Stock picks.

Stamford Tyres.

See financials.

The company was hurt badly in the last 6 months at it faced strong price pressures due to high rubber prices which have since decreased. From a peak of 2.40USD/kg in june/july/august 06, the prices showed a temporary dip in december 06 to 1.50USD/kg - this downward trend has not continued - since then the price of raw latex has climbed to 1.9USD/kg. However, i believe that this is a temporary elevation in latex prices. In anycase, as this is an industry wide problem, i believe that the company will soon be able to pass on the expenses to the consumers should the latex prices continue to rise.

Taking a look at the last financial statement (1/2 year closure) shows a company in consolidation for expansion into new markets which is in line with their roadmap 07/08.

they have lost gross margins YOY 3% and net profits YOY 13%. However, in light of the rubber price peak and the inital high startup cost of creating new distribution networks in new markets (US and Europe) as well as their diversification in product portfolios, these reductions in earnings are within expectation.

On the marketfront, I believe the negative market sentiment has stabilised - signs of recovery are in place.