Wednesday, September 9, 2009

AVOID TATA CHEMICAL FOR LONG TERM

sir i am holding 20 units of tata chemicals at 319.24 since 1 year. i am feeling myself in dark and dont understand what to do on my blunder.i am thinking to buy 20 units at current price with a view of correction as one of my friend adviced. with a ray of hope i am seeking your advice to cover my loss. sir pl recommend a share of around 100 rs. i will be heartily grateful to you sir..with due respect..suriya singhal
1. Tata chemical is a large cap company with a low promoter holding. Promoter hold 29.23 percent share and they pledged his 59.76 percent of total holdings. (We do not like company which promoters holding less then 35 percent or with pledged share.)
2. Debt/equity ratio in tata chemical is 0.95 so this is a normal debt company.
3. Book value of tata chemicals is 164.10 so this share is traded above his book value.
4. Year high of tata chemicals is 336 and year low is 100.
5. Current P/E of tata chemicals is 13.
6. We think one should AVOID tata chemicals and consider Aditya birla chemicals for long term investment (aditya birla chemicals book value is 102.60 current price is 70, year high 76, year low 24, P/E is 3.5, Promoter holding 56.31 percent, debt/equity ratio 0.19, small cap share and try to catch this share in next fall near about 60-65).
7. I think you may shift your current holding in aditya birla chemical and not to average out your holding in tata chemicals or tata chemicals is also not a bad company this is a dividend paying company and give you 90 percent dividend in FY 08-09 so you wait some momentum in tata chemical then book this share and invest aditya birla chemical al low price)
8. Aditya birla chemicals give 15 percent dividend in FY 08-09.
THIS ANALYSIS IS MAHESH CHANDER KAUSHIK OPINION ONLY NOT A PROFESSIONAL ADVICE SO READ DISCLAIMER BEFORE TAKE ANY ACTION.

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