Sunday, February 27, 2011
A strong pace of execution in projects from steel and cement industries, comfortable order book, entry into utility power equipment and almost nil debt are all positives for energy and environment solutions provider Thermax.
Aurobindo Pharma, on February 23, announced that the US FDA had imposed a ban on shipments from one of its unit; following which the stock tumbled 17 per cent. It has plummeted 26 per cent over last week accompanied with heavy volumes and is currently testing its significant long-term support band between Rs 155 and Rs 165.
The stock of consumer durable maker, Hitachi Home & Life Solutions (India), is available at a price-to-earnings ratio of 14 times (trailing earnings) after a price correction of over 40 per cent in the last five months. We see this price correction as an overreaction from the market to the company's results that were below expectations in the last two quarters. The stock looks a good investment at the current market price of Rs 178.
During the last two years, the auto industry has had a dream run, thanks to the turnaround after the economic slowdown. Going forward, the industry faces headwinds in the form of high input prices, increasing interest rates and an expected moderation in volumes due to base effect and rising prices. On the other hand, there are no signs of weakness in demand, indicating that there may still be steam left before the industry growth peaks out.