Market Close: Eventful week gives a cautious start..

No clear direction as markets traded volatile looking at global markets. SEBI is said to meet FII's today for P note investments and as well the UPA and Left meet also scheduled today which saw Investors to trade bit cautious. This week is the FNO expiry which also added to the volatility. Banking, FMCG and engineering counters traded in green. However, Realty, metals and Auto index failed to attract buyers. Rupee depreciation against the Dollar which failed to support the technology stocks. Small caps and Mid caps which were out of interest last week were in demand today and out performed the index heavy weights. Stock specific movement was seen on the back of good results. Global markets traded weak as US slipped over 300 points down in its previous session. Europe trading in red Asian Indices also ended in red.

Market has some major events scheduled for the week. Today UPA and Left meet was scheduled any negatives could hammer the markets which already got slammed. SEBI to meet for the P-Notes discussion on October 25 2007 followed by F&O expiry on the same day. RBI is scheduled to meet on 30th October 2007 for the Credit Policy. And finaly the US Federal Reserve is set to meet on October 31, 2007. Either, one these events could move the direction of the market. Lets hope good happens now..

Sensex closed higher by 54 points at 17613.99. It was helped up by gains in HDFC (2572.55,+7 percent), Guj Ambuja (145.35,+4 percent), ICICI Bk (1062.35,+4 percent), Rel Energy (1370,+3 percent) and ACC (1018.2,+3 percent). Restricting the gains were Bharti Tele (927.65,-4 percent), TCS (1074.4,-3 percent), Satyam (448.45,-3 percent), RIL (2412.75,-2 percent) and Maruti (1053.8,-2 percent).

Greenply Ind a company which is into manufacturing of Plywood, Laminates, Veneer and Particle board. Plywood contributed 51% of the revenue while laminates 49%. This industry is dominated by unorganised sector but dynamics seems to be changing now. However, the strong brand that the company has is the most powerful investment rationale in favor of the company. That would also be the company's edge over the unorganized segment of the industry. Normally demand picks up with a lag of 18 months to housing demand. This is the experience shared by the Greenply Management and seems logical as interiors get done up once the housing picks up. There was some slow down in the demand now. But, the long term story remains intact. The valuations are on the higher side and one can wait before taking any position now. We had a wow call on the company that was booked partially with good profits as well. We would update you with the results Analysis. Greenply ended up by 4% ahead of results.

Shanthi Gears Ltd (Shanthi) reported good results for the Q2 FY2007. The top line grew by 26% to Rs 59 cr from Rs 47 cr. The bottom line grew by 52% to Rs 10 cr from Rs 7 cr on yoy basis. The EBDITA grew by 33% to Rs 23 cr from Rs 18 cr, while the EBIDTA margins jumped by 300% bps to 40% on yoy basis. Improved efficiency and better economies of scale fueled the company to improve margins. In raw materials, 54% accounts for steel rods and steel forgings, 24% for foundry and rest 22% for bearings. Because of backward integration company is able to enjoy higher margins compared to its peers. Valuation seems to be attractive at the current market price of Rs 74 the stock trades at 15 times of trailing earnings. Compared to the peers like Elecon Eng, Shanthi is well placed to capitalise the opportunities. Future seems to be bright as the industry boom is expected to continue and the capex in steel, cement and power will boost the revenues of the company. The main raw material is steel; increase in prices will have impact the margins. Shanthi's business is directly dependent on industrial activity, it tends to be cyclical. Any slow down in the growth of the economy will have a major impact on a company's revenues. We will update you more here.

Technically Speaking: Sensex swung over 500 points from days low as it made an intra day high of 17,705 and low of 17,320. Advacnes marginally outnumbered Declines for the day. There were 1,341 advances against 1,314 declines. Sensex support lies at 17400 and 17150 levels. Resistance levels are at 17700 and 17930 levels.