Intraday Calls for 25th Feb

Market may see a gap up opening and a strong rally.

Buy for Intraday:

GMR Infra (176) Target 182-185 SL 173
Bank of Rajasthan (172) Target 178-180 SL 168
Jaiprakash Associates (246) Target 260+ SL 240
Info Edge (Naukri) (962) Target 1000+ SL 950
OnMobile (534) Target 550-560 SL 530
ENIL (478) Target 495+ SL 470
Mudra Lifestyle (52) Target 58-60 SL 50
GTC industries (475) Target 490-500 SL 470
Keep an eye on REL & RPOWER. Both counter can see smart gain today with gap up opening.

Good Luck

Reliance Power Bonus Ratio

Ratio of 1:1
If the company proposes to issue bonus in ratio of 1 : 1, and as stated above, share price may go upto Rs.500 per share. On ex-bonus basis, share price would correct to Rs.250 per share. This would increase the company’s equity capital from 226 crore shares to 248.80 crore shares, resulting into a market capitalization of Rs.62,000 crore, on post bonus, at Rs.250 per share. The present market capitalization of the company is Rs.92,600 crore at Rs.410 per share while it was at Rs.87,000 crore, at Rs.385 per share, at which it closed before bonus announcement. So, management would not be too keen to go for this ratio.

Ratio of 1:3
If ratio proposed is 1 bonus share for every 3, this would be definitely below market expectation, and can see share price sliding below Rs.400, which would defeat the basic purpose and objective of the management, for which management may not take risk and chance. Even if it is presumed that it is accepted by the market and share price remains at this level, shareholders would not get compensated. Prospects of share price crossing Rs.450, is remote with this ratio.

Ratio of 1:2
If ratio of 1 bonus share for every 2 share is proposed, share price has chances of moving to Rs.450, which would result in share price ruling at Rs.300, on ex-bonus basis. In this situation, the objective of bonus issue shall get achieved and market capitalization of the company would also be at Rs.71,000 crore as post bonus equity of the company, would rise to 237.40 crore equity shares.

Those shareholders, holding shares of RPL on record date, would be the only one’s eligible to receive bonus share and record date is not likely to be on or before 31st March, 2008. So, original investors of IPO, having sold and booked losses, will not be able to make good their losses or stand to gain from the proposed bonus issue.

Also we wish that no legal hurdles comes in the way of this bonus, as it is issued only to non-promoter category, inspite of the entire share capital of RPL being pari – passu. Since, Reliance Energy (REL), a listed company of the group is also a promoter, presently holding about 45% stake, any shareholder of REL can challenge this move of excluding promoters from bonus entitlement, inspite of all shares being pari – passu.

Under any situation, share price would not cross Rs.500 and may not fall below Rs.400, per share, on cum-bonus basis.

Source: sptulsian.com

Intraday Calls for 22nd Feb

Market may go South at the opening but recovery to the North expected later.

Buy for Intraday (Buy at lower levels with tight SL):

Prithvi Info (269)
Trigyn Tech (25.75)
Tech Mahindra (698)
KPIT Cummins (88)
GMR Infra (184)
JP Associates (259)
HDIL (825)
RPOWER (422)
Centurian Bank of Punjab (57)

Short to Med Term Delivery Buy: CHD Developers (19.50) Target 25-28

Good Luck

Intraday Calls for 21st Feb

Market may see a bounce back and strong rally after yesterday's fall due to global cues.

Buy for Intraday:

GMR Infra (171.5) Target 178-180 SL 168
Essar Oil (238) Target 250+ SL 230
Dish TV (67) Target 72-75 SL 65
KS Oils (85) Target 90+ SL 82
Gujarat NRE Coke (155) Target 160-162 SL 152
Infosys (1570) Target 1625-1650 SL 1560
Prithvi Info (264) Target 275-280 SL 260
REL (1575) Target 1650+ SL 1565
RPOWER (408) Target 425-430 SL 402
OCL India (272) Target 285 SL 268

Good Luck

Intraday Calls for 20th Feb

Market may open with flat to nagetive but some recovery expected from lower levels with high volatility.

Buy for Intraday:
Ruppee Touches 40 Mark. Its good for IT & Tech stocks.
Crude Touches $100 mark yesterday and its good for oil exploration companies.

Infosys (1556) Target 1600+ SL 1540
Mphasis BFL (230) Target 238-245 SL 225
NIIT Tech (128) Target 135+ SL 122
ACC (790) Target 800-815 SL 780
SAIL (230) Target 235-238 SL 225
Tata Steel (812) Target 825-840 SL 800
Hind Oil Exploration (111) Target 118-120 SL 106
Selan Exploration (152) Target 165+ SL 148
Cairn Energy (214) Target 225+ SL 210
KS Oils (85.50) Target 90-92 SL 82

Good Luck

Intraday Calls for 19th Feb

Today market may open positive but will remain rangebound with positive bias.


Buy for Intraday:


Reliance Industries (2552) Target 2625-2650 SL 2530
Dish TV (71) Target 75-78 SL 68
Alembic Ltd. (59) Target 62-65 SL 56
IFCI (65) Target 68-70 SL 62
WWIL (53) Target 58-60 SL 50
Escorts Ltd. (111) Target 115-118 SL 108
ALPS Industries (55) Target 60 SL 52
Cairn India (219) Target 230-235 SL 215
NIIT Tech (120) Target 125-130 SL 116
UNITECH (400) Target 415-425 SL 395


Good Luck

IPO Talk: Rural Electrification Corporation

Rural Electrification Corporation is entering the capital market on 19th February 08, with a public issue of 15.61 crore equity shares of Rs.10 each, in the band of Rs.90 to Rs.105 per share. 50% of this issue is by way of fresh issue while 50% is by way of offer for sale.
After the recent debacle of many IPOs, this is one of the mega issues, which intends to mobilize Rs.1,640 crores. It has been seen that PSU IPOs have been reasonably valued. This maybe due to the conservative approach of issuer’s officials, as also, no personal interest is involved, as sailing through the issue is more important than the valuation. This issue falls in this category.
The company is a public financial institution, engaged in the financing and promotion of transmission, distribution and generation projects throughout India. The company, all along has been financing public sector projects, but has been shifting to joint sector and private sector, in view of mega power projects, now being set up by the private sector. As at 30-09-07, total of Rs.35,050 crores has been financed by the company, of which 96.33% has been to the public sector.
For FY 07, the total income of the company was at Rs.2,933 crores with PAT of Rs.776 crores, giving an EPS of Rs.9.95 on equity of Rs.780.60 crores. First six months of FY 08 seems to be quite good with topline at Rs.1,792 crores and PAT of Rs.523 crores, which results in an annualized EPS of Rs.13.40. Even on fully diluted equity of Rs.858.66 crores, this would be close to Rs.12.20. The present book value, as at 30-09-07, is at Rs.54, which would rise to Rs.63 to Rs.64, depending on the price discovery, post IPO.
Fresh infusion of Rs.700 crores to Rs.800 crores, into the company would be EPS accretive and 82% government stake, post issue, is also an assuring feature. The funds are mobilized mainly to augment capital base to meet future capital requirement of improved business and to list the shares.
We feel that in this turmoil, when primary market is not at all comforting with any good IPO, this is a better issue, where investors can safely apply for reasonable gains.

Source:sptulsian.com

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