WEEKLY PICK- RAMCO SYSTEMS!!

**ABOUT COMPANY**
Ramco Systems, part of the Ramco Group, has delivered enterprise software and services since 1989. Today, Ramco is a global provider with customers in 35 countries. To keep pace with today's customer-driven business environment, companies must re-think their business processes. Enterprise applications now need to adapt to the business.
Ramco delivers solutions that address this with flexible enterprise applications that can be delivered quickly and cost-effectively into complex environments. It also gives companies the agility they need to stay competitive by enabling fast, flexible deployment and change on demand of business applications.


**CLIENTELE**
The company is having a long list of clients it 100,000+ users in 1,000 customer locations across 35 countries. Select customers include:
1) ABB Ltd.
2) Adams (Thailand) Ltd.
3) Amtek Auto Ltd.
4) Columbia Helicopters
5) East India Hotels
6) ICICI Bank
7) JK Cement
8) Lotte India
9) Jeju Air etc.


**SERVICES**
1) APPLICATION MAINTENANCE: Enhances one's existing portfolio with custom applications spanning across technology platforms.

2) INFRASTRUCTURE MAINTENANCE:
Ramco was the first company to provide global ERP-on-demand. They remain the premiere source for all the IT function needs, providing comprehensive, end-to-end infrastructure management services.

3) VALIDATION SERVICES:
From a large-scale transformation initiative to specific point solutions, Ramco offers the businesses end-to-end validation services for enterprise applications, integration technologies, compliance, and web applications.

4) OnDEMAMD SERVICES:
The solution streamlines and integrates multiple functions and systems into one solution and gives total visibility and control of operations

5) BUSINESS PROCESS OUTSOURCING:
Ramco platform-based BPO services span one's enterprise function needs, including finance and accounting; human resource management systems; and procurement and analytics.

**FINANCIALS**
TRIGGERS:
1) June quarter results were pretty good. (See MY TAKE ON QUARTERLY RESULTS BELOW).
2) Technically good. (See TECHNICALS BELOW).

BACKLOGS:
1) Promoters, FIIs and DIIs holding decreased. (However, the number of shares held by the Promoters has remained constant during the period.)

MY TAKE ON QUARTELT RESULTS:
Overall June quarter results were good; both QoQ and YoY.
YoY: Net sales increased 13.86% whereas PBDIT increased 142%. PAT increased by more than  320% and OPM increased by 10.35%.
QoQ: Net sales increased by 6% almost and PBDIT increased by 17.53%. NP increased by 58% and OPM increased by almost 2%.

FUTURE PLANS:
Ramco is planning to Introduce Corebanking Analytics Solution. Ramco targets 5,000 users by March next for ERP service.


**TECHNICALS**
Charts shows a strong support zone around 338-344 levels and a good resistance around 385-394 zones. It broke it's resistance with good volumes (highest volumes in last one month). It corrected almost 45% from its 52-week high and recovered 20% in just few trading sessions! It's currently on a breakout and should continue the rally in near term.


**MY TAKE**
It's a clear buy for next 10-15 trading sessions.


DISCLOSURE: All the information is based on the writer's own research/gathered from public domains. This report and information herein is solely for information purposeand may not be used as an offer document or solicitation of ofer to buy or sell or subscribe for securities or other financial instruments. This article is being supplied only for your information and may not be redistributed/reproduced or passed on directly or indirectly to any other person or published, copied, in whole or in part for any other purpose. This information is subject to change without any prior notice. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The investment or discussed or views expressed may or may not b me suitable for all investors. The blogger reserves the right to make modifications and alterations to this statement as may be required from time to time without any prior approval. The writer of this blog is neither a researcher nor related to any brokerage houses. The writer might be himself invested in the stock after his own research so the views might be biased. One must do their own research before investing. The writer isn't advertising any website for his own selfish use. The writer of this blog won't be held responsible for any profit/loss in your investment/trading career.

SOM DISTILLERIES AND BREWERIES LTD- QUICK BUCKS!

Article as on 3rd August 2018:-



**ABOUT COMPANY**
Som Distilleries and Breweries, incorporated on March 26, 1993, is engaged in manufacturing beer and Indian made foreign liquor. The company owns brands such as Hunter Extra Strong Premium Beer, Legend Premium Beer and Legend Premium Lager Beer. It has manufacturing facilities in Bhopal, where it has brewing, storing and layering facilities. The company's manufacturing facilities are spread over 20 acres in the Raisen district of Madhya Pradesh with an annual capacity of 3.6 million cases.
A joint collaboration with Falcon Traders in Goa will enable the company to venture in the Goan markets for the very first time with its own and other brands. Sales would be promoted in the western and southern markets through this alliance.
Among the few companies which have production and marketing infrastructure for Indian Made Foreign Liquor (IMFL) and beer products, the company develops export markets for its products in Europe, Middle East and CIS countries and has been exporting products to London. It undertakes contract manufacturing for clients including Mendoza Vino , USA and United Breweries.


**TRIGGERS**
1) Promoters holding increased by 0.07%.
2) When compared YoY, Mar2018 profits growth was around 170%, whereas topline growth around 50%. The June quarter is usually the best quarter for the company.
3) The entire alochol sector is in bull run and all its peers are posting good results.
4) DER is lowest, when compared to other H.Y. reports.
5) operating profits to interest highest at 7.95 times.
6) ROCE highest at 29% (H.Y. periods)
7) Debtors turnover ratio highest at 6.13times (H.Y. period)


**BACKLOGS**
1) RM cost is more than 50% of total turnover.
2) Low promoter holding.
3) Debt is high compared to its peers.
4) sales to mcap ratio is more than 2 and Price/book is 4.7


**TECHNICALS**
The scrip is consolidating between 225-250 range for more than a month. Immediate resistance is around 260-265 levels and next one is 298-307 levels on closing basis. There is a strong support at 220-225 levels. A close above 265 for 2 consecutive days should lead to next resistance zones in less than a week.

**MY TAKE**

SDBL can give decent returns in next few months. A good bet for MTT 270/293/321 from CMP 244.

DISCLOSURE: All the information is based on the writer's own research/gathered from public domains. This report and information herein is solely for information purposeand may not be used as an offer document or solicitation of ofer to buy or sell or subscribe for securities or other financial instruments. This article is being supplied only for your information and may not be redistributed/reproduced or passed on directly or indirectly to any other person or published, copied, in whole or in part for any other purpose. This information is subject to change without any prior notice. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The investment or discussed or views expressed may or may not b me suitable for all investors. The blogger reserves the right to make modifications and alterations to this statement as may be required from time to time without any prior approval. The writer of this blog is neither a researcher nor related to any brokerage houses. The writer might be himself invested in the stock after his own research so the views might be biased. One must do their own research before investing. The writer isn't advertising any website for his own selfish use. The writer of this blog won't be held responsible for any profit/loss in your investment/trading career.

GM BREWERIES- A POTENTIAL MULTIBAGGER!

Article as on 3rd August, 2018:

**ABOUT COMPANY**

             GM Breweries was incorporated in the year December 1981. The company is engaged in the manufacture of alcoholic liquor. It blends and bottles alcoholic liquor and concentrates more on country liquor. It has its manufacturing unit in Thane district of Maharashtra with installed capacities of 82.6 million bulk liters of country liquor and 12.4 million bulk liters of Indian made foreign liquor. 

              The company markets its products brandy, rum and whiskey under brand names Pioneer Doctor Brandy, Pioneer Special Doctor Brandy, Hot Shot Rum and Reporter Choice Whiskey. The company has imported oakwood barrels to mature the whiskey in order to impart the liquor with the correct character, color, strength and distinctive taste.

                The company has a major presence in Mumbai, Navi Mumbai and Thane and is the single largest manufacturer of country liquor in Maharashtra.

**PRODUCTS**

1) GM SANTRA

                 The most leading and Prestigious blend, made from Molasses based recitified spirit. Ruling at No. 1 Position amongst Country Liquor Industry for the past 12 years, in the State of Maharashtra.

2) GM DOCTOR

                 One of the most precious brand made of sugarcane juice spirit Flavour and is ruling the market last 25 years.

3) GM LIMBU PUNCH

                 A mixed punch blend of Lemon and lime flavours along with rectified spirit from MPVD plant. 

**FINANCIALS**

                Almost all the sales comes from country liquor. It contributes more than 25% market in Maharashtra. It is the largest manufacturer of country liquor in Maharashtra. 

                Their main raw material is rectified spirit. Raw material cost as a percentage of sales is lowest when compared with last 2 years.

Mar 2016: 18.27%

Mar 2017: 20.21%

Mar 2018: 17.30%.

As per AR the price fluctuations and the shortage can affect the OPM. 

                  The profits have been increasing over the last 3 years.

Mar 2015: 18.63crs

Mar 2016: 58.31crs

Mar 2017: 43.92crs

Mar 2018: 72.90crs.

The profits will continue to increase over the next 3-5 years.

                  It has a capacity of 13.76 Crore Liter per annum. Currently, 49.20% is in use. The capacity utilisation of the co is as follows:

2010: 42%

2011: 44.40%

2012: 45.39%

2013: 47.13%

2014: 43.39%

2015: 45.43% 

2016: 46.15%

2017: 46.56%

2018: 49.20%

It might not require any capacity expansion for next 5 years atleast(mentioned innAR2017-18). 

                  Company generated highest cash flow in last 3 years. Finance cost decreased by more than 85%. Company's non current investment increased by 107.7crores in last 2 years. The company received dividend income. The company invested more than 62crs in FDs. Invested around 12crores in other plants and assets.

                    

Cons:-

1) The recent OPM was 7%. This decrease in OPM is seen despite a decrease in raw material, employee/selling and admin/Power and fuel expenses.

2) The Company has been facing difficulty also due to

very high levels of taxation and frequent changes in

laws. In fact the exorbitant rate of taxation is one of

the factors, which breeds duty evasion. 

3)  The high level

of fluctuations in the prices of its main raw material

as well as acute shortage

in the availability of Spirit are the constraints faced by the company for past several years.

**INDUSTRY**

                    According to the 68th report of the National Sample Survey Office (NSSO) on Household Consumption of Various Goods and Services in India, in 2011-12 (the last year for which the data is available), per capita alcohol consumption in rural India increased by nearly 28 per cent, while that of urban India rose by nearly 14 per cent.

                    The two states in the southern part of the country, i.e. Andhra Pradesh and Telangana are the highest alcohol consuming states in India. According to the NSSO data, Karnataka consumes 101 ml of foreign liquor/wine over 30 days while neighbouring Maharashtra drank a mere 10 ml over the same period.

                   The Indian Made Foreign Liquor (IMFL) segment is estimated to be valued at more than INR 3,000 Bn by 2026, expanding at a CAGR of 5.2% over the forecast period.Rapid increase in urban population is one of the key factors that is boosting the India alcohol market. Traditionally, brown spirits have been targeted at the urban consumer. As such, increasing urban population coupled with factors such as increasing disposable income and growing preference for whiskies is expected to create avenues for growth of the alcohol market in India. Changing demographics is further expected to boost the India alcohol market. As of 2014, over half the country’s population (53%) was above the age of 25 years. Moreover, estimated median age of the country’s population for the same year was pegged at 27 years. The legal drinking age in India varies from state to state. For instance, 18 years in Goa, Uttar Pradesh and Karnataka; 21 years in Tamil Nadu and Andhra Pradesh; and 25 years in Maharashtra, Delhi and Punjab.

                    While many frown at the way India is guzzling, others say it’s encouraging how, with time, several taboos fell by the wayside. “There is so much more exposure today. People travel, their entire way of thinking has changed. Enjoying a drink is not such a big thing anymore,” says Adarsh Shetty, president of the Indian Hotel and Restaurant Association of Maharashtra. His state recorded an annual consumption of 3,228.28 lakh bulk litres of country liquor in 2016, the most preferred alcoholic drink in the state.

                   Sociologist Bhaichand Patel, who authored Happy Hours: The Penguin Book of Cocktails in 2009, says the “situation has changed remarkably, especially for women”. “Earlier, women who drank were frowned upon. My wife wouldn’t drink before my parents, but my daughter has no qualms about drinking with us. That is the change,” he says, noting how “India did not have a culture of drinking.” “Before the 1960s, both Delhi and Mumbai were dry. Even five-star hotels didn’t serve alcohol. The only people who could drink were foreigners. Some of us got rum from the Navy canteen. We got a bottle of Black Knight whiskey for Rs 50. Even the rich had Indian whiskey in the ’70s. Not any longer,” says Patel, adding that India remains the largest consumer of Indian whiskey, and comes second only to the US in consumption of Scotch whiskey.

(OVERALL INDUSTRY IS HIGHLIGHTED AND AMONG DIFFERENT STATES ONLY THE MAHARASHTRA STATE IS FOCUSED!)

                     

**SHAREHOLDING PATTERN**

                     Promoters hold around 74.43%, and promoter with highest holding is JIMMY WILLIAM ALMEIDA who holds 61.76%. second highest promoter holding is ALMEIDA HOLDINGS PVT LTD holding 10.68%. They're is no change in promoter holding since last 1 year. There are no pledged shares. Highest public shareholder is MUKUL MAHAVIR AGRAWAL who holds 1.71%. 18 FIIs have invested in the company whose total holding is 2.43%. FIIs have increased 0.24% of their holdings compared to march Qtr. MF holdings have also increased by 0.29% since last Qtr.

**TECHNICALS**

                      After touching all time high of 969 the scrip corrected more than 25% lingering around 700 levels. The charts show strong support around 665-680 levels. Below these levels the scrip can dip to 630-610 levels, where the scrip must be averaged. Immediate resistance around 740-755 zones and long term resistance level around 938-955 levels. 

**MY TAKE**

                     CMP 705 may not be the bottom and share price can be seen even around 685 levels. The company posted great quarter results. More than 15% increase in topline and more than 115% increase in bottomline. There was a decrease in Raw material prices and an increase in other incomes. Overall results were quiet good. If the company continues to post such good numbers to continue throughout then we can expect a 3-5x returns.

DISCLOSURES:- All the information is based on the writer's own research/gathered from public domains. This report and information herein is solely for information purposeand may not be used as an offer document or solicitation of ofer to buy or sell or subscribe for securities or other financial instruments. Tgis article is being supplied only for your information and may not be redistributed/reproduced or passed on directly or indirectly to any other person or published, copied, in whole or in part for any other purpose. This information is subject to change without any prior notice. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The investment or discussed or views expressed may or may not b me suitable for all investors. The blogger reserves the right to make modifications and alterations to this statement as may be required from time to time without any prior approval. The writer of this blog is neither a researcher nor related to any brokerage houses. The writer might be himself invested in the stock after his own research so the views might be biased. One must do their own research before investing. The writer isn't advertising any website for his own selfish use. The writer of this blog won't be held responsible for any profit/loss in your investment/trading career.

EON ELECTRIC- A POTENTIAL MULTIBAGGER!!!

 Article as on 24th July, 2018.
All the data's mentioned below will be as of AR2016-17 since 2017-18 is still not published. New information will be updated on monthly basis.


**ABOUT COMPANY**
Eon elect(NSE CODE:EON; BSECODE:532927), after recent fall of 70% from the yearly highs seems like a decent long term bet, it's leading manufacturer of LT Electrical Switchgear Equipment.

Eon electric specialises in many products. The products are mentioned below:

#Gold plus
MCBs
HRMCBs
RCCBs
DBs

#Goldline
Goldline MCBs
 Goldline RCCBs
Goldline DBs
Silverline
 Silverline MCBs  

#Industrial Products
ACBs
MCCBs
Changeover Switches
Switch Disconnector Fuses
HRC Fuses & Fuse Bases
Rewirable Switches
Feeder Pillars
 MPCBs
Contactors
Time Switches
Thermal Overload Relays

#Lighting Products
CFLs
FTLs
Energy Meter
Wires and Cables
Modular Wiring

It's manufacturing units are mainly spread over northern region but has set up 3 large plants  one for the manufacture of switchgear, other for lighting products and third for manufacture of wires at SIDCUL, Haridwar, the tax free zone of Uttrakhand.

The company has collaborated with Saudi National Glass for setting up a plant in Saudi Arabia for manufacturing of CFL HID Lamps. The company has an all-India marketing network with 30 offices across India and network of over 550 authorized distributors and over 15,000 Electrical Retail outlets spread all over India and overseas.

**FINANCIALS**
As per the data, around 65% of revenue comes from lighting products and 20% from cable wire. (These percentage are almost same every year even if we don't have 2018 reports we can depict a rough picture.)Lighting segment has been allocated highest cap. RMC as a percentage cost of sales is decreasing over years, currently the RMC is 70% which was around 80% 3 years back.

Yearly EPS of 2014 was -15 and of 2017 is 2.49. Yearly EPS of 2018 was 0.27 but it was mainly due to decrease in revenues.

No comments on Cash flow and Balance sheet. Waiting for AR2017-18. As per bal2016-17 investment is around 45 crs and the current mcap is 75 crs.

Operating profit margin for 5 years are
Mar2015:(-14%)
Mar2016:(-0.5%)
Mar2017:(4%)
Mar2018:(5.84%)
PBDIT is 9.3crs vs 7.4crs


Cons:-
1. Operating profit to interest is lowest this qtr along the last 5 qtrs.
2. Debtors T/O ratio(HY) is continuously falling for last 3 years.
3. Cash and cash equivalent (HY) is lowest this qtr in last 3 years.
4. Debt-equity ratio(HY) is 0.78times highest in last 3 years.
5. Quarterly NET SALES, PBDIT, PBT, EPS is lowest in last 5 qtrs.


**SHAREHOLDING PATTERN**
Promoters hold around 62%, main promoter VPM elevtricals Pvt ltd. holds  around 35%. Anoyher promoter co VPM industrial services corporation holds around 13%. Promoter holding increased more  than 2% in last 4 qtrs. Highest shareholder is Rajasthan global securities Pvt Ltd which holds around 1.05% of the co. They have also invested in Vindhya telelinks which is in the wire industry though Eon is much more diversified.

CONS:-
pledged around 40% (pledged shares increased 8% this qtr)

**Technicals**

After touching multi-year high of 137 it corrected more than 70% making a new yearly low of 39. According to weekly MACD indicator it's bearish and slightly bearish as per monthly MACD indicator. As per weekly Bollinger bands it's mildly bearish, whereas it's bearish as per DMAs. As per 5-year charts it has a fairly strong support around 40-42 zones and a strong support around 31-33 zones. 

**MY TAKE**

I feel like CMP45 isn't the bottom and we can see the share price around 35 levels. I feel Q1FY2019-20 is one of the major qtrs. If the company continues to shows the growth which has been shown for FY 2013-14 till 2016-17, then this is one of the underrated multibagger. In my opinion over the span of 3-4 years the share price should be hovering around 140-160.

Any views/information/opinions are accepted and if the information is related to this scrip then it will be updated on the blog. 

DISCLOSURE: All the information is based on the writer's own research/gathered from public domains. The writer of this blog is neither a researcher nor related to any brokerage houses. The writer might be himself invested in the stock after his own research so the views might be biased. One must do their own research before investing. The writer isn't advertising any website for his own selfish use. The writer of this blog won't be held responsible for any profit/loss in your investment/trading career.