Multibaggers: SP Tulsian's 2 picks for good returns

On Bliss GVS, he has a price target of about Rs 50 in the next three months. 

According to him, Canara Bank has a price target of Rs 375-380 in the next six months or so.

Houseviews: Trading tips on 4 buzzing stocks

Below is the edited transcript of his interview with CNBC-TV18's Udayan Mukherjee and Sonia Shenoy.

Q: Why have you picked Bliss GVS?

A: The company is into anti malaria and OTC drugs. The company has been doing quite well. If you see the financial performance for FY12, they had a profit after tax (PAT) margin of more than 20%, close to about 21%. On a top-line of Rs 260-265 crore, they made a PAT of close to about 53 crore.

If you go by their Q1 performance, the PAT margin has improved to about 28% on a top-line of Rs 64 crore. So, for whole of FY13, we should be able to see similar kind of PAT margin.

To expand their portfolio, the company has recently acquired 70% stake in a pharmaceutical company by paying Rs 18 crore. So, they will be expanding more in the OTC products where generally if you have a strong brand equity of your product, it always enjoys a very high profit margin. If you see the midcap pharma stocks, you cannot call this company as a pharmaceutical company, but it is mix of both.

The company is seeing buying for the last couple of days. I have been keeping a positive stance. I recommended the stock about a year back, when the share was ruling quite low. The process of acquisition of the pharma company should get completed maybe in the next three-four months. So, in the second half, we will be seeing the results from that company also contributing and getting consolidated in the financial results.

Apart from that, shareholding is quite low. The company is debt free with promoters’ stake of close to 65%. So, taking all this into account, the stock is a steady and safe stock. One should not expect the stock to double like Shasun Pharmaceuticals, Wockhardt or Stride Arcolab. But one can expect a gradual return, maybe a return of 25% in six months. It can be held for a couple of years also. It can see return of about 30-35% every year. So, I am expecting a price target of about Rs 50 in the next three months. It is a very stable and well-established company.