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Friday, January 04, 2008
Reliance Power IPO Part Payment Details
Part Payment Details
a) Only Retail Individual Bidders and Non-Institutional Bidders are eligible for this method. QIBs cannot submit a Bid under this Payment Method.
b) While bidding, the Bidder shall make a payment of Rs. 115.0 per Equity Share, irrespective of the Bid Price. Investors should note that the total Bid Amount will be used to determine whether a Bid is in the Retail Individual category, Non-Institutional category or not, and not the amount payable on submission of Bid-Cum-Application Form.
c) Under Payment Method-1, of the Rs. 115.0 paid while bidding, Rs. 2.5 would be adjusted towards face value of the Equity Shares and Rs. 112.5 shall be towards share premium of the Equity Shares applied for.
d) At the time of allotment:
1. If the amount paid by the Bidder is equal to or higher than the total amount payable (being the Issue Price multiplied by the number of shares allotted, net of Retail Discount) by the Bidder on the Equity Shares allotted to the Bidder, we reserve the right to adjust the excess amount towards the Balance Amount Payable and issue fully paid Equity Shares only. The excess amount, if any, after adjusting the Balance Amount Payable shall be refunded to the Bidder (i.e., Refund = Total amount paid on bidding minus the total amount payable on the shares allotted).
2. If the amount paid by the Bidder is less than the total amount payable by the Bidder (being the Issue Price multiplied by the number of shares allotted, net of Retail Discount) on the Equity Shares allotted to the Bidder, we reserve the right to adjust the excess of the amount received from the Bidder over the Amount Payable on Submission of Bid-cum-Application Form towards the Balance Amount Payable and issue a Call Notice for the balance.
3. The notice of the Balance Amount Payable will also be published in two widely circulated newspapers (one each in English and Hindi) and a regional newspaper along with the statutory advertisement for the Basis for Allotment.
e) Equity Shares in respect of which the Balance Amount Payable remains unpaid may be forfeited, at any time after the Due Date for Balance Amount Payable.
Reliance Power IPO Allotment, Listing
Reliance Power allotment is likely to be completed in the last week of January 2008
Reliance Power is likely to be listed by the first week of February 2008
Karvy is the registrar for the issue
Here is the Red Herring Document ( 4 MB) - Right Click and SAVE
Rakesh Jhunjhunwala Picks for 2008 ?
Rakesh Jhunjhuwala Picks ? Ramesh Damani Picks ?
Who are they ? Our own readers have their picks !
If you haven't given us your picks... Hurry up!
The Stock Picks of 2008, see what the readers want you to buy !
Reliance Power IPO
With so much of hype on Reliance Power. We are sure everyone would want to apply for the issue
If one gets an option for Part Payment, almost everyone would apply for 1L
Across messageboards, people are preparing to apply in 4,5,6 demat accounts.
There is a decent issue in Future Capital Holdings which actually has a business, do check that out as well
Analysts Meet Free Listing
For the benefit of the PR and the companies, we will posting FREE PR Listings on this site.
Take advantage of this opportunity and invite the best analysts and journalists right here!
Read more here
Weekly Close: Is 20k here to stay??
Week started ranged with New Year eve with less participation but midcaps and small caps had their charms but heavy weights traded sluggish at the start of the week. Party mood in the initial 2 days kept the trading activity muted and that limited the support from the Global front as well. Third day of the week saw indices end in red as global market also witnessed profit booking as crude touched $100 per barrel which weighed across but Indian oil companies rallied. Oil marketing companies rejoiced as Oil ministry declared to hike price of Petrol by 4 Rs and Diesel by Rs 2. Adding to this was Gold which also touched it?s all time high of $879 an ounce. Indian Power stocks also rallied with the largest IPO in the history of Indian Capital Markets by Reliance Power Ltd. As mentioned Mid Caps and Small caps have outperformed this week too. Market rallied on the last day of the week with over 300 points with optimism across, oil and power stocks are the winners for the week. Next week we enter the results season which will decide the market direction.
US markets had weak trade so far with economic data was somewhat positive offsetting the worries of recession a bit. US markets have sustained at below 200 DMA and that clearly is a confirmation that life will be tough for them. Global cues are something to worry about.
Sensex gained 2.14% for the week and Nifty gained 3% for the week. Sensex was supported by REL +15.99%, NTPC +12.05%, Ongc +9.23%, Tata motors +7.26%, HDFC +7.05%, ITC +6.74%, Hind Unilver +5.81%, DLF +5%, ICICI Bank +4.23%, Rcom +3.77% while Sensex was dragged by Wipro -6.80%, TCS -6.58%, Satyam -5.69%, Infosys -5.61%, Ambuja cement -3.75%.
old-Tek Technologies Limited (Mold Tek) is one of the leaders in packaging and an emerging player in the Structural Engineering KPO Services. Though the revenue from the IT business is less but there has been continuous growth and its KPO part would be one of the multi bagger in next few years. The company has been able to maintain similar profit margins despite rupee appreciation as higher productivity came into play. It managed to achieve almost 90% growth in sales and net profit for its KPO Division in a challenging US environment. The company is also in the process of demerging its KPO business from its Plastic packaging business by April?08. The de-merger would result in better focused business and valuations. The demerger would unlock value as well. The stock hit its all time high today and has just started to deliver. Do read the detailed note on our site.
Karuturi. Com is the largest manufacturer of flowers post the Kenyan acquisition. The numbers would flow in top line and bottom line from this quarter. Flowers is really localised and fragmented business. But, Karuturi has really done great job and is now a global company. We tracked the stock 2 years back and the stock has delivered exceptionally well. Our note in the site should give you good idea about the company.
Adhunik supplies specialized steel & value added steel components to industries such as Automobiles, Power, Defence and Engg companies. Adhunik Metaliks was on lime light for the week after the news that expansion plan is getting completed in next quarter itself and from next quarter Adhunik will have 4.5-lakh tonne capacity available. As far as power is concerned 17 MW is running and another 17 MW is coming by next quarter itself so combining will fiche about 34 mega watt of captive power plant in the steel business. The valuation looks attractive considering its transformation to a fully integrated steel player. We believe primarily growth will be driven by higher realization as a result of rolled products ( rolled from outside rolling companies, as its own rolling mill is likely to come in FY08). We had a Wow call here which was booked after it delivered gains of more than 15% in a week.
Paramount Communication (Paramount) is one of the leading manufacturers of Power Cables, Railway Cables and Telecom Cables. It supplies large variety of specialized cables and wires for diversified range of industries. Paramount is expanding the capacity in three phases with an investment of Rs 120 cr. Paramount recently acquired, a company called AEI cables in UK which is one of the oldest cables manufacturing company with a good reputation. This company has major presence in UK and presence in the industrial and construction cables; also has comparable presence in Defense and Railways. Valuations are certainly attractive. The company is growing organically and inorganically. The future seems to be promising; the capacities are coming at the right time. The recent acquisition should give a big jump to the top line but margins are where the risk lies. The margins of the UK unit may take its time and the valuation would be thus dependent on this turnaround. The turnaround of the acquired entity will be a major trigger for Paramount. We are positive on the business and Paramount?s prospects. One can accumulate at dips for long term investment prospect.
Sensex traded well above the 20k for the entire week. Bullishness was seen across the sectors. Recently the Pharma and FMCG stocks have picked up and fresh money seems to ge getting into these stocks. These are defensive stocks and hence what we can derive is money is that big money is moving into safer sectors. Traders should trade with caution in midcaps and small cap stocks which have risen very smartly for a last few weeks. Sensex resistance is seen at 20750--20950. Fresh bullishness will trigger in if this range is crossed and we might move upto 22000. On the lower side, Sensex has support at 20k and 19500
Sensex garners 480 points
The market edged higher, last week, to hit record high in anticipation of good Q3 December 2007 results. The BSE Mid-Cap and Small-Cap indices spurted.
The 30-share BSE Sensex rose 479.94 points or 2.38% to 20,686.89, a record closing high, in the week ended 4 January 2008. The S&P CNX Nifty gained 135.70 points or 2.21% to 6274.30, a record closing high, in the week.
The BSE Small-Cap index surged 982.82 points or 7.62% to 13,884.11 in the week. The BSE Mid-Cap index rose 538.49 points or 5.62% to 10,113.06 in the week.
The market posted modest gains on 31 December 2007, led by gain in telecom stocks and in select heavyweights. The 30-share BSE Sensex rose 80.04 points or 0.40% to 20,286.99. The broader CNX S&P Nifty rose 58.90 points or 0.97% to 6,138.60.
The market posted marginal gains on 1 January 2008. Trading for the day began on a firm note. The market slipped into negative zone in mid-afternoon trade before recovering from lower level later. The 30-share BSE Sensex rose 13.72 points or 0.07% to 20,300.71. The broader CNX S&P Nifty gained 5.75 points or 0.09% to 6,144.35.
The market recovered from lower level in highly volatile trade to end at higher level on 2 January 2008. The 30-share BSE Sensex surged 164.59 points or 0.81% to settle at record closing peak of 20,465.30. The broader CNX S&P Nifty was up 35.05 points or 0.57% at 6179.40.
The market edged lower on 3 January 2008, dragged by decline in IT, cement stocks and fall in select index heavyweights. The 30-share BSE Sensex settled 120.10 points or 0.59% lower at 20,345.20. Nifty declined marginally by 0.85 points or 0.01% to 6178.55.
The 30-share BSE Sensex surged 341.69 points or 1.68% at 20,686.89, on 4 January 2007. The broader CNX S&P Nifty rose 95.75 points or 1.55% at 6274.30. Sensex, Nifty, BSE Mid-Cap and BSE Small-Cap indices struck all-time highs.
India's largest private sector firm by market capitalization & oil refiner Reliance Industries advanced 3.02% to Rs 2985.85 in the week.
India's largest private sector bank in terms of net profit ICICI Bank rose 4.75% to Rs 1285.35.
India's largest power generation company in terms of net profit, National Thermal Power Corporation surged 12.57% to Rs 271.75 in the week.
India's largest private sector power utility company in terms of net profit, Reliance Energy (REL) surged 16.47% to Rs 2510.35. Reliance Power (RPL), in which REL holds 50% stake, plans to raise as much as $3 billion in the nation's biggest initial public offering. Reliance Power will sell 26 crore shares at a price band of Rs 405 to Rs 450 per share.
Housing Development Finance Company, India's largest dedicated housing finance company in terms of operating income, rose 6.41% to Rs 3111.30. HDFC agreed to sell 7.15% stake in its life insurance joint venture - HDFC Standard Life Insurance Company - to its foreign partner, Standard Life (Mauritius Holdings), for about Rs 201 crore.
India's largest cigarette manufacturer in terms of sales, ITC jumped 6.84% to Rs 219.55. As per reports, ITC's subsidiary Fortune Park Hotels plans to invest around Rs 130 crore in three or four hotels in Bangalore, Coimbatore and Kolkata.
Bharti Airtel, India's largest cellular services provider in terms of market capitalisation rose 0.80% to Rs 948.25.
Infosys Technologies, the nation's second biggest software exporter in terms of net profit, declined 5.62% to Rs 1694.80 in the week. Infosys will be one of the first among India's big companies to report Q3 December 2007 earnings on 11 January 2008.
India's second largest real estate firm by market capitalization Unitech spurted 7.66% to Rs 520.85 in the week on reports the company is making an aggressive entry into the booming realty market in the south. It is on the verge of announcing two joint development deals, involving over 1,400 acres of prime land in Hyderabad and Chennai.
India's top car maker by sales Maruti Suzuki India fell 2% to Rs 964.50 in the week after the company said it will raise prices of some vehicles by 2-3% in January 2008 because of higher raw material costs.
Anil Dhirubhai Ambani group firm Reliance Capital (RCL) soared 5.74% to Rs 2766.05 in the week. Earlier on 22 December 2007, some reports suggested that Reliance Capital's unlisted subsidiary Reliance Technology Ventures (RTVL) had invested in US-based telecom solution provider Stoke Inc. for an undisclosed sum. The US-based firm enables telecom operators to solve security services problems across different broadband access.
Burnpur Cement settled at Rs 46.35 on BSE, a premium of 286.25% over the fixed IPO price of Rs 12, on 3 January 2008. The stock debuted at Rs 18.45, a premium of 53.75% over the IPO price.
The Securities and Exchange Board of India on Wednesday, 2 January 2008 announced that institutional investors would be permitted to commence short-selling on the bourses from next month. Short-selling — in effect, selling shares without owning them — was banned in 2001 in the wake of the Ketan Parekh stock market scam. After a six-year gap, the Reserve Bank of India gave the go-ahead to foreign institutional investors (FIIs) earlier this week to enter into this mode of blank transactions on the bourses. And now it is the market regulator’s turn to permit short-selling by all institutional investors from 1 February 2008.
On 30 December 2007, the Finance Ministry ruled out raising interest subsidy beyond 2% for short term crop loans. Earlier, the minister of state for agriculture Kanti Lal Bhuria had said that his ministry was trying to ensure that farmers get short-term crop loans at 5%. Moreover, the Standing Committee on Finance observed that the 2%subsidy is inadequate, considering the requirements of the farming community.
On 30 December 2007, while addressing a press conference in Chandigarh the leader of opposition L K Advani stated that the Bharatiya Janata Party (BJP) was on a comeback trail. The minister added the BJP's victories in Gujarat and Himachal would change India's political scene.
Merchandise exports grew 26.82% to US$ 12.42 billion in November 2007 from US$ 9.79 billion in Noveber 2006. However, export growth was slower than a 35% increase in October 2007. Exports decelerated 22.08% in April-November 2007 over a 26.6% rise in in April-November 2006.
Inflation based on the wholesale price index (WPI) moved up to 3.50% for the week ended 22 December 2007, as compared with 3.45% in the week ended 15 December 2007, primarily due to the increase in prices of manufactured goods and fuel items
Market may extend gains
The market may extend gains on expectations of good Q3 December 2007 results. However, concerns over slower global growth and record high crude oil prices may cap gains. Inflow from foreign institutional investors (FIIs) hold key.
FIIs bought shares worth Rs 5579.10 crore in the month of December 2007. FIIs had sold shares worth Rs 5,849.90 crore in the month of November 2007. FII inflow in calendar year 2007 totaled Rs 71,486.50 crore as compared to Rs 36,539.70 crore in 2006.
Mutual funds were net buyers of shares worth Rs 3203 crore in the month of December 2007.
The 30-share BSE Sensex rose 479.94 points or 2.38% to 20,686.89, a record closing high, in the week ended 4 January 2008. The S&P CNX Nifty gained 135.70 points or 2.21% to 6274.30, a record closing high, in the week.
IT bellwether Infosys Technologies will announce results on 11 January 2008.
Small-cap and mid-cap stocks may continue their rally on momentum buying, as indicated by strong market breadth in the past few days. The BSE Small-Cap index surged 982.82 points or 7.62% to 13,884.11 in the week. The BSE Mid-Cap index rose 538.49 points or 5.62% to 10,113.06 in the week.
Of late, global markets have come under selling pressure on concerns that credit market crisis may intensify further. Any major sell-off there may cast its shadow here as well. The influential US non-farm payrolls data for December 2007 which is due on Friday, 4 January 2008, will set the tone for global markets.
Crude oil closed lower on Thursday, 3 January 2008 after hitting another record high of $100.09 earlier in the session. Light sweet crude for February delivery finished at $99.18, down 44 cents on the NYMEX.
Inflation based on the wholesale price index (WPI) moved up to 3.50% for the week ended 22 December 2007, as compared with 3.45% in the week ended 15 December 2007, primarily due to the increase in prices of manufactured goods and fuel items.
While addressing a press conference in Chandigarh leader of opposition L K Advani, on 30 December 2007, stated that the Bharatiya Janata Party (BJP) was on a comeback trail. Advani added BJP's victories in Gujarat and Himachal Pradesh assembly elections would change India's political scene.
Reliance Power discount for Retail investors
Retail investors will get a discount of Rs 20 per share on the issue price which will be decided through book building process. However, the public offer is only for 30 per cent of the issue.
Dish TV sells stake
Subhash Chandra's direct-to-home venture Dish TV has announced that it has sold 4.9% stake in the company to Indivision India Partners, a Mauritius-based private equity firm promoted by Kishore Biyani's Future Capital Holdings, for Rs 250 crore.
Dish TV will raise the money in two tranches. It will do a preferntial allotment of 12.5 million equity shares of Rs 1 each at a price of Rs 100 to raise Rs 125 crore. Indivision will also subscribe to 96,15,385 warrants, which will be converted into equity at Rs 130 a share, 18 months later.
The cash will be deployed to expand Dish TVs operations. "We intend to raise over Rs 1,000 crore in the next two years for our growth strategy," Arun Kapoor, CEO, Dish TV, told Business Standard recently.
Currently, the direct-to-home service provider has around 2.6 million subscribers — a market share of 67% of the 3.9 million subscribers in the market.
Kapoor said Dish TV aims to add over 1 million subscribers each year, and by March 2011, hopes to have around 8 million subscribers. As of now Dish TV has a presence in 4,300 towns and in the next two years it plans to operate in 1,500 to 2,000 more towns.
Via Business Standard
Manaksia IPO Listing
Will List On 8 January 2008
The company had fixed the issue price at the top end of the Rs 140-160 price band. At the IPO price of Rs 160, the PE multiple works out to 12.12, based on the year ended March 2007 annualised EPS of Rs 13.20.
See the Grey Market Premium by click on the GREY MARKET SEARCH label below
Sensex scales new peak
The Sensex rose to an all-time high led by gains in oil, capital goods, and banking stocks. The market resumed on a strong note despite mixed global cues, but investor’s strong appetite for heavyweights, power, banking, oil, and capital goods stocks saw the Sensex rally further. Strong participation from Reliance group companies also cheered investor sentiment. The Sensex breached the 20,700 level in the afternoon trades and held on its gains. Relentless buying thereafter in front-line stocks helped the index to touch the record high of 20,763 towards the close. However, the Sensex shed some gains at close to end the session at 20,687, up 342 points. The Nifty, too, touched its all-time high of 6,300 to close at 6,274, up 96 points.
Market breadth was neutral. Of the 2,922 stocks traded on the Bombay Stock Exchange (BSE) 1,485 stocks advanced, 1,415 stocks declined and 22 stocks ended unchanged. Except the BSE HC index, BSE IT index and the BSE Auto index, all sectoral indices ended in a positive territory. The BSE CG ended firm with gains of 2.56% at 20,029 while the BSE Oil & Gas index rose 2.31% at 13,917 and the BSE Bankex index added 2.01% at 11,905.
Action in several index heavyweights lifted the market. ICICI Bank led the pack and shot up by 4.67% at Rs1,285. L&T soared 4.50% at Rs4,244, HLL surged 3.77% at Rs231, Reliance Communication flared up by 3.63% at Rs760, Hindalco jumped by 3.41% at Rs220, ONGC added 2.90% at Rs1,344, Reliance Industries advanced by 2.86% at Rs2,986 and ITC moved up by 2.35% at Rs220. However, few index stocks came under sharp selling pressure. NTPC at Rs272, M&M at Rs823, Cipla at Rs213, Ambuja Cement at Rs144, TCS at Rs1,005, Tata Motors at Rs784, Maruti Suzuki at Rs964 and Infosys at Rs1,695 dropped over 1% each, while Satyam Computer and ACC dropped marginally.
Over 1.75 crore Centurion Bank of Punjab shares changed hands on the BSE followed by Burnpur Cement (30.06 crore shares), Hindustan Motors (26.57 crore shares), Tata Teleservices (19.53 crore shares) and RNRL (19.15 crore shares).
Valuewise, Reliance Petroleum registered a turnover of Rs431 crore on the BSE followed by RNRL (Rs398 crore), Reliance Industries (Rs272 crore), Centurion Bank of Punjab (Rs262 crore) and Reliance Energy (Rs248 crore).
Market pares gains in late trade
The market eased from higher level in late trade on profit booking, after a sharp intra-day surge. Index heavyweights, ICICI Bank, Reliance Industries (RIL) and Oil & Naural Gas Corporation edged higher. Realty major DLF advanced. BSE Sensex, NSE Nifty, BSE Mid-Cap and BSE Small-Cap indices struck all-time highs today.
The market breadth which was strong for a better part of the day, turned negative in late trade. Turnover on BSE was little under 11,000 crore. Asian markets were mostly in green. European markets were mixed.
The 30-share BSE Sensex was up 295.05 points or 1.45% to 20,640.26, as per provisional closing. Sensex hit all-time high of 20,762.80 in late trade. At day’s high, it gained 417.60 points for the day.
The broader CNX S&P Nifty was up 103.30 points or 1.35% to 6,261.85, as per provisional closing. It struck all-time high of 6,300.05 in late trade.
Inflation based on the wholesale price index (WPI) moved up to 3.50% for the week ended 22 December 2007, as compared with 3.45% in the week ended 15 December 2007, primarily due to the increase in prices of manufactured goods and fuel items.
The BSE Mid-Cap index was up 0.30% to 10,086.57 and the BSE Small-Cap index was down 0.33% to 13,851.29. Both these indices underperformed the Sensex. The BSE Mid-Cap index hit all-time high of 10,220.43 and the BSE Small-Cap index struck record high of 14,124.80 today.
BSE clocked a turnover of Rs 10,960 crore as compared to Rs 8235 crore by 14:30 IST.
The market breadth was negative on BSE with 1470 shares declining as compared to 1437 that advanced. 17 remained unchanged
Among the Sensex pack, 16 slipped while the rest of them advanced.
India’s largest private sector bank in terms of net profit ICICI Bank vaulted 4.15% to Rs 1279. It was the top gainer from Sensex pack.
However, State Bank of India (down 0.42% to Rs 2386), and HDFC Bank (down 0.08% to Rs 1696), slipped
Reliance Communications, India's second largest cellular services provider in terms of market capitalisation, surged 3.65% to Rs 760.20. 20.53 lakh shares were traded on the counter on BSE.
India's largest private sector engineering company in terms of outstanding order book, Larsen & Toubro surged 3.90% to Rs 4220.
Oil exploration stocks Oil & Natural Gas Corporation (up 2.61% to Rs 1340) and Cairn India (up 2.26% to Rs 260.60), gained as crude oil hovered near record high of $100 per barrel.
Tata Steel rose 0.25% Rs 929 after the company said it has signed a joint venture agreement with the Steel Authority of India for incorporation of a joint venture company, for coal mining activities in Jharkhand, India.
India’s largest private sector firm by market capitalization & oil refiner Reliance Industries (RIL) advanced 2.62% to Rs 2979, off session's high of Rs 3018. 9.09 lakh shares were traded on the counter on BSE. As per reports, RIL has emerged as the highest bidder for the Motipur sugar unit of Bihar State Sugar Corporation at a price of Rs 57 crore, marginally higher than the floor price of Rs 55.36 crore.
India’s largest power generation company in terms of sales, National Thermal Power Corporation lost 2.24% to Rs 270.50 on high volumes of 39.94 lakh shares.
Auto stocks slipped on profit booking. Mahindra & Mahindra (down 1.40% to Rs 824), Tata Motors (down 1.32% to Rs 783.80) and Maruti Suzuki India (down 1.13% to Rs 964) declined
IT pivotals stayed subdued in firm market. Infosys (down 1.05% to Rs 1695), TCS (down 0.88% to Rs 1009), Satyam Computers (down 0.57% to Rs 423.50) and Wipro (down 0.33% to Rs 493.90) edged lower.
European markets were trading mixed. United Kingdom’s FTSE 100 was up 0.67% to 6,523 whereas Germany’s DAX was down 0.09% to 7,901.54
Most of the Asian markets were in green. Singapore's Straits Times (up 1.20% at 3,437.79), South Korea's Seoul Composite (up 0.60% at 1,863.90), Hong Kong's Hang Seng (up 2.35% at 27,519.69) and Sanghai Composite (up 0.78% to 5,362.85), rose. However, Japan's Nikkei slumped 4.03% at 14,691.41 and Taiwan Weighted slipped 1.22% to 8,221.10.
Markets in the United States ended flat on Thursday, 3 January 2008. The Dow Jones industrial average was up 12.76 points, or 0.10%, at 13,056.72. The Standard & Poor's 500 Index was unchanged at 1,447.16. The Nasdaq Composite Index was down 6.95 points, or 0.27%, at 2,602.68.
As per provisional data, foreign institutional investors (FIIs) sold shares worth a net Rs 244.56 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 526.65 crore on Thursday, 3 January 2008.
FIIs were net sellers of Rs 907 crore in the futures & options (F&O) market on Thursday, 3 January 2008. They were net sellers of Rs 1,132 crore in stock futures, Rs 109 crore in index futures and Rs 25 crore in stock options. They were net buyers of Rs 359 crore in index options.
Crude oil for February delivery rose to $100.09 in intraday trading in New York yesterday, the highest since trading began.
Post Market Commentary
The Indian market closed on a strong note led by heavy buying across all the index heavyweights. The market opened firmly and keeps on marching forward throughout the trading session but pares some of its gains towards the end of the session. Most buying is seen from the CG, Metal, Bankex and Oil & Gas baskets. The Inflation based on the wholesale price index (WPI) rose to 3.50% for the week ended 22 December 2007 as compared to 3.45% in the week ended 15 December 2007. The BSE Sensex closed higher by 341.69 points at 20,686.39 and NSE Nifty closed up by 95.75 points at 6,274.30. The BSE Mid Cap index closed higher by 56.19 points at 10,113.06 while BSE Small Cap fell by 12.60 points to close at 13,884.11.
BSE Bankex index surged 234.58 points to close at 11,905.06. Scrips that gained are CentBOP (6.83%), ICICI bank (4.67%), Kotak bank (2.07%), Axis bank (2.03%) and Andhra bank (0.73%).
BSE Metal index increased by 299.34 points to close at 20,297.51. Scrips that advanced are Sterlite industries (5.12%), Hindalco (3.41%), Maharash Sea (2.41%), Hind Zinc (1.86%) and SAIL (1.26%).
BSE Capital Goods index rose by 499.04 points to close at 20,029.24 as Praj industries (6.22%), SKF India (4.35%), Jyothi Structures (5.27%), Areva (5.13%), L&T (4.50%) and BHEL (1.35%) closed higher.
BSE Realty index grew by 39.47 points to close at 13,285.29. Scrips that pushed up are Parsvnath (9.15%), Penland (3.52%), DLF (2.32%), Purvankara (1.92%), Ansal Infra (1.89%) and Omaxe (0.81%).
BSE Oil & Gas index advanced by 314.78 points to close at 13,917.04 as Aban Offshore (5.61%), RPL (5.32%), RNRL (3.21%), ONGC (2.90%), Reliance industries (2.86%) and Cairn India (2.51%).
BSE IT index dropped by 44.49 points to close at 4,319.14. Scrips that fell are Aptech (4.47%), NIIT Ltd (4.07%), TCS (1.27%), Infosys (1.06%) and Satyam (0.98%).
Grey Market - Future Capital , Reliance Power, Aries Agro
Future Capital Holdings 700 to 765 380 to 400
Reliance Power 405 to 450 400 to 420 (per 1L application - 9000 )
SVPCL 42 DISCOUNT
Aries Agro 130 20 to 25
Manaksia Ltd. 160 12 to 15
Porwal Autocomponents 75 DISCOUNT
Precision Pipes & Profiles 150 20 to 25
Alert - Burnpur Cement
For small retail investors, Please do not pick Burnpur Cement for delivery
Be careful, SEBI wakes up late, but its coming soon
Remember Nissan Copper ?
Market may decline on weak global cues
The market may edge lower tracking weak Asian markets, which were being battered by a stronger yen, higher oil prices and worries about the U.S. economy. With December 2007 quarterly results season around the corner, investors may stay on sidelines before taking fresh positions.
Asian markets were trading lower today, 4 January 2008. Japan's Nikkei (down 4.03% at 14,691.41), Singapore's Straits Times (down 0.13% at 3,392.68), South Korea's Seoul Composite (down 0.62% at 1,841.33) edged lower. However, Hong Kong's Hang Seng (up 0.51% at 27,025.54) and Sanghai Composite (up 0.60% to 5,352), rose
Markets in the United States ended flat on Thursday, 3 January 2008. The Dow Jones industrial average was up 12.76 points, or 0.10%, at 13,056.72. The Standard & Poor's 500 Index was unchanged at 1,447.16. The Nasdaq Composite Index was down 6.95 points, or 0.27%, at 2,602.68.
Back home, the 30-share BSE Sensex settled 120.10 points or 0.59% lower at 20,345.20, on Thursday 3 January 2008. Sensex had hit a record high of 20,529.48 in late trade on 2 January 2008. The S&P CNX Nifty declined marginally by 0.85 points or 0.01% to 6178.55 on Thursday 3 January 2008. It struck all-time high of 6230.15 in intra-day trade yesterday.
As per provisional data, foreign institutional investors (FIIs) sold shares worth a net Rs 244.56 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 526.65 crore on Thursday, 3 January 2008.
FIIs were net sellers of Rs 907 crore in the futures & options (F&O) market on Thursday, 3 January 2008. They were net sellers of Rs 1,132 crore in stock futures, Rs 109 crore in index futures and Rs 25 crore in stock options. They were net buyers of Rs 359 crore in index options.
Crude oil for February delivery rose to $100.09 in intraday trading in New York yesterday, the highest since trading began.
Pre Open Market Commentary
The Indian market on today is likely to have a positive opening as the US market closed mixed. Yesterday the market closed he session a negative territory after struggling a lot through out the trading session. The cues from the global markets are not in favor that led the domestic market to open a weak and the cautiousness prevailed in the market through out the session. The BSE Sensex closed lower by 120.10 points at 20,345.20 and NSE Nifty closed flat at 6,178.55. We expect that the market may look for cues to take direction during the trading session. Also, the declaration of inflation figures by the government will give some further direction to the market.
On Thursday the US market closed mixed. The Dow Jones Industrial Average (DJIA) closed marginally higher by 12.76 points at 13,056.72 while Nasdaq slipped by 6.95 points to close at 2,602.68 and S&P 500 index closed flat at 1,447.16
Indian ADRS closed mixed. In technology sector, Wipro grew by 0.62% while Patni Computers fell by (1.87%) along with Infosys by 1.22% and Satyam by (1.13%). In banking sector, HDFC bank and ICICI bank rose by (0.82%) and (0.56%%. MTNL increased by (2.41%) while VSNL dropped by (0.47%).
The major stock markets in Asia are trading weak. Japan''s Nikkei is trading lower by 616.37 points at 14,691.41 along with South Korea''s Seoul Composite trading down by 11.10 points at 1,841.33 while Hong Kong''s Hang Seng is trading higher by 138.26 points at 27,025.54.
The FIIs on Thursday stood as net seller both in equity as well as in debt. The gross equity purchased was Rs4,083.80 Crore and the gross debt purchased was Rs93.30 Crore while the gross equity sold stood at Rs4,328.30 Crore and gross debt sold stood at Rs182.90 Crore. Therefore, the net investment of equity reported was (Rs244.50) Crore and net debt was (Rs89.60Crore).
Today, Nifty has support at 6,081 and resistance at 6,257 and BSE Sensex has support at 20,594 and resistance at 20,046.
Caution should be exercised
The market is likely to remain volatile amid worries about the possible recession in US and mixed Asian markets in current trades. The presence of strong bullish sentiment may help the market to turn positive. However, the FIIs have turned net sellers of equities in the last session may weigh on the investor sentiment. The Nifty could test higher levels at 6,260 and may dip around 5,850, while the Sensex has a likely support at 19,500 and may face resistance at 21,000.
US indices finished marginally weak on Thursday as investors mulled a jump in factory orders, near record oil and gold prices. While the Dow Jones gained 13 points at 13,057, the Nasdaq dropped 7 points to close at 2,603 on weakness in tech stocks.
Few Indian ADRs closed with marginal gains on the US bourses. MTNL gained over 2% while Wipro, Tata Motors, ICICI Bank, HDFC Bank and Rediff gained over 1% each. However, Infosys, Satyam, Dr Reddy's Lab and VSNL shed around 1-2% each.
Crude oil prices moved down, with the Nymex light crude oil for February delivery slipped by 44 cents at $99.62 a barrel. In the commodity segment, the Comex gold for February series added $9.10 to settle at $869.10 a troy ounce.
US Market ends flat and mixed
Technology stocks drag down market and indices give up all of earlier gains
US Market ended flat but mixed today, Thursday, 03 January, 2008 ignoring a couple of better-than-expected economic reports. After staying in the green for almost entire day, stocks witnessed sell-off in the last hour of trading. Dow, still managed to eke out small gain at the end. Nasdaq ended in the red.
Crude prices continued to hover around the $100/barrel mark. Commodities rallied for the second straight day. Seven out of ten sectors managed to end in the green, the exceptions being Financials, Consumer Staples, and Consumer Discretionary.
The Dow Jones industrial Average ended the day with a gain of 12.76 points at 13,056.72. The Nasdaq Composite Index, finished lower by 6.95 points at 2,602.68. S&P 500 finished unchanged at 1,447.16.
Twenty out of thirty Dow stocks ended in the green today. Altria, United Technologies, CocoCola, AT&T and Pfizer were the top gainers. GM, Wal-Mart and American Express were the main Dow laggards.
Stocks today opened modestly higher following a better than expected private employment report. The ADP employment came in modestly better than expected, which gave the stock market a slight boost. The ADP said private employment grew 40K in December, compared to the expected 33K rise.
Also, the Department of Commerce reports that November factory orders rose by 1.5%. Market expected orders to rise by 1%.
But technology sector continued to play the spoilt sport today. And due to tech stocks, indices were dragged down in spite of some encouraging economic data.
Auto companies declare mixed December sales
In the automobile sector, Ford, Toyota and General Motors reported lower December sales. Chrysler and Honda Motor reported small gains. Ford and GM shares ended lower today.
Merck edged lower today after the drugmaker said it would pay as much as $702 million to Switzerland's Addex to license a potential schizophrenia treatment.
Indian ADRs ended mixed today. MTNL and Tata Motors ekded out some gains around 1%. Dr Reddys was the top loser shedding 2.5%.
Commodities rally for second consecutive day
Crude prices crossed the $100/barrel mark once again during intraday trading today, but gave up earlier gains and closed finally lower for the day. Crude oil fell after weekly inventory report by Energy Department showed that U.S. gasoline and diesel inventories rose as refineries increased operating rates. Today crude-oil futures for light sweet crude for February delivery closed at $99.12/barrel (lower by $0.50/barrel or 0.5 %) on the New York Mercantile Exchange.
Volume on the New York Stock Exchange topped 1.3 billion, while more than 1.9 billion shares traded on the Nasdaq. Declining stocks outpaced those advancing by roughly 8 to 7 on the NYSE, while decliners also ran ahead of advancers on the Nasdaq, by about 3 to 1.
Tomorrow will be another day when investors will focuss on the economic reports to set the tone of trading. December's unemployment and payroll data are due tomorrow before market opens. December's ISM Services Index will hit the wires just after market opens.
News Snippets - Jan 4 2008
News Snippets:
Ford selects Tata Motors as the preferred bidder for its Jaguar and Land Rover brands. (ET)
Carrefour to tie-up with Mukesh Ambani led Reliance group for its retail foray in India. (ET)
Tata Motors plans to assemble its small car in Thailand with an investment of Rs8-9bn. (ET)
Mahindra’s Logan to be cheaper by Rs30,000. (ET)
United Spirits buys distribution rights of Dalmore Single Malt in the US for US$58mn. (ET)
Honda Motorcycles and Scooters (HMSI) sales up 20% yoy in December 2007 to 71,098 units. (ET)
Satyam is looking at expansion in South America and USA and smaller cities in India. (ET)
Ashok Leyland has developed India’s first CNG engine for buses, employing multipoint fuel injection. (ET)
Reliance Industries and HPCL were among those that submitted financial bids for reviving sugar mills in Bihar. (ET)
Poor transport links in Bihar are likely to delay NTPC’s plans to expand generating capacity by 1,000MW at Kahalgaon. (Mint)
Reliance Power is evaluating plans to start manufacturing power generation equipment. (Mint)
The Delhi High Court said that any decision by the government to allocate GSM spectrum to Reliance Communications will be subject to its final order. (BL)
Hindustan Organic Chemicals is looking for a JV partner to expand its chemical manufacturing facility in Maharashtra. (BL)
Oil India to invest Rs45.75bn in exploration by end of 2009-10. (BL)
Soaring crude oil prices may compel IOC to sell Rs20bn oil bonds. (BL)
Indo Asian Fusegear to double switchgear capacity; expects revenues to rise by 40% in current fiscal. (BL)
GVK may commission Jegurupadu phase II and Gauthami power plants by middle of 2008. (BL)
Grasim Industries to foray into FMCG segment to operate in three categories; skin care, home care and baby care. (FE)
Reliance Retail enters into Rs1.4bn land deal in Bandra, Mumbai to set up its first Reliance Trends premium apparel store. (FE)
IOC proposes to revise its current exploration and production strategy (E&P) before bidding for E&P blocks under NELP VII. (FE)
ONGC shuts its unit near Mumbai leading to cut in gas supplies to power and Fertilizer plants. (FE)
RCF diversifies in to Rapid wall production. Intends to manufacture 1.4mn sq. mt of wall panels annually. (FE)
SBI raises the deposit rates by 25-175 basis points. (BS)
GDL to raise Rs3bn for rail freight subsidiary. (BS)
Govt has scrapped import duty and reduced customs duty on over 4,800 items to improve trade in South Asia. (ET)
The meeting of the GoM looking into the aviation policy remains inconclusive. (BL)
SEBI proposes listed companies to make only minimal incremental disclosure to issue debt instrument either public offer or private placement. (FE)
Government is mulling options, including a marginal increase in fuel prices to reduce under recoveries by PSU Oil firms. (FE)
TRAI recommends auction of mobile television spectrum and also proposes allowing up to 71% FDI in Mobile TV services.
Iron, Cement, Power units to get 92mt coal to ensure much needed long tern linkages. (BS)
Short Term Trading Calls
Buy Petronet LNG with stop loss of Rs 110 for a target of Rs 146.
Buy Power Grid Corporation with a stop loss of Rs 140 for short-term target of Rs 170.
Buy Neyveli Lignite with stop loss of Rs 240 for a target of Rs 325.
Morning Call - Jan 4 2008
Market Grape Wine :
In House :
Nifty at a supp of 6146 and 6095 with resis at 6217 and 6255.Can hold on to long position till NIFTY holds 6020
Intra Day: Buy Bajajhind above 293.60 with a TGT of 304 and a SL of 289
Buy DLF above 1101 with a TGT of 1130 and a SL of 1087
F&O: Buy Peninsulaland above 156 with a TGT of 168 and a SL of 151
Buy Relcap with SL
Out House :
Markets at a support of 20012 & 20134 levels with resistance at 20432 & 20591 levels .
Buy : RIL bullet
Buy : RNRL & REL
Buy : JpAsso & Jphydro bullet
Buy : Kotak Bank & YesBank
Buy : HdfcBank & IcicBnak
Buy : IBUllsreal & IBullsFin
Buy : EssarOil book profits at higher level
Buy : SBIN
Buy : Aban & RelCap
Dark Horse : RIL , JPAsso , REL , Jphydro , RNRL , IBullReal , BindalAgro & SBIN
Daily Technical Analysis- Jan 4 2008
Nifty — The index opened on a flat note and saw rangebound movement throughout the day’s trading. It ended the day with loss of 1 point.
Trading around 6185 — The index is trading around 6185 levels (high of 13 December 2007), a close above the 6185 level will see index exhibit further strength.Intra day index has support around 6126-6100 levels, intra day declines
should find support around these levels. On the upside resistance levels are 6230- 6270. Intra-day strength can be expected on index sustaining above 6185 levels.
Conclusion — Expect intra-day strength above 6185 levels.
Daily Trading Calls - Jan 4 2008
Nifty (6179) Sup 6097 Res 6229
Buy BPCL (542) SL 536 Tgt 553, 556
Buy Mah Seamless (626) SL 620 Tgt 638, 642
Buy Voltas (254) SL 250 Tgt 264, 266
Sell VSNL (718) SL 725 Tgt 704, 702
Sell Lupin (614) SL 620 Tgt 603, 601
Stream-line your portfolio
In the confrontation between the stream and the rock, the stream always wins, not through strength but by perseverance.
A number of otherwise rock solid stocks seem to be lackluster even as the market is touching new highs. So are the bulls running out of steam? For the day we expect the main indices to kick of the proceedings on a cautious note given the mixed global cues and uncertainty surrounding the US economy. But, things might just get better as the day wears on.
Keep an eye on what's happening in Asian and European markets for further direction. Side counters - many of them with dodgy background - may continue to dominate the large caps. Be highly alert at this stage, as this speculative buying binge cannot go on forever.
With Reliance Power IPO coming soon and market cap ‘war’ between the Ambani brothers is likely to intensify over the next few weeks. So, expect some heightened activities and possible news flow on the Reliance counters.
The Sensex was down 0.6% while the Nifty closed flat. Gains in Cairn, BPCL, Tata Power, Suzlon and RPL - which are not there in the Sensex - enabled the Nifty to avoid bigger losses. On the other hand, weakness in IT shares - owing to a weak dollar - hurt the Sensex. With the indices near all-time high levels, this kind of churning is only to be expected.
Auto, IT, Textiles and Cement sectors may lag behind due to sector-specific headwinds while Power, Oil & Gas, Infrastructure and Capital Goods shares will remain in the limelight.
Next week select auto stocks could gain as some announcements may be made at the Auto Expo. Select Banking, Pharma, Real Estate and Metal stocks could be looked at for investment purpose. This is for the medium to long term horizon.
NOCIL, which has been hitting upper circuits for the past several days, could see some softening. The company has clarified that NOCIL is not a part of Mukesh Ambani led Reliance Industries and NOCIL Petrochemicals is not a subsidiary of it. Therefore, the question of shareholders of NOCIL getting new shares of NOCIL Petrochemicals does not arise at all. The company further clarified that NOCIL does not own large tract of land in the Thane Belapur Industrial belt in Navi Mumbai as wrongly stated in a newspaper article, dated Dec. 24.
Vishal Retail's Board will meet on January 11, to consider and discuss raising of further capital through various available mechanisms in India. Adani Enterprise will consider fund-raising options in a Board meeting today. Ashapura Minechem will consider a preferential allotment. Dewan Housing Finance will mull fund-raising and enhancing FII investment limit.
Vishal Exports' Board has approved the proposal to demerge the 'Wind Farm Project' in Rajasthan and Tamilnadu, on a going concern basis, to Vishal Wind Project Ltd., Ahmedabad. Post the merger with Rain Calcining with itself, Rain Commodities has allotted 3,48,61,286 shares to the shareholders of Rain Calcining in the ratio of 2:7.
Alps Industries has set up a wholly owned subsidiary called Alps Energy to make investments in various energy projects. This will be the vehicle for the company’s investments in the energy sector. The company is currently negotiating with several parties for acquisition of allotted hydel power projects in Uttarakhand and Himachal Pradesh. In addition, the company is also making direct bids for projects yet to be allotted.
US shares closed virtually unchanged on Thursday as investors absorbed a positive report on factory orders, near record oil and gold prices and a stronger-than-expected reading on private sector employment ahead of Friday's government jobs report.
Retailers and carmakers declined on the back of the weak private job report and disappointing auto sales heightened concerns about consumer spending in the world's biggest economy.
Walgreen dropped after the largest US drugstore chain reported lower December sales than some analysts estimated. GM and Ford fell after sales slipped. Monster Worldwide, the largest provider of job listings, decreased after reporting a decline in its employment index for last month.
Market breadth was mixed. About two stocks fell for every one that rose on the New York Stock Exchange. On the Nasdaq, decliners topped advancers by over three to two on volume of 1.94 billion shares.
The S&P 500 was unchanged at 1,447.16. The Dow Jones Industrial Average added 13 points to 13,056.72. The Nasdaq Composite Index dropped 7 points or 0.3%, to 2,602.68.
Treasury prices rose, lowering the corresponding yields. The dollar fell versus the yen and euro. Oil prices briefly hit a record trading high above $100 a barrel before retreating. Gold prices closed at a new high.
Investors will also be reacting to the results from Thursday's Iowa caucuses, which kick off the 2008 presidential election. However, Wall Street's reaction is expected to be muted until the White House race intensifies further.
Stocks in Europe declined with cautious outlooks from British retailers Next and DSG International underscoring investor worries about economic growth amid record crude oil prices and continuing weakness in the housing sector. The pan-European Dow Jones Stoxx 600 index fell 0.3% to 358.94. The UK's FTSE 100 closed up 1% at 6,479.40, the German DAX 30 index shed 0.5% to 7,908.41 and the French CAC 40 index declined 0.1% to 5,546.08.
In the emerging markets, the Bovespa in Brazil was up 0.1% at 62,891 while the IPC index in Mexico rose 0.6% at 28,860. The ISE National-30 index in Turkey was down 2.4% at 67,546.
Asian markets were trading mixed this morning. The Nikkei in Tokyo was down 616 points at 14,691 and the Hang Seng in Hong Kong was up 256 points at 27,143. The Kospi in Seoul was down 12 points at 1840 and the Straits Times in Singapore added 7 points at 3403.
Bulls likely to bounce back
Weak global cues coupled with selling pressure in the index heavyweights dragged the benchmark Sensex lower in the opening trades. Though, bulls staged a come back led by the Oil & Gas majors, Power and PSU stocks, key indices were unable to hold on to their gains as further selling in even the Mid-Cap and the Small-Cap stocks and negative cues from the European markets dragged markets to end in red. Finally, 30-share Sensex closed at 20,345 slipping 120 points and Nifty ended flat at 6,178.
Asian Electronics gained 0.3% to Rs548 after the board of directors of the company approved raising Rs3bn. The scrip touched an intra-day high of Rs585 and a low of Rs541 and recorded volumes of over 1,00,000 shares on NSE.
Supreme Infrastructure slipped 0.5% to Rs181. The company announced that they secured Rs719.9mn order. The scrip touched an intra-day high of Rs194 and a low of Rs179 and has recorded volumes of over 2,00,000 shares on NSE.
ACC, India's biggest cement maker by capacity has slipped by 1.6% to Rs1005 after the company announced that its December sales declined 6% to 1.57mn tons from 1.67 million tons a year earlier. The scrip touched an intra-day high of Rs1028 and a low of Rs1001 and recorded volumes of over 1,00,000 shares on NSE.
Ambuja Cements was down 2% to Rs145. The company declared its sales rose 7% to 1.49mn tons from 1.39mn tons in the corresponding period a year earlier. The scrip touched an intra-day high of Rs148 and a low of Rs144 and recorded volumes of over 19,00,000 shares on NSE.
Jindal Steel gained 2% to Rs16,211 after the company announced that it secured Bolivia approval for TPA steel plant and would invest $2.1bn in mine, Steel plant. The scrip touched an intra-day high of Rs16,360 and a low of Rs15,660 and recorded volumes of over 1,00,000 shares on NSE.
Hero Honda raced ahead by 1.6% to Rs710. The company announced that sales in December fell 5% to 2,40,532 motorcycles and scooters compared with 2,52,462 units a year earlier. The scrip touched an intra-day high of Rs721 and a low of Rs688 and recorded volumes of over 7,00,000 shares on NSE.
MTNL was up 0.2% to Rs211 after reports stated that the company would get a nationwide license from the government to provide mobile services. The scrip touched an intra-day high of Rs217 and a low of Rs209 and recorded volumes of over 71,00,000 shares on NSE.
Burnpur Ltd., one of the large integrated private sector cement companies in the eastern region, started trading at Rs19 on the BSE against the issue price of Rs12. The scrip rallied by over 285% to close at Rs46. The scrip has touched an intra-day high of Rs49 and a low of Rs17 and recorded volumes of over 11,00,00,000 shares on BSE. The scrip topped second on the BSE turnover toppers’ list for the day.
The company came out with a Public Issue of 3,18,25,100 equity Shares of Rs10/- each. The price band was been fixed at Rs10 - 12 per share.
The company’s IPO was over subscribed by more than 15 times. The funds generated from the IPO would be used by the company for funding its expansion program. The company worked out Rs500crore expansion cum backward integration plan to be executed over a period of 2/3 years.
BGR Energy, supplier of systems and equipment for the power, oil & gas, refinery, petrochemical and process industries got listed at Rs801 on the BSE against the issue price of Rs480.
The scrip ended at Rs901 translating in to a premium of 87%. The scrip touched an intra-day high of Rs940 and a low of Rs801 and recorded volumes of over 43,00,000 shares on NSE.
The company entered the capital market with a public issue of 91.36 lakh shares of Rs10 each. It fixed the price band at Rs425 - 480 per share. The issue was subscribed 119.54 times.
What the FIIs are doing
FIIs were net sellers of Rs2.4bn (provisional) in the cash segment on Thursday while the local institutions pumped in Rs5.27bn.
In the F&O segment, foreign funds were net sellers of Rs9.08bn.
On Wednesday, FIIs were net sellers of Rs2.4bn in the cash segment.
Sasken Communications
We recommend a buy in Sasken Communication Technologies at current market price. From the weekly chart of Sasken Communication Technologies it is clearly evident that it had been on a long-term downtrend between June and November 2007 (from a high of Rs 584 to a low of Rs 250). However, the stock found support around Rs 250 in mid of November 2007, which is a historically key support level and began to trend up. During the course of this up-trend, the stock crossed over th We 21-day and 50-day moving average line and later penetrated a significant resistance level of Rs 305 during end of December 2007. We notice that volumes are rising for the past one week. The daily momentum indicator is featuring in the bullish zone and the weekly momentum indicator has recovered for the oversold region. The daily moving average convergence divergence is progressively rising in the positive region. The immediate support for the stock is at Rs 310 and the next support is at Rs 250 levels. The short-term investors can buy the stock with stop at Rs 310. We expect the stock rally up to the resistance level of Rs 395 in the short-term.
Via BL
FDI in Media to be increased
Issue to be discussed with the PM and FinMin before the budget
On 2 January 2008, Union Minister for Information and Broadcasting informed in an interactive session organised by the Indian Chamber of Commerce on the challenges and prospects of liberalisation in the media, that discussions are on about a further increase in foreign direct investment in the media.
Dasmunsi also informed that the issue would be discussed with the Prime Minister and the Finance Minister before the budget. He added that there was pressure from big media houses to relax the present 26% cap on foreign equity, but a sudden jump could not be made without due caution or without ensuring a level-playing field for smaller players.
Mukesh v Anil Ambani
In real life, the two Ambani brothers — Mukesh and Anil — may not be close to each other but in the roller-coaster, volatile world of the stock market which decides who is the richest, they are narrowing the gap between them rapidly. One witnessed the exciting pace between the two for the number one position in "riches" in 2007.
Mukesh became the richest Indian in India in 2007. But Anil was not very far behind. The total market cap of Mukesh’s companies — Reliance Industries, Reliance Petroleum, IPCL (which has now been merged) and Reliance Industrial Infrastructure Ltd — was Rs 1,93,980 crores, or $48.5 billion, as on December 11, 2007.
Anil’s wealth in terms of market capitalisation of his six listed companies was Rs 1,66,876 crores, or $41.7 billion, as on December 11, 2007. Since wealth here is calculated on the basis of their holdings in their companies it is interesting to see how their shares suddenly shot up almost in tandem in the middle of the year without any or little change in the fundamentals of their companies.
Stocks of the Mukesh stable went up like this: Reliance Industries scrip, which was Rs 1,284 on March 15, 2007, closed at Rs 2,818 on November 29, 2007, a growth of 120 per cent, Reliance Infrastructure from Rs 416 to Rs 1,886 in the same period, a rise of 260 per cent, and Reliance Petroleum Limited from Rs 69 to Rs 215, a rise of 213 per cent from March to November, though not a single litre of petrol was produced and the refinery is yet to come up.
Stocks of the Anil group went up as follows: Adlabs Films went from Rs 407 on March 15, 2007 to Rs 939 on November 29, a rise of 131 per cent, Reliance Capital from Rs 598 to Rs 2,278, a rise of 281 per cent, Reliance Communications from Rs 391 to Rs 665, a rise of 70 per cent, Reliance Energy from Rs 462 to Rs 1,664, a rise of 260 per cent, even though the company has not added a single megawatt of new power during the year, and RNRL from Rs 22 to Rs 153, a rise of 597 per cent on no ostensible development.
Where and how stock prices move is one of the huge mysteries of the stock market and the mystery is compounded because the way that the stocks have risen is reminiscent of the way stocks went up during 2002 and ended up in what is labelled as the Ketan Parekh scam. He had a few favourites stocks and they were even called the K-10 stocks. It was later discovered that Ketan Parekh was operating through participatory notes (PNotes) and stocks were pushed up through circular trading.
Analysts taken by surprise: Till the R stocks, as they are referred to, reached these heady heights, not a single analyst or brokerage house had given these stocks the targets that were achieved in reality. The question being asked is whether all analysts were wrong. Does research really have any value? Or is there something more to the R stocks going up?
For instance, in June, Merrill Lynch had given a target of Rs 1,807 for Reliance, a rise of eight per cent; Khandwala Securities a target price of Rs 2,120, or a rise of 27 per cent, when the price was ruling at Rs 1,674; Kotak Institution had given it a negative of 10 per cent, at Rs 1,525, when the stock price was Rs 1,698.
That all analysts can go wrong is not unheard off in these days of the subprime crisis. Not a single analyst or brokerage house, for instance, predicted such a crisis which had been making for a year. But, as some brokers say, the Ambanis are a different league altogether. If some C grade promoter’s stocks had gone up at such a scorching pace, they would have been caught for price manipulation. But in the case of the Ambanis it is very cleverly called "rerating" of stocks.
Financial institutions don’t book profits: Most of the trading in the Reliance stocks seem to have been done in the futures and options sector which is like a casino. According to brokers who track the market, with all this trading, there has been no change in the shareholding pattern of these companies. It should have been reflected in the shareholding pattern in the June and September quarters but there is no change.
What is interesting in this whole ramping up of the R shares is that the institutions have been hanging on to the scrip instead of booking profits.
Ketan Parekh scam: It is an uncanny coincidence that UTI did just this during the Ketan Parekh scam. When K10 stocks like Himachal Futuristic went up without any reason and with such exuberance, the institutions did not sell but clung on to them.
The result was that when the scam blew up, UTI was left with worthless pieces of paper of stocks like DSQ, Pentamedia, Global Tele etc.
In the case of R stocks, too, financial institutions do not seem to be booking profits and continue, according to information provided to the stock exchange, to hold the same number of shares.
Olga Tellis
Via Asian Age
Free Job Listing & PR Listing
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Some of them maybe looking out for job or looking out for information on the latest Analyst meets
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Please forward this to your Human Resources and let them take advantage of this platform. I'm sure they will thank you for this and take you out for a coffee atleast ;-)
Selling your Reliance Power IPO Application ?
Current Rates in the Grey Market are Rs 7500 for every application of Rs 1 lakh.
Current Grey Market Premium is around 380
Want to sell ? You have to be in the heart of the grey market trades at Ahmedabad :-)
Tata Motors, Cement Sector
Tata Motors
Cluster: Apple Green
Recommendation: Hold
Price target: Rs792
Current market price: Rs790
December sales decline by 2%
Key points
- Tata Motors' sales for December 2007 stood at 47,678 vehicles. Total sales declined by 2.2% year on year (yoy) and grew by 1.6% month on month (mom).
- Commercial vehicle (CV) sales in the domestic market for the month grew by 6.6% to 28,661 vehicles. Light commercial vehicle (LCV) segment continued to exhibit strong growth of 19% yoy. Medium and heavy commercial vehicle (M&HCV) sales declined by 9.2% to 15,689 vehicles. However on a month-on-month (m-o-m) basis M&HCV sales grew by 8.8%.
- Passenger vehicle segment continued its weak performance and losing its market share, as no new products were launched. Further, being the last month of the year, off take to dealers was curtailed to limit year-end stock. The domestic sales declined by 12.3% to 14,316 vehicles. Passenger car sales for the month declined by 14.1%. Indica sales declined by 10% yoy to 9,497 units, while Indigo sales fell by a whopping 33.6% yoy to 1,379 vehicles. Sales of Utility vehicles declined by 10.6% yoy to 3,440 units. However, sales of Safari recorded a growth of 10% to 1,161 units mainly due to recent launch of Safari Dicor VTT.
- Export sales for the month grew by 15.7% yoy and 26% mom to 4,701 vehicles.
- Tata Motors has recently launched six new products in the M&HCV segment, which includes multi-axle trucks, heavy-duty trucks (31-49 tonne capacity), tractor-trailers and tippers. These vehicles have multiple applications and will cater to sectors like mining, construction, road works and logistics.
- The company also plans to unveil its new one-lakh car scheduled for launch by mid 2008 at the forthcoming Auto Expo.
- At the current market price of Rs790, the stock discounts its FY2009E consolidated earnings by 12.4x and is available at an enterprise value (EV)/earnings before interest, depreciation, tax and amortisation (EBIDTA) of 6.2x. We maintain our Hold recommendation on the stock with a price target of Rs792.
SECTOR UPDATE
Cement
Strong demand buoys volumes
Traditionally, December is a good month for cement companies in terms of volume and price realisation, as construction activities gather pace post-monsoon. For the month, all major cement manufacturers barring ACC reported positive growth in their dispatches. ACC dispatches for December 2007 stood at 15.7 lakh tonne against 16.7 lakh tonne for December 2006, which is 6% lower compared with that of the corresponding period last year. The volume dip was on account of lower production in one of its facilities in the South due to maintenance shut down and rains.
Gold near all time high
Gold Prices are a dollar short of kissing the all time high record price of $873
Precious metals once again ended considerably higher today, 03 January, 2008. Gold prices rallied and crossed the $870/ounce mark during intraday trading after crude oil prices continued to hover around $100/barrel mark. Weakening of the dollar also contributed to higher gold prices.
Gold generally moves in the opposite direction of the U.S. currency. Gold, as a dollar-denominated commodity, suffers from dollar strength.
Comex Gold for February delivery rose $9.1 (1.1%) to close at $869.1 an ounce on the New York Mercantile Exchange on Thursday, 03 January, 2008. Prices touched $872 during intraday trading. With today’s gain, gold has gained 3.7% in 2008. Last year, on 7 November, prices had touched $848/ounce. Today’s closing prices was the highest price after a record $873 that gold hit on 21 January, 1980.
Comex Silver futures for March delivery rose 21 cents (1.4%) to $15.5 an ounce. Prices touched 26 year high on 7 November, 2007, after reaching $16.275. With today’s gain, silver has gained 3.9% in 2008. The metal had climbed 15.5% in FY 2007. The metal also has gained for seven straight years.
Gold witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
In the currency market today, the dollar drifted lower against most major currencies, unable to hold earlier gains on the eve of key data about the state of employment in the U.S. economy. The dollar index, which tracks the performance of the greenback against a basket of other major currencies, edged down 0.2% to 75.835. The dollar traded near a one-month low against the euro.
In the energy market today crude oil continued to hover around $100/barrel mark. Oil reached a record $100.09 a barrel before erasing gains. It closed marginally lower after an Energy Department report showed that U.S. gasoline and diesel inventories rose as refineries increased operating rates. In FY 2007, crude prices gained $57%.
Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices. Rising crude increases inflationary pressures and vice versa. On the other hand strong dollar reduces the appeal of the metal as alternate source of investment.
Gold had climbed 31% in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record.
The Fed reduced federal funds rate three times in FY 2007. The current interest rate stands at 4.5%. The Fed also lowered its discount rate twice, the interest it charges on direct loans it makes to banks, and currently it stands at 4.75%. With these interest rate cuts, dollar has been tumbling down. Market anticipates that there will be more rate cut in the coming year.
At the MCX, gold prices for February delivery closed higher by Rs 96 (0.88%) at Rs 10,975 per 10 grams. Prices rose to a high of Rs 11,014 per 10 grams and fell to a low of Rs 10,831 per 10 grams during the day’s trading.
At the MCX, silver prices for March delivery closed Rs 169 (0.84%) higher at Rs 20,053/Kg. Prices opened at Rs 19,853/kg and went to a high of Rs 20,144/Kg during the day’s trading.
Gold is expected to rally to all-time highs in the first quarter in FY 2008 as higher oil prices and a weaker dollar will continue to boost demand.
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