Sokhi Pick of the WEEK : Amarjothi Spinning Mills Ltd CMP 58

Amarjothi Spinning Mills Ltd. (ASML) is one of the largest producers of yarn in India. Established in 1987, it is a listed company owned by the Amarjothi Group of Companies.

For Q2FY10, it recorded net sales of Rs.20.43 cr. with net profit of Rs.1.59 cr. against net sales of Rs.26.47 cr. with net profit of Rs.1.53 cr. in Q2FY09. For full FY09, it recorded net profit of Rs.3.37 cr. but for H1FY10, it has recorded net profit of Rs.3.06 cr. Its Q2FY10 EPS was Rs.2.35 and H1FY10 EPS was Rs.4.52. It paid 15% dividend for FY09. At current level, the stock is available at a forward P/E ratio of just 6.

Investors can buy this stock with stop loss of Rs.52. On the upper side, the stock will zoom to Rs.68-71 level in the short-to-medium-term.