How Obama's reforms could affect banks

How Obama's reforms could affect banks



US President Barack Obama is looking at limiting risk-taking at banks.

But his proposals on Thursday were tantalizingly vague. He said he wanted to limit the amount of borrowing that banks can do relative to their peers and limit their trading activities to buying and selling securities to customers.

But it is not clear whether relative borrowing limits will be low enough to force banks to reduce their debt. And the line between buying and selling securities on behalf of customers, and doing so on behalf of the bank, can be blurry.

RELATED NEWS Obama 'makes Bush look like a genius': Marc Faber Analysis: Obama takes on 'too big to fail' banks Banks may shed private equity assets in Obama plan

RSS feed for news Click here

The White House has also said it wishes to prevent banks from investing in and sponsoring hedge funds and private equity firms, but it is not clear if banks will also be prevented from financing these clients, which can itself be risky.

Wall Street firms are likely to fight any efforts at reform, and President Obama has lost some political capital after a bruising effort to pass health care reform, and losing a Senate seat in a special election in Massachusetts.

Any legislation will take months if not years to wind its way through Washington, and predicting how it will the law will end up working is difficult. But here are some possible outcomes of Obama's efforts:

Killing it softly

On a conference call with journalists, Goldman Sachs Chief Financial Officer David Viniar said he had not seen details of Obama's plan, but that he generally appreciates government policies that stabilize the financial system.

Experts said that banks were unlikely to publicly disagree with Obama, but are sure to furiously lobby behind the scenes to water down any proposal that the president and legislators put forward.

Banks took similar steps when rulemakers and lawmakers sought to move more derivatives trading onto exchanges and into clearinghouses. Although trade groups initially said they supported efforts at reform, proposals now look likely to be watered down. Obama's efforts to reduce risk taking could meet a similar fate.

Whether that is a good thing is debatable. Major banks including Lehman Brothers took large proprietary bets that resulted in big losses, and in Lehman's case, forced it into bankruptcy. But many bank executives are quick to argue that if they can't do this kind of trading, foreign banks and unregulated domestic entities will, which may not reduce systemic risk.

Gray hair triumphs

A number of elder statesmen of the financial world, most notably former Federal Reserve chairman Paul Volcker, believe that Obama is right, and that large banks should be severely constrained from making bets with their own funds.

Obama seems keen to personally shepherd these changes through Congress, and given the populist outcry against Wall Street, he may have the political capital to do so.

If he is successful, the biggest banks will likely shrink further. Obama's fee on bank's liabilities, announced last week, may collect less money than originally planned.

Talented risk-taking traders will move to hedge funds and private equity firms, where their failures could have less of an impact on the broader market.

Trading volume on major exchanges and in many financial markets may drop, because smaller players will have less capital available to consistently trade. Shares of exchanges dropped on Thursday — NYSE Euronext dropped 3.9%, while CME Group Inc fell 5.8%.

The biggest banks will likely become even less profitable, and more like staid, slow-growing utilities that pay high dividends to shareholders.

One question that remains is how far Obama will go in limiting banks from risk activities. Will a bank holding company be allowed to own a hedge fund, even if the regulated bank subsidiary cannot? Will commercial banks be barred from all investment banking activities? Will foreign banks that operate in the United States be constrained?

Also unclear is whether some institutions, such as Goldman Sachs, will be able to shed their bank charters to avoid restrictions on trading. Goldman Sachs CFO Viniar said on a conference call that the bank has no plans to get rid of its charter. Many investors believe it ought to, but regulators may balk at a move that would give them less oversight over a company whose health is critical to the financial system.

Rules change, but banks backslide

Even if Obama successfully implements his risk limitations, banks may find ways around them. Banks, for example, could buy securities and claim they were doing so in anticipation of client demand, when in fact they intended to make bets on the securities and hold onto them themselves. Or bank holding companies could engage in risky activity that leaves their subsidiary banks worse off.

But if regulators are sufficiently vigilant, and limit risk-taking across many businesses in the financial sector, the brainpower that Wall Street devotes to finding loopholes may migrate to other sectors of the economy. From Obama's standpoint, this may be the most positive scenario.

******************************************

Equities will lord over mkts in 2010: Ridham Desai

• Atul Suri says bull mkt is not over, suggests sectors
• Present leg of correction may be over: Experts

Maruti Suzuki Q3 net soars threefold

Bharat Forge Q3 net zooms 8.73 times net sales rose 13.61% >>more

Chambal Fertilisers Q3 net rises 5.90% total income decreased 8.05% >>more

Maruti Suzuki Q3 net soars threefold net sales increased 62.50% >>more

Indian Bank Q3 net rises 25.86% interest earned rose 12.93%. >>more

Essar Oil net loss narrows to Rs 2,260 mn in Q3 Net sales rose 18.26% >>more

Debt Funds gainers for the week ended Jan.22 NAVs gained 0.09% in the week. >>more

4 stocks with `Hold` rating Rolta India,Jaiprakash Associates,... >>more

*****************************************

CNBC-TV18 Poll: RBI may hike CRR by 50 bps

L&T vs BHEL vs Punj Lloyd: Which one should you buy now?

9 stocks that were buzzing last week, how to trade them now

BNP Paribas' sector/stock picks post Q3 earnings

Kotak Institutional's stock/sectors picks post earnings

Inflation may trigger tighter monetary policy

Friday, January 22, 2010

Bajaj Auto - Stock Analysis & Stock Report

LKP Shares, stock trading broker has recommended to buy stocks on Bajaj Auto with target price of Rs 2,100 against current market price (CMP) Rs 1,800.

The stock investment research team of broker said that the company has posted significant growth in Q3FY10. The management is very positive on the company`s growth banking upon the recent launch of Pulsar last month and looking forward to the new launch by April.


Market Cap 25,938.14
* EPS (TTM) 89.97
* P/E 19.93
* P/C 18.12
* Book Value 129.23
* Price/Book 13.87
Div(%) 220.00
Div Yield(%) 1.23
Market Lot 1.00
Face Value 10.00
Industry P/E 29.33

Bajaj Auto's results outperformed the street expectations. The company's strong thrust on the entry-level segment has fetched it market share gains. After recording a peak margin of 22% in the last quarter, the company surprised us by maintaining them at the same level.

Going forward, we expect increased input costs to pull down the full year margins to 20.2%. However, the robust volume growth, and cost saving at employee expenses level and marketing costs may somewhat offset this increase. Success of Discover 100cc along with the Pulsar models and the upcoming new launches in the Discover family will provide a strong boost to the topline. Growth in the exports along with new launches in the three wheeler segment will also provide a strong boost to the topline.

At CMP of Rs 1800, the stock is trading at FY11 P/E of 13.2, on an FY11E EPS of Rs 136.5. We believe the stock is looking attractive and hence recommend a BUY rating on the stock with a targetprice of Rs 2,116, which translates into an upside of ~22%.

--------------------------------------------------------------------------------------------------------------------------------------

Polaris Software - Stock Investment Research Report

Anand Rathi, stock trading broker and stock investment research firm has recommended to buy stocks of Polaris Software with target price of Rs 250 on Jan. 21, 2010.

Polaris Software looks to be a good mid cap stock. It has reported a good set of 3Q figures, with USD revenue rising 3.9% qoq. They raise FY10-12 earnings estimates slightly. It has won 30 new deals, the highest in a single quarter over the last two years. They reiterate itsBuy stocks rating and target price of Rs 250.

Key points from the 3Q results. Polaris Software`s 3QFY10 revenue grew 0.2% qoq (rupee) and 3.9% (USD). Margin was flat qoq. Consolidated net profit rose 13.9% qoq.

The company won 30 new deals, the highest in any quarter in the last two years.
Geographically, Europe was down 1.3% while ROW grew 1.2%.

Market Cap 1,725.04
* EPS (TTM) 13.05
* P/E 13.37
* P/C 10.05
* Book Value 70.21
* Price/Book 2.49
Div(%) 55.00
Div Yield(%) 1.58
Market Lot 1.00
Face Value 5.00
Industry P/E 24.02

Polaris has maintained its EPS guidance for FY10 of Rs. 15/-

The stock investment research house pointed out at target price of Rs 250, the stock would trade at 12 times FY-11e earnings. At this stock valuation, Polaris would trade at a 33% discount to IT large caps.

--------------------------------------------------------------------------------------------------------------------------------------

Wednesday, January 20, 2010

Stock Market Trading Tips - Investment For Mid-Term Time Frame

Here are 3 stock market trading tips provided by Mr. Himanshu Tiwari. He has provided these stock trading tips as his recommended hidden gems.

*******************************************

Syncom Healthcare IPO Analysis

IPO - Aqua Logistics Analysis

Thangamayil Jewellery IPO Analysis

Maharashtra Seamless

Vascon Engineers IPO Analysis

Indraprastha Gas

Weekly Analysis - Jan 24 2010

Obama unleashes new regulations on Wall Street

Jubilant FoodWorks IPO subscribed 30.86 times

Food inflation drops to 16.81%

United Spirits

Biocon

Src: Moneycontrol, DP Blog, ET and Etc.. etc

Know a Web, Personality and a Company

Web:

http://ninite.com/

Persoanlity

Yogesh Chander Deveshwar

http://en.wikipedia.org/wiki/Yogesh_Chander_Deveshwar

Company

ITC Limited

http://en.wikipedia.org/wiki/ITC_Limited

Src: Wikipedia.Org

Know A Website: SmartInvestor.In

I have found a new Website which having All features, Equity News, Derivatives, Charts and etc etc etc.... Kindly Advise All of YOU to use this Website as a Investing Tool... Very Very Superb Website in Recent Times....

http://smartinvestor.in/index.php

Research Reports @

http://smartinvestor.in/market/mktNews-researchreport.htm

RIL Q3 cheers street; net up 14.5 per cent

RIL Q3 cheers street; net up 14.5 per cent


MUMBAI: The country’s oil, gas and petrochemicals giant Reliance Industries sprung a positive surprise for the market with its earnings

Q3 Earnings Q3 Earnings Impact

declaration for the October-December quarter, thanks to a surge in gross refining margins.

The company reported a net profit of Rs 4008 crore, up 14.48 per cent from Rs 3501 crore in the corresponding period a year ago. The standalone net sales grew to Rs 56,856 crore for the quarter ended on Dec 31, 2009 from Rs 31,563 crore in the same quarter previous year.

During the quarter, the revenue from petrochemicals business rose 17 per cent year-on-year to Rs 14,756 crore and gross refining margins were recorded at $5.9 per barrel. Meanwhile, its Q3 refining revenues soared 143 per cent.

PN Vijay of askpnvijay.com was of the opinion that Reliance’s performance in Q3 has been a great relief for the market which has currently been wilting under global weakness. “If RIL Q3 would have fallen short of expectations, then the market would have been beaten down severely. Given that the GRMs held intact, it just signals bullishness in the petchem business.”

Rohit Nagraj, research analyst at Prabhudas Lilladher said that the brokerage will maintain status quo on its ratings on Reliance Industries. Nagraj added, “But the major surprise came in from the GRMs front. We were expecting the company to record $5.3/bbl, however, the figures came in at $ 5.9/bbl. Given the revival in refining business is a positive sign going forward.”

Furthermore, Nagraj said that Prabhudas Lilladher has forecast Reliance’s GRMs for Q4 at $6/bbl. However, he added that given the strong GRMs this quarter and if the current trend continues, further upside is expected.

Also Read

→ Get ready for a perfect take off with Kingfisher

→ Revision in gas prices to set tone for future growth of ONGC

→ Maintaining profits may get tougher now for ICICI Bank

→ Analysts divided over RIL Q3 show

Commenting on the gross refining margins, Victor Shum, senior principal, Purvin & Getz said, “Some more recovery is likely for refining margins. However, it remains a touch environment for GRMs for the remainder of this year. But Reliance Industries is in a very competitive position and will be able to maintain GRMs as compared to the rest of the industry.”

Giving a technical call on the stock, Rohit Shinde, associate vice president at CD Equisearch said, “The key resistance for the stock lies at Rs 1150. Reliance Industries, for the last couple of sessions, has not been able to sustain above 1150. Stochastics have given a breakdown which is a negative sign for the stock. However, the bounceback witnessed today on the back of strong results may not hold. Some amount of volatility is expected towards the later half of the session which is an ideal opportunity for shorting the market.

The company’s shares recovered from the day’s low post the earnings declaration. The stock was trading at Rs 1057.80, higher by 0.36 per cent on the NSE, easing from a low of Rs 1029.50.


Analysts divided over RIL Q3 show

RIL beats street, Q3 net profit up 14.5% to Rs 4,008 cr

******************************************
Bharti Q3 net up 2.4%, beats forecast

NEW DELHI: Bharti Airtel Ltd, India's top mobile operator, reported a small rise in quarterly profit growth, broadly in line with expectations,

Q3 Earnings Q3 Earnings Impact

as a vicious price war hits margins in the booming industry. ( Watch )

India, the world's fastest-growing mobile services market, is signing up over 14 million users a month, but competition is getting fiercer as new entrants slash call rates to grab subscribers.

Global players such as NTT DoCoMo and Telenor are pushing down call rates to as low as 0.7 U.S. cents a minute as they seek a foothold in a market expected to double to 1 billion users by 2014.

New Delhi-based Bharti, in which Southeast Asia's top phone firm SingTel owns more than 30 percent, continues to focus on robust market share despite the "hyper competition" in the market, Chairman Sunil Mittal said in a statement.

Bharti said net profit rose 2 percent to 22.10 billion rupees ($478 million) under U.S. accounting rules in its fiscal third quarter ended December from 21.59 billion a year ago.

Revenue rose 1 percent to 97.72 billion rupees from 96.33 billion. A Reuters poll of 12 brokerages had forecast a fall in net profit to 20.96 billion rupees on revenue of 97.10 billion.

Bharti added 8.4 million mobile users in the quarter to reach a total of 119 million by end-December.

Shares in Bharti, valued at about $27 billion, rose as much as 2.4 percent soon after the earnings in a weak Mumbai market. By 0410 GMT, the stock was up 1.3 percent at 326.20 rupees while the benchmark was down 2 percent.

Average revenue per user fell 29 percent to 230 rupees in the December quarter from a year ago as more than half of new users came from rural areas, where spending is lower, and average minutes of usage also fell 12 percent to 446 minutes.

Bharti shares fell 21 percent in Oct-Dec underperforming the broader market that rose 2 percent. Bharti and rival Reliance Communications were the only two stocks that fell in 2009 in the main index, which jumped 81 percent.

Shares in Bharti Airtel rose more than 2 per cent, after it reported a 2.4 percent rise in quarterly profit, beating forecasts. Shares rose to 329.80 rupees, up 2.4 percent, after having been down 2.2 percent earlier.

******************************************
ITC December quarter net rises 27%; beats forecast

ITC December quarter net rises 27%; beats forecast

Three months ending December 31 (versus the same period a year earlier)

Net profit 11.4 vs 9.0

Net sales 45.3 vs 38.3

NOTE: ITC Ltd, 31.7 per cent owned by British American Tobacco, is India's top cigarette maker. It also makes consumer goods and runs hotels. The figures are standalone.

Thomson One Estimates forecast net profit at Rs 10.78 billion.

ITC Q3 net profit up 26.7% at Rs 1,144.17cr



Src: ET and Moneycontrol etc

Evening Reports

Nifty closes below 5100; L&T, Siemens down


MUMBAI: Sustained selling pressure across the board saw benchmarks close near lowest levels of the day. All the sectoral indices ended in the red

How to invest in 2010 Sectors with potential in 2010 Investment resolutions for 2010 Risks you'll be running in 2010

with capital goods and power stocks worst hit.

National Stock Exchange’s Nifty ended at 5093.60, down 128.10 points or 2.45 per cent. The broader index touched a low of 5085.45 and high of 5220.35.

Bombay Stock Exchange’s Sensex closed at 17050.67, down 423.82 points or 2.43 per cent. The 30-share index hit a low of 17025.26 and high of 17474.49.

BSE Midcap Index was down 2.34 per cent and BSE Smallcap Index slipped 2.47 per cent.

All the sectoral indices were in the red. BSE Capital Goods Index was down 5.17 per cent, BSE Power Index declined 3.52 per cent and BSE Realty Index slipped 2.88 per cent.

L&T (-6.59%), Siemens (-6.41%), Tata Power (-4.73%), BHEL (-4.51%) and Suzlon Energy (-3.83%) were amongst the top Sensex losers.

Shares of Larsen & Toubro fell following disappointing results. The company’s standalone net profit rose to Rs 758.82 crore for the quarter ended December against Rs 1520.44 crore in the same quarter a year ago. Net sales stood at Rs 8071.37 crore against Rs 8593.96 crore .

BHEL reported net profit of Rs 1072.59 crore for the quarter ended December against Rs 790.56 crore in the same quarter a year ago. Net sales grew to Rs 7100.34 crore for the quarter against Rs 6022.25 crore a year ago.

Mahindra & Mahindra, up 0.31 per cent, was the lone gainer in the 50-share index.

Market breadth on BSE was sharply negative with 2369 declines against 537 advances.

(All figures are provisional)

Sensex ends 2.4% down on L&T nos; cap goods dips 5%

The benchmark Sensex today closed down by over 400 points on the back of disappointing Q3FY10 numbers from the infrastructure major Larsen & Toubro. The company's Q3 adjusted PAT (profit after tax) was up 15.21% to Rs 696 crore and net sales were down 6% at Rs 8,071 crore, which were below the market expectations.

Wholetime Director and Chief Financial Officer YM Deosthalee said, “De-growth [in sales] is mainly due to delays seen in certain projects though there are no cancellation of orders. Some irrigation projects were delayed due to fund constraints, road projects have seen a slow pick-up and decision-making in some jobs was slow.”

L&T also saw difficulty in financial closure for some projects, he said. “We did not foresee the execution capabilities in a few orders.” However, “Growth in the fourth quarter would be much higher than in the third,” Deosthalee said.

The 30-share BSE Sensex closed at 17,050, down 423 points and the Nifty was at 5,093, down 128 points, as per provisional data.

********************************************************************

Q3 earnings: BHEL, Biocon, L&T, Dr Reddy's, JSW Steel, Wipro, TVS Motors

*******************************************

ICICI Bank Q3 net falls 13.4%; smaller than forecast

BANGALORE: ICICI Bank, India's No.2 lender, reported a smaller-than-expected 13.4 percent drop in quarterly net profit, as demand for retail

Q3 Earnings Q3 Earnings Impact

loans helped offset the impact of a drop in treasury income.

ICICI said its October-December net profit fell to Rs 1,101 crore ($239 million) from Rs 1,272 crore a year earlier. A Reuters poll of analysts had forecast net profit of Rs 1,055 crore.

Indian banks were mostly insulated from the direct impact of the global credit crisis, but the world downturn hit the country harder than expected leading to a sharp slowdown in credit growth in the current financial year.

Demand for credit is expected to pick up in the near future, as improving business and consumer confidence brings back corporate, housing, auto and retail demand in Asia's third-largest economy.

Shares in ICICI Bank, valued at $21 billion, fell 3 percent in October-December, lagging a small gain in the sector index.

********************************************

• Biocon Q3 net jumps three-fold to Rs 81 cr
• L&T Q3 net up 26%, beats forecast
• Dr Reddy’s takes Rs 233-cr knock
• JSW Steel posts Rs 422-cr profit
• Spice Communications suffers Rs 67-cr net loss
• TVS Motor Q3 net at Rs 24 cr

• BHEL Q3 net up 35 pc to Rs 1,072 cr
  21 Jan 2010, 1436 hrs IST

  Bharat Heavy Electricals Ltd today reported a growth of 35.67 per cent in its net profit at Rs 1,072.5 crore for third quarter ending December 31, 2009, over the same period last year.

• Kingfisher Airlines Q3 net loss at Rs 419 cr
  21 Jan 2010, 1031 hrs IST

  Kingfisher Airlines today said its net loss for the third quarter ending December 31, 2009, has widened to Rs 419.96 crore.

• HDFC net up 23% on NPA dip, better NIM
  21 Jan 2010, 0231 hrs IST

  The country’s largest mortgage financier, Housing Development Finance Company (HDFC), reported a 23% jump in profits for the third quarter.

and more @ http://economictimes.indiatimes.com/News/News-By-Company/Earnings/articlelist/75410.cms

****************************************

Two high beta stocks at 200 dma

Ten things you should know about Jubilant Foodworks

NIFTY: Road to Nowhere

State of Global Markets

Src: ET, and etc

MOrning Calls

	Two Attractive Mid Cap Stocks Sanjay Chhabria Sanjay Chhabria Jan 19, 2009 Manaksia Ltd (Rs 108) (Rs 2 Paid Up) (BSE Code – 532932, NSE Code - MANAKSIA) (P/E - 6.5, FY’09 Net Sales - Rs1,485 cr, Market Cap - Rs750 cr) Manaksia Limited (formerly Hindusthan Seals Ltd., incorporated in 1984) is a multi-division and multi-location conglomerate. It possesses 15 manufacturing plants in India and three abroad; two in Nigeria and one in Ghana. Manaksia specialises in the manufacture of packaging products (crowns, closures and metal containers), metal products and fast moving consumer goods, among others. The company's metal packaging products include crowns, roll-on pilfer-proof closures, expanded polyethylene liners as well as push-open and other metal containers. In the fast moving consumer goods segment, the company is a dependable mosquito repellents outsourcing destination for the Mortein (owned by Reckitt Benckiser (India) Limited) and Maxo (owned by Jyothy Laboratories) brands. The company has now diversified into the production of aluminium rolled products, secondary specification aluminium alloys and galvanised steel. The company’s wholly owned subsidiary in Nigeria, MINL Limited, was set up in 1996 and is the market leader in ROPP caps and crown corks in Nigeria. It has also set up facilities for the manufacture of galvanised steel, metal colour coated sheets and coils and secondary specification aluminium alloys. The company also has subsidiary companies in Ghana (Dynatech Industries Ghana Limited) and Dubai (Euroasian Ventures FZE). Manaksia manufactures value-added metal products and metal packaging products. The Kolkata-headquartered Manaksia Group is India’s largest secondary producer of value-added aluminium rolled products with 15 manufacturing facilities in the country and three abroad. The business of the Manaksia can be categorised into metal products, packaging products, mosquito coils, and engineering and other goods. For funding its expansion plans and general corporate purposes, the company had come with an IPO of Rs 248 cr., comprising fresh issue of 155 lakh shares at Rs 160 per share(Rs 2 paid up) in December 2007. Manaksia has vertically integrated across a number of products, resulting in reduction in manufacturing cost. Its metal-management skills and innovations in manufacturing and product enhancement have enabled it to manufacture advanced metal packaging products and retain and add customers like Hindusthan Coca Cola Beverages (Coke), Reckitt Benckiser, Dabur India, Jyothy Laboratories, Eveready Industries and McDowell Group and other major beer and liquor manufacturers. The aluminium division has attracted reputed alloy ingot users like TVS Motor, Orient Fans and Toyota Tsusho Corporation as customers. The company does the bulk of its business in Nigeria, which offers two main advantages. One, it gets aluminium scraps at a cheaper rate compared to international prices since the export of aluminium scrap is banned by the Nigerian government. Second, it gets cash incentives on export of the finished products. Since the company has been getting this benefit for more than a decade, it expects this trend to continue for the next few years too. In the fiscal 2008-09, Manaksia’s consolidated net sales stood at Rs 1,485.06 cr., up from Rs 1,147.37 cr. in 2007-08. The consolidated profit after tax in 2007-08 was Rs 106.3 cr. (Rs 128.19 cr.). This translated into an EPS of Rs 15.3 on Rs 2 paid up share(Equity-13.9 cr. Promoters’stake- 58.1%) and P/E multiple of 5.3 at its current price of 82. A 110% dividend (Rs 2.2 on equity shares of the face value of Rs 2 each) was declared for 2008-09. For the half year ended Sept. 2009, Manaksia has posted net profit of Rs 56.62 cr. on net sales of Rs 596 cr. on consolidated basis. The EPS for half year stands at Rs 8.14 Going forward, the company plans to focus on its metal business, which mainly consists of steel and aluminium-rolled products. Manaksia claims to be the largest player in secondary aluminium rolling in India. This gives the company economies of scale and helps it to reduce raw material costs, thereby resulting in better operating margins. The company has strong technical know-how in producing value-added metal products and expects to leverage this to generate higher profits. Some of the company’s metal products are also supplied to auto majors like Maruti Suzuki and Toyota. The management expects the metal business will grow at decent rates in coming years on a conservative basis. At current levels, the stock trades at 7 times its FY2009 earnings(Rs 15.3) and 6.5 times its estimated FY 2010 earnings(Rs 16-17). Investors can start accumulating the stock at current levels and add more on declines for decent returns of 40%-45% over the next 6-8 months. Repro India Ltd (Rs 113) (BSE Code- 532687 NSE Code- REPRO) (P/E- 7, Promoters’ stake-68.78%, Market Cap - Rs117 cr) Repro India Limited is one of the few integrated print solution provider and a manufacturer and exporter of books in the highly fragmented printing industry. Its solutions include content management, configuration to content delivery and the entire supply chain for publishers. The Indian Printing industry has managed to grow at a CAGR of 14% over the last 25 years. to touch Rs 1100 cr.. That is almost twice the GDP growth rate. Repro has successfully evolved from a printing press to an end-to-end print solutions provider. The company provides value-added printing and prints related solutions to major publishing houses, corporates and software companies. The clients of the company include publishing houses such as Alligator Books, Macmillan, Orient Longman, Oxford University Press ; software companies Microsoft , Oracle, IBM; and Indian corporates including Tata Steel, Infosys, Wipro etc. RIL had come with an IPO in November 2005 at Rs 165 per share and raised Rs 43.2 cr.. RIL’s equity stands at 10.47 cr. out of which promoters hold 68.78% while the public holding is 15.19%. Through content process outsourcing, Repro offers content, creativity and designing. It provides desktop publishing, ideation, content creation, designing, illustration and copywriting. Content Process outsourcing is another large opportunity for India and holds great potential as we have a low cost talent pool, design and creative capabilities and knowledge of English language. Countries like USA and the UK, which are considered among the largest markets for printing industry, are increasingly looking at outsourcing to low cost countries such as India. Repro offers print solutions for educational and children’s books for the publishing industry and annual reports and other corporate print solutions for corporates. Digital printing is utilised for IT industry and print on demand (POD). It also services the insurance industry through POD. Repro is also into contractual publishing—magazine printing and others like replication of CDs and stock management activities For the half year ended Sept. 2009, Repro posted Adjusted net profit of Rs 8.8 cr.(down 23%) on net sales of Rs 103.5 cr. (down 4%). EBIDTA fell 12% to Rs 16.8 cr. and net profit fell 45% to Rs 5.13 cr.. The major reason for fall in sales was that the impact of the global meltdown which led to delay in execution of large no. of export orders on account of Repro waiting for the client to tie up for the money or open the LC’s.. The situation has changed now and the growth prospects look optimistic in the coming quarters. Repro has an order book position of about Rs 130 cr.(of which Rs 35 cr. is domestic and rest is exports) to be executed in the next six months. Repro had posted a healthy 57% growth in topline to Rs. 241 cr, for FY09 while net profit grew just 6.5% at Rs 16.55 cr..(up 6.5%) due to forex losses of 16.5 cr.. On a equity of 10.47 cr., the EPS stood at Rs 15.75 and the dividend declared was 25%. Almost 35% of the company’s turnover comes from exports. Its exports business holds significant revenue upsides as it shifts focus from straight printing to content process outsourcing(CPO). As the company would be focusing on CPO for its foreign clients it expects margins to grow in future. The expansion at Surat SEZ and Vashi units will also bring benefits this year. As the company scales up its business and sets up infrastructure to support its expansion in the exports market, it expects higher realizations in the years to come. The Repro stock appears attractive as it is valued at about 7.5 times expected FY10E(Rs 15) and at 5.6 times FY11E earnings(Rs 20). On account of increasing contribution from higher margin businesses and attractive valuations, the stock holds good potential for appreciation in the medium-long term. Investors can start accumulating the stock at current levels and add more on declines for decent returns of 40%-45% over the next 6-8 months. valueinv@sify.com 9893200307 Sanjay Chhabria is an equity analyst and investment consultant based at Raipur (Chhattisgarh). At the time of writing this, he doesn’t have any position in the stocks mentioned above. He is bringing a weekly Investment newsletter "Market-View" since April 2001 to help small (retail) investors take an informed investment decision. He invites Readers to send him email to get free 1 week trial offer of "Market –View". He also appears on CNBC TV 18(Mid cap radar). He welcomes comments, feedback & investor queries at valueinv@sify.com. Under no circumstances does the information in this report represent a recommendation to buy or sell stocks. This report has been prepared solely for information purposes and does not constitute a solicitation to any person to buy or sell a security. While the information contained therein has been obtained from sources believed to be reliable, no responsibility (or liability) is accepted for the accuracy of its contents. Readers using the information contained herein are solely responsible for their actions and are advised to satisfy themselves before making any investments.
	MTNL: Cash is king Rathin Shah
	IDFC: Buy at CMP Rs158 KRChoksey
	Technical calls: EID Parry, Financial Technologies, Canara Bank HDFC Sec

*******************************************
Top 5 picks of the day I Mid term picks of the day

**********************************************


Heard on the street

Satyam Computer down over 5% on L&T exit buzz Satyam Computer shares were among the biggest losers on Tuesday, shedding over 5% to close at Rs 110.35. Buzz is that L&T, one of the largest shareholders, is likely to exit its position in Satyam in the next few days. According to market buzz, Dubai-headquartered Legatum Group is among FIIs interested in picking up a slice of L&T’s 4.9% stake in the company. Jubilant IPO door seen shut for many retail clients Jubilant Foodworks’ IPO will close on Wednesday, but for many of a broker’s clients in Mumbai suburbs, the issue is as good as closed on Tuesday. The broker, which is also a mutual fund distributor, has told clients that he won’t not accept applications for this IPO in any of his branches on Wednesday. The reason cited is the logistical difficulties to carry the forms to the head office on the last day before 3 pm. Such reasoning is surprising, as many retail investors usually apply on the last day of an IPO. Stock trading over mobile may soon be a reality Sebi is said to be examining a proposal to introduce equity trading over mobile. Market buzz is that the regulator is considering certain security protocol issues connected to mobile trading and once those are resolved will kick start the facility. When introduced, mobile trading is expected to boost online trading as currently mobile penetration is a lot deeper than personal computers. Bulls lap up ICICI on hopes of strong Q3 numbers SHARES of ICICI Bank have been inching up in the past three trading sessions, defying the sluggish trend in frontline shares in general. On Tuesday, the stock held ground in a falling market, closing flat at Rs 863.40. One of the theories doing the rounds is that traders are loading up on the stock in anticipation that the third quarter numbers due on Thursday will be better than market expectations. But equity analysts feel that looks unlikely at the moment. The other talk is that some of the foreign broking firms are taking a more positive view on the stock of late and have been enthusiastically recommending it to their clients. It is not known if the recommendations have actually translated into buy orders. Contributed by Santosh Nair,Deeptha Rajkumar & Nishanth Vasudevan.

*******************************************

Tata Power

Daily Newsletters - Jan 20 2010

ENIL

GAIL

Sterlite Industries, Ultratech Cements

Jaiprakash Associates, Sintex Industries

Infotech Enterprises

Bharat Forge, Escorts

Top Picks

Indian Wireless

Src: ET, DP Blog and Valuenotes etc

Morning Calls

Wait for a breakout

The market remained tightly range-bound with only nominal movements among the major indices. The Nifty was up 0.1 per cent at 5,252.2 points while the Sensex gained even less in closing at 17,554 points. The Defty gained 0.3 per cent as the rupee strengthened further.

Volumes were on the low side but advances outnumbered declines, so breadth indicators were not bad. Both FIIs and domestic institutions were net buyers in moderate quantities. The BSE 500 rose by about 0.7 per cent while the Midcaps rose 1.85 per cent. However, the standout performer was the CNXIT index, which was up by a startling 9 per cent.

Outlook: The Nifty stayed locked in the narrow range of 5,170-5,300 and predicting direction will be impossible unless it closes outside say 5,150-5,320. A breakout should trigger a move of around 150-200 points, as and when it comes. There is previous history of very heavy trading between 5,000-5,400, so it will take volume expansion to breakout and establish a trend.

Rationale: The long-term trend is firmly up. But the intermediate trend is difficult to read and the short term trend is neutral. Volatility has been very low for several weeks. Given previous congestion at the current price levels, major volume expansion is required to trigger breakouts. Right now, volume is just not there and direction cannot be established until it occurs.

Counter-view: Low volume is associated with range-trading but also with lack of demand. Hence, one may fear a downtrend. The intermediate trend has been up since late November and is now in week seven. Intermediate trends can mature any time between 4-12 weeks. If the market does slide below 4,950, it will hit the next support at 4,800. Below 4,800, the intermediate trend would be likely to reverse, since a pattern of lower lows will be established.

Bulls & bears: The CNXIT, as mentioned above, saw strong gains. This was driven by decent results and good advisories from Infosys and TCS. All the IT majors appear in bullish mode. Tech Mahindra, Wipro and Financial Technologies could be outperformers. However, further rupee strengthening could also retard the sector's momentum.

Balancing the CNXIT, the Bank Nifty lost nearly 2 per cent and few financial sector scrips looked capable of bucking fears of higher rates or CRR hikes. On Friday, it appeared however that a few scrips like Axis Bank and Federal Bank had weathered the bearishness. The real estate sector saw mixed trading with some sell offs but Purvankara and Brigade also did well. Metals including non-ferrous metals were also weak but cement did well with ACC and Ambuja finding buyers.

PSUs did well in general with counters such as REC, Neyveli, SCI, Engineers India, BEML, Concor, NTPC, all finding support as rumours of disinvestment abounded. Winners and losers were scattered randomly outside these sectors. Tata Motors and Power Grid were among the scrips that ended strong as did Lupin and Cipla.

MICRO TECHNICALS

AMBUJA CEMENT
Current Price: Rs 113.25
Target Price: Rs 120

The stock has made an upside breakout backed by strong volumes. It has the potential to run up till around the Rs 120 mark though it will hit strong resistance above Rs 118. Keep a stop at Rs 109 and go long. Start booking profits above Rs 118.

---

FINANCIAL TECHNOLOGIES
Current Price: Rs 1,620
Target Price: N.A.

The stock is testing key resistance between Rs 1,625-1,645. If it closes above Rs 1,635, it could move till the Rs 1,750 level. Volumes are good. Keep a stop at Rs 1,600 and go long. Add to the position above Rs 1,635. Book partial profits at Rs 1,700.

---

SCI
Current Price: Rs 172.70
Target Price: Rs 185

The stock is benefiting from a focus on PSUs as well as a bounce in the shipping sector. It has risen on volume expansion. There's very little resistance until around Rs 185 and that would be a potential target. Keep a stop at Rs 167 and go long.

---

AXIS BANK
Current Price: Rs 1,078
Target Price: Rs 1,120

Axis shows signs of a breakout, which is against the trend in the banking sector. It has cleared resistance at Rs 1,055 and it could run up till somewhere between Rs 1,100-1,130. Keep a stop at Rs 1,065 and go long. Start booking profits above Rs 1,110.

---

PURVANKARA PROJECTS
Current Price: Rs 115.75
Target Price: Rs 130

The stock has jumped on volume expansion. It's testing resistance at Rs 120 and will hit that level again, on intra-day basis at least. If it closes above Rs 120, it could run till the Rs 130 level or higher. Keep a stop at Rs 110 and go long. Add to this above Rs 120 and book profits at Rs 130.

*****************************************

'Stick to bottom-up, buy on dips and hold strategy' 18-JAN-10 In the second series of interviews for Smart Portfolios, Amar Ambani talks about his expectations for 2010, reveals his strategy of sticking to mid-caps and suggests that investors look at individual stocks rather than sectors for the year.

Markets at a glance 18-JAN-10 The markets traded in a narrow range this week in spite of stellar numbers from Infosys.

Analysts' corner 18-JAN-10 The brokerage has revised earnings downwards and thus has cut the company’s 20010-12 EPS estimates by 8-11 per cent.

Premiums drop due to low volatility 18-JAN-10 The market saw practically no change in the major index levels in what is turning into an extended phase of very low volatility.

Wait for a breakout 18-JAN-10 The market remained tightly range-bound with only nominal movements among the major indices.

Alpha India updated 18-JAN-10 The January 4 yearly outlook carried numeric ranking for 50 Nifty Stocks.

Bharti: Looking out 18-JAN-10 India’s largest wireless service provider, Bharti Airtel is expanding its international operations by buying a majority stake in Bangladesh’s fourth largest wireless telephony service provider, Warid Telecom.

Bajaj: Motoring ahead 18-JAN-10 Buoyed by the demand for its Discover range of motorcycles, the country’s second largest two-wheeler maker, Bajaj Auto, posted healthy numbers for the second quarter in a row.

Green shoots are for real 18-JAN-10 Infosys Technologies’ December 2009 quarter results brought an air of optimism into the sector.

Pricey pizza 18-JAN-10 As the frequency of eating out or preference for fast food increases, players in the take-away or home-delivery space should benefit.

The PSU opportunity 18-JAN-10 Many would have reservations about investing in public sectors companies (PSUs) due to reasons such as government interference and so on.

*****************************************

Weekly Newsletter - Jan 18 2010

Weekly Newsletter - Jan 17 2010

Top 5 picks of the day I Mid-term picks





Src:ET, Business-Standard and DP Blog and etc

Stock Reports for the Week Started Jan 18

Heard on the street


HUL quarterly numbers seen below expectations

Consumer goods major HUL seems to have a new obsession, that of holding its board meeting and announcing its quarterly results on public holidays. The company has issued a communication to stock exchanges that its board meeting will be held on January 26 to consider the unaudited financial accounts for the quarter ended December 2009, along with the limited review report of the auditors for the corresponding period.

The last quarterly results were also announced on a Sunday. Market watchers are amused by this move considering that multinationals as a rule begin their weekends on Friday evening every week. This has also led to some speculation that the company’s quarterly numbers may be below market expectations.

Old Fox & gang looking for quick returns lap up Dish TV

DISH TV shares were among the notable gainers in Friday’s lacklustre session, rising nearly 7% to close at Rs 50.35. On BSE, around 90 lakh shares, thrice the two-week daily average volume in the stock, were traded on BSE, with 42% of it resulting in delivery. Dealers tracking the counter say Old Fox and gang were big buyers at the counter on Friday.

It is not clear if the Fox is in it for the long haul or is merely looking for some quick returns. While the company continues to post losses at the net level, it has shown a good growth in revenues for the half year ended September. Also, it appears that the company may end the current financial year with much lower losses compared with last year.

Contrarian play seen at bank counters ahead credit policy

WITH the indecisive movements in benchmark indices giving little opportunities to trade, smart traders are using their skills to make money in sectoral plays. They have sold stock futures of banks and capital goods, while bought that of oil and information technology. But some bravehearts within the trader community have suddenly reversed their short positions in banks, two weeks before RBI’s monetary and credit policy review.

They are going against the crowd on judgement that the undertone has been too pessimistic about the outcome of the policy review. It is widely expected that the central bank may hike cash reserve ratio, but a slight dip in bond yields this week, even as inflation rate showed a jump, has these traders go contrarian. Derivative market participants said some of these traders have created long positions in futures and options contracts in banks.

Contributed by Kala Vijayraghavan, Santosh Nair & Nishanth Vasudevan


*****************************************
HDFC Bank looks able to maintain interest margin

Jindal Saw: Maximising capacity usage to drive future nos

TCS: Fresh hiring indicates hopes of recovery soon

Inflation: Key issue in credit policy review


******************************************

Geodesic Ltd

McNally Bharat Engineering

Allahabad Bank

IPO Analysis - Jubilant Foodworks

Axis Bank

ONGC Ltd

HDFC Bank

Weekly Watch - Jan 16 2010

Oudh sugar, Engineers India Limited

Gitanjali Gems

Usha Martin

Jubilant Foodworks - Subscribe

TECHNICAL ANALYSIS: Nifty bear put spread
A better-than-expected start to the Q3 earnings season and strong IIP readings failed to enthuse traders as the markets closed the week on almost a ...

TECHNICAL ANALYSIS: Shree Renuka may move in narrow range
Suzlon (Rs 89.7): After reaching its recent high at around Rs 95, the stock has seen some weakness. Now, only a close above Rs 95 could lift the stock to Rs 110-115 levels. But if current dull trend sustains, Suzlon might head back towards ...

TECHNICAL ANALYSIS: Query Corner: Hindalco to move towards a new high
Please let me know the outlook for ABB bought at Rs 1,200 and IVRCL at Rs 484 from a medium and long-term ...


TECHNICAL ANALYSIS: Pivotals- Reliance Industries (Rs 1,109.2)
Reliance Industries witnessed wild intra-day swings last week though the ending was on an insipid note with a meagre Rs 4 gain. The near-term view for the stock stays positive but the resistance at Rs 1130 needs to be cleared before the ...

TECHNICAL ANALYSIS: Index Outlook: Roadblocks ahead
IT bellwethers, Infosys and TCS began the third quarter earnings season with a flourish, making the BSE IT index rally 9 per cent higher last week. But this optimism failed to percolate to rest of the market resulting in Sensex meandering in ...


Upside breakout seen next week




Src: ET, DP Blog , Businessline and etc