HDIL board allots bonus equity shares

The board of directors of Housing Development (Q, N,C,F)* & Infrastructure (HDIL) through its finance committee meeting has made the allotment of 61,220,595 equity shares as bonus to the shareholders who are registered as members as on record date i.e. Aug. 22, 2008.

The company is in the process of crediting the shares to the shareholders and it will be credited within two weeks time.

Housing Development and Infrastructure is a Mumbai-based company primarily engaged in the development of residential, commercial, retail properties and is also involved in the slum rehabilitation scheme.

Shares of the company declined Rs 4.3, or 1.44%, to trade at Rs 294.9. The total volume of shares traded was 252,649 at the BSE (11.31 a.m., Wednesday).

Cement shares buck weak market

The market remained subdued in early afternoon trade as rising crude oil prices weighed on the sentiments. The BSE 30-share Sensex was down 51.11 points. Index heavyweight Reliance Industries staged a comeback from day’s low. The market breadth was negative. Global cues were mixed.

As per reports, marketwide rollover of positions from August 2008 series to September 2008 series stood at 62% while that of Nifty was at 56%, as of Wednesday, 26 August 2008. The rollovers are in line with those in previous series. August 2008 derivatives contracts expire today, 28 August 2008.

Inflation based on the wholesale price index is forecast to have risen to a fresh 16-year high for the year through 16 August 2008. The government will release the inflation data after market hours today, 28 August 2008.

On the New York Mercantile Exchange, October 2008 crude rose $1.88 at $118.15 per barrel, yesterday, 27 August 2008 on fears that Tropical Storm Gustav could interrupt oil and natural gas output in the Gulf of Mexico.

At 12:25 IST, the BSE 30-share Sensex was down 51.11 points or 0.36% to 14,245.41. Sensex gained 50.40 points at day’s high of 14,347.19 hit in early trade. At the day’s low of 14,221.83 struck in mid-morning trade, the Sensex lost 74.96 points.

The S&P CNX Nifty slipped 9.30 points or 0.22% to 4,282.80

The market breadth was negative on BSE with 1302 shares declining as compared to 953 that advanced. 111 remained unchanged.

The BSE Mid-Cap indices fell 0.26% to 5,671.89 and the BSE Small-Cap index lost 0.33% to 6,836.97

The total turnover on BSE amounted to Rs 1391 crore at 12:30 IST as compared to Rs 976 crore by 11:30 IST.

Among the 30-member Sensex pack, 17 declined while the rest advanced.

India's largest private sector aluminium maker by sales Hindalco Industries was trading at Rs 124.30. The stock started trading on an ex-rights basis today. The right issue is in the ratio of 3:7, priced at Rs 96 each.

Cement shares rose on fresh buying. North India’s largest cement maker by sales ACC rose 1.27% to Rs 565.60. It was the top gainer from Sensex pack.

Ambuja Cement (up 1.40% to Rs 81), UltraTech Cement Company (up 0.68% to Rs 598.65), and India Cement (up 1.14% to Rs 141.75), gained. As per a recent foreign brokerage report, cement prices are set to decline 15-20% by fiscal 2009-10 due to increase in increase in cement supplies.

L&T okays bonus issue, declares dividend

MUMBAI: Engineering and construction major Larsen & Toubro on Friday said it would issue one bonus share for every one equity share held by the existing shareholders.

The shareholders took a decision to this effect at the 63rd annual general meeting, L&T said in a regulatory filing to the Bombay Stock Exchange.

The stakeholders gave their final permission for bonus issue in the proportion of one equity share for every one equity share held by the existing shareholders, it said.

The company has also declared the dividend at Rs 15 per share, having a face value Rs 2 each, L&T added.

The company has fixed October 3 as record date for issuing of bonus shares, it said.

Technical Buy Call: GUJARAT ALKALI - Rs 185.40

Technical Buy Call: GUJARAT ALKALI - Rs 185.40
1st Target: Rs 218 (4-6 weeks) 2nd Target: 227 (12-14 weeks) Stoploss: Rs 169

Gujarat Alkali peaked to an intra-week high of Rs 243.75 in the week ended May 5, 2006, and then reversed the next few week, struggled a bit at 244 level before declining to post an intra-week low of Rs 125.25 in the week ended June 9, 2006. It next fell to an intra-week low of Rs 107.10 in the week ended March 9, 2007. From there it staged a recovery, almost took support on the 21-week EMA, and posted a series of progressively higher tops and bottoms. It peaked at an intra-week high of Rs 275.00 week ended January 4, 2007 and agains entered a corrective phase. Gujarat Alkali couldn’t sustain these levels for long, declined to post an intra-week low of Rs 120 in the week ended January 25, 2008. The recovered touched a high of Rs 203 in the week ended April 17, 2008. It fell again and almost gave a downward breakout from its upward sloping trendline. There is a possibility of upside from the 200 level.

Indian Bank - Possible Upward Move in Coming Days

The recent announcement by Indian Bank on hike in Benchmark Prime Lending Rates (BPLR) by 75 bps, from the existing 13.25 per cent per annum to 14 per cent per annum, will be helpful for the banks’ core business in lieu of the interest rate hike. The bank has emabrked on a rapid explansion and already opened new branches in the Bangalore circle. With its growth plan, it has attracted investors’ attention in the last few trading sessions. The counter is expected move upwards in the coming days. Taking into account the positives associated with this counter, you may add the scrip to your portfolio for quick gains.

Dalal Street Hot Chips: HDIL - 15-20% Gain Possible in Short Term

Anticipating a lower inflation after the all-time high in the last few weeks, interest rates are supposed to be stable for the time being. It could boost the potential for price appreciation in the banking stock as well as realty sector. As banking and realty, counters have highest correlation among them. HDIL being one of the major players in the realty market seems to be attractive at this price level. According some market sources, the scrip can have further potential for price appreciation of 15-20 percent in a short-term period. Therefore, investors with short-term interest can think of taking an exposure in the counter.

GMR Infra Becoming a “global airport company”

The “airport” company of India is making big news once again, in the international arena. GMR Infra which was successful in winning the bid for building Turkey’s airport is now expanding its horizons far and wide. Russia, which is privatizing its airports, has invited bids for modernizing the third largest airport in Russia – the Pulkovo airport. GMR Infra has been identified as an eligible bidder and the second round of bidding is scheduled to open soon. It is currently in the process of doing a due diligence and if it finds the project viable, it is expected to take the final call soon.

If GMR Infra manages to win this bid, it will open a big door of opportunity. This airport is based in St.Petersburg and reportedly, one of the biggest aviation enterprises in Russia. As per the plans, it is to have two terminals, Pulkovo-1 and Pulkovo-2. This will be a great opportunity for GMR to showcase its abilities. And if GMR wins this bid, it will mean that other European countries which are also in the process of initiating their airport modernizations, will look at GMR as one of the best options available. The winning of this bid for the Russian airport would make GMR known globally as the “Indian airport company”! Fingers crossed!

Technical Buy Call: Bata India - Rs. 167.85

Technical Buy Call: Bata India - Rs. 167.85
1st Target: Rs 192 (4-6 weeks) 2nd Target: Rs 201 (12 -14 weeks) Stoploss: Rs 156

Bata India bottomed out by posting an intra-week low of Rs 096.00 during the week ended August 5, 2005, and these levels have not been seen since. The scrip struggled a bit but finally overcame and took support on the 21-week EMA, launched into an intermediate uptrend, posted a series of progressively higher tops and bottoms and rallied to peak at an intraweek high of Rs 166 during the week ended September 23, 2005. Bata India couldn’t sustain these levels and entered a corrective phase, psoting Rs 133.50 during the week ended October 14, 2005. The scrip commenced its uptrend from here, rebounded and again launched into an intermediate uptrendand reached the peak at an intra-week high of Rs 329.25 in the week ended May 12, 2006. The next corrective phase took long time and the scrip rallied to a peak at an intra-week high of Rs 296 in the week ended January 4, 2008. Currently, Bata India seems set to move up after a correction. The mechanical indicators are supporting the move and the daily picture is looking better. An upside lies ahead.

Air Deccan plans to set up India’s largest hotel chain

After changing the shape of India's aviation business, Captain GR Gopinath is all set to spearhead a new venture in hospitality.

The man behind India's budget airline is now looking to give the country its largest hotel chain. Sources say that GR Gopinath, former promoter of Air Deccan, has tied up with an investment banker from the US to set up a chain of 1,000 hotels across 100 towns and cities over the next 10 years. The hotels are expected to be in the mid-tier and budget categories. And depending on the location, they will have between 50 and 125 rooms. That's an average investment of Rs 50 crore on each property.

The company is said to be in talks with PE players as well as institutional investors as a majority of the funds will need to be raised externally. Due to the large investment involved, promoters are said to be looking at a split business model. While they will own and operate a large number of hotels, many will also be marketed under the franchise route.

The projects are expected to go on stream by the end of the year. The company, Deccan Hospitality, is expected to make a formal announcement next month. Though the brand name for the hotel chain is yet to be finalized, Gopinath and his team are currently on a hiring spree for talent to head the business from overseas.

RPower in cash chase to fund projects

Reliance Power Ltd (RPower) is planning to raise nearly Rs 9,000 crore in what could be the country’s largest rupee-denominated loan this year to fund the Sasan and Krishnapatnam mega power projects.

The Anil Dhirubhai Ambani company, which is currently creating 28,200MW generation capacity, said the first unit of the Sasan project would be commissioned in December 2011 and the entire project was expected to be commissioned by March 2013.

For the 3,960MW Sasan project, the company has already awarded the engineering, procurement and construction contract to Reliance Infrastructure Ltd.

RPower has received the Reserve Bank of India’s approval to raise $2 billion (Rs 8,500 crore) each in external commercial borrowings (ECBs) for both the Sasan and Krishnapatnam projects.

Sources here indicated that the rupee-denominated loan would form part of this fund-raising programme and the ECBs could be accordingly modified.

RPower has engaged the investment banking subsidiary of a state-owned bank to raise funds for the project. The loan, which will have a 15-year tenure, could be secured in a couple of months.

The company is also in negotiations with a few foreign banks to raise funds for the projects, sources said.

RPower, which came out with an initial public offering early this year, saw a fantastic response as it received subscriptions of over $100 billion from foreign investors. The company had mobilised nearly Rs 11,563 crore from the IPO.

There were 50 lakh retail applications in response to the IPO, making it one of the biggest in the world.

While the company fixed an issue price of Rs 450 per share, the issue had a dismal opening when it was finally listed on the bourses.

The company was forced to issue bonus shares to investors to compensate them for the losses they had suffered because of the fall in the stock price.

The RPower stock closed at Rs 166.95 on the Bombay Stock Exchange today.

ACC top execs get Holcim shares

Shares of Swiss cement maker Holcim is now part of the remuneration of the senior managers of ACC. This is intended to increase the alignment between the world’s second-largest and India’s largest cement firm.

As many as 55 of ACC top managers have started receiving Holcim stock this year. Under the scheme in force, a part of the annual performance bonus of eligible ACC managers gets converted into the Holcim stock at a fixed rate, which is at a discount from the ruling market price of the stock. These shares come with a lock-in period. ACC CEO Sumit Banerjee confirmed the development.

A cement analyst said the Holcim stock is seen to be a better option by ACC managers than shares of their own company. “It may be perceived as a good gesture by Holcim that it cares for ACC executives. Plus, the stock option allows ACC managers to benefit from the good work done by their colleagues in other Holcim outfits across the globe. This is a nice feeling,” he added. ACC had scrapped its own employees stock option plan (Esop) in 2005.

The fundamental idea is to align the interests of senior ACC employees with that of the company’s largest shareholder. “ACC executives need to get used to the idea that they are working to improve Holcim’s valuation,” said a person familiar with the situation. According to another analyst, the alignment with Indian operations is critical for Holcim. “Holcim earns nearly 17-18% of its global topline in India. So, its only natural that it would attach importance on further consolidating the alignment with Indian outfits,” he added.

There is as yet no such programme at its other Indian outfit — Ambuja Cement. However, experts said a similar stock option may be launched at Ambuja Cement as well. For the record, Holcim controls a fourth of Indian market with an annual production capacity of 39 million tonne.

End of an era

The GCC's reputation as a brand drug stronghold is coming to an end. MT explores how the rise of generics is proving a success story for the subcontinent.

Start with a pharmaceutical market built almost entirely on imports. Add in a society weighted by chronic diseases, seeking every way to clamp down on healthcare costs.

Factor in the number of brand name drugs set to lose patent protection over the next few years. What you end up with is a prediction that over the next five years, generic drug manufacturers will dominate the GCC's pharmaceutical industry. And the biggest players, say experts, are likely to be Indian.

Is Gold Cheap or Oil Expensive?

Crude Oil Prices have corrected from the highs near the $150 per barrel levels to near the $120 levels. Is the correction over or is there more good news to come in terms of lower crude oil prices? No one will have a definitive answer.

The Gold / Oil ratio remains near its all time lows which suggests that gold is seriously undervalued. Gold / Oil ratio refers to how much crude oil can be bought with one ounce of Gold. With gold at $930 per ounce and oil at $125 per barrel, the Gold/Oil ratio is at 7.4. The average for the last 40 years has been around 15. But does this mean gold prices are too low, or perhaps that crude oil prices are unsustainable at current levels and have to come down sharply and quickly. Your viewpoint depends on which side of the fence you are sitting on.

Gold Oil Ratio

Source: Bloomberg

If one were to take a pragmatic view, it seems likely that the future scenario could be something in between the two viewpoints. Given the no. of factors influencing crude prices one can’t be really sure of the trend of crude oil prices in the future. However one can be reasonably sure that the long term relationship of Gold to Crude oil will revert back to its historical average of around 1: 14.5 versus 1: 7.4 currently. This can happen either by a big fall in crude oil prices or gold prices moving up much higher.

There is a lot of uncertainty over which way gold prices will move in the short term. . However a no. of international and domestic gold traders and analysts are bullish on Gold and have been predicting that gold would soon start moving northwards and some have predicted that it will reach $2000 per ounce in the medium term.. Many Commodity Experts and Analysts also believe that Crude Oil prices are unlikely to slide below $ 100 per barrel mark.

If Crude Oil Prices fall further what will happen to gold prices? Recently Crude Oil Prices came down from higher levels and Gold Prices also came down. Therefore a correction in Crude Oil prices led to a correction in Gold prices.

International crude oil prices increased by more than 47% this year when it reached its all time high of around $145 whereas international gold prices went up by only 14% during the same time frame. This shows that record crude oil prices were not followed by record gold prices.

We believe that the gold / oil ratio will align with the long term average i.e 14.5. Even if crude oil prices correct to $100 levels which experts say could be the new floor price, then gold has to rise to $1450 to get back to its historical average. There are various forecasts of crude boiling to $150 levels and above. In such ascenario, to adjust to the historical average, gold prices will have to rise above $2100.

Gold / Oil Ratio
Long Term Average	14.51
Current Crude Price ($/barrel)	125
Corresponding Gold Price adjusted to the long term ratio	1814
Scenario Analysis
Crude Prices($ / barrel)	Gold Prices Adjusted to Long term Gold / Oil Ratio ($ / troy ounce)
65	943
80	1161
90	1306
100	1451
120	1741
140	2031
150	2177
180	2612
200	2902

* The Table above is purely illustrative and indicates potential gold prices assuming gold / oil ratio at 14.5. Actual Gold / Oil ratio may be higher or lower than 14.5.Past performance may or may not be sustained in future.

This recent correction has indeed provided long term investors an opportunity to buy / add more gold to their portfolio. Do not miss the bus this time, buy gold now.

Buy Gold... Buy Gold ETF. Now!

India's Yes Bank Q1 net profit 543.3 mln rupees

India-based Yes Bank Ltd. reported first quarter to June net profit rose to 543.3 million rupees from 360 million a year earlier, and total income rose to 4.86 billion rupees from 3.48 billion.

At 1:29 p.m. local time Yes Bank shares were up 2.40 percent at 130.15 rupees, while the benchmark Sensex was down 0.40 percent at 14,230.62 points.

Details on Index futures & options

Index futures are future contracts where the underlying asset is the stock market index. The stock index is a number that helps you measure the levels of the market. Most stock indices attempt to be proxies for the market they exist in. These are suited to investors who want to take a position on market movements. For example, in case an investor believes that the markets are bullish and the Sensex would cross 6,000 points, instead of buying shares that constitute the index, he can take a position on the index future.

An index is a representative of the stock market. By tracking the changes of the BSE Sensex, one can gauge market sentiments. The BSE Sensex is a weighted average of prices of few select stocks, where the weight is the market capitalisation of individual stocks. Market capitalisation is the product of stock price and number of shares issued by the company.

Futures are all contracts covering the sale of financial instruments for future delivery on any exchange. There is an agreement to buy or sell a specified quantity of financial instruments in a designated future month at a price agreed upon by the buyer and seller. The contracts themselves may also be traded on the futures market. This is a market in which contracts for future delivery of a commodity or a share are bought or sold.

For example, if one buys 1,000 futures at Rs 50 for December 31 delivery, it means that on December 31, he would pay the seller Rs 50,000 and get in return 1,000 shares. There won't be any physical delivery of the underlying asset. The settlement is done by paying or receiving the difference in the actual price on December 31 and the contracted price. In case the price of the share was Rs 75 on December 31, the investor would get Rs 25,000 (1,000 shares multiplied by Rs 75 minus Rs 50).

Index futures are useful for taking positions in the market. They also serve as good hedging instruments. For example, if an investor thinks that a company is undervalued, he may take a long position on its stock. In case the market declines, he can hedge the long position by selling the index futures. This would offset the intrinsic market exposure on the long position on the company.

Indices differ based on the method of assigning the weightages to the stocks in the portfolio. Returns on the index are supposed to represent returns on the market, i.e., the returns that you could get if you had the entire market in your portfolio. Broad-based index is geared to provide overall picture of stock markets movements. Specialised indices like sector-specific ones, track the performance of individual sectors. Different types of indices can be created depending on the companies included in the set.

Stock prices are impacted by many factors including company-specific events like results, dividends, bonus announcements, product launches etc, and also by the events that impact the economy or sector. The role of an effective index is to reflect only that component which affects the state of the overall market. They act as an effective barometer, which gauges the prevalent market sentiment and behaviour. The index value is arrived at by calculating the weighted average of the prices of a basket of stocks of a particular portfolio. This portfolio is called the index portfolio and attempts a high degree of correlation with the market.

Tata Infrastructure Fund for long-term

I have been mentioning Tata Infrastructure Fund as one of my choices for long-term investment purposes over the last few weeks. I still feel that given the long-term investment scenario, this fund would yield good returns. But my advice would be to split your investment in two-three funds, so that the risk associated with investment in mutual funds gets spread over a broader category. Apart from this fund, you may also choose to invest in DSPML T.I.G.E.R fund and HDFC Top 200 fund.

NMDC gets nod to mine limestone

India's public sector National Mineral Development Corporation (NMDC) has got permission to mine steel-grade limestone in Himachal Pradesh, a state government official said Wednesday.
The firm will invest over Rs.5 billion for the project.
The state government has given the green light to NMDC to extract limestone in the Arki region of Solan district, S.C. Negi, principal secretary of the state government's industry department, told IANS.
This will be one of the biggest mining projects in the state with an investment of more than Rs.5 billion.The state government will get an annual royalty of Rs.110 million and NMDC will generate direct and indirect employment for more than 5,000 people.
NMDC has already reached an agreement with cement maker Gujarat Ambuja Cements Ltd (GACL) to supply limestone to its cement plant at Suli village near Darlaghat in Solan district of Himachal Pradesh.

The limestone will be transported from the quarries to the GACL plant through a 10-km-long overhead ropeway. For this, NMDC has agreed to install the necessary equipment.

The public sector minerals company is also looking for other buyers, especially steel plants, as the limestone to be extracted is also a vital raw material for making steel

Buy punjlloyd below 250 for very long term holding....

Buy punjlloyd at 225-250

Sharekhan has given 18 months target of Punj Lloyd Rs. 532.

Punj Lloyd Limited has informed the Exchange that all the resolutions contained in the Notice convening Annual General Meeting have been duly passed by shareholders in their meeting held on July 28, 2008. The resolutions approved by shareholders include inter-alia the following: 1) Declaration of dividend @Re. 0.40 per share for the year ended March 31, 2008; 2) Re-appointment of Mr. Atul Punj as executive Chairman of the Company for a period of five years. Further, the Company has submitted to the Exchange a copy of the Notice of Annual General Meeting.

IFCI may not fall below 35 again

According to few fundamentalists who track the scrip closely,Ifci may not fall below 35 again.... so the downward risk is 20% only from present price.... upward appreciation is unlimited.... risk reward ratio is in favour of investors....

Deliveries are nearly above 200 percent . Yes 200 percent. Rollover about 40%. Yesterdat it has kissed the bottom of 41.50 and did a pull back. With all the positive global cues and one day before expiry IFCI may surge to 45.20 at the opening of the market. Appears next month fire works

IFCI is naughty stock... many a time it hood winks and does a contrarian move. It has generated buy signals on some of the charts with moderate volumes. On the last day of the expiry it has all things going well for good upmove. But it is moody !!

All things done and said. Unless the current management takes some positive action quickly they will be killing a potentially very good company. Hope they act proactively in shareholders interest. And also lets give importance not only to the technicals and fundamentals but also concentrate on liquidity in the market.

Suzlon starting a shipping division

Tulsi Tanti, Chairman, Suzlon said that the company has bagged a 106.5 MW order from DLF. He informed CNBC-TV18 that the company’s order book stands at 3040 MW and is worth Rs 16,491 crore. The company has raised its pricing by 3-4%.
Suzlon is starting a shipping division in Singapore. To head the shipping company they have recruited Mr. Bansal a young twit who has ruined a very successful shipping through unpleasant ways. He has been involved in many issues and like old habits die hard this will certainly continue in this new venture. To make matters worse he has recruited more of his so called chamchas from there so he can be surrounded by his soldiers so he can do the same as what he did before with their help. I believe the company

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