Jaiprakash Associates - Sell on rise

Jaiprakash Associates (Rs 103.9):

In our review of this stock in August this year, we had indicated that the medium-term range for the stock was between Rs 105 and Rs 170. Key medium-term support was, however, indicated at Rs 88. The stock is currently testing the lower boundary of this range. Investors can hold the stock with stop at Rs 85. Fresh purchases can also be made on a decline below Rs 100 with same stop. However, investors should stay away from this counter should the stock decline below Rs 88 for that would make the medium-term view negative, paving the way for a decline below Rs 50.

Medium-term targets for the stock would be Rs 130, Rs 150 and Rs 180. Long-term view for the stock will turn positive only on a close above Rs 210.

Source : Businessline.com

OUR RECOMMENDATION :

The scrip is finding good support around 100 levels and is finding it difficult to go through 170 levels. This present excellent trading opportunity to buy below 100 levels keeping a stop loss at 90 and exit at 165 which gives you an upside of 65% holding period of 9-12 months

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TA - JP Associates

Jaiprakash Associates (Rs 111.6): In our review of this stock in September 2008, we had indicated that the long-term outlook for Jaiprakash Associates had turned negative and that it could decline to Rs 93 or Rs 56.

The stock bottomed at Rs 47 on October 27, 2008 and had been moving sideways with a positive bias since then. Immediate resistances for the stock are at Rs 128 and Rs 146. Failure to move above these levels will result in a sideways move between Rs 60 and Rs 170 for a few more months.

Rally above Rs 170 will pave the way for a move to Rs 220. We do not envisage a move above Rs 220 this calendar year. If the stock manages to do so, next long-term target is Rs 320.

Source : businessline 19-04-09

Our Recommendation :
Our Research Team Views :

Day High Low Rs.122-107
Monthly High Low Rs.80-128
6M H/L Rs. 215-70

This share has risen sharply more than 90% in the last 2 months. The following  are the ideal ranges for buying and selling :

Buying Range : Rs.85-90
Selling Range : Rs. 115-125

Wait for the price to the buying range on correction in the stock markets.

Holding period : 6  months
Returns expected : 75% plus

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Cement: Beating expectations

Cement: Beating expectations

Shobhana Subramanian / Mumbai April 10, 2009, 0:18 IST

Over the last six months cement stocks have done rather well with the BS cement index up around 7.5 per cent compared with an upmove of around 4.6 per cent for the Sensex. Despite the Street’s anxiety that supplies would outstrip demand resulting in a fall in prices, nothing of the sort has happened as yet.

It may be the time to book profits on the cement stocks as they have grown more than 15% in the last one month or so.

On the contrary, prices remain firm and have actually edged up in certain pockets by as much as Rs 20 per bag. Cement despatches for the industry were up nearly 10 per cent in March while for 2008-09, it was 8.3 per cent indicating that while the real estate sector may not be using much of the commodity, there is undoubtedly a lot of construction taking place across the country.

However, analysts continue to be circumspect pointing out that while around 7 million tonnes of capacity was added in the March 2009 quarter, over 20 million tonnes is expected in the first half of 2009-10. This supply, they suspect, could dampen prices as producers try to protect their market share.

They conclude that by the end of 2009-10 prices could start trending down as more capacity is commissioned and as new and smaller players look to establish themselves.The recent run up in prices has left stocks a little more expensive given that earnings could come off this year. At Rs 530, Ultratech trades at 7.5 times 2009-10 estimated earnings while at Rs 587, ACC trades at just over 10 times estimated 2009 earnings.

Thumbs Down for Interim

Budget disheartens D-street;

Sensex ends over 3.4% down The 30-share BSE Sensex which belled on a negative note on negative global cues continued its bearish trend after the sixth interim budget failed to bolster investor confidence.

Interim budget 2009-10 announced today by minister of external affairs, Pranab Mukherjee, highlighted the state of economy and outlook for the future and said that the UPA kept the promises outlined in the Common Minimum Programme (CMP).

Asian stocks declined, led by finance and consumer companies, as Japan`s economy overshrank the most since 1974 and Group of Seven finance chiefs said the economic slowdown will persist through most of 2009.

The Sensex ended the day with a loss of 329.29 points, or 3.42% at 9,305.45 after touching a high of 9,637.04 and a low of 9,279.10. The broad-based NSE Nifty fell 99.85 points, or 3.39% at 2,848.50 after hitting a high of 2,953.20 and a low of 2,839.10.

BSE Midcap and Smallcap too ended on a negative note down 2.93% and 2.10% respectively.
All Sectoral indices also ended on a negative note led by Metal (4.75%), Realty(4.58%), Bankex (4.58%), Capital Goods (4.55%) and Oil and Gas (4.23%).
ITC which gained 0.75% was the only major gainer in the 30-share index .

On the other hand, Jaiprakash Associates (7.88%), Reliance Energy (6.35%), ICICI Bank (5.79%), Reliance Communications (5.78%), Tata Steel (5.20%) and Reliance Industries (5.17%) were the major losers in the Sensex.

Overall market breadth was negative. Out of the total 2,482 shares traded at BSE, 776 advanced, 1,598 declined while 103 remained unchanged.

Source: IRIS (16 February 2009)