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 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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