PSU Shares - Gold Mine or Black Hole ?

Dear Investors,

The recent rally in BSE and NSE has given a big boost to the most neglected sector - Public Sector Undertakings.  

BSE PSU Index comprises of 59 scrips out of which 24  belong to Nationalized Banks.  Rest 35 shares belong to core business / manufacturing activities.  Many stocks in this sector are under owned by both FIIs and Domestic Institutions, HNIs for the simple reason that these are thoroughly mis-managed.

The Sector is out of investment radar of large investors due to uncertainty. There are several reasons for the downturn in PSU stocks include decline in net profit and the government's move to sell shares of some of these companies via offer for sale, at a discount to prevailing market price.  Any further equity dilution means - more supply depressing the market price.  FPOs by the government has become a nightmare for the Retail investors as they are now trading at deep discount to their issue price.  

For the smart investors this gives a golden opportunity to buy into high quality stocks at attractive valuations.  The top ten identified by our Research Team is given below :

1. BHEL
2. BPCL
3. BEML
4. Coal India
5. Engineers India
6. GAIL
7. Hindustan Copper
8. Indian Oil
9. NMDC
10. ONGC

Investors should carefully analyze the price movements of these shares besides the Q4 results for 2014 before taking any investment decisions.

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BHEL - Buy

This public-sector power equipment behemoth is currently facing some challenges. Apart from the high interest rates, the power sector has been hit by bottlenecks in the form of slow-paced reforms, difficulty in getting environmental clearances and establishing coal linkages. Increased competition from Chinese players also seems to be playing spoilsport for many power sector companies in India.

However, Bhel is well-placed to tide over these challenges and appears most attractive from the valuation perspective. With the sheer scale of its operations and high research and development (R&D) capabilities, Bhel is in a position to thwart any competitive pressures. It will also benefit from the recent government clause that prevents companies with no domestic manufacturing facilities from placing bids for super-critical equipment.

The comfortable debt on its books also ensures that it is not adversely impacted by high interest rates. Its impressive order book (around Rs1,640 billion at the end of 2010-11) provides a strong visibility on future earnings. Order inflows are expected to pick up further when the interest rates soften. Bhel is also planning to ramp up its capacity, with plans to increase its equipment manufacturing capacity from the current 15,000MW to 20,000 MW by the end of 2011-12.



Performance :

The scrip has under performed in line with the Capital Goods Index and is likely to move side ways in the near term.

Time Span	Price	Change	%Change
Today	1,746.20	9.70	0.55
Week	1,683.25	53.25	3.16
Month	1,824.90	-88.40	-4.84
Three Months	1,936.00	-199.50	-10.30
Six Months	1,975.00	-238.50	-12.07
One Year	2,478.50	-742.00	-29.93

Our Recommendation :
Buy on steep declines to around 1600 and hold for a period of 2-3 years for a decent returns, long term investors should hold the stock with a strict stop loss of 1600/-

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BHEL - Portfolio Buy

Latest Quotes | News/Announcements | Quarterly Results | P&L |Price History The company's stock trades at a P/E of less than 14, the lowest since March 2005. The current price makes the stock an attractive buy, given its strong balance sheet and sound financials. It has been logging a double-digit revenue growth, consistently since the past five years. However, order inflows and growing competition from Chinese manufacturers are some near-term concerns.

The scrip gave negative returns in the past year

Time Span	Price	Change	%Change
Today	1,736.50	-15.10	-0.86
Week	1,683.25	68.35	4.06
Month	1,824.90	-73.30	-4.01
Three Months	1,936.00	-184.40	-9.52
Six Months	1,975.00	-223.40	-11.31
One Year	2,478.50	-726.90	-29.32

The scrip has under performed during the last 1 year and is likely to be subdued going forward. Long term portfolio investors can buy around Rs.1500 levels for a target price of Rs.2,500 holding period of 12-15 months.


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BHEL - Sell

More competition, falling new orders should keep things tight in the medium term.

The impact of rising competition and the slow pace of new power projects has started to reflect on Bharat Heavy Electricals’ (BHEL) financials, judging by its results for the June quarter. Revenue growth reported by BHEL, big daddy of the Indian power equipment industry, was the lowest in the past 13 quarters. Order inflows dived 75 per cent year-on-year to Rs 2,500 crore — again, the lowest ever, amid subdued activity in the power sector and industrial capex.

While the order book is still robust at Rs 1,59,600 crore or four times the company’s 2010-11 sales, it has slipped marginally by three per cent sequentially; year-on-year growth at eight per cent touched a new four-year low.

Not surprisingly, the stock fell close to nine per cent in the past two trading sessions and could correct further, as the outlook appears subdued. Analysts believe order inflows, order book, sales growth and margins are on the way down.

MUTED GROWTH
Rs crore	FY11	Q1FY12
Total operating income	42,496	7,271
% chg y-o-y	27.0	10.0
Operating profit	8,963	1,113
% chg y-o-y	43.0	15.4
OPM (%)	21.0	15.3
Chg y-o-y (bps)	245	69
Net profit	6,011	816
% chg y-o-y	39.4	22.2
NPM (%)	14.1	11.2
Chg y-o-y (bps)	130	110
Source: Company

Say Arun Kumar Singh and Murtuza Zakiuddin, analysts, HSBC Global Research, in their July 27 report, “Earnings growth should be flat in FY13-14 versus a CAGR (compounded annual growth rate) of 30 per cent in the past five years." Analysts at Emkay Global expect BHEL’s earnings growth to range five to nine per cent in FY12 and FY13. Most analysts believe the risk-reward equation is currently not favourable, despite the stock’s underperformance in recent months.

OTHER INCOME BOOST
BHEL’s revenues, or total operating income, grew just 10 per cent year-on-year in the quarter, half the pace as compared to analysts’ expectations. Execution was weak due to delay in clearances at the ports (thereby impacting the company’s plant commissioning) in particular and delays in progress of power projects in general. The company’s power segment, which accounts for 80 per cent of total sales, reported a mere eight per cent growth in top line.

On the other hand, BHEL’s industry division did better than expected, wherein profits jumped 120 per cent. This and operating leverage helped the company maintain its operating profit margin at around 15 per cent. Net profit margin improved despite a higher base and a surge in depreciation, thanks to the 52 per cent jump in other income (to Rs 249 crore).

MUTED OUTLOOK
In 2011-12, the company expects growth in revenues and order inflows to be 15-20 per cent and 10 per cent (Rs 66,000 crore or 1,600 Mw), respectively. Says B P Rao, chairman and managing director of the company, “We expect execution to pick up in coming quarters and thus maintain our revenue booking target of Rs 50,000 crore in FY12."

However, analysts expect things to remain tight in the medium term. They believe the impact of competitive pressures will become increasingly visible. Ordering activity is likely to be muted, as 90 per cent of 12th Plan projects have been awarded and Chinese players have already garnered a sizeable share (above 50 per cent). Analysts expect the order book to remain flat in the current financial year after a 26 per cent CAGR between 2006-11. This will affect sales growth beyond 2012-13.

Margins, which peaked in 2010-11, are also expected to eventually come off the current levels due to competition and higher imported components for super-critical equipments initially. Emkay’s analysts, in their July 26 report, estimate BHEL to report Ebitda (earnings before interest, taxes, depreciation and amortisation) margins of 19.7 per cent in 2011-12 and 18.6 per cent in 2012-13, as compared to 21 per cent in 2010-11l. Consequently, the return profile will deteriorate.

The stock currently trades at Rs 1,825 levels. Even after correcting 25 per cent in the past year, touching a 52-week low in June, and trading at five-year trough valuation of 14 times 2011-12 estimated earnings (below industry multiple of 16), analysts feel BHEL’s stock will de-rate further, given the weak fundamental outlook of the power equipment sector.

Says Misal Singh of Religare Institutional Research in a July 6 report, “Valuation multiples are likely to trend lower, as the growth profile normalises beyond FY12." The upcoming follow-on public offer is also likely to put pressure on the stock.

The stock has been a big under performer over a 1 year horizon. The following details give the kind of returns the scrip gave

Time Span	Price	Change	%Change
Today	1,716.00	-72.05	-4.02
Week	1,838.35	-50.30	-2.73
Month	1,952.40	-164.35	-8.41
Three Months	2,057.70	-269.65	-13.10
Six Months	2,188.10	-400.05	-18.28
One Year	2,517.40	-729.35	-28.97

Our Recommendation :

Sell on every rise. For portfolio investors start buying the scrip around Rs.1200 levels on a deep corrections, only after Jan 2012. the out look for the next 6 months is dismal and it could drop further from current levels.

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buy BHEL

BHEL is a public sector undertaking (PSU) managed like private companies. “It is highly profitable due to monopoly in various sectors. Research & developments are leading to greater highs in product quality and performances. BHEL also has strong presence in overseas markets and is a good stock for investment,” says Surana.

Our recommendation :

IT has been consolidating at current levels investors should add on dips for a decent 10-15% returns in the next 3 months time frame.

Source : ET.com

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Brokerage Views - Crompton, Tata Motors, Tata Tea, Dishman, BHEL

Analysts' corner

S I Team / Mumbai March 30, 2009, 0:21 IST

Crompton Greaves
Reco price: Rs 122.15
Current market price: Rs 120.95
Target price: Rs 110
Downside: 9.5%
Brokerage: BNP Paribas Securities

Crompton Greaves (CR) will be investing Rs 230 crore for acquiring a 41 per cent stake in Avantha Power (AP). AP has four captive power units and is in the process of developing two more power plants of 600MW each, which include Korba Project at Raigarh in Chhattisgarh and Jhabua Project at Seoni in MP.

The total consolidated cash in FY09E is expected to be Rs 405 crore. Thus, post the acquisition of AP, the company can buyback a maximum of 3.9 per cent of outstanding shares. However, given the company’s need for working capital, the maximum buyback will be up to 1.6-2.0 per cent of outstanding shares. The company has successfully integrated three acquisitions to fill in product gaps and to enter new geographies. The brokerage favours the continuation of this acquisition strategy to acquire technologies such as HVDC and automation systems than to forward integrate into power generation. At Rs 110, the stock trades at 7.3x of FY10E earnings. It is trading at a discount to its peers due to a higher exposure to weakening T&D capex cycle in Europe and US (40 per cent of sales) and on account of the weakening demand in its industrial and consumer segments. Maintain reduce.

Tata Motors
Reco price: Rs 166
Current market price: Rs 172.70
Target price: Rs 100
Downside: 42.1% 
Brokerage: Edelweiss Securities

---

Tata Motors has launched Nano with several options, wherein the base version is priced at about 30 per cent lower than the M800. With deliveries slated to start in June 2009, the company is likely to produce around 50,000 units in FY10. This will contribute Rs 500 crore to standalone revenues. But, Nano is expected to be profitable only on high volumes, thus the project is unlikely to make a positive contribution to the company’s bottomline in FY10.

The favourable demographics of the Indian market indicate a large potential demand for a low-priced car like Nano. However, the key to the car’s success will be its on-road performance. Given the huge excitement the car has generated, any let down will impact its demand. Initial reviews of the car will be crucial to its success. While Nano could yield Tata Motors long-term positives depending on its performance, till then, the company is likely to continue to be plagued by a large funding gap, decline in domestic CV sales, and integration of Jaguar and Land Rover. The brokerage has estimated a fair value (target price) of Rs 100 for the stock. Maintain sell.

Tata Tea
Reco price: Rs 553
Current market price: Rs 559
Target price: Rs 853
Upside: 52.6%
Brokerage: Sharekhan

---

With tea volumes growing moderately in the domestic and international markets, Tata Tea is seeking opportunities to expand its beverage portfolio beyond tea and coffee. Tata Tea has launched ‘T!ON’, a tea and fruit based cold beverage in three variants-Mango Rush, Peach Punch and Apple Buzz in a 400 ml pet bottle priced at Rs 22. The non-carbonated beverages segment is growing at a healthy rate of 35-40 per cent in the domestic market. Tata Tea’s entry into this segment could be the much-needed revenue driver.

The company’s profit margins have been under pressure in FY09 and are likely to remain so with higher raw material prices, especially due to tea prices staying firm on account of tight demand-supply situation in India and globally. However, with a portfolio of strong global brands, Tata Tea has the ability to take price increases to ease the pressure on margins. In the domestic market, it has selectively hiked prices by 7-9 per cent in the beginning of Q4 FY09. The brokerage expects the company to sustain margins in FY2010.

The company’s focus on new geographies and new initiatives (green and herbal tea, fruit-based beverages and mineral water) augur well to sustain the growth at a consolidated level. At Rs 553, the stock trades at 8.7x its FY10 earnings estimate and 3.2x EV/EBITDA. Maintain buy.

Dishman Pharmaceuticals
Reco price: Rs 95
Current market price: Rs 98.15
Target price: NA
Brokerage: ICICI Securities

---

Dishman Pharmaceuticals is a world-class player in the global CRAMS market with expected revenues of Rs 1,000 crore for FY09, of which the CRAMS segment is likely to contribute around 75 per cent. Dishman’s collaborative deal with Polpharma of Poland will utilise the former’s back-ended capabilities and this deal is expected to be a medium-term positive with expected revenue contribution from FY11.The company announced a 13 per cent salary cut for all its employees along with production cut by one day per week at its manufacturing plant at Bavla, near Ahmedabad. This is likely to result in cost savings of Rs 6-7 crore for FY10. With customers tightening inventory and R&D budgets, most CRAMS players are facing a demand slowdown. Besides, rationalising in Solvay’s (top customer of Dishman) production sites could result in lower growth in revenues and profit, at least through to FY10.

The highest ever forex loss in Q2 FY09, issue of pledged shares and mid-cap stock correction has seen the stock tank 69 per cent in the past six months. Dishman is on track to achieve its FY09 PAT guidance of Rs 150 crore. The stock trades at FY10E P/E of 4x and P/BV of 0.9x. Reiterate buy.

BHEL
Reco price: Rs 1,410
Current market price: Rs 1,570.15
Target price: NA
Brokerage: India Infoline

---

Although execution issues are easing, the thermal power project site where BHEL is a BTG vendor is still facing constraints for acceleration in execution. The physical targets set for FY09 would be missed by 12-13 per cent. Domestic supply-chain bottlenecks have eased significantly, with the Trichy plant being able to meet the requirements well ahead of schedule. Considering the execution issues, FY10 revenue targets would translate into around 20 per cent growth, which is 5-6 per cent lower than consensus estimates. In FY08, BHEL’s revenues were in line with the targets. In FY09, BHEL is unlikely to outperform, given the execution slippage in Q3. Hence, FY10 consensus revenue estimates could be revised downwards.

In Q3, the management increased the FY09 employee cost estimates to Rs 4,300 – Rs 4,500 crore. Thus, in FY10, employee costs could provide a positive surprise (pending final negotiations), notwithstanding increased gratuity provisions. Against order inflow guidance of Rs 40,000 crore given at start of the year, the management expects to end the year with inflows of Rs 60,000 crore, a 20 per cent y-o-y growth in an environment where other engineering players are finding it difficult to sustain order books. Maintain buy.

Current market price as on March 26, 2009

source : business-standard

BHEL - Buy

BHEL: Powered-up

Investors can accumulate the stock of BHEL, given its consistently strong order inflows, timely capacity expansion measures to meet the increased opportunities and negligible funding issues, despite the tough environment. At the current price of Rs 1,311, the stock trades at about 15 times its expected earnings for FY10.

The market has traditionally awarded a premium to the stock as a result of its highly visible and sustainable growth prospects. Buy the stock on declines linked to broad markets to average costs.

An order backlog of Rs 1,13,600 crore, as of end-2008, speaks of the revenue potential for BHEL over the next two years, though power cuts, component shortage and delays in certain clearances led to lower revenues in the December quarter.

We believe that these issues are inevitable for a company of this size, give the customised component requirement and its dealings mostly with other government organisations such as the State electricity boards.

Operating profit margins too declined to the less than 17 per cent mark on account of higher raw material cost and employee expenses. These two parameters could see some improvement in the coming quarters.

The competitive threat from BHEL’s Chinese counterparts have receded to some extent, given the spate of quality issues raised over the past year regarding Chinese equipment. The appreciating dollar has also helped narrow the pricing gap between the local and Chinese equipment.

VIDYA BALA

businessline 08-03-09

Our View :

The prices have run up in the last week too fast and with this speed it can touch Rs.1650.  One should not invest at this high price but should start buying around 1350 levels for a decent gain over a 6 months period.

Dashes Expectations leads to Crash in NSE and BSE

Disappointed with the interim budget presented today, the Indian markets steadily declined until the end of the trading session thus closing deep in the red. The Sensex closed lower by around 340 points, while the Nifty closed lower by around 100 points. Stocks from the mid-cap and small-cap indices too ended the day on a negative note. Stocks from the metal and capital goods sectors led the pack of losers today. Rupee closed at 48.79 against the US dollar. The Asian markets ended on a mixed note today. The European indices are currently trading weak.

As per a leading business daily, demand for power has fallen by around 600 MW during the period April 2008 to January 2009 as against the corresponding period last year when it had increased by 4,500 MW. The demand for power declined from 106,943 MW to 106,336 MW during the period under consideration on account of slowdown in the industrial consumption due to the current economic crisis. It may be noted that the Ministry of Power had estimated the electricity demand to increase to 859 bn units by 2012, if India were to maintain an 8% GDP growth rate, while to maintain a 7% GDP growth rate it would require an electricity demand of around 820 bn units. However, currently India’s power demand stands at around 730 bn units as against a generation of around 666 bn units of power annually. Any further weakening of demand for power may adversely affect power equipment manufacturers like L&T and BHEL, as the healthy demand for power equipment in the past few years has been largely due to the continuously increasing demand for power in the country. The stocks of L&T and BHEL ended the day on a weak note.
As per a leading business daily, ONGC and other state-run explorers will pay refiners Rs 320 bn as subsidies for selling fuels below cost for FY09. This amount will be part of the compensation for PSU refiners like IOC and HPCL which may lose revenue of about Rs 1 trillion during the year. In January 2009, the PSU retailing companies were making a profit on petrol and diesel. However, those gains were wiped out by losses on kerosene and cylinder of LPG. The refiners will get bonds from the government to cover the remaining amount for which all accounts will be settled at the end of FY09. The stock of ONGC, HPCL and IOC ended the day on a weak note.

As per the interim budget announced today, despite the severe global financial crisis, India recorded a 45% YoY growth in foreign direct investment (FDI) between April and December 2008. It received an FDI inflow of US$ 23.3 bn during the period. This even though during FY08, India's FDI inflow was already a robust US$ 32.4

NTPC's nuclear foray
The markets continued to trade in the negative territory on account of sustained selling activity witnessed during the previous two hours of trade. Stocks from the power, engineering and construction sectors are leading the pack of losers, while select stocks from the media, auto and FMCG sectors are trading higher. The overall decline to advance ratio is poised at 2:1 on the BSE.

As per a leading business daily, the government may soon put in place norms for monitoring prices of costly imported patented medicines for diseases such as diabetes, arthritis, obesity, cancer and heart diseases. Once finalised, the new norms will see the government negotiating prices for imported medicines for identified diseases based on prices of the same medicine in other markets and the estimated cost of production. The companies would be expected to voluntarily keep prices lower in India for other imported patented drugs. Though this move is aimed at increasing the affordability of these medicines for consumers, the same would prevent MNC companies such as GSK Pharma, Eli Lilly, Roche, Aventis and Pfizer from selling their drugs at a huge premium in the country.

Power stocks are trading lower led by Reliance Power, Power Grid Corporation and NTPC. As per a leading business daily, NTPC and Nuclear Power Corporation of India (NPCIL) has signed a MoU to form a joint venture (JV) company that will set up nuclear power projects in India. NTPC would hold around 49% stake in the JV, while the remaining would be with NPCIL. It may be noted that NPCIL is the sole agency generating nuclear power in the country with a capacity of about 4,120 MW. Total nuclear power generation in India is estimated to be around 20,000 MW by 2020. This move would help NTPC to gain presence in the nuclear power segment which is expected to witness strong focus by the government going forward.

Source : Equitymaster.com

Market Wrap for week ending

It was a good week for the Indian market that showed resilience and held its own amidst its global peers. On the domestic front, good IIP numbers and lower inflation figures kept the market in a positive frame. While the market goes into next week with a positive bias, experts are not convinced there is more steam left for the market to go up. This week's good figures are: Sensex up 3.5% and Nifty up 3.7%. BSE Midcap index up 4.5%, BSE Smallcap index up 3.5% over the week. BSE Realty index up 13%, BSE Consumer Goods index up 7.7%, BSE Auto index up 6.5%, BSE Bankex index up 5.5%, BSE Metal index up 3.5% and BSE Oil & Gas index up 3%.  

Positive global cues saw the Indian market close higher today. There was some profit booking in last hour of trade. Experts felt the market did not have any major expectations from the interim rail budget and thus almost ignored the event today. They added that the market could see a sell off on Monday due to the vote on account and interim budget. Sensex shut shop at 9634, up 168 points and Nifty at 2948, up 55 points from the previous close. CNX Midcap index was up 1.65% and BSE Smallcap index was up 0.62%. The market breadth was positive with advances at 771 against declines of 417 on the NSE. Top Nifty gainers included Mahindra & Mahindra, Idea and Reliance Communications while losers included Sun Pharma, GAIL and ABB. 

One can expect a global rally in the next two months, feels Amitabh Chakraborty of Religare Securities, on CNBC TV18. The market could see a selloff on Monday on account of the interim budget, he says. But Nifty could possibly go to 3500 till the elections, he adds. 

The market may see a sell off on Monday if there are negative surprises in the interim budget, says Gaurang Shah of Geojit Financials, on NDTV Profit. It would be a good time to book profits across the board, he adds.  

The acid test for the market is likely to be 3100, feels E Mathew, technical analyst, on CNBC TV18. It is to be seen if Nifty can convincingly cross that level or peter out, he says. If Nifty can cross 3100 then levels of 3482 and 3500 is what one can expect, he adds. 

Hold Reliance Communications with a target price of Rs 200 where one can book profits and exit the stock, says Ashwani Gujral, technical analyst, on CNBC Awaaz. The stock has support at Rs 160 and is currently trading at Rs 181, up 5.3% on the BSE.  

Hold Sesa Goa with a target price of Rs 120 in 2 months, says Salil Sharma of Kapoor & Sharma Company, on CNBC Awaaz. The stock is currently trading at Rs 95, up 2.08% on the BSE.  

Hold Bharti Airtel with a target price of Rs 750 where one can book profits and exit the stock, says Ashwani Gujral, technical analyst, on CNBC Awaaz. The stock is currently trading at Rs 652, up 0.26% on the BSE. 

Hold Dish TV with a target price of Rs 30-32 where one can book profits and exit the stock, says E Mathew, technical analyst, on CNBC TV18. The stock is currently trading at Rs 27, up 16% on the BSE. 

Hold Idea Cellular with a target price of Rs 58 where one can book profits and exit the stock, says Ashwani Gujral, technical analyst, on CNBC Awaaz. The stock has support at Rs 33 and is currently trading at Rs 51, up 5.2% on the BSE.  

Hold Idea Cellular with a target price of Rs 56-60 where one can book profits and exit the stock, says VK Sharma of Anagram Stock Broking, on Zee Business. The stock is currently trading at Rs 51, up 5.2% on the BSE.

 If Nifty is able to sustain above 2950 then it could see an upmove to 3050, says Atul Badkar of Edelweiss, on CNBC TV18. It would be good to book profits at higher levels, he adds.  

It was a good day for the market that closed higher thanks to positive global cues. Sensex closed at 9617, up 151 points (provisional) and Nifty at 2948, up 55 points (provisional) from the previous close. CNX Midcap index was up 1.4% and BSE Smallcap index was up 0.82%. The market breadth was positive with advances at 771 against declines of 417 on the NSE.  

Hold all Nifty long positions with a target of 3050-3075 and stop loss of 2840, says E Mathew, technical analyst, on CNBC TV18, as closing market strategy. 

Book 50% profits on long positions and hold the rest with Nifty target of 3050, says Anil Maghnani, on CNBC TV18, as closing market strategy.

Hold Nifty long positions, says Deepak Mohoni, technical analyst, on CNBC TV18, as closing market strategy.

It is worthwhile to wait and watch which way the market is likely to go, says Sudarshan Sukhani, technical analyst, on CNBC-TV18. If Nifty is able to cross 2940 then it could rally another 100 points, he says. So stay long, he adds. 

If Nifty closes above 2930 then it could go up to 2960 which is a strong resistance level, says MB Singh, technical analyst, on Zee Business. If Nifty is able to cross 2960 then it would mark a short-term uptrend and Nifty could even rally another 150 points, he adds.  

Crnindia.com maintains a buy call on GMR Infrastructure with a target of Rs 88 and stop loss of Rs 73, reports CNBC Awaaz. The stock is currently trading at Rs 79, up 2.57% on the 

SMC Global Securities maintains a buy call on Alstom Projects with a target of Rs 340 and stop loss of Rs 268, reports CNBC Awaaz. The stock is currently trading at Rs 287, up 0.90% on the BSE. 

HEM Securities maintains a sell call on Ranbaxy with a target of Rs 192 and stop loss of Rs 222, reports CNBC Awaaz. The stock is currently trading at Rs 211, down 0.59% on the BSE.  

Sharekhan maintains a buy call on Bajaj Auto with a target of Rs 640, reports Zee Business. The stock is currently trading at Rs 484, up 1.25% on the BSE.  » Send to friends

Crnindia.com maintains a buy call on Ambuja Cements with a target of Rs 79 and stop loss of Rs 70, reports CNBC Awaaz. The stock is currently trading at Rs 73, down 0.20% on the BSE. 

Tata Steel continues to be in a range of Rs 165-Rs 220 and one can trade accordingly on the lower and upper side, says Ashwani Gujral, technical analyst, on CNBC TV18. The stock is currently trading at Rs 195, up 5.23% on the BSE. 

Buy Kalpataru Power and Lupin for the long term for good returns, says Jigar Shah of KIM ENG Securities, on CNBC TV18. Kalpataru Power is currently trading at Rs 277, up 4.4% and Lupin at Rs 638, up 0.23% on the BSE. 

Hold Nifty long with a stop loss of 2880, says Ashwani Gujral, technical analyst, on CNBC TV18. Nifty range is 2940-2960 and the market does not seem to have much fuel left to go up, he says. The market does not have much upside now, he adds.  

The European markets have opened in the positive. Positive global cues see the Indian market continue to trade firm. Sensex is trading at 9666, up 200 points and Nifty is at 2954, up 61 points from the previous close. CNX Midcap index is up 1.7% and BSE Smallcap index is up 1.11%. The market breadth is positive with advances at 868 against declines of 285 on the NSE. 

Buy Sterlite Technologies with a price target of Rs 120 in 12 months, says Jigar Shah of KIM ENG Securities, on CNBC TV18. The stock is currently trading at Rs 65, up 2.42% on the BSE.  

Angel Broking maintains a buy call on Petronet LNG with a target of Rs 80, reports Zee Business. The stock is currently trading at Rs 37, up 0.02% on the BSE.  

HEM Securities maintains a buy call on Titan Industries with a target of Rs 879 and stop loss of Rs 820, reports CNBC Awaaz. The stock is currently trading at Rs 857, up 0.42% on the BSE.

The economy is likely to see a significant slowdown in the second half of this year, says Tushar Poddar of Goldman Sachs, on CNBC TV18. Do not expect the IIP numbers to bounce back in January-March, he says. Exports may go down by 20%, he adds.  

Buy ABB close to Rs 435-420 with long-term view, says PK Agarwal of Bonanza Portfolio, on Zee Business. It has resistance at Rs 480, he adds. It will give good returns, he says. The stock is currently trading at Rs 448, down 1.6% on the BSE. 

Investors should stay away from Educomp Solutions, says Deepak Mohoni, technical analyst, on CNBC Awaaz. There is downside volatility in the stock and overnight risk is too much, he adds. The stock is currently trading at Rs 2051.50, up 4.9% on the BSE. 

Buy MRPL with target of Rs 46, says Ashwani Gujral, technical analyst, on CNBC Awaaz. Keep stop loss of Rs 37, he adds. The stock is currently trading at Rs 40.90, up 0.4% on the BSE.  

Hold Power Grid with stop loss of Rs 80, says PK Agarwal of Bonanza Portfolio, on Zee Business. It can go up to Rs 140, he adds. The stock is currently trading at Rs 93.70, up 3.1% on the BSE.  

I am negative on IT space, says Vibhav Kapur of IL&FS Investmart on CNBC TV18. Indications are that IT spending will be cut and there is a lot of pricing pressure, he adds.

Hold IDFC with stop loss of Rs 50, says PK Agarwal of Bonanza Portfolio, on Zee Business. It will give good returns in the long run, he adds. The stock is currently trading at Rs 58.75, up 3.1% on the BSE. 

Stay away from SKumars Nationwide, says Sudarshan Sukhani, technical analyst, on CNBC TV18. The stock is currently trading at Rs 20.90, up 2.2% on the BSE

Hold IDBI Bank which is for quite some time trading in the range of Rs 50-60, says PK Agarwal of Bonanza Portfolio, on Zee Business. Keep stop loss of Rs 50, he adds. The stock is currently trading at Rs 56.10, up 1.5% on the BSE.  

Go long on Hero Honda with target of Rs 970, says Devangshu Dutta, market expert, on CNBC TV18. Keep stop loss of Rs 890, he adds. The stock is currently trading at Rs 926.95, up 1.2% on the BSE. 

Hold Nagarjuna Construction with stop loss of Rs 45, says PK Agarwal of Bonanza Portfolio, on Zee Business. It has resistance at Rs 55, he adds. The stock is currently trading at Rs 52.75, up 0.9% on the BSE.  

Both investors and traders should sell Kernex Microsystems on rally, says Anil Singhvi, market expert, on CNBC Awaaz. The stock is currently trading at Rs 94.30, up 10% on the BSE. 

Go long on Power Grid with target of Rs 105, says Ashwani Gujral, technical analyst, on CNBC TV18. Keep stop loss of Rs 85, he adds. The stock is currently trading at Rs 93.95, up 3.4% on the BSE.  

An hour into opening, the market continues to hold on to its morning gains with rail stocks buzzing ahead of the rail budget announcement. Sensex is trading at 9631, up 165 points from its previous close, and Nifty is at 2944, up 50 points. CNX Midcap index is up 1.3% and BSE Smallcap index is up 1.5%. The market breadth is strongly positive with advances at 832 against declines of 219 on the NSE.  

Hold BHEL, says Ashish Kapur of Invest Shoppe, on CNBC Awaaz. New investors can buy on dips, he adds. It is a fundamentally strong stock, he adds. The stock is currently trading at Rs 1454, up 3% on the BSE. 

Buy TCS at Rs 490 with stop loss of Rs 475, says Ramesh Arora, technical analyst, on Zee Business. It has resistance at Rs 530, he adds. The stock is currently trading at Rs 514.55, up 1.1% on the BSE. 

Buy BEML when it is available 5 to 7% down from its current levels, says Ashish Kapur of Invest Shoppe on CNBC Awaaz. The company's valuations are good, he adds. The stock is currently trading at Rs 411.80, up 4.3% on the BSE.  

Hold Texmaco which is fundamentally strong, says Ashish Kapur of Invest Shoppe, on CNBC Awaaz. New investors can buy on dips, he adds. It will give returns of 30-40% from the current levels. The stock is currently trading at Rs 62, up 7.1% on the BSE.  

Hold JP Associates with stop loss of Rs 61, says Ramesh Arora, technical analyst, on Zee Business. It has resistance at Rs 90-95, he adds. The stock is currently trading at Rs 75.60, up 3.5% on the BSE. 

Buy Aban Offshore at Rs 443 with target of Rs 461, says Simi Bhaumik, technical analyst, on Zee Business. Keep stop loss of Rs 434, she adds. The stock is currently trading at Rs 456.80, up 3% on the BSE. 

Buy Reliance Industries at Rs 1325 with target of Rs 1425, says Ramesh Arora, technical analyst, on Zee Business. Keep stop loss of Rs 1290, he adds. The stock is currently trading at Rs 1380, up 2.1% on the BSE.  

Sell Gail at Rs 214 with target of Rs 210, says Simi Bhaumik, technical analyst, on Zee Business. Keep stop loss of Rs 219, she adds. The stock is currently trading at Rs 216.75, up 1% on the BSE  

The market opens on a positive note with most of the heavyweights in the green. Sensex is trading at 9599, up 133 points from its previous close, and Nifty is at 2935, up 42 points. CNX Midcap index is up 0.9% and BSE Smallcap index is up 0.6%. 

Market may have flat to positive opening and may remain volatile as it is still moving within a narrow range, says Ashwani Gujral, technical analyst, on CNBC TV18. He sees support at 2830-2860 and resistance at 2960-2980. Markets are moving in a very narrow range and this range may break in either direction, he adds. He advises traders to go long on dips for intra-day gains as long as Nifty is trading above 2800.  

2800 Put buyers have been squaring up their positions, says Siddharth Bhamre of Angel Broking, on CNBC TV18. This is not the right time to go short or form longs, he adds. He advises investors to wait for 3000 level for creating shorts in the market. He finds RIL and ONGC weak.  

I think we can see some technical rebound in Asian markets today but however most of the markets have no clear direction, says Patrick Shum of Karl-Thomson Securities on CNBC TV18. I think the investors are waiting for further news from US side and also from Chinese Government, so I guess in the near-term most markets will continue to move within a range, he adds. 

We are positive on the market and may see a higher base after the recent consolidation, says Deven Choksey of KR Choksey, on CNBC TV18. The Nifty can gain 100-150 points if it manages to cross 2950, he adds. He expects continued focus on capex in the Rail Budget today and additional stimulus measures in the Interim Budget next week.