My View On Tata Motors

About The Company

The stock has been fancied among the investor and traders being the leading stock in the automobile segment and leaded by the dignified corporate TATA Group.Though the stock has not been an exception to the severe correction in the market and the stock has been butchered as others.

About The Financials

The company has posted results for the second quarter ended 30^th September 2008, the marginal rise in sales and the sale of long term investments which helped shore up ‘other income’, to some extent, helped contain the fall in net profit due to the huge MTM forex loss of Rs.285 crore.

YoY, the net sales of the company for Q2FY09 showed a marginal 6% rise at Rs.7078.85 crore. Tata Motors’ total vehicle sales saw a decline of one per cent to 1.35 lakh units in current Q2. Volumes in passenger cars and utility vehicles slid from 51,618 units to 47870 units and this was on account of phasing out of old models of Indica. Its other income shot up by over 5 times and this was because the company had sold part of its long term investments, on which it made a profit of Rs.358.81 crore and this forms the chunk of the other income component. Its operating expenses rose 16% and interest outgo rose by 54%. Net profit was down 34% at Rs.346.99 crore.

Main Cues In the Stock

1. The slowdown in the automobile sector has been the sharpest and the financial performance of Tata Motors.

2. The coming quarters are expected to be tougher. After the September quarter, the going has only got tougher. Sales, which are usually at their peak during Diwali were no where near even normal. The pile of inventory had been so much that it had to shut down its commercial plant at Jamshedpur for 3 days and those in Pune and Lucknow for 6 days.

3. The company is grappling with the huge bill of the Jaguar, Land Rover takeover. The vehicle maker's plans to raise Rs.4150 crore via two rights issues in October were hit by a stock market slump, with the promoters themselves covering for most of the issue. Now their stake stands raised to 42% from 33%. Post-rights, the public shareholding in the company has come down to 45.8% from 51.75%.

4. Life Insurance Corporation, one of the large shareholders of Tata Motors, and Daimler did not participate in the rights issue. Post rights, LIC’s stake has come down to 9%, while Daimler’s has dipped to 4.5%.

5. There is also the issue of the shifting of the Nano from Kolkatta to Gujarat. Though the Gujarat Govt has bent over backwards to accommodate Tata Motors, the company itself will have to bear a huge cost on account of the shifting and the subsequent delay in launching the small car. The Tata group will invest Rs.2,000 crore to manufacture the Nano and its variants including an electric car and a CNG car. Naturally, the cost of all this will get reflected in the balance sheet on this fiscal.

About The Stock.

Though the long story remains intact but no good returns could be expected in near term.any buying should be made with long term prospective only.

Disclaimer : I do not have any personal holding in this stock.

My View On Gujarat NRE Coke

About The Company

The Company was incorporated on the 29th 1986 and was subsequently converted into a public limited company on 5th July, 1993. The Company was involved in trading activity after incorporation. The main object of the company is to manufacture and sell Low Ash Metallurgical Coke. However after taking up the project to manufacture Low Ash Metallurgical Coke with a capacity of one lac TPA, the company discontinued the trading activities. Gujarat NRE Coke, country’s largest independent producer of met coke.The promoters have hiked their holding in the company by 4.8% through creeping acquisition route during April-October 2008 and it now stands increased at over 45%. It is also going ahead with its plans for the rights issue with differential voting rights (DVR) to the existing shareholders of the company in the ratio of 1 DVR share for 450 existing equity shares at a price of Rs 1,000 per DVR share.

About The Financials

The company has posted results for the second quarter ended 30^th September 2008. The second quarter continues to reflect the boom it had in the prices of coke and coal but the coming months would not start reflecting the fall in their prices.For Q2FY09, total Income has shown a jump of 4.86 times from Rs.102.07 crores to Rs.496.05 crores, resulting in a surge of 8.19 times in the Net Profit, from Rs.12.55 crores to Rs.102.75 crores. This performance has been a foregone conclusion but what is important now is the coming months.

Like the fall in prices in almost all commodities, right across the board, coke prices have also seen a meltdown. With demand from steel and power units coming down, and globally also prices coming down, realizations for the company too have gone down. Coke prices have gone down by 21% from $700 a tonne in July-August to $500 levels now. And the fall in prices is expected to continue. This means that in the coming months, margins will come pressure and the earnings it has posted for Q2 would remain as history.

Positive cues in the stock

The main positive cue in the stock is that the company has sheer size and have its operations in Australia. The company’s present coke production capacity of 1.006 million tonne is being expanded in a phased manner to 1.254 million tonne and 2.254 million by 31st March 2009 and 31st December 2010. It is also the only company owning and operating coking coal mines in Australia and both mines are now in production. During the current fiscal the ROM coking coal production from its two mines is expected to be in excess of 1million tonne and brownfield developments are underway to ramp up the production to beyond 7 million tones by 2012/13.

About The Stock

The stock is sound and a very good investment opportunity.

Disclaimer : I Do not have any personal holding in this stock.My clients may have some position.

My View On Wockhardt

About The Company

One of the most renowned and fancied counter among the Health Care division.Its growth in USA has been good. It grew by 222% in the quarter backed by a 123% growth in the base US operations and the balance from Morton Grove. More than 60 products are now marketed in US. In European markets, UK leads the way with a 20% growth.

The management have serious concerns for research & development.During the quarter, the company spent Rs.13.90 crore on R&D, which was an increase on 19% on a YoY. The company for now, has postponed the demerger of R&D division into a separate unit.

About The Financials

The Company has posted results for the period ended 30th September 2008.Net revenue rose on a YoY for Q3 by 25% to Rs. 923.50 crore. Business in India grew 11% while international by 31%. Formulations grew by 26% while bulk by 11%. EBIDTA was up 17% at Rs.210.80 crore. OPM was at 22.8%. But the good story ends here. PAT was down 43% at Rs.62.20 crore. This was mainly on account of a MTM forex loss of Rs.55.30 crore. Interest outgo was also very high at Rs.48.59 crore as against Rs.26.80 crore in last Q3.

About The Stock

The stock touched a new low at Rs.100 and even now, it remains subdued at Rs.108.The stock doesn't seems to be attractive for a good investment opportunity.

Disclaimer : I do not have any personal holding in this stock.

Bad Deepawali For Automobile Industry

Negative Impact On Automobile Sales

This festive season was not good enough for the automobile industry to celebrate , instead they would like to have such Deepwali ever again whereby the sales figure went down breaking a 8 years records. Sale of cars fell 14.42% in October. According to the Society of Indian Automobile Manufacturers (SIAM), car sales in the domestic market went into reverse gear in October with a 6.59% fall to 98,900 cars against 1.05 lakh in the same month last year. Motorcycles sales were down 18.17% to 5.38 lakh against 6.57 lakh last year. Similarly,Trucks and buses sales fell 50% to 11,786 vehicles from 23,352 during the same period. The negative sales in October pulled down the cumulative sales growth in the current fiscal to 5.64% for the April-October period from 10.07% growth in the April-September period.

Positive Growth Sector

Scooters and passenger three-wheelers were the only two segments that posted positive growth of 4.4% and 16%, respectively. Exports also grew 41.16% to 1.44 lakh in October against 1.02 lakh the same month last year.

Companies Participating In Fall Of Sales Figure

Market leaders has posted a significant fall in sales including Maruti Suzuki India, whose sales fell 6.4% in, while sales of Tata motors the second-largest passenger car maker, declined 6%.

Companies Shown Growth In Sales figures

Hyundia Motors India has posted a rise in sales by 9.91% in October while GM also posted 25.33% increase in sales.Toyota Kirloskar Motor increased sales on the back of its new premium sedan ‘Corolla Altis’ to 1,110 vehicles in October over 526 sold in the same month last year.

Reason Behind decline in Sales

1. Rise In interest Rate Of Auto Loans

2. Fall In Capital Market.

3. Overall Slowdown In All business sectors including metals , Plastic etc.

4. Rise in Rate of unemployment by increasing termination of employee from corporates.

5. Higher Inflation Rates.

Future Of Automobile Stocks

There is bit tough time ahead for market leaders of this sector but we had to see the steps taken to overcome the situation. Meanwhile any such stock should not be traded in excessive quantity for investment or for delivery trading.

Disclaimer : I do not have any personal holding in this sector.

My View On SESA GOA

About The Company

The company is a part of the Vedanta group and the largest private sector iron ore exporter of India.With the application of the Companies Act 1956, to Goa, it was incorporated under the Act on 25th June 1965, as a Private Limited Company under the name Sesa Goa Pvt. Ltd. It was wholly owned subsidiary of Istututo per la Recostruzion Industriale, an Italian Govt. controlled company.

In April,1979 another wholly owned subsidiary of Finsider S.P.A., Italy was also engaged in the mining and export of iron ore. Mingoa Pvt. Ltd., was amalgamated with the company. As per the Scheme of Amalgamation, 38,500 No. of equity shares of Rs 500 each were allotted to Finsider S.P.A., Italy without payment in cash.

The Company was converted into a public limited company on 25th March 1981.

About The Financials

The company has posted results for the quarter ended 30^th September 2008, its consolidated net sales was up 129% at Rs.875.7 crore on YoY. OPM had improved to 48% as against 33% in Q2FY08. PAT was up by a jaw dropping 262% at Rs.336.6 crore. This is a very good performance as traditionally, Q2 is the lean period for the company as monsoon affects volumes. Yet it managed a very good show, indicating that demand was high and the sector was yet to cool off.

During current Q2, iron ore sales were 1,389 million tonnes which was 74% higher than Q2FY08 while saleable ore production was up 39% at257 million tonnes. Metallurgical coke sales price realization increased substantially. Pig iron production was higher but sales volume took a hit due to price volatility. The positive impact of higher volumes and price on profit margins was partly offset by increase in logistics costs and export levy duty.

The sector has now started signs of cooling down and the company is bound to see this reflected in its profit margins in coming quarters. Iron ore prices are falling everyday and the bounty, which the company reaped in the first half will not get repeated in the second half.

About Company Plans of Expansions

Over the next 7-8 years, the company hopes to have a capacity build up of 100 million tonnes but it hopes to build it to 25 million tonnes over the next 2-3 years. Though the company is not expecting major demand contractions in the current fiscal, it’s realizations are sure to come down,so some fall in margins in H2 is expected.

About the Stock

The stock has been available at attractive price and could be accumulated at every fall for medium to long term prospective.

Disclaimer : My clients may have some position in this stock.

A Big Merger : HDFC WITH HDFC BANK

The current economical position in India & world wide has forced the big corporates to take necessary actions immediately in order to protect there survival and at least maintain its existence. Different modes are being adopted to encounter the problem among which we are seeing the merger being one of the fancied option , which helps to reduce the cost remarkable and provide support for both individual entity agreed to be merged.

Deepak Parekh, chairman, Housing Development Finance Corporation (HDFC) has indicated a possibility of merger of HDFC & HDFC Bank in near future. Though he has not given any time frame, the very fact that he is even considering this in itself is very big news.

HDFC is the leading home loan provider of India and hence it becoming a part of HDFC Bank seems far fetched now. But if HDFC becomes a part of HDFC Bank, then it will make HDFC Bank the largest private sector bank of India, surpassing ICICI Bank. If that is the objective, then probably we could see HDFC Bank emerging from the merged entity.

We need to see how do the stock of both HDFC & HDFC Bank react to it.

My View On Automobile Sector

About The Current Scenario

The current slowdown in Indian economy is affecting one sector after another. Recently we have noted the significant fall and problems in Aviation and cement sector .The next sector which has come up with major difficulties is automobile sector with a remarkable fall in sales figure due to higher interest rate, reducing IIP numbers , and slowdown in overall business.

The slump in the auto sector seems to be getting tougher. The lack of auto financing, which is how 95% of the people buy vehicles has been one of the biggest reasons why auto companies are in the state in which they are today. Fall in demand is leading to a huge build up in inventories and this is exerting further pressure on the already harassed companies.

Impact Of slowdown

1. The big corporates find difficult ways ahead at least for there survival.

2. Huge job cuts are increasing the figures of unemployment. Most of the workers under temporary placement has been terminated while new admission has paused.

Measures Adopted By Companies for Survival

The companies are opting to reduce there manufacturing capacity of plant to balance the sales figure with production and to avoid any overproduction. Either they are reducing the manufacturing capacity or they opt for keeping there plant close for a specified period of time to control the variable cost.

Ashok Leyland is planning to reduce monthly production target for November to 1,500 units from the average of 6,800 units it clocked each month in the first six months of this fiscal. In November, the company will also work fewer days to match with the production schedule.

Tata Motors is also not unaffected. It has shut down its Jamshedpur unit, the mother plant for its commercial vehicles, for three days, starting from today till Nov 8, 2008. Both the companies hope that by using these tactics, it will be able to avoid building up of inventory – both with the company and also with the dealers.Tata Motors in October reported a 29% fall in commercial vehicles sales at 19,154 units. HCV and MCV sales were most hit with a 48% fall as they are mostly always financed with loans. It also 'disengaged' 700 temporary workers from the Jamshedpur plant. For the common man on the street, survival is becoming a task.

My View On Hero Honda

About The Company

The Company was Incorporated on 19th January,1984 at New Delhi. The Company Manufacture motor cycles upto 100 cc capacity. The Company was promoted by Hero Cycles (P) Ltd. (HCPL).

The Company entered into a technical-cum-financial collaboration agreement with Honda Motor Co. Ltd., Japan (HML). As per this collaboration agreement, HML was to furnish complete technical information and know-how and trade secrets and other relevant data.Thereafter the company was titled as Hero Honda.

- Hero Honda CD-100 is the first four stroke motorcycle to be introduced in India in 100cc range. Its most attractive features are fuel efficiency and its light weight. CD-100 will be equipped with electronic ignition system, illuminated speedometer, 4 speed gear box, neutral and flasher indicators, etc.

About the Financials

The company has posted a very good result for the quarter. Its total turnover (Net sales & Other Operating income), YoY, grew 36% at Rs.3202 crore. Total sales for Q2 stands at 9,72,095 units, growth of 28.5%. Net profit showed a healthy growth of 50% at Rs.306.30 crore. It currently has an enviable market share of 55% in the Indian domestic two wheeler industry. This improvement in performance comes on the back of falling demand, rising interest rates and overall negative sentiments. Hence the improvement, despite all this, comes as a shock more than a surprise.

Hero Honda's cumulative sales for the first six months (H1) stands at 18, 66,339 units of two-wheelers compared to 15, 59,486 units sold in H1 in the last FY – reflecting a consistent 19.7 per cent growth in cumulative sales.

The Highlights of the Counter

1. The company has completed 25 years of excellence in the Indian Markets.

2. The company plans to double production to 4,000 units at its Haridwar plant beginning next fiscal.

3. The 100 cc bike market comprises two third of the two-wheeler motorcycles sales of Hero Honda’s, reflecting the trend of the industry.

About The Stock

Though the stock has been badly hit in this extreme fall but as the fundamentals remains good so one can hold on this counter and could opt for partial fresh investment.

Disclaimer : I do not have any personal holding in this stock.

Impact On Cement Industry In India

About The sector

All sectors are interlinked to each other , they have relationship such that effect in one sector has an immediate and appropriate reaction to the linked sector. As we see fuel price has inverse relation with the sale of cars.Any significant rise in fuel price will slowdown the figure of sale in automobile sector. Likewise cement sector has direct relation with the real estate, which has taken the worst hit and the way prices have tumbled and yet, there being no buyers is an indication of the plight of the sector. This fall in realty has led to fall in the demand for cement, which is expected. And the inability of the cement companies to now pass on any input cost rise to the consumers is expected to take a further toll on their bottom lines. Though net realizations were up in the second quarter, it is expected to come down sharply in the current quarter.

No Immediate Solution

The way to cope up with the reducing demand in domestic market due to slowdown in reality sector by shifting there concentration towards export would also not go through as this time we had a global slowdown.

Other problems.

1. The cement sector is expected to face a situation of oversupply as most of the expanded capacities.

2. New facilities would all go on stream by next fiscal.So apart from falling demand which has softened the prices, the situation of glut could further exert pressure on the prices. So the bottomline – tough times ahead for cement companies.

About The Cement Stocks

As we see a tough time for the sector ahead , so any better expectation from the cement companies would be a bad idea.

My View On Areva

About The Company

The company is a well managed with balanced plans and system of expansion. Instead of global weakness and shortage of liquidity the company has managed to maintain a balanced growth and has good expansion plans

About The Financials

Areva T&D India Ltd for the third quarter ended 30th September 2008 . The company's net sales rose 35.57% on a YoY to Rs 586.46 crore. Operating profit grew by 11% at rs.85 crore. Profit after tax of Rs 52.31 crore for the quarter was up by 8.89%.During the third quarter, the company made significant additions to its customer list and secured major contracts from Bhilai Steel Plant worth Rs.221 crore.

Cues On the Stock.

1. Areva will provide the transmission and distribution services to the steel plant.

2. The power company will also supply substations to the steel plant and revamp its existing substations. The company expects to complete the project by October 2010.

3.It also got an order from RRVPNL Hybrid substation and distribution transformers for wind energy segment, a first for the company.

4. Expansions, with six new factories at three greenfield sites at Baroda, Hosur and Chennai Padappai ready for production by March 2009.

About The Stock.

The company is good for medium to long term prospective as its planning of expansion and future development remains good.

Disclaimer : I do not have any personal holding in this stock.

How To Make Money Now ?

The upcoming time would be worse then what we had faced right from the beginning of 2008.In the new year there would be more bad news with greater pace arriving without any solution for short to medium term.

We are busy with our losses in capital market but a bigger curse is left out to come , which is ultimately the effects of severe fall in Indices. Lets focus on them :

1. There would be overselling in reality sector leading to extreme fall in prices of property. Though the prices of constructed flats and offices would be more effected then open lands.This fall would be backed by two reasons namely, first The investor to pay off there debts due to loss in stock market would sell out there investments in property. Second There would be no new buyers for upcoming residential complex as investor ould not be left with surplus to invest there money.As the need user consumption in reality sector is limited so it will lead to oversupply and ultimate fall in prices.We should not be shocked to see the repetition of prices before 1-2 years ahead.

2. The Luxury products sale figure will fall drastically including Diamond Jewellery , Luxury Cars ( Sedan) expensive and luxurious products. High rent hotels , Electricals good will be also under its coverage.

The ultimate solution at present times for investor with cash in hand:

Being a stock advisor and financial advisor I would suggest to be in cash or invested in segment which is as good as cash like Gold , Silver & Fixed Deposit , which is offering a handsome & assured return. Though due to RBI policies these rate may cut in upcoming times.

We will have to click to the opportunity to get the best deal. If you are with cash at that time you will be able to en cash the opportunity without facing any financial difficulties. I would guide to pick the best stock among the variants at the time market is going to bounce back to get the maximum revenue enough to make up our recent losses and attain average gains for the period we had spent
without any profits.

To get my tips on multi bagger picks you can register with me. To Register email at: ommansarovar@sify.com

My View On Hotel Leela

About the Company

The Most Fancied stock of hospitality sector is facing tough times because of the slowdown in economy.The rising costs and the way people have cut down on their spending would get reflected to a large extent on the hospitality industry. With most of the companies going on an austerity drive and cutting costs, hotels are the biggest sufferers. The cut down by corporate clients becomes first evident in the financial performance of the hotels.

About the Financials

The Company has posted results for the second quarter for the current fiscal ended 30^th September 2008.If the performance was flat in Q1, it has fallen in Q2.Net sales rose on YoY by a meager 9.35% but the burgeoning costs, which rose 46%; depreciation which was up 37% and MTM forex loss of Rs.9.30 crore, all took its toll. PAT fell by 40% at Rs.24.05%. The fall in the margins has been sharper. OPM fell from 64.82% to 44.23% and NPM fell from 40.06% to 21.96%.

Plans Of Expansion

Its new hotel at Udaipur is scheduled to open in current Q3. And the one in Gurgaon, is to open by end of October or early November. Its hotel in Chennai is expected to open by September 2009.

About The Counter

The time ahead remain bad for hospitality sector. The current fiscal is expected to remain tough and even being able to maintain these levels could become a task. It is advised to stay away from the counter as we do not find good return in this sector in short to medium term prospective.

Disclaimer: I do not have any personal holding in this stock.

My View On ITC LTD.

About The Company

The established brand has diversified business including Paper , Hotels , Cigarette , FMCG etc.The stock of the company has not performed in the recent rally in comparison to other front line stocks.This stock has been included in heavy weight stock category in both the exchange namely BSE & NSE due to its high market Capitalization and strong base of the company.

About The Financials

The company has posted the results for the second quarter ending 30/09/2008 a 15% rise in revenue, pre-tax profits at Rs. 1189 crores registered a subdued growth of 4.9% over the same period last year. Post tax profit at Rs. 803 crores grew by 4.1%. Steep increases in commodity prices and store rentals, the brand building costs of the new Personal Care portfolio and the significant investments in enhancing distribution capability combined to exert intense pressure on profitability during the quarter. Cigarette major, ITC once again faced the brunt of the higher tax it had to dole out on cigarettes. The ban on non-filter cigarettes also did not help matters.Net Turnover at Rs 3763 crores registered a growth of 15%.The main growth propeller was non-cigarette FMCG business, comprising packaged foods, garments, stationery, matches, incense sticks and personal care products, witnessed a 30% growth in revenues. The paper and packaging business suffered a drop of 3% due to rise in prices of pulp and waste paper. The company’s hotel business, too, suffered due to the slowdown in the economy and a decline in the travel industry. Its agri business revenues grew by 17%, driven by a growth in leaf tobacco exports. The leaf tobacco crop from Andhra witnessed an unprecedented spurt in prices with rates increasing by more than 80% on the back of demand supply mismatch.

The Govt’s ban on smoking in public places too will have an effect on the bottomlines of the company in the coming months. With so many businesses of ITC, one wonders why ITC remains in cigarettes despite the atmosphere for making cigarettes being non-conducive. The company has explained that it has ventured into FMCG to dilute the effect of cigarettes but it would stick to the cigarette business since it was legal and provides resources required to enter new businesses in future. The company will be able to maintain its performance in the current circumstances only if its able to increase the share of its non-cigarette businesses.

About The Stock

Due to overall bad sentiment in the market the stocks is showing new lows and providing a great opportunity to get into the stock at most reasonable price.

Disclaimer : I do not have any personal holding in this stock.

My View On SBI

About The Company

The biggest bank of the country , India with widest network of branches & ATM's across the country . The bank is a Public sector bank and other bank could not even imagine to be half of the total network of the SBI.

About The Results

The bank has posted the better results for the second quarter ended 30^th Sept 2008. On a standalone basis, net income was up, on a YoY by 40.37%. Interest earned stood at Rs 15566.50 crore against Rs 11616.28 crore previous year while interest expended was Rs 10111.15 crore against Rs 7853.36 crore same quarter last year. Net profit was up 40.23% at Rs 2259.72 crore.

On a consolidated basis, total income of the bank increased by 26.41% to Rs 27,083.47 crore. Its net profit grew 11.50% at Rs.2458 crore. Interest earned was Rs 22568.05 crore against Rs 17058.28 crore in 2007. Interest expended was Rs 15049.33 crore for the quarter ended Sep 30, 2008 against Rs 11783.16 crore in 2007. Increase in the lending rates helped SBI shore up its bottomlines.

About The Stock

PSU banks are better off today in the global meltdown scenario as their exposures are minimal. There has been a sell off on all bank counters but the brunt of the sell off faced by private sector banks has been harsher. SBI touched a new low at Rs.991. From valuation point of view the stocks seems to be most attractive in banking sector but we need to see how much pain is yet left in the Index as a whole before investment.

Disclaimer: I do not have any personal holding in this stock.

My View On Empee Distilleries

About The Company

As the name suggest the company is engaged in distilleries business.The promoters may not seem unreliable though they may be incapable. The present market of the company is close to Rs.135 crores and even after considering debt of close to Rs.50 crores, it works out to less than Rs.200 crores. Considering the presence of company in Tamil Nadu and Kerala for its breweries business as also expansion in Karnataka and Andhra Pradesh, share price seems to be ruling way below its fundamentals and intrinsic worth.

About The Results

The Company has posted somewhat better results for first quarter ending 30-09-08 with an EPS of Rs.3.01. For nine months ending 30-06-08 the EPS of the company was placed at Rs.5.94, with total income at Rs.564 crores and net profit of Rs.11.30 crores. For Sept. 08 quarter, the total income is at Rs.246 crores with net profit after tax of Rs.5.72 crores.

The company is expected to have a net profit of close to Rs.450 crores from its realty division by FY 10, but the same is not visible in the performance, as the company had already presented accounts for 15 months, post public issue.

About The Stock

This is one of those issue which present a false picture in front of the public with sole motive to get there business financed by public money and take home there investment. This is possible only during a stro0ng bull market when sentiment of public is high and they overlook the prospectus of the company , which is designed by the experts. If the company has the potential then why no IPO's are offered in this market and why all proposed IPO's are canceled ?. These sort of company get delist with no ISIN umber once the market moves under bear market , you wouldn't find there existence in next bull run. The expected annualized EPS for FY 09, of Rs.12 is discounted by about 6 times. This is probably the lowest PE multiple given to the company in its segment, considering its mid cap size.This is due to betrayal of investors confidence in the company and its promoters for the promises made by them, post public issue, which were not achieved by them. Also, hefty issue price of Rs.400 per share added woes to the wounds.Share is now ruling at Rs.70 against its all time low of Rs.64 and issue price of Rs.400 per share. I strongly recommend never to invest in such companies.

Disclaimer : I do not have any personal holding in this stock.

GOLD & SILVER : BEST OPPORTUNITY IN THE MARKET

Present Scenario

In this havoc , when the entire global market is heading towards recession and its a scene of discomfort and fear people are finding very difficult to trace a right place to invest there hard earned money , which in turn would not only give them handsome return but also assure the principal amount to be safe and secured. The stock market has stumble down not only in domestic but in international markets also. After number of generous effort from the financial bodies of the country including RBI , SEBI and the Finance ministry very insignificant results have been noticed and that too for a very short period. The market is facing difficulty to find the way ahead and get support at least not to decline further. The portfolio of the traders and investors are declining to vast extent day by day , whether we realize them by booking our losses or not is a secondary factor. In this scenario investors have not only lost the unredeemed profits but the invested capital has been washed off badly , moreover the remainder is stuck for a infinite period of time. This lead to credit crunch and shortage of liquidity in the market, thereby sole cause of financial instability of the country as a whole. In circumstances as such of failure of financial Institutions & big corporates , rise in figures of unemployment & inflation.After severe steps from govt. to improve liquidity in the market , no significant results are found that is leading us towards a dangerous situation ahead as United states of America.

What to do now?

In the above mentioned situation its tough to track the path to invest and keep them secured. The only way to be secured is to invest in precious metal , which is acceptable worldwide. These metal include GOLD & SILVER. Even though the currency is not valid or not acceptable in some parts of the world but these metals have international values. In a situation when the country gets bankrupted the currency gets value less but the gold is the only base for the public of that country to have financial health. The currency of any country is printed on basis of gold reserve or else one would have printed as much as money required but that is restricted to amount of gold deposited. When the reserve gets nil the value of currency of that country gets zero. In a situation of financial crisis the steps is considered as first a deep cut in stock index of that country, secondly sale of gold , sale of property respectively.

GOLD & SILVER has very bright future ahead and will make new life time highs. There may some depression due to international crisis and sale of gold from the country moving towards deep recession to make financial stability for time being , but it has provided a great opportunity for us to invest but for long term view , its best investment opportunity.

Being a financial advisor I would suggest to rush to accumulate gold. Some lower level may be seen but it may turn around from any levels. The maximum low expected is Rs 8000 per 10 gms but It may be a dream value , as it has strong support at higher levels. The best way to invest would be to start buying from current levels and average. In case you wish to go for 100 gms buy 25 gms in 4 times , at every dip to average your purchase.

My View On Cummins India

About The Company

Cummins India is the largest engine maker of the country. The stock has not been popular among the investors.The margins has been reduced but considering the present trend of margin pressure being faced by capital goods manufacturers, this kind of erosion in margin pressure is acceptable and understandable. The rise in topline is quite healthy, which gives a lot of confidence to the investors for future performance of the company. One can safely assume a growth of 35% in topline while a rise of 30% in bottomline for FY 09 and FY 10.

About The Financials

The company has posted good Q2 results with topline rising to Rs.808 crores (Rs.540 crores in corresponding quarter of previous year) registering a growth of about 50%. This can definitely be termed as an excellent growth considering the situation prevailing in capital goods, automobiles and manufacturing sector. PBT also risen by about 42% to Rs.128.95 crores against Rs.91.10 crores. Net profit also rose by 41% from Rs.66.48 crores to Rs.93.82 crores resulting in an EPS of Rs.4.74 for the quarter against Rs.3.36 of Q2 FY 08.The growth has been linear and H1 of FY 09 had a topline of R.1,540 crores (Rs.1,095 crores) with PBT of Rs.250 crores (Rs.180.45 crores) and PAT of Rs.182 crores against Rs.130 crores of H1 FY 08. EPS is placed at Rs.9.20 against Rs.6.59 for first half of FY 09.It may get noted that the EBIT margin has slipped to 13% for the quarter against 14.60% of the corresponding quarter in the previous year. And this reduction of 1.60% is instrumental in fall of bottomline relatively lower than the topline growth.

About The Stock

Though the stock price is correcting due to down trend in market but the performance of the company is good and could be considered while selecting stock for investment.

Disclaimer : I do not have personal holding in this stock.

What About Index Levels next?

Very long back , I had declared to my followers that the time ahead is very astonishing and the levels are unexpected. As per elliot wave analysis I had explained the cycle of bear phase in March '08 itself that whenever market enter in this cycle , which is confirmed at this point of time we use to see the following symptoms:-

1. 45% - 60 % cut from the highest point of the Index.

2. After bottoming, the Index consolidate for a period.

3. A scam or particular stock in which operator work will be best hammered. As in 1992 Harshat Mehta fall ACC cement was the culprit. In 2000 Ketan Parik Severe Fall in Technology pack was aimed and in this 2008 we target Reliance pack & Larsen.

4. Those stock which drive the stock in a particular rally get worst hit and in next rally they remain apart from the stock which drive the Index.As 1992's ACC is consolidating yet and 2000's Technology pack failed to perform in the recent rally instead they were busy making new lows during the rally when other stocks were outperforming.

Note :

1. To get answer of the following queries:-

a. When & Where will Index Bottom out?
b. Till when will market consolidate?
c. When will next rally begin?
d. Which sector will now participate in the next rally?


======NON registered member can register to get availed of the answers.
TO REGISTER EMAIL AT : ommansarovar@sify.com

My View On Ponni Sugars (Erode) Ltd.

About The Company

Ponni Sugars is a small company in its field but the management is doing well.ICICI Bank Limited has withdrawn their Nominee Director, Mr K J Rajasimha from the Board of Directors of Ponni Sugars and nominating in his place Mr. Manas Ranjan Pani as their Nominee Director.

Its current results throws a light on the expectations of other sugar results.It may be noted that sugar prices were firm during July – September 08, quarter and hence all the companies are going to present healthy results. However, from mid September, sugar prices have started softening and the trend is likely to remain the same till end of calendar year, as crushing season would be starting soon in Maharashtra and U.P. But due to lower production of about 20 million tonnes expected in season 08 – 09, sugar prices would rise form March 09.

About The Results

Total income of the company during the quarter is at Rs.33.76 crores against Rs.40.26 crores in the corresponding quarter of previous year. PAT for the quarter is at Rs.3.10 crores (against a loss of Rs.2.39 crores) and a net loss of Rs.1.88 crores in FY 08. This is after booking Rs.1.65 crores, being increase in cane price, effective from 1^st October 07.During the quarter, the company issued 40 lakh equity shares at Rs.50 per share, by converting preference share capital, due to which paid up equity of the company rose to R.8.60 crores.EPS of the company for the quarter is at Rs.3.64 while for H1 of FY 09, it is at Rs.2.50. This is because; the company had its bottomline in red for June 08 quarter, at Rs.1.02 crores.

About The Stock
The stock is trading near its 52 week low.Though the stock is small in its sector but if sugar sector leads the rally the stock has the capacity to reward there stake holders.

Disclaimer : I do not have any personal holding in this stock.

My View On Biocon

About The Company

Biocon is well renowned company of the pharmaceuticals sector and hold significant position in its field.For long term investment this counter is always counted to be part of the portfolio.The resulted posted by the company is not satisfactory and forcing to have second thought regarding investment in this stock.

About The Financials

Results for Sep 2008 shows EBITDA margin in pharma segment plummeting to 25.95% from 37.11% of Q1 FY 09. The dent on profitability has been due to rise in raw material costs from 43% of net sales in Q1 of FY 09 to 53.50% in Q2 of FY 09.Total income of Biocon during second quarter ending Sept. 08 was at Rs.442 crores against Rs. 279 crores of the corresponding quarter in the previous year. However, Q2 FY 08 includes the workings of its enzymes business, which was transferred to third party, effective from 01-10-07. Hence, it is appropriate to compare the results of the company on sequential basis.

Net sales rose to Rs.439.30 crores in Q2 from Rs.263.93 crores in Q1 of FY 09. Inspite of this, profit after tax but before exceptional items, has been flat at Rs.49.84 crores against Rs.48.55 crores of Q1. After forex losses provisions of Rs.25.45 crores during Q2, PAT was placed at Rs.25.02 crores against Rs.15.04 crores of Q1.

The company has issued 1 : 1 bonus on 15-09-08, due to which paid up equity of the company increased to Rs.100 crores. This has resulted into an EPS of Re.1.25 for the quarter while it is at Rs.2 for first half of FY 09.

About The Stock

The stock is near top its 52 week low but the pressure on margins may drown it further. The stock is expected to correct more because of the disappointing results.Fresh investors need patient to invest in this stock.

Disclaimer : I do not have any personal holding in this stock.

What Levels For Index Ahead?

Very long back , I had declared to my followers that the time ahead is very astonishing and the levels are unexpected. As per elliot wave analysis I had explained the cycle of bear phase in March '08 itself that whenever market enter in this cycle , which is confirmed at this point of time we use to see the following symptoms:-

1. 45% - 60 % cut from the highest point of the Index.

2. After bottoming, the Index consolidate for a period.

3. A scam or particular stock in which operator work will be best hammered. As in 1992 Harshat Mehta fall ACC cement was the culprit. In 2000 Ketan Parik Severe Fall in Technology pack was aimed and in this 2008 we target Reliance pack & Larsen.

4. Those stock which drive the stock in a particular rally get worst hit and in next rally they remain apart from the stock which drive the Index.As 1992's ACC is consolidating yet and 2000's Technology pack failed to perform in the recent rally instead they were busy making new lows during the rally when other stocks were outperforming.

Note :

1. To get answer of the following queries:-

a. When & Where will Index Bottom out?
b. Till when will market consolidate?
c. When will next rally begin?
d. Which sector will now participate in the next rally?


======All my registered members can mail me and get there answer.


======NON registered member can register to get availed of the answers.
TO REGISTER EMAIL AT ommansarovar@sify.com

My View On ICSA

About The Stock

The company has presence in energy solution provider, which continues to remain a growth area. However, in the time of crisis, market has started suspecting everything including financial results and FII stake. This implies confidence crisis, which is not encouraging anyone to go for investment in the stock.Taking a call on the results as well as sector, one can expect the company to continue to show better results, which needs to be positively received by the market.

Concern In the Counter

The concern has been with FII stake in the company, which is on a declining trend to 47.77% as at 30-09-08 against 50.40% as at 30-06-08. However, a positive for the company is conversion of its FCCB, as, out of FCCB of US $ 46 million, US $ 25 million were converted and US $ 21 million are remaining outstanding as at 30-09-08. Considering expected annual profit of over Rs.100 crores, for FY 09, the present outstanding FCCB of about Rs.100 crores is not an area of concern.However, market is expecting divestment of stake by FIIs and low promoters stake of about 18%, in the company, creates further weakness.

About The Financials

Results for quarter ending September 08, with total income rising by about 86% to Rs.279.61 crores from Rs.149.83 crores of corresponding quarter in the previous year. Even on sequential basis, growth in topline is by about 16%. Similar is the case with its bottom line, which rose by about 66% to Rs.48.03 crores from Rs.28.88 crores of Q2 FY 07. EPS for first half of the company is at Rs.20, which would be close to Rs.40 for FY 09. This results in a PE of close to 5 times, which makes the stock reasonably priced.

About The Stock

On 10-10-08 it had a new low of Rs.138 with high volatility with share bouncing back to Rs.232 on 14-10-08. Higher volatility is a risk factor so I do not recommend the investor to involve in this stock.

Disclaimer : I do not have any personal holding in this stock.

My View on RS Software

About The Company

The company belongs to software group.Though the size of the company is small and the sole aim of the company is to create sensation by publishing its quarterly results with blocks of “Net Profit up 100 times” etc. The sole aim of the promoters of the company are to have market operations and to trap the investors at the higher levels.

About The Financials

The result for the second quarter ending September 08, wherein PAT of the company of Rs.178 lakhs for the quarter, far exceeds PAT of FY 08, which was at Rs.117 lakhs.There seems to be no correlation between the profitability over the quarters, as also in regard to EPS stated by the company, for various periods. For FY 08, on equity base of Rs.744 lakhs, with PAT of R.117 lakhs, EPS is stated at 16 paise, while for September 08 quarter, on PAT of Rs.178 lakhs, EPS on equity of Rs.744 lakhs is stated at Rs.2.18.

About The Stock

Share now ruling at Rs.18 had its 52 week high low of Rs.52 and Rs.15 and when established mid cap I.T. companies are available at a PE multiple of 3 to 4 times, who would be interested in these manipulative stocks.I do ot suggest to make any investment in this stock.

Disclaimer : I do not have any personal holding in this stock.

Taxation Rules For Gold Jewellery

Whats the taxation rules for GOLD?

Any profit on transaction of gold is considered under the category of capital gains.

How Can we know whether it is long term or short term capital gain?

Gold ornaments held for a period of more than 36 months are long term capital assets and attract long term capital gains (LTCG) tax. If held for less than 36 months, then they are short term capital assets and attract short term capital gains (STCG) tax.

How to calculate LTCGT?

Long Term Capital Gain Tax = (sale price of ornaments - Indexed cost of acquisition)x 20%

What is indexed cost of acquisition?

The tax laws allow you to take the benefit of rising prices or inflation. That is, your original purchase price will be adjusted to current prices. That way, your inflation adjusted gains will be lower than the absolute gains.

My View On Prism Cement

About The Company

Though the company belongs to cement sector.The main culprit for this dismal performance has been fall in realizations as well as rise in energy bill.Due to old plant, the company is incurring an annual expenses of Rs.100 crores, which is taking a tool on its profitability.

About The Financials

Prism Cement had posted c financial results for the first quarter ending September 08 with topline plummeting from Rs.193 crores to Rs.163 crores with EBIT falling to Rs.23.53 crores against Rs.67.76 crores in the corresponding quarter of the previous year. Expectedly PAT fell to Rs.15 crores against Rs.51.84 crores in the corresponding quarter of the previous year, which has resulted in an EPS of 50 paise only for the quarter against Re.1.74 of Q1 FY 08. On consolidated basis PAT is placed at Rs.13.17 crores translating into an EPS of 44 paise only.Though annual shutdown took away Rs.25.68 crores in the quarter the same was existing at Rs.19.22 crores in the corresponding quarter of the previous year.

About The Stock

The company is not expected to perform good in near future so present times do not suggest it to be a good investment opportunity.

Disclaimer : I do not have any personal holding in this stock.