Mangalore Refinery and Petrochemical Ltd: Buy

CMP: Rs.48.95

At the loading of MRPL’s first International solid cargo of Sulphur at Jetty #3 NMPT.

Introduction: 

Please Click on the Photo to Expand

MRPL, a schedule ‘A’ CPSE and a subsidiary of ONGC is a State of Art Grassroot Refinery located in a beautiful hilly terrain, north of Mangalore city, in Dakshin Kannada region. The Refinery has got a versatile design with high flexibility to process Crudes of various API and with high degree of Automation.

MRPL has a design capacity to process 15 million metric tons per annum and have 2 Hydrocrackers producing Premium Diesel (High Cetane). It also has 2 CCRs producing Unleaded Petrol of High Octane. MRPL produces special grade, ash less petcoke, ideal for cement kilns as the end product in their state of art Delayed Coker Unit (DCU) commissioned in April 2014. TheDCU converts low-value ‘short residue’ (bottoms) into high-value products viz Gasoil, Naphtha, LPG etc thereby increasing the distillate yield. Around 30% gets converted into special grade pet coke, which is in demand in the country.

Shareholding Pattern: 

The promoters hold 88.58%, while the general pubiic holds only
11.42%. Among the general catagory, the institutions hold 3.64%, FIIs hold 0.67% and DIIs hold 2.97% of the shares of the company. In fact the FIIs' holding has increased marginally both on Q-o-Q basis and sequentially. The non-institutions  hold only 7.78% shares of the company leaving very little shares in the open market for trade. 

Triggers: 

• In December, the Mangalore Refinery and Petrochemicals Ltd 
  
  (MRPL) entered into a MoU with STC Mauritius and Indian Oil Corp (IOC) to set up a petroleum terminal at Mauritius. The JV terminal would be constructed at an investment of around $130 million to facilitate re-export of petroleum products from Mauritius to Indian Ocean Islands and mainland Africa.
• The company has fully commissioned all units of phase-III, other than polypropylene unit, which will be fully functional by the March quarter of FY15. With that the phase-III expansion will be completed. 
• The completion of phase-III expansion of the refinery, single-point mooring system near New Mangalore Port, and facilities at OMPL (ONGC Mangalore Petrochemicals Ltd) are some of the recent milestones achieved by the company. Moreover, the first dispatch of OMPL product has gone from the company to respective customers in Q3FY15. MRPL is also one of the stakeholders in the OMPL project.  All these milestones would help improve the refining margin of the company. This will help bring better returns for stakeholders. 
• The company initially had plans of setting up of retail outlets. Accordingly, its BOD had approved the proposal for the establishment 122 outlets a few years ago. However, the company is not implementing, at the present moment, because it needs to revalidate that decision within its own team. 
• The commissioning of single-point mooring system near New Mangalore Port last year has helped the company to bring crude oil in bigger vessels.
• MRPL reported not so encouraging GRMs both in Q1FY15 and Q2FY15. This may come to end in the coming quarters as the phase III expansion completes and the plant stabilizes. Historically, MRPL has reported higher and more stable GRMs than the other PSU refineries. Now with most issues easing away and the secondary units getting commissioned by FY15E, the GRMs of MRPL is likely to bounce back in the coming months. 
• MRPL's Phase III is in the final stage of completion and is expected to be fully commissioned soon, as mentioned above. This refinery expansion & upgradation project at Mangalore includes: - (1) capacity addition of 3 MMTPA and upgradation project (2) polypropylene unit and (3) single point mooring (SPM) facility. 
• During Q1FY15, the company commissioned the delayed coker unit (DCU), that will crack the residual fuel oil into gasoil and petcoke, coker hydro treater unit (removes sulphur impurities from diesel) & two out of three SRU units. The PFCC (converts vacuum gasoil to propylene) & one train of SRU are expected has already been commissioned last year (CY14). Higher complexity on commissioning of Phase III project will lead to an increase in distillate yield from 76.5% to 80.1%, better capability to handle heavier & sourer crude and production of higher margin value-added products. 
• This month, MRPL announced that it moved its very first international solid cargo of Sulphur aboard MV Dusita Naree from NMPT Jetty #3. The loading of the 16500MT of ‘solid Sulphur’ headed to ZHENJIANG Port in China, commenced on 2nd Jan 2015 and was completed by 6th January 2015. The customer, M/s Mitsui& Co had bid online for the 16500MT of ‘solid Sulphur’ generated from the Phase I, II &III Sulphur Recovery Units of MRPL. Solid Sulphur is the by-product of the process by which desulphurization of auto-fuels is carried out to make these fuels environment-friendly EURO grade products. MRPL today manufactures EURO IV grade of petrol/diesel and is equipped for commercial production of EURO V. At a time of increasing concern at the potential for oversupply in the sulphur industry, particularly because of the increases in China’s sulphur capacity, the MRPL shipment is positive news for the sector and shows that China is still a key customer for the mineral.
• Overall, MRPL has lower policy leverage and lowest gearing on the balance sheet amongst PSU refineries. Moreover, the fuel loss which was a drag during the last few quarter may come down in the immediate future due to commissioning of new projects. This will lead to better GRMs.

Conclusion: Looking at the daily candle stick chart we find that the the stock has given a clear break-out above Rs.48.7. The scrip even closed above its 21D, SMA and EMA. 

This stock therefore, becomes a must buy for the investors at the current price of Rs.48.95. We can look forward for a target of Rs.55-62, in the coming days. The short term traders can keep a SL of Rs.45.

MARKET MANTRA

Veer Energy and Infrastructure Ltd (Face Value: Re.1 and not Rs.10) today touched Rs.4.54 and is now trading at around Rs.4.40. The traders who have entered earlier can book some profits and wait for the scrip to stabilize, before taking a fresh entry. The long term investors however can hold the scrip with a SL of Rs.4.20. 

Today's Call: (i) Buy Gitanjali Gems Ltd at Rs.52.70, for a target of Rs.61-62. With the marriage season commencing, the demand for Gems and Jewelries are set to increase in the coming days. Meanwhile, there were media reports that Gitanjali Gems Ltd. (GITG), India’s largest jeweler by revenue, has registered three new trademarks in that country, the Rapaport Report diamond news website reported. The three new trademarks, approved Dec. 22, are “Gitanjali Jewels,” “Giganjali Group,” and ‘Gitanjali Trust Forever,’’ according to the Rapaport Report. The Mumbai-based company said in its application that it has used the terms since July 2011, according to the diamond-industry trade publication. Gitanjali Group was founded in 1977 as a diamond-cutting and polishing operation and has since grown into a diamond and jewelry company, according to the Rapaport Report.
(ii) Buy Mangalore Refinery And Petrochemical Ltd at Rs.49.70-50, for a target of Rs.61-62, in the short term. The medium term target for the scrip is Rs.80. SL-Rs.46.50.

CHART CHECK

The current support for the Nifty has shifted to 8620-8630 levels, after it closed at 8,723.85 with a gain of 28.2 points, yesterday. According to some well known chartists, on the medium term basis any dip till 8430 could be a good buying opportunity for an upside upto 8750 zone. 

Which means today, it could be  day of Mid and Small Cap counters and traders are suggested to focus on this space more. However, if the Nifty slips below 8500, then it could retest 8420-8370 zone once again. 

Brokerage Report: Macro-Economic and Other Domestic / International News

(i) India may see current account surplus after 7 years: Nomura

India may see achhe din on the capital account front with analysts predicting a surplus for the first time in more than seven years as falling crude oil prices and lesser gold imports would ease the pressure on the country's trade balances.

Photo: PTI

"Based on the current trends, we expect India's current account balance to turn positive for the fourth quarter of FY15,"  CAD was 2.1% of GDP in the quarter ended September 30, a fivequarter high, on slow exports growth and rise in imports owing to a rise in demand for gold. India had last seen a current account surplus of $4.2 billion (1.6% of GDP) in the fourth quarter of 2006-07.

(ii) India's growth to reach 6.3% in 2016 

UN report India will see a gradual growth acceleration with its GDP expected to reach 5.9% this year and 6.3%t in 2016, the UN said today while partly crediting the recovery to improved market sentiment after the new government took office and announced key reforms. "India's economy expanded by an estimated 5.4% in 2014, an improvement from growth of 5.0% recorded in 2013, but still significantly below the 8.0% pace of the pre-crisis period," said the United Nations World Economic Situation and Prospects 2015 (WESP).

(iii) China GDP Growth Stable In Q4

The Chinese economy expanded at a stable rate in the fourth quarter, defying expectations for a slowdown. GDP grew 7.3% in the fourth quarter from a year ago, same as in the third quarter. This was the weakest growth since the first quarter of 2009. However, the increase was stronger than the 7.2% rise forecast by

economists. QoQ, GDP rose by a seasonally adjusted 1.5%, slower than the 1.7% increase expected by economists. 

(iv) Japan Consumer Confidence Rises More Than Expected In December

Consumer confidence in Japan increased more than expected in December, figures from the Cabinet Office showed. The consumer confidence index rose to 38.8 in December from 37.7 in the previous month. Economists had forecast the index

Cement stocks outperform markets

[Editor:  The report says that while large-cap Cement scrips have rallied 8-16% so far this year, mid-cap ones have gained 10-26%. But, I feel this will not be restricted to only cement counters, but is expected to spread to areas related to the Real Estate/ Construction space, eg. Steel, Wood, Aluminium, Copper, etc. We are already witnessing rallies, in some of the well known metal shares, including my old favourite, HINDALCO Ltd (Rs.144.40)]

New Delhi / Mumbai  January 20, 2015: Cement stocks have started the year on a firm note, with most outperforming the markets on hope of an improvement in sales and a pick-up in construction activity.

While large-cap stocks such as UltraTech Cement, ACC, Ambuja Cements and Shree Cement have rallied 8-16 per cent on the BSE this year, against a five per cent rise in the benchmark Sensex, mid-cap stocks such as Prism Cement, Heidelberg Cement India, OCL India, Birla Corporation and India Cements have gained 10-26 per cent.

“We have seen a rise in cement prices across India post December. As a result, cement stocks gathered momentum. Going ahead, we remain positive on the sector from a one-year horizon. There is a lot of capacity in place, which augurs well if the demand increases on the back of an improvement in the overall economy. We continue to favour Mangalam Cement and have a ‘buy’ recommendation on the counter,” said Sunil Jain, vice-president (equity research), Nirmal Bang.

In seven of the past 10 years, the sector outperformed the broader markets in the January-March quarter, owing to retail price increases, prominent in the peak construction season, reports suggest.

Between January and March last year, the UltraTech Cement, Shree Cement, ACC, Prism Cement, JK Cement and JK Lakshmi Cement stocks had gained 25-40 per cent, according to data compiled by Business Standard Research Bureau. During the same period, the Sensex gained 5.7 per cent.

Demand dynamics

After a decline in October 2014 due to the festive season and unavailability of labour, cement demand started recovering from November, led by a revival in construction. With an uptick in prices and an improvement in demand, analysts remain positive on the sector from a long-term perspective.

In the quarter ended December 2014, cement prices fell Rs 10-15 a bag in north India due to weak demand, non-availability of labour and the festive season.

In the south, prices were hit by monsoons and Cyclone Hudhud, reports suggest. Average prices in south India fell Rs 5-10 a bag. While prices fell Rs 10-12 a bag in western India, prices in the eastern parts of the country largely remained flat.

Analysts expect demand to improve, led by increased spending on housing in rural and semi-urban areas and an improvement in orders for infrastructure projects.

Given the demand triggers through the next two-three years (led by government investments), Mihir Jhaveri and Prateek Kumar of Religare Institutional Research expect prices to remain buoyant.

They maintain a positive outlook on the sector, estimating compounded annual growth of 9-10 per cent in demand during FY14-FY17.

Any weakness due to a moderate third quarter of FY15 should be used as an opportunity to accumulate cement stocks, they said in a recent report.

Tina Virmani, an analyst tracking the sector at Kotak Securities, however, says though cement stocks are trading at fair valuations, any weakness in these should be used to buy selectively. She continues to be positive on Grasim Industries and Shree Cements.

Courtesy: Business Standard

We moved ordinance in order to revive mining industry: Steel & mines Minister Narendra Singh Tomar

[Editor: Meanwhile, Amit Harchekar, Chief Technical Strategist at A PLUS Analytics recommends going long in Tata Steel with a target of Rs.430. This means the momentum has started to be built around the Steel Sector. Moreover, in a interview published in Free Press Journal on Jan 02, 2015, the Union minister for steel and mines, Narendra Singh Tomar said, "At present, there is an increase in the prices of iron ore, because of the shortage of the material. These prices are also impacted by global conditions, however due to the domestic scarcity of iron ore, the prices have shot up and the steel industry has been gripped by a crisis. So, the industry is facing a tough time as it has to source the iron ore at higher prices. This is the fate of large units. In so far as the smaller units are concerned, their position is all the more difficult. The situation has been complicated by the fact that in the same period, China has dumped the market with both iron ore and steel. The fact of global competition is also a reality. We are also  working in collaboration with the finance ministry to look at options to control dumping from China"]

Photo: In.com

20 Jan, 2015: Minister of steel and mines, Narendra Singh Tomar spoke to ET's Meera Mohanty in an interview, explaining the need for the recent ordinance amending the MMDR Act of 1957 that introduces the auction of non-coal minerals. The minister needs to balance the demands of the mining industry and its key end user, the steel sector. He defended the decision to allow existing leases that are more than 50 years old an extension until 2020 and 2030 in the case of captive mines. The ministry believes 199 areas, mostly limestone, would be ready for auction soon. Edited excerpts:

Was it necessary to amend the MMDR through an ordinance?

The MMDR Act was introduced way back in 1957. The previous government had attempted to introduce a new bill but it had lapsed. In the last few years, the issue of first-cum-first-served had also been raised by the Supreme Court. The MB Shah commission had also been critical of certain practices that it said were illegal. The result was that officials both in the state and at the Centre were worried about issuing any orders under a system that in itself was in question.

We had planned to introduce the Amendment Act in the winter session. However, by the time we had stakeholder and interministerial (consensus) — I personally met several chief ministers — the session had drawn to a close. Since the need to revive mining industry was pressing, we moved it as an ordinance . When it is provided for by the constitution, and it will only strengthen the economy, why doubt it. There is nothing circumventive about it. At the end of the day, it still must be cleared by Parliament.

To what extent will this simplify issues ailing the sector? And how do you react to charges that it takes away powers from the states?

In fact, this is a historic step towards decentralisation of the Centre's powers in the area of mining. For instance, , it removes the need of prior approval of the central government — which was required for notified minerals in the First Schedule earlier — except in the case of atomic minerals.

For mining plans, a provision has been made that if any state government, with approval of the Centre, institutes a mechanism with the help of third parties, for mining plans, certification and monitoring, then the plan accorded through such a mechanism can be the basis of allocation of a mining licence (ML).  Provision has been made for the central government to prescribe timelines. The Centre may intervene, exercising its revisionary powers, only in the event of a state not a taking a timely decision.

The life of a mining lease has been increased from 30 years to 50 years, doing away renewals. There was ambiguity in the earlier Act with regards to second and subsequent renewal. We know that only a few concessions (after the Supreme Court order) were granted during last year and most were pending owing to indecision of state and central government this too has been addressed. The new law allows for transfer ML and PL (prospecting licence)-cum-ML awarded through auction, which was major concern of the industry.

Will the coal auction mechanism form a template?

We are open to explore all possible mechanisms. The broad similarity with the coal ordinance is provision of a financial bid. In the ordinance we have provided for, inter-alia, a production-sharing model. However coal is nationalised. Here since states will be conducting the actual auction, we wanted their feedback and buy-in to the rules and regulations that will be drafted. (The minister met with 11 state ministers of mines and their respective secretaries on January 19.) 

Would you be providing a weightage to steel, aluminium users?

Under section 10B(6) of the new ordinance, the central government has the right to reserve a particular mine or mines for a particular end use. We will be identifying select mines for "limited auction" for end users, subject to certain eligibility conditions.

Reconnaissance, and rights thereafter, has been a persistent demand particularly of global mining giants and that hasn't been provided.

The ordinance allows for grant of nonexclusive reconnaissance permit to aid and help global miners. 

Courtesyy: The Economic Times

After surprise cut, RBI asks banks to review lending rate quarterly

Photo: Impact Design and Drafting

Jan 20, 2015: Following its interest rate cut last week after nearly two years, the Reserve Bank (RBI) on Monday asked banks to notify the base, or minimum, lending rate at least once every three months based on cost of funds.

"As hitherto, banks are required to review the Base Rate at least once in a quarter with the approval of the board or the Asset Liability Management Committee (ALCO) as per the bank's practice," the RBI said, issuing new guidelines on interest rates on advances.

Commercial banks currently do not maintain a fixed schedule for review of the base rate. While the new guidelines will come into effect from Feb 19, banks will not be allowed to change their methodology during the review cycle.

"While computing Base Rate, banks will have the freedom to calculate cost of funds either on the basis of average cost of funds or on marginal cost of funds or any other methodology in vogue, which is reasonable and transparent provided it is consistent and made available for supervisory review/scrutiny as and when required," RBI said.

The notification also said it has been decided to allow banks to review the Base Rate methodology after three years from date of its finalizing instead of the current period of five years towards greater operational flexibility.

"Accordingly, banks may change their Base Rate methodology after completion of prescribed period with the approval of their Board of Directors/ALCO," it said.

Courtesy: First Post

Need to address problems arising out of Carbon dioxide emission: Suresh Prabhu

Photo: Motherboard

[Editor: Assured of government’s backing, the Indian wind power industry has ended ending the year, 2014 on a high note. India has taken nearly a quarter century to create wind power capacity of 22,200 MW. But now, Power Minister Piyush Goyal wants the industry to ramp up installations, so that the capacity additions in 2018-19 are 10,000 MW. The most the industry added in any year was 3,168 MW in 2011-12. The government has been supporting the renewable energy sector: (i) the grant of the industry’s long-standing request for restoring the tax-saving ‘accelerated depreciation’ duty, and (ii) exemption from 4 per cent special additional duty on imported components for wind turbines. Moreover, according to some media reports, on the works there is a proposal to impose a ‘renewable generation obligation’ that will force companies putting up coal or lignite based thermal power plants to create an additional 10 per cent of their project capacities as renewable energy plants. This is expected to give that ‘extra push’, as cash-rich public sector companies such as NTPC, NLC and DVC might quickly come up with large wind (or solar) projects. Having given the industry all it wanted, the government is now gesturing: “go, do it”. In 2014-15, India will see wind power capacity additions between 2,000 MW and 2,500 MW, roughly the same as last year. Meanwhile, Motherboard, wrote on 13 October, 2014: 

A leaked report shows that wind is the hands-down cheapest energy source in Europe, beating the presumably dirt-cheap coal and gas by a mile. Conventional wisdom holds that clean energy is more expensive than its fossil-fueled counterparts; politicians who oppose incentives for solar and wind routinely point to their cost as an omnipresent hurdle. Yet truly honest cost comparisons show that renewable energy sources are often cheaper than their carbon-heavy competition. The report, which was prepared for the European Commission, shows as much: it demonstrates that if you were to take into account mining, pollution, and adverse health impacts of coal and gas, wind power would be the cheapest source of energy, period] 

New Delhi | January 20, 2015: Union Minister of Railways, Suresh Prabhakar Prabhu on Tuesday said it was imperative that problems and challenges arising out of carbon dioxide emissions are addressed approximately.

The Minister released a book "Carbon Capture, Storage and Utilization (CCSU)" which deals with the issue of mitigating climate change concerns arising out of emission of carbon dioxide in atmosphere.

It is a collection of papers prepared by eminent authors. R.V. Shahi is the Former Power Secretary, Govt. of India, Malti Goel, Former Advisor in the Ministry of Science and Technology, and M. Sudhakar, Advisor/Scientist, Ministry of Earth Sciences.

Prabhu said that the Ministry of Railways is the biggest consumer of energy in the country. While it mostly uses electricity and diesel but now using alternate sources of energy like wind, solar, CNG and Bio fuels.

Referring to the energy scenario in the country, he said that while India is making vigorous efforts to use alternate sources of energy like solar energy, wind geo thermal, bio fuels but our dependence on fossil fuel will continue for many years.

Global efforts in this direction, particularly during last ten years, have raised some optimism that in coming years Carbon Capture and Storage could become a reality and very soon thereafter could even become cost effective. All efforts have to be mobilized to see that these technologies become relevant for developing economies to adapt.

It should be the responsibility of developed economies to share the findings of various researches, so that these become affordable for developing economies. Indian Industry and Research Institutions have also to do and contribute much more than they have been doing so far.

Courtesy: Webindia123.com

Sensex, Nifty close at record highs; metal, banking stocks gain

Photo: Indiacsr.com

Mumbai, Tuesday, January 20, 2015: Rising for the fourth straight session, India’s equity markets closed at record highs, led by gains in metals and banking companies. 

Investors also hoping that the European Central Bank may announce a 550 billion euro ($640 billion) bond purchase programme on 22 January, Bloomberg reported. 

Earlier in the day, the National Stock Exchange’s Nifty index rose as much as 1.84%, or 157.20 points, to hit a record high of 8,707.90 points, while the Sensex rose as much as 2.01% or 567.28 points to 28,829.29 points. 

At the close of trading, Sensex was up 1.85%, or 522.66 points at 28,784.67 points, while the 50-share CNX Nifty of the National Stock Exchange was up 1.69%, or 144.90 points, at 8,695.60 points. 

“There has been a lot of optimism after RBI’s rate cut last week, and the reforms process is also expected to catch up speed, propelling the market to new highs,” said Dipen Shah, head of private client group research at Kotak Securities Ltd. 

“If the government announces further fiscal reforms, within or outside of budget, valuations can rise further,” added Shah. 

The sentiment was also upbeat as the International Monetary Fund (IMF) said India is projected to outpace China by growing 6.5% against the 6.3% growth expected for its northern neighbour in fiscal year 2016-17—the third year of the Narendra Modi government—becoming the fastest growing major economy in the world. 

Among the gainers, Housing Development Finance Corp. Ltd (HDFC) rose 5.8% to its record high of Rs.1,250.50, Sesa Sterlite Ltd rose 5.4% to Rs.203.50 and Tata Steel Ltd rose 4.5% to Rs.402.10. 

Among the losers, Gail India Ltd fell 1.9% to Rs.432.05 and Tata Power Co. Ltd fell 0.9% to Rs.82.05. Among sectoral indices, the BSE metal index was the top sectoral gainer, up 3%, followed by the Bankex, FMCG, oil and gas and realty indices, which were up 1.8%, 1.7%, 1.3% and 1.2% respectively. BSE Teck and auto indices were up 0.7% each while the capital goods, healthcare and IT indices were up 0.5% each. 

Metal shares were the key gainers in Tuesday’s trade.

“The metal index went up as Chinese growth rate was better than expected,” said Shah of Kotak. Jindal Steel and Power Ltd rose 3% to Rs.155.4, JSW Steel Ltd 3% to Rs.1,005.40, Hindalco Industries Ltd 3% to Rs.144.4 and Hindustan Zinc Ltd 0.8% to Rs.161.60. 

Kesoram Industries Ltd rose 20% to Rs.137.30 and MRF Ltd 0.1% to Rs.39,494.65 after The Economic Times reported that MRF is in advance discussions with BK Birla flagship Kesoram Industries Ltd to acquire its main tyre unit out of the two of Birla Tyres for a value that’s far higher than the market capitalization of the entire diversified Birla conglomerate. So far in 2015, the Sensex has gained 4.67%, while foreign institutional investors have bought $155.7 million from local equity markets and bought $2.02 billion from the debt market.

Courtesy: Live Mint

WINNING STROKES: THINK DIFFERENT

Today Veer Energy and Infrastructure Ltd touched Rs.4.15, intra-day before closing at Rs.4.07. The scrip today moved up with huge volume in the BSE. The volume of the shares traded today was 1,185,534, against 10 and 30 and day average volumes of 162184 and 166237 shares, respectively. And what is more interesting and positive for the BULLS is that, the percentage of Deliverable Quantity to Traded Quantity was whopping 82.81%, which is even higher than yesterday. Today, the stock gave a clear break out and closed above some of its prominent "Moving Averages'. The stock in all probability will touch Rs.5 in this week. Congratulations to those who are holding the scrip. The share was recommended yesterday to the Premium Group members at Rs.3.30-3.50.

My recommended Allied Digital Services Ltd today touched Rs.34.55, before closing at Rs.30.90, after profit booking was suggested in the counter. The scrip reached all its short term targets. 
Meanwhile, I do not know whether you have observed or not: Kohinoor Broadcasting Corporation Ltd (Re.0.22) is hitting continuous upper circuits since the last few days. It seems this time the scrip will touch Re.0.50, let us see......

Rohit Ferro Tech Ltd (Rs.8.10) today, closed above Rs.8 forming slightly positive pattern for the bulls. The company is selling one of its plants (The unit is located at Kalinganagar industrial Complex, District: Jajpur, Orissa) and trying to reduce the debts. It is also implementing the CDR SCHEME. You should buy the scrip when no one is looking at it, but has a story to tell.  Meanwhile, according to The Economic Times, January 5, 2014: 

India is expected to become the world's second largest producer of crude steel in 2015-16, moving up from the fourth position, as its capacity is projected to increase from 100 million tonne (MT) to about 112.5 MT in 2015-16. "All indicators suggest that India will soon move up to the second position both in production and consumption", a sectoral analysis by Frost & Sullivan's Metals & Mining Practice said. 

With infrastructure development and automotive industry driving steel demand, production is expected to hit 140 MT by the end of 2016, while consumption is expected to grow 6.8% to reach 104 MT by 2017.

According to the analysis, the Indian steel industry is forging ahead despite "chronic handicaps like poor infrastructure". It said, "The government is working proactively to provide incentives for economic growth by injecting funds in construction, infrastructure, automotive and power, which will drive the steel industry in the future."

With nearly all major domestic steel producers in the process of adding a mix of brownfield and greenfield capacity, the total planned capacity hike in crude steel production till 2017 is estimated at well over 100 MT. While total installed capacity for crude steel in 2013 was 102 MT, capacity utilisation was about 80%.

Moreover, according to India Ratings & Research (Ind-Ra), the average prices for steel making raw materials are likely to remain low in 2015, in line with 2014, as major global miners are determined to flush small, high-cost producers out of the industry and regain balance in the market. The agency expects steel consuming sectors construction, automobile and mechanical engineering - to grow in FY16 with the softening of interest rates and implementation of government policies on the revival of infrastructure and investment in the country. A better GDP forecast of 6.5% growth in FY16 supported by industrial growth of 6.5% would gradually increase steel demand in the country. Besides, there were media reports today that, according to sources, the steel ministry has sought a revision of import duty on long products and HR coils saying it is necessary to raise import duty rates to safeguard TMT/rebar industry. You should therefore, not only buy the shares of Rohit Ferro Tech Ltd, but also average out or take fresh positions in Jai Balaji Industries Ltd (Rs.15.50). One should remember that without steel, Infrastructure development is not possible. 

Anant Raj Ltd today closed flat at Rs.46.85, in the BSE, after touched Rs.47.75, intra-day. Recently, the company announced that the Credit Analysis & Research (CARE) Limited has reaffirmed the credit ratings of the Company as 'CARE BBB+ (Triple B Plus)’ for the long term bank facilities of Rs.951.32 Crores and outstanding Non Convertible Debentures (NCDs) issue of Rs.150 Crores, which had been issued by the Company on private placement basis. The stock should see Rs.55-57, in the coming days.

Climate Change: PM Modi for credit to green initiatives

Photo: Ayyati.com

New Delhi, JAN 20, 2015: Pitching for a paradigm shift in the global approach towards climate change, Prime Minister Narendra Modi today said instead of only focussing on emission cuts, due credit should be given to efforts made for clean energy generation and conservation.

Underlining that focus should shift from “carbon credit” towards “green credit”, he singled out solar energy, saying it needs to be integrated with hybrid system of energy to make it useful.

He favoured setting up of a consortium of nations having potential in solar energy which could join hands with India in innovation and cutting-edge research that would reduce the cost of solar energy, making it more accessible to people.

Chairing the first meeting of the reconstituted ‘Prime Minister’s Council on Climate Change here, PM Modi said that “instead of focussing on emissions and cuts alone, focus should shift on what we have done for clean energy generation, energy conservation and energy efficiency, and what more can be done in these areas,” a PMO statement said.

He called for a careful evaluation of all the initiatives that have been taken by India in this regard.

These include initiatives in solar energy, wind energy, biomass energy, and transportation projects that have reduced distances or travel times.

PM Modi said India looks at the global concern and awareness on Climate Change, as a great opportunity for working towards improving the quality of life of its citizens, and making a positive contribution for mankind.

He also directed ministries to prepare a concept note on five uncovered areas — health, urban waste management, coastal areas and wind energy — while dealing with climate change as these are not covered under the ongoing missions.

“The ministries concerned have been asked to work on these new areas and prepare a concept note in the next four-five months. Once the concept is finalised, the funds will allocated accordingly,” a source said.

Courtesy: NITI Central

Market Mantra

Veer Energy and Infrastructure Ltd touched Rs.4.15, intra-day and is  now trading at Rs.4.01 in the BSE. Yesterday, the percentage of Deliverable Quantity to Traded Quantity was whooping 78.15%. The total quantity traded in the BSE was 5,21,576 and in it the Deliverable Quantity was 4,07,611.  Today, the volume of the shares traded in the BSE has already crossed one million (10 lakhs). Earlier there were media reports that, Shruti Power Projects Pvt Ltd, a wholly-owned subsidiary of Veer Energy & Infrastructure Ltd,  was sanctioned a loan of Rs.52.56 crore by the Indian Renewable Energy Development Agency (IREDA). This loan was sanctioned for setting up a 12 MW wind farm project, worth Rs.75.60 crore, at Vinjalpur village, Khambhalia (Gujarat). The new project is expected to generate additional revenue of Rs.12 crore per annum to the company by way of power generation. Veer Energy & Infrastructure is also expected to take the benefit of generation based incentive (GBI) as per the policy declared by the central government. The scrip should be hitting the buyer freeze today, by the end of the day. 

Anant Raj Ltd, the real estate giant and having huge land bank today might have completed the consolidation phase.  The scrip should now move up and we can look forward for a target of Rs.55-57 in the short term. The company earns huge income from leasing.

 Make in India will revive metal industry

Photo: Live Mint

Jamshedpur, Jan 19: Indian Institute of Welding and Tata Steel will jointly orgainse a National Welding Seminar from Jan 22 to 24.

At the event around 400 delegates of which 130 local and more than 250 from various industries across India will participate, said said Suresh Kumar, Vice-President (shared services), Tata Steel.

Addressing a press conference at Institute of Engineers, Kumar said that today, with the country’s focus on concepts like Make In India and Self-Reliance in various high technology based industries like space technology, defence, aviation, petrochemical, shipping, railways and basic infrastructure, India is poised for a quantum jump and the coming years will witness a lot of activities in the field of mining, manufacturing and transportation.

This also means that many new grades of Steel and different alloys need to be developed in the country and used for critical components for defence, heavy transport vehicles and other infrastructure related projects thereby creating a need for specialised consumables and technologies for joining by welding, cutting and cladding.

This presents a challenge to the welding fraternity to come-up with matching technologies & skills to meet the requirement of construction & manufacturing industry.

With new Indian government focusing on Make in India, newfound confidence within the manufacturing industry is expected to boost demand for metal stamping as retail sales improve Growth in the industry is expected to pick up as more manufacturing sectors order more equipment, including the automotive and aerospace industries.

Alongside, he said, a Welding Technology Exposition will also be organized at G Town ground were 43 stalls will be put up including 7 of AAIDA were national and International welding consumable and equipment manufacturing companies will be showcasing their latest welding equipment, consumables and related technologies, which would help the local industries learn about the latest technology and get exposure as to where we stand when comparing to the rest of the world.

M Shome further informed that eight international speakers including from USA, UK, Japan will take part in the seminar, which was being organised in the steel city after a gap of two decades. 

At the event 110 technical papers will be presented by various engineering, research, educational and manufacturing organizations. A B Lall, Plant Head, Tata Motors will be the Chief Guest at the inauguration of the Welding Technology exposition ‘Weld-India 2014-15’ and S L Deoras, Managing Director, TRF Ltd. will grace the inaugural function of ‘National Welding Seminar 2014-15’ as Chief Guest.

Also present at the press meet were Sanjay Kedia and Arijoy Roy.

Courtesy: The Avenue Mail 

India's Iron and Steel exports rise to US$ 705.14 M in December- 2014

Photo: South China Morning Post

New Delhi, Delhi, January 19, 2015: InfodriveIndia.com, India's premier research company in export import market research, announced today that India's Iron and Steel exports in December- 2014 has grew to US$ 705.14 M a increase of 38.13% compared to November 2014.

New Delhi, Delhi, January 19, 2015 /India PRwire/ -- InfodriveIndia.com, India's premier research company in export import market research, announced today that India's Iron and Steel exports in December- 2014 has grew to US$ 705.14 M, a increase of 38.13% compared to November 2014.

This finding is based on India Iron and Steel export data of InfodriveIndia.com and is based on export shipping bills filed at Indian customs by exporters from India through December- 2014 at more than 170+ ports in India like JNPT, Bombay Air and Sea, Chennai Air & Sea, Delhi IGI Air, Delhi Tughlakhabad ICD, Delhi Patparganj, Kolkata Air and Sea, Bangalore Air and many more. InfodriveIndia.com India Iron and Steel Export database is considered to be the most comprehensive, up-to-date and authentic information on India's foreign trade of Iron and Steel.

According to Pradeep, Chief Research Associate of InfodriveIndia.com, compared to November 2014, a increase of USD 705.14 M in December- 2014 has been noticed. He further gives a analysis and break up of major product categories, major countries and major Indian ports under Iron and Steel as follows :

A. Exports of Flat-Rolled products of Iron or Non-Alloy Steel of a width of 600 Mm or more, Clad and Plated or Coated has grew month on month basis by 35%.

Total value of exports in December- 2014 was 177.42 M, compared to November 2014, there is a increase of 45.99 M in December- 2014, growth rate in percentage terms is 35%, the major destination countries were United States, United arab Emirates, Italy, Iran and Portugal and major Indian ports were JNPT, Bombay Sea, Goa Sea, Calcutta Sea and Magdalla.

B. Exports of has grew month on month basis by 183.7%.

Total value of exports in December- 2014 was 148.36 M, compared to November 2014, there is a increase of 96.07 M in December- 2014, growth rate in percentage terms is 183.7%, the major destination countries were Iran, United arab Emirates, Italy, Malaysia and Taiwan and major Indian ports were Goa Sea, Magdalla, Vizag Sea, Madras Sea and Raxaul.

C. Exports of Ferro Alloys has fallen month on month basis by -6.02%.

Total value of exports in December- 2014 was 110.54 M, compared to November 2014, there is a decrease of -7.08 M in December- 2014, growth rate in percentage terms is -6.02%, the major destination countries were Japan, Netherlands, Iran, Korea, Republic of and Italy and major Indian ports were Calcutta Sea, Vizag Sea, Paradip, Madras Sea and Nagpur.

D. Exports of Flat-Rolled products of Iron or Non-Alloy Steel of a width of 600 Mm or more, Cold-Rolled not Clad and Plated or Coated has grew month on month basis by 102.99%.

Total value of exports in December- 2014 was 55.49 M, compared to November 2014, there is a increase of 28.15 M in December- 2014, growth rate in percentage terms is 102.99%, the major destination countries were Italy, Belgium, Thailand, United States and Costa Rica and major Indian ports were Goa Sea, Calcutta Sea, Magdalla, JNPT and Vizag Sea.

Pradeep says that the above information is on major product categories, and users requiring detailed analysis and reports on their specific products can contact Sales team at InfodriveIndia.com with detailed description of their product, brand names and its uses.

According to Pradeep, usually InfodriveIndia.com team delivers most of the projects within 3 working days.

InfodriveIndia.com analysis and research is done from export statistics from Indian customs which is based on export shipping bills filed at various ports, InfodriveIndia reporters collect this data from every Indian port, and InfodriveIndia database yields the most timely, accurate, comprehensive information available on trade through India Ports. Recently after a long and persistent lobbying with Indian Govt, InfodriveIndia.com has been able to release export import data almost on realtime basis, bringing the backlog time to just 3 days, compared to Govt sources which are around 6 months old. Another unique feature of InfodriveIndia.com database is unparalleled coverage of 170+ ports in India.

Courtesy: Info Drive

Govt to boost public spending on infrastructure

Photo: The New India Express

NEW DELHI, an 20, 2015 - India will increase public spending on infrastructure, Finance Minister Arun Jaitley said on Monday.

The government estimates the country needs to spend $800 billion on infrastructure to grow 7 percent per annum, sharply higher than around 5.5 percent projected by the Reserve Bank of India for the current fiscal year that ends in March.

Concerned over slow economic growth, some government aides are also pushing to row back on fiscal deficit targets when Jaitley announces the 2015/16 budget next month. They have advocated more spending on infrastructure projects that could lift growth.

Courtesy: First Post

WINNING STROKES: THINK DIFFERENT

Allied Digital Ltd hit the buyer freeze yesterday and closed at Rs.32.85. The scrip reached all my short term target of Rs.31-32. It is time to book short term profits and wait for the scrip to stabilise before fresh positions can be taken. However, medium term investors can look for a target of Rs.41. 

Veer Energy and Infrastructure Ltd (Rs.3.49) was recommended yesterday, after there were news reports that FPIs/FIIs are shifting to this sector. The scrip moved up with huge volume yesterday and closed with a gain of 10.79%, after touching an intra-day high of Rs.3.65. Moreover, the percentage of Deliverable Quantity to Traded Quantity was whooping 78.15%. The total quantity traded in the BSE was 5,21,576 and in it the Deliverable Quantity was 4,07,611. This shows that the investors are entering the scrip in bulk. Since the stock is near its 52-week low price and hence the downside is limited with the current set of fundamentals. Its 52-week high price is Rs.7.64 made on 12/06/2014. Earlier there were media reports that, Shruti Power Projects Pvt Ltd, a wholly-owned subsidiary of Veer Energy & Infrastructure Ltd,  was sanctioned a loan of Rs.52.56 crore by the Indian Renewable Energy Development Agency (IREDA). This loan was sanctioned for setting up a 12 MW wind farm project, worth Rs.75.60 crore, at Vinjalpur village, Khambhalia (Gujarat). The new project is expected to generate additional revenue of Rs.12 crore per annum to the company by way of power generation. Veer Energy & Infrastructure is also expected to take the benefit of generation based incentive (GBI) as per the policy declared by the central government.

The stock of HOUSING DEVELOPMENT & INFRASTRUCTURE LTD, which was recommended around Rs.66-67, a couple of weeks back, yesterday touched Rs.81.15. The scrip is expected to cross the next target of Rs.84, within 30 days.

Rohit Ferro Tech Ltd (Rs.8.07) fell with low volume yesterday, indicating the end of the downtrend. The scrip could shoot up at any time as it has expressed its intent to divest its stake in one of the group companies. The investors are strongly suggested to buy the scrip at this safe price. There cannot be an infra-boom, without a corresponding rise in the stocks of the building materials. 

Suzlon Energy Ltd reached my 2nd target of Rs.17, as the scrip touched an intra-day high of Rs.18, before closing at Rs.17.45. The next medium term target is Rs.20, which the scrip should amble in the next 30 days. But my suggestion for safe traders would be, to shift to either Veer Energy Ltd (Rs.3.49) or to the diversified firm, PVP Ventures Ltd (Rs.7.65).. 

Veer Energy and Infrastructure Ltd: Buy

Engaged in the wind energy business, Veer Energy is planning to come up with 40 mw Grid-based Solar Power Infrastructure project on the 200 acres land at Kutch in Gujarat. 

Earlier there were media reports that, Veer Energy has signed Expression of Interest with one of World's leading wind turbine manufacturer for sale of an exclusively, indefeasible right to use the transmission rights granted by GETCO for Power Evacuation of 30 MW WTG, along with government waste land allotted to Veer Energy on lease basis by Hon. Collector for setting up wind farm.

It has a book of Rs.6.08 and has a market cap of only Rs.25.61 Cr at the CMP of Rs.3.57. Also it is a dividend paying company.

One can buy the scrip at around Rs.3.30-3.50 for a target of Rs.5, in the short term. The scrip is today moving up with good volumes. The volume of shares traded in the BSE is nearing half million (414138 shares traded till 12 noon) in the first hour of trade against the 2 (two) week Average Quantity of 1.30 lakhs. 

Since Suzlon Energy Ltd (Rs.17.30) is moving up, by logic this should also move up, albeit with a slightly better fundamental. 

Overseas portfolio investors shift money to banks, infrastructure and oil companies 

[Editor:  Meanwhile, the CII Director General, Chandrajit Banerjee, said that, “The reduction in repo rate has come as a positive surprise in the New Year and would be a huge mood lifter for investors who have been grappling with subdued demand conditions.” He further said, “Even though symbolic, it would send a strong signal down the line that both the government and the RBI are acting in concert to harness demand and take the economy to a higher orbit of growth. A rate cut would propel investment demand, spur spending in rate sensitive consumer durables and give a fillip to construction activity.”]

MUMBAI, 19 Jan, 2015: Overseas portfolio investors are changing their India strategy. While cutting stakes in more than a fourth of the companies they are invested in, fund managers have shifted bets from technology and commodity-linked sectors to banks, infrastructure and oil companies amid expectations the Reserve Bank of India (RBI) will cut rates further, having already done so on January 15. 

Foreign institutional investors' holdings in the quarter ended December 31, 2014, have fallen from the preceding quarter in 120 of the 460 companies in which they have stakes. About 60 companies have witnessed an increase, according to an ET study of shareholding patterns in 1,200 companies. 

hough FIIs cut stakes in more companies than they invested, analysts said data show they preferred to keep the money in India, a reflection of their confidence in the economic revival. 

In the quarter, they reduced stakes in large-caps, including Reliance Industries, Tata Steel, Infosys, Tata Power, Cairn India, Adani Enterprises, Tech Mahindra, IndusInd Ban, Suzlon Energy and Biocon. Hero Moto-Corp, BPCL, HPCL, Axis Bank, SBI, ICICI Bank, and Kotak Mahindra Bank are among the 60 stocks in which they increased stake. "Now, India is tilting towards the domestic story from the exports story. Many exportrelated stocks are stagnant, while banks and financial companies will ride the next... wave. 

FIIs, too, would go with the wind," said Raamdeo Agrawal, joint managing director, Motilal OswalBSE -0.58 % Financial Services. "There is a change in FIIs' India investment pattern from IT and commodities stocks to interest rate-sensitive stocks, which are early beneficiaries of a lower rate regime," said Samir Arora, fund manager, Helios Capital. 

FIIs invested about Rs 900 crore in October 2014, and Rs 14,300 crore in November 2014, but turned net sellers in December 2014 to the tune of Rs 965 crore. Fund managers said technology and commodity-linked companies have fallen out of FII favour because of stagnant growth and an uncertain outlook. 

FIIs are moving away from companies that are growing in single digit but trading at rich valuations. 

"Foreign investors are now focused on inexpensive banks, financial institutions and some of the infra stocks that are going to benefit in the long term from the government's new initiatives and the interest rate reversal cycle," said UR Bhat, managing director, Dalton Capital. 

FIIs' favourite in the quarter was Hero MotoCorpBSE -1.81 %, in which they increased their stake to 39.34% from 34.34%. They raised their holdings in HPCLBSE -1.28 % and BPCLBSE -0.72 % by 4.82% and 2.63%, respectively, to record levels following the sharp fall in crude oil prices globally and domestic diesel price deregulation. 

"This makes clear that foreign investors have changed their strategy for Indian markets. 

They sold holdings in underperformers and fundamentally weak companies, including a few big companies, but instead of taking money out of India, they invested in banks, NBFCs (non-banking finance companies) and select midcaps," said Arun Kejriwal, founder and CEO, Kris Research. 

For the second consecutive quarter, FIIs cut their stake in Reliance Industries — to 18.90% from 19.46% on September 30, 2014. In mid-caps, FII holding in KPIT Technologies fell from 24.79% to 14.42%. Some of the other stocks in which FII holding fell include Amtek Auto, Tilaknagar Industires, Hindustan Oil Exploration, Aban Offshore, Lanco InfratechBSE -2.83 % and GVK Power, among others. 

Courtesy: The Economic Times