are maybe frequent or sporadic rise in this stock maybe at a frequent interval either on the news of financial restructuring or financial assistance or the order inflow. But I have no fundamental comfort on the stock at any point of time, at any level.