Comments on Current Stock Picks

Here is the updated 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. 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.


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 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.

I still maintain my target.

6. Reliance Communications Limited

Good 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 LTD

Target 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.


8. Reliance Petroleum Limited

Revised target for RPL is 250 in one year.

9.PTC INDIA LIMITED

Target of 125 in one year.

It should now be 150 in one year

10. Sun TV Network Limited

Target 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.


12. IDBI

Good 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 INDIA

Value 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.


14.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.

It has moved up from 1000 levels to 1800. Revised target is 2500 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.

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.

3.NAGARJUNA FERTILIZERS LTD

Stake 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 LTD

Stock keeps moving from 55 to 70.

Keep track and buy. Target of 125 in one year if demerger takes place

Target should be reached now as high court approval achieved.

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.

Teledata on Fire

Teledata info moved up on Friday and it is up today also by around 12% as it got the required approval from court for demerger.

Teledata was one of my picks in speculative stocks.

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

It should now go to the first immediate target of 90 and then 125 in next 15 to 30 days. However remember that punters play in this stock.

Monday Morning Market Musing - Wait for Opportunity

Markets tanked on Friday led by Reliance as there was no news of stock split or bonus as was expected. There was lot of speculation that stock split could be announced in the AGM but when this did not come, profit booking started and punters started exiting.

The only good thing to cheer about is on the political stability front. We are now certain that there will not be any mid term elections and cong is even ready to dump the nuclear deal to appease the left parties. For the moment this issue is resolved.

Markets should open positively today based on the politcal cues adn global cues but I believe that at every rise there will be profit booking and hence we will see correction. If this does not happen and if markets move up again to 19k then we may see a huge meltdown before we touch 20K. The correction at that time will be sharp. I however believe we will have some correction this week as probability is more and not many triggers left for Bulls to lead the charge.

IFCI will remain in lime light till the bidding process is complete and I believe those who stay invested in this counter should get 120 to 130 Rs in next 4 months if every thing goes well. Those who are holding zero cost shares in this counter will not have anything to worry.

Powergrid corp is having high PE at present but I believe this is due to the future growth and power sector re rating. However please wait for this stock to dip before you make fresh purchase. It should come down.

To make a comparision, Infosys used to quote at a PE of 35 just around 9 months back. It is now quoting at less than 25 PE on its FY08 expected EPS of 80. Powergrid corp is now at a PE of close to 30 which shows how the power sector has been in lime light for the past few months.

I believe one can accumulate IT stocks by investing small amounts of profits . Infosys is the best bet for this purpose. It has the ability to withstand rupee appreciation and considering the growth plans it should give decent returns from here as the fall in IT stocks has been overdone.

If the dollar quotes at 41 levels again and PE for Infosys goes to 25 also, you will get 25% min on just the PE value. Added to this if IT sops continue even beyond FY09 though chances are less in my view, it will add fuel to fire to IT stocks. Stay invested in Infosys and try to put some of your profits in Infosys so as to reap rich rewards and risk will be less.

Weekend Market Comments - Bears in Control

I will be posting my weekend market comments on every saturday for weekend surfers.... :)

Markets Corrected yesterday as I had mentioned that we were in high risk zone and correction was badly needed. Markets have run up so fast that even our FM was concerned about the rise.

Whenever anything rises abnormally then there will be correction and then pause. Fewe months back GMR Infra moved from 750 to 1000 in 2 days time and since then it is struggling around 800 levels. GMR Infra is a good stock but it has run up way ahead and hence it is consolidating now. Those who bought it at 1000 levels will have to wait for some time before it moves up.

Similarly Sensex has moved up way ahead and it is time for correction and then consolidation. The earlier it corrects the better or else it would be a vertical crash if it moves up higher and higher without correcting.

There seems to be good news on the political front with govt not trying to poke left parties and hence mid term elections are ruled out for now. However every rise in market now will be met with profit booking and hence we will see correction next week. Remember that market had risen even when there was bad news and hence the reverse should happen now. It will correct even on good news and if there is even sligh amount of bad cues, we will see more drop in the sensex.

IFCI is one stock which is going to test your patience and those who bought it at 100 levels will have to wait for 4 months atleast before clarity surfaces. Those who have bought it at lower levels and have booked profits and kept zero cost stock can try to add more at lower levels and sell at higher levels.

Focus on Powergrid corporation and try to buy it in the correction mode. It is surely a good stock for decent returns in next 1 year.

Market Comments - High Risk Zone

Markets are moving at a fast pace and even Infy results have been ignored as expected in my yesterdays comments. However this cannot continue for long and if it happens the retail investors will get caught on the wrong side.

We should have had good corrections but due to huge FII inflows this did not happen. However market cannot go like this and so I have been cautioning you to be careful and only enter for a quick exit. DO NOT worry that you have missed the last leg of the rally. If you had zero cost portfolio you would have enjoyed the rally. Once 19K is crossed it is time for you to even sell your zero cost shares and wait for correction. Even your zero cost shares, you can make some money when market corrects as it is overdue. Start selling at every rise in terms 0f 10% at every 100 points or so. Correction is a must and it will happen. If this does not stop here then there will be a huge meltdown. Be cautious and limit your exposure.

Sensex EPS for FY08 is expected to be 850 and for FY09 around 950 to 1000. So our sensex is at a PE of 22 for FY08 and even for FY09 also we have a PE of 19 to 20. Two years back we had a meltdown because the PE of 16 was also considered high. You can just imagine at what risk level we are. If sensex was to correct to PE of even 17 which is higher markets can correct 4000 points !!!!!!!!

Powergrid corporation target is 200 in one year but accumulate at lower levels. It will come down very soon as it has run up considerably. 80 to 90 price is possible in this depending on market correction. One stock which is moving non stop is Jai Corporation. It is because of the SEZ profits that Jai Corp is going to get as the owner of Jai Corp Anand Jain is close to Mukesh Ambani. It will cross 20K ( before split price) today.


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

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

Stock Queries Updated 11th October 2007

Stock Queries posted in the blog http://indianstockmarketsquery.blogspot.com have been updated. Keep posting your queries there.

Supreme Infra Allotment Status Out

Check Supreme Infra Allotment status by clicking the link here. You need to give your application number.

http://www.bigshareonline.com/IPO/ipostatus.aspx

Market Comments - Infy Results Disappointing

Infosys results were just on target with net profit of 1100 crores. The guidance in terms of rupee for FY08 will disappoint market as it is now at 79.88 at the upper end which means the guidance is lowered a bit. Q2 is good quarter for all tech companies and so this will not be good for IT companies as the IT index is going to be down for sure.

Why are markets rising so sharply? See the below news from times of india.....

It's raining dollars. For the week ended September 28, India's forex reserves increased by almost $12 billion. This is more than the $10 billion that came into the country between April 2005 and March 2006.

This was the precise reason market rose sharply creating records. FII believe that rupee will appreciate further and this will help them make more profits.

Consider the scenario when dollar was 46. If an FII invested 100 dollars in market investment would be 4600 rs at that time. Now assume the stock price is same then the investment amount in Rupees will be same as 4600 rs only. In terms of dollar it is however 115 dollars based on current dollar rupee exchange of 40 which means 15% appreciation. This is why FII are loving India. Add to this the stock appreciation you can understand why they want to invest in India.

How will markets react today? There will be initial knee jerk reaction and we should see IT stocks going down and even market may go down initially. However considering strong FII inflow I believe other stocks should pull up. However wait till RIL AGM tomorrow and if RIL stock split is announced then markets will be on fire again ignoring infy results.

More clarity will surface after RIL AGM. Will RIL deliver this time? let us see....

Infosys Results - What can we expect from this?

Tomorrow Infosys is going to come out with Results and lot of expectations are there.

Market expectations are that Infosys sales will be up around 8 to 10% and profit around 2%. The key is the guidance revision. FY08 Guidance for EPS was around 80. If Infy can up this to 83 or 84 then market will be pretty pleased with this and Infy can jump another 100 to 200 Rs on account of this.

If the results are not good and guidance is around 81, stock may react sharply as it has run up considerably. Markets will also depend on Infosys results and usually Infy delivers good numbers in Q2 which is a strong quarter.

Watch out for Infy results.

Market Comments - Never Say Never Again

Bulls were on rampage yesterday after the initial lull and though I expected the rally to start after couple of days, it started in a jiffy. If you read my comments yesterday where I had mentioned...."Wait for the signals to enter fully. However buy in small quantity the above stocks so that you do not miss the bus when rally starts again."

Bears did not expect the reversal to happen so quickly after the fall on Monday and the reversal was so sharp that the shorts had to be covered and most of the short sellers were badly trapped. This is the precise reason I never advise short selling. One should buy only puts if we feel market correction is likely. This way you minimise your loss and also they act as hedging to your equity stocks.

Markets will open with a bang again and we should see a good rally before some profit booking happens. There will be volatility again as markets have run up quiet sharply recording the biggest gain in single day. At this pace we should see 19K very soon as US markets also rallied smartly on hope of another FED rate cut. If this happens then RBI may also cut rates here and we should some good amount of buying in banking stocks and this Dipawali should be very bright with 20K also in sight.

However all said, there are many other factors which may spoil the bulls party. We are in such a position that even a slight amount of bad news could pull the sensex sharply. Remember that if 800 points rally is possible then 1500 downfall is also easily possible at this level. If you are a long term investor be prepared for it. Those who are entering for short term should be cautious and book profits at every level to be safe.

Jai Corporation is hitting circuits even after ex bonus and stock split and currently stock is close to touching 1000 which means 20000 ex bonus and stock split. I had given target of 10K when it was 6K. Later revised to 15K.

IFCI, Nagarjuna Fertilisers, Tata Tele, Arvind Mills all are moving on speculation and so enjoy the rally. IDBI, SBI will be good performers in banking.

If you remember that I had recommended Infosys as the best stock in IT sector which will perform against all odds. Infy contributed 152 points in the rally from 17K to 18K and gave decent returns to those who bought it around 1750 to 1800 levels.

Powergrid, NTPC, BHEL all will have bright future for long term and if nuclear deal materialises then these stocks will have more value. Remember to pick stocks which have unique model like GMR infra whose business model is different with good revenues assured.

At present try to enter the market for quick gains and be prepared for small losses in case market is volatile. If you are a long term investor then stay put with your zero cost stock portfolio. Use this opportunity to add some more zero cost stocks to your portfolio.

I will keep you guiding on a daily basis. Please post your feedback in this blog by leaving your comments.