Kotak Securities CEO – Kamlesh Rao has provided their top 5 recommendations that can be multibagger in next 2-3 years:
- NIIT Limited
- Engineers India Limited
- Mold-Tek Packaging
- Natco Pharma
- PNC Infra
The initiatives taken by the new management have led to consistent improvement in revenue growth and earlier-than-expected benefits on margins over the past six quarters. We remain optimistic about the future prospects of NIIT. NIIT has launched new programs in S&C business and added new clients in CLS, which should support future growth.
Engineers India Limited
Engineers India enjoys healthy market share in the Hydrocarbon consultancy segment. It enjoys prolific relationship with few of the major oil & gas companies like HPCL, BPCL, ONGC and IOC. Lower subsidies have led to enhanced capex plans by OMCs and major projects are coming up in next 6-12 months. We believe that in future, company shall inevitably benefit from MoPNG huge target of nearly Rs.1.2trn envisaged for various projects in XII five year plan.
Mold-Tek Packaging is a leading manufacturer of high quality rigid plastic packaging products (Rigid plastic packaging) and a pioneer is Inject Mold Labelling (IML) for lubricants, paints and FMCG industry. Mold-Tek Packaging stands to gains in the coming years from the increasing share of IML, backward integration and expansion in the food and FMCG industry. The stock trades at 12.5x FY18E earnings, and on EV/EBITDA, It trades at 7.5x FY18E.
Strong R&D capabilities and focus on creating a niche product portfolio sets Natco apart from its peers. For the coming years we expect both US and domestic formulations to further lead the growth and enable the company in posting 58% revenue CAGR and 87% PAT CAGR over FY15-18E. The stock we believe will continue to trade at higher multiples given the events lined up over the next 6-12 months.
PNC has track record of timely and before schedule completion of projects and received early completion bonus. It has robust current order book of Rs.62.2bn. This gives high revenue growth visibility for the next 2-3 years. It has consistently enjoyed margins of about 12-14%, which is good for road-construction Company. We expect its core ROCE to be about 25% in FYT17 and FY18.