GHCL: Market Leader in Industrial Products, Textiles and a Dividend Gem!

GHCL - Gujarat Heavy Chemicals Ltd - is from a category of stocks which makes me wonder that how many undervalued gems are lying around undiscovered in Indian Markets. GHCL is a crown jewel from the erstwhile Dalmia empire, which had its businesses in myriad of spheres such as Newspapers and Publishing Houses, Biscuits, Cement, Chemicals, Distilleries, Dairy Products, Sugar, Textiles and many others.

GHCL operates in two key business verticals which are Industrial Products - Soda Ash and Textiles.

Did you make any money from StockFundoo?

Did you make any money from StockFundoo Analysis?

At StockFundoo, we have analyzed about 17 stocks in past 6 months. Most of these stocks were undervalued gems, paying as high as 5% dividend from past many years. In the past 1.5 year Bear run on emerging markets, especially India,  Midcaps and Smallcaps were badly beaten up. So at StockFundoo, we analyzed several of these stock stories and presented their internal strength to you.

Lets see how our recommendations have done, and whether you have made any money in past 6 months:

Nifty: Key Level Breakout today and heading towards 5950!

With a marathon 2.5% rally in Indices today, Nifty broke a important resistance level 5630 comfortably and is heading towards the next resistance zone of 5950. Nifty's Mojo is definitely back, as liquidity is back in global system and India government is sending all right signals. Please see the chart below which shows key resistance levels for Nifty on a Daily chart. Current resistance level of 5630 is comfortably broken today and this breakout has also broken the upward price channel.

India is Back on Growth Path! And which Midcap & Smallcap stocks can benefit from Reforms!

Congratulations! India is back on Reform path in a flurry of announcements - both domestic and global - in last two days. We at StockFundoo however pointed the bullish Golden Cross on Nifty five week back on August 8. Read that report here. Golden Cross is a reliable technical indicator which seldom fails. Please remember charts always move much earlier than the news items!

So FDI has opened up in Retail and Aviation, as well as Broadcast and Power Exchanges. Disinvestment in PSU is on its way. Rate cycle will most probably turn around this Monday and gradual rate cuts will happen throughout the next one year. Which all Stocks - Midcaps and Smallcaps stand to benefit out of this excitement. Lets look at charts and figure out!!

Nifty has broken out on charts, but what is happening on Midcaps. They are still lagging, hence the next flood of capital will enter the Midcap space, please see the two charts for comparison:

Pls see the Nifty chart below for Support and Resistance levels on EoD charts. Nifty has nearly reached the resistance zone of 5575-5600, where most of prior bear rallies in 2011 had failed. Pls see the history of this important level in much of later part of 2010. This zone gave a tremendous resistance in all of 2010 and once crossed, 5600 to 6300 happened in less than one month. All call option sellers, selling in September at this level were taken to cleaners and lot of high level resignations happened at PMS firms due to PMS traders losing a lot of client money selling call options, when 600 point rally suddenly happened after breaching 5600! Be afraid, be very afraid of this level!

Ramky Infrastructure - Giant of a Infra firm!

I have a close friend who is in love with Ramky. Ramky Infrastructure's stock, that is. After a few luncheons where I overheard  the goodness of Ramky in detail, I decided to explore it myself. I am happy to disclose that Ramky Infra finds a good place in my portfolio as well now.

Ramky is a giant of a Infra firm, and has built Roads, Residential buildings, Dams, Barrages, Water Treatment plants, Sewage plants, SEZs, bridges, flyovers and Power transmission projects. With the Infra starved country that India is, Infra specialists firms have a good future ahead. All they can build, India can absorb, and will demand for more, atleast for the next decade or so. Also, Infra sector is out of favor currently, but with Interest Rate cycle reversing its path, monetary loosening on the anvil, capital hungry firms such as Infra will be back in favor.