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.