Godrej stock is a good investment

Godrej stock is a good investment

By Rajiv Kapoor | 10 October, 2015
Godrej Industries Ltd is part of the $1.8 billion Godrej Group operating in diversified fields like real estate , FMCG goods, finance and chemicals. Godrej Industries makes more than a hundred industrial chemicals for over two dozen industries and also manufactures edible oils and vanaspati. The company has a strong manufacturing base with plants in Gujarat and Mumbai capable of delivering international quality products across 40 countries. The company’s subsidiary, Godrej Nature’s Basket, is India’s foremost retail destination for fine, gourmet food and beverage from across the world and is a major lifestyle changer . The response has been quite phenomenal in the urban centres and the company is planning to open around 45 new stores across major cities in the country in the next one year. Godrej Industries has bettered its Q1FY2016  performance with sales at Rs 2,565 crore and net profit for the same period at Rs 94 crore. The company will be meeting on 6 November this year to take on record the Q2 FY2016 unaudited financial results and analysts are betting that they will be better than expected. 
The Godrej Industries stock currently trades at Rs 360 and is in a consolidation range for some time and seeing lot of built-up addition in the stock. Within the mid cap space ,Godrej Industries Ltd stock is a strong buy at the prevailing market rate with a target price of Rs 460 for medium term investment horizon. Nucleus Software Ltd has recently formed a strategic partnership with Microsoft to deliver the latest version of the best selling lending software in the world called Finn One Neo on Microsoft Azure. The company is quite bullish about this partnership as this cloud service will provide banks and financial services companies with a much needed lending platform that is secure, scalable and responsive to the changing customer demands. Nucleus Software’s Finn One product has been ranked Number 1 best selling lending system by the International Banking Systems for the 7th year in a row and should drive the next wave of growth in the banking industry. Nucleus Software is a leading provider of critical lending and transaction Banking products to the global financial services industry. Its software powers the operations of more than 150 customers across 50 countries supporting retail banking, corporate banking, cash management , Internet banking and automotive finance. The company reported a consolidated total income of Rs 85 crore and a net profit of Rs 6.79 crore for the quarter ending June 2015. The management feels that the strong set of quarterly earnings have been due to the transformation initiatives taken by the company in building up leadership teams outside India , opening up new offices abroad and ploughing back the surplus into the business. It also expects net sales and profit to grow over 12% in the next few years while earning per share for FY16 and FY17 is seen at Rs 22 and Rs 24 respectively. The Nucleus stock is an excellent buy at the current market price of Rs 260 for a target price of Rs 350 in nine months time frame.
Rajiv Kapoor is a share broker, certified mutual fund expert and MDRT insurance agent.

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