Queries Updated 30th September 2007

I have update my blog http://indianstockmarketsquery.blogspot.com with my answers for all the queries posted ( in form of comments) till 30th Sept 2007. I request all of you to post your queries in my blog http://indianstockmarketsquery.blogspot.com which would make it easy for me to consolidate. Any comments other than queries you can post it here.

GMR Infra Stock Split

GMR Infra Record data is October 8th 2008 but since there is an EX-Date given as 28th Sept, stock split is effective from today. Stock is currently trading at 175 levels which means effective price of 875. All those who were holding shares till 27th September will thus get 5 shares for the 1 share they were holding.

Market Comments - Correction a Must

Markets are going up without any break which is not good for short term as the more higher the markets go, the more severe correction will be. Be careful and try to use the opportunity to make your costs zero cost and wait for the markets to correct. This will happen very soon. If markets defy this logic then we will see very severe correction later.

IFCI corrected as expected due to the delay in short listing bidders. Reliance Natural Resources is one stock which I did not recommend due to its extreme fluctuation but shooted up more than 50% in few days because of its plans to distribute gas in cities. However it will take some time before it moves up again. Those who bought it at lower levels can book partial profits and wait for it to move up. Those who want to enter now may have to wait till it corrects a bit and comes to around 75 levels.

MAYTAS Infra IPO is the ongoing IPO now and I will post my analysis on this by tomorrow. Does the name MAYTAS sound familiar??? Read it in reverse and you will know who the promoters are......

Powergrid IPO allotment status available

Powergrid IPO allotment status is available at http://203.199.177.158/kristel/pgcipo.asp

IPO Analysis and Rating - Saamya Biotech and Circuit Systems

1. Saamya Biotech

Rating : 5 / 10

Issue price : 10 Rs ( At par)

Financials : No financial data is available though company is in the field for the past 5 years.

Advise : Avoid this IPO.

Reasons : 1. Promoters who own Visu International are the ones who are promoting this.

2. Shares offered are very low. Retail get chance to 45 lakh shares which means 4.5 crores of issue for retail. Power grid IPO issue for retail was around 950 crores and still it got subscribed 6 times.

Since saamya is priced at par every one would like to apply and issue can easily get subscribed 100 times also. Low allotment chances and money blocked for one month.

3. Since it is at par issue subscription details cannot be known.

4. Grey market premium is from 5 to 9 Rs but this is due to current euphoria in market and it can change drastically for low priced issues.

5. No financial data available and revenue will be expected only from March 2008 which is not for sure.


2. Circuit Systems :

Rating : 4 / 10

Avoid this.

This IPO also number of shares being offered are low.

PE ratio very less in this field and so price of 35 Rs is very high.

Grey market premium is 4 to 5 Rs which itself gives an idea of the issue being overpriced.

Market Comments - What next?

Markets reached 17K in style and it was the fastest 1000 point sprint aka Twenty20 style. The reason I said Destination 18K after 16K was that 17K would be achieved in style and even I did not expect 17K so fast.

Today is the settlement day for our markets in F & O and so volatility is expected with Bulls having slight edge on account of global factors. Markets may open positive but profit booking and squaring off positions should make markets flat towards end of the day. It is extremely difficult to predict market on settlement day as it depends on the short and long positions and accordingly markets will fluctuate. We will see Destination 18K but it will happen after some correction is due and it will take much more time then 17K. All will depend on quarterly results and the global factors.

Arvind Mills rose smartly yesterday after the speculation call given and I think it should touch 70 easily. There is delay in IFCI shortlisting bidders list due to reasons unknown and this may act as dampener. Any way follow my Zero price concept and be safe in IFCI and enjoy the show. If at all it dips sharply you can add some more stocks as I expect it to be range bound from 80 to 100 till the clarity surfaces.

Markets have run too fast and so it is time for markets to consolidate and then move to next level. I will post my IPO analysis of Saamya, Maytas and circuit systems shortly. Saamya IPO closes tomorrow.

"Follow simple rule of ABC in stock markets. Always Be Careful"

Supreme Infrastructure Allotment Chances

Supreme Infra was subscribed by 52 times but the retail part recieved very good response and was subscribed by 48 times. This is not good news for those who applied as allotment chances are very less.

All the retail applicants will get 60 shares alloted but the chances are as follows.

For those who applied for 900 shares allotment chances are 31%
one out of 3 applicants will get allotment.

For those who applied for 840 shares allotment chances are 29%
one out of four applicants will get alloted.

For those who applied for 780 shares allotment chances are 27%
one out of four applicants will get alloted.

For those who applied for 720 shares allotment chances are 25%
one out of four applicants will get alloted.

For those who applied for 660 shares allotment chances are 23%
One out of 5 applicants will get allotment.

For those who applied for 600 shares allotment chances are 21%
One out of 5 applicants will get allotment.

For those who applied for 540 shares allotment chances are 19%
One out of 5 applicants will get allotment.

For those who applied for 480 shares allotment chances are 17%
One out of 6 applicants will get allotment.

For those who applied for 420 shares allotment chances are 15%
One out of 7 applicants will get allotment.

For those who applied for 360 shares allotment chances are 12%
One out of 8 applicants will get allotment.

For those who applied for 300 shares allotment chances are 10%
One out of 10 applicants will get allotment.

For those who applied for 240 shares allotment chances are 08%
One out of 12 applicants will get allotment.

For those who applied for 180 shares allotment chances are 06%
One out of 16 applicants will get allotment.

For those who applied for 120 shares allotment chances are 04%
One out of 25 applicants will get allotment.

For those who applied for 60 shares allotment chances are 02%
One out of 50 applicants will get allotment.

Good Luck!!!!!!!


I will post my Analysis and Rating on Saamya Biotech, Circuit Systems and Maytas Infra tomorrow.

Market Comments - High Volatility due to settlement

Volatility was high as expected and since F & O settlement is on Thursday and we will see some more volatile swings with negative bias in the next two days. After the expiry, we may see the rally resuming again and progressing towards destination 18K.

I was able to update my blog with the queries posted so far in my other blog
http://indianstockmarketsquery.blogspot.com.

Please keep posting your stock queries and I will try to answer them. Supreme Infra IPO closes today. I expect the retail part to be subscribed by 25 times as it is a small issue.

IFCI crossed 100 and next target is 120. In long run it will give 500 Rs value in 2 years based on its real estate value. Hold on to free stocks in this and then enjoy the returns.

Arvind Mills is another speculative stocks which is rising because of the AGM meeting where some preferential allotment will be done and hence the price expected will be atleast 52 Rs and above and hence the stock should move to 70 Rs. Try your luck in this.

GMR Infra on Fire

GMR Infra moved up smartly today to 880 Rupees. When market was on fire, GMR was bit subdued but I had asked to pick this stock as it will perform later.

GMR Infra should now move up smartly to 1000 which is my target before stock split record date of October 8th.

Nagarjuna Fertilisers also fired up smartly proving that it is time for all speculation stocks that I picked performing except for teledata. It will also perform in coming days.

Jai Corporation crossed 11K and moving towards 15K???

See my link for stock picks...

http://indianstockmarketscomment.blogspot.com/2007/09/comments-on-current-stock-picks.html

Next Course of Action

Markets have run up considerably catching up the action with Indian team in the twenty20 cup. Now that the action is over there, what will happen here?

Try to follow the zero cost price concept and book profits and Re enter the markets once markets stabilize again. I will guide you in this and in case markets rally further which is very unlikely, one can make gains in the stocks that are there with us. Always be safe first.

Market Comments - Settlement Time

I am sorry for writing my comments a bit late today but I was still relishing the glorious moments of yesterday's Twenty20 Final.

Markets will be volatile due to settlement on Thursday and so wait till Friday for further action.

Reliance industries, Reliance Petro and Reliance Capital all had surpassed my targets within one month. I had given targets for one year but we achieved it in close to one month. This is amazing returns as the Bulls seem to follow the twenty20 mode rather the 50 overs. Now that the twenty20 tournament is over, will we switch over to the 50 overs format or will we continue in the new format? I think it is difficult to leave the new format mode once you like it.

Chak De India!!!!!!!!!!!!!!!!!

IPO Analysis and Rating - Supreme Infrastructure Ltd

Supreme Infrastructure Ltd.

My Rating : 8 / 10

Issue opens: Sept 21, 2007
Issue closes: Sept 26, 2007
Issue Price: Rs 95-108 per equity share of Rs 10 each
Market Lot : 60 Shares

Supreme Infrastructure is a Mumbai-based construction company with primary focus on road construction. It is foraying into real estate which should improve its valuations.

Valuations : Supreme Infra profit was 12.5 crores last year with growth rate of 85% and based on expanded equity after the issue, EPS will be 9 and PE ratio will be 12 at top end of price . If you expect a modest 50% growth this year, PE ratio will be 8.

The issue is very well priced as peers in this sector command PE of 20 and hence good returns for investors on listing as well as long term.

Expected Listing Price : 180 to 200.

Target by April 2008 : 275 to 300.

Subscribe to this issue and good chances of allotment as this is the fourth IPO this month after powergrid, kouton and CCC and hence lot of money locked in the above 3.

I expect the retail part to be subscribed 25 times though it is tough to predict because of small size.

Those looking for listing gains can expect 4000 Rs profit assuming 60 shares to be alloted and 180 as listing price.

Good Luck !!!!!!!!!!!!!!

Monday Morning Market Musing - Bulls in Twenty20 mode?

Last week we had huge action in our market and once the FED rate cut was announced markets were up in a jiffy and touched 16K. We are now close to touching 17K and it is like Bulls playing Twenty20 cricket instead of 50 overs match as the current flavour of the season is Twenty20 and with India's scintillating performance in the World Cup everything seems to go well.

We may see some more rally close to 17K and consolidation mode and corrections before we proceed to next destination 18K. If we proceed at this rate we can see even 25K in next 2 years rather 5 years. Brazil's Bovespa was around 30K when I was thinking how far it can go. It even crossed 50K. Considering this and the growth we have even we should aim at 50K if things go well and this can happen in next 5 Years. So 50K by 2012? Twenty20 is the current flavour and bulls seem to like it.

Technology stocks off late have taken a beating but if one invests in quality stocks like Infosys, TCS you will reap rich rewards if you have enough patience. However DO NOT expose too much to this stocks but have your profits invested in this.

I will be answering the stock queries posted in my blog http://indianstockmarketsquery.blogspot.com/ as soon as I can. Please keep posting your queries and I will try to do my best in answering them.

IPO Allotment Chances - Kouton Retail Limited

Kouton Retail IPO allotment Chances.

Kouton Retail Oversubscribed 45 times approx and Retail part subscribed around 16 times.

Based on this allotment chances for various categories for Retail Investors will be.

Those who applied for 240 shares will get firm allotment of 15 Shares.

Those who applied below 240 will get 15 shares alloted but allotment chances will be as follows.

Those who applied for 225 Shares allotment chances will be 94% .

Those who applied for 210 Shares allotment chances will be 87% .

Those who applied for 195 Shares allotment chances will be 81% .

Those who applied for 180 Shares allotment chances will be 75% .

Those who applied for 165 Shares allotment chances will be 70% .

Those who applied for 150 Shares allotment chances will be 63%.

Those who applied for 135 Shares allotment chances will be 57%.

Those who applied for 120 Shares allotment chances will be 50% .

Those who applied for 105 Shares allotment chances will be 43%.

Those who applied for 90 Shares allotment chances will be 37% .

Those who applied for 75 Shares allotment chances will be 31% .

Those who applied for 60 Shares allotment chances will be 25% .

Those who applied for 45 Shares allotment chances will be 19% .

Those who applied for 30 Shares allotment chances will be 12% .

Those who applied for 15 Shares allotment chances will be 6% .

This is based on assumption of 16 times subscription and actual allotment can vary slightly depending on exact subscripition and valid bids.

Good Luck !!!!!!

****************
I have created new blogs which will be useful for beginners in stocks or for those who would like to know answers on how to invest and also posting queries on stocks or other financial related information.

http://Indianstockmarketsinfo.blogspot.com

http://IndianStockMarketsQuery.blogspot.com

http://CalculateMyEMI.blogspot.com

I hope these blogs will be useful to you. Please post your feedback on improving these blogs.

IPO Allotment Chances - Consolidated Construction Consortium Limited

CCC oversubscribed by 80 times but the retail part will get subscribed approx 13 times.

Based on assumption of 13 times subscription for retail part,this IPO Allotment Chances for Consolidated Construction Consortium Limited will be as follows.

For those who applied for 192 Shares Firm allotment of 14 shares approx.

For those who applied for 180 Shares Firm allotment of 13 shares approx.

For those who applied for 168 Shares Firm allotment of 13 shares approx.

For those who applied for 156 Shares Firm llotment of 12 Shares.

For those who applied for 144 Shares Allotment chances 92% .

For those who applied for 132 Shares Allotment chances 85%.

For those who applied for 120 Shares Allotment chances 76%.

For those who applied for 108 Shares Allotment Chances 69%.

For those who applied for 96 Allotment Chances 61%.

For those who applied for 84 Shares Allotment Chances 53%..

For those who applied for 72 Shares Allotment Chances 46%.

For those who applied for 60 Shares Allotment Chances 38%..

For those who applied for 48 Shares Allotment Chances 30%.

For those who applied for 36 Shares Allotment Chances 23%.

For those who applied for 24 Shares Allotment Chances 15%.

For those who applied for 12 Shares Allotment chances is 7.5% .

The actual allotment cary vary a bit depending on exact subscription.

Good Luck !!!!!!!!!!

Market Comments - Consolidation Time

Bulls will be in control of markets though we may see some odd corrections. Rate cut has gone well with Banking stocks and real estate stocks. DLF which was one of my picks has moved from 550 to 750 levels in less than one month. These kinds of returns are amazing and one should know where to invest. DLF target is 1200 in next 6 to 9 months.

Banking stocks will also perform well and SBI target is 2500 in next 9 months and eventually 5000 when value unlocking from its subsidiaries happens. IDBI wil have value unlocking after IFCI stake sale and 50% returns from IDBI from here also is possible. There is talk of IFCI valuation being around 500 due to its Real estate value. This may not happen immediately but try to keep some zero cost shares for long term and enjoy the returns.

Jai Corporartion ki jai ho!!!!! It was locked close to 10K yesterday and it will cross 10K today. Sometimes the returns in this type of stocks are amazing. From 400 a year ago to 10000 is amazing returns which is similar to the run in Unitech from 400 to 350000 ( after 1:12 bonus and stock split to 2 Rs.) in 2 years. These kind of stocks are not common and one needs to identify this type of stocks early to make returns. I will try to give them whenever possible.

"It was an amazing day yesterday as India are through to Semi Finals. Let us hope for an India Pakistan Final which will be a great finish to the new format"

IPO update -CCC and Kouton Retail

Consolidated Construction Company limited IPO looks expensive and hence I have given less rating but based on data from NSE for FII part, one can apply for this for listing gains. FII response was good so far and it should be oversubscribed around 30 times for FII portion which will give decent listing price.

Kouton Retail is likely to be oversubscribed heavily in retail part on last day as the issue size is less. Good listing expected but allotment chances may be less.

Good Luck !!!!!!

Market Comments - Dream Run for Bulls

Markets reached 16K in grand style and also finished around 16300 levels. There were lot of shorts built for the FED event and the bears had no other option but to go for covering the shorts as the opening itself was 300 plus and so we had 600 points plus closing which was a record sort. What next now?

Short covering will continue for some more time and we may see some profit booking coming along. Keep focus on quality stocks and also a vision for next 5 years.

1. Infrastructure and power are going to be the best sectors where you can have quality stocks. GMR Infra, Lanco Infra, GVK, L &T, BHEL, NTPC, PTC, powergrid etc are good stocks you can focus on.

2. Visit my post for my stock picks.
http://indianstockmarketscomment.blogspot.com/2007/09/comments-on-current-stock-picks.html

3. Reliance group companies are any way going to perform well and Reliance will move with sensex. Reliance Ind, Reliance Petro, Reliance Capital, Reliance Communication are going to perform well.

4. IT stocks may not perform well but invest in only quality stocks like Infosys and TCS which have ability to perform even in pressure.

5. Apply for quality IPO's and stay invested in good quality stocks.

Above all try to make your portfolio zero cost whenever opportunity arises as corrections are imminent and even a 1000 point fall in a day cannot be ruled out as the sensex starts rising.

When sensex was around 5000, a 5% correction meant 250 points but now it will be 800 points which should not worry as corrections are going to be part of the bull run where weak hands exit and strong ones enter.

Jai Corporation is going to reach 10K today. I hope some of you have benefitted in this stock. Please keep posting your feedback as it will enable me to bring more quality stuff for all of you.

"Yesterday was a great day for us. Bulls made a record gain and so also Yuvaraj's sterling performance with his 6 sixes in one over."

Destination 16K Reached

As I had mentioned in my comments yesterday that if FED rate cut happens, markets could touch 16K in a jiffy and so it happened in style without any hurdle. Markets are currently trading around 16090 and a finish above 16K should happen today without any problems.

Next Target???? Destination 18K ......Keep Visiting this blog for more information.......

Market Comments - Markets will be on Fire

Fed has taken a bold decision to cut interest rate by 0.5% which Augurs well for market and we should now be a kissing distance away from 16K. All Asian Markets are on fire and so will our markets.

Markets should open with 200 plus points and then rally smartly. We should see 16K very soon. All my recommended stocks will be on fire. Jai Corporation is close to 10K and it should reach there in next two days. Reliance Capital from 1000 to close to 1500 giving 50% returns.

Fortune favours the brave and so those who bought stocks when markets were down will enjoy the rally. What should one do now? If you have already bought some stocks then please wait and hold on to your stocks. No need for any fresh addition unless you have very less stocks. One can still buy stocks like GMR Infra which did not rally much but it should do so very soon.

Those who are new to market can start buying in small quantities and then if markets dip can add more. Remember that market corrections are part of the Bull rally and this keeps happening. I firmly believe that we can reach 25K much before 2012 as India growth story is intact.

Lot of action to happen in our markets for the next 5 years. Keep visiting this blog for daily action.

"Munaf is a mystery, Not History..." Dilip Vengsarkar on Munaf's selection.

IPO Analysis and Rating - CCC and Kouton Retail

1.Consolidated Construction Company limited
Issue opens: Sept 18, 2007
Issue closes: Sept 21, 2007
Issue Price: Rs 460-510 per equity share of Rs 10 each
Minimum Application : 10 shares and in multiple of 10 shares.

My Rating : 5 / 10

Financials : EPS is 30 for FY07 PE will be around 17.

There are many other stocks available in Construction Sector at less price. However due to good secondary market conditions issue may get good listing price. Current Grey Market premium is around 100 Rs. This will be purely for listing gains for risk takers.

My Advice : Avoid this IPO.

2. Kouton Retail India Ltd.:

Koutons Retail India Ltd.
Issue opens: Sept 18, 2007
Issue closes: Sept 21, 2007
Issue Price: Rs 370-415 per equity share of Rs 10 each
Minimum application: 15 equity shares, and in multiples of 15 equity shares thereof

My Rating : 6 /10

Financials : EPS is around 17 which gives PE of 24 on upper band price. Lot of craze in market for retail stocks. So one can apply for listing gains.
Current Grey Market Premium : Around 80 to 100 Rs.

Advice : One can apply for listing gains only.

Market Comments - Advantage India

There is lot of speculation in US Markets on what Fed will do. They are three possibilities that FED can do. Cut the interest rates by 0.25% or by 0.5% or there is no rate cut. The economic data warrants for a rate cut but rising oil and gold are going to cause inflationary pressures.

It is not going to be an easy decision and if FED does not cut the rates we may see some downside in our markets but it is going to be short term trend and in long run it is going to be advantage for India due to the growth story we have here.

Lot of Funds will flow and so our markets are going to move towards the dream run of 25K by 2012. I am going to post IPO Analysis and Strategies of CCC and Kouton Retail today.

Markets can be weak today a ahead of FED decision and based on this further movement is expected.

"Nothing is Impossible as Impossible itself says I-M-POSSIBLE"

Monday Morning Market Musing - FED Event is the next trigger

This is going to be another interesting week when we will see Bulls attempting to reach Destination 16K and Bears attempting to pull the Sensex down.

Market will reach 16K in its own style but the focus should be on specific stocks and make money out of them. Investment is an art, It is not by fluke that you make money.

Those who are new into stock investments should focus on stocks which have great growth story for future. Those who have made good profits can go for speculation stocks as they have enough buffer for covering in case of loss. Jai corporation was one stock which was punters favorite and I had recommended this around 6K for a target of 10K. It is blazing all guns and moving slowly and steadily. This stock is bit speculative and depending on market conditions the swing can be either ways.

IFCI will finalise the bidders on 25th September after which we will see the dates being finalised for the bidding process and the whole thing will get settled by Feb 2008. However Those who have invested in IFCI at 60 levels can expect a return of 50% to 100% depending on the bidders. I feel 120 Rs is the right price for IFCI and every one would like to have stake in this.

The downside will be limited and it can happen only if the stake sale is halted abruptly or if the stake sale does not happen to one bidder etc and these events have remote chance of happening. Stay Invested in IFCI.

Markets should open strong and there should be some volatility again today. The US Fed is going to meet on Tuesday and some nervousness is there in US Markets. The Fed is expected to cut interest rates by atleast by 25 basis points or 0.25% and some say it can be o.5%. In my opinion it will be 0.25% as FED would like to go slow as Inflation still remains a worry. If the cut happens, US markets will rally smartly and we will see Destination 16K in a jiffy.

IFCI Update

There were 1o bidders for 26% stake in IFCI. They were
1.IDFC
2. Kotak Mahindra Bank
3. GE Capital,
4.Cargill,
5.French banking company Nataxis
6.US-based private equity fund manager Blackstone
7.US-based private equity fund manager Newbridge
8. W L Ross, Standard Chartered Bank, Goldman Sachs and HDFC,
9.Punjab National Bank with Shinsei Bank of Japan and US-based investor JC Flowers
10.Mgan Stanley in consortium with Sterlite Industries

The company will evaluate the EoIs and announce the shortlisted investors on September 25.Thereafter, the shortlisted entities would be asked to undertake due diligence and submit bids indicating the price they would be willing to pay for the 26% stake.

Based on the technical and financial bids, the board would finalise the name of strategic partners. Request For Proposal (RFP) would be floated by October 1.

The pre-qualified investors will need to submit sealed financial bids by November end.Ernst & Young (E&Y) had been appointed by IFCI as consultant to find a strategic partner for reviving the financial institution.

IFCI Update

There were reportedly Ten Bidders in fray for IFCI. The exact bidders will be known by Saturday Evening. The expected bid price could be even 120 Rs due to the competition. This is going to be good news for IFCI investors.

The only possibility of downside could be when there will not be one investor who is not given the 26% stake. This will not trigger open offer and so price movement will not be there. There are some othe minor issues to be resolved but all this will have limited downside for IFCI.

Stay invested and I will most more updates on IFCI once the news trickle in.

Weekend Market Comments - No Reason for Panic

Markets were close to destination 16K when profit booking started. This is natural in markets as every one would like to be on safe side. I had also advised you to follow the Zero price concept for stocks where your portfolio will have stocks which you get at zero price.

This is simple. Buy 100 shares of a stock at 100 Rs and sell 80 shares if it reaches 125. This way you get back your money and the remaining 20 shares are free of cost. You can again buy back the stock if it comes to 100 Rs and then sell at rise. This is one way of making your portfolio free of cost.

When there was a fall yesterday from highs, every one has started saying that we are going to have correction now. This is akin to the scenario where we have Stars shining brightly and due to clouds if we cannot see them for a while and some one saying the Stars have disappeared for ever. Please keep posting your comments and also suggestions in making this blog provide useful information for all.

Markets will slow and steadily move to 16K in their own style and there is No Reason for Panic.

"We had a Fantastic Match Yesterday and India Kept its record of NOT losing to Pakistan in a World Cup Match"

Power Grid IPO Update

Power Grid IPO has been subscribed 65 times. FII part is subscribed 115 times. NOn Institutional Investors part 40 times and retail part 6.76. I had expected this to be 7.5. This means those who applied for 875 shares will get firm allotment and those in other categories ie less than 875, chances will improve.

FII subscription being 115 times should give a good premium for powergrid listing as lot of appetite will be there to get in secondary market because if an FII had applied for 100 thousand shares, they would not even get 1000 shares. This will drive up the price on listing. I will not be surprised if powergrid lists around 82.

Market Comments - Close to the Destination

Markets are now poised close to 16K and we should see this very soon. Lots of shorts are there and unless we have some very bad news coming from global markets we should be moving towards 16K. Reliance Industries, Reliance Petro, Reliance Capital all have given good gains. These were few of my picks which are given in seperate posting for which link is shown below.

http://indianstockmarketscomment.blogspot.com/2007/09/comments-on-current-stock-picks.html

Powergrid IPO closed yesterday and those who get allotment can expect 20 to 25 Rs profit per share and if you hold this for 6 months, it can reach a target of 100 and also it has excellent future considering it is in power sector.

Rupee appreciation is a major concern for Tech stocks and they will continue to languish but those who have patience and can hold on to top IT companies like Infosys, TCS will reap rich rewards.

GMR Infra is still languishing around 780 range but it should make a big move in coming days as the time is ticking for the stock split. Remember that if you have patience to hold for 3 to 4 years you will reap rich rewards in this. Long term returns are always fabulous and those who had invested 10,000 in Cipla in 1979 had around 400 crores by 2005. That is the power of long term investment.

"India Play Pakistan in twenty-20 today and I hope rain does not spoil the game"

Power Grid IPO Allotment Update

Power Grid IPO has been subscribed 65 times till 8:00 PM which is very good considering the issue size. However the good news for retailers is that the retail part has been subscribed around 6 times at the cut off price till 8:00 PM and considering price bids which are valid the retail part should be subscribed 7.5 times. This is very good because the allotment will be more and since overall subscription is more, FII need to buy in secondary market which means good listing price and so good gains for retail investors. :)

The approx allotment could be as follows.

For those who applied for 1875 Shares. Firm Allotment of around 250 shares.

For those who applied for 1750 Shares. Firm allotment of around 233 shares.

For those who applied for 1625 Shares. Firm allotment of around 216 shares.

For those who applied for 1500 shares. Firm allotment of around 200 shares.

For those who applied for 1375 shares. Firm allotment of around 183 shares.

For those who applied for 1250 shares. Firm allotment of around 166 Shares.

For those who applied for 1125 shares. Firm allotment of around 150 Shares.

For those who applied for 1000 shares. Firm allotment of around 133 shares.

For those who applied for 875 Shares. Chances of allotment are 92% which is close to firm allotment. Shares alloted will be 125.

For those who applied for 750 Shares.Allotment Chances are 80% ie 4 out 5 applicants will get allotmentment of 125 shares.

For those who applied for 625 shares Chances are 66.66% ie 2 out of 3 applicants will get allotment of 125 shares.

For those who applied for 500 Shares. Allotment chances are 50% approx. Shares alloted will be 125.

For those who applied for 375 Shares. Allotment chances are 37.5% approx. Shares alloted will be 125.

For those who applied for 250 Shares. Allotment Chances will be 25%. ( 1 in every 4 applicant s will get allotment) Shares alloted will be 125.

For those who applied for 125 Shares. Allotment Chances will be 12.5% or 1 in every 8 applicants will get allotment. Shares Alloted will be 125.

Note that in all cases till 750 shares, allotment is the minimum market lot of 125 shares but the more shares one applies the more chances of getting allotment.

These are approx numbers I have given on assumption of 7.5 times subscription for retail part. The actual numbers could vary slightly depending on the exact subscription.

Good Luck to all those who applied for this IPO.!!!!!!!

Market Comments- Consolidation Time

Markets will be in consolidation mode and also Volatile for couple of more days. Bulls will take charge once we see some global stability. However as I have been mentioning in this column frequently focus on specific stocks to reap rich rewards. Reliance Capital moved up smartly and from my recommended levles one could have gained 25% plus in this.

Focus on specific stocks and forget the sensex for now. Power Grid IPO closes today and I expect it to be oversubscribed by around 25 times though it is difficult to guess the figure. Retail part was subscribed 1 time till yesterday evening but I believe it should get good subscription and it should be around 20 times though this can change drastically.

"Destination 16k is intact"

Market Comments - Bulls in Control

Markets opened strong yesterday but could not sustain as some profit booking was evident. Strong global cues will have the opening impact of 100 to 150 points and then the drama will start again today.

IFCI was star performer and in another couple of days we can know who are the contenders for the stake sale. This will make the price move up but I believe IFCI share holders should get something close to 100 and if the competition is intense, share holders will benefit.

Global markets are volatile and so are our markets but if you focus on specific stocks forgetting the sensex for now, you will reap rich benefits. Reliance Petro moved smartly from my recommended levels and so also my other picks. GMR Infra was at 680 levels when markets corrected and is now at 800 levles but I expect it to move to 1000 by October 8th.

Power Grid Corporation IPO closes tomorrow and we should have some idea of oversubscription by tomorrow morning. At present the retail part subscribed by 0.4 times but most of the bids from retail will come in on the last day. However the issue size is big and so those who apply in the high end of 1875 shares will have a good chance of getting allotment.

" If you have patience that itself is a form of Wealth"

Market Comments - Resilient Bulls

I had expected that markets would tank 400 points based on US cues but Bulls were Resilient to fight back. This was evident after we had an opening of only 100 points downwards which should have been 300. This is good for our markets as it shows that our markets are becoming Resilient to US markets and moving towards destination 16K.

This is going to create an interesting battle for Bulls and Bears. To predict the market in short term is extremely difficult. Today market will be volatile and we may see some downward bias. If Bulls manage to move sensex up by another 100 points then lot of short covering should take place. However lot will depend on US cues in the next few days and if US Markets tank further then it will be difficult for our markets to escape.

IFCI has moved up smartly by more than 20% from my recommended level of 60 and as per sources the bid is going to be easily more than 100 as the competition is getting hotter.

Share holders will benefit if the stake is bought by single entity as according to SEBI rules if some one buys more than 20% stake of company then there should be an open offer to buy shares from other investors. This will naturally boost IFCI price. I believe Reliance Capital is keen in buying IFCI stake and so it can even go for 100 Rs plus to acquire 26% stake.

GMR Infra record date is October 8th and the rush to buy before split will start soon. In fact stock split will act as cushion for GMR Infra even if there is a big fall.

PTC, NTPC will get re rated because of power grid corporation IPO and so they will make smart gains when power grid is going to be listed.

Current IPO Ratings

1. Kaveri Seeds :

My Rating : 5 / 10

Price Band : 150 -170

Avoid this IPO as it is very aggressively priced at a PE Of 22 at upper band. Current grey market permium is around 25 Rs.

2. Dhanus Technologies Ltd :
My Rating : 6 /10
Price band : 280-295
comment : Not Attractive but apply for listing gains only as current grey market premium is around 100 Rs.

3. Power Grid Corporation of India Ltd.

My Rating : 7/10

Price Band : 42 to 50.

Issue starts on Sep 10th and closes on Sep 13th.

Valuation : offer price at PE of 14 on upper band price at EPS of 3.7 for FY07.
Expected Listing Price : 70 to 80 Rs. ( This is based on curent grey market premium)

Apply for Listing gains and also for Long term point of view as power sector is going to have good growth.

Strategy to Apply : Apply for 2000 shares at cut off price and if the issue is oversubscribed by 15 times also then you will get firm alotment of 125 shares which is the market lot.

The issue size is big and hence good chances of getting allotment.

Good Luck!!!!!!!!

Monday Morning Market Musing - Another Volatile Week

It has been a cat and mouse game for the markets. US Markets tanked on Friday very badly and remember that we had escaped on last wednesday when US markets corrected. Our markets cannot ignore global cues for long. It will be akin to expecting Uthappa to win matches for India every time.

However be on the positive side and pick up stocks again at lower levels as markets are going to be good in long term and destination 16k is still intact. Buy good growth story stocks and they will never fail you if you have enough patience. Remember that patience is the key in Stock Markets to reap rich benefits. All the intraday gains and other quick money means are zero games which means one bad day can wipe out your one month gains.

This is not true with long term investments where you reap good benefits because of the growth in the stocks in you pick. If some one had bought Reliane before demerger at 700 levels it is worth 2400 today which gives the kind of returns one can have in long term and also the cushion one has.

Use the dips to make your stocks free of cost as suggested in my previous posts and thus enjoy a good portfolio with little risk.

Markets open around 250 to 300 points lower and later consolidate and close around 400 to 500 points unless there is some sudden news which is in favour of bulls.

LIC may join race to buy 26% in IFCI

Insurance major Life Insurance Corporation of India (LIC) is evaluating the option of bidding for IFCI. The Delhi-based term-lending institution has invited bids for a 26% stake in the company. The bids are slated to close on September 14, 2007. Speaking to, LIC managing director DK Mehrotra said, “We have not yet submitted a bid. But we are considering it.” Mr Malhotra declined to give further details. Meanwhile, sources said the stake buy would provide LIC an opportunity to build its asset base.

According to sources, the country’s largest insurance company has been approached by a number of private equity firms and hedge funds to bid for the IFCI stake as a consortium. However, senior officials from LIC said that they would prefer to bid alone. IFCI has said that a consortium of four members can apply for 26% stake, but each consortium should nominate a lead member.

Private equity funds and hedge funds are keen on LIC or IDBI as their lead member. Among Indian entities, Punjab National Bank (PNB) has shown interest in acquiring 26% in IFCI. Similarly, several foreign banks and private equity firms have approached IDBI to bid as a consortium for IFCI. “We are not very keen to bid as this juncture,” said a senior official from IDBI. Even as many foreign entities have shown interest in IFCI, sources said the Central government is very keen that the controlling stake continues with Indian financial firms. “Further, the management of IFCI, too, is keen on inducting an investor who is serious, and would enable IFCI to emerge as a stronger institution,” said a senior IFCI official.

The FI, too, has indicated the applicant itself should be in the business of financial services. These are some of the main reasons for private equity firms and hedge funds looking at bidding as consortium with Indian players like IDBI and LIC. IFCI has also stipulated that there would be a lock-in period of, at least, three years for the investor who acquires 26% stake in it. According to the criteria set by IFCI, the applicant’s asset book should not be less than Rs 10,000 crore or it should have a net worth of Rs 4,000 crore as of March 2006.

Market Comments - Chak De India

Markets opened weak yesterday based on global cues but then Bulls had different ideas. Our markets have now become resilient enough to move ahead even though US cues were not good. Markets recovered very fast and now progressing towards destination 16K.

SBI, IDBI, DLF, GMR Infra, Infosys, Reliance, Reliance Petro, Reliance Capital all will move smartly. Bears will have no choice but to cut their positions as they had lost a good opportunity yesterday. When Sensex was at 6K very few had thought that 10K would be achieved. Now even 20K looks possible and if everything goes well we can see grand 25K in another 5 years as predicted by RJ.

Chak De India!!!!!!!!!!!!!!

Market Comments - Weak Global Cues

US markets fell yesterday due to poor housing data and markets were worried about economic recession. It has been a yo yo ride for the US Markets with some data or the other pouring in and markets reacting accordingly.

Our markets will also open weak reacting to the cues and also we may see some correction as market has already moved up 2000 points very fast. We could have seen 16K quickly but for the cues from US which gives bears upper hand for the moment.

This also gives another opportunity for those who missed to buy stocks in earlier fall. My target of 16K is intact and it takes a few days for markets to move up in a jiffy again. The trend in the past month or so reminds me of a puzzle which asks the time for the monkey to climb a pit of 50 ft where a monkey can climb 3 ft in an hour but skids down 2 ft again in the next hour. Our markets also in the same situation but you will see 16K very soon.

Comments on Current Stock Picks

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

1.BAJAJ AUTO LTD
Demerger will create value for stock holders. My target is 4000 in 1 to 1.5 years.

2. BHEL

Good order book position. Can expect an appreciation of 50% in one year.

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.

4.ICICI BANK LTD.
One more good banking stock to pick in private sector. One can gain around 30% in one year time.

5. INFOSYS TECHNOLOGIES LTD

Technology 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.

6. Reliance Communications LimitedGood stock to hold in portfolio. Expect a return of 40% in one year from current levels.

7. RELIANCE INDUSTRIES LTD

Target of 2500 in one year. It will move with Sensex and retail story can fuel this upto 4000 in 2 years.

8. Reliance Petroleum Limited

Target of 180 in One year. Good prospects for this stock.10. Sun TV Network LimitedTarget of 450 in one year time. Has good potential in terms of revenues.

9.PTC INDIA LIMITED

Target of 125 in one year.

10. 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.

11. IDBI

Good banking stock with value unlocking to take place. Target of 175 in 6 Months time.

12.STATE BANK OF INDIA

Value Unlocking and lot of potential left in this. Target of 2500 in one year time.

13.RELIANCE CAPITAL LTD

Another 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.

Speculative Stocks or Punters Favourites
1.IFCI LTD

Target of 100 depending on the bidders.

2.JAI CORP LIMITED

Target of 10000 being flouted on basis of stock split to 1 Rs.

3.NAGARJUNA FERTILIZERS LTD

Stake sale rumour making this stock move up fast. Target of 60 being predicted.

4.TELEDATA INFORMATICS LTD

Stock keeps moving from 55 to 70. Keep track and buy. Target of 125 in one year if demerger takes place.

Market Comments - Destination 16K?

As I had some problems with connectivity I could not post my comments yesterday.

US Markets closed in positive and our markets should open strong and then consolidate. From lows of 13700 we are close to 2000 points up and that too in a few days time. Remember that I had mentioned in my comments that market can fly in a jiffy if things stabilised a bit and this happened.

GMR Infra, IFCI, IDBI, SBI, DLF, Reliance, Reliance Petro, PTC all my recommended stocks moved up smartly and one could have made around 20% in these stocks on average. That is why luck favours the brave.

Markets should touch 16K as bears will try to cut shorts. We may miss 16K only if we have some bad news coming from US again as markets have already moved up. If US Markets are marginally stable also we should see 16K. Where will market go up from 16K then? We should see next target of 18K as our markets are still in bull grip and political uncertainity is not there.

All these things can change dramatically but that is the reason liquidity exists in stock markets and also that is the beauty of stock markets.

The famous Gabbar character of Sholay would now say " Are O Samba....Sensex Kitna Hai Rey?"

GMR Infra Update

GMR Infra share holders approved the stock split at the meeting held on 31st August. The company has fixed October 8th as the record date for Stock Split from 10 Rs to 2 Rs.

I expect GMR Infra to touch 1000 Rs by October 8th and the stock should list around 200 Rs ex-split.