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  • Engineers India - Is it worthy to hold this stock for short term or to exit at current levels.

    Confused about whether to hold stocks or dispose them? Searching for genuine advice here? Find advice from experts on this page and decide further course of action.

    Stock was a big under performer since the release of last quarter results.
    Myself and my colleagues are holding around 25000 shares around 78.
    We are really not sure why the stock keeps on falling. Can you suggest if this stock is worth a hold for short term?
  • Answers

    4 Answers found.
  • 1. Today the news is that they may declare a dividend. Wait for the declaration of dividend. As per the market analysis, an expert says the price may go down to 60 rupees. But there will be an increase after that and it may touch 80 rupees. He suggests that it is better to wait as of now and as soon as it touches 80 these shares can be sold off.
    2. The investment in this company is a long term. The company is a zero Debt company. It is a consulting firm and has a company construction project. The requirement of working capital is less and margins will be high. The price will go up. It is recommended to wait.
    3. The company's sales for the quarter ended 31-03-2020 is Rs 864.38 CroreIt is less by 3.87 % from last quarter Sales. But it is increased by 39.85 % when compared to last year the same quarter Sales. The profit Company has reported is Rs 128.98 Crore after-tax in latest quarter.
    4. After studying the market moment I suggest it is better to wait till this month-end and then review and make a decision.

    always confident

  • As you have invested in this particular stock, I assume that you know the basics about the share market and its behaviour in different situations. Still I would like to share some fundamentals before coming to this stock in particular. Whenever there is a natural calamity or political uncertainty or a depressive financial condition, the share market gets a beating and generally it is found that it starts a downward journey and stops at a considerable lower level and then waits for some positive triggers before it rises again and then it can even surpass the earlier high and reach new highs in times of financial prosperity. Many investors know about these things and play in the market accordingly. Though this is what generally happens but some stocks would defy the general trends and follow their own path depending on either going high based on the outstanding good results of the company or depending on adverse sales leading to its downfall. In addition to these criterion there are some general rules that do not sell in a falling market and wait for some time till situation becomes normal and shares start rising again. The same rule also applies in an abnormally rising market where one need not to buy but can offload the shares if he has got them. Shrewd investors do it patiently and reap the benefits also.

    Now coming to Engineers India ltd, which is a PSU company under the Govt of India umbrella and which is engaged in civil and construction projects in India and abroad. It is a company which is backed by the Govt so one should not have any doubt about its liquidation or things like that. If we see the 52 weeks high/low of this share which is 123/49 then the present price is near the low only which itself is an indication they the price is almost bottomed out. Another thing is it is giving a very good dividend and that itself is a big attraction to hold it. They had a net profit of Rs 430 crore during the financial year 2019-20. This is the time that many investors would be going to buy it rather than selling.

    Considering all these factors I would recommend to hold it for some good period till the stock rises above the level of Rs 85-90. From my experience of last 40-45 years in monitoring these things in the market, I can predict to a considerable degree of accuracy that in the post Covid scenario when the economic activity picks up this company share can go easily above the Rs 100 mark and may be more.

    Please note that the predictions and forecast in markets are based on the past experience and past performance of the companies. Any untoward situation like a calamity or war or change in political or administrative set up of country can affect the performance of any company whether in Govt sector or private sector and even the best estimations and prudent investment decisions can turn out as wrong.

    Knowledge is power.

  • Engineers India is a company owned by Government of India and is engaged in the constructional and other civil Enginnering projects. So far this company has been successful in delivering best results in terms of performance. This can be gauged through their financial profit earned in the financial year 2019 - 20 to the tune of Rs 430 crores.
    High and low prices during the past 52 weeks indicate Rs 123 and Rs 49 respectively.
    Hence the current price Rs 78/- should not depress you because it has the potential to surge above because of its strong fundamentals.
    If you go by the financial performance of this company there has not been erosion of its capital since its inception. Hence on that angle, the investment does not warrant any worrying. The following facts may please be understood while taking any decision relating to disposal of this share -
    1) This is the lean period in the sense that we are passing through a delicate phase in the wake of spread of corona resulting in detorioration in the construction of civil projects.
    2) Once this phase is over, the share price would move up touching to the level of Rs 100/- within next 12 months.
    3) Sales volume in the year 2019 - 20 was approximately higher by 40 percent as compared to last year.
    4) The engineers and other staffs are dedicated to their project - assignments and the results are expected to be encouraging once the present trend corona phase is over.

  • Investing in stock markets stock markets is always associated with good or bad market behavior and those who have invested huge need to have the tow of the market and decide. One of my relative has the good relation with a on line broker who would suggest him what to do with the shares of different companies and his advice and true genuine and he also arranges the sale of the share. What I feel that share market share holders should not go greedy and even with slight profit of investments made one should go ahead to sell the share as the future seems to be very volatile and nothing is sure. You being the investor knows the right time to sell or retain the share further.

    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

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