IFGL Refactories can rally 40-50% in a year, but liquidity a concern: Prakash Diwan

In a chat with ET Now, Prakash Diwan, Director – Altamount Capital Management, shares his wealth creating ideas.

ET Now: There is always a market for a terrific idea. Is there anything that you have unearths of late?

Prakash Diwan: There is a stock CMI FPE that I recommended earlier. That stock has jumped significantly of late.

ET Now: Are you talking about CMI FPE, the one which is priced at around Rs 482?

Prakash Diwan: Yes.The steel industry which has significantly got a huge component of convertors, the manufacturers who take raw steel, CR and HR steel and convert them into different application like pipes and other products, will benefit from the capex cycle revival. From that perspective, in the continuous casting, there is something called refractories. They are connectors between two different moulds where the molten metal flows and these refractories are very specialised kind of material.

So there is a called IFGL Refactories . It is a good old company, which has been leader in that segment. But it does not get talked about much now a day.

That said, but I see that capex cycle benefiting some of these companies. IFGL is available at a fairly decent price at sub-Rs 110 level right now.

The only thing is that it is little bit illiquid. But companies like this, will start benefiting from this capex cycle. People could start looking and buying into these counters. There is not much of a competition or race for acquiring some of these companies. So, one can take time, nibble into it and built it into a portfolio for a decent upside of at least 40-50 per cent in the next one year.