1. Reliance Communications is introducing 4G LTE with network partner Reliance Jio in most of its service areas. The company derives a large proportion of its revenue from wireless internet services. It also offers the cheapest voice rates in the country, and has an estimated 5 mln customers on its CDMA network.
4. The last correction seen in the domestic market continued only for few days, as FIIs pumped in fresh funds. Moreover, domestic institutional investors (DIIs) has been lending their much-needed support to the market and has been cushioning a free fall.
In such a situation, and especially when the Nifty (cash) is above 8116-8150 levels, the short term TREND remains UP,both in the daily and weekly charts.
Also, the history suggests investors have always made money when there is fear. The current market conditions are something like that.....
In another very important development, the big Indian corporate houses are finding ways to deal with debt and the banks are encouraging them to go ahead. As reported recently in DNA India the economic research department of the State Bank of India has found that some of the big corporations are setting aside part of their assets to deal with debt.
For example, Anil Ambani’s ADAG has set aside assets worth Rs.59,761 crore to manage a debt of Rs.1,24,956 crore. That is a little less than 50% of the total debt. Reducing debt will improve not only the balance sheet of the corporation, but also that of the banks with their stressed assets.
Conclusion: Buy the stock of Reliance Communications Ltd at Rs.49.50, for short term targets of Rs.57-59.