Canara Bank And Siemens In Focus | NDTV Profit

  • 4 months ago
#CanaraBank and #Siemens in focus today.


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01:06 - Good morning and thanks so much for joining in.
01:09 You're watching Ask Profit.
01:10 My name is Alex Mathew and with me is Smriti Chaudhary
01:13 and we'll take you through the next half an hour
01:15 or so of trade.
01:16 If you've got questions for us related to stocks
01:19 and nothing else, if they're short term or long term,
01:22 it doesn't matter.
01:22 Send them to us on the WhatsApp number
01:24 that is on your screen right now
01:26 or on any one of our social media platforms,
01:28 particularly on the YouTube Live and we'll get them answered.
01:32 Before we do though,
01:33 let's take a look at where the markets are right now.
01:35 And in fact, you have the benchmark indices
01:37 that are trading not too far from the low point of the day.
01:40 There's been quite a lot of chop and churn
01:42 in trade today for the benchmark indices
01:44 as well as for the broader markets.
01:45 But right now, we're trading with cuts of about 2/10 of a%
01:48 for the Nifty 50 and trading below the 22,200 mark.
01:52 The broader markets are looking better though
01:53 and you have the mid cap index that's up about 0.8%
01:57 or rather right now 0.7%
02:00 and you have the small cap index
02:01 that's trading with gains of about 0.7% as well.
02:04 Now, in terms of the contribution,
02:06 I want to look at which stocks are contributing
02:10 to the benchmark index move today.
02:13 And on the bottom, you have HDFC Bank
02:15 that's proving to be a bit of a laggard
02:17 and a bit of a weight or an anchor
02:20 for the Nifty 50 right now.
02:21 You have Coal India that's doing reasonably well,
02:24 Cipla that is doing well on the back of promoter selling
02:28 that has taken place.
02:29 We reported on that deal earlier today
02:31 and the stock was up and about,
02:33 but not too much in the way of the gainers
02:36 that are leading to strength for the benchmark.
02:38 In fact, if anything, there are large companies,
02:40 large stocks that are leading to declines.
02:43 In terms of the sectoral movers,
02:44 you have the PSU Banks that are doing quite well today.
02:48 In fact, they're the top sectoral gainer, 1.6% higher.
02:51 Realty is doing reasonably well,
02:53 building on the gains from yesterday's session.
02:55 You have Energy that's up and about as well,
02:58 but among the losers and the laggards,
02:59 you have the FMCG Index,
03:01 it's down about half a percent or thereabouts.
03:03 Let's talk about the stock of the day
03:05 and we've got Siemens that we're focusing on
03:08 because this is a stock that is gaining
03:10 as much as 7% on the back of earnings.
03:13 There is quite a bit that you should look at
03:15 under the surface.
03:16 Of course, the net profit nearly doubled,
03:19 but there are a few points to be made
03:21 with regard to the order inflow.
03:23 Puneet is joining in to give you some of that fine print.
03:26 Puneet, of course, the bottom line number
03:28 looks really great,
03:30 but what can you read from the fine print?
03:32 - Yeah, thanks for that.
03:33 So let's just quickly go on the numbers as well
03:35 because it came post-market hours yesterday.
03:38 The revenues have gone up roughly 18%
03:40 to come at roughly 5,700 crores.
03:42 When we look at the operating profit is up 41%
03:45 and the company has mentioned
03:46 that they saw strong operating leverage play out,
03:49 which as you rightly said,
03:50 led to profit rising by 70% for companies of Siemens size,
03:54 coming at roughly 800 crores versus 400 crores previously.
03:58 When you look at the India highlights,
03:59 the company has got an order inflow
04:01 of roughly 5,100 crores in this particular quarter
04:04 and has maintained that order inflow
04:05 of roughly 5,000 crores per quarter.
04:08 When you look at the other key highlights
04:10 that the company mentioned,
04:11 they said that the profit was driven by higher volumes
04:14 as well as productivity,
04:16 while they also had cost optimization,
04:18 which led to better profitability
04:20 going in this particular quarter.
04:22 The one key thing that the company said
04:24 that they did see the large,
04:26 certain large orders differed to the next few quarters
04:29 due to bureaucratic issues is what they categorized it as.
04:32 And the industrial automation segment,
04:34 which is one of the key contributors for the company,
04:37 they said that in the ordering
04:39 is on account of normalization of demand.
04:42 So this is a key positive
04:43 in this industrial automation segment.
04:45 And they said for delivery
04:46 of the industrial automation products
04:48 will improve compared to the pre-COVID period
04:51 for the company.
04:52 One of the key notable other points
04:55 that the company said was the demerger
04:57 of the energy business.
04:59 This will be listed on the BSE and the NSE as well.
05:02 And the listing is likely in post 2025
05:06 once the necessary approvals that the company has received.
05:09 They will be holding roughly 69% stake
05:12 and the share swap ratio is roughly one is to one
05:15 for the same.
05:16 So what are the brokers are saying?
05:17 Jefferies has a buy call
05:19 and they've increased the target price
05:21 to 8,000 rupees on Siemens from 5,500 earlier.
05:25 When you look at the key,
05:27 they have said that the company's capex
05:29 has been 50% higher over the last seven years.
05:32 And also an additional capex of 333 crores
05:35 in the smart infra business,
05:37 which the company is a key contributor in.
05:39 The one point which you should note
05:41 is the clean demerger of power division
05:43 has potential to create additional value
05:45 for the company as what Jeffrey thinks.
05:47 And this point has been accepted by Nuvama as well.
05:49 They also have a buy on with a target price of 7,700.
05:53 So overall really strong numbers.
05:55 As you rightly said, commentary was key
05:57 and brokerages agree with the same.
05:58 Back to you.
05:59 All right.
06:00 Thank you, Puneet for that.
06:01 And on that note, let me introduce you to the guests
06:03 for today.
06:04 We have Saurabh Jain, Equity Head Research
06:06 at S&C Global Securities
06:08 and Vaishali Parekh, Vice President Technical Research
06:10 at Prabhudas Leeladhar.
06:12 Welcome to both of you and thanks for joining in.
06:14 Saurabh, I'm going to start with you.
06:16 You heard Puneet talk about the commentary
06:18 and the numbers on Siemens now.
06:20 There are a couple of things that are happening here.
06:22 There's a demerger aspect of it.
06:24 There is then the order book that fell a little bit
06:27 about 9% year on year.
06:29 There is also the fact that there is some,
06:31 and that's on the back of deferment of course.
06:32 There's also slowdown
06:33 in the industrial automation product orders.
06:36 Now, considering all of these factors,
06:38 what's the long-term view on something like a Siemens?
06:41 Hi, good morning.
06:43 See, long-term view on the Siemens will remain positive,
06:46 but as you correctly said that the company
06:48 has been seeing some kind of a slowdown
06:50 in their large orders,
06:52 some slowdown in the automation segment.
06:55 And one must consider that huge redating
06:59 has happened in the last two, three quarters.
07:01 I mean, the stock was trading at 10 times to book value
07:04 and now it is trading at 19 times to book value.
07:07 So I think most of the positives have been quite largely
07:12 affected in these stock prices.
07:14 When view remain positive,
07:15 the de-merger is going to happen after three, four quarters
07:18 and that will give shareholder points to one ratio.
07:20 And then the company will be focusing
07:22 on both the two major verticals separately,
07:25 which company feels that it would be beneficial
07:28 for future growth that India is experiencing.
07:31 Now, I feel that the gains have largely been vectoring.
07:36 There may be a 10, 20% kind of a gain
07:38 which may follow in the next two, three quarters.
07:42 But I think it is a kind of a portfolio stock.
07:44 If one is holding, then he can hold on to it.
07:47 But I don't feel like jumping on to at these prices.
07:52 Fair point.
07:53 So avoid a fresh entry if you're holding,
07:54 perhaps you can continue to hold.
07:56 It's time now to jump into the query segment.
07:58 And as I mentioned at the start,
08:00 if you've got questions for us,
08:01 you can send them to us on that number
08:03 that you can see at the bottom of the screen.
08:04 And the first one is coming to you Vaishali
08:06 and a couple of stocks, Mahindra and Mahindra,
08:09 as well as HAL, Hindustan Aeronautics.
08:13 And this is something that Janaki Ram
08:15 from Shivakashi in Tamil Nadu wants to know,
08:18 should these be bought?
08:20 And what should the ideal holding period be
08:22 for these two stocks?
08:24 Well, let's start with, sorry, Mahindra and Mahindra,
08:29 I think the buying opportunity is not now.
08:32 One can wait for a dip if at all it comes
08:35 towards 2100 levels, because that's where now
08:38 we are looking at prominent support
08:39 because the stock has really run up quite a bit.
08:42 So I would say wait for a dip,
08:43 2100 should be the level that one can consider
08:46 because well, it's already an overbought.
08:49 So it's a cautious move.
08:50 So even to those who are holding,
08:52 should hold with a trailing stop loss.
08:54 And the other one which we are talking about is HAL.
08:57 And HAL also, I think 3800 is a prominent support.
09:00 And just sometime back, we saw a dip coming in,
09:04 we saw a low of 3820.
09:06 So that should act as a prominent support.
09:08 And these are the levels
09:09 that one should look for buying opportunity.
09:11 All right, coming back to you, Vaishali,
09:14 this one's on Tata Investments.
09:16 This is from Anuradha from Mumbai.
09:18 They say they bought the shares at a price of 7,888.
09:22 So elevated levels from where it's currently trading at.
09:27 Now, the share has been a multi-bagger
09:29 but seems to be losing ground.
09:32 What's the outlook from a short
09:34 to medium term perspective on Tata Investments?
09:37 So well, the stock is definitely consolidating.
09:40 And I think, well, even if it dips up to 6,000 levels,
09:44 it is yet a good level.
09:46 It's not damaging the trend.
09:48 Only below 6,000 would be a level to worry about.
09:51 So that would trigger a further downslide
09:53 towards 5,400 or so.
09:55 So right now I would say with the support of 6,000,
09:58 one can consider averaging out also.
10:00 Okay, we've got a question from,
10:03 I'm trying to get the name.
10:06 Okay, Muralidharan from Chennai.
10:09 He's asking about Aurobindo Pharma,
10:11 which he's bought very recently at levels of 1,600.
10:15 And he's bought as much as 550 shares.
10:19 He's wondering whether to hold.
10:22 Okay, I believe that the price might be a little wrong
10:25 from what I'm reading it.
10:26 1,160 is what he has bought it at.
10:30 He's wondering whether to hold onto this.
10:32 And he's also looking for a target, Saurabh.
10:35 What's the view on this particular counter?
10:37 I think the company is posting a good set of numbers
10:41 and the management has also guided
10:43 that there will be a good growth going forward.
10:46 Pharmaceutical sector per se is doing well.
10:48 I think a lot of companies are launching new drugs
10:51 and coming out with new molecules.
10:54 Even the US is looking okay to many of the companies.
10:57 In that context, I feel that it is good to hold
10:59 for next two, three quarters.
11:01 All right, the next counter we're talking about
11:03 is Tamil Nadu Mercantile Bank.
11:05 This one's from Jason.
11:07 Now, it's a recent listing.
11:08 So, Saurabh, coming to you on this,
11:10 for somebody who's holding these shares from the IPO price,
11:14 if I'm not wrong, it has fallen since then.
11:17 And--
11:18 About 4.5% or thereabouts.
11:19 Yeah, so it seems to be that the viewer is in a bit of losses.
11:24 Q4 results are out, nothing to,
11:27 I mean, not too much there as well.
11:29 What's the long-term view on something like this?
11:30 Would you suggest holding onto it?
11:33 I think on the banking sector, our view is positive,
11:36 especially in the context that the RBI is not likely
11:38 to cut the interest rate,
11:40 which will help these banks to maintain the margin.
11:42 Since it is a newer listing,
11:44 I think it is put into wait
11:45 for how the quarterly earnings plan pans out.
11:48 In my, I haven't seen the recent quarter earnings.
11:52 I think if the numbers are okay,
11:54 if the numbers are okay, then it is good to go.
11:58 Dinesh from Noida is asking about a couple of,
12:01 or rather three stocks in particular.
12:02 And I'm coming to you, Vaishali, I'm reading them out.
12:05 Bikaji Foods, Scient DLM, as well as Schneider Infra.
12:09 And he's looking at the long-term prospects of these three,
12:13 and he's wondering whether he should start buying them now
12:16 for a period of, say, even five years in a staggered manner.
12:20 What is the timeframe or rather,
12:23 what level should he look at specifically
12:25 if he wants to start accumulating these?
12:29 - I'll start with Bikaji Foods.
12:30 Actually, yes, the trend is pretty much intact.
12:33 And this is a good level because it is currently
12:36 at a cluster of moving average support levels.
12:38 I would say be very, very disciplined
12:41 because when I'm looking at the longer-term timeframe,
12:44 you know, 480 should act as a stop-loss.
12:46 Below that, the trend of all-time periodicity can get weak.
12:50 So keeping 480 as your support.
12:53 And further on, conviction comes about 560 levels.
12:56 So that should be the range that he should be accumulating.
13:00 And then if it moves about the resistance level of 550, 560,
13:05 then we are heading for a target of 600 and perhaps higher.
13:08 So this is how he should plan buying Bikaji Foods.
13:11 The other one you asked me is?
13:13 - I'm just gonna try and remember.
13:16 Schneider is the other one, if I remember correctly.
13:19 And Scient DLM.
13:21 - Yes, so Schneider has given a superb run-up,
13:24 and I think the trend is also intact.
13:27 Even currently, it has just made a minor dip
13:29 at around 750 levels.
13:31 So keep that as a support, and one can buy even now
13:33 because if I am not wrong, it's on a verge of a breakout.
13:38 About 860, it gives a further projected target of 920.
13:43 So Schneider can be bought even now.
13:46 And the Scient, I will just tell you.
13:48 - In the meanwhile, let's pull that up, yeah.
13:51 - Yes, so I think that also,
13:53 longer-term time frame is pretty much intact.
13:56 He can accumulate at these levels
13:58 because in the recent past,
14:00 we have seen that the stock has just made a high
14:03 of around 2300, and now it's quite in an oversold zone.
14:07 So this could be the level of accumulating.
14:09 You're asking me about Scient DLM.
14:11 - DLM, that's right.
14:12 - Okay.
14:15 So I would say yes, this too is a level
14:18 because 650 acts as a very good support.
14:21 Repeated supports have been taken at this level,
14:23 so I would say good buying opportunity.
14:26 And above 720, 730, it would be ready
14:29 for higher targets of 800, so go for it.
14:32 - All right, the next counter we're talking about
14:34 is Parag Milk Foods.
14:35 It's a 2,500-crore market cap company.
14:38 The question from Satya, they bought the shares
14:40 at a price of 202 rupees, slightly above,
14:44 slightly below what it's currently trading at.
14:46 Saurabh, from a longer-term perspective,
14:48 the stock has done pretty well in the last one year.
14:51 It's almost doubled.
14:53 What is the long-term view
14:55 on something like a Parag Milk Foods?
14:57 - See, all the companies in the daily markets
15:01 are seeing stable pricing for the milk
15:02 and they are venturing into the newer products.
15:06 I mean, daily product, apart from daily products,
15:08 they are adding newer products to their kitty
15:11 and expanding their job fees.
15:13 And that is the reason behind the strong performance
15:18 and the rally in the stock.
15:19 I feel, I think it is better to hold this stock
15:22 for another three, four quarters.
15:24 - Fair point, that's the view on Parag Milk.
15:27 We have to slip into a very quick break,
15:29 so do stay tuned, viewers.
15:30 We'll be back on the other side
15:31 to take more of your questions.
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18:46 - Welcome back, you're watching Ask Profit.
18:53 And we are taking the next question from Sreeja.
18:58 Sreeja points out that based on advice
19:01 that she got on Ask Profit,
19:03 she bought HCL Tech at levels of 1650.
19:08 And I believe at the time,
19:09 she must have bought it from the long-term perspective.
19:11 And the stock has dropped as part of the drop
19:15 in the IT pack as a whole.
19:17 For the year so far,
19:18 and I'm looking at the year-to-date returns,
19:21 it is down about 10% or thereabouts.
19:23 And she's bought it slightly elevated levels.
19:25 I'm going to come to you, Saurabh,
19:27 on the fundamentals of this.
19:29 We've seen the entire IT sector lose ground
19:33 for various reasons.
19:34 But at around 1300,
19:36 would you suggest that she should average her holding
19:39 and she should hold for the long-term?
19:41 - See, I would not suggest you average the stock,
19:45 but at the same time,
19:47 I would suggest you hold on to the counter.
19:49 See, all these companies have shown good,
19:51 shown good operational performance in the March quarter.
19:54 But the guidance was weak.
19:56 In the context that the discretionary spending
20:00 is not coming in the way the company was earlier perceiving.
20:04 In the US also,
20:05 the interest rates are likely to stay higher for long,
20:08 which will curb the FSI sector
20:10 to curb spending on the IT side.
20:12 And in that context,
20:13 I think the outlook has become bleak
20:17 for all the IT biggies.
20:19 So I think it will take another three, four quarters
20:21 for these companies to experience,
20:23 to see growth coming back to the fore.
20:27 So I think if she can hold for another two, three years,
20:31 then there is no worry.
20:32 At the same time,
20:33 there is no point in averaging
20:35 because as of now, it is a quantitative fall.
20:38 - Fair point.
20:39 Also, I want to clarify that the views that are expressed
20:41 and the advice that is dispensed
20:43 is aimed at helping you make a decision
20:46 when you're investing in stocks and when you're trading.
20:49 It's not a guarantee for success
20:51 and you should keep reviewing it,
20:52 particularly your long-term portfolio
20:54 and pay attention to what is happening
20:56 in a particular sector or with a particular company.
20:59 So the IT sector as a whole has had not the best Q4
21:02 and that has played out in the stock prices
21:06 over the course of the last few months.
21:07 Let's take the next question.
21:09 - The next one is Zomato
21:11 and this one's from Shri Kishore Sharma from Bihar.
21:13 They say they bought the counter at a price of 192.
21:16 So slightly above where it's currently trading at.
21:19 This is from a three-year perspective.
21:22 Sort of we just saw the fourth quarter results come in,
21:25 Blinkit, it was a net positive EBITDA
21:29 for the whole year for Zomato.
21:32 So a positive sort of a sentiment there,
21:36 but we did see a slight hit
21:38 that the stock got after the results.
21:40 But you look at Blinkit's performance,
21:41 what a turnaround story that is.
21:43 What's the long-term perspective on something like a Zomato
21:46 from a three-year perspective
21:47 if you have a target on the counter as well?
21:49 - See, from the long-term perspective,
21:53 I think it is a good play.
21:54 Kind of you can keep it in the portfolio.
21:57 See, the turnaround was quite effective
21:59 by the market in the stock price
22:02 in the last two, three quarters
22:03 when the Zomato became EBITDA positive.
22:05 Since then, we saw that Zomato has been marching upwards.
22:09 And the valuations have now been close to nine
22:13 or 10 times to book value.
22:14 I think at times what happens when the good results come in,
22:17 boom and loading type selling comes into the picture,
22:21 and that is what I think the stock is experiencing right now.
22:24 I think in the few days, the stock will settle down.
22:28 From the long-term perspective,
22:29 I think you can hold on to the Zomato.
22:33 - Okay, do you want to also take a technical view
22:35 on Zomato, Swati?
22:36 - Yes, let's.
22:37 - All right, so Vaishali, anything that you can tell us
22:39 from what you're seeing on the charts on Zomato?
22:42 - I think it has performed very well
22:45 and currently also post results,
22:47 it's holding on to the trend.
22:49 So I would say every dip,
22:51 I mean, if market has to get a bit volatile
22:55 and we see a bit of correction,
22:56 I think 180, 185 is a level that one can even add more
23:00 because we have a projected target
23:02 coming towards 220 to 250.
23:04 So that is how I would look at this stock.
23:06 - Okay, fair point.
23:07 I can't seem to decide myself
23:09 whether to call it Zomato or Zomato.
23:11 I think I use it interchangeably.
23:13 Let's talk about Clean Science though.
23:15 That's the next counter that we're talking about.
23:16 Clean Science and Technology,
23:17 it's trading currently at 1306 or thereabouts.
23:20 And we've got a viewer, Shabbir Shet,
23:22 sorry, Shabbir Surti, who's bought at levels of 1395
23:26 and is looking at a short-term perspective.
23:28 Vaishali, what's the view on the charts?
23:32 - Yes, I would say it's a fair value right now, 1280.
23:35 I mean, all these stocks have really corrected so much.
23:38 And right now what I'm seeing
23:39 that the stock is in deep oversold
23:40 and it's trying to bounce back.
23:42 So in all likelihood, of course,
23:44 he's gonna get back his buying price,
23:46 but I would say still hold on
23:47 because I think it's a matter of time.
23:49 Like all stocks are cyclical.
23:51 And Clean Science, if I'm seeing it,
23:53 the longer-term period,
23:54 I think it's pretty okay at these levels.
23:56 Look for a target of 1400 to start with.
23:59 If you see a move above 1400,
24:02 it's ready for a takeoff to 1500 and so on.
24:04 So yes, just stay put.
24:06 - All right.
24:07 Next, there are two counters we're talking about.
24:09 This one's from Vishwanathan Nair,
24:11 and they're talking about INOX India,
24:14 if this is a good time to enter the stock.
24:16 And the second one is a recent listing,
24:17 which is Aadhaar Housing.
24:19 Saurabh, if you've had a chance
24:21 to look at Aadhaar Housing as well,
24:23 do tell us if somebody should buy a stock
24:25 at the current levels.
24:26 It's, yeah, INOX India and Aadhaar Housing.
24:30 - Well, I will not be able to comment on the INOX India,
24:33 but in the case of Aadhaar Housing,
24:35 I think the company has a portfolio,
24:37 a mix of portfolio,
24:38 and it's average and non-salaried,
24:39 in which the non-salaried portfolio consists,
24:42 consists close to 45%.
24:45 The salaried portfolio consists of 55% in their landing.
24:48 And they are reaching far out, you know,
24:51 tier two, tier three, and you know,
24:53 interior, a lot of interior places,
24:55 which deals, and those loans usually deals
24:59 with the higher delinquency rate also.
25:01 So I think markets have their own worry factor,
25:03 and that is why we saw muted listing today.
25:06 So I think it is better to, you know,
25:09 to have a stock in the banking sector,
25:12 which you know for a long time,
25:14 for example, a company like Union and Canva,
25:17 rather than chipping into the NBFC like Aadhaar.
25:20 - Right, let me also take INOX India.
25:23 The levels, if what you should enter at in this counter,
25:27 it's been on a bit of a downturn
25:29 in the last couple of weeks.
25:30 Vaishali, could you give us your view on this,
25:33 if one should enter at the current levels?
25:35 - Yes, I think it's at a peak of break levels.
25:39 So currently at around 1,300 levels it is.
25:42 I would say, do buy it at these levels.
25:46 And if we see a break of 1260,
25:49 then that could call for further slides towards 1,211.50.
25:54 So right now, yes, for a short-term perspective,
25:57 also 1260 should be the stop loss and go for the stock.
26:00 - Okay, we have time for one more.
26:03 Vaishali, this is a question from Sanjay.
26:04 He's writing from Kolhapur,
26:06 and he's asking whether you have any
26:08 buy today, sell tomorrow suggestions?
26:11 - Well, right now, today I'm looking at is Kohl India.
26:15 Kohl India, that is what we have recommended
26:17 to our clients also.
26:18 So I think this stock looks good.
26:21 Volume is also high, decent value.
26:24 So keep a stop loss of around 457
26:28 and go for a target of 475.
26:31 - All right.
26:32 Unfortunately, as Alex mentioned,
26:33 that was the last question for today.
26:35 Thank you so much, Saurabh and Vaishali,
26:37 for joining in and for answering all the questions for us.
26:40 Viewers, thanks for tuning in on this edition of Ask Profit.
26:43 We'll be back tomorrow to take more questions,
26:45 but don't go anywhere.
26:46 We have lots more lined up for you on NDTV Profit.
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