SP Tulsian, sptulsian.com is bullish on Asian Oilfield Services, Dunlop India and Balaji Amines.

Below is a verbatim transcript of his exclusive interview with CNBC-TV18's Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying videos.

Q: What is the story that you like in Asian Oilfields Services?

A: This company is basically into providing seismic services to oilfields and oil exploration activity. Recently, they have moved into to the core mining activities also where the services are provided to the coal and iron ore mining sector and both the sectors have now started doing quite well.

If I focus only on FY11 because FY10 was a flat performance, in FY11, they had good Q1 results, but Q2 was very bad because of lack of orders. In spite of having the total infrastructure in place in respect to equipments and all the man power, they have been involved in three projects in the North-East Region and there they have not been doing so well. But now they have recently got orders of about Rs 80 crore. Of those three assignments, two are in North East region and those they will be completing very soon and will be moving on to this Rs 80 crore orders.

I am expecting that from FY12 onwards the company should be able to post the reasonable performance, which they have been posting a couple of years back, with top-line of close to Rs 75-80 crore and bottom-line of maybe close to Rs 8-9 crore which can translate into an earnings per share (EPS) of Rs 5 per share.

Going by the financials of the company, the promoters of the company last year have subscribed the equity at about 40 lakh shares at Rs 61 per share. So, the present networth of the company is close to about Rs 100 crore on an equity of Rs 15 crore, so that translates into a book value of Rs 61-62, while the share price is quite low. The entire amount has been used for purchase of the fixed assets for creating the infrastructure of the company.

So, once you have this place and the potential of both the sectors going ahead, I think the company is likely to perform quite well. Maybe because of this non performance in the last 6-12 months, the share price has been languishing at such low levels. I am quite positive on the stock with a view of about six-eight months time. If somebody can have that kind of time horizon, he can look for a 50% return from these levels.

Q: The other pick you have is Dunlop. What is the story there?

A: There is an interesting story in Dunlop. The Ruias, who are already running the Falcon Tyres, have acquired this company a year back. We all know that the company has been lying closed for quite some time, maybe for the last eight-ten years. So, it was a Herculean task. But the company is bagged by rich assets, manufacturing plant good land value, good brand recall etc. So, recently, maybe in the last one year, the promoters have infused about Rs 250 crore into the company as an inter-corporate loan which can be termed as quasi equity and the company can be called debt free.

Even if I take this as a debt, the networth of the company presently is Rs 125 crore. They have two plants one at Sahaganj in West Bengal and Ambattur in Tamil Nadu. In Ambattur, it's a very prime land and they have huge surplus land lying there. The promoters as a company plan to sell part of land or monetise part of the land at Tamil Nadu. They are expecting to realise about Rs 700-750 crore by either developing that property of their own or selling it off. But I am going more by the core business of the company and Falcon Tyres, which the promoters have acquired six-eight years back, they have really turned around, they have a good presence and the manufacturing capacity of the company is also quite good at 32 lakh tyres per annum.

This is the only company which has been making the Aero Tyres. Going by their financial performance, though they have a very low turnover at present of about Rs 175 crore and they are not utilising the capacity even to the extent of 10%. I think that maybe in next 12-18 months they should be able to take their plant capacity to about 60-70% utilisation, they should be able to monetise about Rs 300-400 crore or maybe Rs 500 crore in this period.

So, taking all this into consideration, at least in this market I see very limited downside for the stock, maybe it cannot fall more than below Rs 65. But once you have the recovery in the market and once the market stabilizes, share can bounce back to about Rs 85-90 levels in the short-term. If one can have view of about six-eight months, it can be expected to go upto Rs 100.

Q: What about Balaji Amines, what is the story there?

A: This is a consistent profit making company. They are making their amines and its compounds. They have three plants; one at Sholapur, one at Osmanabad and one in Medak in Andhra Pradesh with total capacity of 55,000 tonne. These amines have good demand in pharmaceutical API industry, refinery, paint industry and the company has been a consistent performer. Recently, company has sub divided their face value of share from Rs 10 to Rs 2. Going by the financials of FY10, it had a top-line of Rs 260 crore with profit after tax (PAT) of about Rs 21 crore and EPS of Rs 6.50 on Rs 2 face value.

And going by H1 performance of FY11, they have clocked a turnover of close to about Rs 180 crore with EPS of about Rs 5, with bottom-line of close to Rs 17-17.50 crore. That means they have already achieved 75% bottom-line what they have earned in FY10. If you extrapolate the same, they are sure to post an EPS in double digit maybe about Rs 10.50-11 for FY11. Going forward, for FY12, it should be about close to Rs 15.

So, if you go by the consistent performer for last over four-five years and share ruling at a PE multiple of less than Rs 4, if I go by FY11 performance and if I go on forward, it is ruling at a PE multiple of 3. So, I don't think this kind of valuation is really deserving for this chemical company. Though by and large the chemical companies are enjoying lower PE multiple, but they can be treated more into the specialty chemical space where the PE multiple are always higher, in range of about six-eight times. So, I am quite positive on the stock which can also give a price of about Rs 60 may be in six-eight months time.

Q: What is bothering sugar, Bajaj Hindusthan, Shree Renuka Sugars down 14% in the last three days?

A: I think this is more to do with the cancellation or withdrawal of the 5 lakh tonne exports which had been approved by the Food Minister on the hopes that they will be seeing good production of sugar, which I agree. I maintain my view of maybe 26 million tonne of production of sugar in this season, while the government has been saying 24.5-25 million tonne. So, this has more to do with the sentiments.

But as far as the UP sugar mills are concerned, which I always have been maintaining that there was no reason for all those stocks to go up be it Bajaj Hindusthan or Balrampur Chini, but they were largely going up because of their presence more in the F&O space. But maybe the non F&O stocks having UP presence were seeing little value maybe Simbhaoli Sugar or Dhampur Sugar.

Q: What would you do with Hindalco, that stock has got brutalized over the last couple of days, down about 12-13%?

A: Long-term or the fundamental call is intact because of the performance of the Novalis expected going ahead. But, yes, there has been huge short-term built up or maybe the long positions having got created in F&O segment. With a fall in the market, you see that kind of correction coming in. But I think maybe it should not fall below Rs 215-220 where the renewed buying interest purely on fundamentals should come back. So, whatever worse has to happen, has happened in the stock.