Before Diwali, our market indexes indicating that overall market is now trading at a new lifetime highs. On Friday trading session, Airtel-Tata tele merger boosted the whole telecom space. Many new stocks were seen to be very on same day session.
However today i am writing this post to share my views on companies having high-debt levels making them among top stocks at 52 week low.
First name from this list includes Videocon Industries. It is a consumer durable company having product portfolio from television, washing machine to mobile phone. Recently, company was entered into business of security segment through its subsidiary Wallcam which manufactures security cameras. However, Stock price has already slipped more than 80 percent this year after classification of its borrowings as NPAs by its lenders. But a great name of Videocon Group in our country has give another chance to promoter as banks have no issues on continuing business activities throughout the country without any restrictions.
I believe company is still at that stage, from which they can again determine their future possibilities. Company have already sold their telecom business earlier for a clear exit from loss-making business. Exploring profitable businesses like security segment where future looks great, i think Videocon is going on a right path. Kenstar has also been putted on sale from Videocon. I think if company doesn’t face the same situation as it faces high losses in telecom business again, then we could see some improvement in financials of the company in future. Although, i think stock may give multibagger returns in long-term if all the things go in positive manner.
Second stock which i figured out to be among reeling under high-debt is Amtek Auto. It is a integrated component manufacturer for Automobile sector. Company has a big client base in india which includes names of Hero motocorp, Honda etc. Earlier, Company had defaulted on a payment of Rs.800 crore due to large no. of acquisition which impacted the overall cash flow of the company. Stock from its highs of Rs.150 two years back is now quoting around Rs.20. As per my knowledge, company is finding ways to emerge again from current situation.
The positive think i see in balance sheet of company is Book value which still stands around Rs.100. I think if company would come back in better situation in near future, we would possibly see some good buying in stock. Present suitation from which company is suffering seems to me a opportunity to bet on stock. Maybe, we could see some more share price depreciation. But i think there are also few chances of comeback of the company from ongoing situation soon.
I have not discussed few more debt-ridden companies here. Few of them on which i would share my views through my post soon includes names of Bhushan Steel, Lanco Infratech etc. And remember, stock market is not of one person, it works on different aspects.
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