Friday, December 31, 2010
Book Profits in Long United Phosphorus Jan Future given yesterday
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Buy and Hold....
Reliance Capital (BUY, above Rs657, Target Rs680): On the hourly chart, the stock gave an upside breakout in Thursday’s trading session. It suggests that the sideways range is about to end and may reverse into an uptrend. On Monday, the stock advanced by ~1% confirming the bullish set up. We continue to remain positive on the stock from technical perspective as the stock has managed to hold on to its short-term support of 10-DMA in ongoing market volatility. Any move above the levels of Rs657 is likely to re-ignite momentum in the counter. We recommend traders with high risk appetite to buy the stock above Rs657 with SL of Rs647 for target of Rs680.
Market Commentary ..
The world is all set to say good bye to a tumultuous 2010 and welcome 2011 with fingers crossed. For the markets, it was a year of consolidation after the big recovery of the previous year. As usual, there was no dearth of events – both nasty as well as positive ones. The Indian market’s performance was clearly among the better ones and the new year is expected to be equally promising.
Today, the start appears to be a positive one following Thursday’s smart gains. Though the Nifty rollover in the F&O segment was on the lower side, one should not get unduly worried as trading was pretty muted for most part of December.
For the day, one should not have too high expectations as trading volume will be moderate. The key indices could end modestly positive but will be mostly rangebound.
The Nifty has sustained above 50 DMA and closed above 6100. The market is likely to remain positive as long as Nifty sustains above 6000. Immediate resistance is seen around 6140.
Corporate Snippets
± iGate will sign a definitive agreement to buy a controlling stake in Patni Computers. (ET)
± MOIL is in talks with Gabon’s government over acquiring possible mining concession in the central African state. (BS)
± HCL-Infosystems to acquire 20% stake in Tech Mart Telecom Distribution, a Dubai based partner of Nokia Cooperation. (BS)
± MRF is planning to sell/transfer its speciality coating division to its subsidiary. (BS)
± Hindustan Copper FPO may be at 72% discount. (ET)
± Cummins India plans to hike prices by 3-5% of its generators sets in the range of 7.5-3000KVA from 1st quarter next year. (BL)
± Strides Arcolab has struck a deal with Pfizer to sell 16 of its approved ANDAs and 6 filed ANDAs. (BS)
± Lanco Infratech has won Rs10bn road projects in Uttar Pradesh. (BS)
± Suven Lifesciences has received two product patents for its new chemical entities. (BS)
± Sales of Nano may touch around 5000 units in December. (ET)
Thursday, December 30, 2010
Book profit in HDFC given yesterday
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We reiterate buy & hold on Bata at Rs365 with SL of Rs359 for target of Rs377
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Sell Cipla (366.65) with s/L 370 target 364,362
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Market Commentary ..
After a long time we had a decent session as the bulls re-discovered their winning ways and volumes improved ahead of the F&O expiry. There could be a bit of extra volatility owing to the derivative settlement. The opening is likely to be a positive one, and the key indices could extend gains from the previous session.
The Nifty broke out of the 5970-6020 range to close above 6050. But, one needs to exercise some caution as the bulls might face resistance at higher levels.
The rangebound and light volume pattern of the last couple of weeks has been frustrating. Hopefully there will be some excitement before we bid farewell to 2010.
Oil companies will be in focus as the much-anticipated EGoM on diesel and LPG price hike has been postponed again.
± Sebi has mandated that companies with less than 25% public float will have to raise funds through a public share sale and not through private placement to institutions. (ET)
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Corporate Snippets
SAIL agrees to shell out 8% more for imported coal. (ET)
± SBI to reduce interest rates to 10-10.5% for setting up high value dairy, poultry, horticulture projects and construction of warehouses, rural godowns and cold storages. (ET)
± SBI will extend its teaser home loan scheme beyond December 31. (BS)
± NTPC is likely to get a Cabinet nod to invite tenders for a mega Rs180bn procurement of nine supercritical units. (BS)
± Mahindra & Mahindra to launch a new premium-end pick-up truck in the first half of next year. (BL)
± IOC has decided to go ahead with its massive Rs 550bn refining capacity expansion programme irrespective of the current adverse business conditions. (FE)
± Gayatri Projects has stated that its JV with Maytas Infra received an order worth Rs11.31bn. (BL)
± STC India makes Rs5.5bn claim on JSW Steel after purchase of Ispat Inds. (ET)
Wednesday, December 29, 2010
Buy and Hold....
Buy GSPL Jan Future in range of Rs116 -117 for the target price of Rs121 with a stop loss placed at Rs113.5. Lot size: 2000 Remarks: Net maximum profit of Rs10,000 and net maximum loss of Rs5,000.
Pri Market Commentary ..
Just when one was hoping that the “scam-tainted” 2010 would probably end on a happy note, comes another shocker. Citigroup has been hit by a fraud in its Gurgaon branch. It might not have a wider impact on the market sentiment but surely adds to the worries linked to the lack of governance.
As far as the market is concerned, the lackluster and rangebound pattern of December will continue. Traded volumes, which have been disappointing of late, could get some boost thanks to the F&O expiry on Thursday.
The broader market may fare a bit better than the Large Caps in the near term. But, be careful while dealing in illiquid and dodgy counters. Not too much should be made of the excruciatingly dull markets as movements are exaggerated either higher or lower. As the volatility ebbs, wide move of 100 points is expected on the breakout beyond 5970-6020.
Sell Tata motors (1268.90) with s/L 1278 tgt 1260, 1255
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Reliance Infrastructure has bagged the consultancy contract for supervisory control and data acquisition (SCADA) relating to power distribution for Patna. (BL)
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Corporate Snippets
SBI raised Rs5bn at 9.05% through three-month certificates of deposits. (BS)
± HPCL may look at merging Prize Petroleum Company Ltd with its internal exploration and production arm HP E&P. (BS)
± Lakshmi N Mittal and HPCL plan to sell a 10% stake each in the under-construction Bathinda refinery in a public offering in Q4 of 2011 to raise Rs10-15bn. (BS)
± NTPC will takeover 3,000-odd acres of vacant land from Patratu Thermal Power Station (PTPS) in Jharkhand to set up 1320 mw of thermal power generation capacity at an investment of RS66bn. (ET)
± BHEL has secured two breakthrough orders from Indian Railways for the development, manufacture and supply of 3-Phase IGBT-based propulsion systems for Electric Locomotives and AC Electric Multiple Units (EMUs). (ET)
± Punj Lloyd secured order from Hirco Group for two commercial buildings to be completed in 24 months
± Gitanjali Gems has planned a “restructured jewellery brand holding company” where it will divest 10% of equity to private equity investors, to raise US$100mn. (BS)
Tuesday, December 28, 2010
Market Commentary ..
India largely survived the China scare as did the US markets. For most part of Monday, even the Chinese markets were firm before things took an ugly turn in late trading. That had a sentimental impact on India as well as the European markets.
The start today could be a better one but the moot point is whether those early gains will stay by the close. Keep a watch on the overseas markets, particularly China after the weekend interest rate hike. With not much happening in the main indices, the broader market could hog the limelight.
The Nifty failed to sustain above 50DMA of 6023 and if it closes below 5970, the short term trend could turn negative.
Airline stocks might see some action as severe cold weather is taking a heavy toll across the Northern Hemisphere even as fog hits air and rail travel in India.
Corporate Snippets
± NTPC has commissioned the seventh unit of the Korba Super Thermal Power Station, with a capacity of 500mw in Chhattisgarh. (ET)
± iGate is set to acquire Patni Computer Systems for US$1bn, at a price of around Rs525 per share, after it reached an understanding with its promoters on the contentious issue of a non-compete provision. (ET)
± PFC and REC are hiring consultants to advise them on either setting up a bank, or buying one, to cut their cost of funds. (ET)
± Maruti Suzuki is working on a small SUV to tap other growing segments in the domestic car market. (BL)
± Power Grid Corporation has paid Rs1bn as compensation to farmers for land acquisition in past two years. (BS)
± Divestment in Hindustan Copper, which aimed to raise Rs40bn, had been deferred and might now take place either in February or after the budget. (BS)
± Bharti is looking at launching its Africa-centric DTH operations in early-to-mid 2011under the Airtel digital TV brand. (FE)
± Tata Steel UK, the British unit of India's biggest producer of the alloy, borrowed US$2.9bn to refinance loans taken to buy Corus Group Plc. (FE)
± Lanco Infratech to hive off its power business into a separate company with the aim of hitting the capital market with an initial public offer in 2012 for financing growth plans. (ET)
Monday, December 27, 2010
European markets open weak: CAC Index down 1% and DAX Index down 1.3%
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Asian markets update: Shanghai Index down 1.3% and Kospi Index flat
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TATA STEEL; trading strong hold for target
Buy Tata steel (673.35) with s/L Rs 668 target Rs 678,682
Pri Market Commentary ..
Fears of a weak start in the last trading week of the year appear to have been unfounded. The Chinese market has shrugged off the weekend rate hike after premier Wen Jiabao said his government will be able to contain inflation. Stocks in Japan too have gained. Markets in Hong Kong are shut.
We expect a steady start though things might turn a little choppy due to the F&O expiry. Trading volume could get a fillip owing to the derivative settlement but the overall activity may remain sluggish. The key indices are unlikely to budge much from the current position.
Real action is expected only in January when markets will digest latest quarterly results, along with fresh economic statistics. The RBI’s quarterly review will also be an important event in the face of the fresh upturn in inflation.
Global markets will continue to see muted action to the year-end factor. Individual stocks will continue see some action based on the news flow. The Nifty failed to surpass 50 DMA. Therefore, the sentiment remains cautious. We expect the Nifty to be in a range of 5850-6080.
Corporate Snippets
± Allahabad Bank has sought infusion of Rs 10bn from the government; bank is also planning to raise Rs14bn Tier-II bonds before the close of this fiscal. (BL)
± International Coal Ventures, an SPV formed by Steel Ministry to acquire coal assets abroad, and including SAIL, Coal India, NTPC, NMDC and Rashtriya Ispat Nigam, has a month's time to bid higher than US$3.9bn for Riversdale Mining. (BL)
± Welspun Infra Projects, a closely held entity of the Welspun Group, says it would acquire 35% stake in Leighton Contractors India, the Indian operations of Australian infrastructure major Leighton International, for Rs4.7bn. (BS)
± Coal India to start work in 2 Mozambique blocks next fiscal. (BL)
± GMR Infrastructure arm GMR SEZ & Port Holdings has entered into a share subscription agreement to subscribe to 51% in Kakinada SEZ. (BS)
± Tata Steel has decided to raise long-term funds of up to US$1bn by a way of share sale through the Differential Voting Rights route. (BS)
± Gujarat State Petroleum Corp. has struck a gas reserve in an on land exploration block at Ankleshwar in the state. (ET)
± Titan Industries plans to add around 108 outlets in its key verticals of jewellery, watches and eye-gear to reach a total strength of 700 by end the of this financial year. (BS)
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