Stocks to buy with Anil Singhvi: Uflex, CESC, ITC are top picks for Vikas Sethi

Zee Business Managing Editor Anil Singhvi, in the latest episode of ‘Sadabahaar Sethi Saab’ show, talked to market analyst Vikas Sethi and asked him to reveal his top picks that can generate good returns for investors. Sethi gave three calls on Tuesday, two from the cash market and one form F&O space.

1st Pick: Uflex (Cash Pick)

Straightaway giving his first pick from the cash market, Vikas Sethi said UFlex is India's largest flexible packaging company and an emerging global player. UFlex enjoys a global reach with unhindered speed making it truly multinational. Headquartered in Noida (National Capital Region, New Delhi) it has state-of-the-art manufacturing facilities in India, UAE, Mexico, Poland, Egypt and USA. Ulfex is the world’s largest supplier of polyester films for flexible packaging applications.

Fundamentals of the company are extremely strong and valuations are extremely attractive at current levels. Price earning multiple is 4.5, market cap of the company is Rs 2700 cr while the sales for last year accounted to Rs 7400 cr. Market cap to sales ratio is 0.4 while price to book is 0.5. Q2 profit for FY21 stood at 222 cr vs 94 cr (YoY). The cash flow of the company is positive and Ulfex can touch levels of Rs 400 – Rs 410 in short term with stop loss of Rs 375.

2nd Pick: CESC (Cash Pick)

Sethi’s second pick from the cash market is CESC, this is a RP – Sanjiv Goenka Group company. Valuations of the company are extremely attractive when compared to its peers. Price earning multiple is 6.79 and is extremely cheap when compared to Tata Power. Last year CESC gave a dividend of Rs 20, which implies that the dividend yield is close to 3% - 3.5% while price to book ratio is to 0.89. Q2 FY21 results have been extremely strong.

Fundamentals of the company are extremely strong, operating profit margin of the company is 21%, Return on Equity is 14%, 3 years CAGR is 26%, Q3 FY21 results of the company are expected to be strong today and can see targets of Rs 700 today itself with stop loss of Rs 640.

3rd Pick: ITC (F&O Space)

In Futures and Options, Sethi said ITC should be bought at current levels of Rs 206. ITC stock can see targets of Rs 220 in short term with stop loss of Rs 199. FMCG companies HUL, Nestle, Dabur, Britannia, Godrej Consumer products and others are seeing strong traction; ITC could soon participate in the rally.