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.

***************************************************************************
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 :)