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Electrosteel: The Dark Horse in the Ductile Iron Pipe Industry!Summary ● Electrosteel Castings Limited (ECL) is a prominent Indian company specializing in ductile iron (DI) pipes, fittings, and cast iron (CI) pipes. With a market cap of ₹13,640 Cr, ECL generates 88% of its revenue from India, holding a 28% domestic market share. ● Over the last 3 years, ECL recorded a 29% sales CAGR and 97% profit growth. Its current PE ratio of 15.3 is below the industry average, suggesting undervaluation. ● ECL plans to boost DI pipe capacity to 1 million tons by FY26. The ductile iron pipes industry is poised for growth due to urbanization and government initiatives. ● With its strong market position and robust financials, ECL is well-positioned to capitalize on this opportunity and deliver shareholder value. Investment Advice by Goodluck Capital Buy Electrosteel Casting NSE:ELECTCAST ● Best Buy Range - 210 - 220 ● Target - 275 - 280 ● Potential Return - 28 - 30% ● Approx holding period 8 - 12 months Company Overview Electrosteel Castings Limited produces and supplies ductile iron (DI) pipes, fittings, and accessories, as well as cast iron (CI) pipes, both in India and globally. Their DI pipes and fittings are used in various applications such as water transmission, potable water distribution, industrial water supply, ash-slurry systems, fire-fighting systems, desalination, sewerage, stormwater drainage, and recycling. They also offer ductile iron flange pipes for temporary installations and restrained joint pipes. Additionally, the company supplies metallurgical coke, sinter, sponge iron, ferro silicon, pig iron, and silico manganese ferro alloy, along with cement branded as SPL GOLD. Originally named Dalmia Iron and Steel Ltd, the company was established in 1955 and is headquartered in Kolkata, India. Market Capitalization - ₹ 13,640 Cr. Peer Companies ● Jindal Saw NSE:JINDALSAW - ₹ 22,576 Cr. ● Jai Balaji Industries NSE:JAIBALAJI - ₹ 19,682 Cr. ● Welspun Corp. NSE:WELCORP - ₹ 18,092 Cr. Technical Aspects ● In January 2008, the stock reached an impressive peak of ₹71 but subsequently faced a significant decline. ● The price eventually stabilized around ₹8, leading to an extended period of consolidation. ● During this time, a Rectangle pattern, often referred to as the Darvas Box pattern, took shape. ● After breaking out of this pattern in May 2023, the stock price surged past its previous strong resistance level in October 2023. ● Since then, the stock has maintained its upward momentum and is currently trading just shy of its historical high of ₹226. ● Expectations are high that this momentum will sustain and lead the stock to reach new peaks in the near future. Relative Strength ● The chart clearly illustrates that Electrosteel Castings has greatly outperformed the Nifty Smallcap 250 index, boasting an impressive annual return of 219%, which is truly an outstanding achievement. Revenue Break-up ● Product wise break-up ➖ The primary source of the company's revenue comes from the production of Ductile Iron pipes and fittings, which alone makes up about 86% of its total income. Additionally, the company manufactures Cast Iron pipes, contributing roughly 2.8% to the overall revenue. ● Location wise break-up ➖ The company generates nearly 88% of its revenue from India, where it holds a 28% share of the domestic market. The remaining 12% of its income is sourced from international markets. Revenue & Profit Analysis ● Over the last three years, this stock has recorded an impressive compounded annual growth rate (CAGR) of 29% in sales. Additionally, the total profit growth during this period has been remarkable, achieving a staggering 97% CAGR. ● Furthermore, the company has successfully maintained an operating profit margin of 16%, a notable increase from 10% in FY24. ● For the fiscal year 2024, earnings per share (EPS) have surged from 5.31 in fiscal year 2023 to an impressive 11.97. Currently, the EPS for the past twelve months is at 14.69. ● A closer look at the quarterly results shows that the company reached a record high in quarterly sales, reporting 2,012 crore in June, up from 2,004 crore in the March quarter. This figure significantly exceeds last year's June quarter sales of 1,685 crore. Product Demand Analysis ● Inventory Turnover Ratio ➖ Current Inventory Turnover - 1.82 ➖ Inventory Turnover 3 years ago - 1.70 ➖ These figures indicate that product demand has risen over the past three years. Valuation ● P/E Ratio ➖ The company's current price-to-earnings (PE) ratio is 15.3, which is below its one-year median PE of 15.8. Compared to the industry average PE of 36.76, this suggests that the stock is significantly undervalued at present. ● P/B Ratio ➖ The stock seems to be undervalued, with a price-to-book (PB) ratio of 2.67, particularly when compared with the industry average PB ratio of 5.52. ● Intrinsic Value ➖ Electrosteel Castings is presently priced at ₹220, which is significantly below its intrinsic value of ₹258, suggesting that the stock is currently undervalued. ● Peg Ratio ➖ A PEG ratio of 0.47 suggests that the stock is undervalued relative to its expected earnings growth. Cash Flow Analysis ● The operating cash flow has experienced an impressive leap, climbing to 806 crore from 452 crore in FY23. This remarkable growth highlights the company's robust financial health. Furthermore, the current CFO/PAT ratio stands at 0.9 of its five-year average, reflecting the company's exceptional capability in turning profits into cash efficiently. Debt Analysis ➖ The company's existing debt stands at Rs. 2,332 crore, a figure that is notably low when juxtaposed with its market capitalization of Rs. 13,655 crore. ➖ With a debt-to-equity ratio of merely 0.46, it is clear that the debt burden is manageable for a capital-intensive enterprise, allowing the company ample room to pursue further financing if required. ➖ Examining the balance sheet shows a remarkable decrease in debt, which has fallen from Rs. 2,667 crore last year to the present Rs. 2,332 crore. Capex Plans ➖ The ongoing capital expenditure stands at around ₹700 crores and is on track, with ₹410 crores already utilized by the end of Q1 FY25. ➖ There are ambitious plans to boost the total manufacturing capacity of DI pipes to 1 million tons by FY26. ➖ Additionally, land is being acquired in Odisha for a new Greenfield project focused on DI pipes and fittings. Shareholding Pattern ➖ The promoters currently hold about 46.22% of the company, up from 44.08% in December 2023, indicating growth during the March quarter. ➖ Foreign Institutional Investors (FIIs) have been consistently increasing their stakes, with total holdings reaching 21.16% as of June 2024, a significant rise from 14.93% in June 2023. On a quarter-to-quarter basis, ➖ Domestic Institutional Investors (DIIs) have raised their holdings to 0.44% from 0.36% in the March quarter; however, this represents a notable decline from the 1.68% recorded in the same period last year. Ductile Iron Pipes Industry Outlook ● Advantages of choosing DI pipes over PVC pipes ➖ According to the analysis of the ductile iron pipes market in India, these pipes are made up of approximately 90% recycled materials and are fully recyclable. ➖ Additionally, using ductile iron pipes instead of PVC can lead to an energy consumption reduction of around 40%. ● Ductile Iron Pipes Market Growth ➖ Ductile iron pipes play a crucial role in public infrastructure, serving irrigation, drinking water distribution, sewage, and wastewater systems. ➖ With India's economic growth, the rise of smart cities and projects like Bharatmala Priyojana and the Narmada Valley Development Project is driving the demand for extensive pipeline networks, boosting the ductile iron pipes market. ➖ Factors such as increasing urbanization and government initiatives like Jal Jeevan Mission, AMRUT, and Smart City Mission, focused on delivering drinking water to households, are further fueling this demand. Conclusion ● After thoroughly examining both the technical and fundamental factors, we have concluded that Electrosteel Castings is well-positioned for substantial growth, driven by the increasing market demand for ductile iron pipes, which is likely to positively impact its share price as well.
NSE:ELECTCASTLong
by GoodluckCapital
4
Bullish Rounding Bottom over the span of 3 years.UTIAMC is poised for a significant breakout as it trades at its highest level ever. If the weekly candle closes with strength, it could be a good opportunity to enter a swing trade with a stop-loss placed at the weekly candle's low. Additionally, in the daily timeframe, the price is consistently making higher highs and higher lows. Disclaimer: This analysis is based on historical data and technical indicators. It does not constitute financial advice. Always consult with a financial advisor before making investment decisions
BSE:UTIAMCLong
by supertraders_india
2
Arvind Fashion - 2 Cup & Handle Patterns!!Arvind Fashion has given breakout of Cup & Handle pattern on weekly time frame. If you observe there is a smaller cup and handle pattern as well in the larger cup & handle pattern. We can see price moving towards our targets of 560-685-950+. Other factors: 1. Weekly volume is great 2. RSI is +ive 3. Fundamentally company is doing great - from loss making to profit making, new stores, etc. Keep following Cleaneasycharts - Right Stock at Right Time at Right Price!!! Cheers!!!
NSE:ARVINDFASNLong
by Cleaneasycharts
3
JKCEMENT - Rounding Bottom Breakout🔊 JKCEMENT - Rounding Bottom Breakout ⌛Duration - Short Term (2 month to 3 month) 📊📈 Trade Logic - Rounding Bottom Breakout CMP - ₹4697 Time Frame - Weekly 🎯Target 1 : ₹5000 🎯Target 2 : ₹5200 🎯Target 3 : ₹5400 🛑 Stop : ₹4400 🏆 Risk/Reward Ratio (1: 2.25) Disclaimer: The stock information shared above is not a recommendation to buy, sell, or hold. It reflects my own analysis and is intended solely for educational purposes. Any actions you take based on this information are your responsibility, and the admin of this channel is not liable for any financial gains or losses. Please consult a financial advisor before making any investment decisions. I am not a SEBI-registered advisor.
NSE:JKCEMENTLong
by Profit_Trader25
2
LTTS - Keep On RadarCMP 5622 on 07.09..24 The stock price has formed a Cup & Handle pattern in the last more than 2 years. The breakout level is around 6000. At the moment of retracement, it may come down to 5450 to 5250. If the price is above the 54200 level, this setup has relevance. It goes weak if the price sustains below 54200. Always keep your risk management in control, and the position sizing too. Projected targets are indicated on the charts. This illustration is only for learning and sharing purposes, not a piece of trading advice in any form. All the best.
NSE:LTTSLong
by anandlive
7
MOTILALOFS: Cup and Handle Breakout – Bullish Continuation AheadAnalysis Overview : This chart of Motilal Oswal Financial Ltd NSE:MOTILALOFS highlights a classic Cup and Handle pattern, which indicates a potential bullish continuation. The stock has broken out of this pattern after retesting the neckline, signaling the possibility of further upside. Key Observations: The Cup and Handle pattern has formed over several months, signifying accumulation. After breaking out from the neckline, the stock retested the breakout zone, which is a positive sign for bulls. The stock is now trading above ₹775.60, approaching a 52-week high of ₹782.90. Volume Surge: There was a noticeable increase in volume during the breakout, confirming strong buyer interest. Volume remained steady during the retest phase, indicating that the price held firm despite the lower selling pressure. Technical Insights: Breakout Confirmation: A clean breakout above the neckline of the Cup and Handle pattern suggests bullish momentum, supported by rising volume. Retest and Bounce: The retest of the breakout zone has held, providing confidence that this level will now act as strong support. Volume Significance: The volume surge during the breakout is a positive indicator that institutional buyers may be driving the move. Sustained higher volume will be crucial for further price appreciation. 52-Week High: The stock is nearing its 52-week high, and a successful breach could lead to a strong upward move, with the next targets in the ₹800-820 range. Trade Ideas: Bullish: Enter on a breakout above ₹782.90, targeting higher levels around ₹820.00 and beyond, with a stop-loss below the retest level. Conclusion: This technical setup in Motilal Oswal Financial Ltd offers an attractive opportunity for bullish traders looking for continuation patterns. The clean breakout, successful retest, volume confirmation, and proximity to the 52-week high make this stock one to watch for potential long positions.
NSE:MOTILALOFSLong
by rajsharmatt
3
EWT – Can Bulls Push NSE JIOFIN to New Highs?Timeframe: Daily After hitting a low of 202.8, NSE JIOFIN has formed an impulsive cycle. Wave ((2)) has not retraced more than 100% of Wave ((1)). Sub-Wave (3) is a powerful extended wave, reaching 261.8% of the Fibonacci extension of Wave (1). The price has completed Wave (4) at 307, marking an exact 50% retracement of Wave (3). The impulsive structure is expected to resume following a breakout above the corrective slope. However, if the price encounters strong resistance at the upper channel, there is also a possibility of a triangle formation on the daily timeframe chart. The 337 level will pose a significant challenge for the bulls to overcome. According to the alternative chart, the price has completed Wave D at 337.95 and has begun forming Wave E. If the price doesn’t break below the low of Wave C, Wave E could alternatively be interpreted as a 1-2 wave formation. If price breaks out 338 , traders can trade for the following targets: 360 – 383 – 405 +. A breakdown of Wave A at 307 will require a reassessment of the entire wave structure We will update further information soon.
NSE:JIOFIN
by forextidings
7
ICICI Prudential Life Insurance - STOCK Analysis ICICI Prudential Life Insurance - STOCK Analysis This chart of ICICI Prudential Life Insurance (NSE) shows a strong bullish recovery: Key Observations: Current Price: The stock is trading at ₹767.60, down by ₹1.75 (-0.23%) for the day. Rectangle Pattern: The chart displays a double bottom pattern, similar to the previous chart of HDFC Life, where the price declined significantly twice and then bounced back. The highlighted box shows the price drop of ₹327.65 (-45.51%) and the subsequent recovery. Price Projection: The projected price move is indicated by the blue arrow, suggesting a 44.48% upside from the current levels, with a target price of around ₹1,100. Volume (CVD - Cumulative Volume Delta): The CVD shows 92.16K, indicating strong buying momentum, which reinforces the bullish trend. Fundamental Analysis of ICICI Prudential Life Insurance: Strong Market Position: ICICI Prudential Life is one of the largest life insurance companies in India, holding a significant market share with a wide customer base. It has a robust distribution network through ICICI Bank branches and other channels. Profitability: Net Premium Growth: The company has been recording steady growth in its premium collection, showing resilience despite market volatility. Solvency Ratio: As an insurance company, ICICI Pru Life maintains a strong solvency ratio, which is essential for long-term growth and policyholder trust. Investment Portfolio: Insurance companies heavily invest in various financial instruments, and ICICI Pru has a balanced and diversified portfolio in equity and debt markets. This helps in managing the risks associated with market fluctuations and improving returns. Competitive Edge: Technological Adoption: ICICI Pru has been leveraging technology to improve customer experience, with innovations in policy issuance, claims processing, and online platforms. Risks: Interest Rate Sensitivity: Like all insurers, ICICI Pru’s performance is linked to interest rates. Rising rates could affect investment portfolios and policyholder returns. Regulatory Changes: Changes in insurance regulations could impact the company’s operations and profitability. Overall Analysis: The technical chart suggests a strong bullish trend, with a potential upside of 44.48% if the projected pattern completes. Fundamentally, ICICI Prudential Life is in a solid position with stable financials, market leadership, and technology-driven growth. Long-term investors may consider this stock given its strong fundamentals and technical signals. However, investors should monitor macroeconomic factors like interest rates and insurance regulations.
NSE:ICICIPRULILong
by shivtoshiva2022
3
5 Important Lessons to Learn From the MarketsYou Can Never Outsmart the Market Detailed analysis 🧐and strategies are not enough to survive in the market. There are several other economic or geo-political factors that may influence the movement of the market. If market is flying higher due to positive factors, there is no point in going reverse and shorting stocks or indices. Conversely if the market is going down, its good to wait and watch rather than going all in. A popular saying that mostly works in the markets is that a trend🚀 may last longer than you can expect. Its Stock Market, Not Casino A few elements like risk management, position management, diversification, research etc. differentiate the Markets from Casino🤑. However, most new traders enter the market with a dream of overnight richness. Social media influencers add fuel to this fire and soon this fire🔥evaporates the entire capital of new traders. One needs to realize that the stock market is a business which will develop and grow gradually. Stock Market as Primary or Secondary Source of Income? People from mediocre business or salary class come to the market, make some money with beginner’s luck, become confident, keep increasing capital and become more and more confident😵. Ultimately, they start thinking of quitting their job or ignoring their business. But finally, the dooms days follow, and they start losing and losing till they lose it all. One may think of stock market as a primary source of income if one is profitable for at least a year (3 years would be good though🤔). Secondary sources of income are must because all traders lose in their initial phase. In fact, keep the market as a secondary source for 1-3 years. Stock Tips Will Burn Your Fingers Relying on stock tips from friends, news sources, or social media can be risky. Most tips are randomly picked without any research. Blindly following them without conducting your own research would lead to poor investment decisions and must financial losses. Most people have time⏳ constraints, but they must first learn the market nuances by using small capital and making small losses. Improve their knowledge for at least 3-6months and then go for some reliable advisory service. Do your own research on their tips rather than blind👩‍🦯 faith. Your Portfolio May Lag in a Bullish Market Rising market would not always lead to rise in your portfolio. Your portfolio performance may still be stagnant👎 even when the market is up by 15%👍. It all depends upon the performance of your stocks. Its always good to keep blue-chip or good midcap stocks in your portfolio. Generally, they will perform in-line with the indices. Investing in penny stock hoping for a lottery might be highly disappointing and may lead to further worst decisions in future. Self-education📕 is the best investment. I hope this small effort would help some new traders. All views are personal. Keep boosting 🚀for more educational content in future.
NSE:NIFTYEducation
by Bravetotrade
8
WiproDate 03.09.2024 Wipro Timeframe : day chart Remarks : Strong/Breakout 1 If breaks out from cup & handle neckline + 50% of fibonacci + resistance band of developing symmetrical triangle, that's a good breakout. Target could be 61% of fibonacci Weak/Breakdown 1 If breaks down from 38% of fibonacci + goes below handle + moves below support band of developing symmetrical triangle, that's a weak set-up. Target could be 23% of fibonnaci. *For swing support can take input of 20,60 & 200 ema combination. See if any divergence or convergence. Regards, Ankur
NSE:WIPRO
by AnkurSingh
2