New blog on Indian Stock markets

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http://www.stockmarketguide.in/.

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New IPO News: Gammon Infrastructure

Gammon Infrastructure is priced aggressively with unreasonable valuations. This IPO is only for risk taking investors. The promoters valued it 3 times more than infrastructure giant Larsen and Toubro. These promoters have not learnt lessons from Reliance Power IPO.

My rating: 3/5. Stay away from Gammon Infrastructure IPO.
IPO Grade: 4/5 by CARE. About Gammon Infrastructure IPO:

Price band: Rs 167-200.
IPO duration: March 10 – March 13.
Total Number of shares: 16.55 lakh shares.
Face value: 10.

About IPO application:

1. Retail investors need to pay only Rs 50 per share per application. 30% of issue is allotted to retail investors.

2. NRIs need to pay full amount.

3. QIBs need to pay only 10% of the amount.

Strong points:

1. It is the infrastructure filed which has good growth prospects.

Negative points:

1. Company’s management reputation is not good.
2. Very high valuations.
3. Bad market sentiment.

Gammon fundamentals:

Net profit: Rs 29.85 crore.
Total Income: Rs 158.8 crore.

Stay away from Gammon Infrastructure IPO.

Please share your opinion.

Reliance Money launches financial mobile portal

Reliance Money, online trading platform of Reliance Capital, will soon launch a mobile financial portal in alliance with Webaroo Inc. to give complete financial information for 200 million mobile users without any fee. This facility will be available for free for both GSM and CDMA users. This is the first financial service to provide free information for all mobile users. Customers of Reliance Money can access portfolio, trade book and order book through this mobile financial portal. Mobile users now get free mobile alerts on key financial matters through this service. This will help Reliance Money to reach more users and may soon become No.1 online trading portal. Reliance Money wants to expand the current 3,237 outlets to more than 10,000 by the end of 2007-08.

Reliance Money earlier acquired “TravelMate”, to enter the money changing business. Reliance Money wants to become the largest vendor of gold coins in the country. It seems to have very big plans on the untapped retail category. It will be difficult for small companies to face this onslaught from Reliance Money in trading business. It is already very popular among customers due to its low brokerage charges. Reliance Money was selected as the safest and cost efficient trading platform in the recent survey.

Note: My sincere apologies to all the regular readers for not updating this blog. I will start regular postings from Monday onwards. I am happy as my favourite stocks like IFCI, TFCI, Ispat Industries, Praj Industries and R-com gave me very good returns. I missed Mercator Lines due to delay in taking quick decision. I have partially sold my shares in IFCI, TFCI and Reliance Communications. I will hold Ispat, Fortis and Dish TV shares for another 2 years. Short term outlook for markets is negative but long term view is very good. Book profits in BHEL and Reliance etc.

I will update with more detais on the Reliance Money Financial portal in the coming days.

Stocks rebound temporarily

Indian stocks will see sharp temporary rebound on the account of strong global cues. Sustainability of this rise will depend on future course of global markets.

Market movements: Dow Jones gained 286 points after initial volatility and Asian markets are rising from global cues. Indian markets will follow their global peers. Global markets are in a precarious situation. It is not an ideal time for retail investors to take short positions in markets. Stay away from futures and options. BSE Sensex may settle around 14,300-14,500 and Nifty at 4,100-4,200 in the near term. Take positions in over corrected stocks.

1. BSE Sensex:
CMP: 14903.
Target: 15060.

2. NSE Nifty:
CMP: 4339.
Target: 4403.

Positive Stock News:

1. Hindustan Unilever will announce winners of bids for real estate projects in Bengaluru and Mumbai on next Tuesday.
2. Wal-Mart and Bharti enterprises announced 50-50 joint venture for retail.
3. Bharti Airtel received LOI for DTH service and will launch its DTH services by March 2008.
4. Hindalco and Tata Power will jointly develop a coal block in Jharkhand.
5. Government should approve gas price before marketing – Cabinet secretary.
6. GVK Power announced financial closure for its Uttarakhand project.
7. Strides Arcolab acquired Italian company.

Negative Stock News:

1. Novartis lost Glivec case and will not appeal.
2. Surge in International crude oil price is a real concern.
3. Volumes are declining gradually in the last three days.
4. Sales of Ashok Leyland were down by 19% in July.
5. DCM Shriram announced massive loss in its Q1 results.

My Stock views:

1. FIIs are selling in a big way while Domestic institutions are using this opportunity to accumulate. Mutual funds are waiting in the sidelines.
2. Don’t underestimate the impact of US Subprime market. Global markets are closely interlinked in these days. FIIs will spoil in Indian party in the coming days but long term story is intact. Accumulate good stocks on every dip.
3. Sugar stocks will temporarily rise in this week due to disruption of supply (heavy rains).
4. Indian Real estate stocks are the most expensive ones. Accumulate DLF in the 500-530 range for long term investment.
5. Oil refining companies will announce surprise results in the next quarter due to earning s from oil bonds. Accumulate these companies.
6. I think stocks like Suzlon and Sterlite are over corrected due to weak earnings but its long term prospects are good.
7. Acquisition of Infocrossing by Wipro will benefit it in the next financial year.
8. If rupee stabilizes due to weak markets and RBI measures, IT stocks will see some contra buying.
9. Accumulate Sesa Goa and Mount Everest as promoters will announce open offers in the coming days.

Best Stocks for Day Traders:

1. Bharti Airtel: Wal-Mart, DTH, Google tie-up news.
CMP: 866.
Target: 878 and 889.

2. IFCI: If it breaks 64 (strong resistance).
CMP: 63.7
Target: 65.7 and 67.6

3. Reliance Communications.
CMP: 531.5
Target: 538 and 546.

4. GVK Power.
5. DLF, HDIL and GMR Infra may bounce back.
6. Hindustan Unilever.

Please share your views on my stock views.

Black Monday for Indian Stocks

Indian stocks will suffer heavy selling due to weak global markets especially US and Japan. Volatility and range bound sessions will continue in this week. Investors should closely watch the movements of sound stocks like SBI, R-Com, DLF, REL and GMR-Infra Etc to accumulate at attractive price. IFCI, ITC and Hindustan Lever are some stocks that are looking strong with some risk in these volatile markets.

Conservative investors should stay away from Indian share markets for some more time. Traders may have money making chances in these range bound sessions. Indian markets will follow global markets especially US, Japan and China.

Indian Stock Market Movements:

Indian stocks will lose heavily due to weak sentiment in global markets. They will range bound tomorrow if US markets will end on positive note on Monday evening. Risk taking investors may buy in the late session for quick returns on Tuesday. Markets will continue its volatile run. Don’t take long term calls in major stocks and stay away from futures and options.

1. BSE:
CMP: 15138.
Target: 14885.

2. NSE:
CMP: 4401.
Target: 4294.

Courtesy: Bloomberg.

Significant Views:

1. India will be among the top 3 global powers by 2050 – World Economy study.
2. India is the fifth most preferred business destination – World Economy study.

Significant event: Us federal bank meeting on Tuesday.

Positive Stock News:

1. Anant Raj Industries is going for stock split.
2. IFCI board approved 26% stake sale.
3. Reliance has big plans on semiconductor space. It will also invest $ 14 bn in the oil business.
4. Sun TV will launch Sports and Documentary channels. Accumulate this media heavy weight in the 430-450 range for long term benefits.
5. Reliance Communications will launch money transfer scheme through its mobile retail outlets.
Negative Stock News:

1. Oracle will not delist I-Flex Solutions until its price falls below Rs 2,100. CMP: 2,169.
2. Real estate builders with more than 5 crore turnover are under IT scanner.
3. Puravankara IPO revised price band due to poor subscription from 500-525 to 400-450.
4. Reliance Fresh will sell Diageo wine brands through Reliance Fresh. It is taking all the wrong steps in these days. Can any woman go to retail store that is selling wine?

Best Stock picks for Day Traders:

1. Buy IFCI: Heavy interest for IFCI stake.
CMP: 60.7
Target: 63.9

2. Sell SBI.
CMP: 1635.
Target: 1595.

3. Sell Reliance.

4. Sell GMR Infra.
CMP: 832.
Target: 760.

5. Sell DLF.

6. Sell Reliance Communications.
CMP: 547.
Target: 534.

7. Sell L&T and BHEL.

8. Sell I-Flex Solutions – Oracle will not delist I-Flex.

9. Buy Hindustan Lever and ITC in the late session.

Stock in the F&O ban period: Nagarjuna Fertilisers.

My views:

1. Sorry for not posting regularly in the last week. I will post regularly in the coming days.

2. An NRI reader from United States sent me his Portfolio for analysis. He has selected very good stocks like L&T, RPL, RNRL, Tata Investment Corporation, Praj Industries, and First Source etc with long term view. This indicates the growing knowledge about stocks among the retail investors and also among busy persons who have little spare time for research. Long term investors with good portfolios always become millionaires irrespective of short term fluctuations in the markets. Just imagine the benefits of L&T investors after the demerger of its businesses in 2009-10.

3. My sectors for long term investors – Power, Logistics, Shipping, Finance and Banking, Capital Goods and Infrastructure. One should allot 60-70% of their portfolio to these sunrise sectors.

4. I recommend 5-10% allotment to wild cards (future stars) like Wire and Wireless, Dish TV, Fortis Healthcare, Meghamani Organics, Celestial Labs, Ispat etc. They will give tremendous returns in the long term.

5. Invest 5-10% of your money in Government finance companies like TFCI, IFCI, IDBI, IDFC and PTC and PFC. Value unlocking and growing sentiment in these companies will help investors.

6. I recommend 5% allotment to cyclical stocks like Auto and Sugar for long term investors.

7. This is the worst results season in the last 2 years. IT and export stocks are the real culprits. Media, Construction and power sectors are saviours.

8. I don’t comment much on IFCI stake sale and its effects due to my large holding. This is my principle.

Stocks for long term investors:

MRPL and some bank stocks are my dark horses. Rolta and Northgate Technologies are my favourite IT stocks while Dr Reddys is a safe bet for 2011. PFC and IDFC are safe finance stocks along with Reliance Capital. Indo Tech transformer may follow Voltamp in the coming days. Closely watch Dhanalaxmi bank and accumulate on declines. Accumulate Maruti on declines. Reliance Communication is the safest blue chip for medium term investors.

Note: 25% of my holdings in IFCI at an average price of Rs 51. I also have holdings in L&T, RPL, ISPAT, Wire and Wireless, Dish TV, Fortis, Reliance Communications, PFC, RNRL and Praj Industries. 90% of my investments are for long term and 10% is for short term and day trading. I believe in the long term potential of India’s economic growth.

Please share your views on my stock picks and views.

Sound stocks rebound with volatility

Sound stocks like ABB, Reliance Energy will rebound and volatility will continue due to expiry of derivatives. Short term risk taking investors can take positions in HPCL and BPCL as oil ministry is mulling price hike.

CRUCIAL POINT: If Inflation remains stable, there will be no change in interest rates in RBI credit policy on July 31. This is a trigger for Banking, Finance, Auto and Real estate sector. Take positions in these sectors if Inflation is below 4.3%.

Global Markets: All the global markets are volatile with positive moment.

Stock of the day: ABB – It will announce good results.

Significant views:

1. Total un-liquidated turnover in derivatives is around Rs 1, 00,000 crore. My view is we may experience another May, 2006 crash. When I see atmosphere in Ongole town, many retail investors are buying stocks without any basic knowledge about the companies, valuations and other fundamentals. This is surely a worrying sign.

2. Laxmi Mittal supported Mukhesh Ambani on gas pricing.

Rumour of the day:

1. IFCI may announce stake sale/new business model on August 4. Don’t sell your shares for another 2-3 months. Long term investors should not leave this goldmine.

2. Government will hike diesel and petrol prices soon.

Positive News:

1. SAIL announced will jointly explore opportunities and R&D activities.
2. Infosys and Philips signed $ 250 million BPO deal.
3. KEC International announced 74% jump in net profit.
4. Yes Bank net profit jumped by 113%.
5. 62% rise Wockhardt consolidated net profit.
6. Ispat industries recorded net loss of Rs 9.53 crore in 2006-07 Vs loss of 812 crore in 2005-06.
7. Ashahi India net profit in Q1 increased by 316%.
8. Godavari fertilisers announced merger with Coromandel fertilisers.
9. IndusInd bank posted 62% increase in net profit.
10. IDFC signed MOU with IIFC to finance infrastructure projects. Its net profit rose by 38%.
11. HDFC announced 25% rise in net profit.
12. Castrol India net profit rose by 32%.

Negative News:

1. Sterlite Industries posted unimpressive results. Some more selling today.
2. Aptech Q2 net profit fell by 13%.
3. Suzlon net profit fell by 116%.

Stock advice:

1. No analyst talked positively about ITC in the recent days. Everyone is recommending ITC now and giving targets. It happens only in Stock markets. Never follow hot stocks and hot ideas. Invest in sound stocks with strong fundamentals and good growth prospects before everyone will talk about it.

2. Sugar companies are announcing disappointing results. Accumulate on dips and sell them on the day of Govt. Sops announcement.

3. Closely watch Essar Oil. Another turnaround story is in the making.

4. It is waste to subscribe to Zylog now. Allotment will be very low in the retail category.

Hot stocks for Day Traders:

1. IFCI: August 4 meeting on stake sale.
2. IDFC: Big Investment plans.
3. SAIL: Mittal association.
4. Ashahi Glass India: Good results.
5. ABB: Results today.
6. Reliance Communications and DLF - With risk

Please share your ideas.

Action will confine to select stocks

Stock markets successfully sustained yesterday’s melt down and bounce back with the help of FII buying in some stocks. Irrespective of market moments, these stocks will continue to gain today. Inflation will be around 4%. If inflation falls below 4%, banking stocks will rally in the afternoon session. IT stocks will fare badly on account of poor results and Infosys guidance.

Positive triggers:

1. FIIs started buying in select stock. So you have to follow stock specific trading/investing.
2. Tyre industry may surprise analysts with their results even though auto sector is down. Closely watch Ceat and Apollo tyres.

Stock of the day:

IFCI. It will open around 63 and may touch Rs 65-66.

Positive stock news:

1. Mastek ranked among the top 50 global outsourcing firms.
2. Indoco Remedies got approval from Brazilian FDA approval for its Goa plant.
3. Aptech and NIIT are in expansion mood in Vietnam.
4. Wipro consumer care bought Unza.
5. Nestle India is in acquisition mood.
6. Sony tie-up with Balaji Tele for content.
7. Bajaj auto set up 5 strategic units.

Negative stock news:

1. NPAs of ICICI Bank rose to 118% in retail segment. This is a real worry ahead of listing.
2. Bank of England hiked interest rates to 5.75%. ECB unchanged interest rates.

Stock advice:

1. Stay away from IT stocks for another 1 month. Bad results and rising rupee and salaries will cripple this sector in the coming days. Satyam may be the lone winner in Q1. Rolta India is a good long term bet.

2. Book profits partially in textile sectors. Government sops may not save this industry from collapse.

3. Khaitan electrical and Asian electronics announced wonderful results. Closely follow them.

4. Lupin may bounce back today on the acquisition talk.

Stock picks for day traders:

1. IFCI: Results and stake sale.
2. Bajaj Auto-Restructuring.
3. Balaji Tele- Sony ties up.
4. Mastek-World ranking.
5. ICICI Bank FPO may face pressure.
6. L&T may continue to march.

Note: I have 30% of my holdings in IFCI. I bought them at an average price of Rs 52.

Are you ready for consolidation?

Indian stock markets will consolidate in the coming days due to profit booking and negative triggers. Inflation will rise due to rising crude prices and IT giants will post unimpressive results. Too much rise in realty stocks is a real concern. There will be heavy selling in these stocks in the coming sessions. Don’t forget, it is consolidation but not crash.

Global cues: US markets once again ended on positive note. Tata motors ADR and VSNL ADR are significant gainers.

Stock of the day: Vishal Retail. I recommended this IPO for exceptional earnings. Investors who got allotment will get 100-150% returns on the listing day. Vishal will list around Rs 550-600 and may even touch Rs 650-700 within one week.

Significant news:

1. RBI is optimistic on economic growth.

Positive stock news:

1. IOC may acquire stake in Petkim of Turkey.
2. Reliance and Bharti short listed for Qatar mobile license.
3. Temasek will buy 5% stake in Bharti Airtel.
4. Eicher motor announced good sales overcoming bad sentiment.
5. Prism cement may continue to gain.
6. Ashok Leyland signed JV with Finland Company.
7. Bombay rayon bought Leela laces.
8. India Foils stake sale.

Negative stock news:

1. Moody downgraded Tata Power on account of aggressive expansion.
2. No hike in fuel prices-Political decision. Stay away from HPCL and BPCL.

Stock advice:

1. Exit from RNRL and RPL. Returns are minimal from these prices.
2. IDBI and IDFC may move upwards at anytime. Closely watch these stocks.
3. Today is crucial for IFCI. If it crosses 66, it will touch 75 within 2 days.
4. Book profits in GMR Infra and enter into this on dips. Too much rise within a short period is always a concern.
5. Dena Bank and Deepak Fertilisers are safe ones in this consolidation mood.
6. Ashok Leyland may continue to gain in the short-medium term.
7. NSE barred Futures and Options in IFCI and Nagarjuna Fertilisers.
8. ONGC may move upwards at any time. Keep an eye on this stock.

Stock picks for day traders:

1. Vishal Retail.
2. India Foils.

Note: I will partially book profits in my holdings. I may enter Dena bank, PFC and Fortis in the coming days at appropriate time. I hold my IFCI holdings irrespective of short term changes.

Indian stock Markets will make new highs

Indian share markets will open on positive note with selective buying in specific sectors like Real Estate, Sugar, Telecom and Financial sectors. Auto stocks will see heavy selling in their counters. Market indices will make new highs but may see some profit booking in the late session. Rising crude rate and mixed signals from Global markets are the only concerns.

Stock of the week: IFCI. Target is Rs 63-65.

IPO of the week: Everonn-Best stock for listing gains and Long term. Even though HDIL priced attractively, real estate sector may be in down trend at the time of listing.

Sector of the week: Real Estate due to DLF listing. DLF may not cross Rs 600 on listing. Book profits and exit.

Most significant news:

1. US federal reserve did not hike interest rates.

2. We will try to bring down the inflation to 3% - RBI.

3. DLF listing date is July 5.

4. BSE SENSEX may touch 50,000 by 2018- Morgan Stanley. Foreign investors are waiting for correction to enter into Indian stocks for long term.

Positive stock news:

1. IFCI board will announce stake sale in July 6 board meeting. There is enormous value left in this stock. Don’t book profits immediately.

2. Bank of Baroda sold 0.9% stake in NSE to Citi group at 2,282/share.

3. Tricom India announced wonderful results. Good stock for medium term.

4. Kernex Microsystems announced stock split and bonus.

5. Aurobindo Pharma announced 108% rise in net profit.

6. Tata steel will sell aluminium business of Corus.

7. GMR Infra announced 1:5 stock split.

8. CMC and Tata Technologies may merge with TCS but not Tata Elixi.

9. Emami posted good results and 63% increase in net profit.

10. Reliance Communications tied up with PBTL for international roaming.

11. Moser Baer will take price war to even new titles.

12. Wipro will buy Unza of Singapore.

13. Simplex Infrastructure bagged $11.1 million contract and rise in 29% profits.

14. Biocon will announce overseas listing by the end of next year. Long term investors should closely watch this stock to invest on dips.

15. Telecom companies may announce good subscriber numbers for the month of June.

16. Liberty shoes will dilute its stake in subsidiary to raise funds.

17. ICICI Bank approved $200 million loan to Videocon for acquisitions.

Negative stock news:

1. IPCL Q4 results are disappointing.

2. Bajaj Auto sales were down in June by 12%. Auto stocks will continue to feel the heat.

3. Infosys bidding is a speculation- Capgemini.

4. Tata steel lost bidding battle for Vietnam steel companies.

5. Dr Reddys is the lone Indian company in the SEC list of terrorist link companies.

6. Jewellery companies will be hit by US orders of withdrawal of concessions. Titan Industries will see selling pressure.

Stock advice:

1. Sugar stocks will continue to rise due to change in the fortunes of sugar prices. Keep trailing stop losses.

2. As I said in earlier posts, Investors at last recognised the true potential of GMR infra. You may exit the counter after another 15% rise and re-enter into wonderful stock on dips.

3. Financial stocks like IFCI, IDBI, IDFC, TFCI and PFC will continue to gain in the coming days. But you may get exceptional returns in IDBI and IDFC.

4. I suggested EID Parry for long term investors 10 days back. It already gave 10% returns within 10 days.

5. Capital goods index is at all time high. We may see some selling in this sector in July in spite of orders.

6. Medium term investors can enter into HUL –They will announce wonderful results and dividend. Bonus gossips are spreading.

7. Hinduja TMT will see some positive news within a short term. Risk taking investors can bet on this stock for short term.

8. You can accumulate Cairn India and RPL for long term.

9. Deepak fertilizers will give 10% returns in July due to monsoons and gas supply news.

10. Ranbaxy and Cipla may continue their positive momentum on Monday and Tuesday.

11. Global players want to buy some stake in Jet Lite. Buy Jet Airways on dips for short term gains.

Value stocks for long term investors: Best stocks in correction time.

1. Wire and Wireless.
2. Dish TV.
3. Cheviot.
4. RSWM and Welspun.
5. Raymonds- strictly long term.

Stock picks for medium-short term:

1. HDFC.
2. TCS-Results will not be as disappointing as analysts are thinking.
3. Kernex Microsystems-High risk and high returns.
4. Hindustan Lever.
5. Eastern Silks.

Stocks for day traders:

1. IFCI-Stake sale.
2. Aurobindo Pharma – Wonderful results.
3. RNRL and Tata Tele.
4. IDBI-Stake in IFCI.
5. Tricom India- Good results.
6. Renuka sugars and other sugar stocks – Positive momentum.
7. Unitech, Parsvanath and Sobha.
8. Ranbaxy and Cipla - with risk.
9. Sell IPCL.
10. Sell Bajaj Auto.
11. Sell Titan and Gitanjali Gems.
12. Sell HPCL and BPCL- Crude is above $70.

Why markets will crash in July?

Investors are in euphoric mood due to unexpected rise in the past 2 days. But future is looking bleak due to negative triggers. Except some sectors, most companies will announce disappointing results. It will be difficult for RBI to keep rupee value above 41 against dollar. If RBI will not hike interest rates, inflation will again move northwards. Crude price is another worry.

My advice: Some good stocks are at or near 1 year low. Take long positions in those stocks. Don’t take long positions in the sunrise stocks, most of them are near 52-week high. If markets undergo correction, they will suffer heavily. Sit on cash and buy on dips.

Please share your views on my analysis.

Flat markets with no major triggers

Indian stock markets will see marginal gains with gains in few specific stocks. If inflation is under control, markets will see buying in the mid session. Underperforming sectors like Cement and sugar stocks will shine due positive statements by finance minister.

Global cues: US markets are still in uncertain zone while Asian markets are in positive zone. Crude price is continuing its upward march.

Sector of the day: cement and Sugar (just my intuition).

Positive stock news:

1. Pfizer net profit rose by 7 times from Rs 35 crore to Rs 258 crore.
2. TATA Steel revived Rs 2,500 titanium project. Tata steel shares may bounce back today.
3. TCS is concentrating on Latin-America. It will acquire two IT firms in that region.
4. Infosys may acquire Capgemini.
5. IFCI is planning to sell 26% stake to institutional investors. I have invested in this stock. IFCI will definitely sell its stake at much higher price.
6. IDBI sold 2% stake in NSE.

Negative stock news:

1. SBI will hike home loan EMIs. NPAs will rise due to defaults.

My stock opinion:

1. As I said, Hindalco is returning back. Never invest in a stock just basing on the rumours. Shares of those stocks that rose without fundamentals will not able to sustain those valuations. I suspect the rise behind RPL even though it is a sound stock for long term.

2. Don’t get depressed by seeing the results of wire and wireless. It is a good long term story. Like telecom, investors will have to face losses in the initial stages due to big investments in the infrastructure. If you are a long term investor with 2-3 year horizon, it will be a multibagger. Accumulate this stock. Along with RPL, this stock will be future leaders in their field.

3. Cement companies may not sustain yesterday’s high rise for long term. Monsoon period is generally not good for cement companies.

4. Don’t be fooled by the Pfizer profits. Most of this income is from other sources but not from main businesses.

5. Due to good monsoon, fertiliser stocks will shine in the coming weeks.

6. ITL shares may see some selling pressure due to BSNL GSM equipment order troubles.

7. Religare bought ADK foods. Closely watch this stock as it is a acquisition target.

8. Tata Tea may bounce back on Cadbury buying rumours. Caution advised.

9. TVS Motors will continue to see selling pressure due to poor results.

10. Stay away from current IPOs. There will be good IPOs in the coming weeks.

11. Among entertainment stock, Shree Ahtavinayak is currently available at attractive value.

12. KRBL posted unimpressive results but stock is already bottomed out.

My stock investments in the last 3 days:

1. IFCI- So much value left in this stock.
2. Dhampur sugar mills – Low valuations. Strictly for long term.
3. Wire and Wireless – strictly for long term.
4. TFCI- short to medium term.
5. Hindustan Sanitary ware – with risk.
6. Mastek – Medium to long term.

Please share your opinion on my stock views.

Black Friday for Indian share market investors

D-Day finally arrived. Indian stock markets will be suffered huge losses and will see a panic selling from investors on black Friday. Nifty will fall below the final support point that exists at 4090 and BSE Sensex may lose 300-400 points. Long term investors can buy sound stocks at attractive price after the heavy fall. Though fall in markets is bad, it is good for long term investors.

Sentiment: Indian investors will see second biggest crash of 2007. All the global markets have suffered huge losses especially Dow Jones and Japan and Taiwan markets.

Sector of the day: IT and Sugar shares will be in lime light due to Government decision to allow sugar mills to retain central excise for 3 years from 2007 July.

Good signs:
1. Inflation is under control and it will be around 5%. Stocks may bounce back in the afternoon session due to inflation data or over correction.
2. Dollar may gain on weak currency.

Stock of the Day: Patni computers.

My stocks:

Enter into these stocks after the crash. Risk taking investors can take future positions in good stocks.

1. Sterlite India Industries.
2. Hindustan construction company (HCC)-Medium term.
3. Ispat industries – Long term.
4. Mahindra and Mahindra- short-medium term.
5. Idea Cellular.
6. Reliance Communications.
7. Patni Computers.
8. Cambridge Solutions.
9. Tata Chemicals.
10. Suzlon Energy.
11. Aurobindo Pharma and Glenmark Pharma.
12. AIA Engineering.
13. Alok Industries.

Significant stock news:

1. Textile sector will get relief package from government within a week or so. Take short term bet on textile stocks.
2. Tamilnadu petrochemicals- short-medium term with some risk.

Stock advice:

1. Mahindra and Mahindra will be going to rise in short term due to lack of options in auto sector.
2. I don’t believe in this Hindalco rise. It is a clear sign of herd mentality and I can’t understand why investors always fell in the trap of operators.
3. Risk taking investors can take short position in Tata tea.

Positive stock News:

1. Tantia construction received $1.8 billion order.
2. Patni computers will continue to rise on stake sale.
3. HCC got contract from Tata Steel.
4. Biocon signed MOU with an Australian University.
5. ONGC Board approved Rs 1200 crore investment to develop oss-shore fields in Mumbai high. 6. Mahindra and Mahindra is in acquisition mood in Italy.
7. Marico industries in restructuring mood and good bet for medium term.
8. Biotech industry touched $2 billion revenue in 2006-07 financial year.
9. Cambridge solutions is a good bet for short term.

Negative stock news:

1. Idea and Spice telecom called off merger deal. Invest in Spice IPO.
2. Tata motors decreased car production by 20% and delayed launch for India. Closely watch Tata motors, it may available at attractive value by mid July.
3. Negative momentum in Auto stocks will continue for another 10-15 days.
4. Hindalco will lose more around 7-10%.
5. Hindustan Zinc will suffer losses due to fall in Zinc prices.
6. Oil refining stocks will lose yesterday’s gains.

Day traders should stay away from Indian markets. Today is black Friday.

Please share your comments on my stock recommendations and analysis. Please share your views.

Unpredictable markets-news based trading

Indian stocks are moving in unpredictable ways with momentum is concentrated on few select stocks. One thing is sure correction due within a short period. Investors may take long positions in blue chips after the correction. Risk taking investors may buy stocks like EID Parry, Wire and Wireless, FDC Pharma, Berger paints and Rajashree sugars.

Stock advice: Don’t believe in the rumours of Hindalco and IDEA take overs.

Sector of the day: Sugar. IT Shares will be in reckoning if Dollar appreciates against rupee.

Market sentiment: Unpredictable markets. Forget index. Concentrate on select stocks.

Significant news:

1. Government will create 3 million tonnes of sugar buffer stocks to check fall in prices.
2. Aircel, Spice and Idea may merge to form a new entity. Invest in Idea for medium term. Target- Rs 145.

Positive Stock news:

1. Unitech received nod for establishment of IT SEZs at Greater Noida and Kolkata.
2. Cement companies like ACC and Gujarat Ambuja announced increase in sales.
3. Sterlite ADS will be listen in Mid June.
4. Parsvnath launched Rs 6 billion township.
5. ONGC bought stake in 3 Brazilian blocks.
6. JSW steel posted 36% jump in crude steel production.
7. Fortis appointed new medical team at Escorts heart institute.
8. Bajaj will launch LPG bike soon.

Negative stock news:

1. Bombay high court rejected Reliance Energy plea on MTHL.

Best Indian stocks for day traders:

1. Mount Everest: Open offer to buy a further 20% stake by Tata Tea at Rs 140.
2. Idea Cellular:
3. Sterlite:
4. GAIL: (with risk).
5. JSW Steel:
6. MTNL:
7. Shree Renuka sugars.
8. NIIT Tech: (Closely watch rupee value).

Stocks to watch out:

1. ONGC.
2. Parsvnath developers.
3. Fortis healthcare.

Please share your stock views.

Do you believe in research reports by Stock Analysts?

Outlook Business published a very good article on stock recommendations and research reports by equity analysts. The article raised an interesting point on how leading research stock advisors misguided investors in the Jet Airways IPO. The article listed 39 stock recommendations by leading research houses where innocent investors suffered heavy losses. It is a must read article for every investor.

How to identify best stock recommendations?

My Advice: Read and Listen their advice. Do your own research before entering into that stock. Retail investor is the last person to hear about their recommendations.

Business Today magazine conducted a poll to select best equity analysts in India. It is somewhat better to believe in their stock picks.

SSKI emerged as the leading stock research house in India followed by Kotak Securities.

Best Equity analysts in India:

1. Sanjeev Prasad – Kotak Securities
Sectors: Media, Oil & Gas, Telecom and Chemicals.

2. Shirish Rane – SSKI Securities
Sectors: Cement, Power, Construction and Real Estate.

3. Jesal Shah – JP Morgan
Sectors: Pharma.
Best analyst in the Pharma sector with 13 years experience.

4. Manish Saxena – Deutsche Securities
Sectors: Capital Goods, Cement and Utilities.

5. Prabhat Awasthi – BRICS Securities
Sectors: Media and Auto.

6. Priyanko Panja – Edelweiss Securities
Sectors: Capital Goods, Construction and Telecom.

7. Rahul Singh – City Investment Research
Sectors: Telecom and Oil & Gas

Please share your opinion on research reports of these stock analysts. Do you invest according to their recommendations?

Bears will dominate Indian Stock markets

Indian stock markets will lost around 150-200 points in the initial session on Thursday. Banking stocks will suffer heavy losses. If CRR hike is true, Markets may lose more than 300 points. It is better for investors to stay away from Indian share markets.

Market trend: Bearish/ Crash.

Rumour of the day:

1. RBI will hike CRR on Friday.

Significant News:

1. Global markets ended negatively. Indian ADRs suffered losses. Asian markets are in down ward trend.

2. Monsoon may be delayed by 3-4 days.

3. Alcohol consumption in India surpassed Juices and carbonated drinks. United spirits is a good bet for long term investors even at this price.

4. Crude price is gaining. Stay away from BPCL and HPCL.

Best stock picks for Day traders:

1. Alembic:
CMP: 65.6
Target: 70
Stop Loss: 58
It will receive Rs 45 crore as mile stone payment from Belgium Company.

2. Bharti Airtel:
CMP: 850.2
Target: 860
Stop Loss: 840
It crossed 40 million subscribers and reached top 10 cell operators in the world.

3. NIIT Tech:
CMP: 523
Target: 537
Stop Loss: 508
133% increase in net profit.
Concern: Rupee appreciation.

4. Hindustan lever:
CMP: 198.55
Target: 201 and 203.5
Stop Loss: 193

5. Sterlite Opticals:
It begged Rs 170 crore MTNL broadband contract.
CMP: 206
Target: 213
Stop Loss: 200

Stocks to watch out:

1. Idea cellular.
2. JSW Steel.
3. Divi's Labs.

Stay away from following Indian Stocks:

1. Dr Reddys, Torrent Pharma and Cadila received noticed from Government for increasing MRP of331 drugs. Stay away from these stocks.

2. Stay away from banking stocks due to CRR hike concerns.

3. Stay away from oil refining stocks due to rise in crude price.

Please share your views on movements of Indian stock markets.

Analysis on Indian Stock Markets

Indian stock markets may continue their volatile runs with investors are hoping for correction. My advice for long term investors is stay away from markets for another month. Day traders and short-term investors may gain if they concentrated on good stocks like Reliance Capital.

Though stocks like Reliance Industries, Welspun Gujarat, Jindal Saw, Sail and JSW Steel are good stocks with strong fundamentals, they are near lifetime high values. I don’t prefer such stocks as there is a scope for little rise and high fall.

Why Indian share Markets will move upward?

1. Political uncertainty was over. UPA Government will complete its full term.
2. Inflation is under control. There may be no change in interest rates.
3. There may not be noticeable slow down in Indian economy.
4. Telecom sector is continuing its dream run.
5. There will be huge investments in capital goods and power sector.

Why Indian stock markets may move downwards?

1. Investors may book profits on the upside.
2. Real estate bubble may burst at any time.
3. High P/E of many blue chip stocks. Companies may not continue their dream run.
4. Foreign investors may move away from Indian markets.
5. Metal prices may fall at any time.

Hot stock picks and their movements:

1. Teledata:

Though it is a good long term bet, this stock is experiencing too many fluctuations. It may again touch 80-90 and then will fall to 50-60 mark within a short span.

2. Reliance Petro:

This is getting attention from institutional investors. It may touch 100-110 within 5-7 trading sessions and then fall back to 80-85 level.

3. IFCI:

This is a fundamentally sound stock with medium term bet. It may touch 60-65 and will return back to 50.

Sugar Stocks:

Stay away from this sector at least 4-6 months. Recent rise in these stocks lacks fundamental reason. Sugar prices are falling in open markets. This trend may continue in the upcoming 4-6 months.

Volatile Stock Markets – Panic Investors

Indian Share Markets are in extreme volatile stage with panic investors are buying and selling without any specific reason. Stock Markets are moving downwards due to lack of positive triggers. Uttar Pradesh elections will provide another negative trigger for markets.

Advice for Day Traders: Book profits with modest gains. Exit from stocks with minimum losses.

Best Stock Picks for Day Traders:

1. ONGC: 918.6
Resistance – 934 and 949
Support - 906
ONGC consortium has struck 10 trillion cubic feet of natural gas and 1bn barrel of oil in Gulf.

2. Granules India: 126
Resistance – 129 and 132
Support - 123.9 and 121.7
Results and IFC stake.

3. Kotak Bank: 541.3
Resistance – 554 and 568
Support - 532
Profit increased 19%

4. Gail: 293.5
Resistance – 304 and 316
Support - 287
Q4 net profit of Dabur increased by 66%.

5. GHCL

6. Sun TV
CMP: 1603
Target: 1624

7. MTNL
CMP: 148.45
Target: 152

Murdoch plans to launch a tabloid in association with Sun group.

Significant News of the Day:
1. Ranbaxy completed the acquisition of South-African pharmaceutical company Be-Tabs.
2. Stay away from Sugar stocks.
3. Stay away from Oil refining stocks as crude rises after 1 week fall.
4. Fortis Health care IPO will be listed today.

Results Today:

Lupin, Granules India and Page Industries

Stock picks for Indian day traders

Indian Share markets may continue their bull run today due to decline in inflation rate (expected) and positive sentiment prevailing in the international markets. Only worry is marginal appreciation of rupee. Metal stocks may continue their bull run.

Significant News: Inflation may be down to 5.86%.

Global cues: Global markets are maintaining positive momentum. Asian markets rose due to decline in crude price and rise in metal prices.

Warning news of the Day:

1. The Finance Minister Mr P Chidambaram said policy measures would be intensified and supplies augmented to check the price line at the rate of 4.5 per cent.

2. Copper prices may fall about 30 percent by the end of the year as demand lags behind supply following a slowdown in the U.S. housing sector, according to the Commonwealth Bank of Australia – Bloomberg. But sentiment is bullish in the short term.

NSE Nifty: (4150.85)
Resistance – 4181 and 4211.
Support – 4100.6 and 4050.4

Best Stock Picks for Day Traders:

1. Gitanjali Gems (199.35)
Resistance – 206.5 and 213.6
Support – 195 and 190.8
Import duty on gems & jewellery has been completely abolished and duty on cut diamonds abolished.

2. Sesa Goa (1749.85)
Resistance – 1793 and 1836
Support – 1723 and 1696.
The export duty on iron ore finds has been slashed to 50%.

3. IFCI (46.7)
Resistance – 48, 49.3 and 50.3
Support – 45.7 and 44.7
Wonderful Results and stake selling news.

4. Colgate (351)
Resistance – 357.7, 364.4 and 369
Support – 346.4 and 341.7
Colgate Palmolive (India) will be reducing its capital by returning Rs 122.40 crore to shareholders, and reducing the face value of its shares from Rs 10 to Re 1.

5. Sterlite Industries (533.5)
Resistance – 538.5, 543.6 and 550.3
Support – 526.8 and 520
Sterlite Industries has announced its Q4FY07 results. The company posted jump of 40.7% in net profit at Rs 1,144 crore (Rs 11.44 billion) in fourth quarter as against Rs 813 crore (Rs 8.13 billion) in corresponding quarter of previous year.

6. ACC (852.3)
Resistance – 861.9 and 871.4
Support - 843.9
Reduction in duty and to pick up stake in Shiva cement.

7. Century Textiles (617.7)
Resistance – 626.6 and 635.6
Support – 611.8 and 606
Century Textiles has declared its Q4FY07 results. The company has registered net profit of Rs 94 crore (Rs 940 million) versus Rs 25 crore (Rs 250 million) in same period of last year.
Century Textiles board approves setting up 100 tonnes per day prime grade tissue paper plant for Rs 175 cr

8. Reliance Communications (471.75)
Resistance – 484 and 496
Support - 464 and 457
Reliance communications is in expansion mode.

9. Jet Airways (722)
Resistance – 737.6, 753.2 and 763.5
Support - 711 and 701

10. Eid parry India (122.7)
Resistance – 124 and 125.3
Support - 120.6 and 118.6

Stock news for Investors:

1. Jet Airways has chosen Brussels as its international hub.
2. Stay away from Reliance Industries and RNRL. Court halted RIL’s KG Basin sales.
3. Stay away from IT stocks – My intuition.
4. Stay away from Eicher Motors and United Phosphorus due to poor results.
5. Idea cellular to merge its 8 subsidiaries.

Results today:

1. Hindalco (145.9)
Resistance – 148 and 150.2
Support - 142=4.2 and 142.5

2. Gujrat state fertilizers (179.3)
Resistance – 181.5 and 184.4
Support - 177.8 and 176.4

3. Ashok Leyland and EID Parry

India’s fastest growing companies

Business today magazine published a special article on India’s fastest growing companies. It selected 63 large caps, 29 midcaps and 25 small caps as fastest growing companies. These are safe bets for long term investors. Cement, Construction and Metal companies dominated the listing. You can pick 2-3 future stars if you carefully analyze the data.

Caution: This selection represents the performance of the companies in the past year but not the future growth prospects.

Fastest Growing large cap companies:
1. Hindustan Zinc
2. Welspun Gujarat
3. Unitech
4. Pantaloon Retail
5. Ultratech cement
6. Gujarat Ambuja Cement
7. Nagarjuna Construction
8. Aurobindo Pharma
9. Hindalco
10. United Spirits

Fastest growing Midcap Companies:

1. Kalpataru Power transmission
2. Shree Cement
3. Hindustan Copper
4. Centurion Bank of Punjab
51. Man Industries

Fastest growing small companies:

1. Era Constructions
2. Asian Electronics
3. ICSA
4. ORD Informatics
5. Ansal Housing

If you want more information about these companies, read Business Today dated March 6, 2007.

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.