Market News Headlines

Post office revamps money order through mobile services

Rajesh Singla

  The Postal Department is launching an instant money remittance scheme, mobile remittance scheme, in tie-up with the BSNL infrastructure ...

Reliance Industries all set to launch India's first 4G services

Rajesh Singla

If you think 3G is way to go in the coming years, think again. Technology is changing at breath taking speed, People have still to get accustomed to 3G, When Mukesh Ambani is all set to roll out India’s first 4G services in December, 2011. The commercial launch will happen in the first quarter of 2012 by Reliance Industries at an affordable rate of Rs 3000 per month.

What draft of new Telecom Policy have it for common people?

Rajesh Singla

Telecom users will be able to avail free roaming and keep their phone numbers even if they switch service providers anywhere in the country, as per the draft New Telecom Policy unveiled by the government . The distinction between local and STD calls would vanish, as the policy aims at a 'one-nation-one-licence' regime. Telecom Minister Kapil Sibal unveiled the draft New Telecom Policy 2011 Monday, floating several big ideas but providing few details or timelines for implementation.

What is in Land acquisition Bill for Farmers & common man?

Rajesh Singla

After lot of hue & cry, parliament passes the land acquisition bill & finally, 117-year old law on acquisition of land is all set to be changed. What does this bring in for Farmers? How it impact Common man? Let us have a look. The draconian law which has today become a major bone of contention, jeopardizing development and most of the times, livelihood of the farmers, is in the final stages of getting a new face.

Who qualifies & who lucks out for new Bank License guidelines?

Rajesh Singla

Earlier strong contenders (having even expressed keenness to acquire license) such as Singh brothers of Religare and Indiabulls are clearly out of the fray. So also, broking firms like Edelweiss has been shown the red signal for now. Probably these groups can look to enter banking through the inorganic routes at the later stage, but are clearly out of the licensing race. Although gold loan companies like Muthoot and Manappuram Finance seem to be eligible and may be contenders, they are not likely to be awarded licenses by RBI. Ditto for Ajay Piramal. Likewise, LIC Housing Finance may not be included as it is government owned and the current guidelines show RBI’s interest in awarding license to private sector alone. Hence, IFCI also does not look quite likely. On the other hand, Bajaj Finserv, L&T (through L&T Finance Holdings), Mahindras, Shriram group, SREI Infra emerge well qualified. Other corporate bigwigs such as RIL, Tata Group, Aditya Birla Nuvo (Aditya Birla Money is insignificant vis-à-vis the group’s size), ADAG, Kishore Biyani’s Future Group, South-based Sundaram Group, Anil Agarwal’s Vedanta (had previously bid for IFCI) will all be strong aspirants. Finally, the licenses may be awarded by RBI selectively, keeping region-wise presence / footholds in mind – North, South, East, West. Although there may emerge about 25 aspirants (as enlisted above), nevertheless, not more than 5 licenses are likely to be awarded by RBI in this round of new banking licenses, the last awarded one being in May 2004 to Yes Bank. This latest announcement should increase the market value of stocks by not more than Rs. 1,000 crore in market cap. Keep an eye on these names as the new baking license story unfolds in the days to come.

LIC in India & Warren Buffett in America are buying in the downtrend

Rajesh Singla

LIC in India & Warren Buffett were buying stocks when markets fell when others kept fearing. Warren Buffett has been buying amid this week's sharp declines in the market, and has not yet seen anything that suggests another downturn is emerging. Apart from a few shrewd long term investors, know who else was buying aggressively when the markets took a tumble? Life Insurance Corporation or LIC. Having one of the most enviable portfolios in India, LIC bought stocks worth Rs.1000 crore on 5th and 8th August when the markets slipped badly. Imagine what the fall would have been if LIC had not been buying too?

Have Gold ETF!! Now get Gold loan from Muthoot Finance against it

Rajesh Singla

Muthoot Finance Ltd, which claims to be the largest gold finance NBFC in India, today said it will now offer loans against Gold ETF (Exchange Traded Funds) units as security. Launching the service, Muthoot Finance Ltd Managing Director George Alexander Muthoot told reporters here that loans against gold ETF units was a scheme through which Muthoot Finance plans to venture into a totally new segment of gold financing, which would not only add value, but also enable the company to service the financial requirements of newer customer segments.

Infosys, IIP & Inflation

Rajesh Singla

Infosys posted a 5% sequential drop in its net profit at Rs.1722 crore though YoY, it was up 16%. EBIT margin for the quarter was at 26.1% as against expectation of 27.1%. The market is overtly perturbed about the drop in its guidance for FY12. It expects EPS for FY12 at Rs.128.20-130, revenues at Rs 31,777-32,311 crore. In dollar terms, EPS growth is seen at $ 2.88-2.92 for FY12. And for Q2FY12, Infosys expects revenues at US$ 1.73-1.755 billion and EPS of USD 0.67-0.68, a growth of 3.1-4.6%. Before the market could even get over the management interviews on television, news came in about the IIP numbers, which, as expected, were not good. May IIP was down at 5.6% v/s 6.3% on a MoM. So if we felt that April had been a month of moderation, well, May shows that this moderation might well slip into a slowdown in the coming months.

Insurers with 10 yrs operation to tap capital mkt

Rajesh Singla

Insurance companies which have completed 10 years of operations are now eligible to go for initial public offer (IPO). The companies which have completed 10 years of operations include ICICI Prudential Life and HDFC Standard Life. Insurance sector was opened to private sector in 2000. The 10-year clause for public offer is also a part of Insurance Act, 1938. For approval, the insurer should have maintained a satisfactory regulatory record, J Hari Narayan, Chairman, IRDA, said in the draft guidelines on Issues of Capital and Disclosure Requirements (ICDR) for life insurance companies announced on Tuesday.

One stock which is a certain avoid

Rajesh Singla

One stock which is a sudden avoid in spite of making new highs in every few months is Jubilant Foodworks. The company has a famous franchisee brand – Dominos Pizzas. Company came with its IPO at price of 135 Rs. per share last year in January & since then the stock has not looked back. Last time I checked stock is quoting at 800 Rs.

Does ARSS Infra makes an ideal Investment?

Rajesh Singla

Current market price has strong upside We continue to value ARSS on the price-to-earnings basis. Given the slowdown in order intake coupled with stretched working capital, we have assigned a lower multiple of 7x vs. 8x earlier. Based on revised EPS of Rs 81 for FY13, our fair value is revised to Rs 570 per share. At the current market price, the stock merits a valuation grade is 5/5. Savvy’s View: Company is having a good management which is believed to achieve their goals in timely manner. EPS of 75.6 , Profit of 113 crores & Revenue of 1250 makes the company trading at P/E of 6. Company was trading at the levels of 1380 Rs few months before. The slowness in Infrastructure shinned most of its gains. One can take a fresh investment at these levels. The company has good order book & will revive its EPS target to 110. Industry P/E for infrastructure space is around 15. A simple multiplication of 110 * 15 gives us a price more than 1600 Rs. This makes it a ideal investment opportunity. As market will revive, the stock will get much more money pumping in soon.

Is it right time to Buy Reliance Power?

Rajesh Singla

Reliance Power has declared its FY11 results. Its consolidated net profit was up at Rs 760 crore versus Rs 684 ...

LNT results not bad Huh!!!

Rajesh Singla

L&T, as expected did not post a gung-ho set of numbers for Q4FY11. The company posted a net profit of Rs.1686 crore, a 20% rise over Q4FY10 net profit of Rs.1337 crore. But this was a ‘khatta-meetha’ kind of rise as the numbers included an exceptional gain of Rs.226 crore from stake sale in strategic investment. So if stripped of this gain, the rise in net profit was smaller. Yet, the good thing is that profit has grown, not slipped. Its net sales rose 11% at Rs.15078 crore. EBIDTA for FY11 was up 47%. EBIDTA margin for FY11 was up by 10 bps at 15.1% v/s 15.2% in Q4FY10. Order inflow was good at Rs.30,300 crore. This is much below the guidance which the company had given, an order inflow of around Rs.37,000 crore. But once again, the market expected a much sharper fall in order inflow and when that did not happen, hope was restored.

Report Card for 2011 Earnings – Part 2

Rajesh Singla

Part-2 brings some more insight on the results of Big Guns as BHEL, Mundra Port & Max India. Part-1 contains Yearly results for Crisil,MRF,Power Finance Corp,Geojit BNP Paribas,Symphony Limited & Bafna Pharmaceuticals.

Report Card for 2011 Earnings – Part 1

Rajesh Singla

Part-1 contains Yearly results for Crisil,MRF,Power Finance Corp,Geojit BNP Paribas,Symphony Limited & Bafna Pharmaceuticals. Part-2 will bring some more insight on the results of Big Guns as BHEL, Mundra Port & Max India.

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