Saturday, October 21, 2017

Parag Milk Foods Ltd @ 273.40

1. Parag Milk Foods Ltd is a 10 rupee face value dairy/packaged food company.
Security ID: PARAG MILK  Group / Index: A / S&P BSE 500  Face value: 10.00  Security Code: 539889  ISIN: INE883N01014  Industry: Packaged Foods.

Brief Details of Company:- Incorporated in 1992, Parag Milk Foods Ltd, is Pune based dairy-based branded food producer. The company is involved in the collection, distribution of milk and producing dairy-based branded consumer products including cheese, ghee, whey proteins, paneer, curd, yogurt, milk powders and dairy-based beverages. All products of the company are made from cow milk.
Company's manufacturing facilities are located at Manchar in the Pune district of Maharashtra and Palamaner in the Chittoor district of Andhra Pradesh. Company's supply chain network includes procurement from 29 districts across Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu, through over 3,400 village level milk collection centers. Parag Milk Foods Brand and product lineup under them:
1. Gowardhan
Gowardhan brand is targeted at household consumption and to be used as cooking ingredients. The products under this brand include fresh milk, curd products (curd, trim curd and buttermilk), ghee, paneer, butter, milk powders, whey proteins, gulab jamun mix, and shrikhand.
2. Go
Targeted at children and the youth generation, primarily for direct consumption. The products under this brand include cheese products, UHT milk (go milk, go slim milk and go supremo milk), fresh milk: go kidz, fruit yogurts in six flavors, fresh cream and beverages (lassi and buttermilk in two flavors).
3. Pride of Cows
The farm-to-home concept of milk, directly delivered from the farm to a consumer's door-step, through a subscription model. Targeted at household consumers seeking premium quality cow's milk. What the product includes under this brand is cow milk.
4. Topp Up
Targeted at the youth generation and travelers as a source of instant nourishment. The products under this brand include flavored milk in six flavors.
Competitive Strengths:
1. Well Established Brands Targeting a Range of Consumer Groups
2. Integrated Business Model
3. Diversified Product Portfolio and Customer Base
4. Growing Pan-India Distribution Network
5. Established Track Record of Growth and Financial Performance
6. Experienced Senior Management Source:-http://www.chittorgarh.com/ipo/parag_milk_ipo/545/ Company website:-http://www.paragmilkfoods.com/ 
2. Year high of Parag Milk Foods Ltd is 328 year low was 203 and stock traded at 273.40.
Year high/ low ratio is below 2, If you read my research terms or my book then you may know that generally, I like a stock which year high/low ratio is below 2 but if stock recently gives a positive result then this ratio is acceptable till 2.5.
If you are new reader of my blog and not familiar with my research terms, then please see my research terms at this link:-
3. Promoters of Parag Milk Foods Ltd hold 48.70 % and Promoters holding is good, but promoters pledged 15.82% stock. Promoters continue to increase his stake Q on Q basis from 47.48% to 48.20% to 48.70% now, and you knew I like increasing promoters holding it shows the confidence of promoters in his own company.
DII and FII holding:-
4.Parag Milk Foods Ltd Parag Milk Food Ltd give 0.50 paisa dividend for this year so as per my rule I like dividends paying company because I got dividends in my holding periods.
5. Parag Milk Foods Ltd  listed on 19.05.2016, So sufficient 3 years data not available for base price calculation but from listing to today, the average price of all available 354 days is 264.28 
So we consider this 264.28 as the partial base price of the stock.
Parag Milk traded near 3.45% above from this partial base price and as my rule for trading stock we buy a stock 20% below to 20% up from base price, however,  this is a partial base price due to the new listing. 
6. In Dec 2016 two bulk deals recorded in Parag milk see details of this bulk deal:-
Here you find FII Sell some of his holding to New Horizon Oppturtinies Marter Fund and when we check FII and DII holding we find this fund still hold these shares and other funds also hold this stock:-
So In my view this type of bulk deal is risk-free. 
7. Parag Milk Foods Ltd net sale per share of FY 16-17 is 202.23.
8. Net sale per share 202.23 is below from CMP 273.40, but you knew for trading stock I allow CMP till 1.5 times above of net sale per share.
9. The book value of Parag Milk Foods Ltd is 78.16 Book value is also below from CMP but for trading stocks (20% gains in 7 days to 3 months) we not worried about low book value however you must avoid a stock with negative book value.
8. Finally, I choose Parag Milk Foods Ltd as my trading stock for 20%+ gain.
9. 200 DMA of Parag Milk Foods Ltd is 242.16 So at CMP 273.40 Stock recently cross his 200 DMA, So I choose this level for my recommendation.
10. Target:- 20% + from 273.40 or 20% + from Monday 23 Oct 2017 Closing Price (Whichever is higher).
It is advisable to invest a low amount in every trading stock, If stock open high on 23 Oct 2017 then wait to cool down, do not worry about miss the rally because I also buy my own stocks 5 days after publishing of my report.
I also miss genus paper, but I wait for next opportunity like cubex tubings, I publish cubex tubings research report on 1 June 2017 @ 14.00 and unable to buy at my own recommended price because stock touch 25+ within 19 days of this report.
But we have a lot of patience and faith, so me and my wife both buy cubex tubings on Aug 17 near 16-17 price and my wife booked her profit near 22 and I am still holding cubex tubings and not sell until Aug 2018.
Stop Loss:- If in any unfortunate situation stock close 5% below from his 200 DMA and year high/low ratio change above 2 then you may book your loss as per reverse trading system but if you invest a small amount then no stop loss will need like this chinki story:-

How Chinki Earn INR 4,73,90,45,652 from Initial investment of INR 6600

Part 3 of above Chinki Story will be updated in Nov 2017
Now I want to hear your voice in comment:-
11. Disclaimer:- This is not an advisory service to buy or sell. The contents of “this research report” are only for educational purposes. No liability is accepted for any content in “this research report.” The author is neither a registered stockbroker nor a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity, index or any other financial instrument at any time.The author recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions. Please read full disclaimer at the bottom of my blog.
12.Discloser:- I Mahesh Chander Kaushik author of this research report is an existing research analyst and passed NISM certification for research analysts. I am also registered with SEBI(RESEARCH ANALYSTS) REGULATIONS, 2014 ( SEBI Registration Number INH 100000908 ) hereby disclose about my financial interest in the subject company and the nature of such financial interest:- 1 Me and my associates or relatives have not held any share of Parag Milk Foods Ltd so my personal interest is not included in this stock. 2. Me and my associates or relatives have not any actual/beneficial ownership of one percent or more securities of the subject company ( Parag Milk Foods Ltd). 3. Me and my associates or relatives have not any other material conflict of interest at the time of publication of the research report. 4. Me and my associates or relatives have not received any type of compensation from the subject company(Parag Milk Foods Ltd) in the past twelve months. 5. I am not served as an officer, director or employee of the subject company ( Parag Milk Foods Ltd). 6. I have been not engaged in market making activity for the subject company (Parag Milk Foods Ltd).

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