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Friday, August 01, 2014

FIIs Were Net Sellers Today Also
The DIIs on the other hand were net buyers to the tune of Rs.1074 crores. The FIIs have been continuously selling, since the last few days. According to the Economic Times, 1 August, 2014, overseas investors sold shares worth Rs.1,654 crore ($273.2 million) on Thursday. It was their biggest single-day selling since July 2, provisional exchange data showed. 

Also, Thursday marked a second consecutive day of net sales by foreign investors, totalling $319 million. Thursday's outflows included sales by Goldman Sachs Singapore, Deutsche Securities Mauritius and Morgan Stanley Singapore in certain stocks, NSE's bulk-deal data showed.

The markets have been rising-up on the excessive expectation of "Achche din" (good days) in the shortest possible time, post NDA took to power in Delhi. However, till now, in absence of any major development in the Indian economy we are witness the tremors of "Reverse-Modi-Tsunami". This will continue till excessive froth is removed from the system and strong hands give support. 
I M Vijayan could join blasters as an advisor
1-Aug-2014: I M Vijayan’s hallowed status amongst all in the Indian football fraternity has helped him achieve a new role with Kerala Blasters FC, the state's Indian Super League (ISL) franchise from Kochi.  

It may be remembered that Vijayan was a prominent figure in the entourage of Sachin Tendulkar and Prasad Potluri, director of PVP ventures, when the co-owners of the franchise visited the Jawaharlal stadium in Kerala.

Now the ex-Indian international’s experience with India’s footballing aspect has seen the Kochi team avidly look to entice him into their fold as an advisor.

“We have decided to bring I M Vijayan as an advisor to the team,” elucidated Rajeev Kamineni, a director at PVP Ventures, who is handling the Kerala franchise, to The New Indian Express.

Vijayan himself seemed excited at the prospect of watching top notch international footballers strut their swagger in the inaugural edition of the ISL exclaiming, “It would be a great honour to be associated with Kerala Blasters. It’s fantastic that a big team is taking shape in Kerala. Let good things happen to Kerala football out of this initiative.”

The former Indian record goal scorer is, as of yet however, to receive any confirmation of a post at the franchise, especially after the likes of Renedy Singh, Mehtab Hossain, Sandip Nandy, Nirmal Chettri and CS Sabeeth were drafted into the team.

“When Sachin visited Kochi, they had said I would be given a good post. I am waiting to see how that pans out,” concluded the ex-India captain.


Monday, July 28, 2014

Sunday, July 27, 2014

In big  infra push, PM sets roads, rail, power targets
New Delhi, July 27, 2014: With the objective of boosting growth, Prime Minister Narendra Modi on Saturday met the secretaries of nine economic ministries to outline a plan to put infrastructure development in top gear over the next two years.

At the meeting with the secretaries of roads and highways, civil aviation, shipping, power, telecom, railways, petroleum, coal, and industry, planning secretary Sindhushree Khullar made a presentation on targets for different sectors. She spoke of bottlenecks faced during the UPA regime and mooted the idea of a monitoring unit in the Planning Commission to remove these.

She also stressed on swift, time-bound clearance of projects and easing of environmental norms to ensure projects take off, government sources said. “The focus of the presentation was speedy development of smart cities, ports, roads, special economic zones and corridors (like DMRC). Greater infrastructure development by way of building more airports and ports, and having better connectivity through the railways was discussed,” said a source.

The infrastructure sector is a focus area for the Modi regime, and projects worth over Rs. 50,000 crore have already been cleared in the two months the government has been in power.

Construction of roads remains a top priority with the Centre setting a target of awarding projects for the construction of 8,500 km of highways this fiscal, against 9,638 km in 2013-14. However, the UPA government had managed to award projects for just 3,169 km last year.

Of the 8,500 km of highways, 3,500 km would be PPP projects and the remaining would be implemented on the EPC (engineering procurement construction) model where the government provides 100% funding.

The target for actual construction of highways in 2014-15 has been set at 6,300 km.

As many as 189 highway projects with a total cost of around Rs. 1,80,000 crore are currently stuck due to problems such as land acquisition issues, clearance delays, etc.

Since availability of power is critical for infrastructure development, issues related to power generation and transmission projects were discussed. “It was pointed out that the biggest challenge today is not power generation but transmission,” a senior government official said.

Building gas pipelines to ensure projects don’t suffer from fuel shortage also came up.

The official said, presently, over Rs. 1 lakh crore of investment in gas-based power capacity is suffering due to shortage of gas.

For the railways, it was proposed that 300 km of new track should be laid in the current fiscal.

The Indian Railways laid 450 km of new track in 2013-14, short of the targeted 500 km.

For the aviation sector, the plan panel proposed lowering the investment target from Rs. 1,008 crore in the previous fiscal to Rs. 934 crore this year, since investment realisation was just about 55% of the target in 2013-14.

A plan to develop airports in non-metro cities was talked about.

Other issues that came up for discussion included mobilising coal from one location to another, increasing rural tele-density and providing undersea fibre optic connectivity to the Andaman, Nicobar and Lakshadweep islands.

Courtesy: Hindustan Times
"If you want a KICKER, then BUY ILL-LIQUID STOCKS"
Courtesy: Alpha Ideas
PM Narendra Modi steps up focus on infrastructure, investment to boost economic growth
New Delhi:, July 27, 2014: With his party dragging the focus from development to aggressive Hindutva, Prime Minister Narendra Modi, who made it clear that the country needs “toilets not temples,” is all set to step on the gas.

On Saturday, he not only launched a portal to directly interact with people to get ideas on governance and development, he met top babus of the infrastructure ministries with an aim to give the desired boost to the ongoing projects.

During his meeting with the secretaries of nine infrastructure ministries, Mr Modi deliberated on setting targets for 2014-15 and identifying key projects in sectors like road, power and railways.

According to sources, Planning Commission secretary Sindhushree Khullar made a 15-page presentation on the performance of core infrastructure ministries in 2013-14 and deliberated on the targets suggested by the ministries for the current fiscal.

Courtesy: Deccan Chronicle
Prime Minister steps up focus on infrastructure
Photo: India 272
New Delhi, Jul 27, 2014: With his party dragging the focus from development to aggressive Hindutva, Prime Minister Narendra Modi, who made it clear that the country needs “toilets not temples”, is all set to step on the gas. On Saturday, he not only launched a portal to directly interact with people to get ideas on governance and development, he met top babus of the infrastructure ministries with an aim to give the desired boost to the ongoing projects.

During his meeting with the secretaries of nine infrastructure ministries, Mr Modi deliberated on setting targets for 2014-15 and identifying key projects in sectors like road, power and railways.

According to sources, Planning Commission secretary Sindhushree Khullar made a 15-page presentation on the performance of core infrastructure ministries in 2013-14 and deliberated on the targets suggested by the ministries for the current fiscal.

Since Mr Modi took charge of the country, his government has been keen on speeding up infrastructure development and investment to boost economic growth, which remained at sub-5 per cent level in the previous two fiscals.

Secretaries and senior officials from nine infrastructure ministries were also present at the meeting on Saturday.

Courtesy: The Asian Age 

Thursday, July 24, 2014

BlackRock Sees Revival as Roads Attract Tata: Corporate India
Billionaires Anil Ambani and Ajay Piramal are joining the Tata Group in seeking distressed Indian road projects offered by debt-laden builders amid Prime Minister Narendra Modi’s plan to boost infrastructure spending.
Photo: IBN Live
Jul 24, 2014: Piramal Enterprises Ltd. (PIEL) is negotiating to buy six road projects valued at 20 billion rupees ($333 million), said Parvez Umrigar, co-head of its structured investment group. The $100 billion Tata conglomerate, which bought three road projects last year, and Ambani-led Reliance Infrastructure Ltd. (RELI) are looking for more.

Modi’s pledge to spend $25 billion on roads, airports, ports and smart cities to unclog Asia’s third-largest economy and spur expansion is encouraging investors to buy stalled road and power projects. The highest interest rates among the region’s biggest markets and growth near a decade-low crippled the original builders, forcing them to sell.

“The infrastructure sector is at an inflection point right now,” Rohit Singhania, fund manager for DSP BlackRock T.I.G.E.R fund with 14.38 billion rupees under management, said in a July 17 telephone interview. “We need a lot more roads, power plants, highways and ports. And the new government understands it has to pump investment in these.”

The T.I.G.E.R fund, abbreviated for The Infrastructure Growth and Economic Reforms fund, has delivered returns of almost 44 percent this year beating 96 percent of its peers. The fund’s gains are almost double those of the benchmark S&P BSE Sensex this year.

Modi’s Task

Part of Modi’s task is to induce private investment in infrastructure to follow through on his campaign promises, curb a consumer inflation rate of more than 7 percent and rein in the fiscal deficit to a seven-year low of 4.1 percent of gross domestic product.

His administration’s maiden budget on July 10 cleared the way for dedicated investment trusts and eased infrastructure lending rules. Roads received an allocation of 523 billion rupees in the plan and urban infrastructure 500 billion rupees, as part of 1.48 trillion rupees for everything from highways, ports to housing.

India’s central bank allowed lenders to sell long-term bonds exempt from reserve requirements to bolster funding for infrastructure and affordable housing.

‘Booster Dose’

The budget announcements and central bank’s efforts, according to Singhania, will be “a big booster dose” for the sector. “Things will begin to improve over the next six to nine months” with road developers seeing a pick up in profits over the next year, he said.

India needs to spend about 17.6 trillion rupees by 2017 building roads, bridges, ports and railways, according to estimates of the Planning Commission of India.

The country will have to invest $2.2 trillion by 2030 on urban transportation, housing and office space, McKinsey & Co. estimated in a 2010 study. India’s infrastructure is ranked below that of Guatemala and Namibia by the World Economic Forum.

Tata Realty and Infrastructure Ltd. plans to spend 227 billion rupees by 2018 on roads, technology parks, malls and residential complexes, Managing Director Sanjay Ubale said. The company is one of three companies being handpicked by group chairman Cyrus Mistry to lead a $8 billion push into the sector.

“There is going to be a lot more action in the roads sector in the days to come,” Mumbai-based Ubale said in an interview on July 10. “We are looking at stressed road assets. We had bought some last year. We are looking at some more projects now.”

Debt Recast

Hyderabad-based IVRCL Ltd. (IVRC), which sold three projects to Tata Realty, this month received an approval for a debt recast as the builder struggled with a record annual loss and debt that more than quadrupled in the last five years, according to data compiled by Bloomberg.

IVRCL wrote off receivables worth 2.3 billion rupees in the March quarter, local brokerage Tata Securities Ltd. wrote in a June 3 note highlighting its “worry over high receivables.” It still has about 7.5 billion rupees of receivables under arbitration or unbilled for over three years, the note said.

Stalled power and road projects amid the economic slowdown impaired builders’ ability to repay loans, making them among the biggest contributors to banks’ soured debt in the past two years, according to the local arm of Fitch Ratings.

“Distressed road projects were an impediment to economic growth,” Chintan Lakhani, an analyst at India Ratings & Research, the local unit of Fitch Ratings, said in a telephone interview on July 16. “These deals would make way for fresh investments and renewed interest in the sector.”

Portfolio Churn

Piramal would only consider assets that are commissioned and face “no execution risk,” according to Umrigar. “We are not going to take the risk of land acquisition, forest clearance, environmental clearance. We will enter when the contractors want to churn their portfolio.”

Reliance Infrastructure, whose shares have risen 78 percent this year, expects more deals to close now as the asset valuation mismatch between the buyers and sellers narrows, Lalit Jalan group director for strategy and corporate affairs told reporters on July 18.

Reliance Infra shares rose 0.9 percent to 759.40 rupees in Mumbai, while the Sensex gained 0.5 percent. Piramal rose 0.9 percent, the most in a week, to 638.20 rupees.

An economic revival may widen the valuation gap between the buyers and sellers, hindering deals, said BlackRock’s Singhania, unless a road builder was “extremely starved of funds and being forced by its bankers.”

Piramal expects the deal stalemate to ease as developers try to either repay their debt or seek to exit from projects they have invested for 5 or 10 years, to free up their funds. Most road projects have a 25-year tenure.

“Nobody has a business thesis to continue holding a project from day one to 25 years,” said Piramal’s Umrigar. “Considering the macroeconomic scenario and financial health of the contractors, we are at a stage where projects will start changing hands.”

Courtesy: Bloomberg

Wednesday, July 23, 2014

Genera Agri Corp Ltd hit another buyer freeze today at Rs.6.91 at the end of day, before closing at Rs.6.88. The scrip will reach Rs.9, in the next few trading sessions, as a pickup in seasonal rainfall tempered concern inflation will accelerate.
Today, the diversified firm (Real Estate, Special Situations and Media & Entertainment) PVP Ventures Ltd was recommended a buy to the Premium Group Members at Rs.8.10-8.30, after the source based news said that the company is now almost DEBT FREE. The company is tentative to declare its results on the 2nd week of August, 2014, according to the sources, who refused to be named. After the board meeting, the FY14, annual report will be also be out. It is to be remembered that PVP Ventures Ltd owns 70-acres of land parcel situated in the heart of the Chennai and about 4 km from Chennai Central Railway Station. This land is under joint development with Unitech Limited and Arihant Housing & Foundation Limited. Going by the response to the first few phases of this project, it is all set to be one of the largest realty projects in South India. Over the next few years, this project is expected to yield approximately Rs.1500 crores to PVP Ventures Ltd. Meanwhile, David James will be unveiled as the player-manager of the Kerala Blasters, which is the Kochi-based franchisee of the Indian Super League (ISL) owned by cricket legend Sachin Tendulkar and his partner Prasad Potluri of PVP Ventures Ltd. The scrip is therefore, moving towards Rs.11, in the coming days. 
As expected IVRCL Ltd (Rs.23.05), today formed a double bottom, and bounced from the support. The scrip should be accumulated at all declines as after the approval of any CDR package, the share price of a company, generally shoots up, Viz. Suzlon Energy Ltd, A2Z Maintenance Engineering Ltd, etc. 
A2Z Maintenance Engineering Ltd, which was recommended here in this blog, at around Rs.11-12, today hit anther upper circuits at Rs.33.35. When I recommended the scrip, few months back, many rebuked me; saying when even Rakesh Jhunjhunwala is selling his holdings, why I am recommending this kind of counter? Now they have mud on their faces.
Continuing the upward journey, Nifty closed with a huge gain of 27.90 points today at 7795.75. It was earlier mentioned to the Premium Group members, that, the bounce back from the level of 7442 and a rise of 263 points last week clearly showed buying interest at lower levels. A recovery after 5% correction was very much expected which came. However the area of 7800, being the previous high, is attracting some profit booking. Moreover, to add to the fundamentals, Indian Rupee strengthened the most in more than a week and the government bonds gained as a pickup in seasonal rainfall tempered the concern, that inflation will accelerate. According to Bloomberg: The deficit in the June-September monsoon, which accounts for more than 70% of India’s annual rainfall, has narrowed to 27% of the 50-year average, the weather department said yesterday. The gap was 43% on July 11. Gains in India’s consumer-price index slowed to 7.31% in June, the least since the gauge was introduced in January 2012. In such a scenario, the investors are suggested to focus once again on the small and mid cap counters (especially from the construction/ real estate and banking space) for some superb returns going forward; as large caps could consolidate around this range for some time and the RBI could either keep the rates unchanged or go for a slight cut. It seems the Bulls are in full control of the affairs in Dalal Street.
Resurgere Mines and Minerals Ltd: Shareholding Pattern of June, 2014 quarter
Please Click on the Photo to Expand
We can clearly see, from the shareholding pattern of the company, that holdings of the promoters (and other large entities) have more or less remained same during the last two quarters. This puts to rest, the controversy spread by vested interest group/s that the promoters have allegedly sold their holdings. If the company starts mining in its BAUXITE mines in Maharashtra, then the scrip could even cross its book value. 

Moreover, this event is in stark contrast to its peer group company, SVC Resources Ltd, whose promoter holding has steadily decreased during the last few quarters; but surprisingly, the Re.1, Face Value share is still at Rs.2.59 (Rs.25.9, if we consider Rs.10, as Face Value) as compared to Rs.2.16 (Face Value: Rs.10 and not Re.1) of Resurgere Mines and Minerals Ltd. 

A notorious group is very active on the counter, because they probably want to purchase the shares of the company, much below the CMP of Rs.2.16 (BSE rate). Hence, they are trying all the mischief, at their disposal to pull the share of Resurgere Mines and Minerals Ltd down. 

But then, it is only the fools who think that they can control the markets, all the time and everytime. 
Kerala Blasters Sign Seven Players
Photo: Telugu Cinema
Thiruvananthapuram, 23rd July 2014: Kochi-based Kerala Blasters Football Club did brisk business on day one of the central domestic player draft for Hero Indian Super League at Mumbai on Tuesday signing seven players, including Indian internationals Mehtab Hossain and Nirmal Chhetri.

Assistant coach Trevor Morgan was the kingpin for the Blasters and it showed with four out of seven players - Mehtab, Chhetri, Gurwinder Singh and Sushanth Mathew - drafted into the ISL team having played football for East Bengal FC when Morgan was the head coach there.
Mehtab Hossain, Nirmal Chhetri, Godwin Franco, Gurwinder Singh, Ishfaq Ahmed, Sushanth Mathew  and Sandesh Jhingan
Mehtab was reportedly the highest valued Indian at Rs 35 lakh in the draft while 23-year-old Chhetri has already won nine caps for India. Ishfaq Ahmed, Sandesh Jhingan and Godwin Franco completed the line up for the club owned by Sachin Tendulkar and Prasad V Potluri.

Blasters signed Sushanth in round six, their only acquisition of a Kerala player on day one, but missed out on another in Mohammed Rafi who was picked by Atletico de Kolkata, co-owned by Sourav Ganguly. Four more Kerala players will come up for grabs on the final day of draft on Wednesday.

Blasters secured the signature of highly- experienced winger Ishfaq Ahmed, who played for Mohammed Sporting SC last season. Jhingan, a young centre back, was a player for Mumbai FC in I-League.

28-year-old defender Franco, along with his soon-to-be teammate Chhetri, were called up for trials with German second division side Fortuna Dusseldorf last December.  Having already secured a winger and three defenders and midfielders each, Blasters are expected to try to bolster their striking department as well sign a goalkeeper in the remaining seven rounds on day two.

Apart from Morgan, Rajeev Kamineni, executive director of PVP Ventures, William D’Silva and Soli K Colah, managers of the team, represented Blasters at the draft.

Team owners Tendulkar and Potluri stayed away from the draft on Tuesday, but the latter is expected to attend on day two.

Courtesy: The New Indian Express
Private companies may be permitted to commercially mine coal
NEW DELHI, Jul 21, 2014: The Modi government will initiate the process of allowing private companies to commercially mine coal and end the state monopoly after the public offer of shares of Coal India Ltd (CIL), official sources said.

"The new government is keen to allow private firms into commercial coal mining to increase supply of the fuel in the country. But we are not opening too many fronts at this moment. We will start discussions with stakeholders on commercial mining only after Coal India's public offer," a senior coal ministry official said. A roadmap to allow private commercial mining of coal will be prepared after an in-principle nod from all stakeholders is secured, he said.

CIL has not been able to increase output to match the surge in demand although it has huge reserves of the fuel. The Tatas, Adani, Anil Ambani group and others have successfully mined coal in India or abroad, but the law requires them to use their domestic output only for their own captive plants. Allowing them to sell coal in the market will give a big boost to industry, particularly power plants, and cut imports that amount to almost Rs 1 lakh crore a year.

The coal ministry will hold talks with trade unions of coal companies on opening up the sector after the public offer of CIL that is expected later this financial year. Opposition from trade unions has stalled an amendment to the Coal Mines (Nationalisation) Act to allow commercial coal mining since 2000.

The amendment bill was introduced in RajyaSabha in April 2000 and a group of ministers was constituted in 2001 to convince the trade unions. The panel was re-constituted in August 2009 under the chairmanship of the finance minister. However, the previous governments did not succeed in getting the bill cleared. CIL's trade unions are against the government's move to offload 10% in the company. The public offer could fetch Rs 23,000 crore, over half of the Rs 43,425 crore that the government proposes to mop up in 2014-15 from equity sale in state-run companies.

The coal ministry has already sought the law ministry's comments on amending the Coal Mines Nationalisation Act in the backdrop of the recently amended Mines and Minerals Regulation and Development Act that provides for coal block allotments through auction for captive use.

"The Mines and Minerals (Development and Regulation) Act was amended only recently to auction coal blocks. Now, we have a challenge in opening the coal sector as the amended act doesn't provide for bidding blocks to commercial purposes. We have approached the law ministry for comments," the official said. The government in the Economic Survey released on July 9 said there was an urgent need to fast track entry of the private sector in commercial coal mining to augment country's coal production and reduce imports of the fuel that costed Rs 95,175 crore in 2013-2014.

Commercial coal mining is widely seen as an answer to the increasing demand-supply gap of coal in the county and allowing private commercial mining is expected to increase competition, infuse new technology and lead to a market-based price discovery.

CIL is unable to meet the demand for coal in the country. The firm blames delayed environment and forest clearances for the slow growth in production. The captive coal blocks have also not come up as per expectations.

Of the 218 allocated mines, only 40-odd have come into production. The coal ministry has de-allocated 80 of these mines and most of the captive coal block companies have challenged the decision in courts.

New report forecasts boost for India’s construction sector in 2015
Photo: Udaipur Times
MUMBAI, JULY 22, 2014: India’s construction sector is forecast to grow at 7-8 per cent each year over the next decade. With the new government, the country is expected to see increased economic growth and the removal of barriers to foreign investment that will "spur demand for construction" over the coming 12 to 18 months, according to a report by international consultancy giant PwC.

The report highlights how an estimated $1 trillion would be spent on infrastructure over the next three years to 2017. Stating that there would be increased investment in industrial projects by the government, the report has noted that it is the private housing sector that would be a key growth area.

The total construction market in India for fiscal year ending March 2014 was $157 billion, an increase of $4 billion over FY2013. Infrastructure accounts for 49 per cent, housing and real estate for 42 per cent and industrial projects for 9 per cent, the report noted.

Infrastructure firms seek senior executives after two-year lull
 Firms seek to reduce debt, turn around projects and win new ones from an expected pick-up in infrastructure growth
The Narendra Modi-led government’s plans to build a high-speed train network, 100 smart cities, dedicated freight corridors and airports in smaller towns are expected to help infrastructure firms, which are beefing up manpower for growth. Photo: Pradeep Gaur/Mint
Mumbai, July 21, 2014: After two years mired in a slowdown, top and mid-tier infrastructure firms are looking to hire senior executives, as they seek to reduce debt, turn around projects and win new ones from an expected pick-up in infrastructure growth. Officials at executive search firms said they have been mandated to find suitable candidates for GMR Group, KEC International Ltd, Larsen & Toubro Ltd (hydrocarbon business), L&T Infrastructure Finance Ltd and SREI Infrastructure Finance Ltd, which have interests in power, roads, water and ports. 

Search firms like Executive Access Ltd, RGF Executive, EMA Partners International and ABC Consultants each have at least five mandates to hire senior-level executives with ‘entrepreneurial skills’ to support expected growth in the sector. 

The Narendra Modi-led government’s plans to build a high-speed train network, 100 smart cities, dedicated freight corridors and airports in smaller towns are expected to help infrastructure firms, which are beefing up manpower for growth. 

“Last two years was a phase of consolidation and we did not see profit growth. But we are geared for growth now,” said Hemant Kanoria, MD, Srei Infrastructure Finance Ltd, which is looking to add about five senior executives for its water, power, special economic zones and road businesses. 

Infrastructure was among the worst-hit during India’s economic slowdown, so much so that a March report by International Monetary Fund (IMF) attributed the slowdown largely to infrastructure delays. Delayed clearances, heavy debt, high interest rates and a slowdown in demand had all contributed to stagnation. 

As a result, senior-level hiring almost came to a standstill over the last two years and some companies even let people go, said headhunters and company executives, who did not want to be identified. 

Compensation also remained flat across the sector. “Executives were given phenomenal compensation, but over the last three years, with the slowdown, there have been very slight salary increases and very little incentives for the senior level, says Anandorup Ghose, Rewards Consulting Practice Leader at Aon Hewitt India. 

Last year, while the average salary increase across sectors at the top management was 8-9%, infrastructure executives saw lower salary increases of 5-7%, said Ghose. However, firms are now re-booting. KEC, part of the RPG Group, created a new role and hired Rakesh Amol as president of its infrastructure business in April, where he would be responsible for railways, water and any future infrastructure verticals the company may get into. 

“We wanted someone who had the entrepreneurial trait of capturing and leveraging all opportunities. In the past, while we looked at people with leadership skills and project execution capabilities, this time, our focus was on someone with strong entrepreneurial capabilities,” said Arvind Agarwal, president, corporate development & HR for RPG Group. Headhunters agree. “Earlier, senior executives held a more maintenance role, but now, they are looking for stronger execution skills coupled with the ability to identify opportunities and deliver faster turnaround on projects,” said Ronesh Puri, managing director, Executive Access. 

The ability to deleverage balance sheets is also sought after, at a time when most infrastructure companies are burdened with debt. “Infrastructure companies are heavily debt-laden and what they seek is expertise in financial turnaround skills and not just raising capital,” said K Sudarshan, managing partner of EMA Partners, who has mandates to hire 10 senior level infrastructure executives, including at the CEO and CFO level. 

“As part of the preparation for new projects in the coming year, we are looking at augmenting our talent pipeline in select and niche areas where specialized skill-sets are required for developing large, complex infrastructure projects and asset management, said Sanjeev Sahi, president, human resources, GMR Group. 

Hiring by infrastructure firms is driving business for search firms, making it one of their fastest-growing segments. “Business in this sector has more than doubled as there is a real war for talent,” says Puri.

Courtesy: Live Mint
PMO to take stock of infrastructure projects this week
NEW DELHI, Jul 22, 2014: For the first time, the Prime Minister's Office (PMO) will this week take stock of the targets set by each infrastructure ministry after the Narendra Modi government took charge.

The Planning Commission, which has been tasked to prepare the presentation for all infrastructure sectors, has sought details from all departments. Sources said the first such umbrella meeting on targets for this financial year is crucial since the Prime Minister has already gone through individual presentations by each ministry and department.

They added that ministries are likely to stick to their earlier targets, though a final call will be taken by PMO considering the achievable targets.

Government officials said the road ministry is likely to submit that NHAI and the ministry would be able to award 8,500 km including 3,500 km on build, operate and transfer (BOT) mode despite the first set of three BOT projects not getting a single bidder. All these projects — Delhi-Meerut Expressway, Varanasi-Sultanpur and Varanasi-Ghaghar bridge stretches — were cleared by the new cabinet.

On the construction front, the target is likely to be 6,300km, out of which NHAI would build about 2,000km.

Meanwhile, the PMO has also sought details of projects and programmes run by all the departments within a week. "Though the communication does not detail the reason behind this, we feel the intention could be to get a complete picture of the activities and to find out which all have been successful and what all have failed," said a senior government official. 

Tuesday, July 22, 2014

Market Mantra
Today's call: Genera Agri Corp Ltd (BSE Code: 590133)  at Rs.6.58-6.59 hit the buyer freeze, in the mid-afternoon trade. The scrip has a book value of Rs.74.27 and EPS of Rs.3.11.  The stock is expected to hit some more buyer freezes on the way to Rs.9. 
It seems the correction in IVRCL Ltd is over, and the scrip should move up after forming a double bottom. The book value of the shares of the company is Rs. 47.33, which is likely to improve in the coming days, as the company's CDR package has been approved and the government of India has decided to give more impetus to the Infrastructure (especially construction of roads and highways), sector. 
Allied Digital Services Ltd is slowly inching towards the 1st target of Rs.25. Today it touched Rs.21.45 and is now trading at Rs.21, up 2.92%. 
Resurgere Mines and Minerals Ltd (BSE Code: ) hit the buyer Freeze in NSE at Rs.2.20 and is slowly moving towards Upper Circuit in the BSE too; which is placed at Rs.2.27. The CMP in BSE is Rs.2.23.

Monday, July 21, 2014

Sebi draft norms for infrastructure trusts
[Editor: To encourage infrastructure development, RBI exempted long term bonds from mandatory regulatory norms like CRR and SLR if the money raised is used for funding of such projects. In other words, "Banks can issue long-term bonds with a minimum maturity of seven years to raise resources for lending to long term projects in infrastructure sub-sectors," the Reserve Bank said. The central bank said it intends to "ease the way for banks to raise long term resources to finance their long term loans to infrastructure". To say it in simple terms: Reserve Bank of India (RBI) said banks would not have to maintain cash reserve ratio (CRR) or statutory liquidity ratio (SLR) and will not have to meet priority-sector lending targets for funds raised through bonds for extending credit to these sectors. Meanwhile, the Planning Commission secretary Sindhushree Khullar is scheduled to make a presentation this week on the performance of infrastructure sector in 2013-14. Secretaries from the ministries of power, road transport, shipping, civil aviation, coal, petroleum will also be present during the presentation. As many as 189 highway projects with a cost of Rs.1,80,000 crore are stuck due to various hurdles. Therefore, the time has come to invest in the infrastructure stocks, like IVRCL Ltd at Rs.23.35 and keep holding. It is to be remembered that the corporate debt restructuring cell (CDR) has approved an almost Rs.7,000-crore debt recast proposal for IVRCL Ltd. The company is also coming up with a Rights issue]
MUMBAI, Jul 18, 2014: In an attempt to meet the long-term financing needs of the infrastructure sector, Sebi on Thursday issued draft guidelines that would pave the way for launching infrastructure investment trusts in India. These trusts will invest public money only into completed and revenue generating infrastructure assets, and under-construction projects. The units issued by these trusts, just like mutual funds, will also be compulsorily listed on the bourses thus providing liquidity to investors.

Banks, international multilateral financial institutions, foreign portfolio investors (FPIs), including sovereign wealth funds, can come in as strategic investors in infra investment trusts.

Infra investment trusts are proposed to "provide a suitable structure for financing/refinancing of infrastructure projects in the country," Sebi's draft guidelines said. These trusts will invest in "infrastructure projects, either directly or through SPVs. In case of PPP projects, such investments shall only be through SPV," it added.

According to Sebi's draft rules, an infra investment trusts which will invest at least 80% of the corpus in completed and revenue generating Infrastructure assets, will be allowed to raise funds only through public issue of units and the minimum subscription size and trading lot for such units will Rs 5 lakh. The balance 20% of the corpus may be invested in under construction infrastructure projects (subject to maximum of 10%) and other permissible investments.

An infra investment trust that aims at investing more than 10% of the corpus in under construction infrastructure projects, will be allowed to raise funds only through private placement from institutional players and body corporate. The minimum investment and trading lot for such units is fixed at Rs 1 crore. "Such (trusts) shall mandatorily invest in not less than one completed and revenue generating project and not less than one pre-COD project.

The draft guidelines said that the proposed holding of an infra investment trust in the underlying assets should be at least Rs 500 crore and the offer size of the trust shall not be less then Rs 250 crore at the time of initial offer of units. The rules also said that the total borrowing of such trusts and the underlying SPVs should not exceed 49% of the value of the trust's assets. However, this may exclude any debt infused by the trust in the underlying SPV. Further, for any borrowing exceeding 25% of the trust's corpus, requirement of credit rating and unit holders approval will be mandatory.

Friday, July 18, 2014

Mining lease cancellation: Govt moves SC for transfer of cases
The illuminated building of
the Supreme Court of India
New Delhi  July 18, 2014: The Centre today approached the Supreme Court seeking its direction to transfer before it all cases arising out of mining licence cancellation that are pending in various high courts. 

Agreeing to hear the Centre's plea, a bench headed by Chief Justice R M Lodha issued notice to all the companies which have filed petitions in the high courts. 

The Supreme Court sought response from Corporate Ispat Alloys Ltd, JWS Energy Ltd (Jindal Thermal Power Company Ltd), Bhushan Power and Steel Ltd, Sainik Mining and Allied Service Ltd, Ultratech Cement Ltd, Jharkhand State Mineral Development Corporation, Jayaswal Neco Industries Ltd and Bihar Sponge Iron Ltd on transfer petition filed by the Centre.

Courtesy: The Business Standard
Domestic and Indian Gold Rally Strong In H1 2014
Domestic and Indian Gold Rally Points to a Strong Second Half by Frank Holmes
July 17, 2014: Earlier this week we reported that gold, defying expectations, is one of the best-performing commodities of the year so far.

And now we’ve learned that gold bullion imports by India climbed a stunning 65 percent last month after the country’s central bank allowed more investors to buy foreign bullion. Imports rose to $3.12 billion in June from $1.89 billion this time last year.

India is the world’s second-largest consumer of gold after China, accounting for approximately 25 percent of all gold consumption. Gold is the country’s second-largest import item after oil.

This news comes closely on the heels of the recent election of Prime Minister Narendra Modi, whose Bharatiya Janata Party (BJP) seeks to loosen import restrictions and other government regulations that tend to stifle economic growth. The rally also coincides with the Indian wedding season, which typically ends on July 7 and 8.

More importantly, what this news could portend is a stronger-than-normal second half of the year for the gold market. Data points going back 35 years confirm the probability of gold gaining strength in the second half, thanks largely to international celebrations such as Diwali, Ramadan and Christmas. This year in particular looks very promising indeed.

Keep your eyes on real interest rates
Recently I chatted with Daniela Cambone during my weekly Gold Game Film program on Kitco. I pointed out that, with the end of the Indian wedding season, we’re historically due for a slight correction in the gold market. But whereas last year saw a huge contraction and liquidation of gold around this time, the gold bullion exchange-traded funds (ETFs) around the world this year actually expanded.

Daniela and I also looked ahead at the gold market in the coming months. One of the points I shared dealt with the strong correlation between gold performance and real interest rates, which you arrive at after subtracting inflation from the nominal interest rate.

If we go back to when gold was at $1,900 [in August 2011], the negative real interest rates were 200 basis points. Then by December of last year, it went to plus 50 basis points. Now it’s gone negative again, and gold is rallying. And I think that that’s a key factor when we look forward, and I think we’re going to continue to have negative real interest rates. So when inflation starts to rise like it did in the ‘70s, [the Federal Reserve isn’t] going to be able to lift rates as fast as the inflationary rate because it will stifle the economy dramatically.

One last point I want to emphasize is our perennial suggestion to investors: 5 percent exposure to gold bullion, 5 to gold stocks, and rebalance each year for an overall 10 percent weighting in your portfolio.

Last year the stock market boomed, whereas bullion disappointed and gold stocks dramatically underperformed. Had investors taken their profits in the stock market and rolled it into gold, they would have done exceptionally well this year.

That continues to be our discipline here at U.S. Global Investors, and the recent gold rally, domestically and in India, substantiates this position.

Courtesy: Valuewalk

Nitin Goenka and Mahdeep Kapoor
Allied Digital Services Ltd, recommended today, to the Paid Service Members, at around Rs.20.60-21, today hit the upper circuits, in the closing trade. The scrip could be hitting non-stop upper circuits during the next few trading sessions. 
Resurgere Mines and Minerals Ltd, after a brief correction has again bounced back, hitting upper circuits today, in the BSE. Later it turned out to be only buyer. The punters are probably taking positions in the scrip before the  much awaited start of operations in the company's bauxite mine in Maharashtra, post monsoon. If the mining really starts there, then the scrip would cross its book value of Rs.26.49. It is to be understood that in a BULL Market everything moves up, and I feel this scrip will also spurt ahead, considering that its peer group company SVC Resources Limited, with much worse fundamentals, is trading at Rs.22.60 (if we consider the face value of the scrip to be Rs.10, instead of Re.1). 
Rohit Ferro Tech Ltd, after a sell call at Rs.14.20, today fell further, and closed at Rs.12.76. The sell call was given on the source based news that the commencement of operation in its 67 MW captive power plant will get further delayed, due to tight liquidity conditions. The scrip could fall below Rs.12 in the coming days. 
The Nifty was given a buy today, and as expected it closed in the Green. The FII/FPI on 18th July, 2014 were net buyers to the tune of Rs.574.47 Crores. As long as 7650-7600 is not broken on the downsided, the longs are a hold. However, the action would now be concentrated in the small and mid cap counter, many of which are still trading near their 52-week low, eg. Goenka Diamond & Jewels Ltd (Rs.3.38).  Incorporated in 1990, Goenka Diamond & Jewels Limited is in the business of cutting and polishing of diamonds and manufacturing and retailing of diamond jewellery. Goenka's product profile includes rings, earrings, pendants, bracelets, necklaces, etc. which are manufactured using polished diamonds, precious and other semi precious stones which are set in gold. Company has its own diamond processing unit at SEZ in Surat and in Mumbai. Goenka Diamonds retail its diamond jewellery under two brands CERES and G WILD. Company retail high end diamond jewellery under the CERES brand targeting the top-end segment of the society while G WILD focuses on internationally designed diamond jewellery targeting the youth. It came up with an IPO in March, 2010 at an issue Price of Rs.135-Rs.145 per equity share (Face Value: Rs.10). According to Business Standard, 24 March, 2010: "The initial public offer (IPO) of Goenka Diamond & Jewels, which opened for subscription on Tuesday, was over subscribed on the first day with institutional investors putting in sizeable bids".  M. B. Diamonds, a Limited Liability  and Goenka Diamond & Jewels DMCC, Dubai. Goenka Dimond and Jewels Ltd's subsidiary, M.B. Diamonds, in Russia, is one of the largest diamond producers. This allows the company to source rough diamonds, its primary raw material, directly through diamond auctions held there, which reduces the raw material costs. The subsidiary also has a unit to polish diamonds. The entire output of the subsidiary — both processed and rough diamond — is sold to the company. Goenka Diamond & Jewels Ltd (Now its Face Value: Re.1 and not Rs.10) has now appointed a new company secretary, and a board meeting to declare, Q4FY14 results could be on the cards. 
IVRCL Ltd today closed at Rs.24.10 down 2.03%. You should buy this scrip like Fixed Deposit and keep holding. Earlier, there were media reports that the Corporate Debt Restructuring Empowered Group of the Reserve Bank of India, at its meeting held, approved the debt recast proposal submitted by IVRCL. The restructured package covers Rs.7,350 crore. About 20 banks led by State Bank of India were involved in the restructure process. Under CDR, banks typically increase the repayment period of loans to stressed borrowers, offer a moratorium and reduce lending rates. “This is a significant development and comes in as a big relief. This will enable us to take off again by implementing various projects which were stuck due to funding issues. We have a strong order book of Rs.20,000 crore and will implement them as per plans,” R Balarami Reddy, Chief Financial Officer, IVRCL, said. Explaining the terms, he said the company will have access to a priority debt of Rs.175 crore, additional cash credit of Rs.200 crore, Rs.1,400 crore non-fund credit and Rs.300 crore of letter of credit. All of them will be interest-free from December 1, 2013, and have a moratorium of 28 months on term loans. The funded interest term loan is to be paid within eight years after the moratorium. It will carry an interest rate of 11.25%. The company’s interest burden had piled up and the cash flows were impacted due to slowdown in project execution. IVRCL was, therefore, forced to knock at the CDR cell. IVRCL had divested its stakes in three road projects in Tamil Nadu to a Tata group company Tata Realty and Infrastructure Ltd, and is in negotiations to divest stake in a couple of other projects, including a Chennai desalination plant and road projects. 
Accumulate Western India Shipyard Ltd at the CMP of Rs.2.37. as some good news is on the anvil.