Multibaggers: SP Tulsian's picks that can give 25% return

SP Tulsian, sptulsian.com has picked up Peninsula Land and Vikas WSP as his multibaggers for the day.

He has a six-month price target of Rs 50 on Peninsula Land and Rs 75 on Vikas WSP. Houseviews: Brokerages bullish on ITC, Amara Raja & BHEL Below is the edited transcript of his interview with CNBC-TV18's Udayan Mukherjee and Sonia Shenoy. Q: Why have you picked Peninsula Land? A: It is Ashok Piramal group company. If you see the last four years track record of the company, they have really earned the good name as a quality developer by developing two of their residential projects in Mumbai, one is Ashoka Tower and second is Ashoka Garden. Both are in central Mumbai. All are really fascinated and excited by the quality work by that group. Because of that good response, the group has become little aggressive. They have started moving out of Mumbai as well. Many of the projects have already been launched by them. They have presence in Mumbai, Pune, Nasik, Goa, and Bangalore. The company is likely to acquire 14 acre plot very close to Ashoka Garden in Sewri. That announcement is likely to happen maybe in next 15 days or so. If that happens, 14 acre square feet can give them about maybe 15-20 lakh square feet of sellable area. That will be seen as a very big positive for the company. If you go by the financial track record, annually they have been posting a top-line of close to about Rs 500 crore with bottom-line of about Rs 150 crore with profit after tax (PAT) margin of close to about 30%. They have consistent performance. Generally, this company is not seeing so leveraged as we have been seeing in case of other real estate company with net worth of close to about Rs 1,650 crore, which translates into book value per share of Rs 60 and about Rs 150-160 crore PAT every year. That translates into an EPS of close to about Rs 6. The share is ruling at a PE multiple of maybe 7-7.5 time and price-to-book of maybe about 0.6-0.65. Taking all into consideration, I am giving a conservative estimate of about Rs 50 in the next six months or so. _PAGEBREAK_ Q: What about Vikas WSP? A: Because of the huge volatility in the commodity segments, the name of this company also came into that. But the investigations by Forward Markets Commission (FMC) found that they have no involvement. They have only traded in the commodity on the spot basis. If you go by their product profile, they are the largest makers of guar gum polymers which are used in food, oil drilling, mining, and paper industry. Even in food, it has a multiple uses. The company is now doubling its capacity. Presently, they have four manufacturing plants, all in Sri Ganganagar in Rajasthan because guar is cultivated in the Rajasthan state. It has a capacity of 40,000 tonne. Now, they are setting up another plant of 39,600 tonne at Bikaner in Rajasthan. That plant should be operational in next 24 months or so. A couple of months back, there were issues, when the auditors of the company resigned. But purely going on the financial call, for FY12, company had a top-line of close to about Rs 1,000 crore. On that, the EPS was about maybe Rs 12 or so with PAT of about close to Rs 160-165 crore for FY12. For the first quarter of FY13, they have posted the same top-line and PAT. Rs 1,010 crore top-line and about Rs 160 crore PAT with an EPS of close to about Rs 11.75. We all knew that first quarter has been very positive for the company in terms of the realisations. Post that, in this last one month, the prices have really corrected to a great extent. One can expect a conservative EPS of close to about Rs 25 for whole of the FY13. Once the product capacity goes on stream, which will happen in next two years, one can take a long-term view also of next two-three years. But on a short-term basis, one can expect a price of about Rs 75 in the next six months. Disclosure: I have no personal holding in any of the stock discussed.