Stock Shastra

ITC Ltd. is the largest tobacco company in India with close to 80% market share (value) in cigarettes. The inelastic nature of demand for cigarettes coupled with government regulation has enabled ITC to become a virtual monopoly and given it a moat (a strong competitive advantage). This has reflected in its financials which have been consistently high and made it one of the top performers in the FMCG sector.

The company has also diversified into other FMCG categories and businesses like Hotels and Paper and Agribusiness which could be the growth drivers in the future. However, many of these businesses are yet to turn profitable amidst intense competition in respective categories.

Considering this, should you invest in ITC Ltd.?

ABG Shipyard is the largest private sector shipbuilder in India and is also engaged in ship repairing. It was recently awarded the industrial license for design and construction of Indian Defence ships from the Ministry of Commerce and Industry. With this license in hand, ABG is looking all set to tap the opportunity for building ships for Indian Defence.

The financials of ABG Shipyard have been consistent over the ten year period. However, the debt of the company, which has been on a higher side, has reduced its profitability.

Considering this, should one invest in ABG Shipyard?

NTPC Limited is India’s largest state-owned power generation company. It contributes approximately 29% of the country’s annual power generation and has almost 1/5th of India’s total installed capacity. It has maintained an excellent track record in terms of efficiency.

But, the company’s financial performance over the last 10 years has not been very impressive. Though it managed to grow its Sales at a good rate over the years, the same growth has not reflected in its earnings. In the last financial year, especially, the profits took a major hit due to high fuel costs. However, in future the company seems poised for a good growth.

So, considering all these points, should you invest in this Maharatna power company?

Hindalco Industries Ltd., a Aditya Birla group company, is the largest aluminum producer in India and one of the world’s largest aluminium rolling companies. It also produces copper and its copper smelting capacity is also the largest in Asia.
The company has had a mixed performance in the last 10 years with its Earnings Per Share registering only a marginal growth over a 10 year period. On a positive note, the company has major expansion plans for the next few years. Also, recently, its subsidiary, Novelis witnessed a turnaround in its performance.

Axis Bank, formerly UTI Bank, is India’s third largest private-sector bank. It has a large customer base of over 1.5 Crores which it services through its wide network of more than 1281 branches including 169 Service Branches and over 5303 ATMs.
Over the last 10 year period, Axis Bank has performed robustly in all its financials. It recently acquired Enam’s investment banking business which would enhance its portfolio. Yet, certain sectoral concerns remain Since the last one and a half years RBI has increased the Repo rate, Reverse repo rate, and CRR in phases in order to curb inflation.
But, in the last one and a half years, the What do these recent developments mean for the Bank in the short-term and long-term?
a) In the light of this, will Axis Bank grow from strength to strength?
b) At its current price, what is the investment decision you must make?