Tuesday, November 30, 2010

RBI Circular: Alterations/Corrections on cheques effective 1st December, 2010

RBI vide their circular dated 22^nd June, 2010 had prescribed certain guidelines with respect to alterations/corrections on cheques with a view to minimize incidents of cheque frauds on account of alterations to various fields on the cheques and thus provide protection to the customers as well as the banks.

These guidelines will now be effective from 1^st December, 2010.

As per the said guidelines, 'no changes/corrections should be carried out on cheques(other than for date validation purposes, if required). For any other change whether in respect of the payee's name, courtesy amount(amount in figures) or legal amount(amount in words) etc., fresh cheque forms should be used.

In line with RBI directives under the said guidelines, as and from the Effective Date any cheque bearing such alterations or corrections will not be accepted by the Banks at the time of deposit/presentation and are likely to be dishonoured.

Necessary precautions may therefore be taken to avoid dishonour of such cheques.

Monday, November 29, 2010

Shipping Corporation of India FPO

Shipping Corporation of India Ltd (SCI) is the next PSU FPO offering that is going to hit the market after MOIL IPO, Coal India IPO and Power Grid FPO.

SCI is offering initial public offer of 84,690,730 equity shares of Rs10 each for sale on November 30. The offer will close on December 03.

FPO of Shipping Corporation of India Ltd (SCI) provides an opportunity to invest in country's one of the largest shipping companies in terms of Indian flagged tonnage. The company is committed to maintain its leadership position and it intends to leverage upon it to enhance relationships with existing customers and to seek new customers. It has plans in place to add vessels in its existing fleets to further diversify and to garner market share. The company is well positioned to take advantage of growth in India's oil refining, power and steel industries. The company intends to improve operating efficiency, service quality and competitiveness by taking various measures. It has a strong balance sheet. At the higher end of the price band, the company is valued at discount to its peers. The issue is available at a discount to its market price as well.

We recommend subscribe to the issue with long term investment horizon.

Sunday, November 28, 2010

Shipping Corp sets FPO price band at Rs 135-140/share

Shipping Corp sets FPO price band at Rs 135-140/share

Shipping Corporation of India (SCI), one of India's largest shipping companies in terms of Indian flagged tonnage, has set a price band at Rs 135-140 a share for its follow-on public offer (FPO) of 8,46,90,730 equity shares, which will open for subscription . The issue comprises of a fresh issue of 42,345,365 equity shares by the company and an offer for sale of 42,345,365 equity shares by the President of India, acting through the ministry of shipping, government of India. The issue comprises a net issue to the public of 84,267,276 equity shares and a reservation of up to 423,454 equity shares for subscription by eligible employees.

The lot size being 50 equity shares.

The share closed at Rs 145.40, down Rs 1.3, or 0.89% on the Bombay Stock Exchange while the price band is set at a 3.7% discount to its current market price. The company aims to raise around Rs 1,100 crore through the FPO.SCI has approximately 35% share of Indian flagged tonnage as of June 30, 2010, according to the website of Directorate General of Shipping, Government of India (DG Shipping). As of September 30, 2010, it owned a fleet of 74 vessels of 5.11 million dead weight tonnage (DWT). Its fleet includes dry bulk carriers, very large crude carrier (VLCC) tankers, crude oil tankers, product tankers, container vessels, passenger-cum-cargo vessels, phosphoric acid and chemical carriers, LPG and ammonia carriers, and offshore supply vessels.

The issue will close for subscription on December 3. Central and state governments' holding will reduce to 63.75% post issue.SBI Capital Markets Limited, ICICI Securities Limited and IDFC Capital Limited are the book running lead managers to the issue.

Tuesday, November 23, 2010

IPo : Claris Life Sciences Ltd.

The IPO of an Ahmedabad based pharmaceutical company, Claris Lifesciences will hit the market on Nov 24, 2010. It fixed price band at Rs 278 to 293. It will close on Nov 26, 2010.

IPO of Claris Life Sciences Ltd. provides an opportunity to invest in altogether different business model in pharmaceutical sector. It has well diversified injectable product portfolio, one of the largest in the country. On the profitability front, low competition augurs well for the margins. The company recently entered into a contract with Pfizer Inc with a view to tap the potential in United States and other regulated markets by expanding sales and distribution network. Further the company has certain technical advantages that make it highly competitive among its peers. At the higher side of the price band, the issue is available at a significant discount to traded peers.

We recommend subscribe to the issue with long term investment horizon.

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Monday, November 22, 2010

Manganese Ore India Limited (MOIL)

Manganese Ore India Limited (MOIL) is the next big PSU IPO offering that is going to hit the market after Coal India IPO and Power Grid FPO.

MOIL is offering initial public offer of 33,600,000 equity shares of Rs10 each for sale on November 26. The offer will close on November 30 for qualified institutional buyers and on December 1 for retail and non-institutional bidders.

The Price Band and Lot Size will be announced on November 23 2010.

IPO of Manganese Ore India Ltd (MOIL) provides an opportunity to invest in the India's largest manganese ore company with 'Miniratna' status. The company is committed to maintain its leadership position in the Indian manganese ore market by increasing its production capacity in line with growth in demand. It intends to add reserves and resources by undertaking exploration in and around its existing lease areas. It aims to become a vertically-integrated manganese ore producer by leveraging its midstream and downstream capabilities. In order to improve cost-efficiency through higher recovery rates and reduced production costs associated with labor, the company intends to pursue the mechanization process at its mines by investing further in new technologies. It has a strong balance sheet with zero debt and huge cash. We recommend subscribe to the issue with long term investment horizon.

Sunday, November 21, 2010

Power Grid FPO Basis of Allotment November 2010

Download Power Grid FPO Basis of Allotment November 2010

Saturday, November 20, 2010

Mutual Funds: Schemes witness money exiting and drop in folio numbers

Equity Fund Folios drop 3.5 lakh in Oct

The retail investor exodus from mutual funds continues unabated even in October as most schemes witness money exiting and drop in folio numbers. Equity funds witnessed folio numbers shrink by 3.52 lakh to 3.91 crore in October. Overall, the number of investors' account dropped by 3.62 lakh to 4.68 crore in October compared with 4.71 crore in September.

Even balanced funds witnessed a fall in number of folios by 38,113 to 27.58 lakh during the month. Overall, in October, equity diversified funds (including tax-saving funds) observed a net outflow of Rs 3,063 crore. Units worth Rs 9,227 crore were redeemed during the month, while new sales accounted for Rs 5,164 crore. The redemptions were mainly on account of profit booking by investors.

With the market indicators touching the highs of January 2008, many investors who had been stuck in the market since 2007 preferred to exit to recover the notional losses. Gold and other ETFs had an increase in investors where the account rose by 13,000 while the same increased by 24,000 in schemes of debt category.

Number of investors account
Fund category	Oct-10	Sep-10
Equity	3,90,87,191	39,439,302
Debt	43,87,480	43,63,761
Balanced	27,57,920	27,96,033
ETFs	3,17,101	3,04,133
Fund of fund	2,28,322	2,36,948

Source: Sebi, AMFI

Friday, November 19, 2010

Reliance Communication Q2FY11 Result Update; Disappointment continues, Downgrade to REDUCE; Target: Rs135

Reliance Communication

Reco: REDUCE

CMP: Rs154

Target Price: Rs135

Disappointment continues, Downgrade to REDUCE

· Q2FY11 EBIDTA grew by 1.7% QoQ to Rs16.6bn (below est of Rs17.6bn), PAT of Rs4.45bn led by lower interest expense

· ARPU falls 6.2% QoQ to Rs122 purely on MOU decline as RPM remains stable. Wireless traffic growth absent

· Cut EBIDTA and EPS estimates by 1.8% /3.5% and 14% /16.3% for FY11E /12E respectively

· Cut target price to Rs135 (from Rs180) and rating to REDUCE from HOLD earlier. Valuations expensive at 9.2x and 8.8x EV/EBIDTA for FY11E and FY12E respectively

ONGOING & TENTATIVE IPO LIST

	ONGOING IPO LIST
Issues	Open Date	Close Date	Price Band	Bid Lot	Issue Size in Rs.
RPP INFRA PROJECTS LTD-	18-Nov-10	22-Nov-10	68-75	80	48.75 Cr
MOIL LIMITED	26-Nov-10	1-Dec-10	-	-	-
	TENTATIVE FORTH COMING IPO LIST
ISSUES NAME	Open Date	Close Date	Price Band	Bid Lot	Issue Size in Rs

A2Z MAINTENANCE AND ENGINEERING SERVICES LIMITED.	30-Nov-10	-	-	-	-
SHIPPING CORPORATION OF INDIA LTD	30-Nov-10	-	-	-	-
HINDUSTAN COPPER LTD	8-Dec-10	-	-	-	-
CLARIS LIFE SCIENCES LTD	10-Dec-10	-	-	-	-
RAVI KUMAR DISILLERIES LIMITED	15-Dec-10	-	-	-	-
GREATSHIP INDIA LIMITED	-	-	-	-	-
LAVASA CORPORATION LIMITED	-
PUNJAB & SIND BANK LTD	-	-	-	-	-

Thursday, November 18, 2010

Power Grid FPO Listing date 26th November

Power Grid FPO Allotment Online – Listing date 26th November

Shares of Power Grid FPO can be expected to be credited to demat accounts in NSDL and CDSL by the 24th or 25th November as per market news and refunds through ECS could come in on the 25th November. Those investors who have applied through Applications Supported by Blocked Amount (ASBA) can expect the money to be debited next week.

To check the Allotment Status Click here

Visit For Latest of Infra Bonds:

IFCI Long Term Infrastructure Bonds - Series II - November 2010

MOIL Limited IPO Details

MOIL Limited.
Issue Period: November 26– December 01, 2010
Issue Period (For QIB): November 26– November 30, 2010
Issue Period (For Retail & HNI): November 26– December 01, 2010
Price Band: Advertised @ least 2 working days prior to Issue Opening Date
Lot Size: Advertised @ least 2 working days prior to Issue Opening Date
Retail & Employee Discount: 5% to the offer price adjusted at the time of allotment

Retail Appl Limit: Rs.2,00,000/-

Issue size: 3,36,00,000 Equity Shares of Face Value Rs.10 each through an offer for sale by the President of India, Acting through the Ministry of Steel, Govt. of India.
Employee Reservation: 6,72,000 Equity Shares
Net Issue: 3,29,28,000 Equity Shares
QIB Book: 1,64,64,000 Equity Shares (50% of Net issue size)
Retail Book: 1,15,24,800 Equity Shares (35% of Net issue size)
HNI Book: 49,39,200 Equity Shares (15% of Net issue size)

Tuesday, November 16, 2010

Result Update: Mahindra Satyam; Deccan Chronicle; McNally Bharat; Orient Paper; Tulip Telecom

Mahindra Satyam

Reco: REDUCE

CMP: Rs85

Target Price: Rs70

'Growth+ cost' pangs= Margin pressures

· Mahindra Satyam's result continue to indicate the 'Hard toil' faced by the company as Sep'10 qtr revenues decline by ~2% QoQ, margins falling by ~380 bps QoQ to 5.9%

· Result vindicate our negative stance on the company as it faces stiff challenges from both weaker competitive positioning in erstwhile areas of strength

· Cut our FY11E/12E/13E margins to 8.4%/14%/14.7% (V//s 15.2%/17.1%/17% earlier) driving a 48%/24%/19% in EPS to Rs 2.7/4.9/6(V/s Rs 5.1/6.4/7.5 earlier)

· Maintain REDUCE rating with a revised March'12 DCF based TP of Rs 70(V/s Rs 81 earlier, implying ~12.5x 1 yr forward P/E)

Deccan Chronicle

Reco: BUY

CMP: Rs129

Target Price: Rs175

Results below estimates, Catalyst exist - BUY

· Q2FY11 headline profit declined by 17% yoy to Rs826mn, below our estimate of Rs1.05bn affected by 5.7% yoy decline in revenues

· Shift of festivities to Q3 and high base led to ad-revenue decline of 6% yoy

· Cut EPS estimates by 6.5% and 5.5% to Rs12.1 and Rs15 for FY11E and FY12E respectively

· Target price cut to Rs175. Retain BUY rating on attractive valuations. Buyback upto Rs180/share and IPL franchise stake sale are near term triggers

McNally Bharat Engineering

Reco: BUY

CMP: Rs239

Target Price: Rs418

Management holds guidance, Reiterate BUY

· Q2FY11 performance remains below estimates - revenue growth was healthy at 32% yoy to Rs4 bn, but APAT growth at 10% yoy to Rs97 mn was below expectations

· CMT springs positive surprise on qoq basis – revenues up 46% qoq and PBT up 425% qoq. MSE failed to deliver – revenues down 10% yoy and APAT down 24% yoy

· Despite lower Ebidta margins in H1FY11 - reiterates consolidated revenue guidance for FY11E of Rs25 bn and EBITDA margins at 10%, lending much needed comfort

· Valuations attractive at 8.1X FY12E - Reiterate 'BUY' rating with target price of Rs418/Share

Orient Paper & Industries

Reco: BUY

CMP: Rs65

Target Price: Rs77

Cement division hurts profitability

· Net profit at Rs5mn (-98.8% yoy) below estimates, led by poor performance of cement division. Revenues at Rs4.25bn (+8%), electricals (+26%) & Paper division (+15%)

· Though EBITDA declined by 74%, led by 91% decline in cement EBIT, paper division surprised positively, showing signs of turnaround. Electricals margins saw dip of 658 bps to 5.2%

· Downgrade earnings by 11.9% for FY11 (EPS of Rs6.5) and 6.8% for FY12(EPS of Rs8.8) led by lower cement realizations and margin pressure in electricals segment

· OPIL on the verge of earnings recovery led by recent cement price hikes in its key markets and turnaround of paper division. Upgrading TP to Rs77 by rolling over to FY12 nos

Tulip Telecom

Reco: BUY

CMP: Rs178

Target Price: Rs240

In-line results, Retain BUY

· Q2FY11 EBIDTA grew 28.5% to Rs1.6bn and APAT grew 35.3% yoy to Rs781mn, in line with estimate

· Better than expected revenue growth of 19% to Rs5.9bn along with EBIDTA margin expansion of 200bps yoy drives profit growth

· Net-debt rises to Rs11.6bn v/s Rs9.6bn in Q1FY11 primarily due to Qualcomm investment (Rs1.4bn)

· Retain estimates, BUY rating and target price Rs240. Valuations at FY12E EV/EBIDTA of 4.1x & P/E 6.9x, attractive

Retail Application Increase of Limit from Rs. 1 Lac to Rs.2 Lacs - Guidelines

SEBI amendment raising the limit for retail investors from Rs.1 lac to Rs. 2 lacs.

Visit : Visit Here

Stock Picks from Religare

Stocks for long-term play

The markets have corrected more than 5% from the closing highs of November 05, 2010. A correction was inevitable as the market had run up more than 11% in the month of September and remained flat, amidst high volatility in October. Nevertheless this correction should be used as a buying opportunity as we believe fundamentals of the Indian economy remain intact and that the money from the overseas will continue to chase growth.

Mentioned below are fundamental picks for the long term play.

S No	Company	Recommendation	CMP (Rs)	Target (Rs)
1	Biocon	Buy	406	550
2	Educomp Solutions	Buy	543	700
3	Glenmark Pharma	Buy	343	390
4	ITC	Buy	170	210
5	Hindustan Construction Co.	Hold	58	73
6	Marico	Buy	137	150
7	Amara Raja Batteries	Buy	185	260
8	Lanco Infratech	Buy	63	85
9	Grasim	Buy	2238	2900
10	TCS	Hold	1053	1100