Monday, March 23, 2015

Karuturi Global Ltd today touched Rs.1.99 in the BSE before closing at Rs.1.83. Accumlate the scrip as much as possible, some good news regarding its overseas ventures is coming within a short time. Sai Ramakrishna Karuturi, India's "King of Roses", made his fortune farming roses in East Africa for European markets. Now he's ploughing those profits into his next big African project: food production. Since 1996, Karuturi’s core business has been floriculture, producing 580 million roses per year from 289 hectares of land the company leases in Kenya (154 hectares), Ethiopia (125 hectares) and India (10 hectares). In 2012, the group commanded no less than 9% of the cut rose market in Europe. Since the 2007/2008 global food crisis, Karuturi began expanding from floriculture into food production. Its plan is to set up farming operations on over one million hectares, mainly in eastern and southern Africa, to produce primarily maize, rice, sugarcane and palm oil for international markets.
The hub of this expansion is Ethiopia. In 2009, Karuturi acquired 10,700 ha of land in Bako for maize, rice and vegetable production. In 2010, it got an additional 300,000 hectares for expansion in Gambela. The company aims to farm a total of 750,000 ha in Ethiopia. This land is leased from the government at bargain prices, but local communities consider it their own. As a result, many conflicts have emerged around compensation, displacement and the relocation of villagers and herders who suddenly found themselves fenced off of their lands by the Indian company. The company is taking steps to settle these disputes at the earliest. The stock would invariably cross Rs.5, in the next 3-6 months time. Have patience and keep buying all dips. 
Some days back, I suggested through this blog, not to buy the shares of Jenson and Nicholson Ltd, at around 8-9, when a couple of operators were trying to push the scrip for distribution. Many heard my call and did not buy, congratulations to them as the scrip today closed at Rs.5.88, down 9.26% in the BSE. It will slowly move below Rs.5, in the coming days.
Genera Agri Crop Ltd (Rs.4.43) today hit the buyer freeze in the late market trade. The scrip will reach Rs.7-8, in the coming days. I myself have good position in the shares of the company. 
Jaiprakash Power Ventures Ltd today touched Rs.10.70 before closing at Rs.10.47, due to late selling in the small and mid cap counters. The Parliament passed the Coal Mines (Special Provisions) Bill and Mines and Minerals (Development and Regulation) Amendment Bill which is positive for all the thermal power companies. The stock would invariably touch Rs.18-20, in the next 6 months. 
The correction in Rasoya Proteins Ltd (Re.0.73) is probably over. The scrip is unnecessarily falling in this bull market due to manufactured fear of GDR selling. Buy the scrip and hold for a couple of months, to get superb returns. 
Today Nifty (spot) closed at 8,550.90 down by 20 points. However, the fact that it is above 8500 gives much strength to the bulls. The Premium Members today were asked to use the dips in Nifty to build up long positions. However, the markets might turn volatile ahead of expiry of derivative contracts on Thursday. Meanwhile, Ridham Desai, said in an interview with Business Standard, on March 23, 2015: 
Valuations are not stretched because earnings are depressed. The key call is whether earnings are going to normalise. We recently surveyed our global investors and 76 per cent of them are overweight on India. The consensus is bullish and that, at times, acts as an overhang. Valuations are no longer at a level where it is the only criteria to invest. This is not December 2007, when valuations were at 30 times earnings.
The world has been grappling with an ageing population. It is dealing with debt levels never seen in the past.  Global debt is approaching three times of gross domestic product, which is staggering. There is not much appetite left to borrow from future earnings, which is creating deflationary pressures. The world has these problems but India does not have any of these. It still looks like one of the brightest stars in the universe. 
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