Today is Akshaya Tritiya

Akshaya Tritiya, also known as Akha Teej is a Hindu and Jain holy day, that falls on the third Tithi (Lunar day) of Bright Half (Shukla Paksha) of the pan-Indian month of Vaishakha. It is an auspicious day of the birthday of Lord Parasurama who is the sixth incarnation of Lord Vishnu. On this day Veda Vyasand Lord Ganesha began to write Mahabharata. The meaning of the word Akshaya is infinite that which never recede.

Today is Akshaya Tritiya i.e. on April 24, 2012.  Akshaya Tritiya is recently associated with buying of Gold. But few of us understand the significance of this auspicious day.

 Celestial Blessing:
Akshaya Tritiya has a very rare celestial combination, because of which a “sacred energy field of a higher dimension and power” gets created.  Akshaya Tritiya falls on the third day of the bright half of Vaishakhi month (April-May), when the Sun and Moon are simultaneously at their peak of brightness, which happens only once every year.

This rare celestial combination has a great impact on all of us. We are at the peak of our potential. Our vibrations are higher than ever before. We get thoughts which are full of potential which we need to be aware of. This is like the whole Universe blessing us with Divine Downloads, which if implemented in action will lead us to great success. Stars, Planets and Celestial objects form a rare combination on their own, and we need to use it to get the best out of us.

Influence of Sun and the Moon Energies:

The Sun represents the Male energy and the Moon represents the female energy. Let us see just one example of the many of both energies impact on us. When you are in “Thinking Mood” there is influence of Moon energy and when you take any “Action” you are being influenced by the Sun energy.  It is great to have a combination of both energies for Growth and Success.

Never Diminishing or Ever Growing Power:

Akshaya Tritiya is a day which generates Never Diminishing Power. Whatever you think keeps Expanding. It is called as a Seed Principle. A single seed has the potential of the infinity. The seed has a program which is invisible, the whole existence acts on this small seed and pulls out the hidden potential.

Like the seed, we all have thoughts. On Auspicious occasions the whole Universe acts on these Thoughts which are invisible, and brings out the materialization which creates a new reality.

One of the examples is the famous “Akshaya Patram”, as mentioned in the Puranas, a vessel that keeps producing in Food as demanded in an unlimited way. On Akshaya Tritiya the whole existence is the “Akshaya Patram”, manifesting abundance and the Unlimited.

Stories from the Past:
There are mainly four significant legends associated with Akshaya Tritiya. They are as follows-
1. This day is observed as the birthday of Lord Parashurama, the sixth incarnation of Vishnu.
2. According to another legend, during the time of the Mahabharata when the Pandavas were in exile, Lord Krishna, on this day, presented them an ‘Akshaya Patra’ a vessel which would produce an unlimited supply of food on demand.
3. This day marks the beginning of “Satayug - the Golden age” as mentioned in the Vedas.
4. The last is the popular legend of Krishna and his childhood friend Sudama who visits him to ask him for financial help. As the story goes, Sudama offers Krishna a handful of beaten rice “Poha”. When Sudama reaches home he is astonished that his poor hut has been transformed into a Palace. Without asking, Krishna showers his family with unlimited riches.

Birth of Great Souls:

People born under this auspicious period are destined to be great souls. They would be spiritually blessed and attain great fame. They would shine very powerfully and create great impact for the world. Some great souls born are:  Adi Shankara, Ramaujacharya, and Lord Buddha.

How to get the best out of this Akshaya Tritiya:
Start a new venture-
Akshaya means never ending or that which never diminishes. The whole day is auspicious and you can choose to start any good venture or project. The amazing wave of consciousness and the celestial alignments will bless you with Success. Think in a 360 degree perspective about your project or any venture which you wish to start but surely take the First Action (it may be small and symbolic also) on  this auspicious day April 24 for success. Start any good venture or any project that you might have in mind on this day. The Whole Existence blesses it well.

Meditate and expand your consciousness-
Meditate and exhibit a quality of yours which you want to multiply and expand. Spend some 20 minutes during the whole of April 24 on the key strengths that you may possess. Think of success stories which you have had. Be in a high vibration state and enable all of this to expand effortlessly.

Shop for things for your home or office-
You may choose to buy any Material Objects that you want to last long. It is an auspicious day to purchase some things that you desire. Whenever things are bought in a happy state they last long, give joy and become productive. So choose this day to do Happy Shopping.
Purchase Gold, Silver or Precious Ornaments-

The purchasing of Gold is associated with this festival. Gold, Silver or any other ornaments represent the ultimate in wealth and prosperity. Gold is also a great investment these days especially because of turbulent financial conditions all over the world.  From times immemorial Gold has been considered as a very auspicious metal. The best is to buy Gold Coins available with certification through any bank or reputed jeweler. If you have never invested into Gold, Akshaya Tritiya is the best day to begin. Make it a wise investment habit to purchase Gold each month in whatever quantity you may decide.  Gold and Silver bought and worn on this day signify never diminishing good fortune in your life.

Become Wealth Conscious-
This is a time when you nurture and cultivate the concept of non-declining or non-decreasing wealth. You could instil in your mind, body and soul the consciousness of money and wealth creation.
Stop Postponing and Take Action Now-
Many of us unfortunately keep postponing good decisions that will take us ahead in life. Take small or massive action in areas pertaining to Money and Wealth Creation. A good beginning is more than half the work completed and creates a good end.

Remember all your positive Actions will be rewarded!

Welcome Goddess Mahalakshmi and Kubera home!!

Kubera the custodian of wealth was blessed with Mahalakshmi, the goddess of wealth. Hence Kubera has an inexhaustible supply, his money never decreases. This is a day of celebration for both Godess Mahalakshmi as well as lord Kubera. Welcome them to your home.

Wishing you and your family a very Eventful Akshaya Tritiya

More bright stars than dark spots

Earnings and financial condition of only a few companies influencing sentiment.

Keki Mistry, vice-chairman and chief executive of Housing Development Finance Corporation (HDFC), isn’t perturbed by the gloom and doom theory doing the rounds. There is a strong enough reason for that: India’s largest mortgage lender, which announced its latest earnings on Thursday, saw its loan portfolio grow 21 per cent year-on-year in the first nine months of the financial year. The firm's asset quality also improved for the 28th consecutive quarter in October-December.

 “Everyone has been worried about the slowdown and high interest rates and their impact on our growth. We have not seen any significant impact so far. Perhaps the property market in Mumbai has slowed down, maybe it has slowed down marginally in one or two other places, but overall there is no impact on our growth,” Mistry says.

Corporate India’s numbers show why Mistry is bang-on. It’s only a handful of companies that are influencing the aggregate figures. Consider this: while the aggregate growth in adjusted profit after tax (PAT) of the top 200 companies by sales is just 4.6 per cent, it is strongly influenced by the performance of the three public sector oil marketing companies, which reported a loss of Rs 15,436 crore for the 12 months ended September 2011 as against a Rs 10,660 crore profit in the corresponding year-ago period. Excluding these three companies, the growth in adjusted PAT of the remaining 197 companies is 14.1 per cent.

In the oil and gas space, oil producing and refining companies did quite well.

The story is the same in most sectors. Take automobiles. Just two of the top seven companies have shown a decline in profits in the same period. The aggregate net profit of these companies grew 14.6 per cent. But if one excluded Maruti and Ashok Leyland, the growth would have been 20.8 per cent.

On an aggregate level, only nine of the 200 companies showed a fall of over Rs 1,000 crore each in their adjusted net profits, while 18 showed an increase of over Rs 1,000 crore each. Interestingly, the latter companies represent a larger range of sectors including oil and gas, auto, natural resources, capital goods, power, banking, FMCG and pharmaceuticals.

Industry leaders and bankers thus feel the fear of economic crises eating into India Inc’s earnings growth and the cascading impact on banks’ asset quality has been blown out of proportion. It is more of a crisis of confidence that has led to stock market underperformance, currency depreciation, and declining investment appetite, they say.

“There is a very deep mood of negativity right now. My feeling is only 20-25 per cent investments, that were ought to happen, probably were throttled. The impact on the feel-good sentiment is, however, disproportionate, probably 50-60 per cent,” K V Kamath, chairman of ICICI Bank and Infosys, says.

Market pundits echo a similar view. Deven Choksey, chairman and managing director, K R Choksey Securities, says, “There is a slowdown in growth rates; actual numbers have not come down. It’s certainly not a case of a complete slowdown. It’s a case of slower intake of orders.”

He points to various issues haunting India Inc, including the Land Acquisition Bill, and delays in infra and industry projects, which is why there is a slowdown in sectors like power, mining, construction and industrial projects.

Gaurav Dua, Head Research, Sharekhan, says the market is down for not one reason, but several. Global uncertainty, a tough macroeconomic environment, a lack of policy action (a key reason), and weak financial health of the government are some. Along with these, earnings growth is slowing down, led by monetary tightening and slowing consumer demand.

The worry is many investment-driven and interest rate-sensitive companies are feeling the heat. Choksey says a sector that has clearly seen a slowdown is infrastructure (mainly construction, power and roads). In capital goods, for example, L&T, Bhel and Crompton Greaves are facing pressures on either growth, profitability or order inflow fronts.

Some examples of individual companies faced with high debt and seeking debt restructuring from banks are KS Oil, GTL Infrastructure and GTL.

Beyond the slowdown in growth rates in select pockets, some companies are witnessing huge pressures. Aviation companies are a clear example. The worst is, of course, Kingfisher Airlines.

While the pessimism about a general slowdown appears exaggerated, bankers and industry analysts say certain sectors like aviation, power, real estate, telecom and textiles need to be monitored closely to prevent the crisis of slow economic growth from intensifying.

For power generation companies, the problem is with procurement of coal and other raw materials. A number of state electricity distribution companies in Haryana, Punjab, Tamil Nadu, and Rajasthan are in various stages of discussion with banks to recast their loans.

However, most banks and industry analysts refuse to consider that these sector-specific concerns may affect domestic economic growth and business activity in the long run.

“We are optimistic in the medium term, over the next 18-24 months. We have seen many cycles like this in the past. The positive side is that rural consumption is still good and keeping the economy up. We think calendar year 2013 will be a better year,” says Neeraj Swaroop, regional chief executive of Standard Chartered Bank in India and South-East Asia

EDELSTAR • FUNDAMENTAL RESEARCH - CESC Ltd

CESC Ltd

Current Price: Rs. 300 Target Price: Rs. 415 BUY

BUSINESS OVERVIEW

CESC Ltd (CESLTD) is an RPG Group company. It was commissioned in 1899 and since then the company has been offering power to consumers in its Kolkata license area which has expanded from 5.64 sq miles to 567 sq km over the years. The number of consumers has grown from 6,000 to 2.1 mn over time. CESC has total installed capacity of 1,225 MW from four generating units at Budge Budge (750 MW), Southern (135 MW), Titagarh (240 MW) and New Cossipore (100 MW).

INVESTMENT THEME

• India’s per capita consumption of electricity, at ~600 KWh, is much lower than other large economies. With strong growth projected for the economy, the per capita consumption is likely to increase significantly, keeping demand strong over the long term.

• India is projected to have power generation capacity of ~750 GW by 2030, ~5x the current capacity, which is expected to be the third highest globally. The macro story of the power sector implies high growth, long-term visibility and sustainable returns. This, together with the demand-supply gap (~16% peak deficit), has been positive and attracting investments into the power sector.

• CESC has a huge expansion plan and intends to increase its capacity to more than 1,825 MW in its license area. The company has been allotted 110 MT of coal block using which it plans setup a power plant. CESC is also seeking growth opportunities in other parts of India in the power space by developing 600 MW power plant in Maharashtra and is also looking at opportunities to develop ~3,000 MW in Bihar, Jharkhand and Orissa.

• The recent discussion paper on FDI in retail is a step in the right direction if it is implemented. With the CESC management keen on selling stake in Spencer’s Retail, GoI’s move, along with improvement in its operational and financial performance, augurs well for the retail business. Spencers Retail’s (Spencers) financial performance has been steadily increasing, reporting a positive store EBITDA/sq ft in June. Revenues/sq ft has improved ~50% Y-o-Y to Rs. 1,100. Current losses have a run rate of Rs. 130 mn/month compared to ~ Rs. 180 mn/month in Q2FY10.

• Looking at envisaged high growth of the power sector, government’s thrust on developing infrastructure, long-term visibility and sustainable returns make the sector an attractive investment option. We are positive on the long term outlook of the stock.

INVESTMENT RISKS

• Our earnings estimates assume incentives on account of PLF and other normative parameters under regulatory norm; if the company fails to earn the same, then RoE would be lower and, hence, impact valuations.

• Escalation in project costs, delay in commissioning of generation projects, and long gestation periods could impact profitability, if delays are not compensated through tariffs.

• We have factored Rs. 3 bn of cash outflow in Spencer’s over FY11 and FY12. However, equity infusion at a greater than anticipated level, due to higher losses, or due to delay in divestment, pose risk to our estimates.

OUTLOOK AND VALUATIONS

We expect consistent performance in CESC’s power business with increasing visibility on pipeline power projects leading to sustainable RoE of ~16%. Despite higher capex in the retail venture, CESC’s net cash at ~Rs. 12 bn (excluding regulated debt) is sufficient to fund the power project pipeline. With likely PE investment in the retail subsidiary, we expect surplus cash to be retained for expanding the power project portfolio, which could lead to further upsides and rerating. CESC is trading at attractive valuations based on FY11E and FY12E standalone earnings. On our FY11E and FY12E EPS estimate of Rs. 38.9 and Rs. 39.4, the stock is currently trading at a P/E of 9.3x and P/BV of 1.07x on FY11E basis and at a P/E of 9.1x and P/BV of 0.97x on FY12E basis. Given these attractive valuations, we believe the stock offers upside potential in the near term.

EDEL WEEKLY TECHNICAL PICKS • TECHNICAL RESEARCh - 6th December 2010

Technical Pick #1: Kingfisher Airlines Ltd (KINAIR) - BUY CMP: Rs. 71.9



Rationale for call: On the weekly chart stock had formed an “Inside Bar” pattern as well broke the resistance of 21DEMA with good volumes. On the hourly chart stock broke the neckline of Inverse Head and Shoulder pattern further indicating positive momentum in the stock. Oscillator on daily chart depicts bullishness with RSI continuing their upside trend.


Buying is recommended at CMP of Rs. 71.9 with target of Rs.79.60 and stop loss of Rs. 67.5.


Target: Rs. 79.60
Stop Loss: Rs. 67.5


Technical Pick #2: Cipla Ltd (CIPLTD) - BUY CMP: Rs. 370.0


Rationale for call: On the weekly chart stock broke the resistance of 362.80 with good volumes and finally closed above the mentioned resistance. Stock is continuously making Higher Top and Higher Bottom on the daily and weekly charts further indicating strength in the stock. Oscillator still continued their upside move.


Buying is recommended at CMP of Rs. 370 with target of Rs. 400 and stop loss of Rs. 351.30.


Target Price: Rs. 400
Stop loss: Rs. 351



Technical Pick #3: Dr Reddys Laboratories Ltd (DRREDD) - BUY CMP: Rs. 1825.0


Rationale for call: Last few trading session stock was consolidating in the range of 1813-1765. On Friday stock broke the resistance of 1813 with good volumes. Beside this on the weekly and daily chart continuously making “Higher Top and Higher Bottom”, further indicating strength in the stock.


We reiterate a Buy on Dr Reddy at CMP of Rs. 1825 with target of Rs. 1955 and stop loss of Rs. 1735.


Target: Rs. 1955
Stop Loss: Rs. 1735

7 Stock Picks by Outlook India

That picking stocks is a combination of both art and science is not a secret anymore, but picking value in the stockmarket remains as difficult as ever. In fact, since the beginning of 2008, things have become a little more complicated for investors. First, the markets went into a tailspin, cutting value of a normal portfolio by at least half. In 2009, markets doubled, leaving the most cautious investors waiting on the proverbial fence. The common theme, both on the downturn and the up move, was uncertainty and fear, and it still is, though the focus has now shifted from the US to Europe. Greece, for example, was saved from the brink of defaulting on its debt. Similarly, market confidence in countries like Spain, Italy and Portugal has also deteriorated. Although a rescue plan by the European Union, along with the International Monetary Fund (IMF), has been put in place, high debt in the region will continue to haunt the markets for a while.
So, having seen the full 360 degree view of the market in just two years, should you be in or out of the market? Markets are mostly uncertain in the near term, but given the kind of resilience the Indian economy showed during the global financial crisis and with the robust medium to long-term outlook, Indian equities are expected to continue to perform well. However, this confidence does not mean that there will be no volatility in the short term. In fact, Outlook Money has always advised investors to enter stockmarkets with at least a three-year horizon, and the longer the better. Now, based on a combination of art and science, we highlight seven growth stocks for a long-term portfolio.

Past and Future
In the stockmarket, past performance is no guarantee of future results, but it does not take away the relevance of history. It helps you cut away the hype around a stock or sector. Investors following this principle avoided the tech bubble a decade ago, and are in a much better position in the upswing, as stocks backed by strong numbers are reaching new highs. But investors do get carried away by future earnings projections and want to catch the next hot stock. Interestingly, according to a study, analysts making earnings projection two years in advance are wrong over 90 per cent of the time. So the idea here is not to suggest the next multibagger, but to highlight stocks with proven track records which will most likely keep delivering in the medium-to-long term. History is full of examples of what exciting ideas and exotic investing have done to the world of finance, from the seventeenth century Tulip Mania to the latest property bubble. On the other hand, legendary investors like Warren Buffett and Benjamin Graham created wealth by sticking to the basics.
Simple parameters. The first thing that we looked at while selecting stocks was growth. We looked at three-year compounded annual growth rate (CAGR) in both topline and bottomline for all the companies listed on the Bombay Stock Exchange. To avoid small companies, we removed those with market caps under Rs 1,000 crore. Although it’s a good idea to find value in smaller companies as it is easier for them to grow faster because of their lower base, in markets where safety is an issue with investors, it makes more sense to hold relatively big and known names. Also, smaller companies are often not researched well by analysts and it becomes difficult to take a call when something goes wrong.

Valuation. Finding a good company with a decent track record is only half the job. It is equally important to figure what kind of price you are paying for it. Here price is not the absolute price of the stock, but in relation to earnings per share. We removed all the companies trading in excess of 20 times past twelve month’s earnings. Also, to qualify in our list of finalists, the growth in profits had to be significantly higher than the price earnings multiple (PE). The benefit of having such stocks is that as the market discovers the earnings momentum, the PE expands to match the earnings growth. But if there is a broader selloff in the markets, growth-valuation mismatch will restrict the fall.
Margins. Healthy profit margins are important for businesses. They not only indicate the ability of the company to price its products or services, but also shows how well a company is placed through phases in the business cycle. A very low profit margin also means that the business is excessively competitive and can restrict future growth.
Other factors that went into picking companies include return on the capital employed, net worth and historical record of price multiples. We also ensured that returns on investment do not rely too heavily on income from “other sources” that are not part of its core operations, and so on. Even after all these criteria, we were left with a fairly big list. Interestingly, a large number of banks and financial institutions qualified and many of them made the final cut but we left the banks out as we featured five of them in our last issue.
Living Dreams
These seven stocks do not necessarily share any underlying theme, but some of them do have similar stories in a very different kind of way. If people like N.R. Narayana Murthy and Nandan Nilekani left Patni Computer Systems in early eighties to live their dream with Infosys Technologies, following in their footsteps, the stars of Wipro went on to found MindTree in the late nineties. Patni Computer Systems did suffer the loss of, perhaps, it’s most valuable assets and it remains less than one-tenth of size of Infosys in terms of market cap. But with change in management, it looks like it is getting ready to do the catch-up. The net profit for Patni has grown in excess of 38 per cent CAGR in last three years. The company has developed a strong ability to protect profits, as it is constantly increasing the share of fixed price projects. Also, better relations with clients is paying off, as it now earns 90 per cent of its revenue from existing clients. Although Infosys continues to be the darling of the markets, maintaining momentum with its size can be problem.
Over a decade after Infosys became a million-dollar idea, Ashok Soota, Subroto Bagchi and a few of their friends from Wipro came together to form MindTree. The idea was simple—everything in the 21st century will either be software enabled or constrained. The idea was put to work, a few other like-minded professionals joined hands, funding was arranged and today, MindTree is a well-respected midsized information technology (IT) company, though still significantly smaller then Wipro. But with over 30 per cent CAGR growth in past three years, the idea called MindTree holds promise.

 

Financing Dreams
While in the IT business people went on to live their dreams, three other companies which made our list are helping other people fulfil theirs. LIC Housing Finance and Dewan Housing Finance Corporation are financing homes for Indians, while Shriram Transport Finance Company is helping small entrepreneurs buy commercial vehicles, largely pre-owned. Interestingly, despite being in the financing business, none of them suffered any major setback in the recent downturn.
Dewan Housing saw the benefit of being in the affordable housing segment long back. Its focus on the tier-II and tier-III cites helped it grow even in bad times. Asset quality was maintained as loan ticket sizes were small. LIC Housing Finance, promoted by the Life Insurance Company of India, also maintained a robust loan disbursal rate without compromising on asset quality. Non-performing assets have come down significantly, while the net interest margin improved by over 3 per cent in the last quarter. Although the company has interests in the commercial space, its focus is on retail, which has worked well for the company. With the economy improving, both areas look poised to reap benefits. Shriram Transport Finance Company is similar to housing finance companies in more than one way. Apart from maintaining good growth and asset quality, the focus is on small borrowers. The company is primarily engaged in financing pre-owned commercial vehicles. That means smaller loan sizes and better repayment track records. The focus area helped the company to overcome the downturn. While sales went down significantly for new commercial vehicles, the second-hand market did not suffer as these vehicles are used in the shorter routes and largely by traders carrying essential commodities, which was not affected by the slowdown. In order to maintain better quality of lending, the company has devised a formula. Fifty per cent of the salary of field officers is linked to the receivables, which automatically means better lending practices. However, these non-banking financial companies have major disadvantage compare to banks as they do not have access to low cost saving and current account deposits. On the other hand, unlike banks, their advantage is that they do not have to put a quarter of their assets in low-yielding government bonds.

Infrastructure Plays
The last two companies come from the infrastructure sector. Sintex Industries’ legacy dates back to 1931. Power Finance Corporation is a state-owned company established in 1986 to finance the growth of the power sector. Sintex has exposure to building products, custom moldings and textiles. While in plastics the company’s growth comes from automotives and electrical accessories, in textiles it supplies brands like Armani, Diesel, Van Heusen and Arrow. The company has an impressive track record of creating value for its shareholders.
If Sintex is tapping manufacturing for ever-rising needs of the Indian economy, Power Finance Corporation is financing power companies to deal with the power deficit in the country and has now diversified into financing raw material and equipment makers in the segment. The company faces competition from banks, but the asset-liability mismatch in funding long-term power projects by banks is an advantage for PFC. Also, the liabilities for the company is at fixed cost and its assets are at floating cost, which helps maintain margins. Given the kind of power shortage the country is facing currently, there will be much higher level of activity in the near future, and most of the power projects are financed by a combination of debt and equity, with debt being the major portion, PFC will be the preferred choice.
These stocks have been selected on past performance and medium-term future growth prospects. This doesn’t mean they will not be subject to wider market volatility, but their strong credentials will help them deal with short-term ups and downs and deliver reasonably good returns in the medium-to-long term.

Technical Calls

Hi Friends,

As many of you had send me emails to start giving the calls again, we have finally decided to start the blog.

Today i am giving you calls based on technicals.  

1.  Buy   Carol Info between 62 - 65   Target 72 & 76   SL 56.
2.  Buy   Radico Khaitan between 111  -  115  Target  125 - 130  SL 105

HAPPY DIWALI AND A VERY HAPPY NEW YEAR

HOPE THAT ALL OUR READERS HAVE BEEN BENEFITED FROM OUR CALLS & WE HAVE EARNED MORE THAN 300% IN THE CALLS GIVEN LAST YEAR.

NOW, WE RECOMMEND OUR READERS TO START BOOKING THEIR PROFITS FROM NOW ON.

HAPPY DIWALI & A VERY VERY HAPPY NEW YEAR