BSE Sensex will cross 19000

Indian share markets will make new highs in this week due to unexpected positive news from all quarters. Political turmoil will take a short break and give stock markets much needed positive trigger. IIP numbers are improved after a decline in the last 4 months. But stock markets are already in the grip of speculators. It is not time for serious investors to venture into stocks due to unreasonable valuations of almost all good stocks. Short term speculators can make decent money in these euphoric times.

Market Direction:

BSE Sensex will move to 19,200-19,500 in this week and may see profit booking at this range. Always expect the unexpected things in politics and stock markets. So, watch out for unexpected shocks.

Why Indian stocks will make new highs?

1. Political stability: Intelligence reports predicted shocks for UPA parties if mid term polls will be held in the next 6 months. So, congress backtracked from elections and nuclear agreement. But I still have some doubts on congress party strategy.

2. IIP Numbers: It is the real trigger for share markets. After reporting poor numbers since April, IIP numbers once again showed positive momentum in the economy.

Why investors should be cautious?

1. Profit booking above 19,000: 19,200-19,500 is the major resistance point. Be cautious in that range.

2. Political Games: Never believe in political parties. Next co-ordination meeting between UPA allies is crucial.

3. IT Results: Technology stocks will not make any fresh gains until next quarter.

4. Subdued “Credit crisis” will resurface at any point of time in united States.

Final verdict: My opinion is volatility will continue in October. BSE Sensex will see 19,000 and 17,000 in this month. Real investors should wait for 17,000 while speculators can play games according to the investor’s moods. Lay investors will definitely burn their fingers by investing in Reliance stocks at these high valuations. Some things will never change in share markets. 2007 will once again bring back the horrible memories of Harshad Mehta days and technology bubble.

Indian share Markets are in bearish phase

Bears will dominate Indian stock markets in the coming sessions due to weak global markets and profit booking. There will be a clear slow down in the growth of most sectors and fail to justify their very high valuations. This is a very opportunistic period for new investors who want to enter into good stocks. High growth stocks like R-Com, Reliance Energy, PFC, IFCI, IDBI, Praj Industries, ABB, L&T, JP Associates Etc. will be available at good valuations after this moderate correction. This is also a transition period in some sectors like IT and Telecom where TCS is looking strong over Infosys and R-Com over Bharti Airtel. Pharma is a safe bet in these volatile times.

Global cues: Global markets are looking weak with Asian Markets are down due to profit booking.

1. Dow Zones touch 14,000 during intraday and NASDAQ was at 6 year high. Profit booking was seen in the late session like Indian Markets.

New Listing – Sun Pharma advanced research.

Stock of the day: DLF. It will post wonderful results by tomorrow.

Significant news and views:

1. HSBC downgraded Indian equities due to increased leveraged positions and high valuations. It is bearish on Indian stocks.

2. Sensex target by the end of 2007 is 13,500-14,200 – HSBC Securities. It is a real concern.

3. Rupee target by the end of March, 2009 is 37.8 against Dollar – Credit Suisse.

4. IIP Numbers were once again down indicating slow down in economy with Consumer Durables and Auto is the worst performer while Capital goods is the best performer.

5. 10% growth is possible in next financial year – Finance Minister.

6. There will be some more CRR hikes – UBS.

Positive stock news:

1. Net profit of Zee Entertainment was increased by 50%.
2. KPIT Cummins posted 22% jump in net profits despite strong rupee and rising salaries.
3. Gateway Distriparks announced good results.
4. R-COM announced massive expansion plans. This stock should be in everyone’s portfolio along with Reliance Capital and Reliance Energy. Accumulate these gems on dips.
5. ITC Foods launched organic spices in select categories.
6. Tata Motors entered into Saudi Arabian market by launching 3 car models.
7. NDTV posted a net loss of Rs 2 crore Vs net loss of Rs 10 crore in previous quarter.
8. Nectar Life sciences is a very good stock but it was overbought.

Negative news:

1. Tata Tea net profit was decreased by 49%. Buy on dips. Tata Tea will give 20% returns within 1 year.

Stock advice:

1. Value unlocking in tower business by Reliance Communications will yield good results. This stock is a safe bet for any kind of investor.

2. Jubilant Organosys announced wonderful results. Stock is ready for new highs.

3. Biocon will rise ahead of good results.

4. Gateway Distriparks will announce good results.

5. TCS will overcome Infosys in forward PE due to its less dependence on US.

6. L&T is getting orders in a big way. Accumulate this stock on correction.

7. Accumulate Bharti Shipyard if you are a long term investor.

8. Hanung Toys is a safe stock for conservative investors.

9. Mutual funds are accumulating Meghamani Organics.

10. Noida Toll Bridge is another good investment. Good growth story at least for another 2 years. Valuations are the only worry.

11. Bayer Cropscience is a good bet for risk taking medium term investors.

12. Hindalco will be benefitted by Rio Tinto acquisition of Alcan.

Stocks to watch out for:

1. Reliance Industries – Strong Momentum.
2. Dr Reddys and Lupin – Pharma is a good bet.
3. Gujarat Ambuja, ACC and Shree Cement – Cement demand.
4. L&T – may bounce back on strong orders.
5. Reliance Energy.
6. DLF is looking strong ahead of results.
7. Tamilnadu News Print.
8. Alembic.
9. RNRL – may gain by 1-2%.
10. Jubilant Organosys.
11. Gateway Distriparks.
12. Plethico Pharma.

Share your views on Indian stocks and comment on my views.

Are you ready for profit booking?

Indian stock markets will see profit booking in most counters on account of weak global cues. Crude crossed $ 44 while rupee is continuing its appreciation. Markets are neglecting all these negative cues and investors are buying some stocks like Divis Labs, GMR Infra by forgetting valuations. Most of the new investors have not experienced the severity of market bubble in their equity life time. I am unable to understand their investment rationale when they are buying stocks at such a high valuations. RBI may hike interest rate at any time to keep inflation at 4%. Oil marketing firms may hike petrol and diesel prices if crude continues to appreciate. I changed my portfolio to long term stocks and low value stocks.

Global Cues: Negative. Except Dow Jones, most of the global markets are in negative zone.

Stocks of the day:

1. TCS – Sound stock for every portfolio. It surprised everyone with its stunning results and growth guidance. Satyam and TCS may gain around 15-20% within 1-2 months.
2. Reliance Industries – Gas find in Cauvery basin and upward momentum.

Sector of the day: IT Stocks.

Significant news:

1. Indian Entrepreneurs are most optimistic ones in the world.
2. Indian GDP growth will be at 9% while Inflation will be at 4% - Government advisory panel.
3. Everonn Systems fixed issue price at Rs 140.

Positive stock news:

1. TCS consolidated net profit rose by 36%.
2. IG Petro net profit rose by 88%.
3. Zee News made profit for the first time in this quarter. Profit of 6 crore against loss of 54 lakhs.
4. Petronet profit rose by 90%.
5. KS Oils got investments for its expansion plans.
6. TVS Motors started Indonesian operations by launching Neo.
7. Venus Remedies signed 10 year deal with a Chinese form to sell their Antibiotic.
8. Ashok Leyland formed JV with Siemens Automotive.
9. Tata Coffee will launch 100 retail outlets within 5 years.
10. L&T Consortium bagged orders worth Rs 1070 crore.
11. Reliance Communication is continuing its momentum by acquiring foreign firms.
12. JP Associated announced good results. Investors booked profits.
13. Idea launched “My Gang” card at attractive price.

Note: I will write about future stocks and low value stocks within 3-4 days. My stocks like Wire and Wireless, Fortis and Mastek at last got their due. Some will become multi-baggers if you are a long term investor.

Please share your views.

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.
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Please share your views and advice on Indian stocks.

Stock Markets may see some correction on tuesday

Indian stock markets will correct on Tuesday due to profit booking, rupee appreciation and rise in crude oil price in the initial session. Markets may recover to some extent in the afternoon session.

US markets gave no significant clues while European markets rose due to rise in metal and crude prices. Indian markets will not follow global and Asian markets on Tuesday (My opinion).

Sentiment: Bullish/Volatile.

Positive trigger:

Rise in metal prices. Metal stocks will shine on Tuesday.

Warning News:

1. Crude oil price surged past $70 due to unrest in Nigeria. Reliance and Government oil refining stocks will suffer losses.

2. Front line stocks like Reliance Industries rose too much without any reason. This may play spoilsport to the market sentiment.

Stock recommendation for long term investors:

1. Idea Cellular:
Stock will cross 250 within one year due to exponential growth in Telecom space. This is the safe bet for long term investors.

Hot Stock picks for Day Traders:

1. Raj TV:
CMP: 262
Target: 271 and 277.
Stop Loss: 252
DMK-Raj TV alliance will trigger short-term growth for this network. It may cross 300 in this week. It bagged licences to launch 3 new channels.

2. TV 18:
CMP: 850
Target: 881
Stop Loss: 807
It forms an alliance with Virgin comics. It plans to launch an entertainment channel.
Caution: Investors may book profits in the initial session.

3. Orbit Corporation:
CMP: 229.5
Target: 233 and 237
Stop Loss: 222
Net profit rose 8,533% while sales rose 4,190%.

4. Satyam:
CMP: 447.5
Target: 457
Stop Loss: 443
Satyam signed contract with Hawker Beechcraft Corporation.
Caution: Rupee Vs Dollar.

5. Ranbaxy:
CMP: 400.7
Target: 403.5 and 406.5
Stop Loss: 398.3
Ranbaxy received approval to market Pravastatin in Canada.

6. Sterlite, Hindalco and Hindustan Zinc- Closely watch metal prices.

7. Dr Reddy’s Labs: Unexpected loss on Monday.

8. Reliance Energy and Reliance Communication will continue their bull run.

9. Closely watch Wockhardt, Tata Motors and NDTV.

Negative Stock Picks for Investors:

1. Stay away from SUN TV. Its quarrel with DMK government hits nadir.
2. Stay away from Everest Kanto.
3. Stay away from oil refining stocks like HPCL, BPCL and IOC.
4. Stay away from Apollo Tyres.

Please share your stock recommendations.

NSE Nifty is at all time high

The NSE nifty reached an all time high of 4269 during intra-day session. Nifty finally ended at 4261 on Monday due to massive gains in Banking, Media, Metal and Reliance stocks. Surprisingly sugar stocks also rose without any positive triggers. IT stocks suffered losses due to rupee appreciation.

Day of Reliance:

Companies of Ambani brothers are the major gainers on Monday trading.

1. Reliance Energy rose 8.5% while Reliance Industries surged 3.7%.
2. Stocks of Anil Ambani are continuing their positive momentum.
3. Oil stocks are the surprise gainers.
4. Gains in SBI and HDFC boosted the market sentiment.

Can Stock Markets sustain this rally?

Absolutely not. Indian Stock markets can’t able to continue this rally in the coming sessions as valuations are stretched a bit too much.

Why markets may not continue this rally?

1. There will be no significant positive triggers after results.
2. Rise in interest rates may affect the margins of companies in the coming quarters.
3. Investors may book profits to enter at low valuations.
4. Sectors like sugar are rising without any reason. These are the dangerous signs.
5. Rupee is appreciating against dollar. This will severely affect IT and other export stocks.
6. Companies are investing big money. It will take time to yield results for these investments.


Markets will definitely return to 13,000 mark. Investors may enter into stock markets at these levels. But some good stocks like Dr Reddy’s labs are trading at attractive valuations. IT stocks may regain their value if dollar appreciates again.

My advice is stay away from Indian stock markets. Short term investors may invest in IT stocks as dollar will surely appreciate again. Investors who will enter into share markets at this level due to media hype will suffer heavy losses especially if they invest in high valued stocks like Reliance, SBI and RNRL etc.

Please share your views on Indian Stock markets.

Stock Markets are in the grip of operators

Indian Share markets are experiencing huge swings due to buying and selling by smart operators. Ordinary investors may have lost big money in these wild swings. Retail investors and day traders should tread cautiously in volatile times. Crude oil price rose again on supply concerns.

Market Movement: Bullish.

Warning News: Central banks may tighten liquidity. It is not a good sign for medium term investors.

Best Stock Picks for Day Traders:

1. JK Cement
274% jump in Q4 net profit. Net turnover was increased by 49%.

2. Shree Cement
CMP: 1037.7
Target: 1067
Stop Loss: 1007
It will announce good results today.

3. NTPC
CMP: 154.9
Target: 157
Stop Loss: 150

4. Novartis India

5. Lanco Infratech
CMP: 157.3
Target: 159.3 and 162
Stop Loss: 154

6. Reliance Communications
CMP: 478
Target: 486
Stop Loss: 458
It will likely get additional spectrum.

Positive News:

1. Inflation is under control.
2. Asian Markets are trading positively.
3. ONGC subsidiary Mangalore Refinery posted 41% jump in the last financial year.

Negative News:

1. Reliance Energy’s ambitious plans may be halted due to change of guard in Uttar Pradesh.
2. Stay away from Arvind mills.
3. ICICI Bank will be investigated by MRTPC for making false promises to its credit card customers.
4. Stay away from Hero Honda due to poor results.
5. Stay away from Dr Reddys due to American court ruling.

ICICI Direct stock of the Week:

Apollo Tyres

Economic Times Stocks of the Week:

1. Reliance Petro- Safe Bet.
2. SAIL- Somewhat risky.
3. Global Tele – Safe Bet.
4. Jain Irrigation – Long term bet.

Reliance Money stocks of the week:

1. Tech Mahindra
2. Polaris

Stocks for Medium term:

1. Philips Carbon Black
2. Pioneer Embroideries

10 Best Stock picks for Long term investors (1 year- 2 years):

1. Jyothi Structures
2. Alok Industries
3. Reliance Petro
4. Reliance Capital – Best stock for long term investors.
5. Larsen and Toubro
6. Idea Cellular
7. Reliance Communications
8. RNRL
9. Cipla – It is fundamentally strong stock.
10. Tata Tele

Enter into these 10 stocks at lower price:

1. Tata Motors – Growth story lies ahead.
2. Reliance Industries
3. ABB
4. BHEL
5. Kalpataru Power Transmission
6. Tata Steel
7. Bharti
8. HT Media
9. Shipping corporation of India
10. Tata Power

Please share your opinion on my stock picks.

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 Indian Share Markets

Indian Share markets were highly volatile yesterday due to ending of derivative contracts. Long term investors should stay away from the Stock Markets. Markets seem to be in uncertain mood. It is better for investors to wait and watch. If inflation will rose, markets will suffer heavy losses in the late trading session. Watch out for inflation mark.

News of the day:

1. India is showing ‘classic signs of an overheating economy,’ with high growth and accelerating inflation – Moody Investor services.
2. India entered into $ 1 trillion GDP economy list.

Best Stock picks for the Day Traders:

1. Hotel Leela
2. Reliance Industries
3. Reliance Communications
4. Sun TV
5. Sesagova
6. Hindustan Zinc
7. SKF India

My observations:

1. Tata Tea may see some profit booking.
2. Reliance Communications may rise today.
3. Suzlon Energy may lose today due to shut down of 44 wind turbines.
4. Cipla, Deccan Aviation and Marico may lose today due to unimpressive results.
5. TCS and Wipro may lose today due to unexpected rise yesterday.
6. Reliance may rise today due to good results and unexpected loss yesterday.
7. Pharma stocks are in the hot seat due to US approvals and acquisitions.
8. Long term investors should stay away from stocks which are near all time high like SAIL, Sun Pharma, ABB, Air Tel, Ipca labs etc.
9. Medium term outlook for Sugar stocks is not good. Enter into these stocks at low levels but not at this time. Wait for another month.
10. Indian Share Markets are not following their global markets in the recent sessions.
11. Hero Honda is now near 52 week low.
12. Shree Renuka sugars is a good bet for long term investors.
13. Utilize Sesagova open offer.

Positive News of the Day:

1. Reliance Communications and Alcatel –lucent deal.
2. Computer Sciences Corporation (CSC) will acquire Covansys for $1.3 billion.
3. Teledata suffered reverses for the first time in the recent memory.
4. Sun TV will launch a children’s channel.

Negative news of the day:

1. Price of Mind Tree consulting was manipulated on the IPO listing.
2. Low cost airlines Air Deccan posted a loss of Rs 213 crore for the third quarter.
3. 44 wind turbines operated by Suzlon Energy were shutdown yesterday due to protests from local residents.

Please share your ideas.

Bulls are dominating Indian Stock Markets

Indian Stock Markets may continue their bull run today. Positive cues from global markets and Reliance results will help in continuing the bull run of the Indian shares.
Advice: Never enter in the first 2 minutes as most of the stocks will start on high note on bull days.

Global Markets: All the global markets are on positive mood and Dow Jones crossed 13,000 yesterday. Asian stocks are continuing their positive momentum. These are good signs for Indian Share markets.

Crude oil prices are reaching new highs. Rupee is attaining new highs.

News of The day: Reliance Industries will announce results today. It will have a major impact on the movement of markets.

Stocks of the Day:

1. Eicher Motors
2. Grasim Industries
3. Reliance Industries
4. Larsen and Toubro
5. Cipla
6. Marico
7. Dr Reddys Labs

Positive Stock news:

1. L&T bags order worth Rs 200 crore from UAE firm.
2. TV 18 to launch 2 new channels.
3. Dr Reddys labs received approval for Zolpidem.
4. Dabur India has highest growth in oral care.
5. Reliance Energy may gain today due to marginal loss yesterday.

Negative Stock news:

1. Nalco announced disappointing results.

Indian Stock Markets are shining

Indian Stock Markets are attaining new peaks as bulls are dominating the markets. Reserve Bank of India fuelled the market mood by not changing the interest rates in its annual credit policy. Bulls will dominate the markets in this whole week. Day Traders may gain profit by investing in rising stocks. Long term investors should stay away from Indian stock markets in these volatile times especially from blue chip stocks and banking stocks.

Breaking News: Dollar falls below 41 mark against rupee. Stay away from IT Stocks.

Observation of the day: Reserve Bank of India changed the inflation target from 5.5% to 5%. So, don’t take long term positions in banking and finance shares.

Global Markets: No significant clues are available from global stock markets.

Stocks of the day:
Banking and Auto shares may rise due to positive sentiment prevailing in these sectors (RBI policy).

IT stocks may lose heavily.

Positive news for Day traders:

1. Wockhardt Ltd. has received approval from the US Food and Drug Administration to sell lisinopril, which is used to treat high blood pressure and heart disease.

2. HDFC posted impressive Q4 results. It is the stock of the day.

3. Elder Pharma may gain slightly.

4. Bajaj Hindustan may rise again due to export subsidies and 3 new plants.

5. Indian oil companies may gain from price hike.

6. Reliance Energy will gain due to power tariff rise.

7. Jubliant Organosys to buy US based Hollister-Stier Labs.

Negative news for Day traders:

1. Rupee is continuously appreciating against Dollar. So, stay away from IT Stocks and Exports based stocks.
2. Stay away from MTNL. Its ADR lost around 7%.

Results today:

1. Grasim, Dena Bank, Idea Cellular, Glenmark, Patni, Godrej Conjumers, Reliance petro, RNRL, Mahindra Gesco and SRF.

Happy Trading! Never change stop loss and target without specific reason.

Indian Business Marvels

Indian Business Wonders

A young engineer starts of a world class company which makes even peons rich

- Narayana Murthy of Infosys.

A small timer from meerut moves to Mumbai and builds an airline empire

- Naresh Goyal of Jet Airways

A cycle parts trader from Ludhiana takes phones out of the house and puts them in the hands of plumbers and fruit vendors - Sunil Mittal of Bharti Airtel

The son of a school teacher created petroleum giant - Dhirubhai Ambani of Reliance.

Source : Times of India