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RAJIV KAPOOR
TAKING STOCK

Rajiv Kapoor is a Share Broker, Certified Mutual Fund Expert and MDRT Insurance Agent.

Blue Star is a good stock option

Blue Star Ltd, India's largest central air conditioning company, with an annual turnover of Rs 3,000 crore, has its businesses spread across seven manufacturing facilities, 2,000 dealers and over 2,500 employees. It has interests in commercial and residential air conditioning and refrigeration, apart from electrical contracting and plumbing and fire fighting services. The company also markets and maintains electronic and industrial products. Blue Star is closing down the bulk of its legacy projects that were hurting its growths. Similarly, the company has closed its manufacturing facility at Thane, Maharashtra in August due to high manufacturing cost thereby saving substantial sums by way of interest outgo. During the last couple of years, profit margins have improved considerably and hence the company has come into the buy radar of many equity fund managers.

While the last quarter numbers were decent, the company has shown a stellar 95% growth during the Onam festival and if this is anything to go by then the upcoming festive season of Diwali, Dusshera and New Year can be a bumper quarter. With a market cap of Rs 3,000 crore and a P/E of 20, investors looking at steady appreciation in their portfolios can invest in the company's stock currently quoting at Rs 345 for medium investment. The stock can give a healthy 25% appreciation over the next nine months time horizon.

Rajiv Kapoor is a share broker, certified mutual fund expert and MDRT insurance agent.

 
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