Tata steel: Rs.655 Buy till Rs.665/-
Ayodhya verdict by High court will be released on 30.09.2010 at 3.30 pm i.e . after trading hours on Thursday. It appears that there will not be much commotion except small incidents here and there. All political parties agreed to keep peace and respect verdict of court.
Sterlite industries: Sell
Court directed sterlite industries to close their Tuticorin copper smelting unit and arrange for alternative employment or compensation to the workers and officers.
Unitech: sell
It appears that this company is involved in CAG's indictment of 2G spectrum case. There is possibility of its indictment and also its plan to come out of telecom business through subsidiary is now resisted by CAG by indictment. Since Supreme court is also looking in this matter and hence this company may lose sizable amount.
IFCI: Buy Rs.62.20 Target short term Rs.70/-
Govt has appointed advisor for IFCI who will submit report before dec2010. IFCI will get bank licence. All companies including L&T, Reliance capital etc. are in the process of applying for bank licences and are awaiting for guidelines.
Tata steel: Rs.645:Buy
Now hold or buy upto Rs.660/-. Now Corus will be rechristened as Tata steel and the restructuring of loans of Corus which will be transferred to New entity Tata steel in Europe will be beneficial to Tata steel. The debts may be reduced to half nearly. Also there is likelyhood of steel price hike at any time.
Visa steel
Mr.Vishambar Saran, ex- tata steel officer, now Chairman of Visa steel has already applied for mining lease in Orissa and Madhya pradesh. When new mining policy is announced, this company will get the iron ore mines soon. Present price is Rs.40. Target Rs.50 within 6 months.The promtors hold 71% and floating stock is only 29%. If any company who is ready to take risk corners this 25%, it can have the capacity to negotiate for directorship and also participate in networth of the company. The stock price is not in consonance with real networth of the company and is very low. Interested controlling parties are managing the share price low so that investors can stay away from the stock.They are making the price often very down in order to drive away investors from this golden stock. But once when any big investor grabs large chunk, automatically the price will rise fantastically as promoters will not sell their stake for fear of losing control. Visa steel promotors should think of making this company just like tata steel thus to reduce debts , they should get good finance partner who can be given some important post.The real worth of the stock is not less than Rs.60/-.
Reliance industries.(Rs.1001) Target Rs.1050/-
There will be another round of talks between Reliance industries and BP for RIL’s exploration and production (E&P) deal. The plan initially was for RIL to club certain blocks and sell 30% to British Petroleum. In April 2010, the valuation of RIL blocks were seen at USD 30 billion. Now reliance wants to create funds for shale gas deals and hence may plan for selling some blocks for sizable amount.
The rights issue in East india hotels will help reliance to reduce its purchase value in EIH to almost market price of EIH. Entering in hotel business and expanding it globally is the vision of reliance thus expanding its growth laterally in many sectors to offset any weakness in any one sector. This is a good management practice and investors will be benefited by it.Expected good refining margins. Expected good half yearly earnings.
Crude price may increase at any time. It is better than ONGC as Govt may allow ONGC to make loss in order to gain votes. Due to Shale gas companies purchase will help reliance to achieve very good growth path. In India, it will be leader in shale gas contracts as it is the one which joined bandwagon of shale gas companies recently compared to others who are just thinking to join. So invest and wait for just 6 months to get results.
It is a suppressed stock. All finance consultants agree on this.If gas price increase, it will shoot up. Gas price is likely to stabilise between $80 to $100 as economy is slowly limbing back to normalcy.The government is also planning to raise the price of state-administered, or APM, gas sold to sectors other than power and fertiliser by over 10 per cent to $5.25 per million British thermal unit (mBtu).The proposal to hike the price for non-power and fertiliser consumers to $5.75 from $4.75 per mBtu is awaiting approval at the highest level and the nod may come any day now.
Bank, reality and software stocks- sell.
Rupee appreciation, expected reduction in growth targets will pull down software stock price. So better to exit now and re-enter at lower levels. Nifty may hover between 5900 to 6000 as domestic institutions and retail investors will step in and replace FII soon. Bringing back ELSS to all people in savings plan giving income tax benefit will help market to enthusiaze public to finance share market and replace FII thus removing the fear of RBI for exit of FIIs. Finance ministry may look into it.
Banks now have NPAs in dangerous levels in education loans, agri loans and to some extent in housing loans. Also there will be less housing loan business expected for reality and banking sector after revised Direct tax code comes in as no income tax benefit is given for repayment of principal of housing loans. Financial consultants,banks, reality companies and experts should recommend to Govt about bringing back the benefit under Sec.80C. Banks will feel the heat once many more private players enter into the areana of banking field like reliance capital, L&T and IFCI etc.
Bank of baroda, Union bank of india and dena bank will be infused with more capital by govt of india. Small quantities of Dena bank and UBI may be purchased at current price.
Mahindra Satyam: Sell
It appears that the results will not be good one and also delisting from overseas bourses due to non-submission of accounts will be bad for this share.
Suzlon: rs.53/- Buy small qty
Suzlon Energy, which holds 91 percent of REpower, is the world's third-largest wind turbine maker behind Denmark's Vestas and Spain's Gamesa. Now it plans to purchase the balance 9% also. Then there will be plan to sell 25% of it stake to bulk buyer in order to reduce its loans. Buy in small quantities .
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