News. December 31, 2006
Posted by Bhavin in Stock Articles.4 comments
Inflation rises to 5.43%
India’s inflation, based on the Wholesale Price Index (WPI), rose to 5.43% in the week ended December 16 owing to a rise in the prices of manufactured products, the Government said on Friday. Economists had been looking for a reading of around 5.28%. Inflation was 5.32% in the previous week and 4.62% in the year-ago period. The WPI rose by 0.05% to 207.8 from 207.7 in the previous week. The index for Primary Articles (weight: 22%) declined by 0.1% to 211.8 from 212.1 in the previous week. The index for Fuel, Power, Light & Lubricants (Weight 14.23%) remained unchanged at its previous week’s level of 322.6. The index for Manufactured Products (Weight 63.75%) rose by 0.2% to 180.8 from 180.5 in the previous week. Meanwhile, the Government revised upwards the inflation rate for the week ended October 21, from a provisional figure of 5.41% to 5.61%. The final WPI for the same period stood at 208.8 compared to the preliminary level of 208.4.
Govt mulling FDI in select areas of retail
Foreign investors could get a new year’s gift from the Government. The bounty could come in the form of FDI in various areas of the organised retail. According to newspaper reports, the Commerce & Industry Ministry is preparing a detailed policy on further liberalisation of the retail sector. The official announcement on the same is likely to come before the budget. The Government is considering allowing 51% FDI in retailing of sports goods, electronics goods and building equipment, the papers report. Since there are no small manufacturers or retailers in these areas, the Government might permit FDI in both the front-end and in the back-end operations. Also on the anvil is a plan to allow multi-brand outlets in these areas. What is not clear, however is that whether the Government will allow FDI in these areas through the automatic route or through the Foreign Investment Promotion Board (FIPB). Another caveat is that the Government will have to get the green signal from the Left parties before going ahead with any such move.
Govt awards LOI for two UMPPs
The Government awarded the Letters of Intent (LOI) for awarding the first two Ultra Mega Power Projects (UMPPs) to the successful bidders, namely Tata Power Co. Ltd. and Lanco Infratech Ltd. Union Power Minister Sushil Kumar Shinde handed over the LOI to the consortium of Globeleq Singapore Pte. Ltd and Lanco Infratech Ltd. for Sasan UMPP in Madhya Pradesh while Tata Power bagged Mundra UMPP in Gujarat. Bids for these projects were received earlier and the successful developers were selected on the basis of lowest quoted tariff. The process of selection of successful developer for other UMPPs namely, Krishnapatnam (Andhra Pradesh) and Tiliaya (Jharkhand) is expected to be completed by April 2007. Request from Jharkhand for an UMPP is also under consideration. The Government of India has envisaged a capacity addition of 100,000 MW to meet its mission of ‘Power For All by 2012’. Achievement of this target requires the development of large capacity projects at the national level to meet the requirements of a number of states. The Government is working together for the development of 9 UMPPs through tariff-based competitive bidding.
No pulling out from Singur: Ratan Tata
Despite the controversy surrounding land acquisition in Singur, the Tata Group will not take a backward step on the proposed one-lakh car project, said Ratan Tata, the chairman of the group. The issue snowballed into a political hot potato, with Trinamool Congress leader Mamta Banerjee going on a hunger strike (which she ended later in the week) and the BJP backing her opposition to the proposed car factory. But notwithstanding the local resistance and political pressure, Ratan Tata has made it clear that the group intends to go ahead with its plans for the new plant in West Bengal. “I think the West Bengal government has been very steadfast in its support of the project and I think it would be wrong for us to say that we will pull out and go,” he told NDTV 24×7 in an interview, to be telecast on Saturday at 10 pm.
Anil Ambani confirms interest in Hutch Essar
Reliance Communications Ltd. (RCL) officially confirmed that it is interested in buying Hutchison Telecommunication International Ltd.’s (HTIL) 67% stake in Hutchison Essar, a joint venture between the Essar Group and HTIL. “RCL, as part of its overall growth strategy, is continuously examining several organic and inorganic growth opportunities. Hutch Essar is one such situation,” Anil Ambani, Chairman of RCL said. “A potential combination of this nature could create compelling value for all shareholders of RCL.” Ambani said that his company has exclusive financial support from leading international banks and financial institutions to acquire Hutch Essar. “Frankly, we have lost count of how many private equity players have lined up behind us,” the junior of the two Ambani brothers told a news conference in Mumbai. “The vast majority of the top 10 players are with us.” RCL will need funds to fend off competition from Vodafone, the world’s largest mobile-phone company, and Essar Group, which controls a 33% stake in Hutch Essar, India’s fourth-largest wireless company. According to reports, Vodafone and the Ruias of Essar Group have put forward their indicative prices which value Hutch Essar between US $16.5bn and US $18bn. This is substantially lower than the US$21bn sought by HTIL. Essar has the first right of refusal, or the right to be first offered the option of buying HTIL’s stake in Hutch Essar.
S&P affirms Reliance ratings
Standard & Poor’s (S&P) affirmed its long-term foreign and local currency ratings on Reliance Industries Ltd. (RIL) at ‘BBB’, indicating investment grade. The affirmation reflects RIL’s dominant competitive position, the relatively stable medium term prospects for its core refining and petrochemical businesses, and an overall moderate financial profile of the company, the global credit rating agency said in a statement. The ratings, with stable outlook, factor in the likelihood of timely completion of its ongoing projects, specifically the new refinery at Jamnagar. It is also underpinned by the expectation that RIL would pursue its non-core businesses, specifically the retail foray, in a phased-out manner, as an accelerated investment strategy can weigh on the company’s overall credit p rofile, S&P said.
The ratings remain constrained by RIL’s exposure to highly cyclical industries, large capital commitments in its refining, exploration and production businesses, and uncertainties in developing its reportedly large gas reserves, it added.
Dr. Reddy’s wins nod for generic Zofran
Dr. Reddy’s Laboratories Ltd. announced that the USFDA had granted final approval for it’s Abbreviated New Drug Application (ANDA) for Ondansetron Hydrochloride Tablets, in 4mg, 8mg, 16mg and 24mg strengths. As the first company to file an ANDA containing a paragraph IV certification for this product, the company has been awarded a 180-day period of marketing exclusivity, Dr. Reddy’s said. The company will commence the shipment of this product shortly, it added. Dr. Reddy’s Ondansetron Hydrochloride Tablets are the AB-rated generic equivalent of GlaxoSmithKline’s Zofran tablets, a product indicated for the prevention of nausea and vomiting associated with cancer treatment. The brand product has annual IMS sales (June 2006 MAT) of about US$639mn. “With six product introductions to date in the current year, we are making good progress in building a sustainable base generics business with potential upsides in the US in the medium term,” said G.V. Prasad, Vice-Chairman and CEO of Dr. Reddy’s.
Wockhardt launches Ondansetron injection in US
Wockhardt Ltd. said that its US subsidiary launched Ondansetron injection, the first working day after the patent for the product expired on Dec. 24. Ondansetron is the generic version of GlaxoSmithKline’s Zofran injection and is used in controlling nausea and vomiting following cancer chemotherapy. It is the largest selling anti-emetic product in the world. Sales of Zofran injection in the US during the 12 months ended Sept. 30, 2006, were US$628mn. According to the online magazine Drug Topics, Zofran was the 20th most expensive brand-name drug used in hospitals in the US in 2005, with total costs of US $839.26mn. Ondansetron injection is manufactured at the USFDA-certified sterile formulation plant at Waluj in Aurangabad. Wockhardt has two other sterile formulation plants approved by USFDA in India and the UK. “This is Wockhardt’s eighth product approval from USFDA in 2006 and the third injection product in the US market,” said Wockhardt Chairman Habil Khorakiwala. “We now market 15 products in the US, with 10 of them launched during 2006.”
Indian Hotels buys Amalgam Foods
Indian Hotels Co. Ltd. said that Residency Foods & Beverages Ltd. (RFBL), an associates company, has picked up 80.6% stake in Kochi-based Amalgam Foods & Beverages Ltd. (AFBL) for Rs 180mn. Residency Foods is an existing associate company of Indian Hotels with interest in the food & beverages business. The acquisition has been made by Residency Foods in a related line of activity, namely foods. Residency Foods is an unlisted company in which Indian Hotels holds a 25% stake. Amalgam Foods is part of the Rs2.5bn sea food exporter Amalgam Group and has a portfolio of frozen ready-to-eat products under the Sumeru brand. The company is currently selling its products through 2,000 outlets across the country.
Bajaj Hindusthan FY06 net up 36% yoy
Bajaj Hindusthan Ltd. reported a 36% increase in net profit at Rs1.91bn for the financial year ended September 30, 2006. The company’s net profit during 2004-05 stood at Rs1.4bn. Total revenue stood at Rs14.87bn for the year 2005-06 versus Rs8.55bn in the previous year, registering a growth of 74%. The company has recommended a dividend of 60%. Bajaj Hindusthan’s sugar sales volume increased 57% during the year to 720,798 tons. “The results could have been much better but for higher cane prices, lower recoveries due to earlier start of the crushing season and the Government’s ban on exports, which impacted the domestic sugar realisations,” Chairman and Managing Director, Shishir Bajaj said. He said that the expansion of the company’s subsidiary Bajaj Hindustan Sugar and Industries Ltd. (BHSIL) was on schedule and crushing was expected to start at 40,000 tons crushed per day (TCD) in the next crushing season.
Japanese industrial output hits new record
Japan’s industrial production rose to a new record in November, buoyed by increased demand for it’s cars, consumer electronics, liquid crystal displays and game consoles in the global market. Factory output rose by a seasonally adjusted 0.7% from a month earlier. The average estimate of economists was for an increase of 1%. The industrial production index climbed to 108.6, the highest ever as measured by the 2000 base year. The rise followed a 1.6% gain in October from September. Year-on-year, output rose 4.8% in November, the 16th consecutive month of increase. Manufacturers’ output – the core component of production – is expected to rise a further 0.7% in December but would slip 0.8% in January. The trade ministry maintained its assessment on industrial output, saying that it is on a rising trend. Despite a rebound in production and shipments, the inventory index rose a sharp 1.4% from the previous month to 97.2 in November, an all-time high. Record production, combined with recent reports that showed rising inflation and a drop in the jobless rate, may prompt the Bank of Japan to hike the lowest interest rates among Group of Seven (G7) countries as soon as next month. Central bank Governor Toshihiko Fukui and his policy board are scheduled to conclude their next rate meeting on January 18.
Taiwan quake affects undersea cables
Telecom and Internet services across South East Asia was badly affected after a major earthquake hit southern Taiwan on Dec. 26. The quake, measuring 7.1 on the Richter scale, damaged at least eight undersea fibre-optic cables that connect Asia with the rest of the world. The damage to the undersea cables disrupted voice as well as data traffic and hit business in the region. However, by the weekend, most telecom operators recovered most of their voice services and Internet access. China Network Communications and PCCW said they have normal voice services. Japan’s Softbank Corp. said 83% of its affected 152 corporate lines had recovered. The improvement in telecom services was due to operators rerouting traffic overland to Europe, then to the US, or via Southeast Asia to the US. Repairing the broken submarine cables may take two to three weeks.
Apple under scanner for stock options grant
Shares of Apple Computer fell on renewed concerns over the company’s stock-option granting practices. A California legal publication said that CEO Steve Jobs had hired a lawyer to represent him in federal inquiries and that some officials may have falsified documents. London-based Financial Times reported that CEO Steve Jobs was handed 7.5mn stock options in 2001 without the required authorization from the Apple’s board. The FT report said that records purported to show a full board meeting had taken place to authorize the stock options were later falsified. The story didn’t say who falsified the report. Jobs later surrendered his options before they were exercised, implying that he did not gain any direct benefit from them, FT reported. A spokesman for Apple said that the company had handed over the results of its previously announced internal probe to the Securities and Exchange Commission (SEC).
IBM, Siemens bag mega IT deal
International Business Machines (IBM) and Siemens announced that they had won a US $9.3bn deal to modernize the German military’s technology. The 10-year project, codenamed Herkules, foresees the modernization of the computers and communication networks for the German armed forces. According to a statement from the military, that covers more than 140,000 computer workstations, 7,000 servers, 300,000 telephones and 15,000 mobile phones. Siemens Business Services and IBM’s German unit jointly will hold 50.1% of a company being founded with the German government, named BWI Informationstechnik, to carry out the project. The federal government will hold the remaining 49.9%. IBM will be responsible for modernising the data centres, while SBS will take care of PCs, servers and phone systems at more than 1,500 locations around Germany.
Pfizer wins Viagra copycat case in China
Pfizer won a trademark case in China blocking drugmakers in the Middle Kingdom from copying its Viagra impotence pills’ blue diamond shape. A Beijing court ordered the three companies to pay a US$38,000 fine to Pfizer, stop producing the blue, diamond-shaped pills and print a public apology in a Chinese legal newspaper. This is the second intellectual property victory in China this year for New York-based Pfizer. In June, the same court sided with Pfizer in overturning a 2004 decision by China’s patent and trademark office that had invalidated Viagra’s patents. Pfizer has a separate lawsuit filed in China that would block companies from using Viagra’s Chinese name. Viagra is one of the world’s most copied drugs, according to the World Health Organization (WHO). Viagra was used by 23mn men and had worldwide sales of US $1.6bn last year.
Major News
Hindustan Zinc cuts prices by Rs3200 to Rs2,21,500
Aurobindo Pharma acquires Pharmacin International in Netherlands
Lanco Infratech secures 4000 MW Ultra Mega power Project in MP
SBI plans to raise Rs20bn by March 07
State Bank of Mysore raises prime rate to 12% from 11.5%
Unichem gets nod to sell generic Mobic in US
Insider Trades:
Aurionpro Solutions Limited: Mr. Sandeep Daga, Director has sold in open market 9695 equity shares of Aurionpro Solutions Limited on 26th December, 2006.
Gujarat Ambuja Cement Ltd: Shri P B Kulkarni (Director) has sold in open market 12000 equity shares of Gujarat Ambuja Cement Ltd on 27th December, 28th December and 29th December 2006.
GENERAL
1)Manipur, Punjab and Uttaranchal will go to the polls in February next,
the Election Commission announced on Friday. Manipur (60 constituen-
cies) will witness polling on February 8,15 and 23; Punjab (117 consti-
tuencies) on February 13 and Uttaranchal(70 constituencies) on February
21. The terms of the Assemblies are due to end on March 11,17 and 20.
Hindu
ECONOMY
2)INFLATIONARY pressures heightened at the close of the year, touching
5.43% for the week ended December 16, one basis point short of the
fiscal’s highest inflation rate. The inflation stood at 5.32% in the
previous week. Inflation had touched its highest-level of 5.44% this
fiscal on June 17, which prompted the government to relax imports of
wheat, pulses and sugar, besides banning exports of sugar to augment
supply of these essential commodities. Finance minister P Chidambaram
said that the government’s immediate goal is to control inflationary
expectations, with a view to contain inflation below the 5%-mark in
2006-07 and below the 4%-mark in the medium term.
ET
3)Industry body Assocham has demanded creation of a Rs 100 crore venture
capital fund to enable various domestic outsourcing industries to take
on global giants and retain their strength in the global market. The
fund should be created with public private partnership to provide easy
financing facilities to business process outsourcing(BPO), knowledge
process outsourcing(KPO) and business transformation outsourcing(BTO)
industry to grab larger domestic ITeS market size from competing coun-
tries, the chamber said in a statement.
BS
CORPORATE / INDUSTRY
4)Aban Offshore Ltd on Friday said that its wholly owned subsidiary Aban
Singapore Pte Ltd(ASPL) will present an open offer to acquire the
remaining shares of Sinvest ASA for approximately $800 million. Aban
had bought 33.76% stake in Sinvest in June this year for an equity
value of $1.32 billion nd an enterprise value of $2.25 billion. The
open offer will enable the company to acquire a majority stake in
Sinvest ASA, there by placing it in the league of top 10 offshore dril-
ling service providers in the world in terms of offshore drilling assets
under management, Aban said in a statement to the BSE.
FE
5)THE Lanco Group has signed a memorandum of understanding with the
government of Jharkhand for setting up a 2,640-mw thermal power pro-
ject in the state. As per the pact, the state government would assist
in land acquisition, infrastructure support and recommend captive coal
blocks required for the project. The MoU closely follows Lanco Group’s
recent win of the country’s first 4,000-mw ultra mega power project
estimated to cost Rs 16,000 crore by quoting a tariff of Rs 1.19 per
unit. With the Jharkhand project, Lanco’s total power generation
capacity would touch 12,000 mw.
ET
6)HYDERABAD-based Aurobindo Pharma has, through its subsidiary Agile
Pharma, Netherlands, acquired for E6 million Dutch generic pharma com-
pany Pharmacin International for an undisclosed sum. This is Aurobindo’s
second acquisition in Europe after it took over the UK’s Milpharm early
this year. According to a company statement, the acquisition will help
Aurobindo reduce its time to market in Europe and also build a broad
portfolio in the generic value chain. Pharmacin brings to the table
its strong presence in Europe with over 200 product registrations for
63 customers in Europe. With this acquisition, Aurobindo will gain
an opportunity to expand into several markets in Europe with Pharmacin’s
network.
ET
MONEY / BANKING
7)Despite an infusion of close to Rs 1,26,000 crore over a week by the
Reserve Bank of India(RBI) to ease the ongoing liquidity crunch, call
rates ended at a nine-year high of 18.5%-19.5% on Friday. The rates
recorded an intra-day high of 21% on the last reporting Friday of the
2006 calendar year.
FE
8)Oriental Bank of Commerce (OBC) has crossed another milestone, with
the total business of the bank touching the Rs 1,00,000 crore mark
on December 22. The public sector bank expects to close the current
calendar year with total business of over Rs 1,01,000 crore, its
chairman and Manging Director, Mr K N Prithviraj, said on Friday.
BL
9)Federal Bank plans to enter the capital market shortly to mobilise
fresh resources to fund some of its strategic investment projects. “We
should be entering the capital markets some time next fiscal either
through a rights or public issues,” said Mr M Venugopalan, Chairman.
BL
INSURANCE
10)THE INSURANCE Regulatory Development Authority(Irda) has said that
general insurance companies can alter premium rates only once in six
months even in a free pricing regime following detariffing. This
means that insurers will have to be very careful in pricing as they
will not be able to revise rates immediately if they find that their
quotes are not enough competitive or profitable enough.
ET
MARKETS
11)The Sensex and Nifty ended down on the last trading day of 2006 as in-
vestors trimmed positions ahead of the extended weekend. Equity market
will be closed on Monday for ‘BakrEid’. The indices erased early gains
as investors booked profits in heavyweights Hindustan Lever and Oil
and Natural Gas Corp. Metal shares gained the most as prices remained
firm on the London Metal Exchange, while shares of fast moving consumer
goods were the worst hit. The Bombay Stock Exchange Sensex ended at
13786.91, down 59.43 points or 0.4 per cent from Thursday. It touched
a low of 13770.06 and high of 13929.10 intraday. The National Stock
Exchange Nifty settled at 3966.40, down 4.15 points or 0.1 per cent.
BS
12)THE year 2006 was a rocking one for the stock markets. And a rocky
one too! Not only did the sensex show a whopping jump of 47%, it also
demonstrated the greatest volatility in the last five years in 2006.
An ETIG analysis reveals that the annualised volatility coefficient
for sensex stood at 26% for 2006, compared to 17% and 25% during 2005
and 2004 respectively. The benchmark index was significantly less
fluctuating in 2003 and 2002 also, with annualised volatility coef-
ficients of 19% and 17% respectively. The bourses witnessed huge see-
saw movements during the year, with a continous upward movement from
January to May, a sudden crash from May to June and then again a strong
recovery continuing throughout till December. On the one hand, sensex
touched an all-time high of 14,000. On the other, it witnessed its
single largest fall ever in one trading day since 1991. With Indian
markets getting more globally aligned, this year witnessed sharper reac-
tions to global macreconomic changes and domestic policy measures. An-
nualised volatility indicates the amount of fluctuations in market move-
ments during the year. The higher the volatility, the riskier it is
to invest for a short term.
ET
13)Dalal Street has been witness to a major roll-a-coaster ride this
calendar year as the equity markets staged an impressive come-back from
a massive fall in May this year, only to bounce back sharply, and breach-
ing new peaks, gaining 46% since January. Interestingly, of all the
BSE sectoral indices, only BSE Capital Goods(CG) index and BSE Tech
index were able to outperform the benchmark Sensex by a wide margin,
by registering a gain of nearly 56% and 50% respectively. All other
BSE sectoral indices have been under-performers, when compared with
the Sensex. “The companies under the Teck Sector has come out with
good quarterly numbers and hence are in great demand with the investors,”
said Amitabh Chakraborty, Head-Research, Brics PCG said.
FE
14)INFOSYS was the sole tech heavy weight amongst the top five Indian
IT service providers that managed to outperform the benchmark Nifty
index during 2006. The other tech stocks like Wipro, Satyam and HCL
Technologies, gave less returns (than Nifty). An analysis of the
scrips of the top 10 IT services companies(in terms of their market
capitalisation) reveals in the Tier-II software companies MphasiS
and i-flex churned-out spectacular returns for investors, while the
largest software exporter TCS’ stocks performed in line with the Nifty
returns of 43.2%. “Infosys got listed at the Nasdaq-100 index and this
had a very positive impact on its scrip at the domestic stock exchange.
Some of the other tech stocks have not performed very well at the index
this year, especially Patni, which lost some of its significant clients
to other IT companies,” said KPMG executive director & head markets,
Pradeep Udhas. The Nasdaq-100 index comprises 100 largest non-financial
stocks on the Nasdaq Stock Market in terms of market capitalisation.
Infosys’ addition to the elite list ensures that the company joins the
ranks of global tech giants like Google, Yahoo, Amazon, Oracle and
eBay. Infosys stock on Nifty, during 2006, gave investors Rs 151 for
every Rs 100 invested. During the same period, the Nifty index –
which rose from 2750 to 3940 points – generated returns of Rs 143.2
for every Rs 100 invested.
ET
15)The government on Friday ruled out extending the December 31 dead-
line for investors to submit their PAN details to depositories for
trading on the stock exchanges, according to finance ministry
sources.
FE
16)The BSE and the NSE are now working on a common portal for dis-
semination of filings of corporates listed on the stock markets and it
is expected to go live by January 1,2007, an official release said.
BL
IPO
17)Cambridge Technologies Enterprices Limited (CTEL) is coming out
with a public issue of 63,15,800 equity shares of Rs 10, for a cash
price of Rs 38 per equity shares, inclusive of premium of Rs 24 crores.
The issue opens December 29 and closes January 9,2007.
FE
18)Nelcast Limited is planning to come out with an Initial public Offer
(IPO) to raise capital to double their installed capacity from 72,000
TPA to 1,50,000 TPA by 2008. The company has filed its draft of red
herring prospectus with the market regulator said.
FE
MERGERS & ACQUISITIONS
19)India Inc’s cross-border acquisitions may have topped $20 billion in
2006, but that is just a dot in the global M&A space, whose volume
reached a record $4 trillion through 31,858 deals. However, India-
born steel tycoon L N Mittal and Arcelor emerged the world’s fourth
biggest deal this year. US telecom gaint AT&T’s $83.4 billion buyout
of Bell South Crop, announced in March, is this year’s top M&A deal,
according to data from global financial information provider Dealogic.
FE
COMMODITIES
20)Gold edged higher on the last working day of the year to trade just
below a three-week high, and was likely to extend gains in 2007, dealers
said on Friday. Lingering worries over Iran’s nuclear ambitions and a
weakness in the dollar against the euro kept market sentiment positive,
they said. “Having broken through key chart levels at $630 (an ounce),
further gains could be in store for gold should it be able above $630
and position for a break higher in the New Year,” Standard Bank said
in a daily report.
BL
21)The prices of pulses, particularly chana, have declined by about 10
per cent in spot as well as futures markets over the month, owing to
low demand and the expectation of a better chana crop this rabi season.
Owing to the overall bearish sentiment in pulses, urad futures have
also declined by about 6 per cent.
BS
22)Gold recovered smartly on the bullion market on Friday due to heavy
demand from stockists after firm global advices. Silver gained on in-
creased support along with higher London advices. Standard gold(99.5
purity) ended at Rs 9,145, up Rs 95. Pure gold (99.9 purity) hardened
to Rs 9,195. Ready silver (.999 fineness) pared initial gains to end
at Rs 19,430, a gain of Rs 75.
BL
REAL ESTATE
23)THE REAL estate industry is on an hiring overdrive with the top
realty companies out to double their headcount over the next one year.
Top real estate companies such as DLF, Emaar MGF, Unitech, Omaxe
et al are out to double their employee base in the next 12 months.
ET
COMMUNICATIONS
24)IF FREE SMSs in your pre-paid and post-paid mobile plans lured you
into taking your connection, then beware of going overboard on January
1. Consumers may be unaware, but even those who come under the plans
offering free SMSs will have to pay for the service on January 1.
Mobile operators claim that charging SMSs on New Year’s Day is a way
to ensure network decongestion. So, while you send mobile messages
to all your friends and family on New Year, keep a tab on your mobile
bill.
ET
INFORMATION TECHNOLOGY
25)IBM has been shortlised by the Income Tax department for supply of
servers for its proposed national data centre. IBM toppled HP and
Sun-Wipro in the race for the Rs 250-crore tender. The proposed
national data centre is crucial to the single data processing system.
The much-touted zone-free filing of income tax returns is contingent
to setting up of a single data centre. Under zone-free filing a tax
payer residing in one city or a locality can file his or her income
tax return anywhere in India. They would also be able to get their
income tax refund anywhere.
ET
INTERNATIONAL
26)Oil prices edged lower towards $60 a barrel on Friday as unusually
mild weather deterred buyers and the market looked poised for its
first year-on-year decline since 2001.
BL
Intraday 29-12-2006. December 29, 2006
Posted by Bhavin in Intraday Calls.add a comment
Buy:
Sobha Deve,
Parsvnath,
India Ceme,
Bombay Dye,
TCS,
RIL,
Mahindra Gesco,
TITAN,
Voltas.
Regards,
Bhavin.
News. December 29, 2006
Posted by Bhavin in Stock In News.3 comments
Markets will remain buoyant today with positive performance from index stocks. Nifty will cross 4,000 and Sensex will cross 14,000 levels during the day, says Bose.
Cement prices likely to harden on rising demand
Rates may increase further by Rs 15-20 per bag.
Tata Power looking at coal mines abroad; Lanco in talks for Chinese equipment
The two companies awarded contracts for ultra mega power projects
Bajaj Hindusthan net profit rises 36%
Bajaj Hindustan Ltd (BHL) has recorded a 36 per cent jump in net profit to Rs 190.83 crore during the financial year ending September 30, 2006 against Rs 140.39 crore registered during the same period last year.
TCS begins grooming science grads for career in IT
Science graduates to software professionals – that is what 500 graduates in mathematics and physics from 125 colleges will become after going through TCS Ignite.
Brokerage House Reports: December 29, 2006
Posted by Bhavin in Stock In News.add a comment
Brokerage houses are bullish on Gujarat Gas, Gateway Distriparks, UltraTech Cement and Rolta India.
New Listing. December 29, 2006
Posted by Bhavin in Stock In News.add a comment
Nissan Copper, which entered capital market with an initial public offering, IPO of 64.10 lakh shares of Rs 10 each aggregating to Rs 25 crore, will list today with 1,45,55,905 equity shares. The offer price was fixed at 39 per share.
CNBC-TV18’s Stocks Editor, Udayan Mukherjee expects Nissan Copper to list at around Rs 40-45.
Nissan Copper subscribed 5 odd times. Its customers are Siemens, Voltas, Bluestar etc. It may list around Rs 40-45 and drift near to its issue price of Rs 39 or below that through the day. One should not expect euphoric listing.
Intraday 28-12-2006. December 28, 2006
Posted by Bhavin in Not Stocks..6 comments
Buy:
ACC,
BEL,
Sterlite Opticals,
SCI.
Short:
Parsvnath at high levels with appropriate S.L.
Regards,
Bhavin.
14000 soon!! December 28, 2006
Posted by Bhavin in Technical Analysis.3 comments
The Sensex is likely to target 14,000-mark in the next two trading sessions. However, the market may witness some volatility on account of the December futures & options expiry today.
The index is likely to face resistance around 13,930-13,950-13,970 levels. On the downside the index may find support around 13,790-13,770-13,750 levels.
-Business Standard.
Top News Headlines. December 28, 2006
Posted by Bhavin in Stock In News.add a comment
The Economic Times
Hutch’s $14 bn floor rate lifts valuation to $21 bn
Says it’s yet to receive any ‘acceptable’ offer for its 67% stake in JV
Tatas acquire 81% stake in Amalgam arm
Company valued at Rs 100-150 crore
Now, you can get cover for flight delays
Airlines in talks with insurers to compensate disruptions, fog, accidents
The Hindu Business Line
Ratan Tata blames some competitors
‘They would be happy if Singur project is delayed; but we won’t pull out’
UB Group earmarks $1 bn for overseas buys
Weighing options in Scotland, S Africa, Australia
HAL eyes tiw-ups with global aviation majors
Aims to treble turnover to $3 bn by 2011
The Financial Express
FM radio to get FDI boost
Foreign investment could be hiked to 49%
Periodic review of foreign companies and investment likely
No plan to have a negative list of sectors or areas
Call money at 12.5%
Rupee touches 44.30
Daily News & Analysis – Money
Anil in exit mode?
Vodafone, Essar top brass in Hong Kong for talks with Hutchison
There’s a limit to Corus bid: Ratan
We’ll not jeoparadise shareholders’ interests
Rs 3,500 cr REC tax-saver bonds
But old beneficiaries under section 50EC will be excluded this time
Safe Bet. December 28, 2006
Posted by Bhavin in Fundamental Analysis.2 comments
Is India’s IT industry a growing or a mature business? The market seems to have veered around to the view that IT is a mature business, if you look at the valuations given to small and medium enterprise (SME) IT companies.
While majors like Infosys, TCS, Wipro, Satyam, HCL Tech and Tech Mahindra continue to enjoy market confidence, and high discounting, market seems to think that the second and third-rung companies have little future. So, the market is saying it’s time the IT industry consolidates, the smaller guys need to exit and leave the business to the four-five large companies. That is what you may expect in a maturing business.
Take a look at the valuations some of the SME IT companies are commanding. Mastek, which has been amongst the top underperformers in recent years, is quoting at a P/E of 11 times, and gives a dividend yield of 3% (its amazing how most analysts and investors ignore dividend yield). 3i Infotech has a similar P/E, though dividend yield here is only 1%. NIIT Tech again has a good dividend yield of 2.2% and a P/E of only 13. Tata Elxsi and Zensar have a dividend yield of 2.6% each. Most of these companies perhaps have spare cash on the balance sheet, since IT typically is a cash-generating business unless you spend it on acquisitions.
So do these companies really have no future? Most analysts and fund managers we have talked to over the last few months believe so. They say these companies will grow at rates substantially lower than biggies. This has turned out to be true as well in most cases. However, if you forget the comparison with biggies, then these companies aren’t doing that badly. Let’s look at some growth rates.
Hexaware has grown sales at over 25% and net profits at close to 50% this year. NIIT Tech has grown sales at 32% and net profits at 94% in the first half of FY07. 3i is growing sales at 47% and net profit at 85%. Mastek has been growing sales at 22% and net profit at 32% in the last two quarters. KPIT has grown sales at 46% and net profit at 62% in 1H07. While Tata Elxsi has grown a little slowly, Geodesic has grown both sales and net profit at 100% or more.
In other words, many of these companies are growing reasonably well. So why are their discountings so low? We believe this may be because there is so much overall growth, that the market is ignoring mid-cap IT. Three years ago, these growth rates would have looked fantastic, and even fund managers may have piled on. Currently, there are better returns elsewhere.
At this time, IT isn’t sexy anymore. Compared to real estate, IT is old economy. But for those looking for conservative returns with a margin of safety on the downside, some of these companies may be worth a buy.
Intraday 27-12-2006. December 27, 2006
Posted by Bhavin in Intraday Calls.1 comment so far
Buy:
Century Tex,
Tech Mahindra,
KRBL,
Mid-Day.
Regards,
Bhavin.
Intraday 26-12-2006. December 26, 2006
Posted by Bhavin in Intraday Calls.2 comments
Buy for the day:
ONGC S.L.: 855/=,
ROLTA S.L.:242/=,
Alstom projects S.L.: 450/=.
If 3i Infoteh closes above 190/= for the day we can see it touching new highs in coming days.
Regards,
Bhavin.
Merry Christmas. December 25, 2006
Posted by Bhavin in Not Stocks..4 comments
Christmas is a time of wonder and joy, of generosity and peace, that brings family and friends together in celebration and song. This Christmas we remember those who are without their loved ones. They continue to be in our hearts and prayers. May they experience peace, and may they find hope. And as we again celebrate Christ’s birth, may the glorious light of God’s goodness and love shine forth from our land.
Wishing you a Merry Christmas and a Happy New Year. May God’s blessings of peace be upon us, upon the world and upon those whom we missed so dearly.
Regards,
Bhavin Mehta.
Intraday 22-12-2006. December 22, 2006
Posted by Bhavin in Intraday Calls.5 comments
Due to lack of time was not able to post anything on the blog. Here is what have been recommended on Yahoo Messanger:
Bhavin Mehta (12/22/2006 9:54:08 AM): Moser Baer, Kale Consul, Sobha Dev, Glenmark, Alps Ind, MTNL, Rel Cap, Satyam, Great Off, Yes Bank on buy list….buy accordingly with your own S.L. and book profit as and when arrived.
Enjoy.
Plz. Note: December 22, 2006
Posted by Bhavin in Not Stocks..2 comments
Please note down my wordpress id: https://stockstorm.wordpress.com for your future reference. Please dont ask me again and again during the trading hours on yahoo messanger as its not possible at all. In case Yahoo disables this id do note down my other id mehtastock@yahoo.co.in in case yahoo disables this id of mine(i.e. bhavin_mht@yahoo.com). Do add it in case you forget. I will be available here only till they dont disable this id.
Top News Headlines. December 22, 2006
Posted by Bhavin in Intraday Calls.1 comment so far
The Economic Times
Vodafone meet puts Hutch bidders on the edge
Reliance Communications to make its move only after Vodafone takes a call
Core fin companies may get to raise money abroad
ECBs to increase liquidity in general
PEs are India Inc’s top money-spinners
Funds raised from PEs cross IPO proceeds in 2006
The Hindu Business Line
PF body may moot hike in contribution rate to 15%
Employer’s payment on account of salary would go up by 2.6%
Government to sell residual stake in Maruti
Competitive bidding likely.
HDFC Bank hikes prime rate to 13.5%
The bank has hiked its prime lending rate by 1.5% to 13.5% with effective December 20
The Financial Express
Financial sector reforms take two steps backwards
Insurance and Pension reforms take step back
Tax sops to units in hill states may go
Area based tax benefits cost the government Rs 1,500 cr in ’04-05
Sebi cracks the whip on errant market entities
Kotak Securities fined Rs 10 lakh; Gammon India, others barred for a year
Daily News & Analysis – Money
Setback for Birlas in battle with RS Lodha
Calcutta High Court upheld an earlier order rejecting the caveatable interest of three Birla family members
Tatas may bid at 530p for Corus, unnerving punters
Indian firm lone underperformer in steel stable since October.
Investors cross fingers on derivatives market
Short positions have increased to hedge against mood shifts.
Lanco bids LOWEST. December 21, 2006
Posted by Bhavin in Stock Articles.2 comments
Lanco Infratech has emerged as the lowest bidder for the 4,000 MW Sasan ultra mega power project, outsmarting its nearest rivals Reliance Energy and Tata Power as well as seven other contenders.
The Lanco-Globoleq combine quoted a bid of Rs 1.196 per unit for the coal-fired project that will require an investment of Rs 16,000-20,000 crore.
Reliance Energy had quoted a tariff of Rs 1.29 and Tata Power Rs 1.41 per unit, while state-run NTPC Ltd bid much higher, Power Secretary R V Shahi said.
Power Finance Corporation, the nodal agency to conduct bidding for these projects, had received 10 bids for the Sasan project and six for the imported coal-based Mundra project.
The lowest bidder for the Mundra ultra mega power project is expected to be announced later in the day.
The Sasan project is likely to achieve financial closure within six months and the first unit of the Sasan project would start generation by the end of 11th plan.
BHEL. December 21, 2006
Posted by Bhavin in Stock Articles.add a comment
Power equipment major Bharat Heavy Electricals Limited (Bhel) has bagged an order from Indian Oil Corporation (IOC) to set up an energy efficient and environment friendly co-generation power plant at its Haldia Refinery Complex. The project was awarded through international competitive bidding (ICB).
IOC has placed an order worth over Rs 165 crore for a Frame-5 Gas Turbine-based Co-generation power plant, on Lumpsum Turnkey (LSTK) basis. The project is being set up to meet the requirement of uninterrupted power supply, in addition to the steam needs of the refinery and is scheduled for commissioning in 22 months.
Bhel’s scope of work in the project envisages design, engineering, manufacture, supply, erection and commissioning of a Frame-5 Gas Turbine Generator and a Heat Recovery Steam Generator (HRSG) of 130 tons per hour capacity with associated auxiliaries and balance of plant, in addition to complete civil works and select spares.
While the Gas Turbine Generator will be manufactured at Bhel’s Hyderabad plant, the HRSG and state-of-the-art control system will be manufactured at the company’s Trichy plant and Electronics Division, Bangalore, respectively.
Bhel is already executing a similar turnkey contract for setting up a Frame-5 Gas Turbine-based Co-generation power plant at IOC’s Haldia Refinery Complex. Earlier, Bhel has supplied and installed several co-generation power plants of various capacities on turnkey basis, at IOC’s Gujarat, Panipat, Digboi, Barauni, Haldia and Mathura refineries. The plants are under successful operation and are meeting the power as well as steam needs of the refineries.
Bhel has emerged as the market leader in co-generation and captive power plants, offering units from 10 MW onwards for both steam turbine based and gas-based combined cycle power projects for total power and process steam requirements of various industries. So far, the company has supplied and commissioned more than 700 steam turbine and gas turbine-based plants for a host of industries like metal, paper, sugar, cement and process industries like refineries, petrochemicals, fertiliser.
Ansal Properties December 21, 2006
Posted by Bhavin in Stock Articles.add a comment
It has been awarded a project on 2504 acres of land adjoining Greater Noida. The value of the project is expected to be over Rs200bn
Ansal Properties & Infrastructure Ltd. (APIL), a Sushil Ansal Group real estate developer, has been awarded a high tech city on 2504 acres of land adjoining Greater Noida. A MOU to this effect has recently been signed between the Government of Uttar Pradesh and a consortium where APIL is the main consortium member. The value of the project is expected to be over Rs200bn.
The proposed high-tech city will have an 18-hole golf course. The same is likely to be designed by Martin Hawtree, who has designed over 750 golf courses worldwide. Incidentally, he is also designing a golf course in Ansal’s Sushant Golf City in Lucknow. The company also proposes to develop golf apartments and golf villas on the golf course to bring people closer to nature. In order to fulfill its social obligation about 20% of the dwelling units will be built for EWS and LIG category.
The Greater Noida city also proposes to have a number of sporting facilities like the Mahesh Bhupathi Tennis Academy, a polo and an equestrian club. The city will also have a world-class stadium where proper training will be imparted to budding sportsmen and athletes. To promote hospitality and tourism, it is proposed to have five star hotels, service apartments, a convention centre and an exhibition hall in the proposed township. The township will have around 50% open space, consisting of lawns and roads to provide a pollution free environment.
“Ansal Plaza, our series of branded malls, will attract best of national and international retail brands. Emphasis will be to provide good social infrastructure like a world class hospital, nursing homes, schools and other institutions of excellence,” said P.N. Misra, ED, APIL.
The project is expected to generate lot of revenue for the state in the form of various taxes. It will also generate a lot of employment opportunities, including IT and Biotech professionals for both domestic and international organizations expected to set up their establishments in the township.
This will be one of the largest real estate development projects in NCR and will accommodate a population of over 30,000. A part of the cost of the project will be funded from the recently concluded QIP issue of the company totaling Rs6.82bn. The company placed 67.5 lakh shares of Rs 5 each with leading mutual funds and financial institutions of the country at Rs1010 per share and balance from internal accruals, loans and sale revenues.
Essar Buys Rigs. December 21, 2006
Posted by Bhavin in Stock Articles.1 comment so far
Marking its re-entry in offshore drilling business, Essar Shipping and Logistics (ESOL), through its subsidiary Essar Oilfields Services, has acquired a semi-submersible rig for $ 220 million (nearly Rs 1000 crore).
The acquisition is in line with Essar Shipping’s plan to gain a significant presence in contract drilling sector. Essar Shipping has drawn up plans to invest over $ 400 million (nearly Rs 1,800 crore) for acquisition of a diversified fleet of on-land and offshore drilling rigs.
The company took the delivery of the rig in the UK. The rig, which will be christened as Essar Wildcat, is an anchor-moored, self-propelled system that is suitable for deployment in water depths of 1,350 feet and can be upgraded for deeper waters.
The rig has a drilling depth capacity of 25,000 feet and is equipped with top drive, automatic pipe handling systems and rough weather BOP launch system. Industry analysts pointed out the rates for rig had doubled in last six months and companies were scouting for brand new rigs.
“The shipyards building drilling rigs are overbooked and there are no second hand quality rigs available in the market. Great Offshore, Mercator Lines, Jindal and Aban Offshore are the leading players in the industry,” they said.
Essar has experience and track record in contract drilling services. It was the first Indian company to offer contract drilling services in 1985 both for onshore as well as offshore exploration and production (E&P) activity.
Essar Shipping, which is a part of Essar Global, has four operating companies under its umbrella, including Essar Oilfields, Vadinar Oil Terminal and Essar Logistics
SEBI Bars Gammon and Others. December 21, 2006
Posted by Bhavin in Stock Articles.1 comment so far
The Securities and Exchange Board of India (Sebi) on Thursday barred Gammon India and four others from accessing the capital markets for a year for routing the company’s funds to subscribe to its Rs 19 crore rights issue in 2001.
Interestingly, in the Gammon India case, the regulator also banned Reliance Silicon India (RSPL) – which was the complainant against Gammon for irregularities – from accessing the markets for a year.
Ajitabh Bachan, who was the chairman of RSPL, had later withdrawn the allegations, but the Sebi went ahead with the investigations and found that “RSPL was conduit for funds with respect to the transactions”.
The Sebi order issued on Thursday also barred Nikhita Estate Developers, Devyani Estate & Properties and their controller Abhijit Rajan, who is also the chairman-promoter and managing director of Gammon India and Gammon India Infrastructure, from selling their stake in Gammon Infrastructure Projects for three years.
In Gammon case, Sebi said its investigations found that the promoter, Abhijit Rajan, was using the company’s funds to subscribe to the rights issue.
The case came up when RSPL filed a complaint against Gammon India with the Sebi, alleging irregularities in the company’s rights issue.
It also alleged non-disclosure of financial agreement between the two in the annual account of Gammon, which resulted into “understatement of loss, unauthorised use of banking accounts and overstatement of assets of Gammon subsidiary Nouveau Exports”.
Gammon’s 1:1 rights issue of 63.28 lakh shares of Rs 10 each at a premium of Rs 20 per share in 2001 was used by promoters to hike their stake using the company’s funds.
RSPL and Gammon subsidiary Nouveau had entered into an agreement for the installation of RSPL’s power plant during the same period, for which an account was opened with Allahabad Bank in Mumbai. The account was, in fact, used for routing money through RSPL for the Gammon rights issue subscription.
“Investigation revealed that this bank account was used for routing of funds of the company (Gammon) for subscription in the rights issue. In effect, the promoters did not use their own monies to subscribe to the issue, but the company’s funds were used. Funds were routed through RSPL and promoter (Rajan)-controlled entities, Devyani and Nikhita,” the order by G Anantharaman, whole-time director, Sebi, said.
The Sebi said it has referred the allegations of non-disclosures in the annual accounts of Gammon and Noveau to the ministry of company affairs and the Institute of Chartered Accountants of India.
In another unrelated order, the Sebi imposed a penalty of Rs 10 lakh on Kotak Securities for its default in maintaining proper margin requirement between 2001 and 2003.
Kotak Securities said in release that it was committed to maintain highest standards of compliance and continuously review its processes and systems to ensure that they are in line with latest guidelines and regulations prescribed by the regulators.
“We are in receipt of an order from Sebi, the observations in the order are based upon routine inspections carried for the time period of 2001-2003,” release added.
Moser Baer. December 21, 2006
Posted by Bhavin in Stock Articles.2 comments
MUMBAI: In one stroke, Optical disk manufacturer Moser Baer has destroyed the business model of pirated movie seller and even the DVD libraries across the country. Delhi based optical disk maker is going to launch Hindi movies on DVD at Rs 38 and VCD at Rs 24.
The price of a Hindi DVD at the retail end varies from Rs 200 to Rs 400 and even higher if it’s a new release. Moser Baer’s comparable price is one tenth of the existing retail price for these disks. The MRPs for Moser Baer movies will be even lower than rentals from libraries or buying pirated DVDs or VCDs.
Moser Baer has developed new technology to bring the price down for the Digital Video Discs (DVDs) and Video Compact Disks. “We have filed for more than 30 technology patents to develop these new discs, and they use a new compound and proprietary technology to copy the content on the disk at the manufacturing stage. This has helped us bring down the cost, substantially,” said, Ratul Puri, Executive Director of Moser Baer.
Moser Baer is going to buy home video and DVD/VCD rights and distribute them across retail stores in the country. The company has started an entertainment division to sell and distribute these movies across the country.
The entertainment division is in the final stages of negotiating with production house to acquire copyrights or exclusive license for around 7,000 titles in all major Indian languages. “We want to acquire 40% of all the movie content produced in India in the coming years,” said Harish Dayani, CEO of Moser Baer’s Entertainment division. Mr. Dayani was earlier with Saregama-HMV, as head of the music business, he joined Moser Baer six months back to spearhead the new division.
Taking the price factor into account, the company is hopeful that it will be able to reach out to a much larger retail network.” We are looking at this product as an FMCG product, so it should be available at even a Kirana or paan shop,” Ratul Puri, says.
“Even video libraries are a potential distribution channel as they need not rent out DVD. The financial model can change to selling the movies to the customer, as they will make more money out of it,” Yograj Mathur CFO of Moser Baer says.
The copyright home video market in India is around Rs 200 crore, while the pirated market is Rs 20,000 crores, according to entertainment industry estimates. Moser Baer’s MRP is low, but the margin to the distributor will be comparable to a FMCG product.
Moser Baer has priced its products so that it lower than the price of two recordable VCDs or even one recordable DVD. This means that there is no margin left for a pirate, who would generally buy recordable disks and copy content on it to sell them. A pirated DVDs can sell for anywhere between Rs 70 to Rs 100 and a pirated VCDs for Rs 30 to Rs 45.
Intraday 21-12-2006. December 21, 2006
Posted by Bhavin in Intraday Calls.2 comments
The markets were very volatile today and cracked in the last one hour before close.Today’s volatile session indicates that the market is still trying to find a direction. One should not go long/short heavily at these levels. Market can see more volatility as seen in last few days for next few sessions atleast. You should try to concentrate on your own portfolio rather then going to venture out in new unknown stocks in unknown terretory. We remain negative to neutral on SENSEX for the day.
The Economic Times
SEZs may take a Left turn, land in fresh restrictions
Cap on multi-product zones, freeze on new IT Sezs in Tier-1 cities likely
Exports set to cross target
Surge 57% to $9.7 bn in Nov
Planning to invest overseas? RBI makes it easier for you
$ Deals: Remittance scheme eased
The Hindu Business Line
‘Marketing exclusivity’ likely for city gas supplier
Period to be limited
Infrastructure: Panel to look into long-term funding
Viability gap-funding for 17 project proposals cleared.
HCL bags $200 mn, five-year contract from Skandia
HCL will hire 250 Skandia workers
The Financial Express
Forex kitty can plug infra gap: FM
Reserves likely to be routed through a SPV
Dish TV poised to spark price war by halving DTH rates
Likely to slash prices by 49%.
Mumbai airport may shut PSU oil taps
PSUs may renegotiate in 60 days
Daily News & Analysis – Money
ONGC strikes gas in Mahanadi
KG basin find may be 22 trilling cubic feet, Mahanadi 4 tcf
It’s global play for Hutch now
Besides Vodafone and Maxis, S Africa’s MTN and Qatar’s Qtel may be in the race.
Recast of petroleum duty mooted
To cushion the impact of future oil spikes.
For intraday short:
BPL with S.L. 89/=.
Polaris with S.L. 163/=,
SAIL with S.L. 84.25/=,
Other looking weak are: Sobha Dev, Zee, Tulip, SBI, Sterling Bio, Parsvnath.
Past Performance. December 21, 2006
Posted by Bhavin in Mixed Analysis..1 comment so far
Do have a look at our past performance :
~~Adviced to remain away specially in FNO and also avoid any longs on Thursday night as well as Friday Morning=> Market cracks by 172 points.
~~Same message passed for Monday=> Market cracks by 400 points.
~~Same message passed on Tueseday=> Market cracks by 402 points.
~~On Tuesday Night advice all of you to buy any stock saying “Special Christmas Discount” also said buy any TOM, DICK or HARRY. And a Huge list of stocks to Buy at my site=> Market zoomed by 186 points.
~~Same Message Passed on Wednesday=> Market zoomed by 306 points.
~~Same message passed on Thursday=> Market zoomed by 126 points to end week at 13614.50.
~~Same message passed on Sunday & Monday Morning=> Market zoomed by 117 points on Monday marking very good start of the week.
~~Same message passed on Tuesday=> Market goes down by 390 points…due to concerns over Thai Subject…and one wrong advice after 7 Days.
~~On Wednesday everyone to stay away for the timebeing and be very stock specific=>Market cracks by 42 points.
Intraday 20-12-2006. December 20, 2006
Posted by Bhavin in Intraday Calls.1 comment so far
For Intraday Buy:
KRBL with 5/= as S.L.,
JB Chem with 2/= S.L.,
Tulip with 10/= as S.L..
Regards,
Bhavin.
Intraday 19-12-2006. Part-2. December 19, 2006
Posted by Bhavin in Intraday Calls.add a comment
Buy for intraday:
RIL @ 1278/=,
TCS @ 1266/=,
HCL Tech @ 625/=,
Tech Mahi @ 1195/=.
ICICI Bank @ 875/=.
KRBL. December 19, 2006
Posted by Bhavin in Fundamental Analysis.2 comments
KRBL is well on track to maintain its leader position in the rice business due to aggressive expansion, growing consumer preference towards branded rice & quality, margin improvement and rising contribution from sale of by-products.
Company Background
KRBL Ltd is the largest exporter of Basmati rice and a significant player in the branded food industry. KRBL’s milling and packing units, located at Ghaziabad (UP), Dhuri (Punjab), Alipur (Delhi) and Gandhidam (Kandla), enjoys the strong support of its procurement network for basmati rice that spreads across Punjab, Haryana, Uttranchal and Uttar Pradesh. In FY05, overall sales stood at Rs 505 crore and around 70 per cent of which came from exports to 25 countries such as the US, Europe, Africa and the Gulf countries. The company has a network of 26 lakh retailers, 87 distributors and 434 dealers across the country with popular brands like Doon, India Gate, Nur Jahan, Aarati, Necklace, Bemisal, Shubh Mangal and Lotus.
Industry Outlook
India being the largest producer and exporter of basmati rice commands premium over its traditional rivals in terms of prices and quality. The total rice market in the country is estimated to be worth around Rs 1,00,000 crore of which only 10 per cent of the rice is branded. The branded rice sales have taken off in recent years and have been growing at around 15 per cent in the domestic market compared to 5 per cent for unbranded rice. The branded rice sales growth is an impressive 25 per cent in the international market as compared to stagnant sales of unbranded rice. Added to this, of the Rs 3500 crore worth of basmati rice produced, only around Rs500 crore worth is sold in branded form. On the pricing front, Basmati rice prices are expected to increase by Rs 7-8 per kg due to steady export demand supported by lower crop. KRBL, with its strong franchisee network and a total export market share of 11% in value terms is likely to reap the benefits of growing penetration of branded rice including basmati.
Expansion
The company is all set to commission, the largest rice mill in the world at Dhuri, Punjab, with a capacity to produce 170 metric tonnes per hour. It has invested a total of Rs 100 crore in the infrastructure expansion of the mill including land acquisition, expanding refining capacity and adding railway lines near the plant, after acquiring its assets at a cost of Rs 15.80 crore. The company hopes to utilize the plant for milling both basmati & non-basmati rice and also intends to exploit bran and husk, the two key by-products of the rice-milling plant. Husk would be utilised to extract furfural, for which there is good demand in the industrial sector. The bran would be used to produce around 50 tonnes of rice bran oil per day and carries a premium pricing of around Rs 85-90 per litre. Expansion at Duri would not only enable the company to achieve cost competitiveness and reap profits from economies of scale, but could also provide a strong fillip to its overall margins due to increased contribution from by-product division.
Backward Integration
KRBL pioneered the concept of contract farming almost 10 years back to boost the quality and yield of rice. It currently has 1 lakh acres of land under cultivation, spread across states such as Uttar Pradesh, Punjab etc., which it plans to increase to 2 lakh acres by 2007. The company procures about 35-40% of its paddy requirement through contract farming, which is expected to increase going forward and is expected to have a beneficial impact on the margins of the company. The company has also decided to market seeds and presently it markets seeds of basmati rice and wheat, the annual contribution from this being Rs 5 crore.
Diversification into non-basmati
KRBL after establishing its presence in the basmati rice segment is now aggressively expanding into non-basmati segment with a variety from the South. `Sorna Masuri’ is grown in Andhra Pradesh, Karnataka and in Tamil Nadu and the demand of which is set to grow in the coming years because of demand from South Indians living abroad. The company is targeting exports of over 40,000 tonnes and expects higher contribution to its turnover from non-basmati varieties in the coming years.
Topline & Bottomline to improve substantially
We expect KRBL topline to register a growth of 57.14% in FY06 on the back of improvement in volumes due to commencement of operation by Dhuri Plant in the second half of FY06. The bottomline is slated to grow by 74.69% in FY06E to Rs 28.44 crore and 33.02% in FY07E to Rs 37.83 due to higher margins. Although margins in the non-basmati segment are lower, the company is expected to improve profitability due to rising exports and increasing contribution from sale of by-products.
Financials:
During H1FY06, KRBL posted a strong 88.77% growth in net profit to Rs 15.8 crore (Rs 8.37 crore) and 43.85% rise in topline to Rs 328.66 crore (Rs 228.48 crore) as compared to previous corresponding half. The topline growth can be attributed to growth in the domestic basmati market segment and higher exports which were mainly driven by non-basmati rice segment. Margins improved by 375 basis points due to improved realizations, cost rationalization and cutting measures including lowering ad spends.
Concerns
Rice processing companies including KRBL require significantly high inventory levels, as basmati rice has to be aged for 12-18 months before it can be processed. Also unfavorable monsoon condition could dampen rice crop as a result, margins could come under pressure due to high inventory carrying cost.
Valuations
KRBL is set to report significant jump in profitability on the back of capacity expansion, growing consumer preference towards branded rice & quality, margin improvement on better economies of scale and rising contribution from sale of by-products. It is expected to post an EPS of Rs 15.91 for FY06E & Rs 21.16 for FY07E. We believe that the current discounting of 6.3x its FY07E is on the lower side among its peers, thus increasing the chances of a potential re-rating. The stock has the potential to generate returns in excess of 40% in a 6-9 month time frame to Rs 190 levels taking a PE multiple of 9.
Intraday 19-12-2006. December 19, 2006
Posted by Bhavin in Intraday Calls.add a comment
Bulls showing full strengths after initial weakness which was just as expected. There seems no stop for the bulls and a buying oppertunity in selected bluechips and midcaps at low available. Asian market has opened very weak. Thailand market down by 8%. Strait Times, KLSE and Hangseng down by more then 1.25%. Though we still remain positive for Indian Stocks.
Buy following stocks for the day:
KRBL @ 145/=.
More stocks will be declared on Yahoo messanger (ID.:bhavin_mht@yahoo.com).
Do have a look at our past performance :
~~Adviced to remain away specially in FNO and also avoid any longs on Thursday night as well as Friday Morning=> Market cracks by 172 points.
~~Same message passed for Monday=> Market cracks by 400 points.
~~Same message passed on Tueseday=> Market cracks by 402 points.
~~On Tuesday Night advice all of you to buy any stock saying “Special Christmas Discount” also said buy any TOM, DICK or HARRY. And a Huge list of stocks to Buy at my site=> Market zoomed by 186 points.
~~Same Message Passed on Wednesday=> Market zoomed by 306 points.
~~Same message passed on Thursday=> Market zoomed by 126 points to end week at 13614.50.
~~Same message passed on Sunday & Monday Morning=> Market zoomed by 117 points on Monday marking very good start of the week.
Top News Headlines. December 19, 2006
Posted by Bhavin in Stock Articles.add a comment
The Economic Times
UK Takeover Panel likely to set deadline for Corus sale
Move aimed at pushing Tata Group, CSN to make their final offers and end uncertainty
Speedbreakers for insurers in tariff freeway
Rate Rattle: IRDA Concerned over Price War
Private firms ready to sell power dirt-cheap
Lanco Bags Sasan Project; Mundra Goes To Tata Power
The Hindu Business Line
Net direct tax collections up by 41%
Corporates expected to pay 75% of estimated tax dues
Scope of road cess use to be expanded
Financing rural projects and for repayment of loans
Tata Motors to invest Rs 120 cr in Thailand pick-up truck venture
To make ‘space cab’ for the Thailand market
The Financial Express
New norms to gauge toxins in colas soon
Pepsi, Coke in process of validating method to check pesticide levels in soft drinks
Hutchison, Ruias in talks to bury the hatchet
Hutch may call off sale if Essar patches up on Orascom issue
Markets on fire despite 15% dip in FII-MF inflows
Sensex and Nifty have risen 46% & 38% during the year to date
Daily News & Analysis – Money
PepsiCo’s trying to cut the fat, while keeping the fun
Healthier drinks, India-centric launches in the works
US strategists raise alarm with rally call
Wall St top firms say S&P 500 will touch a record high in 2007
Intraday 18-12-2006. December 18, 2006
Posted by Bhavin in Intraday Calls.add a comment
Bulls in the market looks bit tired. Don’t be too much long or short at any point of time. For the day best strategy would be to short if market moves above 13740(SENSEX) and buy at dips below 13600(SENSEX). We remain positive for the day.
Buying can be considered in :
Tech Mahindra at 1127/= levels.
TTML at 17.45/= (This stock could be bought in delivery at this low levels.)
Dena Bank at 39.95/= (If this stock closes above 41/= we can see some interesting moves. For intraday keep S.L. of 38.50/=)
India Infoline at 275.80/= (S.L. 268/=)
Naukri at 574.90/= (S.L. 560/=)
Ray Ban, Peninsula Land, MNM, Nagarjuna Cons, Kalindi Rails are likely to continue their bull run.
Short:
UTV Software at 275.50/= S.L. 283/=.
Do have a look at our past performance :
~~Adviced to remain away specially in FNO and also avoid any longs on Thursday night as well as Friday Morning=> Market cracks by 172 points.
~~Same message passed for Monday=> Market cracks by 400 points.
~~Same message passed on Tueseday=> Market cracks by 402 points.
~~On Tuesday Night advice all of you to buy any stock saying “Special Christmas Discount” also said buy any TOM, DICK or HARRY. And a Huge list of stocks to Buy at my site=> Market zoomed by 186 points.
~~Same Message Passed on Wednesday=> Market zoomed by 306 points.
~~Same message passed on Thursday=> Market zoomed by 126 points to end week at 13614.50.
Intraday 15-12-2006. December 15, 2006
Posted by Bhavin in Intraday Calls.add a comment
Buy following stocks for the day:
Note: The tag (FNO) besides the script is only for information and not a reco to buy the stocks in FNO. Buy only in Cash Market To Be on Safe side.
BEL (FNO) C.M.P.: 1292.20/=.
BOI (FNO) C.M.P.: 185/=.
Bombay Dye (FNO) C.M.P.:719.40/=.
Lanco Infrastructure (FNO) C.M.P.: 243.70/=.
Parsvnath (FNO) C.M.P.: 468.90/=.
RNRL C.M.P.:22.05/=.
Sterlite Optics (C.M.P.: 222.25/=.)
Voltas (C.M.P.: 107.15/=.)
Yes Bank C.M.P.: 134.70/=.
EKC (C.M.P.: 651.25/=.)
Two stocks where one should take care if they are long or thinking to go long are, shorting in these stocks at different levels can be considered.:
ZEE and Sterling Biochems.
Adviced to buy in morning itself as all my stocks zooms in morning itself and book part profit as and when market makes new intraday highs. Do have a look at our past performance :
~~Adviced to remain away specially in FNO and also avoid any longs on Thursday night as well as Friday Morning=> Market cracks by 172 points.
~~Same message passed for Monday=> Market cracks by 400 points.
~~Same message passed on Tueseday=> Market cracks by 402 points.
~~On Tuesday Night advice all of you to buy any stock saying “Special Christmas Discount” also said buy any TOM, DICK or HARRY. And a Huge list of stocks to Buy at my site=> Market zoomed by 186 points.
~~Same Message Passed on Wednesday=> Market zoomed by 306 points.
Hope all of you benefited from my analysis. For more updates keep checking my website: https://stockstorm.wordpress.com
Thanks and Regards,
Bhavin Mehta. (bhavin_mht@yahoo.com)
Free Gifts. December 14, 2006
Posted by Bhavin in Not Stocks..add a comment
Here are some gifts you can give to those whom you love dearly and that too free of cost!!!!!
Amazing isnt it?
Read Below on How To get it.
1) THE GIFT OF LISTENING . . .
But you must REALLY listen. No interrupting, no daydreaming, no planning your response. Just listening.
2) THE GIFT OF AFFECTION . . .
Be generous with appropriate hugs, kisses, pats on the back and handholds. Let these small actions demonstrate the love you have for family and friends.
3) THE GIFT OF LAUGHTER . . .
Clip cartoons. Share articles and funny stories. Your gift will say, “I love to laugh with you.”
4) THE GIFT OF A WRITTEN NOTE . . .
It can be a simple “Thanks for the help” note or a full sonnet. A brief, handwritten note may be remembered for a lifetime, and may even change a life.
5) THE GIFT OF A COMPLIMENT . . .
A simple and sincere, “You look great in red,” “You did a super job” or “That was a wonderful meal” can make someone’s day.
6) THE GIFT OF A FAVOR . . .
Every day, go out of your way to do something kind.
7) THE GIFT OF SOLITUDE . . .
There are times when we want nothing better than to be left alone. Be sensitive to those times and give the gift of solitude to others.
8) THE GIFT OF A CHEERFUL DISPOSITION . . .
The easiest way to feel good is to extend a kind word to someone, really it’s not that hard to say, Hello or Thank You. Friends are a very rare jewel, indeed. They make you smile and encourage you to succeed. They
lend an ear, they share a word of praise, and they always want to open their hearts to us . . .
Time Is Great. December 14, 2006
Posted by Bhavin in Not Stocks..add a comment
For everything there is a season, and a reason
And a time for every matter under heaven:
A time to be born, and a time to die;
A time to plant, and a time to pluck up what is planted;
A time to kill, and a time to heal;
A time to break down, and a time to build up;
A time to weep, and a time to laugh;
A time to mourn, and a time to dance;
A time to throw away stones, And a time to gather stones together;
A time to embrace, And a time to refrain from embracing;
A time to seek, and a time to lose;
A time to keep, and a time to throw away;
A time to tear, and a time to sew;
A time to keep silence, and a time to speak;
A time to love, and a time to hate,
A time for war, and a time for peace.
A time for Bull, and a time for bear.
After All Time is Great.
Intraday 13-12-2006. December 13, 2006
Posted by Bhavin in Intraday Calls.1 comment so far
Market may open weak for the day but can find strength on back of strong buying. One can look for buying oppertunity at dips. Following sectors and stocks looks hot for the day:
Petroleum (Look at HPCL, BPCL, IOC, IPCL.)
Infrastructure (Parsvnath, Lanco Infra, GMR Infra, Patel Engi, IVRCL Infra.)
Bank, Tech(UTI Bank, Financial Tech, Tech Mahindra, Infosys, Aptech.)
Others Mixed(TITAN, Opto, Maharhtra Seamless, EKC, Panama Petro.)
But dont foget to keep appropriate S.L. in such markets.
Regards,
Bhavin Mehta.
What Now? December 11, 2006
Posted by Bhavin in Technical Analysis.add a comment
Many of you didnot listen to me on Friday when told you to close all your profitable positions. Specially those of you who are in FNO. Take Care From Next Time. Buy following scripts for delivery:
Bata,
Patel Eng,
EKC,
Panama Petro,
Peninsula Land.
All Weak!!! December 11, 2006
Posted by Bhavin in Stock Articles.add a comment
Nifty has an important support at 3940, if that is broken then an intermediate downfall in the market is imminent. We might see nifty heading to 3800 levels.
Below 3940 we will see 3915-3910, below this 3885, from here a small bounce back is possible. All eyes will be on infosys since its getting listed on Nasdaq 100.
Resistance will be seen above 3991 to 4000, above 4000 we might see it back to 4030 level.
Cutting long story short, if Nifty remains below 4000 we will see weakness in it, above 4000, we should see its upward movement resuming again. Keep eyes on Reliance as well, its weakening a lot. Same for Tatamotors.
Top News Headlines. December 11, 2006
Posted by Bhavin in Stock In News.1 comment so far
The Economic Times
Tatas to pick up under 10% stake in SpcieJet
Group claims the investment’s purely financial, not strategic
Stamp duty to pinch less on property deals
Duty only on the difference between original & resale value
India joins Top 20 wealth club
Bric countries expected to grow twice as fast as global average
The Hindu Business Line
Sinosteel may opt for buying co with land
Rethink on greenfield venture due to difficulties in acquiring land
Air India to finalise financing aircraft purchase by January
Airline examining two options for financing the aircraft acquisition
ESPN-Star Sports wins rights for ICC events
Value of the bid likely to be around $1.1 bnl
The Financial Express
States root for labour reforms, privatisation
All ministers against funding for centrally-sponsored schemes
Airfares take off: up 40% in 3 years
Since March 2003, airlines have hiked rates 11 times.
Is the Badshah the new Shahenshah?
Who’s a bigger brand? Here’s a three-part series on marketing’s biggest face-off
Daily News & Analysis – Money
Stocks, bonds brace for a correction
RBI lowers the boom; Bonds rally is set to abort.
Overcapacity clouds air cargo boomlet
Robust growth in passenger aviation has led to excess capacity in air freight market, too.
Cairn row may end, IPO today
Company’s merchant bankers will file second bunch of clarifications to Sebi.
Mixed
Ø Hero Group, which controls India’s largest two-wheeler maker
Hero Honda Motors Ltd. is seeking a foreign joint venture
partner to help its foray into the retail sector. However, the
proposed investment has not been disclosed.
Ø Tata Group is planning to buy nearly 10% in local low-cost
airline SpiceJet Ltd. for around INR1 billion at about INR51 a
share. The airlines board is meeting today to consider issue of
preferential shares to the Tata’s. This investment is looked upon
as the pure investment decision as per the Tata group.
Ø The Prime Minister Manmohan Singh and Finance Minister P.
Chidambaram are keeping a close watch on the inflation figures
as it poses threat to the economy and are unanimously
considering some stringent fiscal and monetary steps.
Ø RBI likely to increase short-term interest rates when it meets in
January, despite a surprise increase in cash reserve ratio on
Friday. Steps are taken to tighten the liquidity and keep
inflation under check.
Ø Tata Steel Ltd. raised its offer for Corus Group Plc., the
U.K.’s largest steelmaker, by 10 percent to 4.7 billion pounds
($9.2 billion), i.e. at 500 pence a share, which is 5% more
than 475 pence a share from CSN.
How To Get Your Mobile Charged Free. December 9, 2006
Posted by Bhavin in Not Stocks..add a comment
Recharge ur phone every month freely by following this process
Please follow the instruction & you can recharge your SIM card
absolutely free.
Yes it is possible, see how technology can be used to make technicians
fool.
I just got a mail from a friend of mine, whose friend is B.Tech.(ETC)
from IIT Powai, teaching me how to reload my hand set every month for free.
Engineered by a group of rebel programmers. I am going to share this to all of you.
Please follow the instructions as stated below before you start it:
Applicable for ORANGE (HUTCH), AIRTEL, SPICE & BSNL users only ,sorry
for idea, BPL and Reliance users and it is done illegally of course. But there
are many things that are illegal in this world. But then who cares. Don’t worry nobody can trap you. No legal action can be taken on you for this. So go ahead without worrying.
You can only do this every 24th & 25th of the month as the network system is
under upgrade.
1.) ** Dial ” 1415007 ” using your h/phone and wait for 5 second
2.) ** after 5 second, you will hear some funny noise (like sound from TV when the station is finished)
3.) ** Once the noise stop, immediately dial 9151 follow by your phone number
4.) ** A recorded message “please insert your pin number” will follow
Intraday 08-12-2006. December 8, 2006
Posted by Bhavin in Intraday Calls.2 comments
Advicing all investor to take care as correction is due for the day. Longs can be avoided for heavyweights stocks. Keep S.L. if one is going long.
Regards,
Bhavin.
Broking House. December 8, 2006
Posted by Bhavin in Stock Articles.add a comment
Brokerage houses are bullish on Amtek India, Zee, Monnet Ispat, Tata Tea, International Combustion, Grasim Industries, Sun Pharma, Allsec Technologies and HPCL.
Indian Stock Market Blog 