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Home > Business > Stock Chat > Transcript
'Better days are ahead for Colgate'
May 10, 2005
JOEGRANVILLE : ramesh, what r u reading now a days???
Ramesh S Damani : Hello everyone thanks for joining, let's start.Generally catching up on some magazines.
maneeshk : Good afterroon sir, Indian Toners with a net profit of Rs 5 Crore on the equity of Rs 8 Crore which generates an EPS of Rs 6.25, the book value stands at Rs 22. The PE for a co. in this business is normally 15. Looks good at CMP of 19. Have you looked at it?
Ramesh S Damani : I have not. The logic seems there.
WARRIER : I MISSED BALMER LAWRIE AND INSTEAD BOUGHT INTO BALMER INVESTMENT,BUT IT DOESN'T SHOW ANY MOVEMENT,IS IT WORTH HOLDING ON TO?
Ramesh S Damani : It is an investment company and not operating hence price movement lags.
WisdomMan : There is a corporate development in the offing in Jindal Photo (CMP : Rs 313). FII, Prudential is mopping up huge quantities of Jindal Photo at current levels based on the information available to them. Would request to comment on Jindal Photo for the benefit of the readers.
Ramesh S Damani : I don't follow the company.
nimesh : Hi Mr damani, had the pleasure of interacting with you in Adv seminar of CNBC
Ramesh S Damani : Thanks for joining in.
Vatsal : Sir, What are your views on Midcap IT Companies, since there valuation is cheap compared to Large IT Companies. The Dividend Yield is also better. One such example is Blue Star Infotech [Get Quote] with Dividend Yield of 7%, if Div for 2003-4 is maintained. Is this not attractive for considering it is in IT business. For that matter in any business. Even if it declares Div % of 2002-3 the yield works out to about 5.85%.
Ramesh S Damani : It does. However, I think growth has been sluggish in the co hence the low discounting.
PKM : Sir, it is your advices which is delivering bumper fruits. Have very decent profits in TCI. Bought at 96/- 500 shares and still holding. Is it good to hold on?? I do have banco Products, Nucleus, Mid Day, EIH Associate, and Sh Rajasthan texchem.
Ramesh S Damani : These are generally good companies doing well.
Vatsal : I am a great admirer of yours, I have gained a lot � financially and otherwise from your advices. I have taken exposure in Linc Pen, Colgate and Tata Elxi following transcripts of your chats. Will the same story is possible in TV Today and VST Ind.
Ramesh S Damani : That is for the market to decide, I do like these companies.
coolrks : Hello Sir, This side rajesh singh , got your mail thanks for that. I have seen your interview taking stock .In that you metioned about logistci companies, is it viable to buy at current price and one more thing you mentioned mid cap Tech , other than Nucleus which one you suggest
Ramesh S Damani : I have been recommending Logistcs since six months. I like Tata Elxsi [Get Quote]. Among the smaller tech stocks make a basket of Encore, Logix and Virinchi. I own and trade in them.
yourstudent : sir good evening. i am in heavy losses. now i am afraid to buy any thing at this moment. do u suggest investors to get in stocks like tisco,telco,sbi,maruti. please reply sir
Ramesh S Damani : One must analyse and see why they made mistakes. Do some introspection.
WARRIER : UB holding ,a holding co is showing great promise,however balmer investments does not budge,your expert comment on this?
Ramesh S Damani : It takes time. Just because we buy it doesnt mean it moves. UBH was trading in a range for 2 years.
Sharad : SIr, What is the correct way of identifying a good comp, for long term investment..Low equity-High resv, with good sales & net increase or sales to mkt cap ratio ?? (what is ideal sales / mkt cap. ratio ) you normally look for????
Ramesh S Damani : Cannot be summarised in a few sentences. It takes a lifetime to become good at it.
Rajan : I missed the MCDowell,UB and GATI too. What is ur view on ur favourites TV Today,Bank of Punjab, Arvind products, Venkys and Mount Everest
Ramesh S Damani : They are all future players, keep an eye on them, but they are at the current time immature and volatile.
maneeshk : WODS....Next Gen, Maulik's interview was excellent... The guy was bang on.... amazing command over the language and clear thoughts. kudos to both of you for an excellent episode
Ramesh S Damani : It was a treat interviewing him.
SingaporeJB : Sir did you look at the Venky's result. EPS 17.76. Can we accumulate at current price?
Ramesh S Damani : Looks good to me.
theblues : i bought 8000 shares of Bank of Punjab @32.40 ten months back.How are the prospects for this bank? Can i hold or exit at this stage?
Ramesh S Damani : Over time they will be sold to a major bank in the West.
yourstudent : sir i want to join you as your student. can i join. sir i am a great admirer of yours. when ever i see you on cnbc i dont leave it. i am eager to join you. my email is ddrpk@yahoo.com. can i join you sir... please reply sir
Ramesh S Damani : Unfortunately I am not hiring.
RKSingal : BALMER LAWRIE:- I think it Should surprise us on the upside. Looking at their Logisitics business the operating profit out of this business would be more than 52 crores for the whole year. Their CFS at Kolkata is a clear monopoly and with trade from China growing do you see good upside in that ?? Looking at the valuations of GATEWAY DISTIPARKS i think Balmer Lawrie is cheap. Their Logistics business only should be valued more than the current market cap of 450 crores. After the Q4 results if they comes in line with the exepectaions (i.e. consolidated net profit of about 40 crores), would you recommend adding it at the current levels ???
Ramesh S Damani : I dislike commenting at every price on the future. My preference is known.
coolrks : Sir , i did had the Gati and sold at 188. I just want to know whether should i take the position now also. Nucleus i have taken and kept it for a while now.
Ramesh S Damani : I would hold on to Nucleus.
ramk : Ramesh, thanks for your great advice on TCI. I am sitting on good profits. Would like to buy more? Do you still think steam is left in this?
Ramesh S Damani : Don't try and time the market.
romit : Sir, I meet you quite often due to my profession. But i never ask you any question on stocks i own as i feel it is not good. I do own TCI but do not know when to exit. I do not have any need of money. can you say this today??
Ramesh S Damani : Where do we meet? I remain bullish on logistics.
SCRIPPY : Respected Sir,I have been a follower of yours for a few months. I had asked you about Todays Writing Products when it was priced at 35 levels. I had felt a hundred percent appreciation from those levels. But you were not very convinced. However I went on and invested as in your chats you also tell us that 'If you have the conviction invest". It feels great Sir when my targets were acheived and my calculations came true. Thanks a lot Sir for the confidence.
Ramesh S Damani : Good luck and continue to invest with conviction. Remember, it should not be price appreciation alone that brings conviction.
bc : There is a Morgan report that says Rupee appeciation possibility is practically nil. In that context, don't u think IT companies (especially smaller ones that can grow faster), are a trifle undervalued?
Ramesh S Damani : I have not seen it. Sounds interesting.
ahmedabadguys : Sir Gati has been in news after ET broke news about possible buyout by TNT..Company denies the news item..Do you see Gati can fetch 500 cr. as valuation going by your experience in following this kind of compnies????
Ramesh S Damani : I am not sure it is for sale. If it was it could get a good management premium. Exact figure is hard to say.
Vatsal : Do ill liquid shares gives better return in long term if the Company / industry starts performing. During last few months return from DISA India [Get Quote], Linc Pen were almost 100%. Am I thinking on the right track.
Ramesh S Damani : Do your homwork, get the company right the rest works out.
Rajan : I prefer buying small shares in good volumes and hold. Am I right. Or MidCaps are the best. What is is ur opinion.
Ramesh S Damani : The best is being good shares at a discount to value, (mid, large,small is not relevant).
ahmedabadguys : Sir have you looked at Thirumali chemicals..This year topline growth 30% .5 rs. div. last year. prise 125..good mangement...your views please
Ramesh S Damani : I think sister company ULTRA marine is having a great run.
chandani : sir you ha d suggested SIMPLEX CONCRETE BEFORE ABOUT 8 MONTHS i did buy but exited at around 150 i know it is futile to repent as it is sheer LUCK to earn in this market [more] so which are the companies you can suggest which we can keep for LONG time//???
Ramesh S Damani : Keep reading the transcripts for any new ideas.
sree : sir u r take on patel-on board undervalued stock as compared to blue dart and gati .bv is 48 cmp is 22 trading at p/e of 6.6. u r take please
Ramesh S Damani : It is a weaker company.
Singaraju : NUCLEUS is quoting at fy05 be of 14-15.What is the forward be(fy06) in your openion?
Ramesh S Damani : They are doing well. I don't have exact estimates.
rkjod : Sir few months ago you have suggested Caprihans India [Get Quote] (Pharma Packaging) since I am tracking it. It's moving between price band of 57 to 66. Still is it a good buy ?
Ramesh S Damani : Looks okay to me.
JPJ : sir i personally understand and feel that concor will double from current levels in the coming yr or two...sir ur view would be highly appreciated
Ramesh S Damani : Stock remain cheap. However remember who is the railway minister. At these market caps we have to be cautious.
TINU : sir, why do you think mount everest is good bet with 1-3 years prospective. any main reason which we have not figure it out. thanks
Ramesh S Damani : Building a brand and one of a kind water source.
rajiv : Sir, you are recommending Banco products?? It is a gujarat based co and all gujarat cos are facing tough times due to non implementation of VAT. don't you think i will have a clear impact on banco too??
Ramesh S Damani : Difficult to say over a quarter or 2 what will happen. You have to take a view.
rags : Rameshji, The indian warren buffet , can u please let me know regarding Gillette, buy, sell,hold
Ramesh S Damani : If I don't own it I would own it.
vavnathan : Mr.Ramesh, what is yr view on SKF open offer, whether one can exit through open offer or wait? pls repy
Ramesh S Damani : I can't decide that, however you shoould get a price greater than market price.
ramank : Dear Sir, Bayer Diagnostics, constant sales growth from past 10 years, const EPS growth from past 10 years. But its EPS growth in last 5 years was slowed down, and I see in this year again it picked up with EPS Growth of 9%, EPS Growth from 1995 to 2004 is 28% CAGR. Its Cash Reserves translate to 200 per share. No debit. It is in Health Segment. Book Value at 200+, current price is at 370. Looking all these, I feel this should do well in next 5 to 7 year time frame. Please provide with your comments. Thank you Sir.
Ramesh S Damani : Unfortunately I am not following it.
SA 2 : UBH / MCDOWELL : Enough already discussed , just wanted to know your gut feeling whether United Spirits [Get Quote] would be sold over USD 2 billion as indicated by Mallaya itself and thus Mcdowell / UBH heading for 4 figures
Ramesh S Damani : I wish I had a crystal ball.
chandani : sir BEML each upper movement meets with selling is it a hold or exit??
Ramesh S Damani : It has gone up from 340 to 600 in this move. Give stocks time to consolidate.
same views : Honeywell [Get Quote] doing well, what is your views on YOKOGAWA INDIA, they are in same field, yesterday YOKOGAWA announced that it will considerGiving dividend after 4 years. I own it, your views?
Ramesh S Damani : All companies related to capex are doing well.
RKSingal : COLGATE:- on CNBC you were recommending COLGATE. Have not heard of it in your chats earlier. Is it your new idea or just a better pick in FMCG space as compared to others?
Ramesh S Damani : I have been bullish on it generally.
minaliamin : HI THERE THIS IS AMIN.. HOPE U R DOING WELL WAS IN A CONF WITH HOTEL LEELA WHERE THEY GUIDED A 40% TOPLINE GROWTH AND A TRIPLING OF PROFITS.. ANY VIEWS
Ramesh S Damani : Hotel industry continues to look good and boom. Remain invested.
RKSingal : Teledata informatics [Get Quote]:- Education and Shipping software company showing good growth. Topline has grown from 60 crores last year to 220 crores. Net profit increased from 5 crores to 70 crores.Current Market cap is 380 crores. Your views on this mid cap technology company.do you like any of these at cuurent prices. SAMTEL INDIA [Get Quote](Holding co of SAMTEL COLOR [Get Quote]), OPTO Circuits, Orchid pharma, Adlabs [Get Quote]??
Ramesh S Damani : I can't understand the results of Tele Data? I like Opto.
bc : Sir, so you think small and mid cap companies which are not Mumbai based suffer because of lack of information dissemination to investors?
Ramesh S Damani : All small companies do. They are not covered well.
ms : between UBH and Mount Everest which one will u choose?
Ramesh S Damani : Can't compare the 2.
may : Sir, S&P given junk rating to GM and Crisil has put GMSE under watch any worries for Nuclious...Plssssssssss......reply.....
Ramesh S Damani : No.
Singaraju : What is the weightage of nucleus in your overall portfolio of stocks?
Ramesh S Damani : Why should that be important.
may : Sir, Your views about Venkey India after latest result....last quarter EPS Rs.7, full year EPS Rs.17 and Rs.3.5 Dividend, looks like it should go up substantially, your views....Plsssssssss......reply
Ramesh S Damani : Looks attractive to me.
WantToInvest : Rameshbhai, with tax relief available on MF investments, would you suggest some that one could look at? Pls excuse if this query is out of line. Thanks.
Ramesh S Damani : I prefer discussing stocks to MF. However it is good for some.
rajiv : You already recommended EIH. I went through its workings. Not so impressive but they have prepaid some loans with penalty to get rid of the. last quarter was profitable. management good. Mar cap low. But what about its future working sir?? they have only two hotels but of course with big brand - hilton??
Ramesh S Damani : Look at mcap. I think ITC is itching to take them over.
same views : Dear Sir, I want to know about implication of rate hike of diesel on TCI.I own it, bought it at 87.2.
Ramesh S Damani : Clearly it can't be helpful.
abcd : sir,any idea KRONE.??? INT.TRVL.???
Ramesh S Damani : I would take a look at them.
vikrantgoyal : do u publish your own research reports ? or analyse and give hints through mouth /chats ?
Ramesh S Damani : No, I keep looking for ideas.
RKSingal : WATER Sector:- You have been studying it. Any new pick in this sector(only pick i know is MOUNT EVEREST).
Ramesh S Damani : No other picks at this time.
pongo : Sir I hold 150 shares of Colgate bought by me in 1997/98 at 220 levels.Should I hold on to It, as for the last 7 years there has been no appreciation in my investment other than the regular dividend given by the Company
Ramesh S Damani : I think better days are ahead for Colgate.
RKSingal : AEGIS LOGISTICS [Get Quote]:- Do you see immense growth in their business or it is just a trading call. Their Oil logistics business has whopping 70% operating margin. Do you see significant growth in this segment ??? what was the objective behind the recent buy-back???
Ramesh S Damani : I think it may be more than just a trading call. However be patient in the investment.
SA 2 : Is there any value basket left like the one u suggested long back for Goldiam / Godrej [Get Quote] / Opto .
Ramesh S Damani : They have had a good run.
Shailesh : Sir, In your Taking Stock on CNBC you recommended Logistics. What's exciting about logistics NOW. your recommendation of TCI was just wonderful?
Ramesh S Damani : The reasons are outsourcing, growth in trade (China), removal of textile quotas, golden quadrilateral, growth in GDP all contribute to strong growth.
RKSingal : SHAW WALLACE [Get Quote]:-The Jumbo group is recent exiting all its business in INDIA. Any other company of jumbo group(they have a number of small companies in differnt business areas) where you see the value can be unlocked. Stake sale in HINDUSTAN DORR OLIVER has given a very good return to the people. Your comments on NARMADA GELATINES [Get Quote]. It has 2000 tone gelatine plant and last year rallis plant of this cpaicty was bought at 47 crores. Market cap of NARAMADA GELATINES is 20 crores.
Ramesh S Damani : I am not up-to-date on the group.
SA 2 : VIRNICHI: 2 months back it was recommended by my broker at 19 and i left it thinking as normal tip , really surprised to hear from u , whats special about this co. which makes you take position in the scrip.
Ramesh S Damani : It is part of a basket I am buying, it is too small a company at this time.
maneeshk : In water... Ion Exchange could be a multibagger but they lack aggression and vision... what do you say?
Ramesh S Damani : I think you are right.
ruthwick : Do we have any companies like Starbucks in India??
Ramesh S Damani : Not at this time.
jd : sir, i am sure you must be knowing a co. called paharpur cooling. it holds a stake in a co.called industrial & prudential(promoters of KSB PUMPS [Get Quote]). do you see any possible way the co.can be related valuewise to paharpur?
Ramesh S Damani : That would depend on the family.
scmishra : Sir recently I met my friend an Executive Engr in a State Govt ,he just looks like u,when I told this to him;he replied that may be correct but tell Mr.Damani to find replacement to the words ;My sense is that'' he uses so frequently
Ramesh S Damani : He is observant. I agree with him. I catch my self using it in many interviews. It reflect a cautious bent when speaking in public. My view ... not necessarily the facts. Good observation.
sanujkadavil : sirvenkys also looks to break its majot hurdle of 100. ones it breaks 100 levels , looks chart a huge surge to 300 levels canot ruled out, a strong fundamental will also justfy the move, DIVIDEND YIELD FUNDS DEFINITELY LOOK THE STOC
Ramesh S Damani : It is attractively priced at this time.
sanujkadavil : sirgodrej still looks good. even at 700cr mkt cap. getting 13%in GCPL,20%in godrej saralee, 12%in cbay syatems, 57% in godrej agrovet, 83% in godrej properties, 70% in godrej tea, 3% in avestha, etc. even its core business chemicals can value 700cr. so we are getting whole other prized assets freely
Ramesh S Damani : Let's wait for Q4 results and dividend pay out before we make a further call.
ramank : Sir, Peter Lynch says in his book "one upon the wallstreet", out 1400 stocks he olds, 99% of the corpus is in first 500 Co's. So it mean 900 stocks have only 1%. So if you also give, in what % we have to buy your stocks, It gives more insight to the stock. Thank you Sir.
Ramesh S Damani : Unfortunately I like to keep that private, it is a core holding though.
pongo : Why would the Agarwal family want to sell Gati to TNT, when they are doing very well and if they sell, what would they do with the funds they get.Sit pretty on the funds or start some new venture
Ramesh S Damani : That they can answer. Money is a great motivation for all of us.
jd : your weekend show WDS is excellent. especially the last episode with maulik sharedalal. could u tell us who is your next guest?
Ramesh S Damani : Thanks. Maulik is very articulate. Dinshaw Irani is my next guest.
simplify : A lot of people asking u about McDowell. What I did personally - due to price appreciation, it had grown to over 13% of my portfolio. Hence, booked partial profits to recover my invstement + make some decent tax free profits..also brought it down to about 8% of portfolio. Remaining am holding on for the value unlocking which may take time.
Ramesh S Damani : Good, I am glad you are taking charge of your financial health.
Amitabhuk : u tell about to wait for q4 result but will that not be past once company results r declared nd stock investing is more of future predictions!!
Ramesh S Damani : Yes, but it is a reality check.
maneeshk : Am reading The End of Future by Jean Gimpel... interesting and radical thoughts. you will like it.
Ramesh S Damani : Thanks.
JOINMANISH75 : SIR, I HEARD U IN UJJAIN FIRST TIME LIVE, I AM VERY GREAT FAN OF U, I WOULD LIKE TO KNOW THAT WHAT IS THE FUTURE OF POKRAN LTD.
Ramesh S Damani : Unfortunately I don't follow it. Thanks for coming.
sanujkadavil : SIRmallya says 70% of united spirits will hold by ub holdings,how this will happen, mcdowell wil have to issue shares for 25% in herbertsons shares held by ub holdings, then how this can be possible
Ramesh S Damani : Merchant bankers are creative, we have no control over the process.
SA 2 : DATAMATIC TECH : Now in 2 digits , would u like to add as BPO is stilkl your favourite
Ramesh S Damani : The company has been consistently disappointing
ADS : Sir have any ex-presidents of BSE made it to your show ? Whom would you rate as the best president in the history of BSE ?
Ramesh S Damani : KPR Shroff maybe, Jeejabhoy before my times though.
rajivkh : Sir the ITC interest on EIH asso. is only reason to recommend it??
Ramesh S Damani : They are interested in EIH not EIHA.
simplify : Sir - I have been mentioning this many times..but not getting your attention. Take a look at NIIT [Get Quote] Tech. Not a great company I agree but the valuations are screaming. 4% Div yield and P/S of 0.8 - this for a 500 Crore company. Mgmgt has gone on record that they are looking for a strategic investor. I think this will be a common theme among small cap IT.
Ramesh S Damani : I will take a look at it.
sanujkadavil : sirVENKYS attractively priced means gives a buy opportunity???
Ramesh S Damani : Yes, I own it already.
pongo : TCI is a very large Transport Company and doing well also, but they lack the dynamism to carry the same forward as most of their top level executives are from the old school of thought and dont have the vision to carry the Organisation to greater heights baring Vineet Agarwal who has the vision to make the Organisation a dynamic one
Ramesh S Damani : Clearly it belongs to him. Thanks all for joining. See you next week. Bye.
SA 2 : MCDOWELL : Dont you beleive that Mcdowell from this level can surprise at the time of stake sale because if it sells between 1-2 billion , at 100 cr. merged equity of US , we can get between 500-1000 ? am i right
Ramesh S Damani : That would be a fairy tale ending.
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