Tuesday, December 30, 2008

Nifty Levels - 30 Dec 2008

In morning whole of Asia was also trading in green so Nifty followed its asian counterparts in making merry. Nifty today shown a good upmove of around 2% and closed at 2980. Satyam, Idea , Rcom and M&M were major Nifty gainers with gains of more than 6%. Resignations of various board directors has somehow boosted investors moral with Satyam. Within last 2 sessions Satyam has shown nice upmove of more than 20%.

Today's Nifty Spot levels were
Open 2922.55
High 2999.15
Low 2899.75
Last 2979.50
Prev. 2922.20
%Change 1.96%

As for tomorrow strategy Nifty again is moving in its resistance zone where it will face pressures from overhead supply . On upside Nifty will face major resistance around 3075-3090 range. Supports and resistance for NIFTY futures for tomorrow are as:

Support s1 2940 , s2 2980
Resistance r1 3030 , r2 3090

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Monday, December 29, 2008

Nifty Levels - 29 Dec 2008

Nifty today opened in red & traded 1.5% down but ended day on a positive note up more than 2% because of anticipation of new stimulus package from govt. SAIL and SATYAM helped Nifty a lot with both moving around 10% up in the day. RANBAXY , CAIRN and ICICIBANK were other major movers , all moving around 7%.

Today's Nifty Spot levels are as:

Open 2857.15
High 2931.80
Low 2812.90
Last 2922.20

Prev. 2857.25
%Change 2.27%

As mentioned in Friday's post Nifty took support around 2820 levels to bounce and breach second resistance level of 2930 but ended close to it at 2922. For tomorrow Nifty has the following supports and resistance levels:

Support s1 2880, s2 2850
Resistance r1 2963, r2 2995

For tomorrow market seem to be indecisive. Oil rose near $40 a barrel Monday after the conflict between Israel and Gaza's Hamas rulers raised tensions in the Middle East. This global crisis can affect Indian and world markets. At the time of writing post DOW was trading in red . I hope Dow to fall further if any bad news come from Israel front. This can affect Indian markets also tomorrow.

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Friday, December 26, 2008

Nifty Levels - 26 Dec 2008

After Christmas holiday on Thursday, Nifty today opened in green & tested 2960 levels as mentioned in last post on Wednesday. After the expiry this new series of Nifty was suppose to start in cheerful mood as it did today, but after trading firm for quite some time it lost the momentum & ended in deep red.

While writing the post Dow has also lost some of its opening gains.Dow was trading at 8504 up 35 points after having a upside of 60+ points. Rallies in all the world markets are not sustaining with the momentum which is required. Nifty also traded in same manner today with a good of 40 points on upside it lost all its strength and ended 60 pints in red. Today Nifty spot levels were :

Open 2919.85
High 2960.95

Low 2844.80
Last 2857.25

This shows how perfect that level for 2960 in last post was. Now on Monday traders has to look for 2800 levels on closing basis. Any closing in nifty below that level is confirmation of of Bull slaughter by Bears. On Monday nifty has supports s1, s2 at 2850 and 2820 levels. On upside Nifty will face huge resistance 2880 and 2920 levels. A closing above 2920 will give bulls some relief on Monday.

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Wednesday, December 24, 2008

Nifty Levels - 24 Dec 2008

Markets are behaving in the way expected. Nifty today broke 2920 levels but not convincingly and closed at 2916 in spot. Also because of selling pressures from last 3 days, markets have reached in somewhat oversold range. There seems to comes some unexpected bounce on Friday . The levels for Friday are :

Supports s1 , s2 2880 2850
Resistance r1,r2 2960 2992

Tomorrow all Asian and global markets will remain close coz of Christmas. DOW seems to be in joyful mood with 40 points in green celebrating the pre Christmas day. It is kind of unexpected even though jobless data has grown to maximum.

On Friday Nifty will look for same relief from last 3 sessions selling pressures. So wont be surprised to see nifty going in green & trying to breach 2960 on upper side. But that will be seen on Friday morning till then Merry Christmas

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Tuesday, December 23, 2008

Nifty Levels - 23 Dec 2008

Today Nifty moved along with all its Asian and global partners in crime. Yesterday night DOW was showing signs of weakness and it ended down some 1%. In morning all the Asian indices were trading 2% to 3% down. So at end of day Nifty also followed same global trend and ended red around 2.5%.

Today's Nifty spot data are as:

Open 3039.25
High 3040.00
Low 2957.05
Last 2968.65

As mentioned yesterday Nifty took support around 2960 levels. You can see from last so many posts Nifty is respecting the levels mentioned on the blog. Although Nifty took support at 2957 & closed at 2968, but i can still say Nifty is not showing any major trend. It will be nice to see that on future downside how does Nifty behaves at 2920 tomorrow.

For markets to show a major trend its important to come out of trading range of 2920 to 3130 either side. Till then Nifty will be moving in this close range. I still think that recent upmove has fizzled out and this was again one of those dead cat bounces of market. Nifty can again do retest of immediate bottom formed at 2250 levels.

For intraday traders Nifty has supports s1 and s2 lying at 2930 and 2880 levels. For upside Nifty will face resistance at r1 and r2 at 2990 and 3030 levels. But the most important level to watch tomorrow is of 2920. Any close below this level will hurt Bull sentiments and boost Bears moral.

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Monday, December 22, 2008

Nifty Levels - 22 Dec 2008

Nifty again performed as the the way it was mentioned in friday's post. Nifty today was again in some profit booking spree with Reliance and ICICI bank acting as draggers. Nifty Spot levels for today were:

Open 3077.25
High 3110.45
Low 3027.80
Last 3039.30

As mentioned in last post Nifty took support around 3030 levels and closed near it. This signals a kind of weakness in Nifty with immediate resistances R1, R2 at 3090 & 3135 levels. On downside Nifty has supports S1, S2 at 2995 and 2960 levels. However short term immediate support is at 2920 levels which is a major weekly support for NIFTY.

While writing the post DOW has recovered 35 points and now trading up 6 points. there is no major news coming from domestic and global fronts too. So as of now Nifty is expected to behave in range from 2920 to 3130 for short term. Breaking either side will decide future course of action.

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Friday, December 19, 2008

Nifty Levels - 19 Dec 2008

All those who read my yesterday's post must have seen the accuracy of Nifty levels mentioned. Yesterday i especifically mentioned Nifty to face resistance at 3105 level & having support of day at 3030 levels. Just look at Nifty Spot levels of today below:

Open 3063.00
High 3106.80
Low 3036.30
Last 3077.50

Nifty followed exactly same levels & reversed from 3036 but faced resistance at 3106. I think a trader who has actually played with my figures must have earned at least 70 odd points in futures.

Speaking for Monday, there is intense TUG of war like situation going around in NIFTY. Today Nifty went till 3106 levels on the anticipation of another CRR cut by RBI. Bank Nifty was major help for Nifty along with Reality sector. While writing the post Crude was at five year low levels of 34$/bbl inspite of major supply cuts from OPEC. For Mondays Nifty's immidiate resistance is at 3130 level with support lying at 3030 , 2995 ,2960 levels. Any downside to 3030 can be taken as opportunity to go long for 3130 in Nifty.

Also there seems to be big money coming in play for 3100 call & 3300 calls which may be a hedge against the positional shorts. I find Nifty to still move in range . I still want Nifty to come out of 3240 levels with good volumes for further upside of 3500 which will be the ultimate target for NIFTY. But there is huge downside still left. I am not very sure with the exact bottom but 2252 is acting at short term bottom for this rally which can atmost go to 3500 levels.

But be sure this is not the end of pain till we dont cross 3500 levels in NIFTY. On downside i am still expecting a test for 2252 in coming levels. So get geared up for this huge TUG of War between BULLS & BEARS .

PS:: These reports are being written before US markets opening on friday, & weekly offs are there on saturday & sunday. Any major bankruptcy announcement can be a bad news for world economy . So please follow levels taking those news also into account.

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Thursday, December 18, 2008

Nifty Levels - 18 Dec 2008

I was not able to post Nifty Levels yesterday coz of personal emergency. But Nifty behaved in the same way as was mentioned in previous post.

As mentioned in last post Since yesterday bulls were able to save 2930 so there was some hope left for today. Good news in form of low inflation numbers of 6.84% against the expected 7% helped bulls in the mid of day.

Today Nifty was able to present a good show & was able to make a sustainable show around 3050 and closed above 3050 mark at 3060. Same way for SENSEX also we were able to close a sentimental mark of 10000. But yesterday's market's behaviour says that we need a monthly closure above 10,500 mark of SENSEX so that this rally to get extended around 11,600 to 12,500 levels.

For Nifty these levels come out to around 3300. So a sustained closing above 3240 will make NIFTY look for more higher territory of 3500. Till these levels are not sustained we can see NIFTY in a close range from 2880 to 3050.

For tomorrow, Nifty will face resistance at 3105 levels. On downward side NIFTY has intraday major supports S1,S2 & S3 as 3030 , 2995 ,2960 .

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Tuesday, December 16, 2008

Nifty Levels - 16 Dec 2008

After continuous efforts of two days Nifty Levels was able to cross Hurdle of 3030. Tomorrow is an important FOMC MEET which is supposed to decide about Fed's future rate decision. FED interest rate is on 1% so another cut will actually bring it near to nothing i.e, ZERO. So even at this levels anything done by FED is important for sentiments of world economies rather than technicals.

For Nifty Upside seems to fizzle around 3150-3300 levels. A good upmove above this channel will help BULLS much sentimentally . Any downside below 2860 levels will boost BEARS morals & then they will try with their full strength for testing October lows of 2200. But if Bulls are able to save 2930 then may be they can see some more greener pastures in NIFTY.

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Monday, December 15, 2008

Nifty Levels - 15 Dec 2008

NIFTY Support 2881 ON DOWNSIDE.Breach of which will see 2860 AND 2980 LEVELS is a resistance. Before the Outcome of the FOMC MEET on Wednesday traders can see profit booking as 50 bps reduction in interest rate is discounted.

call writers are seen at 3000 ce strike price. TRADERS should HAVE A SL AT 2890 LEVELS FOR LONGS and a sl at 3045 for shorts.

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Thursday, November 27, 2008

Nifty levels - 27 Nov 2008

Nifty & BSE both Indian stock markets were shut down due to Mumbai terror attacks. Expiry date for this month's futures contracts is postponed for tomorrow i.e, 27 Nov 2008.

Mumbai attacks are the first of its kind seen by the nation. The scale of destruction & the retaliation shown by terrorist make all of us think hard about our safety. These terrorists have been popping out like cockroaches & it seems common man is not safe inside their toilets even.

Let us condemn these attacks from our full strength!!!!

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Wednesday, November 26, 2008

Indian Bailout Schema

Have you ever feel surprised why India is OUTSOURCING capital of world?? Well if the answer is YES then here is another proof of why outsourcing things to INDIA can be so much COST EFFECTIVE to the world(especially USA).

We have heard a lot about US Economy Bailout Packages. So back with bang here comes Indian version of Economic Bailout .Whatever the US government is doing with $800 billion with an anticipation of a 4 to 5 year time frame we Indians can do just in Rs. 150 crores (or $30 million being specific) within 2 year time frame.

So world keep on outsourcing to us!!!

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Nifty Levels- 26 Nov 2008

From today i am starting a series of regular posts about technical levels of NIFTY Futures to be used for short/medium term NIFTY FUTURE players. For making things short & sweet lets go directly on the expected levels for nifty in short term.

As of today, on 26 Nov 2008 Nifty futures managed to cross 2763 which completes the 50% fibonacci retracement from the levels of 2228 and 3299 and closed near to it so next target should be 2840/2885/2945 in short/medium term.

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Wednesday, October 1, 2008

Micro Technologies launches Micro SAMS

Mumbai-based Micro Technology Ltd. launched unique software in the city today. The Micro Students Attendance Management System, (SAMS) is an automated system for access, attendance and effective communication

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Tuesday, September 30, 2008

TCS wins WS Journal Global Innovation Technology Award

Tata consutancy services a leading global IT services and business solutions firm today announced that the world’s leading business publication, has selected TCS’ mKrishi service as the winner of its 2008 Technology Innovation Award in the wireless technology category. The award recognizes companies, individuals and organizations world-wide for technological breakthroughs in such areas as medicine, the Internet, wireless and consumer electronics.

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Lehman Brothers bankruptcy impact on Indian IT market

With Lehman Brothers filing for bankruptcy and Bank of America taking over Merrill Lynch; the key question would be - do these companies have significant exposure to the Banking, Financial Services and Insurance (BFSI) space and what would be the impact?

Lehman Brothers, which has filed for bankruptcy, seems to have very little outsourcing done as of now and the exposure remains with Wipro and Tata Consultancy (TCS). Wipro has given a statement that Lehman Brothers is not such a significant client and they are not worried about it. TCS may not see much of the impact.

But one needs to watch out for what happens with Merrill Lynch because Merrill Lynch was a significant client for both Satyam and TCS. The one which is going to suffer from Merrill Lynch’s takeover is going to be Satyam because it was a significant top client for them. Where TCS gains over Satyam is it has in relationship with the acquiring company Bank of America, which gets more outsourced work.Infosys and Bank of America have a very steady relationship. So Infosys maybe one of the gainers.

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Friday, September 12, 2008

You Can buying and selling of dematerialised securities

You Can buying and selling of dematerialised securities

a. selling dematerialized securities

b. purchase dematerialized securities.

selling dematerialized securities

The procedure for selling dematerialized securities is very simple. Procedure for selling securities is given here below:

  1. You sell securities in any of the stock exchanges through a broker;
  2. You give instruction to your DP to debit your account and credit the broker's (clearing member) account before the deadline time specified by your DP;
  3. Before the pay-in day, your broker gives instruction to its DP for delivery to clearing corporation;
  4. Your broker receives payment from the stock exchange (clearing corporation);
  5. You receive payment from the broker for the sale of securities.

purchase dematerialized securities.
For receiving demat securities you may give a one-time standing instruction to your DP. Procedure for buying securities is given here below:

  • You purchase securities through a broker;
  • You make payment to your broker who arranges payment to clearing corporation on the pay-in day;
  • Your broker receives credit of securities in its clearing account (clearing member account) on the pay-out day;
  • Your broker gives instructions to its DP to debit its clearing member account and credit your account;
  • You receive shares into your account. However, if standing instructions are not given at the time of opening the account, you will have to give 'Receipt Instructions' to your DP for receiving credit.

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Stock Markets?

A stock market is a market for the trading of company stock/ shares, and derivatives. Market is a place where buyers and sellers of securities can enter into transactions to purchase and sell shares, bonds, debentures etc. It also enables corporates, entrepreneurs to raise resources for their companies and business ventures through public issues.

    1. Primary Stock markets:
      The primary market is that part of the capital markets that deals with the issuance of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue. This is typically done through a syndicate of securities dealers. In the case of a new stock issue, this sale is an initial public offering (IPO)

b. Secondary Stock markets:
The secondary market is the financial market for trading of securities that have already been issued in an initial private or public offering. The secondary market is where you can purchase securities from the seller as opposed to the issuer of such a security.

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What is a stock exchange?

A stock exchange, share market is a corporation or mutual organization which provides facilities for stock brokers and traders, to trade company stocks and other securities .The securities traded on a stock exchange include: shares issued by companies, unit trusts and and bonds.

There are two type of stock exchange

:-Bombay Stock Exchange Limited or BSE

:-National Stock Exchange or NSE

what are sensex and nifty

The Sensex is an "index". What is an index? An index is basically an indicator. It gives you a general idea about whether most of the stocks have gone up or most of the stocks have gone down.

The Sensex is an indicator of all the major companies of the BSE.

The Nifty is an indicator of all the major companies of the NSE.

If the Sensex goes up, it means that the prices of the stocks of most of the major companies on the BSE have gone up. If the Sensex goes down, this tells you that the stock price of most of the major stocks on the BSE have gone down.

Just like the Sensex represents the top stocks of the BSE, the Nifty represents the top stocks of the NSE.

Just in case you are confused, the BSE, is the Bombay Stock Exchange and the NSE is the National Stock Exchange. The BSE is situated at Bombay and the NSE is situated at Delhi. These are the major stock exchanges in the country. There are other stock exchanges like the Calcutta Stock Exchange etc. but they are not as popular as the BSE and the NSE.Most of the stock trading in the country is done though the BSE & the NSE.

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Tips for Avoiding investment Scams, from the Internet Fraud Watch

· Don’t believe claims that there is no risk. There is always risk in investments, and no one but a con artist will tell you otherwise. Know the risk before you invest.

· Beware of promises that you’ll make big profits fast. No one can accurately predict how an investment will do. Often the investments that promise the most pay-off are also the most risky.

· Get the details in writing. Legitimate companies will be happy to give you all the information you need.

· Don’t agree to anything on the spot. Pressure to act immediately is a danger sign of fraud.

· Understand your investments. Do you know the difference between stocks and bonds, margin accounts and cash accounts, options and futures, mutual funds and certificates of deposit? If not, do your homework before you invest.

· Don’t act on testimonials from strangers. Someone who appears to want to share a friendly tip about a great investment opportunity may actually be a con artist trying to lure you into an investment scam.

· Be especially wary of investments in commodities. Crooks often promise that the value of investments in coins, precious metals, artwork, oil leases, gemstones, and other commodities will rise. The truth is that the value of these types of investments can go up or down significantly.

· Steer clear of “offshore investments.” These are often promoted as a way to avoid taxes. Actually, you are still liable for taxes, and the investments themselves are usually very risky.

· Be cautious about emails for investments. Many unsolicited emails are fraudulent.

· Take the time to check out investment offers. A good place to start is with your state securities regulator. Other resources for information to help you make wise investment decisions include: the federal Securities and Exchange

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Tuesday, August 26, 2008

HCL Technologies to acquire Control Point Solutions

HCL Technologies Ltd. (HCL), India’s leading global IT services provider, today announced signing of an agreement to fully acquire Control Point Solutions, Inc., the leading provider of voice, data and wireless Telecommunications Expense Management (TEM) services. Privately held, Control Point Solutions (CPS) leads the TEM market with robust platforms catering to both enterprises and carriers across industry verticals. As part of the transaction, HCL will acquire four delivery centres in US with over 200 professionals who come to HCL with domain knowledge and technical expertise. Control Point Solutions is being acquired at an enterprise valuation of USD 20.8 million. This valuation is on cash free and debt free basis.

This acquisition strengthens HCL’s unique advantage of providing multi-service delivery platforms for our customer with CPS’ TEM expertise complementing HCL’s remote infrastructure service offering. Control Point Solutions is a market leader in the highly fragmented TEM industry with its internally developed robust platforms. Control Point Solutions’ technology has been a key differentiator that has demonstrated capability to support both the Enterprise and Carrier segments. Control Point Solutions customers include Fortune 500 organizations across a broad variety of industries. For nearly two decades, Control Point Solutions has managed the entire telecom expense life cycle for clients, providing industry-leading solutions for their voice, data and wireless requirements.

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NIIT is a ‘Superbrand’

For the second time, NIIT, the Global Talent Development Corporation has been accorded Superbrand status. At a recently concluded award ceremony held in the Capital, NIIT has been adjudged as a Business Superbrand 2008, commanding consumer respect, loyalty and trust by the Superbrands Council, from amongst consumer brands across categories.

The prestigious Superbrand status is internationally known as the ‘Oscars in the world of branding’. NIIT will be listed in Superbrands India’s very second edition of the book ‘Superbrands,’ a chronicle of India’s strongest brands. The prestigious award was received by Mr. P Rajendran, Chief Operating Officer, NIIT. Mr. P. Rajendran, Chief Operating Officer, NIIT, said, ”Being conferred the coveted Superbrand status for the second time, is a reiteration of the faith placed in us by our stakeholders. Having pioneered IT training in India, NIIT is now poised to emerge as a leading Global Talent Development Corporation.”

This is not the first time that the strength of NIIT brand has been recognized. NIIT was recently honoured with the Digital Opportunity Award at World Congress on IT held in Kuala Lumpur, for its pathbreaking Hole-in-the-Wall Education Initiative. Also at the recently concluded 2008 International Business Awards, NIIT won an International Stevie Award for the Most Innovative Company in Asia (Subcontinent, Australia and New Zealand). UN World Body UNESCO also presented NIIT with a Commendation Certificate for its innovative science station.

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Cummins India wins CII?s National Award

The Power Generation Business Unit of Cummins India Limited has won the Confederation of Indian Industry (CII) National Award for Excellence in Energy Management in the category of “Innovative Energy Saving Product / Service” for the third successive year. The award has been conferred upon Cummins for its unique “Power Quality & Adequacy Analysis” service designed to ascertain source and load compatibility. This award was conferred during the “National Award for Excellence in Energy Management” function held in Pune on August 23, 2008.

Cummins has been the recipient of this prestigious award twice in the same coveted category for the last two years. In 2007, the Company received the Award for its Producer Gas Genset, while the Real Time Power Factor Control (RTPFC) system won the Company the CII Award in 2006.

resource :- www.nseguide.com

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Monday, August 11, 2008

Bajaj Hindusthan Ltd

Source: BSE - Bajaj Hindusthan Ltd has announced the following Unaudited results for the quarter ended June 30, 2008: The Company has posted a net loss of Rs 354.10 million for the quarter ended June 30, 2008 as compared to net loss of Rs 604.70 million for the quarter ended June 30, 2007. Total Income has decreased from Rs 4940.80 million for the quarter ended June 30, 2007 to Rs 4731.40 million for the quarter ended June 30, 2008.

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Monday, August 4, 2008

Buy Recommendation - Torrent Power

Keep buying on Torrent Power with a target price of Rs 146 . The company has posted excellent results for the quarter ended June 2008. The net sales for Q1FY09 stood at Rs 11133.50 million against Rs 8978.70 million in Q1FY08 depicting a growth of 24 %. The expenditures have grown at 20.95% clearly depicting the strength of the company. EBITDA for Q1FY09 stood at Rs 1412.30 million, showing a sharp surge of over 50 % from the previous year’s levels.

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Monday, July 14, 2008

Buy Recommendation

keep buying on Infosys Technologies as a market performer with a one-year target price of Rs 1690. Excluding the tax reversals (Rs 310 million in Q1 FY09 and Rs 200 million in Q4 FY08), net profit grew by 3.4% qoq. Company reported lower than expected forex loss of Rs 800 million. Further, tax provision excluding any reversal was lower at 10.7% in Q1 FY09 compared to 15.6% in Q4 FY08.

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Saturday, July 12, 2008

Buy Recommendation

keep buying on Bajaj Auto. Bajaj Auto’s 1QFY09 standalone numbers were below our estimates at EBIDTA (by10%) and Net profits (by 8%) level. There are no comparable numbers on YoY basis onaccount of demerger. We attribute the variation to (1) higher pressure on the rawmaterial front. Raw material as a % of sales was at 75.5% against our expectation of 73.3%. (2) Higher effective tax rate 33% against our expectation of 29%. The keyreasons for the deviation vis a vis our estimates are that we had factored in higherprofitability of Pantnagar plant, resulting in lower RM to sales ratio and also lowereffective tax rate on the assumption of direct tax benefits from its Pantnagar plant.Adjusting for the higher tax rate the net profits would have been Rs 1.85, against ourexpectation of 1.9 bn.

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Wednesday, June 25, 2008

Buy Recommendation

Keep buying on Mahindra and Mahindra with a target price of Rs 800. According to media reports, Mahindra and Mahindra (M&M) will be selling a 10% stake in its used car business, Mahindra First Choice (MFC), to PHI Advisors for about Rs 80 crore. The company's management, in a media interview, has said that it plans to infuse Rs 20 crore via rights issue and Rs 60 crore via a stake sale into MFC. In case there is a 10% stake sale for Rs 80 crore, MFC's enterprise value would rise to Rs 800 crore.

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Friday, June 20, 2008


India's inflation, based on the wholesale price index (WPI), soared to 11.05% for the week ended June 7 versus 8.75% in the preceding week.

This is the highest level of inflation in India in the last 13 years.

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Buy Recommendation

Keep buying on Ranbaxy Laboratories with a target price of Rs 585.Ranbaxy has entered into agreements with Pfizer Inc to settle patent litigation worldwide involving Lipitor in US ( USD 8 billion) and 7 other countries (USD 2.5 billion). The settlement also involves Caduet USD 400 million (combination of Atorvastatin and Amlodipine).

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Thursday, June 19, 2008

Nuclear Deal - problem for congress

RJD chief Lalu Prasad and DMK supremo M. Karunanidhi express their support to the Prime Minister. CPI (M) leader Sitaram Yechury says Left may withdraw support

Even as the Left parties threatened to pull the rug from under it's feet, the Congress on Thursday received backing from two of its key allies over the civilian nuclear deal with the United States.

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Advice and Suggestion for Investors - II

The market is expected to move down again, so one should select fundamentally sound stocks and buy them in a staggered way at every fall, says market expert, Ashok Ajmera, on Zee Business. Also, invest for the long term to gain more, he suggests.

The market seems ranged for now, but much of the froth is out. Going forward, one should not expect any surprises in Q1 numbers. The MF house is underweight on real estate, pharma and FMCG.

HDFC Mutual Fund advises retail investors to invest at every dip in the market. The MF house expects superior returns in 15-18 months from the Indian markets. Indian markets are getting closer to fair value now.

The market is expected to move down again, so one should select fundamentally sound stocks and buy them in a staggered way at every fall. Also, invest for the long term to gain more.

Any good moves in the oil marketing companies should be used to book profits. Their gains may not be sustainable.

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Buy Recommendation

Keep buying on Gujarat Mineral Development Corporation with a target price of Rs 443.Being the leading lignite merchant in the country, the company already stands in a pioneer position in the sky rocketing coal prices regime. With the allotment of coal blocks in Chattisgarh and Orissa, the company shall be able to feed 4750 MW power and if negotiations with PIPDC prove fruitful, the company will also be able to gener-ate maximum benefit from the block through its expertise.

Also, the company’s diversification into cement, power, SEZ and port arena is expected to increase future earnings visibility by securing captive coal customers through the proposed JVs. The stock at the current market price of Rs 304 trades at 18.31 times to its earning per share of Rs 16.60 and 4.55 times to its book – value of Rs 66.77. The stock looks attractive at the current valuation with the strong upside potential in the long term investment horizon.

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Wednesday, June 18, 2008

Market View - Small Bull Run Can Start

The bulls may have regained some lost ground with bears covering their shorts in the last couple of days. Global markets too have big held up quite well and oil prices have retreated a bit. Lack of fresh bad news coupled with buying by local institutions have kept the bears on the defensive in the last two days. FIIs turned net buyers in the cash segment yesterday. However, it remains to be seen whether the current momentum can be sustained, as the bulls still lack conviction.

Mutual funds may be sitting on a huge pile of cash, but the market needs FIIs to turn net buyers in a big way. In short the FIIs have to light the fuse to ignite positive action in the Indian bourses. Plus, the macro and micro environments have to change drastically. The flow of bad news has to slow down. All this will take a while to materialise. As a result, the market will remain largely rangebound and choppy with alternate bouts of buying and selling. It’s a no brainer that this outlook is subject to global market conditions and improvement in local fundamentals.

Today, we expect another cautious to slightly positive start, as the US indices fell overnight but most Asian markets are on a firm ground. The overall trend could slightly favour the bulls purely due to the current momentum though there may be some cooling at higher levels.

Results Today: Aurobindo Pharma, Dish TV, Era Infra, Finolex Industries, Greenply, Hotel Leela, Indraprastha Gas, Kei Industries, Marg, Mascon Global, Power Grid Corp., PNB and Rajesh Exports.

FIIs were net buyers of Rs1.4bn (provisional) in the cash segment on Tuesday while the local institutions poured in Rs4.2bn. In the F&O segment, foreign funds were net buyers of Rs9.51bn. On Monday, FIIs were net sellers of Rs5.33bn in the cash segment. With this, they have pulled out over $5.5bn from the Indian market this year.

Resources - Indiainfoline News Services

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Tuesday, June 17, 2008

Buy Recommendation

Keep buying on Bharti Airtel with a target price of Rs 1035. The company is a market leader with a market share of all India wireless subscribers at 23.8% as at FY08 end (22.4% last year). The enterprise services division provides carrier (long distance services) and other services to corporate clients. Bharti has completed acquisition of a 100% stake in the i2i cable system connecting India to Singapore for USD 110 million. It has also won the license to offer 2G and 3G services as the fifth mobile operator in Sri Lanka. This is in line with its corporate strategy of expanding operations in high growth emerging markets.

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Monday, June 16, 2008

Tata Steel forms JV with Jasper Industries

Tata Steel said on Monday that its wholly owned subsidiary, Rawmet Ferrous Industries Ltd. has entered into a share subscription agreement and shareholders' agreement with Jasper Industries.

The three companies will build a coal-based power plant of 2 x 67.5 MW capacity at Anantpur Village, Cuttack, Orissa, subject to the fulfillment of certain conditions.

Pursuant to the shareholders' agreement, Tata Steel and Rawmet together will hold 26% and Jasper Industries will hold 74% stake in Bhubaneshwar Power Pvt Ltd (the JV company).

Resources - Indiainfoline Ltd

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Buy Recommendation

Keep buying on GAIL India with a target price of Rs 485.With robust growth in gas transmission business, we expect GAIL to witness revenue CAGR of 25.1% during FY08-10E. The only concern is a margin decline on account of petrochemical business and subsidy burden.the stock is attractively valued at FY10E P/E (adjusted for value of listed investments) of 8.1x.In the near term, likelihood of a bonus issue could provide momentum to the stock.

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Buy Recommendation - Jyoti Structures

Keep buying on Jyoti Structures with target price of Rs 200.The company has posted compounded annual growth rate of 46.08% in top line and 84.50% in bottom line in last three years and is expected to maintain its growth in coming years. The company is a leading player in the domestic power transmission EPC segment and has executed transmission line projects in around 30 countries. Capability of constructing substations gives JSL the distinction of being a total turnkey EPC contactor for power transmission lines, differentiating it from other major players in the industry. Opportunities in the form of increased government thrust on improving the transmission and distribution infrastructure of the country is expected to drive the future growth of the company. The stock at the current market price of Rs 121.90 is trading 13.67 times to its earnings of Rs 8.92 and 2.90 times to its book value of Rs 42.03. We initiate a ‘BUY’ signal on the stock at the current levels with a target of Rs 200 in the medium to long-term investment horizon with an appreciation of 64%.

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Friday, June 13, 2008

Inflation hits 7-year peak

The Government's worst fear of a double-digit inflation may soon come true, as inflation has climbed to its highest level in seven years and may jump to a double-digit mark on the back of the recent hike in fuel prices.

Inflation, based on the wholesale price index (WPI), rose to 8.75% in the week ended May 31 from 7.24% in the previous week, the Commerce & Industry Ministry said in a statement. The reading is much higher than average forecast of 8.25-8.35%.

Inflation is now at the highest level since February 10, 2001 when it was 8.77

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Buy Recommendation - Tata Sponge

Keep buying on Tata Sponge Iron with a target price of Rs 294.The sponge iron scenario looks quite lucrative relying on the ever increasing demand for steel and higher impetus to the infrastructural de-velopment by the government. The company has been working on its expansion plans and is well placed in Orissa with access to all the raw materials required. With an expectation of continuance of the price robustness witnessed in sponge iron in the last 12 months, the company shall be able to couple higher realizations along with higher sales.

The stock at the current market price of Rs 245 will trade 3.95 times to its earning per share of Rs 62.03 and will trade 1.49 times to its book – value of Rs 164.87. The stock looks attractive at the current valuation with the strong upside potential in the medium term investment horizon.

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Thursday, June 12, 2008

Buy Recommendation - Reliance Industries

Keep buying on Reliance Industries for target Rs.3200. they are increasing our FY09 and FY10 crude price and exchange-rate estimates as well as building-in lower refining and petrochemical margins for Reliance Industries (RIL). They are also factoring-in an expected delay in commencement of production from the KG D6 block and operations of the Reliance Petroleum (RPL) refinery commencing September ’08. Recent Government decision to keep private companies out of the purview of subsidy sharing is positive. However,
value of RIL’s extant petrochemical and refining business at Rs 1381 per share, retail at Rs 140 per share, E&P at Rs 1,168 per share and RIL’s stake in RPL at Rs 343 per share.

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Market View 12/06/2008

Market open in red but after 1-2 hours it may be turn into green. All asian and US market in red. there is a curcial level at 4435. Market will go up side only if level 4435 are maintained. reality stocks and power stocks are in good and fare price.
One can keep buying on these sector.

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Wednesday, June 11, 2008

Buy Recommendation - Indraprastha Gas

Keep buying on Indraprastha Gas with a target price of Rs 135.The revenue growth of 14.6% YoY (QoQ growth of 3.0%) to Rs 1,882 million. expectaion of CNG sales volume growth of 13.0% YoY, which is likely to be the main growth driver as it accounts for around 90% of total sales. Overall, the net profit is expected to increase by 16.7% YoY to Rs 467 million translating in to EPS of Rs 3.3 during the quarter.

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Tuesday, June 10, 2008

Some Corporate News

Rashtriya Chemicals & Fertilizers (RCF), the country’s largest fertiliser maker, is looking to diversify into logistics related businesses.

Automotive engineering major Renold Plc today said it is in talks with Indian firm LG Balakrishnan & Bros for acquiring 75 per cent stake in its industrial chain
business for an undisclosed amount.

Sadbhav Engineering, a construction firm, on Monday said it will acquire 74 per cent stake in Hong Kong based Ocean Bright Corporation for an undisclosed amount.

Pharmaceutical firm Zydus Cadila on Monday said it will acquire 70% stake in South Africa-based generic firm Simayla Pharmaceuticals for an undisclosed amount.

The Aditya Vikram Birla group-controlled Idea Cellular is set to acquire BK Modi's 40.8% stake in Spice Communications for around Rs 2,200 crore.

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Educomp Solution's New contracts

Educomp Solutions has secured contracts from 395 schools under the ICT segment comprising 208 schools in Rajasthan, 187 schools in Jharkhand. With these orders the total number of schools in the Educomp portfolio has gone up to 6,399.

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UB Group's Plan

UB Group is now planning to offer stake in the low cost airline Deccan, once its merger with Kingfisher Airlines is sanctioned to raise funds for future expansion.

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News for Cadila Healthcare

Cadila Healthcare Ltd (Zydus Cadila) on Monday
announced acquiring a 70 per cent stake in Simayla
Pharmaceuticals of South Africa, through its wholly
owned subsidiary Zydus Healthcare SA Pty Ltd, for an
undisclosed amount.

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RPG Life Relisted

RPG Life Sciences got re-listed today at Rs 49 at the Bombay Stock Exchange. RPG Life Sciences, erstwhile Searle India, is engaged in the manufacturing and marketing of bulk drugs and formulations

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Buy Recommendation- Tata Motors

keep buying on Tata Motors with target price of Rs 785. the acquisition at 5.9 times EV/EBIDTA of an entity that has 5.5% EBIDTA margins, (after charging USD 829 million of R&D spend) is not expensive at all. A valuation comparison with similar sized companies or companies with similar product profile, indicates that acquisition is reasonably priced. Similarly, contrary to the perception, despite of 45% equity dilution for funding the acquisition, the deal is not value destructive. Based on JLR’s CY07 numbers the acquisition is EPS neutral.

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Monday, June 9, 2008

What are P-Notes?

What are P-Notes?

Participatory notes (P-Notes) are financial instruments used by hedge funds not registered with Sebi.

* Hedge funds invest in Indian stocks through custodians in India

* P-Notes are issued by registered FIIs to overseas investors who want to invest in India without registering

How do P-Notes work?

* India-based brokerages buy India-based securities and then issue P-Notes to foreign investors

* Any dividends or capital gains collected from the underlying securities go back to the investors

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Friday, June 6, 2008

Report for Tata Motors

Keep buying on Tata Motors with target price of Rs 780.Tata Motors (TML) has underperformed the broader markets (since July 2007, the stock price declined by 23%, against 4% returns generated by sensex) since the management announced the intention to acquire Jaguar and Land Rover (JLR). The recent right issue announcement by the management was much higher than the street expectations. As a result, the underperformance accelerated since April 2008.The stock price of TML declined by 15% against the decline in sensex by 1%. At Rs 541, the stock trades at 9.2 times its FY08 consolidated EPS of Rs 58.6

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Spice Jet full report

Anil Ambani, chairman of the Reliance-Anil Dhirubhai Ambani Group (ADAG), is planning to enter into the troubled world of aviation. According to reports, the younger of the two Ambani scions has initiated talks with Gurgaon-based low-cost carrier SpiceJet.

Shares of SpiceJet rose as much as 23.4% after a business daily reported that Anil Ambani was in the race to buy a majority stake in the no-frills airline. According to the newspaper, Anil Ambani is competing with Jet Airways and Kingfisher Airlines.

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Inflation Rate at 45-months peak

India's inflation, based on the wholesale price index (WPI), rose further in the penultimate week of May even as the country braced for even higher prices following the much-anticipated hike in retail fuel prices.

The annual point-to-point inflation increased to 8.24% in the week ended May 24 from 8.1% in the previous week, the Commerce & Industry Ministry said today. The rate is slightly below the average expectations of 8.29%.

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ICICI Bank Revises NRI Deposit Rates

ICICI Bank Ltd announced today that it has revised its interest rates on NRE Fixed Deposits and FCNR Deposits with effect from June 01, 2008.The interest rates on one year NRE Fixed Deposits have been increased to 3.16 % p.a. while one year FCNR Deposits denominated in US Dollars have been increased to 2.41% p.a.

Interest rates on one year GBP denominated FCNR deposits have been increased to 5.40 % p.a.

Source : Adfactors Public Relations Pvt Ltd

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Thursday, June 5, 2008

Report for Godawari Power

Keep buying on Godawari Power & Ispat with a target price of Rs 418. At the CPM of Rs 194, the stock is trading at 2.8X our FY10E FDEPS of Rs 69.6 and at 2.3X on FY10E EV/EBITDA. For target price of Rs 418 (with potential upside of 115%).

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Report for Shiv Vani Oil

Keep buying on Shiv Vani Oil & Gas Exploration Services for DCF based target price of Rs 716, offering 28% upside from current levels.Bull case target price is Rs 840 (50% upside from current levels) and bear case price Rs 454 (19% downside from current levels).

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Ashok Leyland Sales Report in May

Ashok Leyland has declared its May sales numbers. The company's May sales were at 5576 units versus 5804 units on YoY basis. The company's May domestic sales stood at 5161 units versus 5436 units on YoY basis.

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Advice and Suggestion for Investors

Advice and Suggestion for Investors is that this is the time when one can look out for cheaply valued stocks and accumulate them. Markets are range bound and are expected to bounce back soon. So pick the scripts that have corrected well and hold them for good returns.one should Avoid short term picks, try to remain short below 4640 nifty spot levels.
Reliance Industries, L&T and SBI would make very good value picks for those who want to invest in the long term.
Bharti looks a good buy around Rs 800 for the long term.
DLF is also very good for pick at these level for short term.
some other stock like KSoil,Ispatind,Ashokley,TTML is also at arractive price.

The market is showing weakness due to lack of buyers. The market is likely to consolidate on the downside and recovery is likely to take long now. The banking stocks have been battered down. In the power space, NTPC still looks attractive at current levels for a long-term buy.

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Wednesday, June 4, 2008

Report for Sterlite Industries

One can keep buying on Sterlite Industries (India) with a target of Rs 953. "Sterlite annoucned acquisition of ASARCO, American copper smelting and refining company having a smelting capaictity of .25mtpa and 3 copper mines with a total reserve of 5mt in copper. The 2.6 billion acquisition is an all cash deal with no dilution. Sterlite will fund the acquisition through debt and internal accruals. Sterlite currently has almost USD 3 billion net cash as at 31st march 2008. We view the acquisition as extremely positive and expect Sterlite to improve the performance of the company further given its ability to turn around companies (like BALCO, HZL, MALCO)."

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Market View for tomorrow 5/06/2008

Markets will now move on. From tomorrow morning, I don’t think this oil price hike will be the central issue for the market. When we get to a few Friday’s later, we will keep talking about inflation and what impact this has had on inflation or WPI number. To that extent, it will become material for the market.All adjustments, which need to be made in terms of specific stocks or the market per se, any adjustment of trader positions before and after the event would have been done by the end of the day.Tomorrow morning this will become a little bit of a non-event. But for that and for the near term, one will see some adjustments, particularly in short covering, which has taken the Nifty to above 4,700, on the back of a big constituent ONGC which has moved up quite sharply.

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Report for Punj Lloyd

One can keep buying on Punj Lloyd with a price target of Rs 420. "For Q4FY08, Punj Lloyd’s (PLL) revenue increased 38% YoY to Rs 23.5 billion, while PAT was up 35% at Rs 1,194 million. EBIDTA margin was strong at 10.6% representing a 60bps YoY improvement. For the full year, revenue grew 51% to Rs 77.52 billion, of which process plants constituted bulk of the revenue at 36%. The other large contributions came from pipelines and infrastructure projects, which constitute 26% and 29% of total revenue respectively. PAT increased 82% to Rs 3.6 billion, including an extraordinary income of Rs 371 million. Adjusting for this, PAT increased 63% to Rs 3.2 billion."

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Petrol prices up Rs5, diesel by Rs3

The UPA Government on Wednesday finally bit the bullet and announced a package comprising a mix of price increases and duty changes to enable the public sector oil marketing companies to combat high crude oil prices.

Speaking at a news conference in New Delhi today, Petroleum Minister Murli Deora said that petrol prices have been hiked by Rs5 per litre while diesel will be costlier by Rs3 a litre.

The Government has also increased domestic LPG price by Rs50 per cylinder. There has been no hike in the prices of kerosene.

The revised fuel prices will come into effect from midnight.

Separately, the Finance Ministry announced a revision in customs duty and excise duty on crude oil and petroleum products to help cushion the common man from the impact of the price hike.

Customs duty on crude oil has been removed from 5% at present. The customs duty on diesel and petrol has been cut to 2.5% from 7.5% while for other products the same is down to 5% from 10%.

Excise duty on petrol and diesel has been trimmed by Re1 per litre each.

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Tuesday, June 3, 2008

Punj Lloyd Results

Punj Lloyd has announced its FY08 results. The company’s FY08 consolidated net sales were up at Rs 7,752.92 crore versus Rs 5,126.58 crore YoY.

Its FY08 consolidated net profit was at Rs 358.42 crore versus Rs 196.93 crore, YoY.

The company's Q4 consolidated net sales were at Rs 2,346.70 crore versus Rs 1,703.55 crore.

During the same quarter its consolidated net profit was at Rs 117.74 crore versus Rs 88.93 crore.

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Monday, June 2, 2008

Report for PFC

One can buy PFC for 2-3 months target of 160-75-85. fundamentally stock is very strong and it will give you more than 20% returns in 2-3 months. current market price is 140.

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Friday, May 30, 2008

Report for Mahindra and Mahindra

One should keep buying on Mahindra and Mahindra with a target price of Rs 730. For 4QFY2008, Mahindra and Mahindra (M&M) clocked net sales of Rs 3148 crore, which was marginally above our expectation of Rs 3021 crore. There was an exceptional profit of Rs 13.9 crore during the quarter, arising mainly from a merger scheme of subsidiaries approved by the High Court of Bombay. Net Profit for the quarter after Exceptional Items, Prior Period Adjustments and Taxation stood at Rs 207.2 crore, down 9.1% yoy.

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Thursday, May 29, 2008

Report for Rolta India

One Should keep buying on Rolta India with a target price of Rs 435. The company management has indicated there is a huge opportunity for it in terms of airport redevelopment, 3D city mapping and work related to power distribution companies (discoms). Rolta is already involved with 26 airport projects across the country. Mapping a single city would be a Rs 1.5-Rs 2.0 billion project. Rolta has hands on experience in this as it has done 3D city mapping for Dubai. We also understand that Rolta is working on nine projects for power distribution companies.

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Some Good Buy Call For investors

Buy HDIL for target of Rs.2050,
Buy Praj induestries for target of Rs.241,
Buy Tatachem for target of Rs.529.

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Decision on fuel price hike

Oil minister, Murli Deora, said on Thursday that the government would take a decision on raising fuel prices in the next two to three days. Earlier it was reported that the government would decide on the fuel price hike on Friday.

The cabinet is expected to discuss a range of proposals to ease losses at state oil firms due to crude oil's record run later on Thursday, and an increase in petrol and diesel prices is one option.

Reports say that the bailout package for oil companies would be a mix of price hike, duty cuts and bonds. The Finance Ministry may also agree to some cut on excise, customs on petro products.

The Petroleum Ministry has been pushing for a Rs 10 per litre hike petrol prices, Rs 5 a litre in diesel and Rs 50 per LPG (cooking gas) cylinder.

In the absence of a hike, state-run oil companies HPCL and BPCL would run out of cash to import crude in the next two months, while Indian Oil Corp has said it would run out of money for buying crude by September-end.

Resources - Economictimes

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Monday, May 26, 2008

Report for ITC

Buy ITC, target of Rs 258:

IndiaInfoline has maintained its buy rating on ITC with a target price of Rs 258 in its May 26, 2008 research report. "ITC recorded 14.7% yoy growth in revenues at Rs 139.5 billion slightly below our expectation of Rs 140 billion during FY08 led by 7.7% yoy growth at Rs 138 billion in the core cigarettes segment. We believe ITC to have recorded a flat growth (or a decline of 1%) in cigarette volumes during FY08. The non-cigarette businesses recorded 18.9% yoy growth at Rs 98.4 billion driven by strong 48.6% yoy growth in FMCG [led by branded packaged foods - 57%, biscuits – 53%, confectionary – 40%, lifestyle retailing – domestic 26%, exports 17%], 10.5% yoy in agri, 12.6% yoy in paper and packaging and 11.6% yoy rise in hotels segment. The leaf tobacco exports recorded a new high in tobacco exports for the third consecutive year growing by 21% yoy in value terms and 27% yoy in volume terms (at 62mn kgs)."

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Increament in petrol prices

Petrol, a fuel used primarily by urban consumers, could soon be selling at market prices. This would mean an increase of Rs 10-16 per litre at current prices.

Officials told ET that a proposal to sell petrol at market prices, while keeping diesel, cooking gas and kerosene at subsidised rates was under consideration. According to a Union minister, some Cabinet members are in favour of market-determined petrol prices. The Cabinet is likely to take up the proposal at a meeting soon, which will discuss a bailout package for state-owned oil marketers.

“With crude oil prices breaching $132/barrel, nothing can be ruled out in the domestic market. Some members in the Cabinet favour prices of petrol to be market-determined, while regulating prices of diesel, cooking gas and PDS kerosene to safeguard the poor and avoid stoking inflation,” he said.

Resources :- Economictimes

“I strongly believe that subsidising petrol not only encourages its misuse but also discourages use of public transport. Having a market-determined price would help in the survival of oil cos without any significant inflationary impact. The poor, anyway, don’t use personal vehicles,” added another Cabinet minister. He added that there were other members with similar views.

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Friday, May 23, 2008

ITC Q4 Results

ITC has announced its fourth quarter and FY08 results. It has posted growth of 13.08% in its Q4 net profit of Rs 735 crore as against Rs 650 crore in same period of last year and 13.5% growth in net sales of Rs 3,934 crore from Rs 3,466.3 crore YoY. Other income stood at Rs 163 crore versus Rs 102 crore.

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Results of L&T

L&T is to announce its Q4FY08 numbers. the company is expected to post standalone profit after tax of Rs 871 crore as against Rs 700 crore in same period of last year.

Net sales is seen going up at Rs 7923 crore versus Rs 6248 crore. EBIDTA is likely to go up at Rs 1336 crore from Rs 809 crore. OPM is expected to improve at 16.86% versus 12.96%.

Factors to watch

  • Strong order backlog execution would lead to a 25% growth in topline
  • Operational efficiences to lead to YoY margin expansion

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Thursday, May 22, 2008

Buy Recommendation - Voltas

cmp: Rs 163.45
target price: Rs 190
Q4 Numbers are lower than our estimates mainly because lower revenue and profit-booking in the projects segment have reduced earnings downwards in FY09 in view of the high steel and aluminium prices, which may constrain margin expansion, especially in the engineering services and products segment

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Buy Recommendation - SAIL

cmp: Rs 176.85
target price: Rs 327
upgrading its earnings forecast for the steel major in FY09 and FY10 by 19.2% and 11.5%, in anticipation of buoyancy in steel prices, introduction of value-added products, operational efficiency and volume growth.

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Buy Recommendation- Dabur India

Dabur India
cmp: Rs 97
target price: 120
he stock was fairly valued at current levels. The brokerage expects the company’s consolidated revenues and earnings to grow at a compounded annual growth rate of 14.7% and 11.5% between FY08 and FY10, and has forecast an earnings per share of Rs 3.60 for FY09.

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Report for KS Oils

KS Oils
cmp: Rs 76
target price: Rs 117
he company would be the biggest beneficiary as the mustard oil market gets increasingly organised. KSO has embarked upon a capex programme of over Rs 650 crore to expand crushing/refining capacities by 3.5-4 times and solvent capacity by 6 times in the next two years.

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Friday, May 16, 2008

Some Good investment tips for an equity investor

Equity investment is a must have in one's portfolio if he is serious on accruing wealth. Lots of time time to research and good amount of patience required (read this article, the Requirement of patience by an investor) to an equity investor to succeed. Here are some best practices for investors who's serious on direct equity investment. For simplify, these practices divided to three, self assessment, fundamental research and profit analysis as well as some best practices:

Self assessment

1. What is your investment objective?

2. What is your perspective? Long term or short term? (To get profit from equity investment, one should have a long term perspective. It is advisable to have a 5 to 10 years time perspective for a successful investor to double his money or receive proper returns from his stock investments. Building wealth is not an hour, a day or some months process. It is a time taken process)

3. What is your risk profile? Can you bear a lose of 35 to 45% of capital in case of fluctuations and market volatility? If not, direct stock investment is not yours. You can go with debt instruments that is providing guarantee to capital but low returns.

4. What is you goal while investing in equities? It may be higher study, marriage of your daughter, buying a home, vehicle or even a holiday in later years.

5. Do you have enough knowledge about stock market, how it is working and its various cycles?

6. Are you starting your investment in early years? Ideally, subtract your age from 100 and the resulted percentage of your money should be in equity. If you are near to the pension age, it is not your choice but go for debt or secure investments like fixed deposits, debt funds etc.

Fundamental Research

While selecting a company to invest in their stock, you should acquire reasonable knowledge about the company, product, management, competitors, market status etc.. Below self assessment questionnaire help you to identify and decide whether the company is best to invest or not?

1. Are you better aware about the company? When did the company established and what is their history?

2. What are their businesses/services portfolio? Is that legal?

3. Is the product or services portfolio diversified well enough to confirm market status in case any produce or service failure occurred in future?

4. Is the company's business/service quality is enough to retain market trust for long term compare with similar product or services in the market?

5. Who are the main competitors?

6. How competitors product or service compare with? Is that better or less compare with?

7. How well the company management?

8. How innovative the company is, for product and services?

9. How many locations the company have factories or manufacturing units?

10. Do they have an international business and in that case do they have any facilities other than your country as well as how well their product movement in other markets?

11. What are their major profit source?

12. What is the share holding status? Do any foreign investments made on the company? Is there any reputed financial institutions/banks holding their shares?

13. How well the management completing the future plans declared in the company annual general meetings?

14. Do they have an investor friendly atmosphere?

15. Do they providing proper informations to investors about major activities as well as respecting their investors?

16. Is there any legal actions against the company or any pending cases against them?

17. In case of legal proceedings in the past, what are the reason and how company faced them?

18. do they have received any resistance or rejection from govt authorities in the past or present about any of their product or services?

20. Is there any labor issues within the company?

21. How the satisfactory level of staff those who working with company? This information you can receive by approaching those who are working with company. Always ask to 5 or more people.

As a most important factor, you should be well aware about companies business style and the network all over country and internationally.

Profit Analysis

To analyze the profit, you are required to collect informations from the companies or stock exchanges. This includes the Annual Report and financial reports for last few years (minimum 5 years). This will be available from various financial sites too.

1. What are the profit sources to an investor from the company in the past?

2. Are they a consistent dividend payer? (Check the dividend history for last 20 years and find out any failure occurred in any years withing this 20 years. A history of paying dividend continuously these 20 years, you can confirm that the company is a good dividend payer.)

3. What is the dividend percentage and is that increasing or decreasing year to year?

4. Does the company giving bonus issues to their investors?

5. What are the sales growth for last five years at least? Are they maintaining the sales growth consistency year to year?

6. What is the profit growth rate in an year to year? Are they maintaining the year to year profit consistency continuously? (If the company continuously have a minimum 25% growth in sales and net profit year to year, it can be a considerable point to buy the stock)

7. What is the Debt to Equity Ratio? This is a measure of the total debt a company owes compared to the equity of the shareholders. It tells you just how much of the capitalization is the owners vs. the creditors

8. What is the ROE (Return on Equity) ratio? This reveals how much profit a company earned in comparison to the total amount of shareholder equity on the balance sheet. For those of you interested in long-term investing with rich rewards, companies that have high return on equity ratios can provide the biggest payoff.

9. What are the Current Ratio? It serves as a test of a company's financial strength and relative efficiency

10. What is the Asset Turnover Ratio? The asset turnover financial ratio calculates the total sales for each dollar of asset a company owns. It measures a company's efficiency in using its assets.

11. What is the PBR (Price to Book value) Ratio? (A ratio used to compare a stock's market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter's book value per share. A lower P/B ratio could mean that the stock undervalued. However, it could also mean that something is fundamentally wrong with the company. As with most ratios, be aware that this varies by industry.)

An in depth details of all these ratios available here

As well as the above, find out the PE ratio (A valuation ratio of a company's current share price compared to its per-share earnings. This is calculating by dividing the Market Value per share with EPS (Earning per share). An Example: if a company is currently trading at $43 a share and earnings over the last 12 months were $1.95 per share, the P/E ratio for the stock would be 22.05 ($43/$1.95). Compare this ration with competitor companies will give you an exact idea about the stock is under values or over valued.

12. Wheather the EPS, Earning Per Share, of the company increasing and year to year basis?

There are more ratio analysis available for understand a companies growth and profit screening. As an ordinary investor with less financial background, you can research the above mentioned ratios and that will give you the required information about the company and the possibility of profit in a long term run.

Some Don't while investing in Equity

1. Don't believe the analysts and tips from public

2. Don't follow public

3. Market will fluctuate always. Required enough patience to have good profit in the future.

4. Buy when others are selling and sell when others are buying.

5. Don't over diversify. Have enough diversification between Large, mid and small cap companies as well as among multiple industries.

6. Don't buy small number for stocks to test. Once if you found a very good company, go an buy the maximum possible buy you.

7. Don't buy any stocks without doing proper research from all angles.

If possible, buy and read some very good books available in the market. For starters, "Buffet: Making of an American Capitalist" is a good buy. Peter Lynch's "Once upon the Wall Street" will give you good ideas that an investor must have. Read my article "One up on wall street by Peter Lynch - The investors best friend" to have a look on what he said in this best seller.

Have better idea about Margin of Safety advice from Benjamin Graham. Read his Last will and Testament, a set of best available advices from Legend investor to investors those who investing in equities. The great book: Interpretation of Financial Statements from Benjamin Graham will be a very good guide for you to properly analyze the financial ratios.

Be a conscious and intelligent investor all the time.

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Thursday, May 15, 2008

How NRI Can Invest in India

Direct Investment

Foreign companies are now permitted to have a majority stake in their Indian affiliates except in a few restricted industries. In certain specific industries, foreigners can even have holding upto 100 percent.

Investment through Stock Exchanges

Foreign Institutional Investors (FIIs) upon registration with the Securities and Exchange Board of India (SEBI) and Reserve Bank of India (RBI) are allowed to operate on the Indian stock exchanges subject to the guidelines issued for the purpose by SEBI.

Important guidelines are as under :

Portfolio investment in primary or secondary market of a company by all registered FIIs, NRIs and OCBs is subject to a ceiling of 30/40 per cent of issued share capital. In any one company, holding by a single FII, NRI or OCB is subject to a ceiling of 10 percent of the total issued capital. However, in applying the ceiling of 30/40 percent the following are excluded:

Foreign investment under a financial collaboration which is permitted upto 51 percent in all priority areas.

Investment by FII's through offshore single/regional funds, GDR's and euro convertibles.

Disinvestment is allowed through a member broker of a Stock Exchange.

A registered FII is required to buy or sell securities on the Stock Exchanges only for delivery. It is not allowed to offset a deal in the same settlement. It is also not allowed to sell short, i.e., sell a security without having the stock in its portfolio.

Investment in Euro Issues/Mutual Funds floated overseas

Foreign investors can invest in Euro issues of Indian companies and in India-specific funds floated abroad.

Broking Business

Foreign brokers upon registration with the SEBI are now allowed to route the business of their registered FIIs clients through the members of Stock Exchanges. Guidelines for the purpose have been issued by SEBI.

Asset Management Companies / Merchant Banking

Foreign participation in Asset Management Companies and Merchant Banking Companies is permitted.

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Differance between PPF and NSC

When we carried an earlier piece on PF vs PPF: What's the difference?, we were flooded with mails telling us to do a piece on PPF vs NSC.
This is what we attempt to do here. Explain the difference between the Public Provident Fund and the National Savings Certificate.
The NSC is a post-office savings scheme while the PPF was established by the central government in 1968. But both are very safe since they are backed by the government.
How much goes in?
The minimum amount you have to put into your PPF account in a year is Rs 500. The maximum you can put is Rs 70,000 per year.
With NSC, the minimum amount is Rs 100. Here, is no upper limit on investment.
However, NSC is sold in denominations of Rs 100, Rs 500, Rs 1,000, Rs 5,000 and Rs 10,000. So, if you want to invest Rs 30,000, you will have to buy three certificates of Rs 10,000 each.
What do I get?
On the face of it, both give an identical rate of interest: 8% per annum. Or so it seems.
The only difference is in the way it is computed. PPF is compounded annually. NSC is compounded half-yearly (twice a year).
Let's say on April 1, 2006, you invested Rs 30,000 in PPF and the same amount in NSC.
On April 1, 2007, your PPF account will have Rs 32,400 while your NSC will have Rs 32,448.
What's the tax impact?
The most important issue!
Both these investments fall under Section 80C. That means the investments made under this section are eligible for an income deduction upto a maximum Rs 1,00,000.
This is as far as your principal investment goes.
Let's look at the interest earned.
With PPF, you pay no tax on the interest you earn.
What about NSC?

Till FY 2004-'05, an individual could avail of a deduction under Section 80L of the Income Tax Act. This limit was Rs 12,000 of interest income received during the financial year.

This deduction has been done away with from FY 2005-'06. Now, all interest income is taxable at the respective slab rate of the individual.
The interest accrued on NSC is taxable. But, it is also eligible for a deduction under Section 80C.
Generally, it is advisable to declare accrued interest on NSC on a yearly basis. So, over the period of six years, you could declare the interest income for each year. In such a case, it does not amount to a huge sum.
If you do not declare the interest on accrual basis, then the entire interest earned (difference between the amount deposited and the maturity value) would accumulate in the year of maturity. You could then claim it under Section 80C but it would be a huge amount and would be taxable at the current applicable tax rate.
How long do I hold it?
PPF is for 15 years, but you can extend it for a block of five years. Let's say you open a PPF account when you are 21 years old. It matures when you are in your late 30s, when you may be earning well and may not need the money. In that case, you can continue with the account.
Of course, you do have the option of withdrawing the entire balance on maturity, that is, after 15 years of the close of the financial year in which you opened the account.
So, if you opened it in FY 2006-07 (this financial year), you will be able to withdraw it 15 years later, starting March 31, 2007 (end of this financial year). That is April 1, 2022.
If you extend it for five years after that, you continue to earn the rate of interest and can also make fresh deposits and get the tax benefit.
NSC is for a much shorter duration -- just six years from the date of investment.
How many can I have?
Once you open an NSC, you can't keep adding to it. You will have to buy another. Let's say you buy a NSC of Rs 30,000. In a year's time, you want to add another Rs 30,000. You cannot add it to this amount. You will have to buy another NSC.
With PPF, you can have just one account. But this does not matter because you have to make annual additions. Every year, you keep adding to it.
However, if you like the safety of the investment and a guaranteed return of 8% per annum, you can open one in your child's name.

So you can have one account for yourself and one for your child. But this does not mean the tax benefit is doubled. The limit is the same -- Rs 70,000, irrespective if it all goes in your account or in your account and your child's.
Let's say you open an account for your minor child. You can deposit Rs 70,000 in your account and Rs 70,000 in your child's account. But you will only get the tax benefit on Rs 70,000.
How is it held?
The PPF account cannot be held jointly. You can nominate someone but it cannot be jointly held with someone else.

With NSC, you can hold it jointly or you can hold it singly and nominate someone.
Where can I open it?
To open a PPF account, you can drop by a State Bank of India branch. No, you do not have to have an account with them.
You can also ask your nationalised bank where you have an account if they are authorised to open PPF accounts. You can also approach the head post office in your area. If that is inconvenient, ask your local post office (selection grade sub post offices are allowed to do so).
To buy an NSC, just approach any post office.
Resource - www.Rediffmail.com

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Results of Chennai Petroleum Q4

Chennai Petroleum is to announce its Q4 and FY08 numbers. According to CNBC-TV18 estimates, the company is expected to post 6.6% growth in its net profit of Rs 201.65 crore as against Rs 189.10 crore in same quarter of last year. Net sales is seen up 37.7% to Rs 7785 crore from Rs 5653.1 crore YoY.

FY08 net sales is likely to go up 12.1% to Rs 27624.2 crore from Rs 24653.3 crore and net profit seen up 73% to Rs 980.65 crore from Rs 565.3 crore.

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Results of PNB for Q4

Punjab National Bank has announced its FY08 numbers. The bank has reported Q4 net profit of Rs 544 crore versus Rs 237.7 crore, a growth of 128.86% and net interest income of Rs 1,517 crore versus Rs 1,423 crore, up by 6.6%.Q4 other income stood at Rs 537.21 crore. NIM was at 3.66% and CAR at 12.96%.FY08 net profit went up at Rs 2,048 crore from Rs 1,540 crore.

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Tuesday, May 13, 2008

How does transfer of physical shares take place?

After a sale, the share certificate along with a proper transfer deed duly stamped and complete in all respects is sent to the company for transfer in the name of the buyer. Once the transfer is registered in the share transfer register maintained by the company, the process of transfer is complete.

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Who has to replace the shares in case of company objections?

The member who has sold the shares first on the Exchange is responsible for replacing the shares within 21 days of the Exchange being informed. Company objection cases that are not rectified or replaced are normally auctioned.

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What should one do with company objections?

The broker must immediately be notified. Company objection cases should be reported within 12 months from the date of issue of the memo for the original quantity of share under objection.

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What are company objections?

A list documenting reasons by a company for not transferring a share in the name of an investor is called company objections. Rejection occurs due to a signature difference, or fake shares, or forgery, or if there is a court injunction preventing the transfer of the shares.

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What is bad delivery?

SEBI has formulated uniform guidelines for good and bad delivery of documents. Bad delivery may pertain to a transfer deed being torn, mutilated, overwritten, defaced, or if there are spelling mistakes in the name of the company or the transfer. Bad delivery exists only when shares are transferred physically. In "Demat" bad delivery does not exist.

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What happens if the shares are not bought in the auction?

If the shares are not bought at the auction i.e. if the shares are not offered for sale, the Exchange squares up the transaction as per SEBI guidelines. The transaction is squared up at the highest price from the relevant trading period till the auction day or at 20 per cent above the last available Closing price whichever is higher. The pay-in and pay-out of funds for auction square up is held along with the pay-out for the relevant auction.

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Is there a separate market for auctions?

The buy/sell auction for a capital market security is managed through the auction market. As opposed to the normal market where trade matching is an on-going process, the trade matching process for auction starts after the auction period is over.

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What is an auction?

An auction is conducted for those securities that members fail to deliver/short deliver during pay-in. Three factors primarily give rise to an auction: short deliveries, un-rectified bad deliveries, un-rectified company objections

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What is short selling?

Short selling is a legitimate trading strategy. It is a sale of a security that the seller does not own, or any sale that is completed by the delivery of a security borrowed by the seller. Short sellers take the risk that they will be able to buy the stock at a more favourable price than the price at which they "sold short."

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When does one deliver the shares and pay the money to broker?

As a seller, in order to ensure smooth settlement you should deliver the shares to your broker immediately after getting the contract note for sale but in any case before the pay-in day. Simliarly, as a buyer, one should pay immediately on the receipt of the contract note for purchase but in any case before the pay-in day.

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What is a rolling settlement?

The rolling settlement ensures that each day's trade is settled by keeping a fixed gap of a specified number of working days between a trade and its settlement. At present, this gap is five working days after the trading day. The waiting period is uniform for all trades.

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What is a settlement cycle?

The accounting period for the securities traded on the Exchange. On the NSE, the cycle begins on Wednesday and ends on the following Tuesday, and on the BSE the cycle commences on Monday and ends on Friday.
At the end of this period, the obligations of each broker are calculated and the brokers settle their respective obligations as per the rules, bye-laws and regulations of the Clearing Corporation.
If a transaction is entered on the first day of the settlement, the same will be settled on the eighth working day excluding the day of transaction. However, if the same is done on the last day of the settlement, it will be settled on the fourth working day excluding the day of transaction.

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What is a Buy Back?

As the name suggests, it is a process by which a company can buy back its shares from shareholders. A company may buy back its shares in various ways: from existing shareholders on a proportionate basis; through a tender offer from open market; through a book-building process; from the Stock Exchange; or from odd lot holders.
A company cannot buy back through negotiated deals on or off the Stock Exchange, through spot transactions or through any private arrangement. Clearing and Settlement

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What is an ex-date?

The first day of the no-delivery period is the ex-date. If there is any corporate benefits such as rights, bonus, dividend announced for which book closure/record date is fixed, the buyer of the shares on or after the ex-date will not be eligible for the benefits.

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What is an ex-dividend date?

The date on or after which a security begins trading without the dividend (cash or stock) included in the contract price.

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What is a no-delivery period?

Whenever a company announces a book closure or record date, the Exchange sets up a no-delivery (ND) period for that security. During this period only trading is permitted in the security. However, these trades are settled only after the no-delivery period is over. This is done to ensure that investor's entitlement for the corporate benefit is clearly determined.

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What is the difference between book closure and record date?

In case of a record date, the company does not close its register of security holders. Record date is the cut off date for determining the number of registered members who are eligible for the corporate benefits. In case of book closure, shares cannot be sold on an Exchange bearing a date on the transfer deed earlier than the book closure. This does not hold good for the record date.

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What is a book-closure/record date?

Book closure and record date help a company determine exactly the shareholders of a company as on a given date.

Book closure refers to the closing of register of the names or investors in the records of a company. Companies announce book closure dates from time to time. The benefits of dividends, bonus issues, rights issue accruing to investors whose name appears on the company's records as on a given date, is known as the record date.

An investor might purchase a share-cum-dividend, cum rights or cum bonus and may therefore expect to receive these benefits as the new shareholder. In order to receive this, the share has to be transferred in the investor's name, or he would stand deprived of the benefits. The buyer of such a share will be a loser. It is important for a buyer of a share to ensure that shares purchased at cum benefits prices are transferred before book-closure. It must be ensured that the price paid for the shares is ex-benefit and not cum benefit.

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What is a contract note?

A contract note describes the rate, date, time at which the trade was transacted and the brokerage rate. A contract note issued in the prescribed format establishes a legally enforceable relationship between the client and the member in respect of trades stated in the contract note. These are made in duplicate and the member and the client both keep a copy each. A client should receive the contract note within 24 hours of the executed trade. Corporate Benefits/Action

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Why does one need a broker?

As per SEBI (Securities and Exchange Board of India.) regulations, only registered members can operate in the stock market. One can trade by executing a deal only through a registered broker of a recognised Stock Exchange or through a SEBI-registered sub-broker.

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How does one execute an order?

Select a broker of your choice and enter into a broker-client agreement and fill in the client registration form. Place your order with your broker preferably in writing. Get a trade confirmation slip on the day the trade is executed and ask for the contract note at the end of the trade date.

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What is an Index?

An Index is a comprehensive measure of market trends, intended for investors who are concerned with general stock market price movements. An Index comprises stocks that have large liquidity and market capitalisation. Each stock is given a weightage in the Index equivalent to its market capitalisation. At the NSE, the capitalisation of NIFTY (fifty selected stocks) is taken as a base capitalisation, with the value set at 1000. Similarly, BSE Sensitive Index or Sensex comprises 30 selected stocks. The Index value compares the day's market capitalisation vis-a-vis base capitalisation and indicates how prices in general have moved over a period of time.

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How many Exchanges are there in India?

The Stock Exchange, Mumbai (BSE) and the National Stock Exchange (NSE) are the country's two leading Exchanges. There are 20 other regional Exchanges, connected via the Inter-Connected Stock Exchange (ICSE). The BSE and NSE allow nationwide trading via their VSAT systems.

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What is electronic trading?

Electronic trading eliminates the need for physical trading floors. Brokers can trade from their offices, using fully automated screen-based processes. Their workstations are connected to a Stock Exchange's central computer via satellite using Very Small Aperture Terminus (VSATs). The orders placed by brokers reach the Exchange's central computer and are matched electronically.

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What is a Stock Exchange?

A common platform where buyers and sellers come together to transact in stocks and shares. It may be a physical entity where brokers trade on a physical trading floor via an "open outcry" system or a virtual environment.

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Market Basics Knowledge

What is a Stock Exchange?
How many Exchanges are there in India?
What is an Index?
How does one execute an order?
Why does one need a broker?
What is a contract note?
What is a book-closure/record date?
What is the difference between book closure and record date?
What is a no-delivery period?
What is an ex-dividend date?
What is an ex-date?
What is a Buy Back?
What is a settlement cycle?
What is a rolling settlement?
What is short selling?
What is an auction?
Is there a separate market for auctions?
What happens if the shares are not bought in the auction?
What is bad delivery?
What are company objections?
What should one do with company objections?
Who has to replace the shares in case of company objections?
How does transfer of physical shares take place?

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