Recommendations from Diversified and Software sectors

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations.

SRF LIMITED

CMP - ₹2,616.90
BSE CODE 503806
Volume 12,578
Face Value ₹10
Target ₹2880 - 2940
Stoploss ₹2,460(CLS)

S RF Limited is a chemical-based multi-business entity engaged in the manufacturing of industrial and specialty intermediates. The company’s diversified business portfolio covers fluorochemicals, specialty chemicals, packaging films, technical textiles and coated and laminated fabrics. The company has witnessed a robust jump of 44.28 per cent in its net sales and operating income from ₹2,699.40 crore in Q1FY22 to ₹3,894.72 crore in Q1FY23. The operating profit also soared from ₹270.36 crore in Q1FY22 to ₹685.33 crore in Q1FY23. The quarter saw net profit of ₹608 crore as compared to ₹395.28 crore in Q1FY22, clocking 53.2 per cent gains. Along with reporting robust numbers for Q1FY23, the company is focusing on capital expansion for speciality chemicals owing to higher consumption of fluoro compounds across the agrochemical and pharmaceutical sectors. This will lead tomore clear revenue visibility and it is expected to strongly underpin the company’s future performance. Hence, we recommend BUY.

CMS Info Systems Ltd

CMP - ₹334.05
BSE CODE 543441
Volume 3,26,009
Face Value ₹10
Target ₹360 - 374
Stoploss ₹310 (CLS)

CMS Info Systems Limited is India’s largest cash management company engaged in installing, maintaining and managing assets and technology solutions for banks, financial institutions, and organised retail and e-commerce companies in India. On a quarterly basis, the consolidated numbers of the company report net sales and operating income to be ₹471.67 crore in Q2FY23, a 26.77 per cent rise from ₹372.08 crore reported in Q2FY22. The operating profit of Q2FY23 of ₹137.06 crore grew 42.36 per cent from ₹96.28 crore in Q2FY22. The company reported net profit of ₹72.52 crore in Q2FY23 compared to net profit of ₹52.79 crore reported in Q2FY22. The company has posted sturdy Quarterly Results which include positive cash flow from operating activities. It has delivered decent operating profit growth for consecutive quarters in the past led by market leadership, expansion of technology-enabled services, orders from large enterprises and better execution. Hence, we recommend BUY.

(Closing price as of Nov., 01, 2022)