SumanSpeaks: The Information Super Highway

Indian Real Estate Market: Some Thoughts Photo : Don R. Campbell The Indian real estate market has seen a huge boom in the past decade thanks to a growing urban middle class population. Major real estate companies are targeting developable areas and turning them into construction marvels. Real estate in India has been severely impacted by the global economic meltdown, leading to stressed assets that have affected buyers as well as developers. Incomplete or delayed projects, depleted financial resources and unutilised land parcels point towards the urgent need for innovative solutions to break the logjam. The solution lies in tackling the ‘stressed assets’ and reviving the real estate sector. India’s real estate sector witnessed a boom in 2004-08 leading to a proliferation of commercial office space and retail mall space when companies and investors were lapping up every announcement/launch. Faced with a long time-gap cycle between purchase of land and delivery of produc...

JSW Energy Ltd: Buy CMP: Rs.77.90 The stock of JSW Energy Ltd after correcting significantly from Rs.126 in a year, is trying to consolidate and look up now. Though major concerns due to subdued demand and realisations, and increasing debt led by acquisitions, still remains.  JSW Energy sells power through combination of long-term and short-term Power Purchase Agreements (PPAs). JSW Energy Ltd's management in June, 2016 said: “For sale of its power, the company participates in bids sought by power procurers and has participated in a recent tender floated by Power Company of Karnataka Limited (PCKL) in which bids were opened yesterday and thereafter the bids are to be evaluated, processed and approved by various authorities prior to placement of any order/contract”.  The company further made the clarification with reference to the news flashed on CNBC TV 18: "JSW Energy is second lowest bidder in Karnataka SEB PPA and may get 750MW PPA contract. Rate can be...

DLF Q1 profit jumps over 2-fold to Rs 261.42 cr [ Editor : The real estate sector started with a bang, as the realty major DLF Ltd came out with a reasonably good Q1FY17 result. This is expected to bring more optimism in the space, and attest to the fact that after a long time, perhaps the real estate sector is looking up, albeit with hiccups on the way.   The real estate sector is one of the most globally recognised sectors. In India, real estate is the second largest employer after agriculture and is slated to grow at 30 per cent over the next decade. The Indian real estate market has become one of the most preferred destinations in the Asia Pacific# as overseas funds accounted for more than 50 per cent of all investment activity in India in 2014, compared with just 26 per cent in 2013. The Indian real estate market is expected to touch US$ 180 billion by 2020. The housing sector alone contributes 5-6 per cent to the country's Gross Domestic Product (GDP).   ...

Important Photo : Financial Express (i) After a long time Reliance Communications Ltd moved above Rs.54 today; following news in a Business Channel. This kind of news keeps on popping up but at the end nothing happens. Therefore, the short term traders are suggested to book profits at around Rs.54.50. However, long term traders can keep holding the scrip with  a SL of Rs.46. (ii) You can keep on adding the shares of JSW Energy Ltd for a short term target of Rs.84-85. Three years ago, JSW Energy’s market capitalization was a third that of Tata Power Co. Ltd and three-fifths that of Adani Power Ltd. Tata Power’s and Adani Power’s installed power generating capacities then were 2.7 times and 1.7 times bigger, respectively, than JSW Energy’s. With its latest 500 megawatt (MW) power plant purchase, JSW Energy’s capacities have almost doubled from back then. Tracking the rise, the company’s market value has jumped 90% during the period to Rs.13,333 crore. Capacities at T...

Important (i) After a long time Reliance Communications Ltd moved above Rs.54 today; following news in a Business Channel. This kind of news keeps on popping up but at the end nothing happens. Therefore, the short term traders are suggested to book profits at around Rs.54.50. However, long term traders can keep holding the scrip with  a SL of Rs.46. (ii) You can keep on adding the shares of JSW Energy Ltd for a short term target of Rs.84-85. Three years ago, JSW Energy’s market capitalization was a third that of Tata Power Co. Ltd and three-fifths that of Adani Power Ltd. Tata Power’s and Adani Power’s installed power generating capacities then were 2.7 times and 1.7 times bigger, respectively, than JSW Energy’s. With its latest 500 megawatt (MW) power plant purchase, JSW Energy’s capacities have almost doubled from back then. Tracking the rise, the company’s market value has jumped 90% during the period to Rs.13,333 crore. Capacities at Tata Power and Adani Power al...

IVRCL Ltd: Buy CMP: Rs.4.93 (BSE) and Rs.4.90 (NSE) Click on the Photo to Expand IVRCL Ltd is a leading engineering, procurement and construction (EPC) and infrastructure company. Founded over 25 years ago, the company has been involved in various projects related to water and environment, transportation, buildings and industrial structures, power transmission projects and mining. It is listed on the BSE and NSE and employs more than 3,000 engineers, managers and professional technocrats. IVRCL Ltd’s operations cut across geographical frontiers of the sub-continent, with headquarters in Hyderabad and administrative offices in Chennai, Cochin, Bangalore, Pune, Kolkata, Jodhpur, Raipur (Chattisgarh), Ahmedabad, Margao (Goa), Jind (Haryana), Udhampur (J&K), Billaspur (MP), Kotdwara (Uttaranchal) & New Delhi besides liaision offices setup near project sites. The company is known, among other things, for construction of the first desalination plant at Minjur (near C...

Important (i) Those who have entered Shrenuj & Co Ltd can continue to hold with a SL of Rs.1.95 (which is not likely to break). The company is having an office in a posh location in Bandra, Bombay. Most of the directors are overseas scouting for funds. The consortium of lenders are co-operating and soon a debt restructuring news might come in the media. The next target is Rs.3.05. (ii) Those who are holding the shares of JSW Energy Ltd (Rs.78.50) can continue to add on declines. With its latest 500 megawatt power plant purchase, JSW Energy’s capacities have almost doubled from three years ago. JSW Energy Ltd comes under infrastructure space.  (iii) The investors can continue to add the shares of Unitech Ltd (Rs.5.30) on all declines, as the ensuring festive season, is likely to give the required buoyancy to the real estate sector. Moreover, the company's annual report would probably be ready by 12 September, 2016. (iv) Today, most of the shares in the infr...

Important (i) The short term traders can exit Bharat Heavy Electricals Ltd at Rs.136, as it has broken Rs.137. If it Photo : CanStock Photo gets support around Rs.132, then buy or else wait for the price to stabilize. For the long term you can hold with a SL of Rs.107. (ii) The short term traders can exit Adani Enterprise Ltd as it has broken Rs.75. You can again accumulate around Rs.67-68, where it might get some support. If it goes below Rs.67, then long term traders can forget the counter. (iii) Accumulate Unitech Ltd (Rs.5.05) and IVRCL Ltd (Rs.4.80), because the construction activities are about to start post monsoons.  (iv) Reliance Communications Ltd (Rs.51.80) is moving on the hope of any merger news. But unless it closes above Rs.53.50, there is no hope. In such circumstances, the short term traders can book profits as it moves up, till it closes above Rs.53.50, where you can again start accumulating. (v) Those who have entered Syncom Formulations Ltd (...

Shrenuj & Co Ltd: Updates Rs.2.27 (BSE) and Rs.2.25 (NSE) The 100-year-old diamond house and one of the largest in the trade, Shrenuj & Co has survived across four generations. In 1989, Shrenuj & Co was one of the first gems and jewellery companies to be listed on the BSE and had introduced laser technology to diamond manufacturing in the '80s.  The company has cutting and polishing diamond facilities in Botswana and Johannesburg, in addition to existing ones in Mumbai and Patna. The company procures rough diamonds from overseas, cuts and polishes them and makes diamond jewellery.  There was news that in the ET,. 29 June, 2016:  Banks, with a combined exposure of around $450 million, has obtained court order to repossess the inventory - stock of diamond lying with the company - and restrict travel of the promoters..... Trade circles attribute the problems faced by the group to aggressive expansion overseas even as rough diamond prices...

Bharat Heavy Electricals Ltd CMP: Rs.139 Photo : The Economic Times State-run Bharat Heavy Electricals (Bhel) is an integrated power plant equipment manufacturer. It is one of the largest engineering and manufacturing companies in India engaged in the design, engineering, manufacture, construction, testing, commissioning and servicing of a wide range of products and services for core sectors of the economy, viz. power, transmission, industry, railways, renewable energy, oil & gas, water and defence. The Government of India currently holds 63.06% stake in the company as per the shareholding pattern as on 30 June 2016. Bharat Heavy Electricals (Bhel) last month, successfully commissioned the third unit of the 160 megawatts (MW) Teesta Low Dam Hydro Electric Project (HEP) Stage-IV in West Bengal. The greenfield project located in Darjeeling district of West Bengal, Teesta HEP is being set up by National Hydroelectric Power Corporation (NHPC), on the River Teesta. The fou...

Do you know? Rolta Power Pvt. Ltd. is part of the more-than-three-decades-old Rolta Group business interests in Real estate, investments and IT. Rolta Power is headquartered in Mumbai and is a new entrant in the Rolta Group fully owned by Rolta Pvt. Ltd. Recently, Rolta Power Pvt. Ltd. and China-based Zhenfa New Energy Science and Technology Co. Ltd. has signed an agreement to build solar parks in India, targeting a capacity of 2 GigaWatt by 2020.

Reliance Defence and Engineering Ltd CMP: Rs.66.10 Reliance Defence & Engineering formerly Pipavav Defence and Offshore Engineering Company is into building defence warships and is an integrated defence, heavy engineering and offshore oil & gas assets' construction company. Reliance Infrastructure together with its wholly owned subsidiary Reliance Defence Systems ealier completed the acquisition of erstwhile Pipavav Defence. The mandatory open offer to acquire up to 26% shares from the public shareholders of Pipavav Defence was at a price of Rs 66 per share, which is close to the CMP of Rs.66.10.   The erstwhile, Pipavav Shipyard was the first corporate shipyard to be granted clearance to build warships and other vessels for the Indian Navy, though the initial licence limits this to up to 5 ships per year.  On March 26, 2015, the Company successfully implemented one of the biggest debt restructurings in India. Pipavav raised additional debt o...

Some Encouraging Points Concerning the NDA government (i) Foreign direct investment during October 2014 and May this year grew 46 per cent to USD 61.58 billion after the launch of Make in India programme. To further boost investment environment and bring in foreign capital, the NDA government is taking various measures like opening up FDI in many sectors, carrying out FDI related reforms and improving ease of doing business. (ii) Sectors that attracted maximum FDI include services, trading, automobile and power.  (iii) The NDA government has approved as many as 259 proposals for setting up of special economic zones relating to IT/ITeS and electronic hardware sector in many parts of the country. During the last four years and the current financial year (up to July 15), the Board of Approval, under the ministry, gave more time to as many as 139 developers of SEZs, including the IT/ITeS sector, to complete their projects.  (iv)  Some of the biggest ...

Adani Enterprises Ltd CMP: Rs.75.50 The Adani Group has grown to become a global integrated infrastructure player with businesses in key industry verticals - resources, logistics and energy. The integrated model is well adapted to the infrastructure challenges of the emerging economies. The company said that its coal business, ports and power businesses continue to scale up steadily. Further, improved utilization of operational capacity has resulted in robust overall performance. Key Statistics:  Face Value of the shares: Re.1 Book Value of the shares: Rs.121.98 Enterprise Value (22-Aug-2016): Rs.269.37 billion (Rs.26,937 Cr) as against a market cap of only Rs.8309.07 Cr P/E: 8.11 against the industry P/E of 18.96 EPS: Rs.9.32 Dividend: 40% 52-week low/high: Rs.58.45/Rs.101.90 Adani Enterprises Ltd, the flagship company of Adani group, reported a flat consolidated net profit of Rs.363.71 crore for the quarter ended June 30, 2016. The company had posted a ...

Adani Enterprises Ltd CMP: Rs.75.50 The Adani Group has grown to become a global integrated infrastructure player with businesses in key industry verticals - resources, logistics and energy. The integrated model is well adapted to the infrastructure challenges of the emerging economies. The company said that its coal business, ports and power businesses continue to scale up steadily. Further, improved utilization of operational capacity has resulted in robust overall performance. Key Statistics:  Face Value of the shares: Re.1 Book Value of the shares: Rs.121.98 Enterprise Value (22-Aug-2016): Rs.269.37 billion (Rs.26,937 Cr) as against a market cap of only Rs.8309.07 Cr P/E: 8.11 against the industry P/E of 18.96 EPS: Rs.9.32 Dividend: 40% 52-week low/high: Rs.58.45/Rs.101.90 Adani Enterprises Ltd, the flagship company of Adani group, reported a flat consolidated net profit of Rs.363.71 crore for the quarter ended June 30, 2016. The company had posted a co...

Shrenuj & Co Ltd CMP: Rs.2.17 (BSE) Photo :  India Today Shrenuj & Company Ltd manufactures and markets high quality polished diamonds and diamond jewellery products. The company in June, 2016 said that as a part of strategy, it has undertaken an exercise to rationalise its manpower across all levels. As a result, some of employees have started tendering their resignations, it said. Shrenuj said it is putting its every effort to retain the best talent in the organisation. Alternative strategies are being considered to overcome the current challenges, the company said. Shrenuj & Company reported net loss of Rs.38.32 crore in Q4 March 2016, compared with net profit of Rs.2.50 crore in Q4 March 2015. Net sales declined 62.9% to Rs.304.16 crore in Q4 March 2016 over Q4 March 2015.  Some key statistics:  (i) The Book Value of the shares of the company is Rs.47.38 (ii) The dividend yield per share at the CMP of Rs.2.17 is 9.22%. (iii) ...