Concentrate on Mid caps in volatile period

Indian markets will trade in volatile zone due to exponential growth in sectors like Construction, Engineering, Telecom and Banking while weak growth in IT, Textiles, Sugar and Auto sectors. Biggest worrying point is high growth sectors are trading at high valuations while low growth sectors will feel the heat for another 2-3 months. So concentrate on Individual stocks of high growth sectors which are trading at attractive valuations. Risk taking investors can try in sound stocks like Reliance Capital, Dr Reddys, Reliance Communications, GMR Infra and Reliance Energy.

Global cues: US markets are in volatile zone due to good earnings and bad subprime market.

Sector of the day: FMCG.

Stock of the day: Reliance Industries – Court verdict on gas.

Significant News:

1. Indian stocks will fall on account of weak earnings and high valuations – HSBC.
2. BSE Sensex will touch 16,000 by the end of this year – Citi group.
3. Bombay high court will give verdict on RIL gas today.
4. Moody assigned stable rating for Indian banks.

Rumour:

1. Entegra may come with rights issue in 2-3 months.

Stock advice:

1. Stock markets will continue to fall as most of the companies will fail to justify their valuations.
2. Prajay Engineers, Dr Reddys, HCL Tech are few stocks that will beat analysts’ expectations. Satyam is the dark horse.
3. NTPC is the safe bet for short and long term investors on account of massive investments and bonus rumours. Target for short term investors is Rs 180.
4. It may be difficult to expect exceptional returns from GMR Infra at this level.
5. KS Oils is counting on its massive gains ahead of stock split.
6. Praj Industries is struggling due to F&O ban ahead of bonus issue.
7. Deccan Aviation will touch 150 within 3-4 trading sessions.
8. Even though UTI Bank will announce good results, valuation are little bit stretched.
9. Dena bank may continue its upward journey.
10. CMC is the one of the rare stocks looking good in IT space on the back of to be announced results. Profit booking will be seen after results.

Positive stock news:

1. Unilever may be taken over by Colgate. Watch out HUL and Colgate.
2. Dabur foods will merge with Dabur India.
3. Megasoft bought Boston Communications for $65 million.
4. Cipla became the number 1 company in domestic retail market overcoming Ranbaxy.
5. Dr Reddys launched Glimmy MP1& MP2 diabetic drugs.
6. Bajaj auto finance will enter into truck business by October, 2007.
7. Chennai petro announced good results.
8. Country club announced wonderful results.
9. Sintex Industries announced 54% rise in net profit.

Negative stock news:

1. Infosys missed its guidance first time in 14 years due to rising rupee. It failed to estimate the rupee impact in March and gave wrong guidance to investors. Infosys lowered its guidance by 5-8%.
2. 14 public sector banks will lose around Rs 930 crore due to RBI guidelines on IFCI investments.
3. Bajaj Auto will announce disappointing results today and stock may lose once again.
4. S&P lowered Tata steel’s credit rating from BB to BBB.
5. iGate solutions posted disappointing results. More such news will come in this quarter.

Best stocks for day traders and investors:

1. HUL and Colgate.
2. Dabur India.
3. Geojit Financial services – with risk.
4. Pyramid Saimira – Good results.
5. Dr Reddys Labs – Momentum is strong.
6. Chennai Petro – Good results.

Results today:

1. Bajaj Auto, UTI Bank, Technocraft India, Reliance Infrastructure, Geojit Financial services and Pyramid Saimira.
c
Please share your views and advice on Indian stocks.

Business world issue on India’s most respected companies

Business world magazine has released special issue on India’s most respected companies. Investors should read this magazine as it gives an idea about the various companies from insiders.
Most respected companies:

1. Automobiles – Maruti Udyog, Tata Motors
2. Auto Ancillaries – MRF, Bharat Forge
3. Banking – ICICI Bank, Citibank
4. BPO – IBM Daksh, Infosys BPO
5. Consumer durables – Nokia, LG
6. FMCG – HLL, Britannia
7. Food Retail – Mc Donald’s, Café Coffee Day
8. Infrastructure – Tata Steel, L&T
9. Insurance – LIC, ICICI Prudential Life Insurance
10. Information technology – Infosys, Microsoft India
11. Media & Entertainment – NDTV, Bennett, Colemon & Co
12. Petroleum – Castrol, HPCL
13. Pharma – Ranbaxy, Cipla
14. Retail – Shopper’s Stop, Reliance Retail
15. Telecom – Bharti Airtel, Reliance Infocomm
16. Textiles – Raymond, Arvind Mills
17. Travel – Indian hotels, ITC Hotels

Long term investors may invest in the following companies:

Apollo Tyres, Castrol, Cipla,
Dabur India, TATA Teleservices

NDTV, Arvind Mills, Ranbaxy
Indian Hotels and TATA Motors.

Shares like Arvind Mills are quoting at attractive prices.

Most respected companies list provides an insight into what is happening in corporate India. These companies are rated high by the insiders. It is a measure of their credibility which is vital for the long term growth of the companies.

Magazine highlighted the fact that these companies will find it easy to hire the best talent. Their customers feel secure buying their products; their employees feel proud working for them. These attributes are necessary for the growth of any company.

Read more.