Wednesday, April 22, 2009

BSE / Nse Shares analysis 22 April 2009

BSE / Nse Shares analysis 22 April 2009

Power stocks can be retained if one is looking at them with a long term view.Stocks like Areva, CESC, NLC, Tata Power, Power Grid Corporation and PFC can be accumulated in a staggered fashion.  Reliance Power can give good returns over a long run, but then, the stock is likely to remain quite slippery in the near term.

Zee Entertainment Enterprises Limited has posted a net profit after tax of Rs 725.40 million for the quarter ended March 31, 2009 where as the same was at Rs 794.50 million for the quarter ended March 31, 2008. Total Income is Rs 3168.10 million for the quarter ended March 31, 2009 where as the same was at Rs 3413.40 million for the quarter ended March 31, 2008. The stock is up nearly 4% at Rs 125.40. One holding the stock with a long term view can stay invested.  Fresh exposure can be considered at Rs 110 - 115 levels.

With as many as 50 stocks set to exit from the derivatives section from May 2009, the midcap space is likely to see some listless action over the next few sessions.  Investors with little or no appetite for risk would do well to stay away from taking fresh exposure in stocks that comprise the list.  A little wait would do no great harm.

Transformers & Rectifiers India Ltd (TRIL) has informed that it has been awarded single order of 55 Nos. of Transformers amounting to by Maharashtra State Electricity Transmission Company Limited.  The order, estimated at Rs 122 crore, will significantly augment the current order book position of the firm.  At Rs 175, the stock is up marginally over its previous closing price. The stock has come a long way up from a low of Rs 102.60 it had touched in late February 2009.

Notwithstanding a few sharp rallies now and then, the market is likely to find the going a bit tough for the next couple of quarters, if not longer.  So, it is better to exit at sharp rallies and stay focused only on a proven blue chip stocks.
Bank, infrastructure, cement and top notch IT stocks are likely to see a significant upmove over the next 12 - 18 months.

One holding Idea Cellular can stay invested for some strong gains over a medium term.  The stock, currently traded at Rs 56, can rise to Rs 60 - 63 in the short run. Investors with a short-term plan can book some profits there and re-enter the counter later at declines.

Marico continues to grow despite economic slowdown.  The company has recorded a turnover of Rs 2388 crore for the year ended March 31, 2009, a growth of 25% over FY08.  The company's profit growth works out to 30% at PBT level and 16% at PAT level if one excludes one time extra-ordinary items from both FY08 and FY09.

Ultratech Cement's net profit for the quarter ended 31 March 2009 rose nearly 16% to Rs 1888.86 crore.  The stock is up by a little over a per cent at Rs 572 now.  Investors holding the stock with a long term view can stay invested and look to increase exposure at declines.  ACC has posted a net profit of Rs 404.76 crore for the quarter ended 31 March 2009.  The cement major had posted a net profit of Rs 357.54 crore for the corresponding quarter last fiscal.

One looking at medium to long term can stay invested in ACC, Ambuja Cements and Ultratech.  Exposure can be increased at sharp falls.  Since construction and infrastructure projects may take off anytime in the next couple of quarters, demand for cement is likely to see a sharp rise later this year.

Indian Hotels (Rs 51.50) can move on to Rs 60 if it continues to trade firm here for a few sessions.  A decisive breakout there can result in a surge to Rs 75.  On the downside, the stock has good support near Rs 43. One can have a stop loss around that level.

BGR Energy Systems has announced that the Environmental Engineering Division of the company has secured a contract for Design, Engineering, Supply, Erection and Commissioning of large "Total Water System" from Maithon Power Ltd, Jharkhand.
The contract is valued at Rs 15.50 crore. The stock is up 1.5% at Rs 176.50.

Forecast of a near normal monsoon is expected to keep fertilizer stocks in focus.  One can stay invested in stocks like Nagarjuna Fertilziers, Chambal Fertilizers, Tata Chemicals, RCF, Deepak Fertilizers and GSFC.  Declines can be treated as opportunities to increase exposure to the sector.

Wipro (up 5.4% at Rs 289) has moved up sharply this morning following a sharp jump in the Group's consolidtated net profit for the quarter ended 31 March 2009.  On a standalone basis, however, the company's net profit has dropped down by around 6.75% to Rs 842.10 crore.  One holding the stock with a long term view can stay invested and pick up more of it at sharp declines.

Riding on the strength of realty, bank, metal, auto and capital goods stocks, the market moved up and posted sharp gains in early trade this morning.  Positive global cues have contributed to the early surge today.

The Sensex, which opened at 10,968.80, edged up to 10,992.21 and is currently up with a sharp gain of 77.84 points or 0.71% at 10,975.95.  The Nifty is up 23.70 points or 0.7% at 3389.  Suzlon, PNB, ICICI Bank, DLF and Tata Steel are up 3% - 6% now.
Unitech, RComm, Axis Bank, Tata Motors, Reliance Capital, Wipro, Siemens, Hindalco and L&T have posted sharp gains.   Heavy weight stocks, RIL, SBI and HDFC also trade firm.

Market Outlook

The market is expected to open on a firm note on positive global cues. There may be some profit taking at higher levels but the undertone is likely to remain fairly positive right through the session today.

Sector Watch

Cement stocks will see plenty of action with industry majors ACC and Ambuja Cements scheduled to announce their quarterly results during the course of the day.

Realty and bank stocks are likely to find support. Information technology stocks are expected to surge higher. Selective buying is seen in metal, pharma and capital goods sectors.

Scrip Watch

Wipro has posted a consolidated net profit of Rs 10100 million for the quarter ended March 31, 2009 as compared to Rs 8800 million for the quarter ended March 31, 2008. On a standalone basis, Wipro has posted a net profit of Rs 8421 million for the quarter ended March 31, 2009 where as the same was at Rs 9029 million for the quarter ended March 31, 2008. Total Income is Rs 53966 million for the quarter ended March 31, 2009 where as the same was at Rs 53681 million for the quarter ended March 31, 2008.

HCL Technologies Limited has posted a net profit of Rs 1525.70 million for the quarter ended March 31, 2009 as compared to Rs 2630.80 million for the quarter ended March 31, 2008. Total Income has decreased from Rs 13291.30 million for the quarter ended March 31, 2008 to Rs 10930.70 million for the quarter ended March 31, 2009.

GTL,Hindustan Zinc, Yes Bank, Marico, Macmilan Industries and Zee Entertainment will be announcing their results.

ICICI Bank is likley to be in focus following the bank reducing benchmark lending rates by 50 basis points.

Sesa Goa is likely to attract attention on reports that the company is looking at options of bidding for the controlling stake in an iron ore mine that has been put on the block by Brazil's mining exploration company GME4.

Hero Honda may attract attention following the company reporting a sharp 34.6% jump in net profit for the quarter ended 31 March 2009.

Macro and Market Factors

Stock prices rebounded on Wall Street yesterday after suffering some big losses in the previous session. The US Treasury Secretary's assurance to the Congressional Oversight Panel that there is enough money left in the government's $700 billion financial rescue program to stabilize the financial system brought the bulls back to the ring.

Asian markets are trading mixed now after a positive start. Despite a 25 basis points cut in Repo and Reverse Repo rates, the Indian market had drifted lower yesterday. The RBI governor feels that banks needed to lend to ensure economic activity continues unhindered, reminding banks that in the current environment their challenge was to keep credit flowing, while, at the same time, maintaining portfolio quality.

Compiled and Brought to you by 

Equity Research Team

Intelligent Investor -
Invest Advisory Arm of

Ravina Consulting
Bangalore India

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