WINNING STROKES THINK DIFFERENT:

Buy Unitech Ltd at the CMP of Rs.30 for a target of Rs.37---Rs.42 in the next 30 days time frame.

THE REAL ESTATE AND CONSTRUCTION STOCKS ARE EXPECTED TO HAVE A FIELD DAY (GOOD DAY), IN THE DAYS TO COME DUE TO LOWER COST OF STEEL, CEMENT, ETC. WHICH ARE KEY RAW MATERIALS FOR THIS SECTOR.

Banking stocks are oversold and may bounce back if the market sustains above 2770.

Unitech Ltd should move up with the good news generated some days back......

Buy Oil Exploration companies as the Crude Oil price is rising in the International markets. Selan Exploration Technologies Ltd will start buy back of the shares of the company at a price not more than Rs.230 (two hundred thirty) per share, whose CMP is Rs.122, from 23 rd January, 2009; this is expected to boost the share price of the company. The company has cost per barrel as only $15 and hence the company is making huge profits even at this rate of Crude Oil.

New Delhi: India’s second-largest real estate company Unitech Ltd on Monday said it has repaid or rescheduled nearly three-fourths of its Rs 2,500-crore loans due by March 2009. “The overall debt that we need to repay by March 2009 is now reduced to just 20-25 per cent of the earlier amount of Rs 2,500 crore. So by March, we have to repay about Rs 600 crore,” Unitech’s Managing Director, Mr Sanjay Chandra, told reporters on the sidelines of the company’s EGM in Gurgaon.

Of the outstanding debt that is now due by March, about 60 per cent is from banks and the remaining from Mutual Funds.

Unitech, on Saturday, “prepaid” a substantial portion of the Rs 900 crore borrowed from 7-8 mutual funds, while the balance amount has been rolled-over and is not due this fiscal. Besides this, the company claims to have rescheduled debt of over Rs 1,000 crore. Mr Chandra, however, refused to divulge the specifics.

Unitech had earlier stated that it hopes to mobilise up to about Rs 4,000 crore through the sale of some assets and equity in order to repay a part of the company’s overall debt of Rs 8,400 crore (as on Q2 FY09). The company had said that this will be achieved by raising about Rs 1,200-1,500 crore through a sale of hotels and office properties; and Rs 1,000 crore from Private Equity funding into residential projects.

In addition, following the pact with Telenor, the telecom arm (Unitech Wireless) would repay debt to the tune of Rs 800 crore to Unitech Ltd. And another Rs 1,200 crore worth of loans would get transferred from the erstwhile consolidated balance sheet of the Unitech Group, to Unitech Wireless’ new balance sheet.

Borrowing profile:

According to Mr Chandra, Unitech is also looking to convert nearly Rs 2,500 crore of short-term debt into long-term borrowings. “We are changing the borrowing profile from short to long term debt, and from mutual funds to banks and financial institutions,” he said, adding that the rate of interest on fresh loans has come down to sub-14 per cent against a maximum of 17-19 per cent earlier.

Meanwhile, at the company’s EGM on Monday, shareholders approved raising of additional long-term funds up to Rs 5,000 crore through issue of additional securities. The company has said this is an “enabling resolution”, and has been necessitated due to the expiry of a similar resolution earlier. But the company did not comment on how it would raise the funds or the quantum of promoter equity that could be diluted in the process.

Mr Chandra also refuted reports that the company had withdrawn a mixed-use commercial project in Orissa. “We had originally planned the project on land worth Rs 200 crore, but given the market conditions we have decided to go with land worth only Rs 52 crore. The Government is considering giving us the proportionate land,” he said.