Alok Industries a safe stock: Irani

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Alok Industries a safe stock: Irani

Alok Industries is a safe stock, says Mehraboon Irani, Centrum Broking.

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Excerpts from Your Stocks on CNBC-TV18 Watch the full show » RELATED NEWS Alok Industries can test Rs 30: Bhambwani Hold Alok Industries: Sekhar Traders can go long on Alok Industries: Sukhani ALSO READ See previous views by Mehraboon Irani See what other Experts & Brokerages are saying about Alok Industries See messages about Alok Industries Alok Industries BSE | NSE 30/05/12 Are Mutual Funds betting on Alok Industries?

Alok Industries is a safe stock, says Mehraboon Irani , Centrum Broking.

Irani told CNBC-TV18, "On the whole, the outlook is improving for the textile sector. An integrated player like Alok industries looks quite interesting and on the whole a company like S Kumar's also looks very interesting. So there are some interesting stocks in this particular segment. We are still a little bit far away from the time where we will definitely see this company coming back into the top form but on the whole the outlooks improving."

He further added, "In Alok Industries there are two major concerns one was the high debt in the books and second is the company's diversifications in the real estate space. I think what I understand now is that the company is exiting its real estate and getting around Rs 10 billion for it and paying back Rs 4 billion towards its commitment as far as this particular space goes and the balance is going to be used to reduce this debt."

"As I mentioned earlier, I think an integrated player into the home, textile as well as apparel segment and this should possibly take care of the company even in the space of some uncertainty coming in some more time to come. But all in all I feel Alok is a lovely interesting turnaround story, available at about 0.5 times its book value. So I think this is a safe stock but it will take its own time to give returns to its investors. So over the next 2-2.5 years, I think the stock possibly could end up doubling as far returns to the investor are concerned."