Keynes economist or a Investor

Keynes economist or a Investor

Which is the best investment method?

There are many method of investment Fundamental, Technical, insider news, investing using economical cycles, investment based on greed and fear( investing when Sensex was below10,000 after 50% correction from peak), investment based on dividend yield, investing based on bottoming of industry cycle(Hotel & Textile in worst phase now) and even being a contrarian investor  George Soros has excelled.

So it is not in one method of investing the best investors have used multiple combination legendary investor Warren Buffet even waited for years to invest in panic of 2008-09 so he waited for fear in market to invest with greed.

History says John Maynard Keynes British economist as one of the best speculator and investor who lived during Great Depression and World War I & II.

After Sub-Prime crisis the global economy is following Keynesian economics among various policy makers from the world's industrialized economies. This included discussion and implementation of economic policies in accordance with the recommendations made by John Maynard Keynes in response to the Great Depression—such as fiscal stimulus and expansionary monetary policy.

http://en.wikipedia.org/wiki/2008%E2%80%932009_Keynesian_resurgence

John Maynard Keynes,  (5 June 1883 – 21 April 1946) was a British economist whose ideas have been a central influence on modern macroeconomics, both in theory and practice. He advocated interventionist government policy, by which governments would use fiscal and monetary measures to mitigate the adverse effects of business cycles, economic recessions, and depressions. His ideas are the basis for the school of thought known as Keynesian economics, and its various offshoots.

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

Keynes economist or a Investor

Keynes was an economist; he was an investor; he was a patron of the arts and a lover of ballet. He was a speculator. He was also confidant of prime ministers. He had a civil service career. So he lived a very full life in all those ways.” Keynes speculated with his personal account, invested on behalf of various investment and insurance trusts and even ran a college endowment, each of which had different goals, time horizons, and product mandates.

Upon his death, he left a substantial personal fortune primarily a result of his financial market activities. Evidence of Keynes’ investing acumen can be found in the returns of the King’s College Cambridge endowment, the College Chest, for which he had total discretion as the First Bursar. A publicly available track record shows he returned an average of 13.2% per annum from 1928 to 1945, a time when the broad UK equity index lost an average of 0.5% per annum.

This was quite a feat considering the 1929 stock market crash, the Great Depression, and World War II occurred over that time frame. But, like all great investors, Keynes first had to learn some difficult lessons. He was not immune to blowups in spite of his superior intellect and understanding of global markets. In the early 1900s, he successfully speculated in global currencies on margin before switching to the commodity markets. Then, during the commodity slump of 1929, his personal account was completely wiped out by a margin call. After the 1929 setback, his greatest successes came from investing globally in equities but he continued to speculate in bonds and commodities.

His investment philosophy . . . changed in line with his evolving economic theories. He learned a lot of his theory from his experience as an investor and this theory in turn modified his practice as an investor.”

Sample Report last day today

Market Outlook: Market to open negative on Global cues and weak Commodity prices where Crude and Copper has seen big correction would pressure Metal and Oil & Gas sector, Nifty opening below yesterday low with a Gap-down then selling pressure to be more as possible Island reversal would force traders to square trade as Monday 28th would be holiday for Indian markets making this week also longer weekend. Derivative settlement ended with Nifty futures was 70 % and Market wide rollover 84%, Overall position Rs.78, 218crs. Today is 136th day from low of 6th March 2009 and 221 days from 27th October 2008 low and 144 & 233 are important Fibonacci number where turn date can be possible with error and caution is advised and any correction from here can be deeper and for correction or rally no reason can be assigned. Real weakness in Nifty would be below 4700 on continuous 2-3days closing basis only, INFOSYS result starts on 9October which has normally been trend setter. Logistics sector is expected to clock Rs 5, 96,114 crore in annual revenues by 2013-14 on the back of strong growth in economic fundamentals as well as favorable regulatory environment, said CRISIL in report. IGL/GDL/DHANBANK/SKUMAR/KALINDEE and TATACOMM are 6 stocks which I would suggest as investment for next 2years only for investors use correction to accumulate.



Caution: Whenever caution is advised many feel this is time to short market and lose money, there is still no weakness in stock market. One should understand short selling needs lot of understanding and training in market just because a stock or Index is overvalued one shouldn’t go short as “Warren Buffet has said The market can remain irrational longer than you can remain solvent"” one should sell only in weakness where lower tops and bottoms are made or trading below short term or long term moving average happens. Mistake which happens is Majority short sell highs 52week or all time high and what moves higher moves higher so please avoid such mistake. Hedging is different as you are already invested and you are protecting your investment against unforeseen event as any major correction across the globe has happened due unforeseen event only.
http://economictimes.indiatimes.com/News/News-By-Industry/Banking/-Finance-/Dhanalakshmi-to-enter-asset-management-business/articleshow/4979796.cms

Download Sample Market Morning Newsletter which will be sent in paid service - http://www.4shared.com/file/135242159/8017581/Market_Morning_25_Sep2009.html

Sample Report of Market Outlook- 24 Sep 2009

Market Outlook: Market to open weak on global cues but derivative settlement will have its own way to determine the market move today with market wide rollover @59% and Nifty rollover @ 53%. Option writers have squared up puts with PCR-1.68 from previous day of 1.77 could keep pressure on Nifty if it stays below 5000 levels today. Nifty below 4930 caution is advised and we go towards settlement with high Open interest of Rs.119003crs, last time such a high open interest figure was recorded was in December 2007 when the four-year old bull market was at its peak. SUZLON, JPASSOCIATE, 3IINFO and CIPLA raised up Rs 3000cr in a single day through stake sale, QIP and treasury share sale which kept pressure on these stocks. Many Indian companies are raising capital and many more lined up with FIIs and MF figure show positive which include stake sale and no fresh money for secondary market so we find more declining stock starting this month on overall basis. S&P has revised India International outlook to positive from stable and affirmed the counterparty credit and financial strength ratings. The World Bank approved $4.3 billion in loans for India to help finance infrastructure building and to shore up the capital of some state banks, benefited Mid-cap Banking stocks like IOB, VIJAYABANK, UCOBANK, ANDHRABANK, SYNDIBANK and DENABANK saw buying interest.  
 
Rally prompts promoters to sell treasury stock   http://www.business-standard.com/india/news/rally-prompts-promoters-to-sell-treasury-stock/371046/  
 
Promoters in Stake Sale Mode as Indices hit new yearly highs
Last week RELIANCE raised Rs 3188 Cr from treasury stock sale and yesterday SUZLON, JPASSO and CIPLA sold a combined $531million of stock (nearly Rs 3000 Cr); it seems even promoters are taking advantage on the best rally in Indian stocks since 1991 so why can’t a retail investor? Nifty P/E at 22.61 tells us the best is already seen and most of the good news is built in. And as times are good, all are trying to make hay while sun shines. We have seen a flurry of QIPs and now IPOs have also started, one more RELIANCE group IPO is coming up - RELIANCE INFRATEL. http://tanmaygopal.blogspot.com/2009/09/promoters-in-stake-sale-mode-as-indices.html

Nifty (4969) Support-4932/4890/4844 Resistance 5010/5049/5118 VIX-26.51 Nifty till 4930 support holds bounce back can be possible and 5010 would become important resistance on higher side. Derivative settlement so any sustainable move below 4930 panic can be higher and even 4840 can become a possibility.

GAIL has signed two contracts for sourcing natural gas from PY-1 field for supply to a power plant in Tamil Nadu. The company also entered into a contract in downstream for the supply of PY-1 gas with PPN Power Generating Company in Tamil Nadu. The GSC between Gail and HOEC provides for a primary term of 15 years, which can be extended on mutually, agreed terms. For the first six years, gas supplies are expected in the range of 51,000 mmbtu per day. Gail is also entitled to receive additional gas, if any, from the field as per the terms of the contract.
 
A former analyst with Moody's Corp has accused the credit ratings agency of issuing inflated ratings, and has taken his concerns to U.S. congressional investigators, the Wall Street Journal reported on Wednesday. In a letter dated July, obtained by the paper, Eric Kolchinsky accused Moody's Investor Service of issuing a high rating to a complicated debt security in January, in spite of it being aware it was planning to downgrade assets backing the securities. 

Indian monsoon is about 20% below strength just over a week before the end of the rainy reason, putting the country on course for its worst drought since 1972, weather data showed.
 
The World Bank on Tuesday approved $4.3 billion in loans for India to help finance infrastructure building and to shore up the capital of some state banks as the economy recovers from the global financial crisis.
 
S&P Revises India International outlook To Positive; Affirms rating
-- We expect India International's competitive position to continue to improve.
-- A strong underwriting performance and capitalization underpin the company's financial profile.
-- We revised the rating outlook to positive from stable and affirmed the counterparty credit and financial strength ratings.
 
TCS has received a five-year contract from the government of India's Andhra Pradesh state for a statewide technology network project to enable e-governance initiatives.
 
U.S. stocks turn lower as oil drops below $69 after report show surprise gains in crude oil supplies and builds in gasoline inventories. Investors also await the outcome of the Federal Reserve's latest deliberations on interest rates.
 
RANBAXY -on continued hopes there could soon be resolution to issues regarding its manufacturing unit in Dewas, after U.S. FDA had earlier banned products from two of its manufacturing plants. "There were some media reports that Ranbaxy had invited the U.S. FDA to re-inspect its facilities at Dewas raising hopes of an early resolution to its ongoing regulatory issues with the American drug regulator," says local analyst, who says that fundamentally there is no reason for further upside in stock. Note, stock has risen nearly 17% in past seven sessions. Last September, FDA warned Ranbaxy for not adhering to U.S. manufacturing standards at its plants in Dewas and Paonta Sahib from which drugs were made and exported to the U.S. It also banned 30 drugs made by the company at these two plants and halted approval of new drug applications.
 
PREVIEW: India WPI likely to rise 0.29% on year in week to September 12 vs 0.12% increase previous week, indicates Dow Jones poll of 5 economists. "Going forward, rising prices of food articles and electricity generation are going to create adverse cost conditions for the manufacturing sector also," says economist at state-run bank; RBI may have to reverse its easy monetary stance earlier than most other countries as inflationary pressures are mounting quickly, Governor Subbarao said recently.
 
Crude-oil futures extended losses Wednesday after the Energy Information Administration reported increases in U.S. petroleum inventories last week as gasoline demand dropped to the lowest level in nearly eight months.
 

• Suzlon Energy, have offloaded seven crore shares of their holding representing 4.5% of total stake in the company, for about Rs 700 crore, Post the sale, total promoter group shareholding in the company has come down to about 53.08%.
• Jaiprakash Associates has sold 4 crore treasury shares at Rs 238.50 and managed to raise Rs 954 crore.
• Crude oil production in August at 2.77 million tonnes was lower than 2.84 million tonnes, according to data released by Petroleum Ministry here.
• UB will be world's No 1 spirits company next fiscal: Mallya; "This (fiscal) we will be selling 102 million cases of nine litres each. Next year we will be the single largest spirits company in the world," he said

Sample Morning Report

From 28/09/2009 new format stock specific report will start

Market Outlook: Market to open positive and with just 2days for derivative settlement this would be hard to understand the move of the market with Derivative highly excess with PCR-1.77 Overall market Open Interest Rs.121407crs and with both Index near all time high Short squeeze is happening which is evident in Rollover statistics where Nifty rollover is 36% compared with 54%. Majority have been holding bearish or cautious view and when majority want a correction it may be delayed or may not happen, instead market can consolidate with sector specific correction may happen, we did mention about TELECOM sector looking weak and now CEMENT  Sector had started to show weakness and CMIE in its report has said Cement prices are expected to weaken across cities in the second half of 2009-10. Cement prices are expected to weaken in second half of 2009-10 because huge 35 million tonnes of fresh cement capacity will come on-stream, which will put pressure on the realizations of companies. Asian Development Bank has raised its growth forecast for India to 6% in the current fiscal year from its earlier projection of 5%, but cautioned against the government’s ballooning fiscal deficit. India's corporate advance tax in the September quarter is expected to rise 14.7% to 440.10 billion rupees ($9.14 billion), a finance ministry official said which has come lower than previous figure of 18%.

Nifty (5020) Support-4978/4934/4890 Resistance 5055/5118/5170 VIX-26.80                   Nifty range 4960-5055 Nifty failing to move above 5055 intraday correction can be possible. Target of the week can be 5170 if 4930 is not broken on downside.                                         

Caution advised: Market for the past 4-6weeks has not seen an overall participation and it has been selective Auto, Tech, Banks and Metals stocks which has been holding the index and making 16months high. This can be a smart consolidation or distribution so investors are advised to improve cash level as timing correction is hard. And going by derivative if Shorts are squeezed then market would lack support in case correction happens in next few months and there can be a possibility of correction of higher degree 30-40% in my view.

 

• SEBI tightened its takeover regulations, a move which analysts say could be a blow to Bharti Airtel Ltd.'songoing merger talks with South Africa's MTN Group Ltd.
• Axis Bank fixed the price of its GDR offering at $18.90 (INR906.70) a share; has also fixed the price of its institutional share sale and preferential issue to promoters at INR906.70 a share, it said in a note to the BSE
• TCS said Tata Sons Ltd. on Sept. 11 revoked 10.58 million shares of the company that were pledged with financial institutions.
• U.K.-based financial-services company Standard Chartered PLC is expected to file paperwork with Indian securities regulators as soon as this week to become the first foreign company to list its shares on an Indian stock exchange.
• Polaris Software Lab is planning to expand its European operations beyond continental Europe and is considering joint venture alliances to achieve this.
• Reliance Communications plans to file a draft prospectus "shortly" for the initial public sale of shares in its telecom-tower unit, Reliance Infratel Ltd., Chairman Anil Ambani said
• Hindustan Unilever has put up a total of seven residential properties for sale in Mumbai and Gurgaon, which could fetch around Rs 35 crore.

RELIANCE deals give way to major moves, Will this make History again

RELIANCE raises Rs 3,188 crore from treasury stock sale
On  Sept 10 2009 RELIANCE IND sold up to 210,000 tonnes of gasoline for October 2009-March 2010 lifting to Western trader Trafigura at a premium of 80 cents to Singapore's spot quotes on a free-on-board (FOB) basis.    http://in.reuters.com/article/domesticNews/idINSP52211220090910

Why did Reliance do both deal within short span and why are analyst who are familiar with RIL worried?
There have been many instances where RIL has set bench mark and most of the top and bottom has been formed after few actions taken by this company.

1)      During 2002 when Crude was trading near $16, RIL made a forward contract for 1year and @ a premium to the prevailing market prices that time and within weeks that had become bottom till today.

2)      RIL sells 4.01% of RPL's equity for Rs.4,023 crore Reported on 27 November 2007 and month of November2007 highest ever for the stock till now.

 http://www.domain-b.com/companies/companies_r/Reliance_Industries/20071124_equity.html  

Monthly Graph of RPL from listing till date and November2007 has seen highest ever price and volume.

3)RIL sold refined products for one year forward @ discount when crude was around $130 around mid of 2008 and within month crude crashed.

The forward contracts for crude oil were placed by a Dubai-based company which handles this part of RIL’s business. The company had booked at least three contracts at $120 a barrel, $100 a barrel and $80 a barrel, respectively, in the middle of 2008, an oil industry analyst said.
http://economictimes.indiatimes.com/articleshow/3910761.cms

On 22^nd January 2009 In evening(6.P.M) after RIL announced results below mail was send to my mailing list:

Reliance announces result Rs.3501crs profit for the 3^rd quarter which is above market estimate with GRM (Gross refinery Margin) $10 highest in the industry.

·         Cash & cash equivalent in hand Rs.28, 500crs ($5.9Billion), over 95% in bank.

·         Jamnagar refinery 98% capacity utilization

There where many rumor about hedging loss and Forex losses, 4month back when crude was $140 they sold 6month forward contract there entire production which I gave importance to say crude has seen peak- but I can’t find the link.  The company performance has been good above market expectation.
Reliance didn’t break Rs.1080 and with that as stop the stock can target Rs.1400 & 1575 target given few days before.

Our view in morning report at that time: ( On 22^nd Jan 2009 Morning report)

Reliance: During the quarter ended December 2007, the company had reported a net profit of Rs 8,079 crore, which included Rs 4,733 crore of extraordinary profit on sale of stake in Reliance Petroleum. Many reports talk about $1 bn loss on hedging of crude contracts. NP above Rs.2400crs would be excellent performance by the company if Rs.2800 above profit is reported then huge short covering possible.

Reliance Industries Ltd has informed BSE regarding a Media Release dated January 22, 2009 titled "Revenue and Earnings Growth in Challenging Times; RPL Refinery started on Schedule; KG D6 Oil Production Commenced in September 2008; KG D6 Gas Production Scheduled in This Quarter".
So bottomline is that whenever RELIANCE enters into some major contract or some major deal (like RPL stake sale or forward contract) they have normally made very good judgment or the best judgment. This time they have entered into short term forward contract in Refined product do they see short term Crude prices topping out and they have sold RIL 1% stake I don’t want to read much into the transaction, will this make History again.

Telecom Watch and News update-A.K.Prabhakar

Telecom Sector: Tata Tele adds 3.42m net-adds vs.2.25m in July, The increase is driven by GSM launch in new circles and aggressive tariff strategy—‘per second billing’ in GSM and ‘pay per call’ in CDMA. The entry of DoCoMo into India after buying stake in TTML is working like magic for TATA TELE. This has triggered tariff war with BHARTIARTL said it would charge 50 paise per minute  for local and national calls on its network, heating up competition in a market that already has some of the world’s cheapest tariffs. When "Lifetime prepaid" was started in India, nobody thought today all service providers may have to provide it but who knows if this "per second billing" also gets that way that all have to implement it this day or the other.

TATATELE adds 22.6% of the total August month net addition and BHARTI added 18.7% growth of TATATELE would put pressure on margin as already Vodafone offers Rs0.50/min ‘regional’ NLD tariffs for Rs35 monthly payment.

TATATELE (9.5%market share) aggressive growth can make them overtake IDEA which has 11.1% and BSNL which has 11.6% market share in months to come to become 4largest telecom operator.

Index is @ 16month high while Telecom stocks IDEA/BHARTIARTL/RCOM are underperforming the general market and IDEA is looking the weakest of all Rs.74.50 below caution is advised in the stock.
IDEA(Rs.76.75)

India's Forex reserves rose to $280.978 billion as on Sept. 11 from $277.649 billion a week earlier, RBI said in its weekly statistical supplement on Friday.

The International Monetary Fund has said that its executive board has endorsed the sale of 403 tonnes of gold, valued at about $13 billion, to increase the institution’s lending capacity to poor countries

Reliance Industries mulling bid for all or part assets of LyondellBasell ,  Reliance Industries could make cash payment of $3.25 billion to LyondellBasell vendors - CNBC-TV18 http://www.moneycontrol.com/news/business/ril-eyeing-stakedutch-petchem-major-sources_416223.html   LyondellBasell is a Netherlands-based bankrupt petrochemical company, which is among the world’s producer of polymers, petrochemicals and fuels. It has an about USD 27 billion in assets with over USD 19 billion in debt at the time of filing for bankruptcy — the company also had an annual revenue of USD 50.7 billion in 2008. It filed for Chapter 11 bankruptcy protection in January this year and obtained a debtor-in-possesion financing of USD 1.8 billion in February — Merrill Lynch, Citigroup and RBS are among the key lenders to the company. LyondellBasell is expected to come out with a rights issue in October for additional liquidity.

Orchid Chemicals said Adurjee & Bros Pvt. Ltd. has raised its stake in the drug maker by 3.59% to 10.35%.

Aurobindo Pharma said it received tentative U.S. Food and Drug Administration approval to sell three drugs in the U.S.

Natco Pharma Launches Swine Flu Medicine; Natflu Priced At Max INR480/Bottle Of 10 Capsules.

Tata Motors: To Launch Electric Indica Car In Europe This Yr; To Spend GBP25 Mln To Develop it; its European Technical Center Gets GBP10 Mln Loan

Axis Bank has raised $720 million through a sale of shares to institutions and an issue of global depositary receipts on strong demand from European and U.S. investors, two banking sources said on Friday.

The IPO of private ship-builder Pipavav Shipyard got subscribed 8.24 times till the final day on Friday, getting a strong response from investors.

Dr Reddy’s Laboratories Ltd jumped to a 3-1/2-year high on Friday on a report GlaxoSmithKline was in talks to buy a 5% stake in the drug maker in a $150 million deal.

Tata Motors said its wholly-owned European subsidiary, Tata Motors European Technical Centre, has got a loan of £10 million (Rs78 crore) from the UK government for its Rs195 crore electric car project.

BHARTIARTL said it would charge 50 paise per minute  for local and national calls on its network, heating up competition in a market that already has some of the world’s cheapest tariffs.

Colombia Ecopetrol to Sell Oil to India?s Reliance, Dinero Says September 18, 2009 11:47 EDT -- Ecopetrol SA, Colombia?s state- controlled oil producer, agreed to sell more than $500 million worth of crude to India?s Reliance Industries Ltd., Dinero reported on its Web site, citing Colombia?s foreign ministry.

U.S Bank failures now at 94 in 2009, FDIC sets up deal for Irwin banks in Indiana, Kentucky.
U.S. stocks on Friday finished higher completing a second consecutive week of gains, with the major indexes up more than 2% from last Friday's close, Bolstered by hope for a global economic recovery.

Market For 18 September 2009

Point to note in today’s Market:

·         Monday holiday so long weekend would force leverage traders to size down position so volatility towards close to be high and profit booking has started across the globe.
·         Nifty has touched 5000 16month high but many stock didn’t perform please don’t average losses and if possible prune under performer if you are a trader or short term investor(7-8months)
·         Market is always efficient so all good and bad news are already built in, so it is more of emotion than other factor which play in market
·         Strong stock: KFA/FSL/PATNI/MRPL/ESSAROIL/PUNJLLYOD Weak Stock: BHEL /CENTURYTEX/UNITECH/AXISBANK/IDEA/RELIANCE/REL,INFRA in Derivative segment based on Derivative data.
·         FII’s Sellers in cash segment if RIL deal of Rs.3188crs is taken out and they have sold in Derivative segment also.


THERMAX said it has bagged an order worth Rs 1,000 crore for a power plant being set up by a Hyderabad-based infrastructure firm. Under the contract, the company would design, construct and commission 270 MW thermal power plant.

Alstom Projects, rail transportation equipment and services provider,  said it has bagged Rs 563.4 crore contract in consortium with global players for providing signalling system to the Bangalore Metro Rail Corporation Ltd (BMRCL).

FIIs invested Rs 43,837 crore ($9.05 billion) into the country's stock markets so far this year as per SEBI data close of Wednesday.

Raymond said its board has approved the proposal for commencement of realty development as new business.

Reliance Industries, said on Thursday it has raised around Rs 3,188 crore through sale of 1.50 crore equity shares of the company.

NTPC is exploring the possibility of taking over the 770 MW Patratu power plant in Jharkhand.

Ranbaxy Laboratories has entered into a deal with South Korean biotech firm Medy-Tox for marketing its cosmetic product, Neuronox in the India.

Rel Infra's order book may cross $7 billion mark.

CMIE has upped the growth forecast for India this fiscal to 5.9% from its earlier projection of 5.8%.

Buoyed by expectations of huge government spending on infrastructure, India's cement industry will spend Rs 90,000 crore in the next 6-7 years for adding around 317 million tonnes of capacity, a study says.   

Inflation turned positive for the first time in three months, rising to 0.12% during the week ended September 5 as foodstuff became costlier. 

U.S. stocks fell Dow -8Points (9784), pulling benchmark indexes down from 11-month highs, on concern the rally outpaced prospects for earnings growth as FedEx Corp. and Oracle Corp. reported sales that missed analysts’ estimates. Dow Fut-10Points @5.28 A.M IST

Steel imports in July surged 94% to 561,000 tonnes against 289,000 tonnes registered in the corresponding period last year, according to the Mumbai-based International Business Information Services, an independent trade intelligence body.


Headlines News:
The Government has set-up a high level panel to redress the problems of the exporting sector in wake of a sharp drop in outward shipments in the past 11 months.
Impact:
Textile, Jewelry (Diamond) and other export based stock showed strength but we have to be selective in that. 


S.Kumars Nationwide Ltd has submitted to BSE a copy of Corporate Updates – Futher information on acquisition of Hartmarx Corporation (HMX) of USA by S.Kumars Nationwide Ltd (SKNL).
http://www.bseindia.com/xml-data/corpfiling/announcement/S_Kumars_Nationwide_Ltd_170909.pdf 

http://www.sknl.co.in   Makers of Brands like

Weekly graph SKUMARNF (Rs.52.35) the stock is waiting for a break-out above Rs.55 where near term target can be Rs.60-64 and as Textile stock show strength ahead of festive season SKUMARYNF has good volumes for entry and exit while many Textile stocks are illiquid.

SKumars Hartmarx - a compelling acquisition http://www.4shared.com/file/133900612/a86ed43a/SKUMARS-HARTMAX_Compelling_acquisition.html

About Sensex From Here Ahead

Sensex View (16677):

• Sensex closes @ 16month high
• Sensex has doubled from March2009 low of 8047 in just 6month.

Sensex from low of 7697 on 27/Oct/2008 has made a 16month high of 16700 on 16/Sep/2009 which is more than double in 11months, time wise Sensex has taken 216trading days to reach here and 223 is an important Fibonacci number which comes next week around Derivative settlement.

Also from March lows it has completed 130 days where 134 is a Fibonacci number again. Derivative is heavily loaded with PCR=1.63 and Overall market Open interest Rs.1,14,426crs and with just 5trading days as Monday 21/Sep/2009 is a holiday due to EID which gives a long weekend, this settlement can see big rollercoaster ride.

Sample of 1290 stocks taken from NSE 279 stocks are near high of 16months in a range of 10%, and Advance to Decline ratio for this month of Sep2009 in  BSE Adv 1794 Dec 1214 Unchanged 18 and NSE Adv 823 Dec 485 Unchanged 9 and Nifty has gained 6.36% in the month of September 2009 and this rally has seen overall performance compared with Rally in 2007.

Advance Tax figure has come and NIFTY50 has a trailing P/E of 22.33 and BSE500 has trailing P/E is 21.84 and even if our growth is 20% Indian market seem to have fully priced and with Market gaining and upside relatively 8-10% from here.

Sensex has made 12Gap-up in last 6months to reach this high and 3Gaps have been formed in this month of September2009 alone and this in technical terms has become overbought. FIIs have been aggressive buyers in market and already short squeeze is very high and once short are removed out of the system market become bottomless where big correction possibly 30-40% becoming possible.

Technically Sensex failing to cross 16700 on closing basis in next few days and move below 15900 is only considered weak till then weakness is not seen technically. But when markets corrects it would become hard to find a buyer, as  market correction are faster than rise.

Market has given excellent return and Investor who had followed me should be happy as for the past 7years we have almost been right but, always being right will be very difficult and by increasing cash position we can always find good stock ideas even if the market where to rise. When we can find buyers for our stocks @ fancy price time we take some profit, and have cash. Correction never happens when we want it, it always happens all of a sudden and many reasons will be attributed to it.

Like before I am unable to say (Predict) if correction is going to start, Time period wise market may be nearing its top so Caution is advised.

Today's News update - 16 Sep 2009

Advance tax figures will make the difference today in market and Nifty trailing P/E is 22.03 and Sensex P/E is 21.37 and if Index EPS growth is maintained around 20-25% then 8-10% upside can be possible in both indices in near term but being stock specific would be advisable. Hotel stocks can be positive after RBI has removed the clause for hotels to be classified as commercial real estate, enabling the companies avail credits at cheaper rates HOTELLEELA/INDIANHOTEL and MAHIDHRAHOLIDAY would be good pick.

http://www.thehindubusinessline.com/2009/09/16/stories/2009091652220100.htm

http://economictimes.indiatimes.com/Market-News/Advance-tax-pay-charges-up-bulls/articleshow/5016197.cms

http://www.business-standard.com/india/news/q2-advance-tax-collections-point-to-robust-recovery/370261/

 

ADVANCE SIGNALS Second installment of advance tax (paid on Sept 15)
Company	2008	2009	% Change
SBI	1500	1838	22.53
RIL	683	1157	69.40
Tata Steel	1000	400	-60.00
DICGC	773	850	9.96
eICICI Bank	575	501	-12.87
HDFC Bank	315	425	34.92
TCS	81	220	171.60
Ambuja Cements	175	150	-14.00
Bank of Baroda	255	412	61.57
BPCL	0	312	NA
Union Bank	108	207	92.00
L&T	150	210	40.00
Bank of India	90	269	198.89
Asian Paints	50	85	70.00
Tata Motors	60	130	116.67
Ultratech	41	125	204.88
M&M	17.5	112	540.00
Central Bank of India	91	79	-13.19
IDBI Bank	20	62	210.00
Tata Power	14	75	435.71
Lupin	17	50	195.00
Tata Chem	61	60	-1.64
Dena Bank	30	45	50.00
Idea	27	32	18.52
Bajaj Auto	90	170	89.00
Videocon Industries	25	30	20.00
Lubrizol India	10	20	100.00
Sterlite Tech	6	20	233.33
Indian Hotels	50	0	NA
Figures in Rs crore

http://economictimes.indiatimes.com/FIIs-fear-higher-tax-outgo-under-new-tax-code/articleshow/5016220.cms FIIs fear higher tax outgo under new direct tax code


PIPAVAV SHIPYARD issue opens today but looks expensive to its peers and one may accumulate BHARTI SHIP and ABG SHIP for long-term returns instead of waiting for PIPAVAV allotment.

SEBI is expected to give next week a 14-day notice to both Bharati Shipyard and ABG Shipyard, which are locked in a fierce takeover battle for Great Offshore, to come up with their final price quotes. Bharati and ABG have to give their quotes in closed envelopes before the deadline ends. Sebi will let both companies run their open offers simultaneously. Both companies can revise their already announced offer prices. No third company will be allowed to enter the fray. Bharati has revised its open offer price to Rs 405 per share, while ABG has given a counter offer of Rs 520. With 20 per cent in Great Offshore already with it, Bharati is looking for another 20%. ABG has a shade below 8% and wants to mop up 32% from the market

The RBI has removed the clause for hotels to be classified as commercial real estate, enabling the companies avail credits at cheaper rates and the move is expected to help companies lower overall cost of hotel projects which has created fresh buying interest in hotel stocks – INDIAN HOTEL and HOTEL LEELA may see 6-8% more gains.

The Indian government is likely to borrow INR1.58 trillion in the second half of this fiscal year, exceeding its earlier target by INR60 billion to accommodate part of the amount from a bond auction scrapped earlier, a senior finance ministry official said Tuesday.

India is failing to curb a growing Maoist insurgency, Prime Minister Manmohan Singh said Tuesday, while also warning of a "worrisome" upswing in cross-border infiltration by Pakistan-based militants.

PUNJLLYOD block deal of 4 lakh shares was executed on BSE at Rs 264.25 per share.

Tata Motors is planning to sell an about 10%-15% stake in its Tata Motors Finance unit as part of its plan to reduce debt. The company plans to sell stakes in various subsidiaries in order to reduce debt, the Web site reported. The sale of the finance unit stake could realize about INR2 billion, it added. Tata Capital could buy the stake from Tata Motors, but the company has also approached other companies operating in the same industry, the Web site reported people connected with the issue as saying. http://economictimes.indiatimes.com/News-by-Industry/Tata-Motors-may-sell-15-in-fin-arm/articleshow/5015925.cms