I will avoid it. I use fundamentals to buy a share and technical analysis to put my order. But it doesn’t sound fundamental to me till the 3rd Quarter earnings news this year.
The market was in uptrend for last 2 years and the stock has been declining. In Jul’15 I was analysis stocks for Value Investing based on GST impacts.
If the GST, when implemented will obviously reflect in the sales of the Gail at a large scale which will cause a sudden surge! Not only Gail, it will impact Gail but also all other transport companies. Strong point is Gail also provides dividend of around >30%.
But Why I didn’t bought Gail –
In Jul’15, Promoter shares pledged as much as 56% to take a huge loan which didn’t impacted much in the interest section of their balance sheet but I didn’t like that fact.
Now, Promoters have pledged 82.51% of their holding. No!
Actually I will like to say, avoid all logistics companies – specially Bluedart, Snowman and Sical Logistics Ltd. Sical makes sudden quarterly profits which is inconsistent. I do not know what Sical’s other income is but it reflected that it has more “other income” than its “Operating Profit” itself.
But if you really want to buy a logistics stock – I will pick All Cargo Logistics. I think the most benefited company for GST amongst this peer will be All Cargo Logistics. What is your opinion?
Also I am expecting a good quarterly results from All Cargo for this September whereas I am expecting a bad quarter from Gati.
So if you still want to buy Gati, wait for this week till it’s STOCH (14) value goes beyond 20. There is a strong resistance which will boost to a short-term guaranteed uptrend.