Market Close: Just a Profit booking or ??

Profit booking engulfed across from Asian Markets as well in Indian Indices too. Major Asian markets ended in red, Hang Seng lost 505 points for the day and Nikkei slipped by 107 points. Indian indices started the day on a weak note but selling pressure intensified pushing the indices further into red zone and continued to trade in negative territory for the whole day. Mid session witnessed some value buying in index heavy weights helping Indices to recover from days low but profit booking contiued till the end. Banking stocks were the major hit on fear of CRR hike, weakness followed in FMCG too and IT stocks slipped as Rupee appreciated. Rupee ended at 39.49 after days high of Rs 39.35 against US Dollar. This is certainly not good for IT companies. Buying was seen in Auto, Metals, Consumer Durable, Engineering and Energy stocks cheered the day. Investors rejoiced mid and small caps, as they out performed the front line indices.

Sensex ended lower by 70 points at 17777.141. Weighing on the Sensex were the losses in HDFC (2494.6499,-4 percent), ONGC (985.95,-4 percent), ICICI Bk (1061.35,-2 percent), Wipro (461.3,-2 percent) and Hero Honda (721.1,-2 percent). Losses were restricted by gains in NTPC (226.4,+4 percent), TISCO (864.75,+3 percent), Cipla (189.05,+2 percent), Maruti (1041.3,+2 percent) and Rel Energy (1477.85,+2 percent).

Educomp Solutions Ltd has informed that the Company has signed MOU with Raffles Institution, Singapore. The Scope of Services would include consultancy advice & services of Raffles Institution for schools set up by the Company though its related entities. Raffles institution is the leading school in Singapore and renowned for its innovative practices and its curriculum. Educomp offers solutions in pre-school learning management, K-12 schools, school management and e-tutoring. It has Smart Class learning management modules e-tutoring products such as Mentoraide, Mathguru.com and Roots to Wings for the kinder garden. The company has been aggressively and wants to grow inorganically. The company in past few months has been acquiring many small firms across the globe. It acquired AsknLearn, a Singapore based e-learning content provider, then ThreeBrix E-Services which owns learninghour.com which is an online and offline learning solutions provider. It also took majority stake in Savvica, a Canadian company. Last but not the least it also partnered Microsoft Xbox 360 which is foraying into the educational arena. The edutainment product for the Xbox 360 is being developed by Lakshya Digital in Gurgaon and the company is planning to launch the product by December 2007. The aggressive Plans is to go global and spread his wings. Educomp being foremost and only listed company before has now competition from Everonn and Navneet. Educomp and Everonn trade at over 85 times estimated FY08 earnings. Do read the detailed note on Educomp, Everonn and Navneet.

Temptation Foods has earmarked a sum of Rs 180 Cr for acquiring three companies. This is in addition to the company's plan to purchase Marico's jam brand SIL and soy balls Meal Maker and Ever fresh, the second largest player in the frozen food business. The Ever fresh deal is likely to be priced at Rs 40 cr. The company is eyeing two companies in the northern region and one in the south and fall under the processed food category. Temptation foods is on acquisition frenzy. This is after the break up of acquisition plans with HUL's marine Business. The company is trying to chew much more than what it can digest. We are not positive on the stock at the moment. The stock closed down by 5% for the day.

Technically Speaking: It was a weak session for the whole day before closing. Sensex touched intraday high of 17890 and low of 17495. Overall breadth was in favor of Declines, where the Advances stood at 1152, while Declines at 1591. The turnover was good at Rs 7688 cr. As we mentioned earlier Sensex is looking steady for a move up to 18500-18600