Market Close: Phenomenal 19K conquered..What?s next?

It was a fantastic run-up for the market today. A good come back from the Friday's low. Asia traded mixed but Indian market traded by itself and continued to hit life time high 19096 level during the closing trades. Easing of political worries and improved Index of Industrial Production (IIP) figures for August 2007 supported the bourses for northward journey. Indices traded further into the green as heavy buying activity intensified during the final hour of trades. Huge monetary in flows and abundant liquidity continue to take markets at new peaks. Heavyweights have notched up further; metals were the top gainers for the day. Smallcap and Midcap indices ended up by 2.5% each. Value buying was seen in stock like Power and Energy while selected Oil & Auto stocks were out of favor for the day. This was the first time markets ended above 19K mark. Asian markets ended in green while European market trading in mix.

Sensex took 4 days to hit 19000 marks. This rally is considered as the fastest ever 1,000 Point rally for market. Main contributors for 1000 points were RIL -153 Pts, ICICI Bank -120 Pts, ONGC -119 Pts, L&T -108 Pts, Bharti Airtel -96 Pts. Top 5 stocks contributed 60% of the rally from 18K to 19K.

Sensex ended up by 640 points at 19058.67. It was helped up by gains in Rel Energy (1847.35,+13 percent), ONGC (1191,+9 percent), TISCO (911.4,+7 percent), Maruti (1160.35,+6 percent) and Hindalco (188.85,+6 percent). Restricting the gains were HLL (219.2,-1 percent), Infosys (1928.75,0 percent).

Chennai-based Consolidated Construction Consortium Ltd made an impressive debut on the bourses at Rs 801 with a premium of 57 % against issue price of Rs 510. CCCL is an ISO-certified company. It has a pan-India presence and is engaged in construction, engineering, procurement and project management. The Initial Public Offer (IPO) of CCCL received tremendous response from investors with the issue getting subscribed over 80 times. CCCL had entered the capital market with an IPO of 3.7mn shares at a price band of Rs 460-510 per share. The company has raised Rs 188.70 crore from the issue at price of Rs 510 per share, at the higher end of price band. The company plans to use the proceeds to finance acquisition of construction infrastructure, for investment in subsidiaries, skill and management development center, repayment of loans and general corporate purposes. The realty sector is currently one of the prefers stock looking at the infrastructure growth coming in India. CCCL traded up by 50% and ended up by 57%. We have a report on the company please go through the detailed note in our site.

Solar explosives had good results. The worst seems to be behind this one. The numbers were exceptional even though this is the weak season. Usually production during first two quarters is slow as construction and mining activities are restricted during the monsoon season. On a consolidated basis, the company posted revenue of Rs.64 crs against Rs 35 cr in the same quarter last year with a growth of 80%. The Ebidta margins had fantastic jump from 11% last year to 21% this year. The business is good with strong barriers to entry and Solar has the edge with its high market share and explosive experts. The stock trades at Rs 235 which is a valuation of 21 times trailing earnings for FY 07. A P/E of 17 for FY 08 on a conservative seems expensive.. but we believe earnings in 2009 and 2010 will explode as private sector gets going on its mining activities. 60% of revenues come from coal India and now this is the post consolidation phase for the Industry.

Technically Speaking: Markets traded well on the back of strong positive breadth. Sensex touched intraday high of 19096 and low of 18526. Over all market turnover was fantastic for the day at Rs 9943 Cr. Market breadth was in favor of Advances, where the Decliners stood at 880, Advances were stood at 1868. Sensex medium term support lies at 18300. Traders are advised to trade long and maintain stoploss of 18500 for tomorrows intraday.