Big Bull Portfolio: This multibagger stock doubled shareholder money in one year! Is it still worth buying?
The stock rose 7 per cent to hit an intraday high of Rs 96.8 on the Bombay Stock Exchange (BSE) on Tuesday.
- Dec 7, 2021,
- Updated Dec 7, 2021 2:39 PM IST
The stocks of market mavens of Dalal Street are widely tracked by investors. Shares of National Aluminum Co. Ltd (NALCO), a part of Big Bull Rakesh Jhunjhunwala's portfolio, have delivered a multi-bagger return to its shareholders in the last 12 months. The stock rose 7 per cent to hit an intraday high of Rs 96.8 on the Bombay Stock Exchange (BSE) on Tuesday. With a market capitalisation of more than Rs 17,500 crore, the shares stand higher than 5 day, 100 day and 200 day moving averages but lower than 20 day and 50 day moving averages. In the past one year, the share price of NALCO jumped from Rs 43 to Rs 96.80 mark ---- logging around 125 per cent return in this period. Here's what experts say! "The valuations are attractive and this is the right time to buy the stock. A 20 per cent upside from its current price is expected in the upcoming quarters," Sonam Srivastava, Founder, Wright Research told BusinessToday.In. "Thus, there is a positive and favorable outlook for Nalco following the Q2 results, based on the forecast of increased aluminum demand in the near future. Aluminum is predicted to see a slowdown in new capacity expansions in China, while demand is expected to remain high," she added. According to Dr. Ravi Singh, Vice President & Head of Research, ShareIndia, Aluminium demand has seen a surge in the overall consumer sector. High prices of both alumina and aluminum have benefited NALCO to register a growth of 783 per cent in the first half of 2021. "The sharp domestic demand recovery is well reflected in the company's robust sales figures. The investors may enter long in NALCO around Rs 90 levels for the target of Rs 110-120 in near terms," he added.
"Investors are keenly taking note of inflation and diversifying their assets to hedge inflation. For NALCO, given they’re the lowest cost producer of Bauxite and an aluminum producer, we expect their earnings to further improve in line with inflation," Divam Sharma, Co-founder, Green Portfolio told BusinessToday.In.
"Compared to its peers, NALCO is trading at an attractive valuation of 11x price/free cash flow, when Hindalco is being exchanged at double this valuation," he noted.
"Further on, we expect the latest drive to privatize NALCO and Hindustan Copper will further help in unlocking value for existing investors," Sharma added. Q2 earnings NALCO posted stellar earnings for the quarter ended September 2021. The company reported a more than sevenfold jump in its net profit at Rs 748 crore for the quarter ended September 2021. Profit in the year-ago period stood at Rs 107 crore. The total income increased to Rs 3,592 crore from Rs 2,375 crore in the year-ago period. Big Bull stake
This is a fresh investment by Dalal Street veteran Rakesh Jhunjhunwala, whose name was not there in the list of big shareholders in the previous shareholders' data.
According to the shareholding pattern for September 2021, Rakesh Jhunjhunwala held a 1.36 per cent stake or 2,50,00,000 shares in the company. Nalco is a Navratna CPSE under the Ministry of Mines. The company has integrated and diversified operations in mining, metal and power. The Centre holds 51.28 per cent equity of NALCO.
The stocks of market mavens of Dalal Street are widely tracked by investors. Shares of National Aluminum Co. Ltd (NALCO), a part of Big Bull Rakesh Jhunjhunwala's portfolio, have delivered a multi-bagger return to its shareholders in the last 12 months. The stock rose 7 per cent to hit an intraday high of Rs 96.8 on the Bombay Stock Exchange (BSE) on Tuesday. With a market capitalisation of more than Rs 17,500 crore, the shares stand higher than 5 day, 100 day and 200 day moving averages but lower than 20 day and 50 day moving averages. In the past one year, the share price of NALCO jumped from Rs 43 to Rs 96.80 mark ---- logging around 125 per cent return in this period. Here's what experts say! "The valuations are attractive and this is the right time to buy the stock. A 20 per cent upside from its current price is expected in the upcoming quarters," Sonam Srivastava, Founder, Wright Research told BusinessToday.In. "Thus, there is a positive and favorable outlook for Nalco following the Q2 results, based on the forecast of increased aluminum demand in the near future. Aluminum is predicted to see a slowdown in new capacity expansions in China, while demand is expected to remain high," she added. According to Dr. Ravi Singh, Vice President & Head of Research, ShareIndia, Aluminium demand has seen a surge in the overall consumer sector. High prices of both alumina and aluminum have benefited NALCO to register a growth of 783 per cent in the first half of 2021. "The sharp domestic demand recovery is well reflected in the company's robust sales figures. The investors may enter long in NALCO around Rs 90 levels for the target of Rs 110-120 in near terms," he added.
"Investors are keenly taking note of inflation and diversifying their assets to hedge inflation. For NALCO, given they’re the lowest cost producer of Bauxite and an aluminum producer, we expect their earnings to further improve in line with inflation," Divam Sharma, Co-founder, Green Portfolio told BusinessToday.In.
"Compared to its peers, NALCO is trading at an attractive valuation of 11x price/free cash flow, when Hindalco is being exchanged at double this valuation," he noted.
"Further on, we expect the latest drive to privatize NALCO and Hindustan Copper will further help in unlocking value for existing investors," Sharma added. Q2 earnings NALCO posted stellar earnings for the quarter ended September 2021. The company reported a more than sevenfold jump in its net profit at Rs 748 crore for the quarter ended September 2021. Profit in the year-ago period stood at Rs 107 crore. The total income increased to Rs 3,592 crore from Rs 2,375 crore in the year-ago period. Big Bull stake
This is a fresh investment by Dalal Street veteran Rakesh Jhunjhunwala, whose name was not there in the list of big shareholders in the previous shareholders' data.
According to the shareholding pattern for September 2021, Rakesh Jhunjhunwala held a 1.36 per cent stake or 2,50,00,000 shares in the company. Nalco is a Navratna CPSE under the Ministry of Mines. The company has integrated and diversified operations in mining, metal and power. The Centre holds 51.28 per cent equity of NALCO.