Expect a sharp correction in the Indian Market!!

Expensive Market
Markets are top heavy and with macro deteriorating there could be sharp correction in the share prices. Currently, Nifty is trading at 26.7x P/E (ttm) which historically has been close to tops

Worsening Macro:

Brent Crude has almost tripled from below $30 to now $80

Rupee has depreciated over 6% since start of the year, adding fuel to the fire






India 10-year G-Sec yield is now at an year high. 

And we are caught in a vicious circle

A Self-fulfilling prophecy:
$ Rising crude ---->  Worsening Fiscal  ---> Depreciating Currency  ---> Worsening Fiscal

$ Rising Crude + depreciating fx ----> Rising Inflation  --->  Rising Rates  --->   Lower Valuation Multiples 




Expensive Valuation + Worsening Macro is perfect recipe for disaster as it will eventually lead to deteriorating micro (read slower growth / margin pressure/ below expectations earnings)




What could be extent of damage?
The damage in the past has been as severe as 60%+ in 2008 when the world hit Global Financial Crisis or it could be as mild as 10% as seen in the recent past.

Whether the correction occurs immediately or over next few months is a difficult to answer but it seems eventuality! Rather let me say timing of the correction is uncertain but the correction is certain to occur. 

INVEST SAFE AND BE PREPARED!

Coming Tsunami aka Capital Flight

Coming Tsunami aka Capital Flight

Clock is ticking and all eyes are glued to 17^th September 2015 when the clock would strike 12.00. It’s time for Cinderella to return home. Will she or will she not? That’s a million dollar question. If she doesn’t then market will take a sigh of relief, of course only for few days as the clock for October 29^th meeting will starting ticker sooner than sigh of relief lasts. Yes! You got it right. We are talking about FED meeting and whether our own Cinderella, FED Chairwoman Ms. Janet Yellen would stop dancing and raise the interest rates. I don’t know whether its Sep/Oct/Dec that she would quit the party but whenever she does I know for sure it will lead to a Tsunami – a tsunami in global financial markets – most closer to US Debt market and Emerging Market currencies.

Oil at $40! And it means a lot Good to the world!

The last time I wrote the piece I had titled this paragraph, ‘Óil at $60! And what does it mean to the World and India’. Today as I write this article WTI crude is already at USD40 and Brent Crude Oil is USD46. I had mentioned then about the direct casualty being countries feeding on black gold and the risk of blowout at banks/funds with disproportionate exposure to Oil; but on a whole the improved strength of global financial system and economy will help us tide through these challenges. Thankfully, no major setbacks anywhere in the world have been felt so far. In fact, even Russian Ruble at is back to highs – as on 19^th Aug USD/RUB stands at 67 compared to high of 69.

So, what Oil at USD40 means to the world is - a resounding YES to slowing Chinese economy, a resounding YES to non-sustenance of cartel amongst gulf countries as individual interests take precedence to overall interest of the Group and last but not the least, a resounding Yes to reversal of Oil trade, which was driven on the back of Chinese dragon. So these have now become known fact but important thing to realize here is that Oil at USD60 didn’t mean disaster to the world nor would it be at USD40 per barrel.

Yes! There would be pressure on Oil/renewable Capex and construction boom in the middle-east but the world as a whole would move ahead without much of turmoil. However, till this process of Oil correction gets over, world-over corporate earnings would continue to suffer due to inventory losses and postponement of purchases in order to avoid high-cost inventory.

Last time I had mentioned that we don’t where would Oil settle but one thing is sure it won’t be $100 any time soon.  Similarly this time, we can safely call that bottom isn’t far away be it $35-40….certainly won’t keep falling to $20. What this means is the World is closer to the times, it actually start deriving real benefits of lower crude prices - in the form of stable lower prices to consumers, stronger demand and higher profits for Corporates and stable fiscal situation for Governments.    

So far so good!

But the real problem of deflation which I sighted then is just getting stronger. And Yes! Oil is acting just as the name suggests – adding fuel to this fire! 

Broader Deflation has intensified but wait…have you noticed the Core Inflation?

*Core Inflation excludes Food and Energy **as of Sep’14 (+Sep’14 was the latest data in the last piece – Looking through the Dust Storm)

Across the world inflation continues to fall at a rapid pace as is evident from the data in table above – in US inflation has slowed down to 0.1% from 0.3% in Sep’14. In Europe it’s down to 0.2%, China the level is flat at 1.6% while in Japan all efforts to drive inflation have gone waste with CPI down to 0.4%. So, the data fairly and squarely corroborates the general perception about the deflationary world. But something which has not been talked about and something which is critical for both common public and policymaker is core CPI. While broader indicator of inflation - CPI is down across the countries if we take out food and energy deflation then the core inflation i.e. core CPI has gone up almost across every part of the world. This makes the whole deflation/inflation problem very complex and interesting. How policymakers would react to this phenomenon would hold the key for ensuing Tsunami.

Why do Central Banks weigh Core Inflation more than any other indicator?

As we all know the single largest objective of Central Banks is to ensure ‘Price Stability’ in the system. We saw in the previous note that this price stability is quantified and defined by most of the Central Banks in the world as ‘two percent inflation’.

The next question to tackle is which inflation? Policy makers evaluate changes in inflation by monitoring several different price indexes. A price index measures changes in the price of a group of goods and services. In US Fed looks at Personal Consumption Expenditure (PCE) produced by Department of Commerce; consumer, hourly wage rates & producer price indexes issued by Department of Labor. In India, RBI looks at WPI and CPI and policies used to be governed by movement in WPI until recently when they shifted to CPI as their primary tool to assess inflation and based their monetary policy upon. Though such varied indexes and compositions thereof are looked at for understanding inflation and predicting its future direction, a Central Bank weighs high Core Inflation to determine its policy action, mainly because that’s what it can influence and that’s what it can predict with reasonable certainty and hence lends higher credibility to policy actions. Given the importance of core inflation Fed also has made it a part of Board Staff Economic Projection released with every FOMC meeting. Thus, combining the two views i.e. a) rising and closer to 2% core inflation b) Oil soon forming base for next year inflation, I believe FED would not be  worried about deflation hereon and we could see Fed raising the rates sooner than later.

No reason to not raise the Fed Fund rate…rather fear of loss of Confidence demands so!

As can be seen from the analysis presented in the table below, the deflation risk which was the Goalpost for US Fed is no more a concern today. With stable economy growth, tight labor market and hourly wage rate rising at 2%, the only cause of concern is appreciating USD which is hurting both corporate profitability and competitiveness of the country. But we believe there is not much Fed can do here. 

In world elusive for growth every country is trying to protect their turf with a more competitive currency i.e. devaluing their currency - the recent devaluation of Yuan by Chinese government for 3 straight days is a scary testimony of the same. The only currency which can stand on the other side is USD. If US also got into defending their turf then the downward spiral will have no bottom to reach. Again, with the reserve currency of the world that’s where all the money lies and flies. 

Fed perfectly understands this and hence we don’t think the USD will assume goalpost for the time being. 

Another thing which we sighted last time for continuation of low interest rate policy of Fed is the competing interest rates and that hasn’t changed. That means Fed should logically continue to hold on its zero interest rate policy.  

The danger of continuing with a very loose monetary policy, however, cannot be ignored. The cheap money is flowing entirely into high risk non-productive activities which could endanger financial stability, yielding socially undesirable effect of low returns for elderly people on their savings and completely undermining expected returns for Pension and Insurance funds. If these excesses grow to proportions which market believe unmanageable by Fed then we could stare at crisis of confidence leading to fall in USD and wealth destruction across the world. We won’t know when we would reach that point and better we stop earlier than reach that point. In my belief, Fed would therefore act sooner than later and raise the rates! 

Change in Fed interest rate policy will lead to Tsunami of capital outflows 

Fed has waited much longer than most of the market participants anticipated and this time hike could be smaller and slower than it has ever been in past. Last time in 2004-06, Fed took 24 months raising rates almost every month from 1% to 5% in 0.25%-0.5% quantum. However today the impact of 25bps could be much larger on much lower base plus global economic uncertainty and divergent central bank policies could be a deterrent.

Nonetheless, whenever it starts we know what to expect. There has been large asset shortages created in market thanks to QE.  Excluding QE the market depth has been poor and off-late liquidity has become extremely thin. This we believe is the perfect set up for ensuing Tsunami in US debt market as and when policy lift-off happens.

The other big casualty would be Emerging markets – both equities and currencies. This is vicious circle one feeding other and as capital flies back from these markets we could see a sharp fall in emerging markets currencies and equities. Stay away from these asset classes. However, the World will still stay flooded with money and after the initial turmoil across the markets this money will find its way back in stronger/higher yielding asset classes – read US Equities and EM debt. History suggests equity markets have delivered 10-15% returns in a year following US Fed started reversing interest rate cuts. So do use this correction to load you guns again but till that time keep your powder dry and prepare to survive Tsunmai.  

One last piece of advice: the way to survive Tsunami is not to build Noah’s Ark but just to stay away from places of Tsunami!

2015 Outlook - In a World Driven By Central Banks

Looking through the Dust Storm

Merry Christmas! Santa has come ringing bells for oil importing countries much before X-Mas with gift of almost 50% fall in crude oil prices.  However, the pace of fall in crude prices should ring alarm bells for 'stability' in the short term.  And yes, it did so for Bank of Russia! On 16th December - just four days after the scheduled policy meeting when Bank of Russia raised the policy rates by 100bps - the central bankers hurried for an early morning (1a.m.) emergency meeting and further raised the policy rate by a whopping 650bps to 17.25%. The event reminds us of Black Swan which, once rare, have started frequenting more often now-a-days. Alas! Whether it's a Black Swan, we will come to know only post-facto. One thing for sure, after much of a calm for the whole of 2014, the world has suddenly been covered under cloud of uncertainty and volatility. In this note we have attempted to see through this dust storm and find that, there is no immediate cliff but a short road ahead (my guess is the world will borrow 12-18 months) and that's it is!

Oil at $60! What does it mean to the World and India?

The decline in crude prices is a major boon for oil importing countries on many fronts - lower cost of living, improved consumer sentiments, easing inflation, lower cost of capital, stronger currency and last but not the least, lower current and fiscal deficit for these countries. Clearly, India is one of the biggest beneficiaries of the falling commodity prices. On the other hand, lower oil prices pose major challenges for oil exporting countries from Middle East, Russia and Venezuela the exact opposite would hold true - depreciating currencies, dwindling budget deficit, soaring inflation and higher cost of living. Collectively, these oil exporters account for less than 9% of world GDP (excluding Canada and Mexico as energy sector contribution is not significant to their GDP) and hence mathematically should not derail the world growth story. The cascading effect, however, could lead to some nasty outcomes.  The construction boom in Middle East and global Oil & Gas Capex would be the direct casualties while banks with heavy exposure to these sectors/regions could be the indirect casualties (SocGen's exposure to CIS stands at a staggering Eur24bn or ~60% of its equity). We believe that global economy and financial system is much stronger today and will successful tide over these challenges. The bigger problem is brewing elsewhere.

Welcome to the World of Deflation

	CPI Inflation	Core Inflation*		CPI Inflation	Core Inflation*
US	0.3%	0.1%	Europe	0.3%	0.7%
UK	1.0%	1.2%	- Germany	0.6%	1.1%
Japan	2.1%	2.2%	- France	0.3%	- 0.2%
Canada	2.4%	2.2%	- Italy	0.2%	0.5%
China	1.4%	1.3%	- Spain	- 0.4%	-0.3%
Australia**	2.3%	2.1%	- Sweden	- 0.3%	0.6%

*Core Inflation excludes Food and Energy **as of Sep’14

If we have to simplify the things, with Crude Oil & CRB index as guideposts, there is clearly enough evidence that the animal called inflation seems to be dead, at least for a foreseeable future. Whether the crude will settle at $55, $60 or $70, is anybody's guess. One thing is reasonably sure that it won’t be back to $100 any time soon. CRB index (global commodities’ indicator) is closer to 2008 lows in a world which has moved ahead 6 years. US 10-yr Treasury yields have declined by 30%+ in a year when Fed had wound up QE and experts are discussing timing of first rate hike. The current inflation in most of the countries which would drive global monetary policies is in the range of 1-2% (see Table above) and unless there is dramatic price rise across the asset classes, inflation will continue to slow down gradually to negative zone. And that’s a problem.

Why does Inflation matter?

Price Stability is one of the most important mandates for policy makers world over. Bank of England defines price stability as Government’s inflation target of 2%. European Central Bank states that the primary objective of ECB’s monetary policy is to maintain price stability and target inflation rates of below, but close to 2%. US Fed as well as BoJ also maintain same 2% inflation target. This struggle and desire to maintain a LOW and STABLE inflation environment is for the fact that manageable low inflation is critical for the steady growth of global economy. Inflations at manageable level is also critical for equity investors as it is a key source of corporate pricing power. The economy, as measured by GDP, is mainly composed of wages, indirect taxes and corporate earnings*. In general, wages are linked to inflation benchmarks while corporate earnings are driven by consumption demand.  Falling prices lead to both, lower wages and lower corporate profits and can push economy in a depressive spiral. A question one should ask is, if inflation is manifestation of growth (demand > supply) then isn’t a falling inflation concealing a slowing world ahead? It is! Inflation matters because lack of it can derail the global growth story. Worst, there are not many bankers out there or for that matter Corporates, who have much of prior experience or a clue as to how to respond to a deflationary environment. Deflationary impact on investment and debt are even crippling.

 (*Resource Cost Income Approach Equation:  GDP= wages + rents + corporate profits + interest + Indirect taxes + Depre + Net Income of Foreigners. As a thumb rule wages and corporate profits account for 80-85% of GDP)

In a low inflation and faltering growth will continue to keep interest rate low and fuel market rally

Managing (strong and stable) growth, inflation and currency are the key tasks of a Central Bank. Unfortunately, these are interlinked in such a way that not all of three can be achieved at the same time. Depending upon which one of these three is at a greater risk, goal post for a Central Banker keeps changing.  Given the complexity of equation, most of the market participants fail to keep up with the changing dynamics and therefore fail to see consistency in actions of policy makers. RBI Governor, back home, has refused to drop the interest rates despite inflation falling in the comfort zone. Apart from the fact that he wants more time to conform the fall in inflation is more permanent than temporary, I fear, the Governor, is worried about Fed action on interest rate,  in near term – any hint of or actual rate hike by Fed will send US Dollar in a sharp upward spiral and emerging market currencies could be the biggest casualties. Basically, his goal post could then shift from reigning Inflation to defending Rupee and if things go bad on that front, he won’t cut the rates.

Let’s look at the world of Central Bankers on these three parameters.

Country	GDP Growth	Inflation	Fx	Goalpost	Policy Action
US	Strong - Ahead of expectation, not a cause of worry for Fed	Dangerously poised to derail recovery in economy	Strengthening – not a cause of concern on its own but for inflation	Inflation – up it to targeted 2%	Continue with current low interest rates and don’t let USD appreciate much
European Union	Faltering – if not addressed urgently could lead economy back to recession	Way below target	Depreciating aga USD	Growth – Steer economy away from danger of deflation	Keep interest rates low Plus add stimulus
Japan	GDP decline in Q3 has put economy back in recession	Successfully  upped to 2%+	Depreciating sharply – architected by policy initiatives	Currency – Continue JPY devaluation to up growth & inflation	Continue with Abenomics – increased bond purchases and stimulus
China	Growth below target @ 7% and softening further	Not a problem	Appreciating against competing nations	Growth – Add stimulus and defend Fx competitiveness	Lower the interest rates to support growth and RMB

US is the only country which has stood out over the past 1 year in terms of any signs of sustainable improvement – GDP has bounced back to 3% plus and unemployment down to . However, in an increasingly interwoven world US rates will continue to be guided by competing interest rates, Europe in particular. The table above aptly bring out that lower interest rates would continue in the world and so the support to equity markets, in terms of both – higher valuations due to lower discounting factor (lower capital cost) and higher fund flows due to relative attractiveness compared to other asset classes.

Risks for the world economy going into 2015 will be lower than expected growth rate. If the same gets translated into lower earnings then it could be a dangerous as the onus could shift entirely on lower discounting rate and further stimulus by Central banks to support the market rally. It not only difficult but actually hazardous to peak into the future but still we would do it as a roadmap is necessary to guide through to the destination. If there be storms on the way better be prepared just to improve the chances for survival. That said, to conclude, expect growth to be lower, markets to get support for a while from lower rates/stimulus but then eventually fade away by late 2015 or early 2016. Hopefully India will survive this dust storm and will eventually realize its potential.

Back home, Indian economy still in a cyclical recovery phase & Modi holds the Key

Back home, Indian economy is still not out of woods and consumption continues to be weak. On the other hand, Investments from private sector won’t pick up till current capacity underutilization normalizes and infrastructure sector policy reforms are well addressed by the Government. So ball is now clearly in Prime Minister, Mr. Modi’s court. The good part, India is perhaps the biggest winner in the current oil turmoil. With inflation under control, the government along with RBI can now turn full attention to growth and reforms. Given the lack of majority in Rajya Sabha, timing of these reforms could be tricky and there could be delays but the direction of the change is clear. One aspect however seems to have gone unnoticed. Last week, we visited one of the nearby Government offices and were stunned to see the stark difference around the office premises – the usually dusty premises were neat and clean, dumped old furniture and old files had vanished; there was a certain sense of pride, purpose and professionalism in the air boosting the productivity. We believe, the behavioral change which Modi is driving is far difficult to achieve and has a far reaching consequences, the most important being improvement in productivity and reduction in wastage of valuable resources.

Near-term India equity market could be choppy

The recent equity correction is welcome as it keeps market out of valuation risk-zones and offers better buying opportunities for us. Still, at the current levels of 27400, BSE Sensex trades at 15.9x FY16, which is not cheap. Our recent interaction with management of portfolio companies and in general at investor conference leads us to believe that Consumption continued to slowdown post festival period and has impacted demand negatively across the category – credit growth to industry has slowed down to 7.8% in October 2014 compared to 15.9% last year; credit to services has slowed down to 8.9% compared to 21.7% last year. Though companies will benefit from falling inflation, we believe, there is a risk of negative surprise to Q3 earnings expectations.  

Longer term India now clearly differentiated and on the verge of a secular bull market

On 1^st October 2003, Dominic Wilson and Roopa Purushothaman at Goldman Sachs published their Global Economics paper, ‘Dreaming with BRICS: Path to 2050’. The report moved the global investment flows towards the potential of these four economies but with little differentiation amongst each of them. However over a period these markets have started getting differentiated as global investors’ learning curve and confidence matured over the last one and half decade. The same has been reflected in a more emphatic pricing of these markets.  During 2014, there is stark dispersion in performance* of BRIC markets - India is up 20%+ while Russia is down 48%; China is flat while Brazil is down 18%.  The wide dispersion suggests a clear segregation of individual markets and we believe this trend will continue to build upon.

Indian equity market undoubtedly has far richer mix of better managed and profitable companies – IT, Financials, Consumer Staples, Pharma and Auto companies with ROEs of (15%-30%) account for 2/3^rd of the market. The current weight of India in Emerging Markets Benchmarks is 6.5% compared to 20.4% for China and 14.5% for South Korea. Like the domestic equity participation (a meager 3-4% of savings), global investor allocation to India both direct as well as indirect through higher weight for India in benchmarks is also set to rise secularly. To sum up, with a strong leadership and political stability at the center, accelerated consumption from booming middle class and government effectively plugging in the missing pieces of puzzle – manufacturing and infrastructure – the foundation for multi-year bull market is well under formation. Stay put and add more!

 (*As of 19^th Dece 2014, MSCI Share price index in USD terms)

Arvind vs Raymond - a classic comparison

Over the last 6 months shares of Arvind Mills have almost doubled whereas the stock price of another textile leader Raymond has barely inched up by 30%.

Raymond is an iconic brand with dominant market share and an impregnable consumer franchise. Raymond also owns all its brands.

On the contrary, Arvind is more of B2B business. Its branded foray is essentially JVs or in-licensing arrangement with foreign brands. 

Intuitively, we all know that Raymond has a superior franchise, sticky channel and stronger distribution, its a focused and stable business model. But the share price over the last six month of the 2 stocks have just defied this logic.

The main reason behind such a strong move in Arvind's share price is essentially a clear communication by the company management about the growth and improved profitability. 

In various communications which are available on the company website the company targets to triple its topline to Rs.18000crs by FY18 which implies roughly 30% annual cagr.

At the same time, company also talks about the margin expansion and desire to improve RoCE to 20% plus.

Its but natural that such projections make the stock look quite cheap at current prices and hence the heady run up in the stock.

However this reminds me of a very interesting thought put forth by a leading value investor. He said, "P&L investing often goes wrong as the business environment is so volatile today; projections turn out to be way below expectations. However, instead of earnings we focus on balance sheet buying 30 cents in a dollar at bottom of the cycle; asset values don't change as drastically and often increase with inflation." 

Taking a clue from this legend, I though lets evaluate the two businesses as these are today. The analysis lends necessary support to the intuitive disconnect that Raymond despite being a stronger and consumer facing franchise is not so recognized by the market. 

The analysis throws that Raymond is not only deeply undervalued relative to Arvind but its a revelation for value investors eyes as the core business is essentially available free. And given the Raymond management has gone on record with its intent to unlock the value in immovable property its a matter of time that the stock will have a 'catalyst' in place.

Arvind shareholders will definitely make money if management does achieve what its targeting, but the journey is one up hill and a mammoth task. For investors margin of safety is very low.

Raymond on the other hand is subject to same set of macro environment with each of its textile businesses as Arvind is - its branded textile fabric, B2B denim and branded apparel business franchise are superior to Arvind growing at similar pace. But the stock offers great margin of safety as the core business is available essentially free when one builds in value of hidden assets which offers very high margin of safety to investors.  

No points guessing which stock one should load up.

Buy SBBJ

State Bank of Bikaner and Jaipur or SBBJ as most commonly known is the market leader in the state of Rajasthan. The bank has a phenomenal grip on the home turf with ~35-36% deposit share and 25-30% advances market share. 

New leadership to drive profitable growth

SBBJ has a new stewardship under Mr. B Sriram who joined as Managing Director in February 2013. Mr Sriram comes from SBI where he was Delhi Circle Chief General Manager looking after  the states of Rajasthan, Uttarakand, Delhi and with a large presence in Western UP and parts of Harayana. Our interaction with Mr Sriram reveals that he is a very level headed banker and possesses strong leadership qualities to prosper this bank ahead. Given his sharp understanding of the products and strong focus on asset quality we believe there is right management in place.

Strong platform for high double digit growth 

The state of Rajasthan offers tremendous growth opportunities for the bank. During 2012 it was one of the fastest growing state with over 20% GDP growth which has slowed sharply during FY13 as entire economy has slowed down to low single digit growth. Nonetheless the future holds strong promise. Average per capita deposits as well as average per capita credit is half of the national averages and way below even neighboring states.

This means that Rajasthan will continue to have above average deposit growth rate for next decade compared to other states of India. On credit side, its a difficult call, nonetheless, it is safe to assume that at least consumer credit growth will be higher than the rest of the country due to lower penetration combined with expectations of higher per capital income growth. A pro-business state government is certain positive factor for credit growth. But unlike deposit SBBJ would not be heavily relying on Rajasthan for credit growth. A large part of the advances growth comes on the back of parent SBI, which offers an opportunity to its associate to participate in consortium. SBBJ has the freedom to choose the business and it independently studies every proposal before deciding to participate. The lower level of NPAs - 3.6% compared to 6% for SBI - clearly indicates that the bank has been much more prudent in credit assessment and is not blindly participating consortium. On the positive side, the option to participate in consortium allows to optimise the business acquisition cost for the bank.

In Rajasthan all its nearly a banker to the Government - maintains all salary accounts of government employees as well as enjoys income from all the government transactions. It is also very strong in cross selling of insurance and mutual fund products of the parent to its customers which is further adding to fee income. Overall however there is a lot to be done on fee side but management appears to be clueless about how to build this part of the business.

Asset quality has been a cause of concern with Gross NPAs at 3.62% and Net NPAs at 1.9%. It also has a large restructured book of Rs.4300crs i.e. almost 6% of loan book. On the good part, slippages from the restructured books are restricted to ~10% and most of that book continues to be current. 

Bank maintains adequate capital with Tier I at 9.1% and total at 12.2%....good enough for 20% growth in balance sheet. RoAs are respectable at 0.96% and RoEs are also respectable at 15%. 

At current market cap of Rs.3056crs (CMP - Rs.436) the stock trades at 0.8x FY14 and 0.7x FY15 book of Rs.4084crs and Rs.4820crs respectively. On p/e terms the stock looks even cheaper at 4x FY13 profits of Rs.730crs

Dividend yield at current prices is very good at 3.7%

The merger with SBI could accelerate the gains as indepedent valuation would most probably lead to swap ratio at 8x earnings or 1.2-1.5x book (SBI trades at 1.8-2x) which means you would double money. There is hardly any downside from the current levels.

Strong BUY !!!