Stock Idea: Cadila Healthcare

Religare has maintained its buy rating on Cadila Healthcare with a target price of Rs 381 in its June 5, 2008 research report. "We estimate that the domestic market would witness a 12% CAGR over FY08-FY10 driven by consolidation in existing therapeutics as well as entry into newer arears like the neutraceuticals and hospital segment. The outlook on the Hospira JV, which will commence in H2FY09, is very promising."
"Valuations at 11.7x FY09E EPS of Rs 24.6 and 9.6X FY10E EPS of Rs 29.8 remain attractive. We remain Buy with target price of Rs 381 based on 15x FY09E earnings," says Religare's research report

Markets Today

Markets Snapshot
Markets witness sharp fall falling U.S. market cues and in line with Asian peers
Nifty hits new 2008-low during the day; manages to close at 4500; Nifty recovers nearly 80 pts from day's low
Sensex ends down 506 pts at 15066; falls below 15000 during the day
Reliance Ind hits new 2008-lows at 2111
BSE Smalll-cap Index down 3.6%, Nifty Junior down 3.8%
Bank, Realty & Cap Goods hit new 2008-lows
BSE Realty Index down 7%; Unitech down 9.6%, DLF down 7.2%
BSE IT Index down 4.2%; TCS down 3.4%, Wipro down 5%, Infosys down 4.6%
BSE Cap Goods, Oil & Gas Index down nearly 3.3%
Index losers; Suzlon down 6.5%, ONGC down 6.3%, HDFC down 6%
Index Gainers; Nalco up 4.8%, Cairn India up 4.4%, Ranbaxy up 3.7%, RPL up 2.9%
Non-Index losers; Bajaj Auto Fin down 13.5%, Neyveli Lignite down 9.2%, HCC down 10%, Alok down 9.3%
NSE Advance Decline at 1:8
Total market turnover at Rs 76668 cr; FNO turnover at Rs 58333 cr
F&O Snapshot
Nifty futures discount at 14 pts; add 33.5 lakh shares in OI
Some short covering in Nifty futures seen in last half an hour of trade
Unwiding seen in momentum stocks; Fresh long seen in Cairn, Ranbaxy, R Comm
Fresh shorts seen across sector: oil & gas, realty, infra stocks
Fresh shorts: Suzlon, NTPC, Power Grid, RIL, ONGC, JP Ass, GMR Infra. DLF
Unwinding of long positions seen in Ispat, Alok, Ambuja Cem, Nag Fert, IFCI
Options Action Nifty 4200 put add 26 lakh shares in OI Nifty 4500 call add 24 lakh shares in OI Nifty 4400 put add 12.5 lakh shares in OI Nifty 4700 call shed 12 lakh shares in OI

Source: moneycontrol.com

Intraday Trading Calls for 09th June

A Gap down opening (-2-3%) expected in Stock Market India but it may recover smartly from intraday lower levels. So today can be a golden chance for investing in valuable stocks at lower levels.

Today's Intraday Stock Tips/Trading Calls:

Buy at lower levels from previous close for intraday recovery gains:

RPL

CAIRN INDIA

ONGC

ASIAN ELECTRONICS

VOLTAS

PRAJ INDUSTRIES

SELAN EXPLORATION

Corporate News
SpiceJet is looking to raise Rs4bn in equity capital to part finance aircraft acquisitions plans.(BL)
Punj Lloyd lines up a capex of US$100mn for 2008-09.(BS) Punj Lloyd secures Rs6.5bn order from IOC for the latter’s Barauni refinery.(FE)
NTPC and its JV subsidiary, Nabinagar power plant, awards BTG contracts to BHEL for Rs35bn.(ET)
Nalco announces expansion plans worth Rs400bn for the next five years.(BL)
Essar Steel Holdings says it might raise its takeover bid for US based Esmark.(BS)
Reliance Petroleum's export oriented 29mn tons refinery to start generating revenues from current year.(BS)
Indian Oil and Oil India to acquire Reliance Industries’ offshore oil block in East Timor.(BL)
JK Lakshmi Cement is adding five more ready-mix concrete units as part of its expansion plans.(ET)
UAE based Etisalat pulls out of negotiations to acquire stake in Spice Communications; cites high valuations.(BS)
Cargill Ventures has cut by half the US$9mn investment it had announced into KPIT Cummins a year ago.(DNA)
GMR Infrastructure to relocate its 220MW power plant to Kakinada in AP from Mangalore in Karnataka.(DNA)
Sobha Developers to foray into the Mysore realty market with three projects in current fiscal.(BS)
Corporation Bank may waive Rs2.8bn under the debt relief scheme for farmers.(BL)
UK based Vincent Tchenguiz is holding talks with Tata, to invite investment from the latter in a new US$10bn environment fund.(ET)
CavinKare and Henkel have announced a 5% hike across product categories.(TOI)
Axis PE, the PE arm of Axis Bank, is investing Rs1.4bn in two Ahmedabad companies.(ET)
Delhi government owned Indraprastha Power Generation to set up a 2,000MW coal fired power station in MP.(FE)
Gail India is looking at setting up a CNG corridor comprising Nagapattinam, Karaikal and Puducherry.(ET)
Six NBFCs, including Shriram Transport Finance, Ashok Leyland and Reliance Capital are believed to be in the race for buying a US$1bn loan portfolio of Citicorp Finance.(ET)
Alok Industries has resumed talks with PE players to dilute 20% equity it owns in its unlisted unit, Alok Infrastructure.(ET)
Mercator Lines has chartered out a new offshore rig to a Singapore-based firm for US$93,000 per day for three years.(ET)

Good Luck

Stock Ideas: Kamanwala Housing, Spanco Telesystems

After posting encouraging results for Q4FY08, Kamanwala Housing Construction Ltd. (Code: 511131) (Rs.122.65) has announced 1:1 bonus along with 25% dividend for FY08. For Q4FY08, its topline shot up 120% to Rs.28.50 cr. and bottomline surged by 85% to Rs.9.40 cr. posting a whopping EPS of Rs.17 for the quarter. But operating in the real estate & construction sector and following the revenue model on sale of agreement basis, the company is bound to post erratic and lumpy results on a quarterly basis. For full FY08, it reported total revenue of Rs.96 cr. and net profit of Rs.24.40 cr. i.e. EPS of Rs.43 on its current equity of Rs.5.65 cr. Notably, the company paid a tax of Rs.8.50 cr., which substantiates the profit. The company operates mainly in Mumbai and has a few good residential projects in Malad & Santacruz and a huge commercial project in the Bandra-Kurla complex. It has several projects lined up for future in Andheri, Mahim, Goregaon etc and even in Hydrabad. Lately, it also bought 10,000 sq. mt. land in Turbhe for Rs.15 cr. Recently, the company has allotted nearly 20 lakh preferential warrant to promoters at Rs.98. At the current market cap of Rs.75 cr., the scrip is trading fairly cheap and has the potential to cross Rs.200 level in the medium-term.

From providing telecom integration services to MNCs, PSUs and Defence sector, Spanco Telesystems Ltd. (Code: 508976) (Rs.132) has evolved to extend its expertise into the dynamic space of Business Process Outsourcing (BPO) and Radiofrequency identification (RFID) services. Recently in March 2008, the company bagged huge orders to the tune of Rs.200 cr. from Maharashtra, Bihar and M.P. governments. On the other hand, it is executing a 10-year contract to set up, operate and maintain Interactive Voice Response System (IVRS) and Regional Call Centres (RCC) for the Indian Railways in a joint venture with the Spice group. For the first three quarters, it has already recorded an EPS of Rs.17, which is higher than the entire FY07 EPS of Rs.16. Further, it is expected to clock a turnover of Rs.625 cr. with profit of around Rs.46 cr. on a standalone basis. This will work out to an EPS of Rs.22 on its current equity of Rs.20.65 cr. and an EPS of Rs.19.50 on its fully diluted equity of Rs.23.50 cr. At the same time, the company has decided to transfer all its BPO related businesses 10 including Respondez (international BPO), domestic call centre operations and the IRCTC project (a 50:50 JV with the Spice Telecom Group) into a separate subsidiary. This may be a precursor to unlocking value by hiving-off or de-merging its BPO business into a separate listed company in future. A screaming buy.

Source: Internet (MT)

Stock Idea: Nava Bharat Venture

PINC has maintained buy rating on Nava Bharat Venture with target price of Rs 340 in its June 04, 2008. "Nava Bharat Ventures Ltd. (NBVL) reported a YoY net sales growth of 89% to Rs 3.4 billion for Q4FY08. This was mainly on back of a 140% YoY rise in the revenues of its ferro alloy division. Power segment revenues also increased by 55% YoY. The OPM for the period witnessed a substantial 2,000bps jump to 46.4%, as NBVL capitalised on the unprecedented boom in the ferro alloy cycle. This led to around three fold jump in both operating profit and the net profits to Rs 1.6 billion and Rs 1.3 billion respectively."

"At the CMP of Rs270, the stock is trading at a P/E of 4.8x and EV/EBIDT of 3.8x its FY09E earnings. These, we believe are very attractive valuations for a company with very robust business model and effectively ‘Zero Debt’ . Moreover if ferro alloys continue to trade at these levels for entire FY09 (a strong possibility), then NBVL’s profitability could increase substantially. Hence, we initiate coverage with ‘BUY’ recommendation on the stock with a 12- month price target of Rs340" according to PINC report.

*****Moneybazzar's 12 month Target for Nava Bharat Venture Rs. 500+

Stock Idea: HCC

Prabhudas Lilladher has maintained its buy rating on Hindustan Construction Company with a price target of Rs 178 in its June 2008 research report. "Hindustan Construction Company’s (HCC) Rs 105 billion order book as on March 2008 includes the Rs 19.8 billion Sawalkote project, which is currently under dispute. Adjusting for this project, the order book would be Rs 85.2 billion, of which 50% contracts would have a wholesale price-based escalation, 30% would be star rate-linked and 10% linked to the metal index. The balance 10% would be fixed price contracts."
"We have a price target of Rs 178. HCC’s core business has been valued at 17x FY09 EPS, Lavasa has been valued at Rs 44 per share, the Vikhroli IT Park has been valued at Rs 16.7 per share, and the two SRS projects and annuity BOT projects at Rs 13.6 per share. We maintain BUY rating on the company," says Lilladher's research report.

Markets Today

GAP UP OPENING - SLIP IN THE LAST HOUR
Markets opened gap up at 4725.40 and flip-flopped between 4660 and 4710 through the session. However the market slipped in the later part probably due to lack in conviction to carry trade over the week-end.
Nifty closed down - 1.05 % losing 49.15 pts to end at 4627.18
Sensex closed down - 1.25 % to end at about 15572 down 197.54 pts
Broader markets too witnessed selling in late trade
Nifty Junior was down 1.31% (down 101.8 pts) ; while the CNX Midcap 100 lost 0.35% (- 21.75 pts)
BSE Small Cap Index was down about 0.51% ( -39.54 pts)
BSE Oil and Gas down 0.55% (- 55.75 pts)
BSE Healthcare Index down 1.15% (-49.88 pts)
BSE Metals Index lost 1.27% (- 199.80 pts)
BSE FMCG Index down 2.65% (-64.28 pts)
Gainers:SpiceJet gained smartly today, was up 14.49 % Cairn up (8.61%) had respectable gains by end of trade on the back of rise in crude oil price.Voltas gained 7.47%, HCC up 6.52%, Impex Ferro up 4.94%, Indiabulls Realty up 4.60%, Suzlon up 4.32%
Losers:ONGC ended its gaining streak to end with a 1.90% loss.GHCL (-11.3%), Neyveli Lignite (-7.65%), Piramal life Sciences (-7.63%), HPCL (-5.92%) all lost significantly The resilient Wipro (-4.44%), ITC (-4.07%), Mercator Lines (-4.20%) too lost.
NSE Advance Decline ratio at closing was 1 : 1.66
Total cash turnover at Rs 17589 cr today
Total F&O turnover at Rs 33425 cr Vs Rs 42656 cr on Thursday
Total market turnover was at Rs 51015 cr Vs Rs 65134 cr on Thursday
Global ShotAsian Indices ended mostly in the green, barring Shanghai and Kospi which were marginally in the red.
Nikkei (1.03%), Thailand (0.95%), Hang Seng (0.61%), Taiwan (0.08%) ended on a positive note; Kospi (-0.08%), Shanghai (-0.66%), ended in the red.
F&O Snapshot

Short Covering of Yesterday dint last long, Nifty sees fresh short build up in latter halfNifty fut slips into discount of 20 points in intra day’s trade Real Estate & Bank Stock sees short build up continuing in today’s trade as wellNSE F&O Turnover at 42888 cr lower than weekly averageNifty fut turnover at 13900 cr lower than weekly average
Options:Nifty 4800 put sheds 10.8 lakh shares

Nifty 4700 call adds 15.3 lakh shares

Nifty 4500 put adds 8.2 lakh shares
Star Trade: Cairn up 7.5%; adds 17.7 lakh shares
Fresh Short:Nifty dn 1.4%; adds 26.5 lakh sharesITC dn 3.2%; adds 13.5 lakh sharesDLF dn 4.4%; 10.7 lakh sharesNeyvli dn 8%; adds 5.5 lakh sharesIDFC dn 4%; adds 3.8 lakh shares
Long Unwinding:IFCI dn 3.1%; sheds 16.9 lakh sharesIspat dn 3.7%; sheds 13.7 lakh sharesJP Associates dn 3%; sheds 6.8 lakh sharesChambal dn 3.7%; sheds 6.6 lakh shares
Short Covering: Voltas up 6%; sheds 4.4 lakh sharesHCC up 5.6%; sheds 3.3 lakh shares