Assignment – 1

By: Akshit Saraf (International Management Institute, Delhi) Date: 08/04/2020

National Stock Exchange

Zydus Wellness Limited

1. One of the 3 major manufactures of the drug Hydroxychloroquine which is being produced in large
quantities for local and export purposes.
2. A constant upward trend stock prices indicate healthy growth and stability in the longer run.
3. Rising Net cash flow and Cash from Operating Activities.
4. Last traded Price > 1st resistance level shows a positive breakout
5. To supplement all the points mentioned above, it can be observed that the current price of the share
is trading at a lower price compared to it’s true potential (52 weeks High).

IPCA Laboratories Limited

1. One of the 3 major manufactures of the drug Hydroxychloroquine which is being produced in large
quantities for local and export purposes.
2. High Piotroski Score i.e. the financials of the company are very strong.
3. Market sentiment has been very bullish in the past couple of months.
4. The company has very less dependence for Raw Material which makes it immune from domino effect
from it’ suppliers.
5. The company is almost debt free which is a very positive indicator as liabilities on a rainy day would
be easier to cater to.

Dr. Lal Path Labs Ltd.

1. One of the biggest and authorized private players in the market which is also ramping up its testing
infrastructure due to Corona indicates at higher revenues.
2. Company with Zero Promoter Pledge
3. Company with no debt
4. Growth in Quarterly Net Profit with increasing Profit Margin (YoY)
5. Strong cash generating ability from core business - Improving Cash Flow from operation for last 2
years

Thyrocare Technologies Limited

1. A private player in the market which is also ramping up its testing infrastructure due to Corona
indicates at higher revenues.
2. High dividends, with rising dividend yields over last five years
3. Company with Low Debt
4. Last traded Price > 1st resistance level shows a positive breakout
5. FII / FPI or Institutions increasing their shareholding
Biocon Limited

1. A private player in the market which is also ramping up its testing infrastructure due to Corona
indicates at higher revenues.
2. Relative Strength Index indicating price strength.
3. Near 52 Week High
4. FII / FPI or Institutions increasing their shareholding
5. Company has very low debt.

Bombay Stock Exchange

Divi’s Laboratories Ltd.

1. A private player in the market which is also ramping up its testing infrastructure due to Corona
indicates at higher revenues.
2. An increase in shareholder by foreign investors.
3. Increasing profits every quarter for the past 2 quarters
4. Relative Strength Index indicating price strength.
5. Strong Momentum: Price above short, medium- and long-term moving averages

Aarti industries

1. The management expects a substantial jump in FY21 in EBITDA with a new contract coming in
2. Paracetamol prices have experienced an increase of up to 40% due to the recent COVID-19 outbreak
3. Foreign Institutions increasing their shareholding
4. Promising Net cash flow from operating activities
5. Company is actively shedding its debt component.

ITC Ltd.

1. One of the biggest FMCG player in the market with an upward trend of sales in products such as
sanitizers, Hand Cleansing, House Hygiene and PPE.
2. Growth in Quarterly Net Profit with increasing Profit Margin (YoY)
3. Public sentiment has been positive for a very long time which shows stability
4. The company has zero promoter pledge
5. The Debt component is very low and hence an increased capacity to sustain market fluctuation

Hindustan Unilever

1. HUL, as a result of the positive impact of Coronavirus-linked on sales in its largest segment (skin
cleansing).
2. Synergies from GSK merger
3. Positive impact of crude price fall and price hikes for soaps are positive for the company.
4. Effectively using its capital to generate profit i.e. Return on Capital Employed improving in last 2 years
5. The company is very low on debt.
Sun Pharma
1. Sun Pharma, the largest Indian pharma company would benefit on account of its strong footing in
India and Rest of the World markets.
2. Even a marginal uptick in speciality revenues would support profitability.
3. Positive impact of Coronavirus-linked on sales
4. Companies with current TTM PE Ratio less than 3 average PE which indicates potential
5. RSI indicating price strength