Short term stock tips for 30-June-2008

1. TVSmotor

LTP : 27.40 (27-06-2008)

Buy at : 27 - 27.50

Target : 30.00 (short term)

Stop loss : 25.50

2. ABB

LTP : 864.95 (27-06-2008)

Buy at : 855 - 870

Target : 947 (short term)

Stop loss : 815

Short term stock tips for 26-June-2008

1. Canara Bank


LTP : 177.30 (25-06-2008)


Buy at : 173 - 176


Target : 189 (short term)


Stop loss : 165




2. Lanco Infra (LITL)

LTP : 334 (25-06-2008)


Buy at : 330 - 338


Target : 364 (short term)


Stop loss : 315


Caution : Before buying please aware the following major risks which may drag sensex / nifty suddenly down. Apart from these risks one can hold these fundamental sound stocks for future.

Risk 1. Government may fall at any time if left party removes support to congress govt.

Risk 2. If crude oil prices crosses 140 dollars then it is negative for market.

Risk 3. If Inflation is above 11% then negative for banks,construction and real estate sectors.

Risk 4. Global economical recession / slowdown. or Global stock market weakness.



INTRADAY for 26-JUNE-2008


1. ICICI: Buy at Rs. 699, Target- Rs. 714, Stop loss- Rs. 690


2. ITC : Buy at Rs. 186.50, Target- Rs. 189.55, Stop loss- Rs. 185.00


3. Wipro: Buy at Rs. 454, Target- Rs. 462, Stop loss- Rs. 449.50

Short term stock tips for 25-June-2008

1. Nalco


LTP : 370.35 (24-06-2008)

Buy at : 352 - 355


Target : 385 (short term)


Stop loss : 330

2. HDFC BANK
LTP : 1059.65 (24-06-2008)


Buy at : 1010 - 1025


Target : 1125 (short term)


Stop loss : 970



INTRADAY for 25-JUNE-2008


1. Nagarfert: buy at Rs. 36, Target- Rs. 38, Stop loss- Rs. 35


2. IFCI : Buy at Rs. 43, Target- Rs. 44.75, Stop loss- Rs. 41.50


3. Hindalco: Buy at Rs. 140, Target- Rs. 144, Stop loss- Rs. 137

Short term stock tips for 20-June-2008

1. Wipro


LTP : 490.85 (19-06-2008)


Buy at : 486 - 492


Target : 523 (short term)


Stop loss : 465



2. TTML

LTP : 29.30 (19-06-2008)


Buy at : 28.50 - 29.50


Target : 33.00 (short term)


Stop loss : 27

Nifty intraday support & resistance:

S 2	S 1	Pivot	R 1	R 2
4466.20	4485.20	4513.30	4532.30	4560.40

News to follow

1. Inflation data ( with this banks , real estate and construction stock prices may be affected )

2. Crude oil price ( with this Cairn, RPL, HPCL, BPCL, Construction and Capital goods stock prices may be affected)

3. Left party support withdraw or not ( this unexpected news may drag market by atleast 5 percent down)

Some basic definitions

Going long - means buying.
Going short - means selling (without even having demat account balance). This is, is also called (sometimes) "Short Selling".

Long liquidation means selling off the stocks and reduce the position size.

Short covering means buying back the already sold quantity (with a view to get the balance to zero from a negative).

Retail as well as Institutional Investors can do short selling in the regular BSE/NSE Cash Segment. However, retail investors should buy back the same day (so that the net deliverable quantity is zero by the end of the day). Institutional Investor on the other hand, can resort to stock borrowing & lending to honour the T+2 settlement cycle without squaring off their short positions the same day.

In the futures segment, there is no need to cover shorts the same day (for both retail as well as institutional categories).

Preferred wealth generation mechanism for retail investors is to go long on fundamentally good companies; stick on for considerable amount of time; and liquidate the long once the profit targets are met.

Short term stock tips for 18-June-2008

1. GAMMON INDIA


LTP : 336.75 (17-06-2008)


Buy at : 328 - 332


Target : 355 (short term)


Stop loss : 315



INTRADAY for 18-JUNE-2008



1. Cairn India : Buy at Rs. 274, Target- Rs. 282.50, Stop loss- Rs. 270


2. Crompton Greaves : Sell at Rs. 259, Target- Rs. 253, Stop loss- Rs. 263


3. CESC: Sell at Rs. 422, Target- Rs. 415, Stop loss- Rs. 427


Nifty levels for 18-Jun-2008:

S upport2	Support 1	Pivot	Resistance 1	Resistance 2
4523.95	4588.45	4626.25	4690.75	4728.55

Short term stock tips for 17-June-2008

1. AFTEK


LTP : 40.65 (16-06-2008)

Buy at : 40 - 41


Target : 44 (short term)


Stop loss : 38




2. GVK POWER & Infra


LTP : 39.20 (16-06-2008)


Buy at : 38 - 40


Target : 43.50 (short term)


Stop loss : 36.50



INTRADAY for 17-JUNE-2008



1. Sterlite Industries : Buy at Rs. 800, Target- Rs. 812, Stop loss- Rs. 791


2. Infosys : Sell at Rs. 1915, Target- Rs. 1890, Stop loss- Rs. 1925


3. Nagarfert: Sell at Rs. 48, Target- Rs. 46.55, Stop loss- Rs. 49

Short term stock tips for 16-June-2008

1. Dish TV


LTP : 39.90 (13-06-2008)


Buy at : 40 - 41


Target : 44.50 (short term)


Stop loss : 37.50



2. Astra Micro wave


LTP : 47.60 (13-06-2008)


Buy at : 46 - 49


Target : 54 (short term)


Stop loss : 44



INTRADAY for 16-JUNE-2008



1. Dabur India : Buy at Rs. 101, Target- Rs. 103, Stop loss- Rs. 100


2. Wipro : Buy at Rs. 482, Target- Rs. 487, Stop loss- Rs. 479


3. Nagarfert: Buy at Rs. 47, Target- Rs. 48, Stop loss- Rs. 46.50

INTRADAY stock tips for 12-JUNE-2008

1. ICICI : Sell at Rs. 735, Target- Rs. 720, Stop loss- Rs. 745


2. Hindalco : Sell at Rs. 176, Target- Rs. 171, Stop loss- Rs. 179


3. Cairn: Buy at Rs. 288, Target- Rs. 294, Stop loss- Rs. 283


4. Infosys: Sell at Rs. 1888, Target- Rs. 1855, Stop loss- Rs. 1900

Wednesday, June 11, 2008

Short term stock tips for 11-June-2008

1. JP Associate

LTP : 176.65 (10-06-2008)


Buy at : 172 -177


Target : 194 (short term)


Stop loss : 165



2. Arvind Mill


LTP : 38.50 (10-06-2008)


Buy at : 37 - 39


Target : 43 (short term)


Stop loss : 35



INTRADAY for 11-JUNE-2008



1. SUZLON : Buy at Rs. 270, Target- Rs. 278, Stop loss- Rs. 265


2. IFCI : Buy at Rs. 60, Target- Rs. 62, Stop loss- Rs. 58.50


3. Nagarfert: Buy at Rs. 42.50, Target- Rs. 44, Stop loss- Rs. 41.45

Short term stock tips for 10-June-2008

1. HINDALCO

LTP : 175.60 (09-06-2008)


Buy at : 172 -175


Target : 188 (short term)


Stop loss : 165



2. BHEL


LTP : 1375.25 (09-06-2008)


Buy at : 1340 - 1366


Target : 1470 (short term)


Stop loss : 1290



INTRADAY for 10-JUNE-2008



1. SUZLON : Sell at Rs. 259, Target- Rs. 250, Stop loss- Rs. 265


2. CAIRN : Buy at Rs. 300, Target- Rs. 309, Stop loss- Rs. 294


3. Balrampur Chini: Buy at Rs. 75, Target- Rs. 79, Stop loss- Rs. 73

Short term stock tips for 06-June-2008

1. TATA MOTORS


LTP : 533 (05-06-2008)


Buy at : 520 - 530


Target : 570 (short term)


Stop loss : 500



2. TATA COMMUNICATIONS


LTP : 489.85 (05-06-2008)


Buy at : 490 - 500


Target : 545 (short term)


Stop loss : 469



INTRADAY for 06-JUNE-2008



1. SUZLON : Buy at Rs. 272, Target- Rs. 278, Stop loss- Rs. 267


2. GAIL : Buy at Rs. 400, Target- Rs. 410, Stop loss- Rs. 394


3. ICICI : Buy at Rs. 785, Target- Rs. 797, Stop loss- Rs. 775

Short term stock tips for 05-June-2008

1. BPCL


LTP : 322.30 (04-06-2008)


Buy at : 318 - 325


Target : 360 (short term)


Stop loss : 300



INTRADAY for 05-JUNE-2008


1. Cairn : Sell at Rs. 267, Target- Rs. 256, Stop loss- Rs. 272


2. Fortis Healthcare : Buy at Rs. 73.50, Target- Rs. 76, Stop loss- Rs. 71


3. Nagarfert : Buy at Rs. 42.50, Target- Rs. 43.75, Stop loss- Rs. 41

Investing: Price Vs Value

"Our favourite holding period is forever." - Warren Buffett

This is the wisdom that has flowed from one of the greatest investors of our times. The man is talking, but who is listening? The bigger question to be asked of those few listening is - 'who is applying'? The richest man, second only to Bill Gates, has time and again proved that value buying always pays off in the long term. His mantra has been to invest in 'businesses' not 'stocks'. The rationale - "If a business does well, the stock follows". In this article, we delve a bit deeper into the principle of value buying and discuss the concept of 'circle of competence' as originally defined by Mr. Buffett.

For beginners, 'value investing' is about buying stocks that are selling 'cheap'. In a sense, a value buyer is a bargain hunter. This, however, does not mean that one should buy any stock that is selling cheap. Value buying is about buying stocks of companies that are trading lower to their intrinsic value (this is what we mean by the term - 'cheap'). Thus, it is not the price of the company's stock that determine weather it is a value buy, but the potential value that the company has. As such, value investing is about being able to invest in companies with a conviction of the value being realised or unlocked over a period of time.

Valuing stocks

The most common method used to find the intrinsic value of a company is the discounted cash flow method, where projections are made of a company's cash flows and a discount rate is applied to these to arrive at their present value. If the value arrived at is higher than what the share is presently trading at, it is a value buy else not. Many a times, to make comparative analysis between companies, the 'price to earnings' ratio (P/E) is used. An investor has a target P/E in mind and will buy a stock as long as it is trading below its target P/E. When share prices rise without a corresponding increase in earnings or when a company's earnings are declining without any corresponding changes (or small change) in stock price, it will automatically lead to a rise in the company's P/E, thus signaling the increased risk levels. This automatic mechanism, which is built into the P/E ratio, is what endears it to the investor community.

Information flow

Value investing, although sound simple on paper, is not so simple to apply practically. This is on account of innumerable factors that affect the stock price movements. While on one hand we have news that apply to the broad market as a whole, on the other there are news that are sector or company specific. The markets are efficient enough to factor in the news flow into the stocks prices. As such, being in coherence with the 'right' kind of news is what is the basis for sound (and safe) value investing.

Circle of competence

For a value investor, the most crucial thing is his ability to pick up value stocks. However, this is easier said the done. While the use of different rates to discount cash flows affect the perception on whether a stock is a value buy or not, it is the assumptions with regards to future earnings that are more likely to have a greater impact on valuations. To be able to forecast earnings correctly, one should be able to build the information flowing into the company's expected earnings forecasts.


In this light, it can be said that each individual will be in a position to understand a certain business better than others. This understanding will become his area of competence of which he will, over a period of time, be able to evolve a circle of competence. The concept, as is original defined by Warren Buffett, stands to mean: 'an area where an investor can know significantly more than the average investor (called the circle of competence), and focus his efforts on that area'. By developing this, an investor should successfully be able to weave the information flow into his financial model to arrive at a stock's intrinsic value. As is understood, the circle of competence is a process of evolution and cannot be developed overnight. Rather, it has to be built by gaining insight into the company's area(s) of operations, finance, management and the scope of future events that are likely to affect it.



Thus in conclusion, you, as an investor, need to compare intrinsic value of the company as a whole to its current market capitalisation. Success will, however, depend on your skill of accurately determining the intrinsic value. It can also be said that to be a good value investor, one needs to harness the qualities of a contrarian investor, a patient investor, a rational investor, an analytical investor, and above all, a long-term investor.

Short term stock tips for 04-June-2008

1. Alps industries


LTP : 36.10 (03-06-2008)


Buy at : 37


Target : 41 (short term)


Stop loss : 173



INTRADAY for 04-JUNE-2008


1. Wipro : Buy at Rs. 507, Target- Rs. 514, Stop loss- Rs. 498


2. Satyam : Buy at Rs. 500, Target- Rs. 509, Stop loss- Rs. 492


3. ITC : Buy at Rs. 218, Target- Rs. 222, Stop loss- Rs. 215

Short term stock tips for 03-June-2008

1. Nagarjuna Construction Co.

LTP : 188.65 (02-06-2008)

Buy at : 180 - 185

Target : 198 (short term)

Stop loss : 173

INTRADAY for 03-JUNE-2008

1.CAIRN : BUY @ 267; target: 271; Stoploss: 264
2.RPL : BUY @ 169; target: 174.55; Stoploss: 165
3.HINDALCO : BUY @ 178; target: 181; Stoploss: 175

Short term stock tips for 02-June-2008

1. Cairn India


LTP : 286.45 (30-05-2008)



Buy at : 280 - 286



Target : 309 (short term)



Stop loss : 269

Stock recommendation: Sesa Goa

5/28/2008
India’s largest iron ore exporter, Sesa Goa is on investor’s radar after the announcement of good results, stock split and bonus. All the brokers and analysts are bullish on this stock due to its growth prospects and reasonable valuations despite Government intervention. IT department sent a notice to the Seas Goa management may be a dampener over short term. Stock will give at least 50-60% annual returns. Accumulate aggressively on every fall. Sesa Goa results: Sesa Goa announced wonderful results in Q4. 250% increase in net profit in Q4FY08 and 108% increase in net sales and it outperformed analysts’ expectations.
Chart courtesy: Bloomberg.

Sesa Goa - Stock price analysis:

It is one of the cheapest stocks among outstanding performers. It will at least give 50-60% annual returns even by conservative estimates. 200% rise in EBITDA is exceptional. It is currently available at cheap valuations when you compare it with global mining giants. Stock will definitely catch FII attention within a short time.

CMP: 4,066.
P/E: 10.3
P/EFY09: 7.6 (Estimates)
P/EFY2010: 5.7 (Estimates).

EPS: 391 which is just 164 one year back.
I Year high-low: 4,400-1,400.
Face Value: 10.

Sesa Goa target price:

Short term: It will move between 3,900-4,300 and struggle to break resistance zones. Once it breaks, it may move to 4,800-5,000 by the time of record date. Be cautious about negative triggers.

Short term triggers:

Positive: Stock split and bonus.
Negative: Government intervention and IT notice.

Long term triggers:

1. Demand for Iron ore from China will continue.
2. Cheap valuations when compared to global mining stocks.
3. Increase in coke price will add value.
4. Large expansion plans especially in pig iron.
5. Shipping also has huge prospects.

1 Year target: 5,500-5,700 (Conservative estimates). If market sentiment will change, it will touch even 6,000-6,200.

Verdict: It is a must buy for long term investors. Accumulate it for long term without hesitation. All the natural resources companies will give outstanding returns if you can stay invested for 3-4 years. Sesa Goa may give 20-30% returns over medium term due to stock split and bonus. Record date is yet to be announced.

Best Indian stock pick: Larsen and Toubro

Date:5/29/2008
India’s largest Engineering and Construction giant Larsen and Toubro announced very good results on thursday and company also declared 1:1 bonus issue. L&T which underperformed BSE Sensex and Nifty in the recent days will once again outperform the markets in the coming days. L&T performance in this quarter is more significant when other stocks like SIEMENS, BHEL and ABB announced below par results in this difficult quarter. These results surprised stock analysts as they are expected uninspiring performance from L&T due to losses in derivatives.Significant points:

1. L&T is the best managed company in India – Business Today survey.
2. Rs 600 billion order book by March 2009.
3. Larsen and Toubro will benefit from huge infrastructure investments in India and Gulf regions.
4. Future growth comes from L&T Infotech and shipping along with engineering.
5. Strong order book, good execution skills and good track record and inherent value in subsidiaries make this stock a “Must Buy”.

Larsen and Toubro results analysis: 1. 55% rise in annual profit and 38% rise in Q4 net profit.
2. 41% increase in sales.
3. Operating profit rose by 54%- this is more significant.
4. Rs. 17 dividend.
5. 1:1 bonus issue.

L&T stock price analysis:

CMP: 2882
P/E: 40
EPS: 71
Face value: 2
1 Year high-low: 4,690-1,772. L&T share target price:

It is trading at a forward P/E of 23 for FY2009 and forward P/E of 17 for FY2010. Above are estimated earnings which are routinely beaten by Larsen & Toubro.
2 year target: 120% returns.
4 year target: 300% returns. These are conservative estimates.

When will the value in L&T be unlocked? L&T will be demerged into Power, IT, Ship building and Railway units along with engineering division. Investors will get very good returns after the demerger. So go and invest for long term. You need to invest for 3-4 years to get full benefits from L&T. L&T will enter into lucrative high margin business in the coming quarters especially in the Gulf region.

Verdict: L&T is a “Must have” stock in every portfolio. Like Reliance Industries, L&T also has intrinsic value. One can buy and forget about L&T for 3-4 years. If you believe in India growth story, you should buy L&T; if you don’t believe in India story, you should stay away from stock markets.

Note: I have holdings in L&T and accumulated more on Thursday. I accumulated this stock from 3,900 to 2600. I am a strong favourite of companies like L&T, Reliance and Aditya Birla Nuvo etc. who have inherent strength and they will give excellent returns for the patient investors. .

Stock recommendation: Rajesh Exports

Date:5/30/2008
World’s largest gold jewellery exporter Rajesh Exports stock is getting ready to explode after recent consolidation. Like Unitech, Bangalore based Rajesh Exports is also one of the most investor friendly company in India. Like Reliance, promoters go to any extent (good manipulation?) for the benefit of investors. Rajesh Exports is famous for producing world class jewellery at low cost in large amounts. This is the best stock for long term investors at this price range. Significant news: Rajesh Exports will announce results on June 18, 2008 which may act as trigger for short term bounce back.

Rajesh Exports stock price analysis:
CMP: 86.85.
P/E: 10
Face value: 1
1 year high-low: 169-55.

Rajesh Exports target price:

Short term target: Rs 110-115. This stock will give 30-35% returns within one month.

1-year target: Rs 150-160. Invest in it to get 80-100% annual returns in this counter over the next 2 years.

Why I am recommending Rajesh Exports? 1. World’s largest gold exporter at lowest cost.
2. Stock is currently trading at low valuations.
3. Investor friendly company with a rich history of dividends and bonuses.
4. It is expected to announce very good results on June 18 like other Jewellery companies.
5. Big order book.
6. It will rise after recent consolidation to give good returns to short term investors.
7. Foreign investors increased their stake by 10%.
8. There will be huge demand for low cost jewellery producers in the coming days.

Verdict: Rajesh Exports is the best stock pick for long term investors. This consistent dividend player will give 70-80% annual returns in FY09-10. This share is also a safe bet for even short term investors to get 25-30% returns within 30 days. Foreign investors are silently accumulating this “Multi Bagger”. FIIs bought this stock at around Rs 95 then why should you wait to grab this stock at Rs 86.

Chart courtesy: Bloomberg.

25 GOLDEN RULES

1 Plan your trades. Trade your plan.
2 Keep records of your trading results.
3 Keep a positive attitude, no matter how much you lose.
4 Don't take the market home.
5 Forget your College degree and trust your instincts.
6 Successful traders buy into bad news and sell into good news.
7 Successful traders are not afraid to buy high and sell low.
8 Continually strive for patience, perseverance, determination, and rational action.
9 Limit your losses - use stops!
10 Never cancel a stop loss order after you have placed it!
11 Place the stop at the time you make your trade.
12 Never get into the market because you are anxious because of waiting.
13 Avoid getting in or out of the market too often.
14 The most difficult task in speculation is not prediction but self-control. Successful trading is difficult and frustrating. You are the most important element in the equation for success.
15 Always discipline yourself by following a pre-determined set of rules.
16 Remember that a bear market will give back in one month what a bull market has taken three months to build.
17 Don't ever allow a big winning trade to turn into a loser. Stop yourself out if the market moves against you 20% from your peak profit point.
18 Expect and accept losses gracefully. Those who brood over losses always miss the next opportunity, which more than likely will be profitable.
19 Split your profits right down the middle and never risk more than 50% of them again in the market.
20 The key to successful trading is knowing yourself and your stress point.
21 The difference between winners and losers isn't so much native ability as it is discipline exercised in avoiding mistakes.
22 Speech may be silver but silence is golden. Traders with the golden touch do not talk about their success.
23 Dream big dreams and think tall. Very few people set goals too high. A man becomes what he thinks about all day long.
24 Accept failure as a step towards victory.
25 Have you taken a loss? Forget it quickly. Have you taken a profit? Forget it even quicker!