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Founded in 2008, Bajaj Housing Finance (BHFL) is a leading non-banking financial company (NBFC) specialising in mortgage loans. Since its registration with the National Housing Bank (NHB) in 2015, BHFL has grown rapidly, becoming the second-largest housing finance company within seven years. In its Q2FY25 results, the company reported net sales of ₹2,410 crore and net profit of ₹546 crore while in its annual results (FY24), the company reported net sales of ₹7,617 crore and net profit of ₹1,731 crore. 

The company has a market capitalisation of over ₹1 lakh crore with Bajaj Finance Limited holding a stake of 88.75 per cent. The company displays strong fundamentals and the management anticipates future growth in disbursements within the retail sector, particularly in the affordable and near-prime segments. However, due to regulatory constraints, the management is limited in providing detailed forward-looking statements. Concerns exist regarding the company’s ability to sustain AUM growth given its current size and the potential for slower growth in the retail segment. The recent capital raise has led to a decrease in return on equity (ROE) to 13 per cent. Based on these factors, we recommend HOLD. 

Om Infra is a multifaceted infrastructure company with a wide range of businesses. It specialises in engineering solutions, particularly hydro-mechanical equipment like gates and hoists, and can even handle entire projects from start to finish (turnkey solutions). 

According to its Quarterly Results, net sales increased by 41 per cent to ₹238.43 crore and net profit decreased by 69 per cent to ₹3.93 crore in Q2FY25 compared to Q1FY25. In its annual results, the net sales increased by 39.4 per cent to ₹1,113.82 crore and net profit increased by 262.2 per cent to ₹47.10 crore in FY24 compared to FY23. In September 2024, DIIs bought shares and increased their stake to 3.92 per cent compared to June 2024. 

The company boasts a healthy order book of ₹2,138 crore, a positive indicator. Moreover, the improvement in return on capital employed (ROCE) suggests efficient utilisation of capital. However, its net profit declined in the current quarter due to an increase in taxes, which is likely a temporary factor. Despite this, we recommend a partial sale of the stock at this time while holding the rest. Hence, we recommend HOLD. 

Jai Corp, established in 1985, has a strong foundation in traditional manufacturing sectors like steel, plastic processing and spinning yarn. Recognising the evolving market landscape, the company is strategically diversifying its portfolio. This includes a significant focus on emerging growth areas such as infrastructure development and real estate, alongside its existing manufacturing operations. In its quarterly results, the net sales have shown an increase of 15 per cent to ₹135.4 crore while the net profit increased by 45 per cent to ₹17.2 crore in Q2FY25 over Q2FY24. 

In its half-yearly results, the net sales increased by 10 per cent to ₹256.3 crore and net profit increased by 74 per cent to ₹31 crore in H1FY25 over H1FY24. In FY24, the company reported net sales of ₹463 crore and net profit of ₹52 crore. Additionally, Jai Corp has received a notice from its associate company, Urban Infrastructure Holdings Private Limited (UIHPL), regarding a proposed capital reduction. UIHPL plans to reduce its share capital by 99.76 per cent and distribute the proceeds of approximately ₹3,746.87 crore to its shareholders, including Jai Corp Ltd. This decision follows UIHPL’s recent receipt of significant funds from its subsidiary, Dronagiri Infrastructure Private Limited, and other sources. 

Jai Corp expects to receive approximately ₹364 crore from this capital reduction, subject to necessary approvals. The company’s fundamentals appear weak, evidenced by unstable sales and profit growth. While the company boasts a debt-free balancesheet and healthy reserves, its current valuation seems inflated. We do not foresee any significant improvement in the company’s performance in the near future. We will reassess our position if future developments indicate a potential for growth that could positively impact the stock price. 

Hence, we recommend SELL 

Gokaldas Exports is a leading apparel manufacturer in India, specialising in the design, manufacturing and sale of a wide range of garments for men, women and children. Established in 1979, the company caters to the needs of several prominent international fashion brands and retailers, exporting its products to over 50 countries. Gokaldas Exports offers a diverse portfolio of apparel, including outerwear, activewear and fashion wear suitable for various weather conditions and seasons. 

The company is strategically positioned to capitalise on the growing demand for Indian-made apparel, particularly with brands diversifying their supply chains away from China. It is expanding its manufacturing capacity with a new unit in Madhya Pradesh and has planned for a second unit. 

The company delivered strong Q2FY25 results, with consolidated revenue growing by 85 per cent, driven by contributions from acquired entities. Excluding acquisitions, its revenue grew by 28 per cent and the export revenue surged 33 per cent, outperforming India’s export growth of 13.5 per cent. In its quarterly results of Q2FY25, the company reported net sales of ₹929 crore and net profit of ₹28 crore while in its half-yearly results of H1FY25, it reported net sales of ₹1,861 crore and net profit of ₹55 crore. 

One of the factors in the company’s favour is its focus on sustainability as the core of its operations and the most critical material determinant of its success. It has been at the forefront of driving impactful initiatives to create a positive wave of change. The company demonstrates stable financials and consistent profitability. We are cautiously optimistic about its medium-to-long-term prospects, driven by favourable business conditions in India and Africa. While achieving a 12 per cent margin and a 20 per cent return on capital employed (ROCE) may take time, we anticipate these improvements over the long term. Hence, we recommend HOLD. 

Aditya Birla Capital Limited is the financial services arm of the Aditya Birla Group, offering a comprehensive range of solutions across lending, insurance, asset management, and other services. This diversified portfolio caters to a wide spectrum of customer needs and preferences, encompassing various segments, channels and geographies. Key subsidiaries include Aditya Birla Finance, Aditya Birla Housing Finance, Aditya Birla Sun Life Insurance, Aditya Birla Sun Life AMC and Aditya Birla Health Insurance, among others, solidifying its position as a leading player in the Indian financial services market. 

Aditya Birla Capital reported strong financial performance in Q2FY25, with consolidated profit after tax (PAT) growing by 18 per cent YoY to Rs 834 crore. Total consolidated revenue surged by 34 per cent YoY to Rs 11,804 crore, driven by robust growth across key business segments. The NBFC portfolio expanded significantly, reaching Rs 1.15 trillion, while the HFC portfolio witnessed a remarkable 51 per cent YoY growth. 

The Asset Management business delivered strong growth in AUM, which reached approximately Rs 3.8 trillion, and SIP flows increased by 47 per cent YoY to Rs 1,425 crore in September. The Insurance businesses showcased impressive growth in both life and health insurance premiums. The company strengthened its digital capabilities through the launch of the D2C platform ABCD, acquiring 2.5 million customers to date, and the Udyog Plus platform for MSMEs, which has over 1.6 million registrations. 

While the company demonstrates strong growth in secured business loans and boasts industry-leading credit quality, its focus on maintaining asset quality while pursuing aggressive growth targets may present challenges in the future. 

Hence, we recommend SELL. 

Eimco Elecon (India) Ltd., established in 1974, is a leading player in the Indian mining equipment industry. Headquartered in Vallabh Vidyanagar, Gujarat, the company specializes in the design and manufacture of a wide range of equipment for both underground and opencast mining operations. Their product portfolio primarily comprises underground coal mining machinery, including Wheel Loaders, Dump trucks, Haulers, and Drill machines, which contribute significantly to the company's revenue. Eimco Elecon has a strong track record of innovation, having been the first company to introduce intermediate technology for mining equipment like Side Dump Loaders, Load Haul Dumpers, and Rocker Shovel Loaders in India. 

The company has a market cap of over ₹1,100 crore. According to standalone quarterly results, the net sales increased by 30.3 per cent to ₹66.63 crore and net profit increased by 10.7 per cent to ₹13.06 crore in Q2FY25 compared to Q2FY24. Looking at the standalone half-yearly results, the net sales increased by 43.7 per cent to ₹136.35 crore and net profit increased by 54.4 per cent to ₹27.84 crore in H1FY25 compared to H1FY24. In its FY24 consolidated results, the company reported net sales of ₹227.50 crore and net profit of ₹38.55 crore. Compared to September 2024, FIIs saw a stake increase of 0.29 per cent in December 2024, while DIIs experienced a 0.75 per cent rise in their holdings. 

Eimco's stock is worth considering due to its strong market position in the UG coal mining equipment segment, strong relationships with key players, and robust after-sales service network. Its focus on indigenous development aligns with the government's efforts to reduce import dependence. Eimco's operational turnaround, revenue exceeding `200 crore in FY24 and healthy financial risk profile, with nearly zero debt and significant liquidity, demonstrate its resilience and growth potential. If you are a high-risk investor, we recommend to HOLD this stock. 

Coal India functions under the Ministry of Coal, Government of India, and is headquartered in Kolkata, West Bengal. Incorporated in 1973 as Coal Mines Authority Limited following the nationalisation of the coal sector, Coal India is primarily involved in coal mining and production. The company also operates coal washeries. The power and steel sectors are the primary consumers of Coal India’s output, with other significant consumers being the cement, fertiliser and brick kiln industries. 

The president of India acting through the Ministry of Coal holds 63.13 per cent stake in the company. Coal India delivered steady performance during the second quarter and half-year ending September 30, 2024. The company’s consolidated net sales for Q2FY25 stood at ₹27,271.30 crore, reflecting a decline compared to ₹29,978.01 crore in Q2FY24. Similarly, profit before tax fell to ₹8,153.37 crore from ₹10,335.79 crore in the previous year’s quarter. Despite this dip, Coal India reported raw coal production of 152.06 million tonnes and off-take of 167.71 million tonnes, maintaining its leadership position in the coal mining sector. 

For the half-year period, its net sales were ₹60,441.43 crore, marginally lower than ₹63,050.65 crore a year ago, showcasing resilience amid challenging market conditions. The company’s ROI increased by 3 per cent YoY in FY24 to ₹1,42,329 crore, with 8 per cent volume growth. Its operating profitability improved by 171 bps to 33.71 per cent. In Q1FY25, the ROI increased to `36,465 crore, with a 39 per cent PBILDT margin. Capacity utilisation improved to 94 per cent in FY24. The company’s financial risk profile is strong, with a high net worth base and low debt levels. Its overall gearing remained below 0.20 times for five years. 

Hence, we recommend HOLD. 

Gateway Distripacks is an integrated intermodal logistics service provider with a nationwide network of nine inland container depots and container freight stations. Operating a fleet of 31 trainsets and over 500 trailers, it facilitates seamless transportation between its facilities and major ports. The company’s comprehensive service offerings include warehousing, rail and road transport, container handling and value-added services, catering to the diverse needs of the import and export industry. The company boasts a market capitalisation exceeding ₹4,000 crore and has consistently delivered strong profit growth, achieving an impressive 18.1 per cent CAGR over the past five years. 

While maintaining a healthy dividend payout of 37 per cent, the company has a low promoter holding (32.3 per cent) and a seemingly low tax rate, though it has exhibited a relatively low return on equity of 13.9 per cent over the last three years. In its Q2FY25 results, the company experienced a 2 per cent decline in net sales to ₹390 crore compared to the same period in the previous year (Q2FY24). This downturn was accompanied by a more significant 17 per cent drop in net profit, reaching ₹60 crore in Q2FY25. Examining the half-yearly results (H1FY25), the trend continued with a 3 per cent decrease in net sales to ₹743 crore compared to H1FY24. 

This trend was also exhibited with a 20 per cent decline in net profit to ₹108 crore compared to H1FY24. Looking back at its annual performance in FY24, the company reported a healthy net sales figure of ₹1,497 crore, translating to a net profit of ₹245 crore. While the company’s financials are showing improvement with increasing sales and profits on a quarterly basis, its stock valuation currently appears undervalued. However, negative cash flow remains a concern. Furthermore, the stock’s price action has not been promising in the short term. Hence, we recommend SELL 

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