29 July 2010
28 July 2010
A guide to Forbes India 20 stocks portfolio
By: Pravin Palande, T Surendar/Forbes India
Around this time last year, Mumbai was still impatiently waiting for the arrival of the monsoons. It would have been the season’s best reprieve for anxious investors who were till then reeling under the heat of a global market meltdown. In retrospect though, it may have been the ideal starting point for Indian investors.
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Exactly a year before now, in our first cover story on the markets, we had recommended that investors resume buying. We had recommended a portfolio of 20 stocks that would mirror an array of opportunities the Indian economy presented.
A year later, barring two companies, the portfolio has ended with positive returns. Three companies P&G, Page Industries and Pidilite have returned 100%. Five other stocks gained 70%.
On the whole, the Forbes India 20 portfolio was up 54%, compared to 45% of the mid-cap index (most of our recommendation was from this category). The broad market went up by 15% during the same time.
To be honest, there were enough easy pickings. Many companies were powering ahead before the global bust and yet, their valuations had fallen off the cliff. Almost all our stock picks had a strong domestic story that helped insulate them from the global instability.
But that was last year. Many Indian companies are now quickly reaching their pre-slump level in sales. Having scaled back expansion plans, they will soon churn out their full capacities, leaving little headroom for volume growth.
Investors have already guessed that Indian companies will continue to perform well, and lapped up stocks at prices that have already discounted the current financial year’s earnings.
Our considered opinion is that any investments in the stock market may not yield above-average returns in the next one year.
Morning views
hakti Pumps losing steam as investors offload shares
Shares of Madhya Pradesh-based Shakti Pumps, manufacturer of submersible pumps and motors, have been weighed down by selling pressure in the past couple of sessions.
The stock, which fell 4.3% to Rs 285.50 on Tuesday, has fallen over 15% in the past couple of days after witnessing a sharp rally in the past few months on large volumes. Dealers tracking the counter say that some wealthy investors, who had loaded up the stock, are selling.
According to the market buzz, the company was rumoured to be close to bagging some large orders from the government. But in the absence of any such announcement, these investors dumped the stock. The stock clocked a high of Rs 340 last Friday.
Ferro Alloys in demand on stake sale buzz
Ferro Alloys Corporation has been in the thick of activity on bourses of late on talk some groups are in the race to buy a stake in the company.
Initially, the talk was that the promoters of Ferro Alloys’ were only interested in selling a minority stake. Subsequently, there was speculation that a majority stake sale was also being explored. However, differences over valuations between prospective buyers and the promoters have led to talks getting stalled.
Brokers said promoters are demanding at least Rs 50 per share, while the prospective buyers are not willing to pay that much, especially as the stock is currently trading at about Rs 31. Ferro Alloys officials were unavailable for comment on the matter. The stock has risen about 17% in the last six sessions.
Shares of Madhya Pradesh-based Shakti Pumps, manufacturer of submersible pumps and motors, have been weighed down by selling pressure in the past couple of sessions.
The stock, which fell 4.3% to Rs 285.50 on Tuesday, has fallen over 15% in the past couple of days after witnessing a sharp rally in the past few months on large volumes. Dealers tracking the counter say that some wealthy investors, who had loaded up the stock, are selling.
According to the market buzz, the company was rumoured to be close to bagging some large orders from the government. But in the absence of any such announcement, these investors dumped the stock. The stock clocked a high of Rs 340 last Friday.
Ferro Alloys in demand on stake sale buzz
Ferro Alloys Corporation has been in the thick of activity on bourses of late on talk some groups are in the race to buy a stake in the company.
Initially, the talk was that the promoters of Ferro Alloys’ were only interested in selling a minority stake. Subsequently, there was speculation that a majority stake sale was also being explored. However, differences over valuations between prospective buyers and the promoters have led to talks getting stalled.
Brokers said promoters are demanding at least Rs 50 per share, while the prospective buyers are not willing to pay that much, especially as the stock is currently trading at about Rs 31. Ferro Alloys officials were unavailable for comment on the matter. The stock has risen about 17% in the last six sessions.
27 July 2010
RIL Q1 net profit up 33.42% at Rs 4851 cr
RIL Q1 net profit up 33.42% at Rs 4851 cr
Mukesh Ambani group's flagship company Reliance Industries (RIL) has announced its results for the quarter ended June 2010. It has reported net profit at Rs 4851 crore as against Rs 3636 crore, a growth of 33.42% on year-on-year basis.
Net sales jumped 81.65% to Rs 58,228 crore from Rs 32,055 crore. Numbers were in-line with expectations; CNBC-TV18 expected net sales at Rs 59,300 crore and net profit at Rs 4820 crore.
Refining revenues increased 106.81% to Rs 50,531 crore from Rs 24,434 crore and petchem revenue rose 18.8% to Rs 13,903 crore from Rs 11,707 crore (YoY).
Petchem earning before interest & tax (EBIT) declined to Rs 2,053 crore from Rs 2,109 crore while refining EBIT jumped to Rs 2,035 crore from Rs 1,299 crore.
Petchem margins came in at 14.8% and refining margins at 4%. Operating margins stood at 16%.
Gross refining margin (GRM) came in at USD 7.3 a barrel.
Net sales jumped 81.65% to Rs 58,228 crore from Rs 32,055 crore. Numbers were in-line with expectations; CNBC-TV18 expected net sales at Rs 59,300 crore and net profit at Rs 4820 crore.
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Petchem earning before interest & tax (EBIT) declined to Rs 2,053 crore from Rs 2,109 crore while refining EBIT jumped to Rs 2,035 crore from Rs 1,299 crore.
Petchem margins came in at 14.8% and refining margins at 4%. Operating margins stood at 16%.
Gross refining margin (GRM) came in at USD 7.3 a barrel.
HUL Q1 net profit down 8.3% at Rs 512.4 cr
L&T Q1 net profit up 15% at Rs 666 cr
RBI rates may make auto, home loans dearer
RBI hikes short-term rates; CRR unchanged
Impact analysis: Monetary Policy Review
Result Analysis: Hindustan Unilever
L&T net up 15% at Rs 666 cr
RESULT ANALYSIS: NTPC
Src: ET, Smartinvestor, Moneycontrol
26 July 2010
My Favorite Market Blogs
Few of My Best and Favorite Market Related Web Blogs/Websites. I always look these blogs for investing and trading. Simply super. Some offers Premium services. These are Few of My Blogs I Regularly Follows. I request all the investors and traders use these sites for investing.
25 July 2010
Market Outlook: RIL Result, RBI Meet eyed
TECHNICAL ANALYSIS: Index Outlook: Action-packed week ahead
It was one of those rare weeks in which index movement went almost unnoticed. Changes in takeover code and new GST system hogged the headlines along with the first quarter earnings, keeping the attention of market participants riveted. The ...
STOCKS: BHEL: Buy
Investment Focus. Bharat Heavy Electrical's (BHEL's) strong footing in the power equipment space has not come under much threat despite domestic and foreign competition. Combined with a strong order book and robust financials, BHEL's earnings ...
PUBLIC OFFER: Engineers India — FPO: Invest
The high-end engineering, design and consulting business of Engineers India is not only unique but also lucrative given its presence in the hydrocarbon space. Earnings growth of 38 per cent compounded annually over the last three years, a ...
STOCKS: Sesa Goa: Book profits
Iron ore major Sesa Goa appears to be a risky play in the metals space considering the uncertain outlook on iron ore realisations and demand from the export market. The company's reliance on the Chinese market, where iron ore prices and ...
It was one of those rare weeks in which index movement went almost unnoticed. Changes in takeover code and new GST system hogged the headlines along with the first quarter earnings, keeping the attention of market participants riveted. The ...
STOCKS: BHEL: Buy
Investment Focus. Bharat Heavy Electrical's (BHEL's) strong footing in the power equipment space has not come under much threat despite domestic and foreign competition. Combined with a strong order book and robust financials, BHEL's earnings ...
PUBLIC OFFER: Engineers India — FPO: Invest
The high-end engineering, design and consulting business of Engineers India is not only unique but also lucrative given its presence in the hydrocarbon space. Earnings growth of 38 per cent compounded annually over the last three years, a ...
STOCKS: Sesa Goa: Book profits
Iron ore major Sesa Goa appears to be a risky play in the metals space considering the uncertain outlook on iron ore realisations and demand from the export market. The company's reliance on the Chinese market, where iron ore prices and ...
STOCKS: Hitachi Home & Life Solutions (India): Buy
Investors with an appetite for risk can consider investing in the stock of Hitachi Home & Life Solutions (India) at the current price of Rs 337. The stock, though at a high now, offers scope for gains in the medium term given the pace ...
IPOS: SKS Microfinance IPO: Invest
Investors with a high risk appetite can consider subscribing to the Initial Public Offer (IPO) of SKS Microfinance, one of the largest microfinance NBFCs .
24 July 2010
Stock and Market Views
LONDON/MADRID: Seven European banks would not be strong enough to withstand another recession and would face a capital shortfall of 3.5 billion euros ($4.5 billion), tests run in an attempt to revive investor confidence showed on Friday.
Five of Spain's smaller regional lenders, known as cajas, failed the test and their recapitalisation is likely to speed a restructuring of the troubled sector.
Banks in Germany and Greece were also seen as weak spots and in need of restructuring, but state-owned Hypo Real Estate was the only German lender to flunk and state-controlled ATEbank was the only Greek bank to fail.
Analysts had expected five to 10 banks to fail the test. As expected, no big banks failed the health check. German government bond futures hit one-month lows and the euro briefly pared its losses against the dollar after the results were released.
Europe tested how 91 banks would cope with another recession and losses on government debt after the Greek crisis hit markets and raised fears the euro zone could unravel. It aimed to repeat a health check on US banks last year that helped restore investor confidence and underpinned a recovery by bank shares.
Five of Spain's smaller regional lenders, known as cajas, failed the test and their recapitalisation is likely to speed a restructuring of the troubled sector.
Banks in Germany and Greece were also seen as weak spots and in need of restructuring, but state-owned Hypo Real Estate was the only German lender to flunk and state-controlled ATEbank was the only Greek bank to fail.
Analysts had expected five to 10 banks to fail the test. As expected, no big banks failed the health check. German government bond futures hit one-month lows and the euro briefly pared its losses against the dollar after the results were released.
Europe tested how 91 banks would cope with another recession and losses on government debt after the Greek crisis hit markets and raised fears the euro zone could unravel. It aimed to repeat a health check on US banks last year that helped restore investor confidence and underpinned a recovery by bank shares.
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