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Wednesday, October 24, 2012

Camson Biotech: Technical Outlook and Fundamental Update!

We analyzed Camson Biotech about 6 months back and our fundamental analysis on Camson is available here. Camson is a gem of a scrip, and this indigenous biotech research firm has a rich portfolio of 22 biocides, 7 bio-fertilizer, and 17 hybrid seeds. Camson has a research infrastructure spread over 25 acres with modern labs and field testing facilities. Additionally firm has also developed a Proprietary Technology platform with microorganism database, screening technology and product compound library.

The results over last two quarters have been good with annual revenues now at 112.7 crores, which is about 13% growth over last year and EPS at Rs 12.49. Book Value is improved to Rs 69.27 per share and at current market price of 56.35, Camson is still available at decent discount to Book Price.

Technically speaking, on Camson chart 50 SMA has now crossed 200 SMA on EoD charts, hence scrip is technically out of a bear zone. However, there are persistent sell zones, where operators and share-owners have been selling persistently. Please see the chart below, where we have marked areas in range of Rs 60 to Rs 65, where there is solid resistance to Camson stock price.

Each time Camson stock has reached this range, volumes have surged heavily and stock price has backed down, which means only one thing. There are operators selling in this zone and pushing stock down from range of Rs 60 to 65.

We have marked volume surge, resistance zones and uptrend line support on this chart. There is strong indication that once this selling stops at level of 60-65, Camson would take off, and reach the next resistance zone of Rs 85, Rs 120 and Rs 140 respectively. Till then, traders need to beware of Rs 60 - Rs 65 zone and investors can continue buying on dips.

Thanks for reading this article and keep writing in to us.


  1. Nice pick man. Your stock picks are quite selective. I was thinking of German giant Bayer (Mallya's firm), Tata's Rallis, American company Monsanto and Dhanuka Agri few months back. I missed your article.

    I am little bearish on Camson's biocides. Biocides are great for health, but farmers opt quick solutions. They go for pesticides than natural (like Neem, Canabalic birds, etc...) biosides. Who will check the perspiratory residuals of pesticides? It is how our fate on public health. Even those banned pesticides are still in use across India. :(

    One thing to note about Camson, about 80% of their income is from seeds, only 20% is from biosides. I will wait for correction :).

    What is your view on Dhanuka Agritech? Results expected to be good. I know it is costly, @FV of Rs.2/-, the CMP is 125/-. Just curious to know your views.

  2. Thanks Venki.

    Camson is also a takeover candidate with its attractive valuations of Rs 101 crores. A MNC could easily offer 400-500 crores for Camson for its IP, Technology Database, Infra setup etc.
    Many of these Biotech firms realized value and scale only after acquisitions. Organic growth is also showing in improvement in Book Value.

    Dhanuka also seems a great stock. Will check in detail and revert.


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