to r ’s Focus

Inves -Madhukar Das

Issue 13, Vol 1

Godrej Industries
-April 29, 2011
As we approach current F&O series’ expiry there is a tussle between the bulls and the bears.
A few heavyweights in benchmark indices Sensex and Nifty like Reliance Industries, Infosys,
Wipro etc have brought a slide in market but the slide is restrained by a few other stocks. Other Picks
Sensex seems to swing up and down within a confined range and we are yet to see a definite
trend which may head either way. We can wait further for financial results and see how things BUY :
progress. Exide Industries
Fundamentally Speaking
CMP—`150.5
Godrej Industries Ltd is a part of the Godrej Group, which was established in 1897 and today
is worth approximately $2 billion. Godrej Industries is India's leading manufacturer of oleo- Target—`158
chemicals and produces more than a hundred chemicals for use in various industries. Godrej
group enjoys tremendous brand recall and trust across the country. The company owns a Stop Loss—`146
plethora of well known brands which are widely popular in India. Brands like Cinthol, Fair-
glow, Goodknight, Hit, Kiwi Brylcreem are owned by Godrej. In retail food segment Godrej
has rights to Hershey’s products in India and sells them under Godrej Hershey’s name. It also Acropetal Tech.
has a real estate vertical which engages in both residential and commercial projects. It has
CMP—`41.10
strategic land holdings and building projects in the pipeline. The company's products, apart
from being used in various Indian industries are exported to 40 countries in North and South Target—`43.40
America, Asia, Europe, Australia and Africa. Godrej Industries has also initiated investments
in its own subsidiary Godrej International Trading & Investments which will engage in inter- Stop Loss—`40
national investments.
The company is largely owned by the promoters (79.1%) but is a favorite with many mutual Sell :
fund houses. DSP Blackrock has invested in Godrej Industries through its various schemes
and holds shares worth `98.6 crores (as on March 31). Earnings and profit margins are Reliance Ind. Infra
higher than industry average. Although the sales growth have been stagnant but the upcoming
quarters are expected to yield better results. QoQ the company’s profit grew 47.67% over Q3 CMP—`646
last year. Target—`610

Technically Speaking Stop Loss—`666

Special points of in-

The price has broken up-
ward of consolidation pe-
riod forming bullish con-
tinuation triangle.
The momentum crossed 0
just before the price broke
upward. Thus supporting
the event.
Stochastic chart suggests
reversal from downtrend
and is in line with breakout.
Commodity channel index
also coincides with momen-
tum crossing the 0 level
suggesting the stock’s entry
in an uptrend.
William %R chart also suggests a
trend reversal with a very short
term double bottom. Therefore
there could be an upside of 4-8%
from current levels. There was a
doji on 25th which failed to re-
verse the trend and we may see a
doji again today.
Recommendation : BUY
CMP : `186
Target Price : `200
Stop loss : `179
terest:
Since we are looking
at a trading horizon of
15-30 days, we shall
give more weightage
to technical analysis
and price trend of the
stock.
We shall also study the
fundamental aspects of
a company to avoid
getting into loss mak-
ing trade positions in
case of movement of
market in direction
opposite to that of my
prediction.