Today's Bse Nse Stock picks

Nifty, Hind Unilever & Wipro
Devangshu Datta / New Delhi December 31, 2010, 0:30 IST

NIFTY
Current: 6,101.85 (Jan futures 6127),
Target: 6,170
The index has moved above resistance at 6,070 creating a pattern of higher intermediate highs. It could rise till between 6,150 and 6,175 today and it should have a target of 6,250 in the next three-five sessions. Keep a stop at 6,075 and go long if you take a long futures positions. An option bullspread of long Jan 6,200c (69) and short Jan 6,300c (35) also looks attractive with a five-session perspective. It has a potential maximum payoff of 66 versus a net cost of 34.

HIND UNILEVER
Current Price: Rs 309,
Target Price: Rs 318
A price breakout is backed by volume expansion. The stock could test its 52-week high of 320 over the next three sessions. Keep a stop at 305 and go long. Increase the position between Rs 311 and Rs 313. Start booking profits above the Rs 317 level.


WIPRO
Current Price: Rs 490,
Target Price: Rs 497
The stock is testing resistance in the Rs 490-500 zone. It’s likely to reach at least Rs 497 intra-day today and it may move further. Keep a stop at Rs 485 and go long. Add to the position between Rs 493 and Rs 495. Start booking profits above Rs 497.          


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Analysts' corner Bse Nse Stock

SI Team / Mumbai December 31, 2010, 0:51 IST

SHIV-VANI OIL
Reco price: Rs 399,
Target price: Rs 444

Shiv-Vani Oil & Gas Exploration Services (SVOG) could witness value unlocking, owing to significant capex demand, driven by estimated minimum work programme (MWP) requirements of $3.5-billion for onshore Nelp blocks along with sizeable coal bed methane (CBM) blocks potential. SVOG is best placed to milk the domestic onshore E&P capex drive in the long term. The stock trades at 4.6 times FY12E EV/Ebitda, which is at significant discount to global onshore services peers despite their weaker profitability matrices. The company is expected to report free cashflow worth Rs 360 crore in 2010-11. Maintain buy.

— Reliance Securities

BLUE STAR
Reco price: Rs 430,
Target price: Rs 513

Blue Star’s demand outlook remains firm from sectors such as hotels, hospitals, educational institutions, etc. The demand of the Information Technology (IT) sector is yet to recover, but the level of enquiries have improved. Large IT companies have resumed spending, reinforcing management’s belief of a broadbased recovery in the near-to-medium term. Management has reiterated focus on non-commercial sectors such as infrastructure, power and industries. It expects contribution to increase from 20 to 40 per cent over the next three to four years. Pressure on operating margins to id to remain until 2011-12 attributed to high raw material costs and low margin orders in current order book. Room air-conditioners market is set to grow at a robust 30 per cent compound annual growth rate over the next three to four years.Company to increase presence in high growth residential market, but will continue to be a small player (about 5 per cent market share). Maintain Accumulate.

 — Emkay Global Financial Services


KPIT CUMMINS INFOSYSTEMS
Reco price: Rs 136,
Target price: Rs 164

KPIT Cummins Infosystems is riding on the recovery of its anchor vertical — manufacturing. Brokerages expect the company to post a revenue compound annual growth rate (CAGR) of 21.7 terms (rupee terms) over 2009-10 to 2012-13, with Ebitda and net profit expected to grow at a CAGR of 14.4 per cent and 20.2 per cent, respectively. Analysts believe KPIT will witness revenue growth once the global automobile sector returns to higher growth, manufacturing vertical increasingly starts spending on discretionary IT services to go-to-market and drive cost efficiencies and the top-client, Cummins, returns to secular robust growth. Initiate Coverage with Buy.

— Angel Broking

 PUNJAB CHEMICALS & CROP PROTECTION
Fair Value: Rs 126,
Current Price: Rs 115

Crisil Equities has assigned fundamental grade of 1/5 to Punjab Chemicals and Crop Protection (Punjab Chemicals), indicating poor fundamentals. Punjab Chemicals, borrowed heavily to fund its overseas acquisitions, which increased its debt-equity ratio from 1.5x in 2004-05 to 5.3x in 2008-09 and further to 13.0x in 2009-10. The latter was also due to a loss of profit resulting from the fire at the company’s Chandigarh plant in 2009-10. While the company’s performance is likely to improve and return to profitability by 2012-13, given the high leverage analysts expect, financial and liquidity position will continue to remain under stress. Crisil Equities expects Punjab Chemicals’ revenues to grow at a three-year compound annual growth rate of 17 per cent to Rs 920 crore in 2011-12, while EPS is expected to improve to Rs 12.7 in 2012-13 from negative Rs 77.9 in 2009-10.

— Crisil Equities       
             

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Investing in the Top Sectors for Dividend Bse Nse Stocks

 

Several industrial sectors are filled with dividend-paying companies, and some sectors provide better bets than others for your dividend stock investment portfolio. The following sectors offer the top options for dividend stock investing; when you’re fishing for good dividend stocks, you can improve your chances of hooking some keepers by dropping your line in these holes:

• Utilities: Electricity, water, and natural gas (suppliers, not producers)
• Energy: Oil, natural gas (producers, not suppliers), and master limited partnerships (MLPs)
• Telecommunications: Carriers and wireless services
• Consumer staples: Food/beverages, prescription drugs, household products, tobacco, and alcohol
• Real estate: Commercial, residential, or office buildings inside real estate investment trusts (REITS)

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Today's Bse Nse Stock picks

 Bse Nse Stock News

Airtel, Axis Bank & Hindalco
Devangshu Datta / New Delhi December 30, 2010, 0:36 IST

AIRTEL
Current Price: Rs 354,
Target Price: Rs 360
The stock has made a “mini breakout” on high volumes. It could have a target in the range of Rs 360 but it could also fall back to test support at Rs 350. Keep a stop at Rs 351 and go long. Increase the position between Rs 356 and Rs 357. Book profits above Rs 360. If it drops to below Rs 350, go short with a stop at Rs 352 and a target of Rs 344.

AXIS BANK
Current Price: Rs 1,312,
Target Price: Rs 1,285
The stock is likely to hit resistance at Rs 1,318-1,320 and fall back to retest support at Rs 1,285. Keep a stop at Rs 1,320 and go short. Increase the position between Rs 1,300 and Rs 1,305. Start booking profits below Rs 1,287. If Rs 1,320 is broken, a bounce till Rs 1,332 is possible.

HINDALCO
Current Price: Rs 241.5,
Target Price: Rs 248
The stock has made a breakout backed by volume expansion and it will probably test resistance at Rs 243. If it crosses Rs 243, it could climb till Rs 248. However, on the downside, it could slide till Rs 239. Keep a stop at Rs 240 and go long. Add to the position between Rs 243 and Rs 244. Start booking profits above Rs 247.          

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Analysts' corner Bse Nse Stock

 Bse Nse Stock News
MindTree, Bajaj Finance, Hindustan Dorr-Oliver & Sagar Cements
SI Team / Mumbai December 30, 2010, 0:37 IST

MINDTREE
Reco Price: Rs 508,
Target Price: Rs 660
MindTree expects the quantum of losses for restructuring the product business will be $3.6–3.9 million against an earlier indication of $12-14 million. These entire losses will be accounted in the December quarter and there will be no further impact. The costs are mainly in the nature of people separation, legal fees, asset write-offs and payments to vendors for cancellation of contracts. The actual amount of losses is 70 per cent lower than the indicated range. Further, there will be no impact on the financials from 4QFY11 onwards and that should address investor concerns. MindTree had announced launch of product business in April with an estimated investment/loss of $10-11 mn between April-September 2011. Subsequently in October 2010, company announced its decision to shut the product business and indicated restructuring cost of $12-14 mn. Maintain BUY.

— JM Financial Research

BAJAJ FINANCE
Reco price: Rs 700,
Target price: Rs 918
Bajaj Finance Limited (BFL) is a play on rising consumer spending in India, which is expected to grow multi-fold on rising disposable income. It has metamorphosed itself from Bajaj Auto’s finance arm to a diversified NBFC, where its loan book from Bajaj Auto is expected to reduce from current levels of 30 per cent to 23 per cent by 2011-12. The company has plans to foray into infrastructure financing. Diversification into other secured assets business will likely enhance quality of loan book. High yield consumer durable financing business and secured loans business is expected to show compound annual growth rate (CAGR) of 42 per cent and 100 per cent respectively, during FY10-FY12. Total disbursal and loan book will exhibit CAGR of 50 per cent during the same period. Balance sheet of BFL is well capitalised and tenure for the majority of borrowings is more than two years, which will help contain cost of funding in case of rising short term rates. Initiate coverage with buy.

— Motilal Oswal

HINDUSTAN DORR-OLIVER
Reco price: Rs 116,
Target price: Rs 138
Hindustan Dorr Oliver (HDOR) has an order-book of Rs 1500 crore and is strategically placed to benefit from the robust industrial production and increasing capex in the core industries in India. HDOR has undertaken various cost controls and quality control initiatives since it became a part of IVRCL, resulting in improving operational efficiency. HDOR has tapped new clients backed by strong brand equity, track record and presence across infrastructure segments of IVRCL. The sound and large balance sheet of the parent also helps HDOR to bid for bigger projects. The Davy Markham acquisition will provide technological expertise and equipment to strengthen its presence in domestic and overseas mining sector. The tie-up with SPIG will provide HDOR the exclusivity to participate and jointly bid for cooling tower projects. Maintain buy.

— Reliance Securities

SAGAR CEMENTS
Fair Value: Rs 202,
Current Price: Rs 138
Sagar Cements (Sagar) has grown from a mini cement plant to a mid-sized cement manufacturer with 2.35 mtpa grinding capacity in Andhra Pradesh, a cement manufacturing hub in India. It has JV with Vicat (France) for setting-up a fully integrated cement plant of 5.5 mtpa (2.75 mtpa to be operational in 2011-12). Sagar is entitled to 47 per cent stake in the JV with 19.7 per cent cash contribution – significant shareholder value accretion at low cost. However, over the next two years, Sagar’s profitability is expected to be impacted by the overcapacity in the southern region, with improvement post 2011-12, when the industry overcapacity is likely to ease. Crisil Equities expects two-year revenues CAGR of 4 per cent to Rs 460 crore in 2011-12, with EPS of Rs1, lower than Rs 13 in 2009-10.

— Crisil Equities

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Six Signs of a Promising Dividend Bse Nse Stock Company

Dividend stock companies often give you signs that their outlooks are promising. Although you shouldn’t bank entirely on a stock’s promise, these signs can help you weed out bad-news dividend stocks that don’t belong in your investment portfolio.

• Rising dividend payments: A long history of rising dividend payments, in good times and bad, generally indicates a stable company. Look for at least a three-year history; five years is better.
• Fiscal strength: You want to see debt ratios showing that the company has sufficient financial resources to cover liabilities, as well as continued dividend payments at or near levels of past payments. Look for the following:
  • Quick Ratio higher than 1 percent.
  • Debt Ratio higher than 2 percent.
  • Debt-to-equity ratio at or below 1 percent.
• Good value: Shares trading below absolute or fair value. Go to Yahoo! Finance and compare the company’s P/E with the P/E for its sector. A below-average P/E may be a bargain. Also compare growth rates and look for companies growing faster than the industry.
• Predictable, sustainable cash flow: Banks, consumer staples, and utilities have a solid reputation for maintaining positive cash flow. Avoid industries and individual companies that have a track record of erratic cash flow streams.
• Confident company insiders: If company insiders are buying rather than selling shares, that means they believe in the stock’s strength.
• Sector survival: Consider companies that seem to be holding their own or even thriving in a sector that’s bruised and battered.

       
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Today's picks

Coal India, ICICI Bank & Tata Motors
Devangshu Datta / New Delhi December 29, 2010, 0:27 IST

COAL INDIA
Current Price: Rs 304,
Target Price: Rs 296
The stock made a breakout when it dropped below support at Rs 309 on higher volumes on Monday and confirmed it yesterday with a further fall on volume expansion. A fall till Rs 295 is possible. Keep a stop at Rs 307 and go short. Add to the position between Rs 299 and Rs 301. Start booking profits at Rs 296

ICICI BANK
Current Price: Rs 1,112,
Target Price: Rs 1,090
The stock is in a gradual downtrend and likely to test support between Rs 1,090 and Rs 1,105 today. If that breaks, Rs 1,075 is a likely target. Keep a stop at Rs 1,125 and go short. Increase the position between Rs 1,100 and Rs 1,106. Start booking profits below Rs 1,091. If you can hold till settlement (December 30), look for a target of Rs 1,075.


TATA MOTORS
Current Price: Rs 1,269,
Target Price: Rs 1,230
The stock is seeing selling on heavy volume and likely to test support at Rs 1,250 on the downside. If Rs 1,250 breaks, it could slide till Rs 1,225-1230. Keep a stop at Rs 1,278 and go short. Increase the position between Rs 1,256 and Rs 1,263. At Rs 1,250, book partial profits and reset the stop till Rs 1,255. If the price drops below Rs 1,250, look for a target of Rs 1,230. 

     

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Analysts' corner

 
Infosys Technologies, eClerx, JK Lakshmi Cement & Kandagiri Spinning Mills
SI Team / Mumbai December 29, 2010, 0:27 IST

INFOSYS TECHNOLOGIES
Reco Price: Rs 3,369,
Target Price: Rs 3,667
Infosys plans to move into next orbit by ramping up its Consulting/PI and transformational offerings. Focus on new engagement models (NEMs) is bearing fruit and is expected to contribute one-third to the topline. CY11 budgets are expected to be flat-to-marginally positive and robust traction from BFSI and retail is expected to drive growth in the near-term. While the company continues to capture demand through aggressive hiring, a strategic acquisition cannot be ruled out. Infosys revenue growth is estimated at 25-30 per cent in 2011-12. While retail is focusing more on driving revenues, manufacturing is focused on cost-efficiency measures. Smart pick-up in telecom sector is expected following the current cycle of capex done by telco clients. Drive towards 40:40:20 revenues from US, Europe and RoW will de-risk the revenue profile materially. Maintain market performer.

— India Infoline

ECLERX
Reco price: Rs 730,
Target Price: Rs 670
eClerx is on track to achieve brokerages’ 2010-11 revenue estimates of $75 million (up 35 per cent y-o-y). Company expects sales and marketing support business to grow faster than the capital market business driven by new client wins in the recent past and pick-up in prospects after a relatively sedate 2009-10 for the digital media segment. In terms of demand from the capital market segment, company does see regulatory resolutions impacting volumes. However, it sees this as a future opportunity in the form of transformational/consulting projects. Brokerages currently model in 8 per cent sequential growth in revenues for Dec’10 quarter at $19.4 million with margins flat margins at 36.2 per cent. Current valuations appear reasonable after a 70 per cent plus upmove in the past six months. Maintain accumulate.

— Emkay Research


JK LAKSHMI CEMENT
Reco price: Rs 55,
Target Price: Rs 81
JK Lakshmi Cement has annual cement capacity of around 4.75 million tonnes. The Northern region accounts for 52 per cent of total sales of the company, while the West accounts for the rest. The extended monsoon adversely affected demand for cement in northern and western regions whereas heavy fog and cold weather is expected to delay cement consumption further. As a result, since April, prices in the North fell by 8-10 per cent. However, analysts believe from next quarter, demand is expected to pick-up in northern and western regions as it is a busy period for construction. Historically, the March quarter has seen higher-than-average cement consumption, boosting cement prices. Prices in the West have risen by 5-7 per cent since October. This increase in prices will lead to better realisations, and, hence, better margins for the company.

— Reliance Securities

KANDAGIRI SPINNING MILLS
Fair Value: Rs 124,
Current Price: Rs 107
Crisil Equities has assigned a fundamental grade of 2/5 to Kandagiri Spinning Mills Ltd. (Kandagiri) indicating ‘moderate’ fundamentals. Kandagiri is well placed to cater to increased demand following the execution of a modernisation plan, which is expected to improve its utilisation rates. Kandagiri is present only in the cotton yarn segment, exposing it to any downturn in the cotton yarn industry. Additionally, the company’s margins are susceptible to volatile cotton prices. Crisil Equities expects Kandagiri’s revenues to grow at a three-year compound annual growth rate of 15 per cent to Rs 170 crore in 2012-13, while EPS is expected to increase from Rs 8.4 in 2009-10 to Rs 22.0 in 2012-13.

— Crisil Equities         

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Researching Your Dividend Bse Nse Stock Picks with Important Formulas

As with all stocks, you should research the dividend stocks you’re considering before you buy them to ensure they’re good investments. These formulas help you determine whether a stock’s dividend and other markers are sufficient to meet your needs. Check out the company’s balance sheet, income statement, and cash flow statements for the figures you need to crunch the numbers using the following formulas.

Dividend Per Share (DPS)

Total Dividends ÷ Total Shares = Dividend Per Share (for the quarter)

$_______________ ÷ _______________ shares = $_______________ DPS

Indicated Dividend Per Share (IDS)

Dividend Per Share (DPS) x 4 = Indicated Dividend Per Share

$_______________ x 4 = $_______________ IDS

Yield

Indicated Dividend Per Share ÷ Share Price = Yield

$_______________ ÷ $_______________ = _______________ % Yield

Earnings Per Share (EPS)

Net Profit ÷ Total Shares Outstanding = Earnings Per Share

$_______________ ÷ _______________ shares = $_______________ EPS

Price-to-Earnings (P/E) Ratio

Share price ÷ Annual Earnings Per Share = P/E

$_______________ ÷ $_______________ = _______________ P/E

Payout ratio

Dividends Per Share ÷ Earnings Per Share = Payout Ratio

$_______________ ÷ $_______________ = _______________% Payout Ratio

Net Margin

Net Profit ÷ Total Revenues = Net Margin

$_______________ ÷ $_______________ = _______________% Net Margin

Return On Equity (ROE)

Net Annual Profit ÷ Average Annual Shareholder Equity = Return On Equity

$_______________ ÷ $_______________ = _______________% ROE

Quick Ratio

(Current Assets - Inventories) ÷ Current Liabilities = Quick Ratio

($______________- $______________ ) ÷ $______________ = ______________ Quick Ratio

Debt Covering Ratio

Operating Income ÷ Current Liabilities = Debt Covering Ratio

$_______________ ÷ $_______________ = _______________ Debt Covering Ratio

Debt-to-Equity Ratio

Total Liabilities ÷ Shareholders’ Equity = Debt-to-Equity Ratio

$_______________ ÷ $_______________ = _______________% Debt-to-Equity Ratio

Free Cash Flow

Net Cash from Operating Activities - Capital Expenditures = Free Cash Flow

$_______________ - $_______________ = $_______________ Free Cash Flow

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Bse Nse Stock Picks By Brokers

Date	Company	Broker	Reco	Price  on  Report  Date	Target Price	CMP	Return (in %)	Return Relative to Sensex (in %)	Target Achieved
28-DEC-10	Allahabad Bk	Emkay	Buy	216.00	300.00	216.00	0.00	0.03	No
28-DEC-10	Kec Intern	Angel	Buy	483.60	648.00	489.15	1.15	1.18	No
28-DEC-10	Ntpc	Angel	Buy	196.75	230.00	197.40	0.33	0.36	No
28-DEC-10	Kpit Cummi Info	Angel	Buy	136.05	164.00	140.25	3.09	3.12	No

Post From Myris Broker Reaserch         


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How to Choose Analyse Growth Bse Nse Stocks

A stock is considered a growth stock when it’s growing faster and higher than stocks of other companies with similar sales and earnings figures. Usually, you compare the growth of a company with growth from other companies in the same industry or compare it with the stock market in general.

If a company has earnings growth of 15 percent per year over three years or more and the industry’s average growth rate over the same time frame is 10 percent, then this stock qualifies as a growth stock. A growth stock is called that not only because the company is growing but also because the company is performing well with some consistency.

Here are some other important things to look at when considering growth stocks:

*Fundamentals. This refers to the company’s financial condition and related data. When investors do fundamental analysis, they look at the company’s fundamentals: its balance sheet, income statement, cash flow, and other operational data, along with external factors, such as the company’s market position, industry, and economic prospects. The company should have consistently solid earnings, low debt, and a commanding position in the marketplace.

*Value. Value stocks are stocks that are priced lower than the value of the company and its assets. You can identify a value stock by analyzing the company’s fundamentals and looking at some key financial ratios, such as the price-to-earnings ratio. If the stock’s price is lower than the company’s fundamentals indicate it should be (in other words, it’s undervalued), then it’s a good buy — a bargain — and the stock is considered a great value.

*Leaders and megatrends. A megatrend is a major development that has huge implications for most (if not all) of society and for a long time to come. A good example of a megatrend is the aging of America. Federal government studies tell us that senior citizens will be the fastest-growing segment of our population during the next 20 years. How does the stock investor take advantage of a megatrend? By identifying a company that’s poised to address the opportunities that such trends reveal. A strong company in a growing industry is a common recipe for success.

*Strong niche. Companies that have established a strong niche are consistently profitable. Look for a company with one or more of the following characteristics:

oA strong brand: Companies that have a positive, familiar identity — such as Coca-Cola and Microsoft — occupy a niche that keeps customers loyal.

oHigh barriers to entry: United Parcel Service and Federal Express have set up tremendous distribution and delivery networks that competitors can’t easily duplicate.

oResearch & development (R&D): Companies such as Pfizer and Merck spend a lot of money researching and developing new pharmaceutical products. This investment becomes a new product with millions of consumers who become loyal purchasers, so the company’s going to grow.

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How to Understand the Types of Dividend Bse Nse Stocks

By Lawrence Carrel

When you start shopping for dividend stocks and evaluating candidates, consider targeting a specific dividend category to narrow the field. After identifying a few prospects that meet your minimum dividend requirements, you can then dig deeper into each company by using valuation, growth, liquidity, and solvency ratios.
Low-yielding stocks

In general, low-yielding stocks are those with a yield less than the average yield of the S&P 500 Index — currently 2 percent or lower. These yields are unlikely to keep pace with inflation.

You can find the yield on the S&P 500 on the Standard & Poor’s Web site. Under the heading Latest Standard & Poor’s 500 Market Attributes, click S&P 500 Earnings and Estimates. An Excel spreadsheet will appear; the yield is in the middle of the spreadsheet.

Don’t ignore low-yielding stocks and low payout ratios as a starting point for your research. A low payout ratio from a company just starting to pay dividends may show that the company is still reinvesting a considerable portion of its profits. Taking share price appreciation into account, a low-yielding stock may eventually outperform a high-yielding stock.

Steer clear of low-yielding stocks accompanied by high payout ratios. If the company is distributing 50 to 75 percent of its profits to investors and the yield is still below two percent, that’s not a good sign.
Medium-yielding stocks

Stocks posting yields between the average yield of the S&P 500 and up to 3 percentage points greater than the index’s yield are medium-yielding stocks, typically keeping pace with inflation and paying out between 30 and 50 percent of their earnings in dividends.

Investors usually buy medium-yielding stocks only if they expect to see share price appreciation as well as income.

The key issue when buying a dividend stock with a low or medium yield is income growth. You want to see a steady stream of dividend increases.
High-yielding stocks

High-yielding stocks are those with yields at least 3 percentage points higher than the average yield of the S&P 500 Index, which typically means higher than the inflation rate and returns from safer investment vehicles, including CDs and Treasury bonds. Companies that fall into the high-yield category are usually mature and have a limited growth potential. You can find them in a variety of industries, including utilities, energy, and real estate investment trusts. If you’re primarily an income investor, high-yielding stocks are the stocks for you.

Look for the sweet spots: high-yielding, undervalued companies where growth, income, and value all meet. Yield can increase as a result of an increase in dividend payment or a decrease in share price or both. A high-yielding stock can mean the shares are selling for less than they’re worth, signaling a potential buying opportunity. When management increases the dividend as the share price drops, they’re sending a message that they believe the share price will rise to a point at which the dividend is at an appropriate level. Buying the stock at this point may help you reap the benefits of both share price appreciation and high yield.

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Myiris news - From the News Room - Weekly technical calls from brokers Nse Bse

Myiris news - From the News Room - Weekly technical calls from brokers

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Analyst's corner

TCS, Ashiana Housing, IDFC & Orient Paper & Industries
SI Team / Mumbai December 23, 2010, 0:07 IST

TCS
Reco Price: Rs 1,167,
Target Price: NA
Unlike CY10, TCS has witnessed significant discretionary spent commitment at the earlier stage of discussion with its key accounts during customer meets in different geographies. TCS is quite confident of its growth going into 2011-12 as its book to bill ratio continues to improve. With December quarter categorised with lower working days (3 per cent lower than September), volume growth is likely to be impacted for the quarter by similar magnitude. Moreover, the current quarter is likely to bear the impact of stronger rupee as well. Analysts expect margins to decline by 100-120 bps in December quarter, with 7-8 per cent effort-based volume growth. Operating margins are likely to sustain for 2011-12 at 27 per cent as pricing and employee pyramid changes will absorb the salary hikes into next year. Further, declining attrition could impact margins positively.
Maintain buy.

— Edelweiss Securities Limited

ASHIANA HOUSING
Fair value: Rs 220,
Current price: Rs 160.9
Crisil Equities has assigned fundamental grade of 3/5 to Ashiana Housing (Ashiana), indicating good fundamentals. Ashiana has strong track record of developing 9 mn sq ft of residential projects and has a healthy project pipeline of 7 mn sq ft. to be developed over the next four-five years. Ashiana does not accumulate huge land banks, which could result in comparatively lower capital requirements. This along with very low leverage provides Ashiana the strength to withstand cyclical risks. Crisil Equities expects Ashiana’s revenues to grow at a two-year Compound Annual Growth Rate (CAGR) of 40 per cent to Rs 220 crore in 2011-12, while EPS is expected to register growth of 30.7 per cent to Rs 34.3 during the same period.

— Crisil Equities



IDFC
Reco Price: Rs 171,
Target Price: Rs 210
Natixis Global Asset Management (NGAM), a Paris and Boston based asset manager, will acquire 25 per cent stake in IDFC AMC for Rs 275-crore, valuing IDFC’s mutual fund business at Rs 1,100 crore. This translates into 5.5 per cent of average assets under management of Rs 20,000 crore (September 30). This partnership will enable IDFC AMC to significantly enhance its international distribution. NGAM will be able to expand its global footprint. The valuation ascribed by NGAM is higher than the valuations for the past few deals—T. Rowe-UTI MF (3.3 per cent of AUMs in November 2009), Nomura-LIC MF (2.6 per cent in July 2008) but is in line with analysts’ expectations.
Maintain hold.

— Edelweiss Securities Limited

ORIENT PAPER & INDUSTRIES
Reco Price: Rs 55,
Target Price: Rs 80
Orient Paper & Industries’ (OPIL) cement division has recently commissioned 1.6 mn tonne cement capacity expansion (March) and would drive volume growth and 50-Mw CPP would add to energy cost savings. Besides, the worst seems to be over for its paper division with resolution of production-related issues and improved paper price outlook in a rising international pulp price environment. Also, the company’s electrical division is posting robust growth with over 15 per cent volume increase in electrical fan segment and a new stream of revenue from the recently launched CFL. With two of its earnings streams (paper and electricals) on a robust growth phase and its cement business relatively better placed(OPIL) than peers, the company is well placed to tide over the currently challenging phase in the cement space.
Initiate coverage with outperform.

— Indiabulls Researc
   Other How To's

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• financial-measures-to-consider-before Investing
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Myiris news - From the News Room - Stock of the week: Sesa Goa

Myiris news - From the News Room - Stock of the week: Sesa Goa

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Today's picks Nse bse Stock

IBREL, Axis Bank & Sun Pharma
Devangshu Datta / New Delhi December 24, 2010, 0:31 IST

IBREL
Current: Rs 128.5,
Target: Rs 119
Indiabulls Real Estate’s stock seems to have made a downside break out though there’s support at Rs 127-128. If it drops below Rs 127, it could slide all the way till Rs 118. Keep a stop at Rs 131 and go short. Increase the position between Rs 124 and Rs 126 and reset the stop to Rs 127. Book profits below Rs 120.

AXIS BANK
Current Price: Rs 1,314,
Target Price: Rs 1,275
Volumes have dropped alarmingly suggesting a breakdown. If the stock falls below Rs 1,305, it could drop till the Rs 1,270-1,280 mark. Keep a stop at Rs 1,325 and go short. Increase the position between Rs 1,295 and Rs 1,305 and reset the stop to Rs 1,310. Below Rs 1,280, book profits.

SUN PHARMA
Current: Rs 453,
Target: Rs 463
The stock bottomed out at Rs 423 and has since risen on high volumes. It has a minimum target near Rs 460 and a good trending session could push it to Rs 465. Keep a stop at Rs 447 and go long. Add to the position between Rs 455 and Rs 458 and reset the stop to Rs 454. Book profits above Rs 462.


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How Much Should You Invest in Stocks and Stock Mutual Funds?

Asset allocation involves spreading your investments across diverse asset classes in an attempt to reduce the overall portfolio risk, while maintaining or increasing expected portfolio return. In other words, everything doesn’t go up and down at the same time. Some investments zig, while some zag, and the net result is smoother investment portfolio performance.
Two significant academic studies performed within the last 20 years overwhelmingly concluded that more than 90 percent of a portfolio’s long-term variation in return was explained by its weighting between stocks, bonds, and cash; in other words, it's more important that you have investments in stocks than which individual stocks you own or when you bought them. Only a small portion of the returns were explained by the investment manager’s individual investment selections. Asset allocation decisions are the fundamental building blocks on which all good portfolios are designed.
Figuring out the appropriate asset allocation for your portfolio depends on your unique circumstances. To get started, check out the following tables, which focus on your time horizon, tolerance for investment risk, and, of course, your personal goals. In order to determine the appropriate asset allocation for your needs, you must take into account all three of these components.
Use the Time Horizon and Equity Exposure table as a guideline that tells you how much of your total investments should be in stocks or stock mutual funds based on when you’ll need this money. Think of time horizon as the date that you need to withdraw those dollars from your investment portfolio to support your standard of living in retirement. For example, if you’re 60 years old right now and plan to retire in five years, your time horizon isn’t five years. Your time horizon begins five years from now and may go for two to four decades — for the rest of your life. So, the first withdrawal you make does have a time horizon of five years. The next annual withdrawal you make has a time horizon of six years, and so on.

Time Horizon and Equity Exposure

Time Horizon*	Maximum Equity Exposure
0–3 years	0%
4–5 years	20%
6 years	30%
7 years	40%
8 years	50%
9 years	60%
10 years	70%
11+ years	80%

* When you need to spend this money.
The Risk Tolerance and Equity Exposure table gives you the lowdown on how much of your total investment portfolio should be invested in stocks or stock mutual funds based on the maximum amount of money you can handle losing — both financially and emotionally.

Risk Tolerance and Equity Exposure

Maximum Tolerable Loss (Annual)	Maximum Equity Exposure
5%	20%
10%	30%
15%	40%
20%	50%
25%	60%
30%	70%
35%	80%
40%	90%
50%	100%

After looking at these tables, you may discover that the maximum equity exposure will be different depending on your time horizon and your maximum tolerable loss in a given year. If you discover a discrepancy between the maximum equity exposures for your time horizon and your maximum tolerable loss in a given year, select the lower of the two equity exposures.

       Other How To's

• ten-important-points-about-stock
• financial-measures-to-consider-before Investing
• Important-numbers-to-review-before Investing 

Investing Glossary

accredited investor

An individual with net worth of more than $1 million (alone or jointly with a spouse) or with income of $200,000 in each of the past two years and with a reasonable expectation of the same level of income in the current year. Certain higher-risk investments are often restricted to accredited investors.

Investing Glossary

alpha

A risk-adjusted measure of performance. Alpha measures the portion of an investment’s return attributable to the security’s inherent values (for example, earnings growth) rather than to overall market movements.

Investing Glossary

arbitrage

A trading technique that takes advantage of price discrepancies when the same security, currency, or commodity is traded on different markets.

Investing Glossary

at the money

A condition that is met when an option’s strike price is the same as the prevailing price for the underlying stock. For example, if stock ABC is trading at $125 and the option’s strike price is also $125, then the option is at the money.

Investing Glossary

balance sheet

A financial statement that shows the value of a company’s assets, liabilities, and owner’s equity on a given date. Total assets minus total liabilities equals owner’s equity.

Investing Glossary

being short

A situation that occurs when you have sold something you do not own. In commodities, if you enter into a contract to sell a commodity which you don’t own with a promise to deliver it at a set price on a future date, then you are short that commodity. In stocks, you are short a stock if you have sold it and borrowed the shares from a broker to deliver to the purchaser, with an obligation to replace the borrowed shares at a future date. Being short means that you’re bearish, or negative on the market, and that your goal is to make money when the security or commodity that you choose to short falls in price.

Investing Glossary

beta

A measure of a stock’s relative volatility. A stock with a higher beta can be expected to rise or fall more than the overall market, whereas a stock with a lower beta is less volatile than the overall market.

Investing Glossary

Black-Scholes model

A theoretical model used to calculate the fair market value of an option based on time to expiration, price of the underlying stock, historical volatility, strike price, and carrying costs.

Investing Glossary

call option

A contract that gives the holder the right to buy a particular asset at a specified price at any time prior to the expiration of the option.

Investing Glossary

callable bond

A bond that the issuer can redeem before its maturity date. The bondholder is often paid a premium when the bond is called.

Investing Glossary

candlestick

A chart that shows the daily high, low, opening, and closing prices for a security over a specified time period.

Investing Glossary

capital gain

The profit from the sale of an investment at a price that’s higher than the purchase price.

Investing Glossary

certificate of deposit; CD

An interest-bearing investment issued by a bank. CDs are typically available with maturities ranging from three months to five years.

Investing Glossary

churning

Buying and selling securities by a broker for the sole purpose of generating commissions.

Investing Glossary

covered call

A call option written by an investor who already owns the underlying shares. If you write a covered call and the option is exercised by the holder, then you would just deliver the stock to the holder.

Investing Glossary

delta; hedge ratio

Delta represents the price change of an option for every one-point change in the price of the underlying security or futures contract.

Investing Glossary

derivative

A financial instrument whose value is based on the value of another asset or index. A stock option, for example, is a type of derivative that gives you the right, but not the obligation, to buy shares of the stock at a predetermined price. The option’s value changes in relation to the price of the stock.

Investing Glossary

Designated Order Turnaround system; SuperDOT

An electronic order-routing system used by NYSE member firms to send market and limit orders directly to the specialist at the exchange who trades that particular security.

Investing Glossary

dividend

Money paid out by a company to the owner of its stock. An income stock is a stock that has a regularly paid, higher-than-average dividend.

Investing Glossary

equity market; stock market

A market in which stock shares are issued and traded. Trading takes place through both exchanges and over-the-counter markets.

Investing Glossary

exchange-traded fund; ETF

A mutual fund that is traded, like stocks, on an exchange.

Investing Glossary

fiat money

Currency that a government declares to be legal tender, even though it is not backed by reserves of physical assets (such as gold). The value of fiat money derives solely from the public’s confidence and faith in its ability to serve as a storage medium for purchasing power. Most of the world’s money is fiat money.

Investing Glossary

Financial Industry Regulatory Authority; FINRA

The largest non-governmental regulatory organization responsible for overseeing all securities firms that do business in the United States. Responsibilities include professional training, testing and licensing of registered representatives, and arbitration and mediation.

Investing Glossary

foreign currency trading; forex

Speculation on the value of one currency versus another, in which you buy one country’s currency—just as you’d buy a stock or other security—in the hope that it will appreciate relative to the value of another currency.

Investing Glossary

futures

Contracts where you agree to buy or sell a specific amount of a commodity, currency, or other asset at a specified price on a specified future date. Unlike an option, a futures contract creates an obligation, rather than just a right, to buy and sell the underlying security.

Investing Glossary

going long

When you own a security or other asset, you are said to be long that security. When you go long (that is, buy) a security, you’re bullish, or positive on the market, and you expect the price of that security to go up.

Investing Glossary

Government-Sponsored Enterprise; GSE

Privately held corporations created by Congress to work for the common good—generally to facilitate borrowing for homeowners, farmers, and other specific groups. Examples of GSEs include Fannie Mae, Freddie Mac, and the Federal Farm Credit Bank.

Investing Glossary

head-and-shoulders pattern

A chart formation in a graph of an asset price that resembles three mountaintops in a row, with the middle mountaintop being taller than the other two. The pattern indicates a trend reversal, meaning that prices are expected to fall.

Investing Glossary

hedge

An investment strategy that allows you to reduce the risk of an unfavorable price change in a security or commodity. For example, a stockholder of ABC Company who is worried about declining stock prices can offset that risk by buying a put option on ABC, allowing him to sell his shares in the future at today’s price.

Investing Glossary

illiquid securities

Investments that don’t trade very actively and are difficult to sell on short notice.

Investing Glossary

implied volatility

A theoretical value representing the volatility of the security underlying an option. Implied volatility is used by the Black-Scholes model, among others, to calculate the price of an option. Implied volatility usually rises when the markets are in downtrends, and falls when the markets are in uptrends.

Investing Glossary

in the money

A condition that is met when a call option’s strike price is below the prevailing price for the underlying stock. For example, if stock ABC is trading at $125 and the option’s strike price is $120, then the option is in the money. For a put option, the strike price must be above the current market price of the stock for the option to be in the money.

Investing Glossary

index fund

A mutual fund designed to mirror the performance of a specific market index such as the Dow Jones Industrial Average or the S&P 500. Expenses of index funds tend to be lower than other mutual funds because the manager is not actively researching, buying, and selling securities.

Investing Glossary

Individual Retirement Account; IRA

A type of individual retirement savings plan. There are several types of IRAs, including, among others, Traditional IRAs and Roth IRAs. Traditional IRAs are tax-deferred accounts that currently allow individuals to contribute up to $5,000 per year. Contributions to a Traditional IRA may be tax deductible, depending upon several factors. You don’t pay taxes on the income and gains you generate in a Traditional IRA until you make withdrawals; all withdrawals will be taxed at the ordinary income tax rate. Roth IRAs are subject to different tax treatment.

Investing Glossary

leverage

The degree to which an investor or business is utilizing borrowed money. For investors, leverage is a means of multiplying the return on an investment by borrowing money to purchase additional securities or other assets. Buying securities on margin is an example. If you have $1,000 of cash and borrow another $1,000 from your brokerage, you could then purchase $2,000 of stock. If the value of the purchased stock increases by 10 percent ($200), then you have realized a 20 percent gain ($200/$1,000) on your actual cash investment.

Investing Glossary

market capitalization; market cap; cap

The value of a company as measured by the total number of stock shares outstanding times the market price of each share. For example, if company ABC has 20 million shares outstanding, and each share is currently worth $100, then the market cap for ABC is $2 billion. In general, stocks are classified as large cap (over $5 billion), small cap (under $1 billion), or mid cap (anything in between).

Investing Glossary

market-value weighted index

A stock index where the effect of each stock on the index is in proportion to its market value.

Investing Glossary

megatrend

A major ongoing development that is expected to have significant implications for most (if not all) facets of society over an extended period of time. The aging of the American population is an example.

Investing Glossary

momentum

The perceived strength behind a price or volume movement in a security based on the rate of acceleration of that movement.

Investing Glossary

moving average

In technical analysis, a chart line that shows the average of a security’s price over a specified period of time, recalculated for each new data point. For example, a 30-day moving average will include yesterday’s price and those for the previous 29 days. Tomorrow’s moving average will include today’s price but will drop the price for the earliest date in yesterday’s average. The moving average is used to spot pricing trends by flattening out large fluctuations.

Investing Glossary

municipal bond; muni

A bond issued by a local or state government or agency. Munis generally raise money for public projects such as hospitals, roads, bridges, and sewer systems as well as general governmental operations. When you buy a muni, the interest is usually exempt from federal income tax.

Investing Glossary

mutual fund

A fund operated by an investment company that raises money from shareholders and invests that money in a group of assets in accordance with one or more stated objectives, such as income, growth, aggressive growth, and so on. A mutual fund may generally invest in stocks, bonds, options, futures, currencies, and money market securities in accordance with its stated parameters. All shareholders share equally in the income, gains, and losses generated by the fund.

Investing Glossary

naked call

A call option written by an investor who does not already own the underlying shares. If you write a naked call and the option is exercised by the holder, then you would have to buy the stock at the market price to meet your obligation. Naked calls are very risky, though potentially very rewarding.

Investing Glossary

National Association of Securities Dealers Automated Quotation system; Nasdaq

An electronic stock exchange established by the National Association of Securities Dealers (NASD). The Nasdaq lists over 3,200 companies and is the largest equity securities trading market in the U.S.

Investing Glossary

open outcry system

A system where traders on a trading floor or in a trading pit shout and use hand signals to make transactions or trades with each other.

Investing Glossary

option

A derivative security that gives the holder a contractual right to buy or sell a set amount of a stock, commodity, or other asset at a specified price on or before the option’s expiration date. An option is purchased for a fee, called a premium.

Investing Glossary

option buyer; holder

A person who is buying options. Call option holders have the right to buy a stipulated quantity of the underlying asset specified in the contract at a specified strike price. Put option holders have the right to sell the specified amount at the strike price.

Investing Glossary

out of the money

A condition that is met when a call option’s strike price is above the prevailing price for the underlying stock. For example, if stock ABC is trading at $120 and the option’s strike price is $125, then the option is out of the money. For a put option, if the strike price is below the current market price of the stock, then the option is out of the money.

Investing Glossary

over-the-counter market (OTC)

A securities market where trades are conducted by phone or computer network directly between dealers rather than on a physical trading floor. All bonds trade over-the-counter, as do unlisted stocks (generally, stocks of smaller companies that do not qualify for listing on an exchange).

Investing Glossary

premium

When you buy an option, the premium is the amount that you pay to the seller of the option.

Investing Glossary

put option

A contract that gives the holder the right to sell a particular asset at a specified price at any time prior to the expiration of the option.

Investing Glossary

real estate investment trust; REIT

A company, usually traded publicly, that raises money from shareholders and invests that money in a portfolio of real estate properties. REITs are modeled after mutual funds, although the tax treatment of REIT income is different.

Investing Glossary

regression analysis

A statistical technique used to find the mathematical relationship between a dependent variable (such as a company’s stock price) and one or more independent variables (such as GDP, income growth, or inflation). Regression analysis is used to predict future values of the dependent variable based on changes in the independent variables.

Investing Glossary

retracement

A price movement in the opposite direction of the previous trend. When a price has gone too far and traders deem the security overbought or oversold, the price may stop rising or falling and move in the opposite direction for a period of time.

Investing Glossary

Roth IRA

A type of IRA in which contributions to the account are not tax-deductible, but qualified withdrawals are completely exempt from federal income tax.

Investing Glossary

Securities and Exchange Commission; SEC

A federal agency whose mission is to protect investors from fraud or other unlawful market activities.

Investing Glossary

Securities Investor Protection Corporation; SIPC

A nonprofit corporation created by Congress in 1970 to protect investors in the United States. SIPC insures the assets in investor accounts (up to certain maximum amounts) at registered brokerage firms in the event of bankruptcy of those firms.

Investing Glossary

sell stop order

An instruction to a broker to sell a stock at the market price after the security has touched the specified stop price. A sell stop is always placed below the present market price and is usually designed to protect a profit or limit a loss.

Investing Glossary

sentiment

The general feeling among investors as to which direction the stock market is heading. If the sentiment is that prices are going up, it is said to be bullish; if the sentiment is toward a downward movement, it is bearish. Investors base sentiment on market activity and movements in the prices of securities.

Investing Glossary

short; short position

A situation that occurs when you have sold something you do not own. In commodities, if you enter into a contract to sell a commodity which you don’t own with a promise to deliver it at a set price on a future date, then you are short that commodity. In stocks, you are short a stock if you have sold it and borrowed the shares from a broker to deliver to the purchaser, with an obligation to replace the borrowed shares at a future date. Being short means that you’re bearish, or negative on the market, and that your goal is to make money when the price of the security or commodity that you choose to short falls in price.

Investing Glossary

Simplified Employee Pension; SEP

A retirement plan available to small employers and self-employed individuals in which both the employer and employee can contribute to an IRA.

Investing Glossary

Single Premium Immediate Annuity; SPIA

An annuity contract that you purchase from an insurance company with a single upfront payment. An SPIA usually starts making regular monthly payments to you immediately.

Investing Glossary

straddle

You create a straddle when you simultaneously buy a put and a call on the same stock at the same strike price and with the same expiration date.

Investing Glossary

strangle

You build a strangle when you buy a put and a call on the same stock with the same expiration date but at strike prices that are equally out of the money. A strangle costs less than a straddle because both options are out of the money, but you only make a profit if the price of the underlying stock moves dramatically.

Investing Glossary

strike price

The price at which the stock or commodity underlying an option can be purchased (call option) or sold (put option) pursuant to the terms of the contract.

Investing Glossary

swap

An exchange of streams of payments over time according to specified terms. The most common type is an interest rate swap, in which one party agrees to pay a fixed interest rate on a notional principal amount in return for receiving an adjustable rate from another party.

Investing Glossary

teenie

One-sixteenth of a point.

Investing Glossary

tick

A price change in a security’s trades. If the next trade takes a security up in price, it’s an uptick; if it takes the security down, it’s a downtick. In futures and options trading, a tick is the minimum change in price, up or down.

Investing Glossary

trading range

The spread between the high and low prices of a security or commodity within a particular period.

Investing Glossary

Treasuries

Debt obligations of the U.S. government that are secured by its full faith and credit. Treasuries include bills (maturities of less than one year), notes (maturities of 1 to 10 years), and bonds (maturities of more than 10 years).

Investing Glossary

volatility

A statistical measure of the movement of a financial asset's price over time, gauging how fast the price of the asset changes. The price of a highly volatile security can change dramatically over a short period of time. A measure of the volatility of a security relative to the overall market is its beta.

Investing Glossary

writer

A person who is selling options. Call option writers have the obligation to sell a stipulated quantity of the underlying asset specified in the contract at the specified strike price if the option is exercised by the holder. Put option writers have the obligation to buy the specified amount at the strike price if the option is exercised.

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