Market Comments - Knee Jerk Reaction

Markets will react negatively to news of Benazir Bhutto's killing in Pakistan yesterday but it will be a knee jerk reaction. When we had blasts in India and that too in Mumbai only, our markets reacted negatively but the next day we had recovered very sharply.

History shows that every time there is some event of global terrors, markets tend to go down but recover very sharply. History will repeat again, so there is nothing to worry.This is a very good opportunity for those who are waiting to enter the markets or those who want to make some quick money in short term.

GMR Infra is planning to list it's energy subsidiary GMR Energy and going by the current favorite sector in market which is power sector, the valuation will be much higher. GMR Infra will definitely give you 40% to 50% returns in 2 months.

Reliance will also give very good returns in next 2 months and please do not miss the opportunit y to buy this. I am very bullish on this and very soon you will see stock split coming in this.

IFCI is also another stock which will be in accumulation mode and may be range bound for sometime between 70 to 85 but just check the price of IFCI after 6 months.

DLF may rise on the news of Demerger plans.Real estate major DLF plans to raise $5 billion over the next three years by listing five of its business units, including DLF Homes, DLF Retail, DLF Hotels, DLF Utilities and DLF Infrastructure. There are no plans to further dilute equity in group flagship DLF. The eventual strategy is to make DLF a holding company with considerable equity stakes in the listed entities in addition to being an incubator for new businesses

"A successful Investor in stock markets is one who can see tomorrow and beyond it and not worry about today....."

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This is my last post of Market Comments in this blog and From Monday, December 31st, my market comments will be available at the blog

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This blog will be available for registered members only.

Please see the post on registration details for registering.

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I thank all the blog readers for the great association we had in the last 4 months.

"SALAAM NAMASTHE"

Market Comments - Bulls in Full Flow

Bulls were in flow for second day in a row and the short sellers were trapped so badly that there was no profit booking seen towards closure as the number of shorts were very high.

Reliance was in full flow and it is now at 2900 and just another 100 away from the magical 3000. Once this is crossed we will see lot of action and the news of stock split coming soon.

Jai Prakash Associates was one stock which was not talked about me but it moved from 1275 before split to cross my target of 2000 which was one year target but it was achieved in 2 months.

DLF was another star performer and it crossed 1000 yesterday and now the revised target is 1500 in one year but it may be achieved soon.

GMR Infra touched 248 and we should see it move towards my target of 325 by March 12th.I have given access to all those who completed their registration formalities till Dec 26th.

Tomorrow will be my last post in this blog.

Market Comments - Strong Global Cues Lift Markets

Markets rose smartly on Monday due to strong global cues as expected but the profit booking did not come down as the bears had to cover there positions as there were huge shorts built up.

We will see another strong opening on Wednesday morning and we will see some profit booking coming in later half of the day unless we see huge shorts being covered again.IFCI was one of the star performers of the day.

As I had mentioned that 75 was good level to enter this stock, IFCI was down to 73 but later rose to 81 because of buying interest in this stock and also short covering. There were many smart investors who bought IFCI at 75 levels as they know that 50% returns can be expected in another 6 months. What more we want?

GMR Infra is stuck at 240 levels similar to what happened at 140 levels but it should move to 325 - 350 levels by March 12th when the Hyderabad Airport will open as this will be the major trigger for this. Watch out for the action in GMR Infra in next 2 months.

Watch for our RIL now . There will be lot of action in this stock and once RIL decisively crosses 3000 you can see the real star action in this.There are many speculative stocks to pick and I will give the list of this in coming few days.

Monday Morning Market Musing - Fresh Innings

Good morning to all of you and we are beginning another week of activity but this week will be a short week as tuesday is a market holiday for Christmas. Thursday will be the settlement for this month F & O and so we have only 3 days for the settlement.

There will be lot of volatility due to rollover positions being high and at the same time there are lot of shorts built up. We will see gap up opening as shorts are covered on opening but again we see rollover positions bringing down the market. Those who want to gain in our market need to have two things which are a must. One is discipline and other is patience. If you lack either of these, you may not gain but instead loose your money.

There are many other factors like greed and fear but all these are part of the above two. Most of the investors attitude is to make some quick money but the real gainers will be those who have invested in a disciplined manner and also have enough patience to reap rewards.

Just to give an example : When i recommended GMR Infra at 160 in this blog, it really tested the patience and even went to 140. When sensex zoomed from 17K to close to 21k also GMR was not moving up but I just asked you to be patient. After few months, sensex came back but GMR started its up move and from 160 it went to 260 in less than a month. This is how one can make money with patience. Some stocks even test you for 6 months to 1 year but if you are confident in the stock then stay invested.

Teledata should most probably list this week as per the official communication on its website which says that it has got approval from NSE and BSE for listing. Wait for fresh innings to begin and we should see a good opening in new year.

Please note that my last comments on this blog will be on December 28th and there after I will be posting my comments on the blog http://indianstockmarketcomments.blogspot.com/

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Registration Details Update

As you all aware that starting January 1st, 2008, I will be writing my comments at the new blog
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This blog will be available for registered users only.

I thank all of you for responding to my registration request. I have completed access to all those who have completed the registration formalities as on 21-Dec-2007.

Please check your mails for access link.

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IFCI Update

As expected IFCI is stuck around 75 to 80 levels due to panic selling by investors who entered around 100 levels to make quick bucks. Added to this the ban in F & O created further problems as there was huge winding of in F & O positions and so this has led to the fall to 75.

Now watch the story of IFCI from here. There are some talks going on with International Finance Corp which is monetary arm of World bank for some stake sale which could be around 10 to 15%. This will be at a much higher price.

There is no need for IFCI investors to worry at this point if you plan to hold it for atleast another 6 months to 1 year.

Market Comments - Rollover Problems

Markets corrected from the peak as there were huge positions to be rolled over in F & O for this month. With Friday and Tuesday being market holidays we have only 4 days to rollover and so this was good opportunity for bulls to rollover when market rallied smartly.

This volatility will be seen till Dec27th but after this there will be a decent rally and there should not be any worry as it will be like beginning a fresh innings. It is a like batsman getting out after making a triple century but it will be different when he begins a fresh innings.

IFCI deal was cancelled which means that the stock will crash on opening today and it can be as high as 20%. This will be disappointing news for short term holders of IFCI but these type of things should be taken in stride. If you see my recos, I have put this stock IFCI in speculation stock list because of the nature in which the stock price was moving up.

Now IFCI can be available at around 80 Rs and it is only short term traders who will suffer the loss. Why? The reason is simple. IFCI wanted a price of 150 Rs as its bid price as there is lot of hidden value in IFCI. If institutions buy at 107 Rs and some one is ready to buy at 111 Rs then is it not the price anything below 100 is a golden opportunity?

IFCI will go down temporarily but just watch the price of IFCI after 3 to 6 Months. You will see the price of 120 again. This means if IFCI is available aroudn 80 today, it will give you 50% returns in 3 to 6 months. If you hold it for long term of 2 to 3 years, you will get excellent returns and target of 500 is possible. Those who are holding free shares in IFCI can continue to hold so and even may be add some at lower levels to make some more free shares after 3 to 6 months.

There will be lot of volatility as we have only 4 days left in this month for the F & O expiry and after Dec 27th, it will be a different story. The advance tax numbers show that profits that will be reported by companies will be good and Reliance numbers look excellent.

Powergrid is planning to move into entertainment sector by tying up with Zee entertainment and it will be additional profits for this. We may see demerger also in future. Please try to get some of powergrid shares at lower levels and hold for 2 to 3 years. This is a must. For short term holders you may get 50% returns ie 200 levels in 6 months.

There is no news from Teledata on listing date but I expect it will be available soon.

My last column in this blog will be on Dec 28th as I will be taking of on Dec 31st. Please register yourself asap to avoid delay in getting your access created. Please see the messages below for registration details.

Query on RPL

There have been lot of queries on RPL regarding the target for RPL. I had recommended RPL on this blog when it was around 120 levels with target of 180 in one year. It has surpassed my target in few months and hit high of 300 and came to 220 levels before I recommended to buy it again around 220 levels.

Many of them accumulated RPL around 190 to 220 levels and I believe many of the blog readers are in profits in case of RPL as it was first recommened at 120 and then around 200 avg price. Those who are stuck at 270 and above levels need to wait patiently and it difficult to predict the target in short term as it depends on market conditions and news flow.

There is one talk that RPL may start production in March 2008 and if this news comes out RPL can shoot up to cross 300 levels again in next 2 months. The major reason RPL is being suppressed is talk of merger with RIL and market corrections.

I am sure RPL will still reach around 500 levels in one year and even if merger with RIL happens one will get atleast 400 Rs worth in RPL.

I hope this clarifies all blog readers doubt.

Market Comments - Golden Opportunity

Markets have corrected again and we are at 3 week low. This should have been a disappointing day for those who are trading in F & O or for those who are looking for short term gains. However for those who are long term investors, it is another golden opportunity to buy stocks at lower levels.

GMR Infra QIP placement was 240 Rs which means that price is going to breached any time and so anything below 240 is like getting the stock at discount. It is for you to use this opportunity if you have not bought this before or would like to add more.

There have been lot of news in media about IFCI bidder being Morgan Stanley and the price as 111 but nothing is confirmed. However the stock conversion price of 107 Rs to institutions act as a good cushion similar to GMR Infra. Those who want to stay put in IFCI for long term can still buy at current levels. Please hold this stock for 2 years and see what price it gets you.

Bajaj Auto Demerger is waiting for court approval and this may be cleared soon. Demerger should be complete in another 2 to 3 months and those who are invested in this can continue to do so. Those who want to make quick money in next 2 to 3 months can enter Bajaj auto now and exit before the demerger record date.

SUN TV has touched 400 and is close to my target of 450 which was given as one year target but it is likely to be achieved in next 2 months.

Reliance Industries is giving you the last opportunity to buy and believe me if something unusual does not happen you may not see Reliance below 3K very soon.

There is nothing to worry if you remember the famous song....
"WO SIKANDAR HI DOSTON KEHLATA HAI,
HAARI BAZI KO JITNA JISE AATA HAI"

You should be more than a Sikandar so that you can say...
"HAARI BAZI KO JITNA HAME AATA HAI"

Market Comments - Tomorrow Never Dies

Markets have corrected sharply and though I was expecting bounce back by evening it did not happen. Bears have taken firm grip and we may see some more downfall in our markets.

As I have been writing in my blog since past 4 months, our markets had run up considerably and hence we need to move in the specified range for some more time before we decisively move to next levels. 21K is going to be tough to crack but it will come soon.

This is an excellent opportunity to buy stocks for those who missed and for those who bought earlier it is opportunity to make some more money.

Reliance industries gives ample opportunity to make good money. If you have missed this earlier or want to add some, it is a good opportunity to do now. Believe me Reliance will hit a target of 10000 in next 3 years considering the aggresive growth plans it has. Considering stock split to 2 Rs, it will be 2000 Rs. ex stock split. I believe split will come around 3200 levels and after split it will start around 800 Rs and then the journey will continue to 2000 Rs.

Reliance Petro will still have its own value unless we hear concrete plans about the merger with RIL. There is nothing to worry for RPL share holders but please continue to hold RIL shares at the same time as it will give good benefit when swap ratio will be in benefit for RIL share holders.

IFCI bid price was around 111 which was less than the 120 to 150 price expected and so the stock will react in short term but in long term IFCI share holders will get good benefit. Reason is simple, If some one is buying 26% stake at 111, the price should be better in one year than this. There is no reason one will buy huge stake at 111 without any benefit.

GMR Infra also corrected to 224 and those who bought around 240 levels can add some in this correction mode.

Powergrid gives an excellent opportunity to buy as it is around 137 and so we can see it cross 150 again after market stabilises.

Please see my stock picks for stocks that I have recommended and buy wherever there is value and if you have not entered early or want to add more.

"Tomorrow Never Dies"

Monday Morning Market Musing - Weak Global Cues

Good Morning to all of you !. It is another Monday morning and another half hour to go before the action in our markets start this week. We have weak global cues to tackle with but we have strong bulls in our market to tackle the cues. We will have weak opening but markets should consolidate and bounce back again.

There have been lot of questions on Reliance and RPL merger and though RPL share holders will be at slight disadvantage when the actual merger takes place, my advice is to stay invested in RPL as the merger may or may not happen. However one should also have Reliance Shares in their portfolio and it should be a balance. I expect that demerger will take place in only in 2009 by the time the valuations will change considerably.

IFCI conversion price for changing the debt to equity of financial institutions may be around 107 Rs and the bids are expected to be around 130 to 150. However all this can change but if you are a long term investor please hold on to get good returns in long term.

Please DO NOT miss the opportunity to buy Reliance Industries if market corrects as I expect it to cross 3000 soon and then the stock split will follow.

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Teledata Update

Teledata shares have been credited to the Demat accounts of all share holders as on Record date of November 23rd 2007.

If you had 100 shares of Teledata previously, you should now see the following in Demat account.

NA 100
NA 50
NA 50

These are the shares for TDIL(Teledata Informatics Limited)
TDMS ( Teledata Marine Solutions)
TDTS ( Teledata Technology Solutions).

If you are holding ICICI direct account, the previous code for teledata was TELDAT but now the new codes should be TELINF, TELMAR and TELTEC for the new companies.

TDIL should be listed next week and the remaining two will list in subsequent weeks.

All the best for TELEDATA share holders.

Market Comments - Another Opportunity

Markets may open flat and go negative. This is another opportunity for those who missed my recos earlier.

Reliance Industries is going to soon go past 3000 and then stock split may be announced. I stronlgy recommend a buy on this at this level if you missed earlier. RPL also will explode soon.

I am signig off for now and will update you in the evening with more news.

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I have restricted the blog indian stock markets query for registered members only. This way I will be able to answer queries regarding stocks and other advices.Starting January 1st 2008, My Market Comments will be available for registered members only. Please get yourself registered before that.

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Market Comments - Consolidation Time

Yesterday markets moved up as the opening was decided by the global cues but Smart bulls had different idea. Today it is consolidation time and Bulls will be back again.Nothing to worry about markets fall today.

Teledata shares should be credited to your demat account by today as per information from Registrar to Teledata. I hope the listing will take place next week.

IDEA cellular will perform in coming days and you should see target of 200 in this counter soon.

GMR Infra is consolidating and also in F & O ban and hence the movement is restricted.

Market Comments - FED Disappoints Wall Street

US Markets had rallied smartly on FED rate cut but when the rate cut was 25 bps, there was dissapointment and Wall Street tumbled.

Our Markets will also open weak as there was a good rally yesterday but what happens later will be known to smart investors only.

I will revise the targets for my stock picks and put the revised ones. DO NOT worry on that.

Comments on Current Stock Picks

Here is the updated consolidated list of stock picks and my comments on them

New Stock additions in December 2007 :

1. Idea Cellular : Buy aroudn 140 Levels for target of 200 in 3 months. Low valuation and good earnings expected. To be included in NIFTY from Dec 12th. Joint Tower Business with Bharti and other groups to give lot of savings.

My Old stock picks :

1.BAJAJ AUTO LTD
Demerger will create value for stock holders. My target is 4000 in 1 to 1.5 years. Already stock has run up from my recommended level in September but still target is intact.

2. BHEL :Good order book position. Can expect an appreciation of 50% in one year.Stock has appreciated well and target of 3000 is on cards.

Revised target is now 4000 in one year (by Dec 2008.)

3.DLF Limited :Target of 1100 in one year. Good stock to buy in Real estate. Based on Annual EPS of 40, it is quoting at 15 PE currently and is undervalued.We are close to this target and revised target for DLF should be 1400.

4.ICICI BANK LTD.One more good banking stock to pick in private sector. One can gain around 30% in one year time.I think it surpassed my target. It should gain another 30% from here in one year.

5. INFOSYS TECHNOLOGIES LTDTechnology stocks which were once darling of the markets have taken back seat now and are not finding any takers but I still believe Infosys will deliver decent returns even in adverse conditions. I expect a target of 2500 by March End.I still maintain my target .

Update :
There is a possibility that IT stocks may not do well in future due to rupee appreciation and we may see 35 levels in rupee. So only long term holders can continue to hold infy with 4 to 5 years vision. As suggested invest some of your profits only.


6. Reliance Communications LimitedGood stock to hold in portfolio. Expect a return of 40% in one year from current levels.Rel Comm has multiple triggers and next target is 1000 based on its subsidiaries listing in foreign exchanges.

We should see target of 1500 in one year from now.

7. RELIANCE INDUSTRIES LTDTarget of 2500 in one year. It will move with Sensex and retail story can fuel this upto 4000 in 2 years.One year target was achieved in one month now I expect 3200 target in next one year.

Update : Revised Target is 5000 by Dec 2008. Reliance Retail IPO will be out very soon. I expect target of 10000 in Reliance by 2010.

8. Reliance Petroleum LimitedRevised target for RPL is 250 in one year.

Update : Revised Target for Reliance is now 500 in one year.

9.PTC INDIA LIMITEDTarget of 125 in one year.It should now be 150 in one year

Revised target for PTC should now be 250 Rs.

10. Sun TV Network LimitedTarget of 450 in one year time. Has good potential in terms of revenues..

11. GMR Infrastructure Limited - My favorite pick.Hold this for 3 to 4 years to reap a multi fold bonanza in this. Target of 2000 in 2 years and 4000 in 4 years.My favorite pick only did not perform as well as it should but I still maintain my targets as it will catch up soon on any news. Hyderabad Airport will start one month ahead than expected start of march 2008.

Update : Post Stock split, GMR Infra target is 550 in one year.

12. IDBIGood banking stock with value unlocking to take place. Target of 175 in 6 Months time.Target revised to 250 in next 6 months.

13.STATE BANK OF INDIAValue Unlocking and lot of potential left in this. Target of 2500 in one year time.We should see target of 2500 in next 6 months.

Update : SBI should now move to 5000 in one year due to value unlocking in subsidaries.

14.RELIANCE CAPITAL LTDAnother good stock to buy. Stock has potential to give 50% returns in one year. If bank licence is obtained stock may give 100% returns in one year.It has moved up from 1000 levels to 1800. Revised target is 2500 in one year.

Update : Revised target achieved in another month. Now the target is 4000 in one year.

15. Powergrid Corporation :Target of 200 in one year. Buy at dips in correction phase around 90 levels.

16. Jai Prakash associates :Stock split from 10 Rs to 2 Rs approved by share holders. Buy for Target of 2000 in next one year from current levels of around 1275.


Speculative Stocks or Punters Favourites

1.IFCI LTD
IFCI has announced good Q2 results. Stock should be re rated and hence for long term it can go to 250 Rupees. Long term investors can stay put in this for next 1 year.For short term investors 120 to 15o Rs will be there in next 4 months.

Update : Hold till the bids are finalised and the price to be known. I expect it will be 150 Rs by this month end. Long term holders can hold on to free stocks as the value can be 300 in one year.

2.JAI CORP LIMITED :Stock split to 1 rs and bonus of 1:1 given which gave 20 shares for 1 share held.Target of 20000 already achieved instead of 10000 given on Sept5th and it is moving to 25000 now. ....This call is closed now...Hold on to your free shares....

3.NAGARJUNA FERTILIZERS LTDStake sale rumour making this stock move up fast. Target of 60 being predicted.Target achieved. Sources now suggest 100 Rs on this similar to IFCI.

4.TELEDATA INFORMATICS LTDStock keeps moving from 55 to 70.Keep track and buy. Target of 125 in one year if demerger takes placeTarget should be reached now as high court approval achieved. Wait for Re listing to happen which is likely to be around December 19th.

5. Arvind Mills :I had asked to buy around 55. Target of 70 is achieved. One can exit from this and remain only in zero cost shares now.I will keep adding more stocks to this list and the link will be shown in my market comments so that it will be easy to pick.

Market Comments - Waiting for Next Trigger

Markets are waiting for the FED decision and the majority consensus is that the rate hike will be 25 bps. If FED goes for 50 bps we may see market exploding and racing to 21K in a jiffy.

IDEA cellular is going to be there in NIFTY from December 12th. I think IDEA is undervalued when compared to its peers and since it is going to be part of NIFTY component there will be some good amount of buying by INDEX Funds. It is around 136 and I expect a target of 200 Rs in next 3 Months.

IDBI should soon cross 200 mark and then race to 250 Rs. RIL will also explode once the new rally starts and will cross 3000 mark. We should soon hear about stock split from RIL.

Monday Morning Market Musing - Markets await FED Rate Cut

Markets were volatile on Friday as at every rise there is some profit booking seen but at the same time the selling is getting absorbed with new buyers coming in.



FED is expected to make rate cut in its meeting on 11th December and there should be a rate cut of 0.25%. This should fuel further rally in our markets. However we are at a level once again where there will be lot of volatility and only stock specific activity is needed.



Many of the blog readers have asked me about the right time to enter GMR Infra. Please remember that you can actually enter a stock any time if you find value in that stock. One should always be prepared for the dip in the stock and treat it as opportunity to make more money. GMR Infra has a very good business model and it is a stock one shoud hold for long term to reap benefits. I expect GMR to touch 550 Rs in another one year and this could change if GMR bags a couple of Airports. GMR is going to soon come out with IPO for its subsidiary GMR energy which should straightway give additional 25% valuation to the current price.



Reliance Petro is likely to start its operations in June 2008 and I have tried to do some analysis on the kind of Revenues it is likely to make based on its parent company.



Reliance Industries is likely to have an EPS of around 110 for this year and around 145 for next year. Reliance has about 54% of its profits from Refinery business which means its EPS from refinery will be around 80 Rs next year.



Reliance refinery capacity is 660,000 bpd where as RPL is going to have capacity of 580,000 bpd. Reliance equity is 139 crores where as RPL equity is 450 crores. Based on the equity and capacity RPL should make and EPS of around 25. However since RPL is in SEZ zone and there will not be any taxes, the EPS will be around 35.



Now in the first year of operation in 2008 starting in June for 10 months RPL should make an EPS of 28 and even assuming it does not start full capacity from day one, EPS should be 20.



In 2009, RPL should make an EPS of atleast 50 running to full capacity. This should give RPL a fair value of atleast 1000 Rs on a 20 PE ratio. so RPL should be value around 1000 by March 2010. If market gives more PE Of 30, the target can be achieved much before that.



Reliance Industries is around 2800 but has lot of value. Reliance plans to double its existing refinery capacity by 2012 and has good amount of stake in RPL. If RPL prices increases, it indirectly benefits Reliance. I expect Reliance to go for stock split around 3000 levels or worst case at 4000 levels. The stock split should from 10 Rs to 2 Rs. Post stock split Reliance should touch 2000 Rs again in next 2 years which means 10000 target on current price.

Each stock I recommend has some growth story or the other in it. Speculation stocks may or may not click but one can try their luck in them. All the speculation stocks that I recommended have clicked.
There are many investors who are stuck with stocks because they bought it at higher levels or bought it without any analysis and since those stocks lack growth, their prices remain stagnant.When they see all other stocks zooming and every one making huge profits, these investors would definitely cursing themselves and praying to god like the famous adnan sami song.

"Kaise kaison ko diya hai

Aise vaison ko diya hai

Mujhko bhi to lift kara de

Thodi si to lift kara de"

Invest with Confidence and invest in stocks with good growth story, then you need not ask anyone to lift you..... :)

GMR Infra QIP Placement at 240 Rs.

There is news by CNBC that GMR Infra has its QIP placement price at 240 Rs for which market speculation was 280 Rs. Market was disappointed on this news and precisely stock was hammered down. GMR Infra was already in F & O ban and the news of QIP placement at 240 Rs worsened things.

However if you see the positive angle, QIP buying GMR Infra at 240 means, the bottom is limited below 240. Anything below 240 is a bonus for those trying to enter GMR Infra.

Official Information to the stock exchanges is awaited.

Market Comments - Profit Booking

Markets touched 20K peak again and NIFTY recorded all time high and so it was time for some profit booking. This is common practice and there is nothing to worry. Bulls are in firm control and so there is nothing to worry. Unless we have shorts created, how can the markets move up?

GMR Infra crossed 95% of market limit and once this figure was being reached, every one started booking profit. This resulted in stock going down from 269 to 257. There is nothing to worry as it will move up again with the bottom possibility being around 245.

Reliance Petro moved up smartly on Kuwait company trying to invest aggresively in Oil sector in India. They are looking for Indian companies and Reliance is one of them. This shows that even if Chevron decides to exit, there are many others willing to take the stake. I believe that many companies would not hesitate to get the stake at 350 Rs also as they are sure that it would give them more than 100% returns in 2 years. Where would you get such returns in this world?

Many of the blog readers have asked me to give seperate Info on F & O and I will start this feature in my comments from Monday. However please remember that F & O trades is very risky and unless you have very good capital to invest, please do not invest. Sometimes it is beyond the control of any good analyst and so there may be huge losses.

For example : If one had bought RPL at 290 in F & O, one would have suffered a loss of more than 3 lakhs when it went to 190 levels. There would not be any other way but to square off the position in F & O, where as in in equity you can hold this. However, I will give some tips in F & O for those who want to trade, but be cautious in this and invest in F & O with your profits only which is a good thing.

RCOM should move up as the Spectrum issue seems to be resolved.

Market Comments - Scaling Back 20K

Good Morning to all of you and thanks for the overwhelming responses that have been put by all the readers. I am not in a hurry to restrict this blog but I will let you know the plans for restricting the blog.

As I had mentioned in my comments yesterday that Bulls were in control of the situation and they had seized the iniative yesterday itself and with US Markets in green and rallying smartly on good economic data we should see Bulls scaling the 20K peak again.

There are few investors who try doing lot of Analysis and calculations before they buy. They must remember that stock picking is an art and it is not restricted to the basic calculations alone. One should be able to see beyond the numbers and then decide on investing.

GMR Infra is one stock where investment would not be possible if you look at the numbers. GMR Infra EPS for current year may be around 2 and if you see the price, the PE ratio will be 130+ and it is raring to touch 300 very soon once the GMR Energy IPO is finalised.

There is lot of confusion on GMR Infra EPS and if you see the BSE site it does not show the consolidated EPS for GMR Infra group and instead only GMR Infra standalone EPS is shown which will then make the PE Ratio run into few thousands. Many investors missed investing in GMR Infra because of all this calculations. GMR Infra is one stock which has excellent mix of business and is definitely a multi bagger if you have patience to invest.

RPL and RNRL are moving because of the future that is lying for the stocks. Those who want to enter this stocks now can enter and forget this stocks for a year atleast. One should be ready to buy the stocks at every dip of 5% and invest without any fear.

Teledata has given the required seven day notice to BSE on Decemebr 4th for listing of Teledata Informatics. Based on this, Teldata should list on December 12th or 13th. Once Teldata Informatics lists, the other two demerged entities should list by end of December. Good luck to all teldata investors. I advise all the investors in this stock to hold on to the three demerged entities for atleast an year to reap rich benefits.

IFCI will most probably fetch you 150 Rs for short term. This will be known after December 14th and it will be around 300 Rs in one year. Long term investors can continue to hold the free shares if you already made in this counter.

IDBI will be one star performer in long run after SBI. Watch out for SBI, IDBI and ICICI in banking stocks.

Powergrid, NTPC and PTC will be stellar performers in power sector. They will move up smartly till Reliance Energy IPO goes through.

Nagarjuna Fertilisers has already crossed my target in the speculative stocks list and it should now reach 100. Arvind Mills will also move up smartly as there is talk in the market about demerging its retail arm.

Market Comments - Nothing to Worry

Markets are in consolidation phase and there is nothing to worry. Bulls are in control and will strike back as when the consolidation is over.

Reliance Petro is also in consolidation mode and when it will move in fast lane is the decisive thing. There are some sources which say that RPL can cross 300 and even touch 350 this month. This is some speculation that is going on in the market and there are already some takers for this if you see the 300 call going around 3 Rs which means there is some possibility of this theory though timing a stock for short term is difficult. However buy at dips and wait patiently in this stock for 1 year atleast. If you are a short term investor then have patience for atleast another 4 months before you get some real profits.

IFCI has touched the F & O limit and so is consolidating. Please continue to hold this till the final news of bidding is out. I expect IFCI to fetch 150 Rs eventually.

Reliance Communication did not perform as expectedly and this was one stock that is lagging behind. This could be due to the issues with DOT and once this is sorted out it should zoom to new heights. Keep an eye on this.

I would like to have your feedback on this blog and very soon I am planning to restrict this to registered users only. Please post your feedback.

Market Comments - Bulls in Control

Bulls were in control yesterday and markets moved up smartly. IFCI was the star performer yesterday. As I had mentioned previously, IFCI was range bound between 80 to 100 till the financial bid news came.

IFCI has now put 14th December as last date for financial bids and also interestingly it is offering International Finance Corp. (IFC) which is World Banks arm a 20% stake. We may now see a price of 150 Rs for IFCI from the bidders. Hold on to IFCI till the financial bids are over.

GMR Infra seems set to move to 300 by this month end and in one year it should reach 500 Rs. Reliance Capital is also moving in fast lane and those who entered earlier can hold on to this stock for further gains.

Monday Morning Market Musing - Stock Specific Activity

Markets will continue to be range bound between 18K and 21K for few more months atleast as we had already run up way ahead of fundamentals and so this type of consolidation will keep happening.

Focus on specific stocks and make money in this market. Whenever market goes down. pick up stocks and try to make some free shares by selling at higher levels. This way you get good cushion for yourself and also have your capital intact.

Market Comments - Reliance Petroleum's Day Out

Markets moved up smartly yesterday but based on the positions markets had to give up the gains as it was the settlement day in F & O yesterday.

However if there was one stock which hogged the limelight, it was RPL. As I was expecting it to explode any time, it did in style in the last hour. This was presumably because of huge short covering which came at the last minute. Today we will have new series beginning in F & O and so we should see smart rally in the counter till 250 before consolidation. DO NOT worry about short term movements but try to make some free stocks where ever possible. I certainly see RPL around 1000 Rs in next 2 years.

RPL reminds me of the quote that I like " When you do not see Stars in the sky, it does not mean that they have disappeared forever, it is only a matter of time before the clouds move away and you see the stars twinkle again".

One more stock which I consider as a litmus test for myself is Teledata. The listing is expected in another 10 days and so I expect the demerged entities will give a value of around 90 Rs which means a return of 50% in near term. Even if it does not happen, I am sure the combined entities will fetch 200 Rs worth in one year. Teledata Marine solutions will lead the pack as it will be given higher PE ( atleast 5) and it is expected to grow at good pace. Watch out for the listings in December.

Markets should start fresh rally in December series but we will see markets moving between 18 K and 20 K for some time as we had moved up way ahead of time. However stock specific activity will continue.

Market Comments - Bears Trapped

Market opened up smartly yesterday but due to heavy positions that were built in F & O, bulls had to give up the gains and there was a huge rush to square off the positions which led to market ending up in red. However it will now be Bulls turn and we will see a big rally once again.

Infosys moved up 5% in Nasdaq yesterday which means we will see some rally here. It seems that there are lot of shorts built in Infosys and if this happens, today we will see some huge covering and we can see Infy rally smartly.

There were queries regarding Burnpur Cement IPO and based on current grey market premium which is quoting around 8 to 10 Rs, the IPO looks attractive. The issue size is also good and so one may get good allotment in Retail part. If you have enough money to put in IPO, then apply for this IPO. Minimum allotment will be 500 shares which means profit of around 5000 Rs on listing.

Today IDBI, IDFC, GMR Infra, NTPC should rise smartly in Futures due to short covering.

Market Comments - Its Bulls turn now

Markets corrected yesterday due to weak global cues but if you see the amount of correction, it clearly showed that Bulls were in control not letting market fall.

US markets rallied smartly yesterday and hence we will see a very good opening and then there will be the usual volatility before we see good closing. We should see 6000 on Nifty by Thursday if all goes well.

Tech Stocks are taking a beating but as I mentioned it is good to time to add Stocks like Infy and TCS to your portfolio. However the rupee appreciation effect is still there and hence add theses shares only as part of your free shares and wait for 2 to 3 years.

GMR Infra is buzzing on stake sale at 280 Rs to QIP and hence it moved up smartly even though it was in F & O ban. All depends on the positions during settlement time.

I will write more about Reliance Petro only after it crosses 300. When SBI was 1000, many analysts downgraded it to 600 levels but where are the so called analysts now? SBI moved up smartly to cross 2K. Same will happen with Reliance Petro. Imagine why will any one buy 18 crore shares at 223 Rs when there is no value in it. Rest is your call.

Minda Industries is being accumulated and should move up smartly to 300 Rs in one month's time.

IDBI will move smartly to 200 Rs in quick time as NSE is likely to offload some more of its stake and IDBI has stake of NSE and also IDBI has stake in Mundra SEZ and hence it should move smartly to above 170 levels today and then closer to 200 levels.

Market Comments - Volatile Markets

Markets may be volatile for the next few days but one requires patience and careful selection of stocks to make money in this market. Those who are long term investors can just buy the required stocks and then forget about the market till the desired time.

Those who are looking for short term gains as well as long term investment must be watching the markets carefully to make money and then ensure that more shares are added to the zero cost portfolio.

Reliance Petro opened up smartly but then there was again huge interest for this counter and it crossed 95% limit again. Bears sensed this and hence there were lot of shorts in this counter. I believe this will explode any time but when is the big question? It will be very soon.

With petrol prices increasing one stock which is going to make news is Minda Industries which manufactures LPG kits for maruti. It is currently at 247 and it should cross 300 in quick time. I believe it should touch 500 in one year as there is going to be heavy demand for gas kits in future.

Mundra SEZ port lists today and it should list around 1000 to 1200. Those who want to invest for long term and did not buy in IPO can go for it and start accumulating if it dips.

Teledata Informatics is likely to list around December 10th and the other two demerged entities around December 26th.

My stock picks link.
http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

Monday Morning Market Musing - Settlement Time

Markets will be volatile this week but I believe bulls will have an upper hand unless we see very bad global cues. I think we should test 6000 on Nifty Once again though it is my guess but volatility is going to be there for sure.

Reliance Petro is out of F & O ban and watch the action in this counter now. GMR Infra will be subdued because of F & O curb but since this will be for few days we should see action in this counter once the placement news on this comes out today.

IFCI will move once again towards 95 and then book profits again.

Reliance Petro Out of F & O Ban

Reliance Petro has come down below 80% of the F & O Limit and is out of Ban for November Series. Interestingly, Reliance has made 4% stake sale ( 18 Crore Shares) of Reliance Petro on Friday, for a sum of 4023 crores rupees to Institutional investors which works out to 223 Rs per share.

I had said in my comments on Friday to watch out for RPL in coming days as it was about to get out of F & O ban. Now see where the stock opens on Monday and how it zooms......

GMR Infra is now in F & O ban and so the stock should be subdued till it comes out of the F & O ban or till the December series starts on Friday.

Market Comments - Its Bulls turn now

There are few investors whose nature always puzzles me. They wait for market to correct before they would like to buy and when markets correct, they fear to buy because markets can go down even further. They will not be able to buy anything. When markets rise sharply they keep waiting for markets to fall and this repeats again.

Markets took a U-Turn yesterday evening and since this is a long weekend in US, we do not have any global cues to handle with. Markets should open with a bang today and we should a smart rally unless market players have something else in their mind which is very unlikely.

Once markets open smartly, bears will have to come and cover their positions as even tomorrow we will see the run as there will not be any bad global cues to handle with.

Reliance petro is close to getting the ban lifted and it should move up smartly. Just watch RPL in the next few days.

GMR Infra will make smart moves again today and we should it on track to 300.

Powergrid, PTC, NTPC will dazzle again. Reliance Industries, DLF will also make smart moves.

IDBI, SBI will continue their march.

IFCI will move again quickly to 95 plus levels. One more opportunity for you to make some more free shares.

Enjoy the rally!!!!!!!!

Market Comments - Another Opportunity

Markets have gone down as expected. This was inevitable as I had been mentioning that we were overvalued and markets need some correction. We will see this happening for some time till we move to 21K.

Markets will correct today also but we should see some bottom around 18K or close to 17,500 in the worst case. I believe we may test the bottom soon and sharp rally will resume again.

Reliance Petro is one stock which will rise sharply and I believe it will give excellent returns in one month and it can even touch 300 Rs giving 50% returns in one month. This is one stock which is resilient even in falling market due to the reason that there are many shorts in this counter and so it can explode any moment.

Teledata Informatics will list around December 3rd and the other demerged entities should be listed by end of December.

GMR Infra touched 250 and corrected yesterday but we will see sharp rise once the market stabilises.

IFCI has crossed 95 to go till 105 and then now back to 85. This type of opportunities keep coming in IFCI and so buy now again around 80 levels to sell at 95.

Nagarjuna Fertilisers and Arvind Mills my stock recos in Speculation list have already hit the required targets.

Market Comments - Weak global cues

We had another day of weak global cues and our markets would also react negatively to the global cues on opening today and then there will be some volatility before we see some negative closing.

GMR Infra crossed 250 and next target is 300 Rs by December End. There is speculation in market that GMR Infra has reportedly bagged an airport contract in Europe.

Reliance Petro is going down because of consolidation and also oil prices retreating back. This stock will now be tracked on Oil prices and may move down to 180 levels on the downside but 400 Rs target in next one to two months is not ruled out as there is reportedly a stake sale happening around 350 Rs similar to GMR Infra at 250.

IFCI has moved smartly amid speculation of banking licence in the market but as usual book profits around 100 Rs and make some shares free of cost. It will give another opportunity at 80 levels.

PTC has already doubled from my recommended levels in less than 3 months and NTPC should cross 300 anytime after market stabilises.

Monday Morning Market Musing - Fear and Greed

Good morning to all my readers. It is Monday Morning and time to put on thinking cap. There has been lot of inflows in the last few months and with this the bulls were creating new records and sensex was moving from one milestone to another.

This has bought in new expectations from the investors and they are so high, it is akin to asking Yuvaraj to hitting six sixes an over every time he comes in to bat. Investors now want 50% to 100% returns in less than a month. Is this possible ? No.....It is expecting very high returns in quick time. Normally if you get a return of anything above 20% in a year, it is considered as good returns in stock market since we get less than 10% in an FD.

However there have been many stocks in the past few months which have given more than 50% returns in less than 2 months and some even 100% returns. I had infact given 100% returns as target for one year but they were achieved in a month.

Now investors are caught in two minds, Fear and Greed. They fear that stocks might go down and would like to sell but at the same time they do not want to sell because there is further scope for increase in price.

The best thing to do is keep booking profits after certain levels and also make free shares ie zero cost price and forget them. In this way you need not worry and you can forget the two factors fear and greed. When to exit a stock is difficult to stay but the best thing is to set some target and book profits and then leave some shares free of cost. Always get back your capital at any time and play with free shares.

US Markets tanked on Friday again and we may see some more weakness in our markets this week. Time to buy my stocks at lower levels as you will see another upmove after consolidation.

Market Comments - Consolidation Phase

Markets Consolidated yesterday and there will be some more consolidation before the uptrend resumes. GMR Infra moved up smartly as it was out of F & O curb and is now moving towards 250 mark. GMR Infra has been my favorite pick and though it had not performed when market moved close to 21K earlier, it has picked up offlate.

From 150 levels it has moved to 225 levels giving returns of 50% in less than 2 months time. There is lot more to come in this stock as Stake sale is likely to happen at 250 Rs which means target of 400 is not ruled out in this stock by next year.

Reliance Industries is going to perform well and my target will be 4000 in next 6 months.

Reliance Petro will fire the moment it is out of F & O curb and it should reach 300 in a jiffy. At present consolidation is going on.

IFCI moved up smartly and as I said many times it keeps moving between 80 to 95. Anything below 80 you buy and anything close to 95 or above you sell. Keep making free shares in this with above ups and downs.

IDBI, ICICI and SBI are three banking stocks which will give you good returns in next one year.

DLF is going to move to around 1600 which is my revised target from earlier target of 1200 in one year.

Opportunities will keep coming in this market and so keep visiting my blog for more info.

I hope all my blog readers are having happy time in investing in my picks.

Market Comments - Bulls Create History

As I had mentioned in my comments on Wednesday that we were close to bottom and Bulls were ready to take charge and even a small rally in US markets would make the markets rally in a big way here. US Markets closed up in a big way on Wednesday and so we had a record rally yesterday.

We will see some consolidation today and an attempt to move to 21K. It will be interesting to see how soon we can reach 21K. However it is not so easy to get to that mark. I hope bulls prove me wrong.

Reliance has moved up smartly and raring to go. There is news that Reliance may go for stock split after it crosses 3000 and ex stock split it may give value upto 4000.

Reliance Petro is unable to move due to the huge positions built in F & O and unless it comes out of the F & O curb or short covering takes place, it may not move. However I still believe it has potential to cross 300 by December End.

GMR Infra is also in F & O curb but as per sources there is some placement likely to happen at 250 Rs per share which means GMR can cross 250 very soon. More information will be known after 26th November on this.

Teledata is going to ex-demerger tomorrow and even conservative estimates suggest that the demerger value should be around 90 to 100 Rs for the three entities combined. The only thing required is patience in this counter.

Nagarajuna Fertilisers moved up smartly and it should now move towards 80 levels.

IDBI and SBI willl give good returns and still have lot of potential. Stay invested for one year to get returns in these.

Powerstocks have flared up considerably and still have some potential to go till REL IPO goes through.

ICICI Bank was another bank stock which I recommended and it has started moving up smartly.

My stock picks link.

http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

I will add some more stock recos soon.

Market Comments - Bulls in Full Flow

Sorry for the late update but there is not much to write today. As I had written in my comments yesterday, US markets moved up smartly on good earning news and so here our markets raced up on opening. This was what I was mentioning and so all stocks should move up smartly.

Teledata moved up smartly yesterday and today also it should close around 72 levels and tomorrow it should touch 80. I hope this happens but even if this does not happen, nothing to worry on this. You will get good value after demerger.

I hope every one of you is enjoying the ride. Catch you tomorrow with more news....

PE Ratio - How prices are effected?

Many investors go by the EPS and PE ratio for a particular stock but sometimes things can drastically wrong or there can be surprising rewards in this.

Take the example of Infosys. Infosys was the favorite stock in IT pack even till 9 months back. Infosys had an EPS around 90 in FY06 and there was also a bonus of 1:1 and Infy moved to 3500 cum bonus commanding a PE of 40 on FY06 earnings.

In FY07 the EPS was 136 or ex-bonus it was 68. But the rupee effect started showing some effect and the PE ratio was now 34 only. Infy moved to a maximum price of 2400 Rs.

When the rupee started sliding further and Infy gave conservative guidance of 80 we are now seeing the stock at 1600 levels which means the PE ratio has come to 20. If only the rupee had not depreciated Infy should have ideally been around 2700 Rs to 3000 Rs.

This is how a small change in PE ratio can effect the share price of even a blue chip company.

Take another example of Reliance Industries. Reliance used to command a PE of 10 till 2004 and when the EPS was 60 Rs stock was quoting around 600 Rs or something like this.

It all changed in 2005 after the demerger. PE ratio of Reliance started increasing and now with annual EPS expected around 100, Reliance is close to commanding 30 PE.

Reliance Petro EPS is not known but only we have few analysts estimates. It was expected to be 5 but with increasing oil prices I believe this can be even 10 in the first year. Giving a PE ratio of 50, Reliance Petro can move up to 500 Rs by end of FY09 but market tends to give more PE for stocks and sometimes it can even be 100 also which means Reliance Petro can move upto 1000 Rs by FY09. This is based on presumption that oil prices will keep moving up and stay around $100 atleast. What happens if they drop back to 70 levels? Markets will then give less PE ratio and even say 30 PE and price can come down to 300 Rs from 1000 Rs. This is how PE ratio can effect stock price.

Consider an interesting scenario for Infosys. If govt is forced to increase petrol prices and if petrol prices move up by 6 Rs atleast then inflation will increase and rupee will start downward trend and dollar moves up. If rupee touches 42 to 43 level again, Market will give higher PE valuation to Infy and in Fy09 if Infy can clock an EPS of 100 and PE ratio is 30 then the price can be 3000 Rs. That is almost double from current levels. But the million dollar question is....when will the rupee go down? Any guesses ???????????

Market Comments - Close to Bottom

I believe we have seen good amount of correction and yesterdays rally was because of frentic short covering by bears. US markets corrected yesterday but it was not a huge one and every respite in US markets will give good opportunity for our markets to rally. The day US markets close in positive, we will see a huge rally and when there is correction, we may see a pause.

Markets have corrected significantly and hence the bubble phenomenon is now gone which is good for the health of the market. We will however see the swings between 17 K to 20K and it will take significant time before we see 21K. However specific stocks will keep moving.

Power Stocks have moved up and NTPC sparkled well. I had recommended IFCI, NTPC, Relpetro for futures trade this month and IFCI profit booking was done around 95. RPL sparkled to 290 and NTPC now at 257. I will keep giving few stocks for trading in F & O so that those who can trade in F & O with good amount of money can do their trades.

Teledata has corrected with market and it may go down to 55 levels also but of late it has bounced back from 58 levels to 63. DO NOT worry about the price now and be patient. It will fetch the desired results.

IFCI sale stake may be delayed is the news and hence it will be in the 75 to 95 range for some more time.

I will try to post the PE ratio post today.

Monday Morning Market Musing - Weak Global Cues

I hope every one of you had a good Diwali though markets did not sparkle on Diwali Muhurat trade. This was the first muhurat trade in last seven years where markets closed in negative.

This was precisely due to the reason that Markets had run up too fast. If you my remember my comments earlier, I was mentioning how markets were running ahead of fundamentals and so correction was imminent. The much desired correction is happening now and we may see some more downside before we resume the rally again. The reversal will be sharp and fast like it happened at 13500.

Focus on specific stocks and buy. GMR infra finally crossed 200 and I am happy that it has crossed this resitant figure of 200 and now we should see 250 as the next target once market reverses. We may see some stocks move up eventhough markets are in negative and Reliance Petro could be one stock where the run up will be huge. Please see my another post which I will be postigng seperately which will explain how quickly valuations can change a stock price.

It will be interesting to see how Teledata price will be in the correction mode as the ex-date for teledata demerger is on Friday. There is nothing to worry about Teledata as I know the value for the shares after demerger will be much more than the current value and so there is no need for panic to sell Teledata. It is a safe bet in this falling market.

Buy in this market as per your comfort levels and wait for the reversal. Opportunities keep coming. It is for you to utilise them.

Market Comments - Global Melt Down

US markets tanked yesterday and there is a sell off in Asian Markets today. Our markets will also open weak and there will be volatility again in our markets today. We may see below 19K today and this should trigger some panic in the market after a long time.

Forget about sensex and keep adding my stocks as per your comfort. Oil prices are close to $100 and this can increase further. There were a few Analysts who say that Reliance Petro can touch 1000 Rs in next 2 years based on the expected increase in oil prices. Though the valuations are expensive, considering the fact that RPL will start operations atleast 6 months before the original completion date of December 2008, it should have good earnings in the first year. I had expected an EPS of 5 in the first year for RPL but this can now be even 15 based on the oil prices and in the next year it can even go to 30. 1000 Rs for RPL is surprising but the way oil prices are moving up, it should not be impossible for this stock.

RPL had reached the limit in F & O for this month and hence there was a big sell of in this counter. This is the first time a NIFTY constituent has touched the market wide limit. However we should see good buying opportunity in this stock if you have long term vision.

IFCI will still remain in the same range till the bidding news is out but if you try to stay put in this counter with your free stocks, you can get 400 to 500 Rs in next 2 years.

IDBI, SBI are still on course and they should give decent returns in next one year.

PTC and NTPC are good bets in power sector and powergrid also is one of the good stocks to buy in the correction mode though it refuses to come down much.

Infosys is close to the bottom and so is TCS. Try to accumulate these two at lower levels for a quick rebound. However try to put your profits in the IT stocks as the rupee effect is still going to have effect on IT stocks. If you are a long term investor with 3 to 4 years vision, then buy and forget these.

"I wish all my readers a HAPPY AND PROSPEROUS DIWALI".

I hope many of my stock recos will give 100% returns in one year and my pick of the year will be TELEDATA and I hope to see a 300% return in this by NEXT Diwali.

Market Comments - Buying Opportunity

Markets are correcting because of profit booking but this was bound to happen as the run up was sharp and 20K is a big hurdle to cross.



This is another buying opportunity and so add value picks at every dip. Teledata dividend has been deferred and I feel it is good because there could have been legal hurdles with the dividend declaration. Dividend will act as another trigger after the demerger and I see teledata should touch atleast 80 Rs by 15th November and the demerged entities should give good value and the combined value will be 100 Rs after the listing.



There is nothing to worry but pick value stocks at every dip and wait for the reversal.

Market Comments - Nothing to Worry

I was busy with my scheduled work and so could not post my 4M post yesterday. Markets corrected as 20K seems to be a difficult mark to close above and also US economy worries are lingering now but I feel lot of money will flow to India for investments and we will see reversal very soon.

Last time from 13500 markets appreciated by 50% and now we may not see that deep correction but try to accumulate my recommended stocks at every level. See the link below for my stock picks.

There is speculation of Reliance going for stock split from 10 Rs to 2 Rs once it crosses 3000 Rs and so try to buy at dips so that you get good appreciation post stock split.

GMR infra has started moving up slowly and we may see it cross 200 after market stabilises.


Stock picks link :
http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

Market Comments - Volatile Markets

Markets rallied smartly yesterday in the morning as expected but as I was saying that it was like playing musical chairs and so some one decided to stop the music abruptly. Profit booking started and though there was some recovery, panic was evident in the market as correction started. 20K is being like a tough point for the market to close.

US markets tanked yesterday as further rate cut seemed unlikely and also economy slowing down. Our markets will react to this news but once we see good correction, rally should resume again. This should provide good opportunity to buy again.

IFCI tanked again to 80 levels after reaching 95 and again a good chance to buy now. I am sure one will get another 3 to 4 opportunities like this.

Focus on specific stocks and buy accordingly in the correction mode.

Market Comments - FED cuts to boost Markets

FED has cut interest rates in US and this will boost our markets today. We may now see 21k at the current frenzied pace as at present all fundamentals are being set aside and markets are moving up like anything. Interest rate cut in US would further boost inflows here which means we will see further up move for market.

Religare IPO is good but since the issue size is small it will get oversubcribed heavily. Apply for this IPO only if you are sitting on huge cash as the allotment chances will be very less. It was oversubscribed 13 times in retail part yesterday and so on last day it should get oversubscribed nearly around 80 times or more.

Barak Valley Cement is also small issue and allotment chances will be less as this should also be subscribed around 25 times. Invest only if you are sitting on huge cash or you would like to take a chance with allotment.

We should see rally in stocks now like Reliance ind, Reliance Capital, Reliance Energy, RNRL, SBI, IDBI, IFCI, GMR Infra, DLF, Unitech and all my recommended stocks but we are in a situation of musical chairs and the music is now playing. When the music will stop is a big question which is difficult to answer at present. Any way I will be there to let you know before the music stops. Till then play on !!!!!!!!

Market Comments - Waiting for Direction

RBI increased CRR by 0.5% as I had expected though very few expected RBI to do this. Markets were surprised at the move but Profit booking had to come as we rallied smartly already. I have been mentioning that 20K would be difficult to cross as Valuations look stretched and so we will have to keep moving in a range for some time.

Stock specific activity will become order of the day as some of the stocks in Reliance group are quoting at 2012 valuations. There has been some frenzied run in the Reliance group stocks and even any amount of negative news can take the markets down. FED decision is expected today and so this will be one of the key factors before markets take direction. We are at a stage where some correction is required before we decisively cross 20K.

Reliance Energy valuations are being increased due to the huge valuation of its AP project and 3000 is the target that is being talked in this. Those who have bought at lower levels can stay put and those who would like to enter should wait for markets direction before taking a plunge in this. NTPC will move on REL price movement.

IFCI will keep moving in the range of 80 to 95 for some more days. GMR Infra had some movement yesterday but it should cross 180 decisively before it can cross 200 and then to 250.

RPL is moving based on the international oil prices but the valuations seem to be stretched a bit but whatever seems higher moves further up in this stock market.

Teledata is still being accumulated and very soon I believe there will be upper circuits in this stock. The key event for this will be November 5th when the dividends will be announced and if the combined dividend is 3 Rs also that will augur well for the stock and I believe management knows the expectations from the market about the dividend. This is one stock which looks a safe bet in this market.

Reliance Capital, RPL, Rel Industries all are approaching my revised targets once again and whenver I revise the targets for one year, they are getting done in one month :)

Markets should open weak today and there should be some volatility in the market before the key event unfolds today.

Market Comments - Wait for Key Events

Wait for Key events to unfold before deciding on the next course of action. You can book profits partially and then wait for the markets to take next direction.

Due to my busy schedule today I am signing off now and will update you later in the evening.

Monday Morning Market Musing - Stock Specific Activity

US markets closed in green on Friday and so our markets should open up smartly. We will then see some consolidation and I still feel that Bulls will have to sweat it out to reach destination 20K. I have some feeling that there may be a CRR rate hike to spoil the Bulls party tomorrow but this is only my assumption and if this rate hike does not happen we may see 20K soon.

The reason I feel RBI may increase CRR is to suck out the excess liquidity in the system. However there are many analysts who feel that RBI my go for a rate cut but I feel this is a bit difficult. If the rate hike happens markets may correct sharply as we are at higher levels. Any way let the key event unfold tomorrow. Focus on specific stocks and stay invested forgetting about the sensex.

There have been many questions on teledata informatics. Teledata Informatics Face value is 10 Rs but after the demerger all the three companies face value will be 2 Rs and for present 100 shares of Teledata of face value 10 Rs one will get 100 shares of Teledata informatics of face value 2 Rs and the other two companies Teledata Marine and Teldata Technology Solutions of 50 Shares each. This is the demerger process and the original equity of Teledata has been converted in the above format.

The EPS values that I have mentioned in the teledata message is post demerger process and not the current EPS. There are many contradictory views on teledata with many people suggesting the poor management of the company as one view not to buy but there are thousands of companies which are not even in profits but quoting at heavy price.

Teledata is quoting at low PE and also demerger will always results in giving better valuations. There is minimal risk in buying Teledata at current levels and chances of making good returns are much higher.

Teledata board is meeting on 5th November to consider interim dividend. I think share holders of teledata must be pleased with this announcement and if the dividend declared is 2 Rs, 1 Rs and 0.50 paisa for the three demerged entities, the share holders should be happy with this as this is an interim dividend and so another dividend will come up with year end results.

Buy Teledata and sit tightly without heedin to any rumours. Forget this as an investment and hold on for long time. You will then see manifold returns in this. If possible try to put your profits in this and forget this for atleat 1 year or till you get good returns whichever is possible. I am assuming 90 Rs as the least price by and 200 Rs on the higher side by Jan 2008. All the best to you !!!!!!!. However if the markets go down or reasons beyond my analysis, stock may see downside from current levels but you need to hold on to it for atleast for one year. One should be prepared for the downside always and be ready to hold it for long time. All the best to you !!!

SBI crossed 2000 Rs and is moving towards my target of 2500. IDBI should cross 175 Rs by this month end unless RBI spoils the banking party.

IFCI will be moving between 70 to 100 and close to 100 book profits and enter at lower levels again. However always keep some stocks of IFCI as you never know when this will zoom on news of bidding.

Rel Comm has not moved up as expected but it will soon catch up. Infosys may move up on restructuring of its business units.

NTPC will catch up momentum in coming days as REL power IPO will start in November.

Teledata Informatics - A great Opportunity to Buy

Teledata Informatics is a mysterious stock which is grossly undervalued and gives a chance for all investors to get great returns from current levels.

Teledata is going to be demerged into three entities .
1. Teledata Informatics
2.Teledata Marine Solutions Ltd
3. Teledata Technology Solutions Ltd

For 100 shares of Teledata Informatics, each share holder wil get 100 shares of Teledata Informatics ( Face value 2 Rs) , 50 shares of Teledata Marine Solutions (Face value 2 Rs) and 50 Shares of Teledata Technology Solutions (Face value 2 Rs).

Teledata has got approval for demerger and even the record date for demerger is fixed. 16th November is the Ex-date for this. All those who buy shares of Teledata upto 15th November will be eligible to get the shares of Teledata informatics Ltd carrying a face value of Rs.2 against its original face value and that of Teledata Marine Solutions Ltd and Teledata Technology Solutions Ltd.

Teledata is currently hovering around 65 Rs and operators are trying to suppress the price and grab more shares.

After Demerger Teledata Info EPS will be 21 and even PE of 3 will give Value of 63 for Teledata

and Teledata Marine Solutions EPS will be 16 and PE of 3 will give 48 Rs value in this and TTS EPS will be around 8 and PE Of 3 will give value of 24 Rs.

I am just assuming safe PE of 3 which is the minimum kind of thing and so combined value for 100 shares of Teledata will be 6300 + 2400 + 1200 = 9900 Rs.

There will be minimum returns of 50% on investment of 6500 Rs. This returns will be in 3 Months approx after the listing of the demerged entities.

Hold this stock for 2 years and you could see atleast 10 times returns.

Market Comments - Bulls in Control

SEBI has finally decided on the P-Notes issue. There are not major changes from the original draft which was announced two weeks ago. Markets should set this P-Note issue aside and now only the interest rates are of interest to market. It will be interesting to see the opening moves today as there could be lot of volatility on the P-Note front.

There is lot of specualtion in US that FED will cut interest rate and even RBI could cut CRR. However even if these events do not happen, markets should now move to destination 20K. Though the valuations appear stretched, bulls are not allowing bears to strike back and henc they are controlling the market.

IFCI made smart move yesterday and those who bought it in Futures might have made good money. NTPC and PTC should perform well due to REL IPO and my targets for November are 325 in NTPC and PTC should reach 150. These will depend on market conditions and other cues which keep changing but I am sticking my neck out and giving the targets. IDBI should touch 175 by November End.

IFCI will keep moving between 75 to 100 and so keep playing in this counter till it crosses 100 decisively. This will happen after some news on bidding is known.

GMR Infra is stagnant for quiet some days but please be patient in this for next few months and you will be rewarded for your patience. It is a great stock worth holding for atleast next 3 to 4 years. It will give you amazing returns.

Market valuations are bit stretched and we may see some meltdown in future but when will this happen...DO NOT worry about this....I will guide you... "Main Hoon Na....."

Market Comments - Key Events to decide market direction

Markets have become volatile and they will be expected to remain so till 31st October. Today SEBI is going to decide on the P-Notes issue and the outcome is keenly awaited.

FED event lined up next week and RBI meet this month end are key events to watch for. Markets believe there will be another FED rate cut and even RBI is expected to cut CRR by 0.5% which will augur well for the markets and we can see 20K in quick time.

Stay focussed on specific stocks and add more in turbulent times.

Those who are trading in F & O can go for NTPC, IDBI, IFCI, SBI, RPL with stop losses as per their comfort levels.

Market Comments - Bulls in full Swing

Markets created another history recording highest rise in a single day. As I said yesterday that another 1000 points correction was expected but markets do not behave in the way we want. Market has its own style of moving. This was the precise reason I asked you to buy specific stocks rather than focussing on Sensex.

Teledata has got approval for demerger and even the record date for demerger is fixed. I believe teledata will race close to 100 before the demerger. 16th November is the Ex-date for this. All those who buy shares of Teledata upto 15th November will be eligible to get the shares of Teledata informatics Ltd carrying a face value of Rs.2 against its original face value and that of Teledata Marine Solutions Ltd and Teledata Technology Solutions Ltd.

IDBI has started its upmove again and is moving towards first target of 150. NTPC is moving up because of REL power IPO and we should see 25% gains in NTPC by the time REL power IPO is over.

IFCI will also see smart up move. Reliance Capital has moved in fast lane and so also RIL. RCOM should start moving up now. My target is 1000 Rs in next 15 days.

Markets may move up by another 400 to 500 points today. However the volatility will be such that we can see even a fall of 1000 points now on any given day. The coming days are going to be as such.

Maytas Infra is going to list tomorrow. I expect a listing price of around 500 in this scrip.

Market Comments - Stock Specific Activity

Markets are expected to remain volatile as it is settlement time and also SEBI clarifications on P-Notes was not satisfactory. However this is the right time to pick up some stocks which have come to comfortable levels and then plan accordingly for further shopping as and when market corrects. I believe we may see another 1000 points correction but market does not behave as we like. There are certain key events lined up till this month end and one best option is to buy in only the stocks which you feel have come to comfortable levels.

IFCI is at comfortable level to buy. GMR Infra is good to buy at 140 or below level. SBI is good to buy at around 1650 to 1700 levels. TCS is good buy at current level of around 1000. RCOM is good at current levels. Reliance is probably good if it comes to 2200 levels. The list goes on. Check my recommendations and buy at comfortable levels based on the given targets.

US markets closed in positive yesterday but that could be mainly due to short covering after huge fall on Friday. I believe we may see some fall in US markets today and so that will have an effect on our markets again tomorrow. Be cautious in your shopping till 31st October. This week should give good opportunity to buy specific stocks.

Stock picks link :
http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

My other blogs :
http://indianstockmarketsquery.blogspot.com/
http://indianstockmarketsinfo.blogspot.com/
http://calculatemyemi.blogspot.com/

Monday Morning Market Musing - Bears in Control

There is an interesting story which I wanted to share with you on this Monday Morning.

Once upon a time in a village, a man appeared who announced to the villagers that he would buy monkeys for $10.00 . The villagers, seeing that there were many monkeys in the forest, went out and started catching them. The man bought thousands at $10.00. As supply started to diminish and villagers started to stop their efforts, he announced that now he would buy them at $20.00.

This renewed the efforts of the villagers and they started catching monkeys again. Soon, the supply diminished even further and people started going back to their farms. The offer rate was increased to $25.00 and the supply of monkeys became so scarce that it was an effort to even see a monkey, let alone catch it.

The man now announced that he would buy monkeys at $100.00. However, since he had to go to the city on some business, his assistant would now buy on behalf of the man.In the absence of the man, the assistant told the villagers, "Look at all the monkeys in the big cage that the man has collected. I will sell them to you at $50.00 and when the man comes back, you can sell them to him for $100.

The villagers queued up with all their savings to buy the monkeys.After that, neither the assistant nor the businessman could be found anywhere but the monkeys were everywhere!

This is what happens in our stock market if one is greedy ...............
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Our markets corrected last week and the pain has started. Why did this happen? It was due to markets being overheated and reaching milestones in quick time. I had clearly mentioned that markets should correct alteast around 18500 before proceeding further and if this does not happen we will see huge meltdown in markets. Markets raced to 19K and were zooming to 20K but then came the correction.

US markets tanked on Friday and we have seen a big fall. This will cause our markets to open in a big way down and added to this the F& O expiry is on thursday. There will be huge panic in the market today and lot of volatility will be seen.

TCS has won a big deal and so try to pick up some shares in the downtrend. It is a good opportunity to buy in the correction mode. There is no need for any hurry as you are already on the sidelines and you can still remain there for couple of days atleast before the dust settles and we will see some consolidation. Markets will eventually start the journey to 18K and then to 20K but it will take some time as strong hands will enter the market and the correction makes market healthy.

Market Comments - Sense Prevails

Finally some 'sense' has prevailed and markets corrected meaningfully. Reliance industries results were above market expectations but there was no bonus or stock split ie scenario 2 which I guessed correctly. The results came in the evening and not during market hours but I believe the news was sensed by market and so came the correction.

This was bound to happen as I had said that we had seen on wednesday was only a trailer.

What happens next ? Markets may open with a gap up opening again which may give wrong signals that recovery is imminent but selling should come at every rise now.I feel there is still lot of pain is left in the system. Markets will correct further and based on past experience it will take some time before markets recover and they are back on the way to destination 20K.

GMR Infra posted a consolidated net profit of 49 crores but these results are not significant now as the future profits are going to count. Buy GMR Infra from below 150 levels onwards.

Powergrid touched close to 150 as I had said and now see where it goes.

IFCI is giving another opportunity make free shares. Buy at lows and make some more free shares in this.

Rel Comm is one stock to watch out for. This stock did not rise as much as the other reliance pack and is now available at good price. Keep a track on this and buy for a target of 1000 Rs in next 3 months.

Oil prices have touched $90 per barrel and market cannot continue ignoring this. When there is rally all bad news are set aside but when the markets start tanking even a slight negative news is taken in a big way.

Wait for some stability before you buy. Enjoy the show from sidelines !!!!!!!!!

"To bear failure with courage is the best proof of character that anyone can give."

Please post your feedback through comments about your experience on this blog.

Stock picks link :
http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

My other blogs :
http://indianstockmarketsquery.blogspot.com/
http://indianstockmarketsinfo.blogspot.com/
http://calculatemyemi.blogspot.com/

Market Comments - King to decide the next move

What happened yesterday was only a trailer of what could happen in future. When the markets are overheated like what has happened so far, they can collapse in a jiffy was the message to all investors. However markets recovered smartly as FM came and did the required damage control in his own style. Every one wanted the Bull Run to continue and set aside the 'SENSE' in SENSEX. What we are now going to see is only 'X' the unknown quantity rather than the BSE Index called SENSEX.

The whole drama was executed meticulously just to give the FII an indication that the governmean do anything they can if the markets are taken to dizzy heights in an unwanted manner. What happens next? What should we do now? Should we enter the market or wait on sidelines? These are many questions that are cropping up your mind....right????

I would suggest that if you are a new investor and if you want to invest for long term then buy my recommended scrips with 50% of your capacity and then hold the 50% of your capacity in correction mode. You can do this after Reliance declares results today.

Reliance (" King of Indian Stocks ") is going to declare its results today and market expectations are high on the stock split or bonus news. This was the precise reason it closed in positive and also the main reason we could see only 3oo odd points down in the sensex instead of 500 points yesterday.

There are four scenarios possible for Reliance results.

1. Reliance will declare good results and also announce stock split / bonus. Market will be on fire and should touch 20K in next 2 to 3 days. All fundamentals will be kept aside and we should see big rally till 21 K is reached or even 22K. Enter the market, go with the FII and try to make some stocks free of cost or exit with profits.

2. Reliance results are good but no stock split or bonus is announced. We may see some correction in Reliance scrip and market may fall but recovery is possible quickly.

3. Reliance results are poor and no stock split or bonus. Markets could fall sharply and correction can continue for a week or so. One should do stock specific activity and then buy scrips during the fall at every level.

4. Reliance results are poor but stock split or bonus announced. This is very unlikely but Markets will be volatile and markets may move either ways and uptrend may continue.

I expect scenario 2 could happen though my guess could be wrong. Let us wait and see what will happen.

Powergrid corporation is zooming like anything and it is baffling every one. All powerstocks are being rerated but I still believe it is very highly priced now and though it can move to 150 rs in short term seeing the current trend it will then remain flat between 90 and 150 for atleast next few months as it has run up substantially.

IFCI is still a safe bet in this market and hold on to it with patience. If stake sale does not happen also IFCI will get rerated as it is soon going to be a debt free company.

Rathi Bars IPO is going to start today but I advise investors to avoid this issue.

Markets should open up with a gap again and then consolidate before the key event of Reliance results unfolds.

Stock picks link :

http://indianstockmarketscomment.blogspot.com/2007/10/comments-on-current-stock-picks.html

My other blogs :
http://indianstockmarketsquery.blogspot.com/
http://indianstockmarketsinfo.blogspot.com/
http://calculatemyemi.blogspot.com/

What is P-Notes and why did SEBI put restrictions

P-Notes are like our mutual funds where lot of money is collected from various investors in different countries and routed through registered FII in India.

There was lot of money flowing in form of P-Notes and this was taking our markets to unchartered territories. Now if SEBI did not put restrictions, our markets would have even touched 25K by this year end and later if a crash was to happen, it would have damaged the UPA govt reputation. This is why SEBI acted now to control the flows and also it acted as a signal for investors to exit and for new investors not to enter.

What to do now?

DO NOT panic and stay cool. If you have followed my blog from the beginning and have a portfolio with zero cost concept then you would not worry and instead you can now go for bargain hunting with many of your stocks and sell at higher levels again to add some more shares free of cost to your portfolio.

For those who have invested heavily and have not followed the above concept, do not panic but instead wait for opportunity to buy good stocks at lower levels and then stay invested for 2 years to reap benefits.

Please wait for some stability in markets before you buy.

Market Comments - The X Factor

sorry for posting my comments late but I could not access this site for some time and hence late....

As I have been mentioning in my comments that markets are overheated and correction was required. This did not happen and that is why SEBI had to intervene to see that some correction happens. When you take out Sense from Sensex then ony X remains which usually means unknown thing.

The FII in their eagerness to grab a pie in our market have pumped in money like anything and have taken market to dizzy heights. This made the government to worry as if this continues we can see a meltdown when it goes to new heights like 25K. At that point a 10000 point crash will be there and the small investors or those who entered in the last leg will suffer heavily. This will have impact on the government as elections are due in 2009. This is the precise reason govt has asked to SEBI for ways to control this flow.


(Markets will open down 700 plus points and we can see even correction upto 1000 points unless FM Intervenes and sets aside SEBI order. This will be like a warning to FII and even for small investors not to enter markets. Watch out the action today !!!!!!!)

This was my comments that I wanted to post but now Markets have even crashed and hit the lower circuit.

This is after 2004 May crash that we are seeing this Crash. I was cautioning about this thing in my comments since last week.

I hope all my blog readers have benefited from my comments and are safe.

Now please wait for your chance to pick good stocks at low prices !!!!!!!!!!

Maytas Infra IPO allotment Out

Check Maytas Infra allotment by using the below link.

http://203.199.177.158/ipo/

Stock Queries Updated 16th October

I have updated stock queries till 16th October in my blog

http://indianstockmarketsquery.blogspot.com.

Please note that queries posted in that blog only will be answered.

Reliance Update

Reliance industries moved up smartly with speculation of bonus or stock split likely to come in the board meeting on 18th October. There are lot of rumours floating on this scrip and punters are having great time in moving this scrip up on speculations.

Watch out for 18th October when results are going to be announced. Will any other news come out???

IFCI Update

IFCI Ltd has decided to give 30 banks and financial institutions, including
LIC, an option to convert a portion of their debt exposure in the country’s oldest financial institution into equity.

IFCI on Monday reported a net profit of Rs 744.15 crore on a total income of Rs 1,081.17 crore for the six months period ended September 30. The company had recorded a net profit of Rs 100.22 crore on total income of Rs 585.05 crore in the same period last year.

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There are news that bidders may back out of this due to the equity dilution or stake sale delay but as per the MD of IFCI stake sale process will be completed in next two and half months.

Now based on current valuations, IFCI should get even 150 Rs and getting 26% stake at 120 Rs will be very attractive for bidders. Stay invested in IFCI and watch out for more updates.

Market Comments - Another Milestone Achieved

Bulls achieved another milestone in just 4 days. We may see a new record of 1000 points in one day if this pace continues. I had given two probable scenarios of markets correcting at current levels or then markets racing to 19K and above before correcting. I had choosen the first option as the most probable but bulls wanted to prove me wrong. This is democracy and so majority opinion counts and hence I have no problems in relaxing and watching the show.

Dollars are raining and it is pouring like as if there is no tomorrow. All fundamentals are being kept aside and there is just mad rush. We are hearing of a even a pan wala now talking of stock markets and papers reporting about how records are being achieved.

I have seen some investors making 40 times returns in one year in one stock but they do not want to book profits and they say they will do so after 25K is achieved. Are we not ignoring the fundamentals? How long can we do this?

Just 6 months back analysts were saying that our markets are bit expensive at a PE of 15 to 16 and now when we have a PE Of 22, people are ignoring this and instead saying target of 22K as next and 25 K after that. Remember that the same FII who are investing now can pull out their money in a jiffy and markets will literally crash if they do so.

I am not being pessimisstic in my approach but just giving enough caution. I still believe it is not going to be easy to scale 20K mark but if you do not want to miss the show then enter the markets for short term basis and try to play safe. Always keep 75% of your capital ready to enter after the correction.

Play with only 25% of your capital now as the Firangs are in a great mood to invest. You too can enjoy the show but be cautious as we are now playing in the market throwing caution to the wind.

I have updated my targets for the stocks in my previous post. Please keep posting your comments about this blog and I think very soon my blog hits will catch up with the sensex :)