Top Stock to Buy with Anil Singhvi – Max India: The Budget 2021 presentation is just a few weeks away and there is one stock which will be in action till that time. Zee Business Managing Editor Anil Singhvi said that it has reasonable valuations and is not only important from the Budget 2021 standpoint but is also a good stock for long term investment perspective. This stock is Max India. Research Analyst Ashish Chaturvedi has a detailed report.
Chaturvedi said that this company has recently been relisted at an attractive valuation of Rs 80 per share on 28 August 2020 and the subsidiaries of this company hold a lot of value. It is the holding company of Max Group. The company has two unique business models which are likely to pay rich dividends for the company, going forward, he said.
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The income contribution and cash flows are expected to improve from here. Max India has business interests in healthcare, real estate and education sector.
The real estate projects are located in Dehradun, Noida and Delhi, he said. Max India has a regular source of rental income.
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Max India caters to the senior citizens and has aggressive plans towards this segment. Max India will be investing Rs 300 cr in this vertical which will lead to a further growth, Chaturvedi said. This segment has been EBIDTA positive over the last three years and has given healthy margins of 15 per cent. Certain reports suggest that the company income could go above Rs 500 cr from this segment.
Unique Business Model
One of Max India subsidiaries ‘Skill First’ is into skill development and in education space where there are many growth avenues. The balance sheet of the company is also quite strong with Rs 400 cr of free cash. All these things suggest that Max India stock has the potential to give good returns.
Anil Singhvi’s View on Max India
The Market Guru said that this was the first stock in the Budget 2021 series and there was no doubt about its growth prospects. He said that it was a cash rich company with tremendous outlook. The valuations are at comfortable levels and it augurs well for investors if this stock give 40-50 per cent returns on an annual basis.
At 10 am, Max India share price was trading at Rs 64.50, on NSE, up by almost 4 per cent.