Birla, cairn India are right investments

Birla, cairn India are right investments

By Rajiv Kapoor | 19 January, 2013

Aditya Birla Nuvo Limited is a $4.5 billion diversified business conglomerate, which is present in financial services, telecom, manufacturing ,IT and Fashion. Any management push by way of any restructuring or demerger can unlock its true value and release fantastic wealth to its shareholders.

Financial services constitutes of Birla Sun Life Insurance, Birla Sun Life Mutual Fund, Aditya Birla Finance and Private Equity and Securities businesses. On the other hand, the retail business has solid labels such as Allen Solly, Van Heusen, Peter England and Louis Phillipe under its belt. It also holds a 25% stake in Idea Cellular.

The stock strategy would be to buy a small quantity now at the current price of Rs 1,125 and more in the next two months for a price target of Rs 2,000 in a year.

Cairn India Limited is another good option. It is the only unregulated play on energy in India and its Rajasthan block is producing 20% of the domestic oil production. Moreover, the company stands to gain significantly from the likely production increase over the next two years as new international exploration programmes underway in Sri Lanka and South Africa will contribute in a big way to the total revenue. Since all these factors are not priced in the stock at present ,Cairn India quoting at Rs 330 and is tipped to be a super performer at the current price for a 18 months price target of Rs 600.

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