Saturday, May 13, 2017

Winning Strokes: Think Different
Idea Cellular Ltd yesterday moved to Rs.93, before closing at Rs.
92.35. The scrip if you remembere was recommended at around Rs.77-78, with a strong buy recommendation. The targets for the stock remains Rs.125-127, as the government has formed a panel to look into the owes if the telecom sector.

Reliance Communications Ltd rose to Rs.33.20 before closing st Rs.32.45, down 1.52%. However, the fall has been with low volumes especially on a day like Friday, indicating that selling is probably coming to an end. I am hopeful of targets of Rs.41-42, in the coming few weeks. RCOM is likely to be taken over by RJio, in the near future; till then any positive move for RJio is positive for RCom as it gets royalty income from the latter (infrastructure, spectrum Sharing, etc).

Yesterday, UCO Bank (Rs.41.70) moved to Rs.42.20 before closing flat, while Dena Bank (Rs.40.15) nosedived to Rs.40, intraday before closing near the days low. If you remember profit booking was suggested in both the counters, as I felt the bank (share) rally is over.

Simplex Projects (Rs.34.65) yesterday, moved to Rs.35.80 in the NSE with very low volumes. The stock is not responding to the triggers and is struggling to close above Rs.37. I would therefore, suggest the traders to exit on rallies. Long term investors however can hold with a SL at Rs.31.

Wednesday, May 10, 2017

Winning Strokes: Think Different
Today was the day for telecom stocks as most of them surging more than 2% intraday. At one time my recommended Bharti Airtel was up more than 9%, as the stock closed the at Rs.372.75 up more than 7%. The RCom closed at Rs.33.10, up 1.85% (Intra day high of Rs.33.85). Now, as RJio continues its paid packages and government takes initiative to revive the sector, the investors can look at this sector once again for some decent future gains.

Dena Bank Ltd which was recommended at around Rs.37, last months today made a new 52-week high of Rs.50 in the BSE. Another of my recommended counter in the PSU banking space UCO Bank Ltd closed at Rs.41.75 in the BSE after making an intra day high of Rs.43-plus. The investors are suggested to book profits in both the counters.

Shilpi Cable Technologies Ltd (Rs.74.65) continues to hit the lower circuits, after it broke a major support at Rs.117. I am expecting the share to go below Rs.70. Therefore, keep away from this stock, at the present moment.

Buy the shares of Simplex Projects Ltd (Rs.34.65) at around Rs.34.34.50, for targets of Rs.51-52. The stocknis on an uptrend and its sister company is doing Metro Rail project bin Bombay.


Tuesday, May 09, 2017

Buy: Telecom Stocks
An inter-ministerial committee being set up by the government to look into the financial woes of the telecom sector would have about three months to hand over its views and solutions to the government. 

According to people in the know, the panel is likely to have six to eight members, including two from the telecom department and one each from the departments of revenue and economic affairs. 

The panel would look into issues related to the sector’s financial health, which has taken a beating due to cut throat competition triggered by the entry of RJio reports the ET.

In another significant positive development: India's telecom subscriber base, mobile and landline combined, touched the 1.18 billion mark at the end of February 2017, growing 1.17 per cent over the previous month, according to regulator Trai.


Reliance Communication Ltd will now move towards Rs.40-41, Bharti Airtel (Rs.351.25) towards Rs.370-380 and Idea Cellular Ltd (Rs.87.55) towards Rs.127-130. So, the best two stocks to invest at this moment are: RCom (Rs.32.45) and Idea Cellular Ltd.

Monday, April 24, 2017

Today's Calls
1. Buy Tata Motors Ltd at Rs.442, T: Rs.471-475, SL: Rs.437.  There is some reshuffle in the management of Tata Motors.

2. Buy in Bulk the shares of Reliance Communications Ltd (Rs.34.15) as it could get merged with RJio and become a formidable player in the telecom sector. The amount of properties Reliance Industries have in Navi Mumbai (New Bombay) is of astronomical proportions. Upon merger with RIL group, the RCOM will get sufficient financial clout to take on the competition; as it will then be a part of the RJio. Therefore, buy in Bulk the shares of RCom.

3. Those who are holding the shares of Reliance Power (Rs.50.45) are suggested to keep holding as Anil Ambani Ground shares is likely to move up now. We are already witnessing good moves in Reliance Capital Ltd (Rs.612) and Reliance Infrastructure Ltd (Rs.582).

3. Buy the shares of Idea Cellular at Rs.84.80, T: Rs.91 - 101. There is nonneed to keep S L as after RJio's Paid service most of the telecom stocks are likely to zoom. Moreover, Post-merger, leverage (of the merged entity) is expected to fall gradually, while the quality of spectrum assets will rise. Even after they surrender excess spectrum, they will hold more spectrum than both Airtel and Jio. There are a host of other synergy benefits, and it turns out that a large proportion of shareholder value hinges on extracting these benefits. It is useless to spend time analysing the standalone entity as the merger is now a happening case.

Monday, April 17, 2017

Today's Calls
1. Buy Idea Cellular at Rs.85.45, T: Rs.89-91, SL: Rs..84.60. Idea Cellular to launch payments bank operations in June. The company, that recently received the Reserve Bank of India's final approval to open its payments bank, is in the process of integrating its systems with those of the National Payments Corporation of India and the RBI. Joining the network will allow it to facilitate interbank electronic transactions.

2. Sudarshan Sukhani says in CNBC TV18: "The chart of Tata Motors is horrible", but the share makes an intraday high of Rs.455.70.This only goes to show how only chart based calls are futile. I have been saying this since more than a decade, but Chartists (mostly the software sellers) fails to acknowledge this facet of trading.....😀 Anyway, if the stock manages to close above Rs.458, then we can look for targets of Rs.472-475, in the short term.

3. The worst in the telecom sector seems to be over, as RJio is now Paid. Moreover, UBS had earlier spoken of a much better quarter sequentially from Q1FY18 (June Quarter) onwards. Therefore, start accumulating Telecom stocks in bulk to reap good benefits in the short to medium term. Also the correction on RCom seems to over and one can buy the shares of RCom at Rs.34.50, T: Rs.39-41. There is no need to keep SL as the scrip of RCom is now available at rock bottom price, especially when the optimism in the sector is again returning; after almost 3-quarters of pain.
Meanwhile, there are recent media reports that the mega merger between Reliance Communications (RCom) and Aircel to create the country’s third-largest operator is entering the final phase, with both companies seeking shareholder approval in the coming days.

4. Today, the Asian markets finished mixed as of the most recent closing prices. The Nikkei 225 gained 0.11%, while the Shanghai Composite led the Hang Seng lower. They fell 0.74% and 0.21% respectively. Indians markets are today trading flat, however action is seen on beaten down Counters.



Thursday, April 13, 2017

Today's Calls
1. Buy Tata Motors Ltd at Rs.461, for short term targets of Rs.472-475, SL: Rs.457. Tata Motors' pricing strategy works with Tigor; sales crosses over 3,000 units in first month. Encouraging global volumes for its UK subsidiary, JLR, and expectations of a lower hedging loss is attracting investors. 
JLR's retail volumes grew by 21% year-on-year to 90,838 units in March 2017 due to continued sales momentum for F-Pace and gradual pick up in sales of revamped Discovery after it phased out the old model. In addition, Discovery Sport's volume grew at an unexpected 13% on a higher base. UK sales grew 27% after staying in low single digits in the past five months.Sales growth in North American, China, and Europe was 19-21%. 

2. Infosys Ltd declared satisfactory results today amidst demonetisation and US visa pangs. The software services exporter Infosys Ltd has reported consolidated profit at Rs.3,603 crore for the January-March quarter, degrowth of only 2.8% from Rs.3,708 crore in previous quarter. Revenues fell marginally by 0.88% to Rs.17,120 crore on sequential basis. However, the announcement of Rs 13,000-crore payout through dividend or share buyback during the year and fall in attrition rate is likely to lift the sentiments of Indian share markets. The company has guided its EBIT margin for the year at 23-25 percent.
The IT major has announced a final dividend of Rs 14.75 per share. Including this, aggregate dividend for financial year 2016-2017 amounted to Rs 25.75 per share, resulting in total payout of Rs 7,119 crore, it said. The Nifty spot is now trading at 9,186.85, down 16.60 points or 0.18%, but is expected to change to Green soon.

Wednesday, April 12, 2017

Today's Calls
The project development will require an investment outlay of nearly $1 billion. Financing of the project is under consideration of Asian Development Bank and a consortium of lenders, said the Anil Ambani Group company in a statement.
The markets are probably nervous before the results of Infosys Ltd. Book small intraday profits at Rs.48.50 and wait for the market to stabilize, for fresh entry in Reliance Power Ltd (Rs.48.50).

2. The shares of all telecom companies should spurt after RJio came up with new Paid Offers. The UBS has already mentioned in their research report that from Q1FY18, the fundamentals of telecom companies are set to improve. Therefore, use every dip to buy the shares of RCom (Rs.36.85), Idea Cellular (Rs.87.40) etc. Don't look at these Blue Chips on daily basis.

Tuesday, April 11, 2017

Today's Calls
Company officials asking not to be named said job cuts will help the 7,500-strong RCom integrate workforce when mergers with Aircel and MTS materialise.  When RCom announced its merger with Aircel in September 2016, the companies said cost synergies would be about Rs 20,000 crore. Costs would halve following the merger, they said. Much of this will come from job cuts since the infrastructure is already in place and it is unlikely that leasing and rental agreements will change drastically, experts said. 

2. Those who are holding Engineers India Ltd (Rs.151.50), can continue to hold with a SL of
Rs.147, for targets of Rs.171-175. Any buoyancy in oil and gas sector is positive for the stock.

3. Those who are still holding the shares of DLF Ltd (Rs.160.20) from Rs.156 and averaged during intrada dips can book some profits around Rs.160-160.70 and keep holding the rest with a SL at Rs.156.

4. My earlier recommended two steel stocks: Jai Balaji Industries Ltd (Rs.23.65) and Rohit Ferro Tech Ltd (Rs.7.20) are hitting continuous UCs since last few days. I am expecting Jai Balaji Industries to test Rs.31-32 ranges while Rohit Ferro could cross Rs.9. I would suggest a hold on both the counters.

Monday, April 10, 2017

Today's Calls
1. Buy Engineers India Ltd at Rs.150.30, T: Rs.175, SL: Rs.146. Engineers India Limited (EIL) is an engineering, procurement, engineering consultancy and construction (EPC) company in the petrochemicals and hydrocarbons industry.
The buyback price has been fixed at Rs.157 per equity share for a total aggregate of Rs 658.80 crore.  Board of Directors of Engineers India Ltd in its Board Meeting held on March 16, 2017 have declared an Interim Dividend of Rs.2.50 per share (on the face value of Rs. 5 each).

2. Those who are holding DLF Ltd (Rs.154.20) are suggested to keep a SL at Rs.153. But for medium term I would like to shift to Idea Cellular Ltd (Rs.87.40), if DLF Ltd continues to underperform.

Friday, April 07, 2017

Today's Calls
1. Buy Punjab National Bank at Rs.150.50 (BSE), for targets of Rs.157-161. Today many of my earlier recommended bank stocks (Dena Bank, UCO Bank, Federal Bank, etc) are all up; after the RBI decided to keep the repo rate unchanged.

2. Those who have entered Jet Airways Ltd are suggested to exit the counter if Rs.109 is broken on closing basis and Rs.104 is broken, intra - day.

3. Those who are holding Idea Cellular Ltd (Rs.88.40) can continue to add th scrip on declines. Today also the stock is moving up with huge volumes. The targets of Rs.123-127 are still intact.

4. Buy DLF Ltd at Rs.156-157, for very short term weekly targets of Rs.161-162.

5. Those who have been accumulating Gammon India Ltd must be happy today, as the stock touched my first target of Rs.12 and is now trading at Rs.11.70, up more than 11% intraday. The investors can do well to book profits at Rs.11.70-12 and wait for dips for re-entry.

Thursday, April 06, 2017

Today's Calls
1. Buy Jet Airways Ltd at Rs.522-534, T: Rs.542The Oil Marketing Companies (OMCs) have cut the Aviation Turbine Fuel (ATF) price by 5.2% to Rs 51,482/kL in Delhi from April 1, 2017 -- this is likely to have significant positive effects on the bottom lines of Aviation companies, like Jet Airways. Meanwhile, Jet Airways, one of the fastest growing airlines of the country, has reportedly decided to start morning flights from Bhopal to New Delhi from April 12, 2017. The company had earlier announced its plans to further strengthen its domestic network and provide guests with greater choice to connect between Metro cities and Tier-II towns.
Jet Airways is India’s premier international airline which operates flights to 67 destinations, including India and overseas. The company’s robust domestic India network spans the length and breadth of the country covering metro cities, state capitals and emerging destinations.

2. Those who are holding the shares of Idea Cellular Ltd (Rs.87) should continue to add the scrip on all declines. The Free Service of Reliance RJio is coming to an end on 15th April, 2017. This is a big trigger for the telecom sector.

Winning Strokes: Think Different
1.Today, my recommended Idea Cellular Ltd at Rs.85.10, today touched Rs.88.10 in the BSE,
before closing at Rs.87.65, up more than 3%. The stock today moved up with volume which is around 4-times yesterday's volume. Accumulate the scrip with a price target of Rs.123. Today most of the Aditya Birla group stocks were up.

2. My recommended Future Enterprises Ltd at around Rs.18-18.50, today reached my 3rd and final short term target of Rs.32 (intraday: Rs.32.60), before closing at Rs.30.70 in the BSE. The traders can book profits and invest in Idea Cellular Ltd, as the it Gets Set To Take On Airtel With Its Own Payments Bank.
3. Today Gammon India Ltd (Rs.10.28) closed above a major resistance at Rs.10.20. The investors should do well to hold the scrip with a SL at Rs.10.10. On the fundamental front, the company is doing fine. However, unless and until it closes above Rs.10.45, in both the exchanges, it may remain rangebound.

4. Today, my recommended Reliance Power Ltd (Rs.50.35) touched Rs.50.80 in the BSE. The stock was recommended around Rs.44. Those who have still not booked profits can look for targets of Rs.52-53, in the coming days. However, please keep a SL of Rs.48.60 for any short term trade.

5. Rolta India Ltd recommended at around Rs.58-59, today touched my first target of Rs.62, in the BSE. The investor can hold the scrip with 5% trailing SL.

6. Another, ADA Group company today made a huge upmove and closed above Rs.40.50, in the NSE after a long time. Those who were not so happy seeing me recommending even at near Rs.31 or near 52-week price, might be a little relieved today. The worst in the Indian telecom sector seems to be over.



Wednesday, April 05, 2017

Today's Calls
1. Buy Idea Cellular Ltd at Rs.85.10, T: Rs.123, SL: Rs.81. Aditya Birla Nuvo Ltd. has got the final nod from the Reserve Bank of India (RBI) to start a payments bank in India, the company said in a stock exchange filing on Tuesday. The stock is currently trading above its 150D SMA. Today it needs to close above Rs.85.35, to confirm its uptrend. Fundamentally the stock is ripe for investment.

2. Those who are holding Reliance Power Ltd from Rs.44 levels, are suggested to book profit st Rs.50, and wait for dips around Rs.47-47.50 for fresh entry.

Monday, April 03, 2017

Today's Calls
1. You can take fresh positions in UCO Bank Ltd at Rs.36.40, T: Rs.39-42, SL: Rs.34.70. As
long as the stock is above Rs.36.30, the bulls should not have much problems. The promoters holding in the company stood at 76.67 % while Institutions and Non-Institutions held 16.09 % and 7.25 % respectively. The scrip is currently trading above
Photo: Blomberg
its 21, 50, 100 and 150 DSMAs.
Moreover, strapped for capital, public sector banks are being asked to sell non-core assets as a way to generate funds for growth and to provision against a growing pile of bad loans. 
In another major development, the RBI has advised UCO Bank, IDBI Bank and Indian Overseas Bank to stay off risky assets so that the financial health of these lenders is not stressed further. So, the worst seems to be over for the bank. Meanwhile, the employee unions and Uco Bank management have signed an MoU for a turnaround plan, which will decide the future course of action in the bank’s recapitalization

2. Those who short term traders and have entered Saregama India Ltd (Rs.242), should note that the scrip is finding difficulty to cross Rs.244-245 ranges. One can therefore book some profits and wait for intraday dips to enter. The long/medium term investors can however, hold on with aSL of Rs.231.

3. Fresh positions can be initiated in Tata Motors Ltd at Rs.469, T: Rs.610, SL: Rs.465. The company said its wholly owned subsidiary TAL Manufacturing announced that BRABO-- the first Made-in-India robot -- has received “CE” certification for commercial sale in the European market.

4. Those who are holding the shares of the construction major, Gammon India Ltd (Rs.10) should add in intra-day dips. This stock is likely to give multi-bagger returns in the short to medium term.

Friday, March 31, 2017

Today's Calls
1. Fresh positions can be initiated in Reliance Power Ltd at Rs.48, T: Rs.54, SL: Rs.46. I have been recommending the scrip since Rs.42-43 levels. Now after a brief consolidation the scrip is expected to move up.

2. Yesterday, Saregama India Ltd (Rs 336.50) crossed Rs.240, intraday; today also it touched Rs.244. However, it seems the stock will consolidate around Rs.232-244, before starting the next up.one. The investors can take their trading decisions accordingly.

3. Gammmon India Ltd ( Rs.9.75), has made a bottom of sorts. The investors are suggested to buy in bulk the shares of this construction major.

4. My recommended Reliance Defence and Engineering Ltd (Rs.68.25) today made a high of Rs.69.90, which is near my target of Rs.72.

5. Suzlon Energy Ltd (Rs.19.25), recommended at around Rs
7-8, today made a 52-week high of Rs.19.85. The traders can now look for target of Rs.22, I'm the coming days.

6. Buy Jet Airways Ltd at Rs.529, T: Rs.592, SL: Rs.482. The stock is on a major uptrend. Jet Airways and Air India will benefit from the ban imposed by the US government on large electronic devices from cabin luggage on passenger flights from eight Muslim-majority countries, as business travellers prefer to work on laptops and iPads while on long-duration flights, industry executives told ET. 

Thursday, March 30, 2017

Today's Calls
1. Buy Saregama India Ltd at Rs.231-233, T: Rs.290 - 300, SL: Rs.225. According to some
media reports: Saregama, a company from the RP-Sanjiv Goenka group, is turning a new leaf, betting on new technology and its legacy — a huge portfolio of Indian music, with 1.17 lakh tracks. 
Moreover, Saregama India Ltd's share of Indian music Industry is 11% and the Music Industry's growth till 2016 was 100% in four years. Not only that even the expansion of Radio Stations is positive for the shareholders of Saregama India.

2. Those who are holding Rolta India Ltd (Rs.59) could see the scrip touch Rs.71-72 in the short to medium term. So keep accumulating in dips.

3. Those who are holding the shares of Gammon India Ltd can look for immediate targets of Rs.12 - 12.50, as GST gets implemented by July, 2017.

4. Buy Allahabad Bank Ltd at Rs.73.05,  T: Rs.82 - 86, SL: Rs.72.60. 
The Board of Directors of Allahabad Bank had approved raising of BASEL III compliant Additional Tier 1 Perpetual Bonds aggregating up to Rs.1000.00 crore through Private Placement.
The Bank has on March 17, 2017 successfully raised additional Tier 1 (AT 1) capital of bank through private placement of AT1 Perpetual Bonds aggregating to Rs. 300 crores (including green shoe option of Rs. 100 crores) at an annual coupon of 11.15% p.a., discovered through electronic bidding mechanism of NSE (NSE EBP). Meanwhile, the BANKEX is now trading at  24503.73 up 101.79 points or 0.42%.

5. Buy UCO Bank at Rs.36.10, T: Rs.39 - 41, SL: Rs.35. There is no need of SL, as the stock should steadily move up, following the Bankex. UCO Bank on 29 May, 2017 announced that its board has approved raising Rs.1,000 crore through issuance of tier 2 bonds to LIC.




Wednesday, March 29, 2017

Today's Call
1. Those who are still holding the shares of Reliance Defense and  Engineering Ltd, can
continue to add on declines. The scrip is entering the F&O segment, which is expected to give it the required bounce.
Reliance Infrastructure estimates Indian defence business opportunities at Rs.15 trillion over a 15-year period and offset export opportunity at Rs.77,000 crore.

Ambani’s entry into the defence business started with its acquisition of Gujarat-based Pipavav Shipyard about two years ago The Pipavav Shipyard has now been renamed Reliance Defence and Engineering Ltd.
In February, Reliance Infrastructure formed a strategic partnership with Dassault Aviation to form a joint venture, Dassault Reliance Aerospace Ltd, to execute offset contracts worth up to Rs.30,000 crore, the firm said. India had signed an agreement with France to buy 36 Rafale fighter jets from Dassault Aviation.
Moreover, as long as it is above Rs.61.65, there should not be much problem for the bulls. The short term targets of Rs.71-72, are still intact.

2. If IVRCL Ltd (Rs.4.95) does not close above Rs.5 today, then exit the counter, as there could be some problem with the company which, perhaps the market knows.

3. Accumulate the shares of Gammon India Ltd (Rs.10.10) as the company is on the path to recovery, as is evident from the last quarter results.

4. Those who are holding the shares of Tata Motors Ltd (Rs.473.80) can continue to add on declines. Many brokerage houses are bullish on the scrip.

5. Rolta India Ltd is giving opportunities for medium to long term investors for big gains. Accumulate at Rs.58.20, for targets of Rs.97-103.

5. Making money from the market on consistent basis, has become very difficult since last 9-10 months, especially after demonetisation; even for experts. Therefore, if you are a new comer, always consult veterans in this game. Whether, you follow their suggestions or not is a different issue, but at least please do take time to hear the voices of experts in complex trades.

Monday, March 27, 2017

Today's Calls
1. Buy Gammon India Ltd at Rs.10.20, T: Rs.12, SL: Rs.8.70. The stock of Gammon Infrastructure is up more than 5% today. The company reported a narrower losses for the December quarter. Mumbai-based Gammon India Ltd posted a standalone loss of Rs.20.53 crore for the three-month period that ended on December 31, 2016, compared with Rs 119.06 crore for the corresponding period a year ago.

2. Those who are holding IVRCL Ltd (Rs.5.05) should continue to add on intra day dips. The infrastructure stocks will now run up.

Saturday, March 25, 2017

IVRCL Ltd: Some Thoughts
CMP: Rs.5.05
Photo: Indian Tollways
The Hyderabad based infrastructure player IVRCL Limited will get Rs.400 crore from the sale of three road projects (Salem Tollways Limited, Kumarapalayam Tollways and Chengapalli Tollways) -- Of this it will receive Rs.315 crore by 31 March and the balance in September 2017, according to some sources.

Though lenders are reluctant to give new loans, last year it was sanctioned a fresh non-fund credit of Rs.1,800 crore in bank guarantees and letter of credit, in addition to a cash credit limit of Rs.200 crore as part of the CDR deal.

The company has an order book of around Rs.18,000 crore.

Apart from monetising the assets, there are six more in line, it has decided to focus on realising the claims amounting to over Rs.6000 crore from various government projects. 

The company wants to utilise the new arbitration law that brings down the time limit for the settlement of a commercial dispute, for this purpose.

At a joint lenders forum meeting for IVRCL, banks had earlier decided to invoke strategic debt restructuring. Around Rs.7,500 crore worth of loans given to IVRCL has been converted into shares by bankers, including State Bank of India and IDBI Ltd, allowing them to own 51%.

SDR allows banks to convert debt into equity and make management changes if the company fails to achieve certain milestones.

Last year the company said: 
“Pursuant to provisions of Companies Act, 2013 and Sebi (Issue of Capital Disclosure Requirement) Regulations, 2009 and implementation of SDR, the company has made an allotment of 6,46,810 equity shares at a price of Rs.8.765 each, to Bank of Nova Scotia".

Those banks that hold a stake in the company are Andhra Bank ICICI Bank, Indian Overseas Bank, IDBI Bank, Canara Bank and Corporation Bank. Now this prove of Rs.8.765 somewhat forms a datum for future price discoveries.

Now that Banks have already taken control of IVRCL Ltd, the Hyderabad-based construction company and have converted loans into equity, it makes sense to find a buyer sooner rather than later.

The infrastructure fund of multi-asset manager IDFC Alternatives has been one of the most active buyers of operational road assets in India, ahead of peer investors including US-based I Squared Capital and Canada’s Brookfield Asset Management.


On the other side, Piramal Enterprises Ltd, controlled by billionaire Ajay Piramal, which said in 2014 that it was looking to buy a number of road assets, is yet to announce a deal.

The Indian infrastructure sector has an estimated capacity to absorb $1 trillion. India plans to invest almost Rs4 trillion in the next financial year in creating and upgrading infrastructure.

According to a report last year by investment bank Ambit Corporate Finance and the City of London, global pension funds and sovereign wealth funds may invest up to $50 billion in India’s infrastructure sector over the next five years.

Meanwhile, the A$127 billion (Rs6.4 trillion) Australian Government Future Fund is looking to invest in the Indian infrastructure space, including roads, telecommunications and clean energy.

Recently there were media reports that Infrastructure Leasing and Financial Services Ltd (IL&FS) has partnered with global private equity (PE) firm Lone Star to jointly invest in stressed infrastructure projects in India.

Lone Star Funds and IL&FS have collaborated to jointly invest $550 million, which could result in asset purchases of up to $2.5 billion, the companies said in a joint statement.

A interesting point to note is that on November 2008, the Maharashtra (state) PWD, then headed by former minister Chhagan Bhujbal, had proposed to widen the 20 km Sion-Panvel Highway (Mumbai -- Navi Mumbai connectivity) with a new toll naka at Kamothe (Navi Mumbai). In June 2009, a tender notice was issued and the IVRCL-Kakade Infrastructure Pvt Ltd (KIPL) joint venture—Sion-Panvel Tollways Ltd—bagged the contract by offering the lowest viability gap fund of Rs 390 crore. Now KIPL is owned by BJP MP Sanjay Kakade. So, at present IVRCL Ltd (Rs.5.05) has some Narendra Modi (BJP) connections -- both at the centre and in Andhra Pradesh, we have NDA rule.

In mid-February, Finance Minister Arun Jaitley presented his 2017 Union Budget to the Parliament where he outlined his plan for infrastructure and railways.

The funds allow state-owned Indian Railways to modernize its infrastructure and service operations, which includes laying 3,500 kilometers of new tracks in the coming year (2017-18) and feeding 7,000 stations with solar power in the medium term. Jaitley also announced a new Metro Rail Act to streamline existing laws, and allow greater private participation in construction and operation. It is to be remembered that IVRCL Ltd is also a player in the Railway sector.

India's infrastructure development is set to accelerate and meet global benchmarks even if the private sector is not in a hurry to grab the vast investment opportunities that are opening up, top cabinet ministers said at the Economic Times India Infra Summit 2017.

The government has set an ambitious target of laying roads up to 40 km per day in the country. Till February in FY16-17, about 6,500 km of roads construction has been done, seeing a growth from the previous financial year, when just 6,000 km of roads have been laid.

Therefore, we can look forward for the buy out of the stressed assets IVRCL Ltd soon. investors can therefore accumulate the scrip of IVRCL Ltd in dips, for Short term targets of Rs.8-9.




Friday, March 24, 2017

Today's Calls
1. Buy Reliance Defense and Engineering Ltd at Rs.63.70, T: Rs.72-78, SL: Rs.61. The stock
Photo: The Economic Times
has now entered into the F&O segment.

2. Those who still holding the shares of my recommended Suzlon energy Ltd (Rs.19.10), can look for targets of Rs.21-22, in the coming days. This scrip has also entered in the F&O space.

3. Those who have entered JSE Energy Ltd (Rs.62.25) yesterday at around Rs.60.80, can continue to hold with a SL of Rs.59. Recently, there were some positive developments in the company.

4. Buy Hindustan Oil Exploration Ltd at Rs.72.70, T: Rs.78-82, SL: Rs.68.60. The Union Cabinet’s decision on Wednesday to grant extension to production sharing contracts for 10 blocks will benefit Cairn India Ltd (CIL), Oil and Natural Gas Corporation (ONGC), Essar Oil, Focus Energy, Hindustan Oil Exploration Company (HOEC), and Gujarat State Petroleum Corporation Ltd (GSPC).
The contracts for these pre-NELP (New Exploration Licensing Policy) exploratory blocks will be extended for 10 years from the expiry of their contracts. The move, the government said, will help accelerate indigenous production of hydrocarbons from existing blocks and act as a progressive step towards achieving the target of 10 per cent reduction in import of crude oil by 2022.


5. Those who have entered the turnaround infrastructure major, IVRCL Ltd (Rs.5.20), can look for targets of around Rs.7-8, in the coming days.  IVRCL Ltd is now basically (majority stake) owned by a consortium of lenders (Banks), hence accumulated debt is no longer a big problem. However, what seems to be a little bothering is working capital requirements.
Moreover, since the conversion price is around Rs.8.765 (~Rs.9), hence the scrip is likely to move towards this new found datum.