Sharekhan - BUY - Jaiprakash Associates

Sharekhan has put a BUY on Jaiprakash Associates with a target of 240.

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Further Losses Likely

After an initial pull-back to 2084, the Nifty exhibited weakness. The index encountered stiff resistance around the 2077 level, which is the 50% retracement level of its decline from 2183 to 1971. In the near-term the Nifty could decline to 2000-1970. In the short-term the index has a support at 2014. If the 2014 support holds, the Nifty could see a bounce to its short-term averages around 2062-2066. A break below 2014 will see the weakness continue and the Nifty could test lower levels. IPCL could test the Rs166-163 range and on the upside the stock faces a resistance at Rs175. SBI is range-bound between Rs675 and Rs636. Shipping Corporation could test its previous bottom at Rs147. A break below Rs147 is likely to see further weakness in the stock. Reliance Industries is in the Rs575-540 range and the stock could exhibit weakness and test Rs540.

Source: Sharekhan Research

Indian Broadband prefers masses to classes

Subscribers of telephones from Mumbai's landline telephone provider Mahanagar Telephone Nigam Limited (MTNL) got a pleasant surprise some weeks ago in the form of a little note along with the traditional New Year greetings message.

The note welcomed subscribers to the broadband age and talked of how MTNL plans to roll out 1500000 broadband connections in Mumbai by end March 2005. Delhi subscribers of MTNL received a similar note, as did subscribers of BSNL in 100 BSNL cities across the country.

Getting the show on the road

In the middle of 2004, an IBEF analysis had reported that a broadband revolution was at the tip-off point in India. Now, the show has hit the road.

Public sector giants such as MTNL and Bharat Sanchar Nigam Limited (BSNL) have stepped on gas and are working out plans to wire up India with high-speed internet access through speeds ranging from 512 KBPS to 2 MBPS. Both MTNL and BSNL have imported broadband equipment and are working round the clock to fulfill their New Year promise.

Not to be left behind, private sector players like Tata, Bharti and Reliance have also joined the race and in some cities, and have already begun offering broadband connections.

The latest Economic Survey of the government of India predicts that India would have three million broadband subscribers by 2005-end. Another estimate expects India to ring in 20 million broadband users by 2009.

Broadband is high on the government's agenda for strategic reasons. To begin with, unlike over countries, where it is used more to tap middle class and high end customers, the government here wants broadband to be made affordable for the masses.

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