Showing posts from 2010

How to reduce tax when selling shares

Investors looking for high returns and willing to take high risk, use equity/stock markets as an investment avenue. As an investor, do you know what the tax implications of gains/losses from this investment are? Are you aware of the impact corporate actions (rights issue, bonus, split, dividend) have on you from a tax perspective? If not, it is essential you understand the same so that you're able to minimise tax incidence and increase return on investment. Securities traded on the stock exchange are treated as a capital asset. Hence transacting in securities will lead to a capital gain or a capital loss. Anil purchased 200 shares of Axis bank at Rs. 740 on 10th May 2009, and sold it off at Rs. 820 on 15th March 2010. There was a gain of Rs. 80 per share, which is termed as 'capital gain'. Capital Gain/loss can be either short-term or long-term depending on the tenure for which the secu…

Alok Industries mulls Rs 800 cr capex in next 2 years

MUMBAI: Leading textile player, Alok Industries Ltd has drawn up Rs 800 crore capex plan for the next two years period, a top company official said here.
"We have invested Rs 7,000 crore in the last six years in our expansion programme. In the next two years period, we will further invest around Rs 400-450 crore per annum for our on-going expansion plans," Alok Industries CFO, Mr Sunil Khandelwal said on the sidelines of a conference here.
The company will finance the said funds through internal accruals and debt, Mr Khandelwal said, adding that it has already made a rights issue aggregating Rs 449.59 crore last year and QIP of Rs 425 crore in March 2010.
The company also seeks funds through government's TUFF scheme, which is expected to revive now, he said.
During FY10, the company had incurred a capital expenditure of Rs 1,522.90 crore across various divisions. A major portion of these were towards Phase III and Phase IV expansions, which have been fully completed, se…


IDBI Bank (Rs 179.4): IDBI Bank is in a structural uptrend since the March 2009 low of Rs 39.7. The third leg of this up-move was in progress from August this year. This leg has already achieved its target of Rs 200 and is currently reversing lower. It is possible that the stock now corrects the entire up-move from March 2009 to November this year. That gives the stock minimum downward targets of Rs 153 and Rs 140.
Investors should therefore wait for a decline to these levels before buying the stock. There is a higher support at Rs 170 that can also act as a reversal point for the stock.
If it fails to move to these targets but reverses higher, then wait for a close above Rs 205 before purchasing the stock.

Please let me know the long-term trend of Alok Industries purchased at Rs 26.

Please let me know the long-term trend of Alok Industries purchased at Rs 26.
Alok Industries (Rs 29.2): Alok Industries has not yet emerged from the bear market that gripped the stock in January 2008. The stock was in a sideways range between Rs 17 and Rs 27 for an extended period from last June. This sideways move ended in June this year and the third wave of the up-move from March 2009 is in progress since then.

Simple 1:1 extrapolation of this move gives us the target of Rs 36. The stock is currently reversing lower after recording the peak of Rs 35. Investors therefore need to tread carefully at this juncture since the stock can now decline to Rs 26 or Rs 20 over the ensuing months. Investors can hold the stock as long as it trades above the first target.
Protracted sideways move between Rs 26 and Rs 36 for a few months can help the stock move higher to Rs 43 over the next 12 months. It is hard to envisage a move beyond this level just yet. Subsequent long-term targets are Rs 54 an…

Stock split broadens investor base of company

Ashish Gupta, ET Bureau

A stock split is the partitioning of outstanding shares of a company into a larger number of shares, without affecting stockholders' equity or the total market value of the stock.

For example, if a company declares a 2-for-1 stock split of its stock, which has a current market value of Rs 100 per share, and 1,00,000 shares are outstanding
Before the split:

Outstanding shares: 1,00,000
Market value: Rs 100
Market capitalisation: Rs 1 crore

After the split:

Outstanding shares: 2,00,000
Market value: Rs 50
Market capitalisation: Rs 1 crore
Essentially, in the 2-for-1 stock split, the company's outstanding shares are simply doubled and the stock price is divided in half. The market capitalisation, or market value of the stock, remains the same. This is because stock splits have no impact on the value of a company's stock.

A stock split is merely an accounting transaction in which no equity is exchanged. Companies can split their stock in any number of ways…

IDBI Bank: Buy

Waiving of service charges on low-cost deposits and ambitious branch expansion will help the bank improve its deposit base.

Mr R. M. Malla, CMD…The bank is cashing in on infrastructure financing.
M. V. S. Santosh Kumar
Fresh investments with a two-to-three year time horizon can be considered in the stock of IDBI Bank, the youngest of the public sector banks. The bank focuses mainly on infrastructure lending, a segment expected to contribute heavily to the incremental credit growth of the banking system, going forward.
The recent, much-needed capital infusion from the government will help IDBI Bank support high credit growth. Higher levels of capital would also help decrease cost of funds (by reducing dependence on deposits) for the bank, thereby aiding net interest margin (NIM) expansion. High cost of funds from the time of the IDBI-IDBI Bank merger has been a drag on the bank's NIMs. IDBI Bank's relatively lower cost-income ratio and higher contribution from fee income are key p…

PVR: Buy

Bringing in more audience.
K. Venkatasubramanian
Investors with a two-year horizon can consider buying the shares of PVR, a leading multiplex operator, given the revival in the movie exhibition business, increasing average ticket price as well as occupancies.
A broad-based revival in the economy, a slew of movie releases that held/hold promise and increasing consumer spends which could help augment earnings, with higher food and beverages sales, also underscore our recommendation.
At Rs 173, the share trades at 13 times its likely FY-12 earnings. That is lower than its peer Inox Leisure as well as its own historic valuation levels, which also makes it an attractive bet.
The multiplex industry had an extremely challenging FY-10, what with their standoff with distributors over revenue-sharing and a string of unsuccessful movies.
Almost the entire first quarter of last fiscal went without any movie releases as a result of the tiff with distributors. A recovering economy not enabling dis…

MNC stocks shine on delisting hopes

Minimum public holding rule generates buying interest.

Jayanta Mallick
Kolkata, June 7
The announcement by the Government about the minimum public holding, by way of an amendment in the Securities Contract Act (Regulation) Rules, generated some buying interest in certain multinational companies having public holding below 25 per cent, expecting possible delisting move.
According to SMC Capital, there are 22 MNC outfits listed here, which have less than 25 per cent public holding. "Considering the nature of the MNCs, their foreign parent companies may not be that willing to offload their stake or dilute control. Probably, they may choose the route of delisting," it said.
According to Mr Avinash Gupta, Assistant Vice-President - Research Equity, Bonanza Portfolio Ltd, on Monday, there was buying interest in the companies where the holding of the promoter is higher than 75 per cent with pronounced purchases in case of subsidiaries of MNC's.
In a note, Asit C Mehta Investme…

IDBI Bank net slightly up at Rs 318 cr in Q4

MUMBAI: IDBI Bank Ltd reported a net profit of Rs 318.41 crore for the fourth quarter ended March 31, 2010 as compared to Rs 313.67 crore during the corresponding quarter last year. Total income for the March quarter of 2010 has increased to Rs 4,628.45 crore from Rs 3734.50 crore in the year-ago period. For the year ended March 31, 2010, the bank has posted a net profit of Rs 1,031.13 crore (Rs 858.54 crore) on a total income of Rs 17,563.59 crore (Rs 13,021.55 crore). The board of directors of the bank at its meeting held on April 30 has recommended a dividend of Rs.3 per share.

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IL&FS Transportation Networks emerges lowest bidder for four-laning of Chenani to Nashri Section

IL&FS Transportation Networks has announced that with reference to its bid with the National Highways Authority of India (NHAI) for four-laning of Chenani-Nashri Section of NH-1A from km 89.00 to 130.00 (new alignment) of NH-1A including 9 km long tunnel (2-lane) with parallel escape tunnel in the State of Jammu & Kashmir, the company has emerged as the lowest bidder for the aforesaid project. The bids were opened on April 1, 2010. The project is on annuity basis with concession period of 20 years including a construction period of 1825 days with an estimated cost of Rs 2519 crore. The company has quoted a semi-annual annuity of Rs 317.52 crore for the project. 

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How to invest in dividend stocks

If dividends and capital gains are the two components of return to an investor, how much do Indian investors value dividends? Not much, it seems.

Rajalakshmi Sivam
Indian investors tend to put their money on stocks more for their ability to deliver capital gains than for their yearly dividend payouts. This is also justified by the fact the Indian market as a whole doesn't deliver much of a return by way of dividend.
The current dividend yield for the constituents of the Nifty index (dividends/market price) is less than 1 per cent. Nevertheless, investing for dividends does make sense for investors due to a few reasons. If last year's evidence is anything to go by, dividend payouts tend to be less volatile than company profits, which decide valuations. While the market as a whole may not sport a high dividend yield, investors can still bet on the few stocks that do. Here's an analysis of the trends in dividend payouts of Indian companies and dividend yield stocks, based on a s…

Fortis Healthcare in the pink of health after overseas acquisition

Fortis Healthcare jumped 3.53% to Rs 184.65 at 9:48 IST after the company said it will buy 23.9% of Singapore's Parkway Holdings from US buyout firm TPG Capital as a part of its expansion drive into Asia and the Middle East. The announcement was made before trading hours today, 12 March 2010. Meanwhile, the BSE Sensex was up 50.90 points, or 0.30%, to 17,218.86. On BSE, 17.51 lakh shares were traded in the counter as against an average daily volume of 5.87 lakh shares in the past one quarter. The stock hit a high of Rs 187.45, a record high. It hit a low of Rs 180 so far during the day. The stock had hit a 52-week low of Rs 65.60 on 17 March 2009. The stock had outperformed the market over the past one month till 11 March 2010, soaring 17.45% compared with the Sensex's 6.29% rise. It outperformed the market in past one quarter, spurting 51.46% as against 0.29% decline in the Sensex. The mid-cap healthcare chain has an equity capital of Rs 317.34 crore. Face value per sh…

Suppose you want to know the retail subscription of a current IPO.

1. First go to the NSE's current IPO's page.

2. Select the IPO from the list.

3. Note the "No.of shares offered/reserved" in "Retail Individual Investors (RIIs)" category.

4. Click on "View NSE-BSE Demand Graph".

5. Note the "Total Bids Received at Cut-off Price".

6. Divide figure obtained in Step 5 by figure obtained in Step 3.

7. Multiple the figure obtained in Step 6 by 1.07. (We are multiplying by 1.07 as retail subscription is usually 5%-7% higher than the cut-off subscription.

8. The figure obtained in Step 7 is the approximate current retail subscription figure.

It is not possible to know the exact figure until the end of the day. However the approximate figures are very close to the actual figures.

maithan alloys ltd--multibagger

Maithan Alloys is one of the largest and most profitable manufacturer of manganese alloys in one of the most competitive production locations in the world.
The Company's business model can be encapsulated across the following

The Company commenced commercial production in 1997
with 10 MVA; it grew its installed capacity by 7.5 MVA in 2000 and 8.26 MVA
in 2004 when the market for manganese alloys was weak, indicating its
commitment to the business. The result is a capital cost per attractively lower than the prevailing greenfieid benchmark.

The Company enjoys a long-term power supply agreement with
DVC but going ahead, is commissioning 95 MW at its 15 MVA Meghalaya
facility. The Company also possesses a manganese ore mine in Orissa,

The Company has successfully completed the construction of manganese alloy
plant and captive power plant at Byrnihat in Meghalaya. The project was
commissioned during 1st week of April, 2009, enhancing Company'…

stocks to buy

1infosys  cmp2350  target rs 3175 idfc cmp144  target rs 185 tata steel cmp 530  target  650

shares to buy

the three are good investments - SUZLON is expected to get some relief in the coming budget while FORTIS - target price is 500 in 48 months solid investment (if the market falls to 13,500 levels FORTIS can be bought around 100) I feel that L& T is a bit overpriced for now. You may buy SBI / AXIS BANK / IDBI BANK/ SOUTH INDIAN BANK/ FEDERAL BANK / YES BANK ETC  ....BANK SHARES ARE EXPECTED TO DO WELL IN 6 MONTHS UNLESS RESERVE BANK CHANGES SOME POLICY.... HRHR - HIGH RISK HIGH RETURNS - WIRE AND WIRELESS All the best

Best Regards,
Ramanathan N.S.
00968 96915246(Mob-Oman)

ARSS Infrastructure — IPO: Invest

A sizeable order book, strong sales and profit growth, and a secure client base in government contracts bode well for the offer.

Major exposure to the Railways segment provides high margins. Bhavana AcharyaA relatively low asking price and a focus on government projects make the offer from ARSS Infrastructure Projects a reasonable bet, but only for investors with a high-risk appetite.A construction contractor in the Railways and roadways segment, the company plans to raise Rs 103 crore from this issue to fund working-capital and joint ventures.In its price band of Rs 410-450, the offer is at a valuation of 8.6 to 9.5 times the estimated FY-11 per share earnings on a post-offer equity. Reasonable valuations notwithstanding, given the risks to the business, investors are advised to exit the stock if it touches about a 21 per cent return.ARSS has a high exposure to Railways (which offer higher margins) and roadways, a sizeable order book, strong sales and profit growth, and a se…

Power Finance Corporation: Buy

Fresh investments can be considered in the Power Finance Corporation (PFC) stock that appears a good defensive bet within the financial sector.The company's loan book grew at a strong pace of 20 per cent in 2009 despite lower demand for credit witnessed by the banking sector. At current market price of Rs 252, the PFC stock is trading at 10.5 times its estimated FY11 earnings and two times its estimated adjusted book value, which does not reflect the strong earnings growth posted by the company.Near-zero non-performing assets and a high proportion of floating rate assets (87 per cent) allow PFC to pass on interest hikes and minimise credit risk. Strong earnings growth (36 per cent for nine months ended December 31, 2009, adjusted for extraordinary items), superior profitability (Return on Equity of 17 per cent) and the insatiable funding requirements of the power sector make for bright growth prospects.The outlook for power financing looks promising given that investment…

Blockbuster third quarter for multiplexes

Back-to-back hits ensure rising revenues for multiplexes. Varada BhatMumbai, Jan. 29The smiles are back on the faces of multiplex operators thanks to a buoyant third quarter. This has largely been propelled by a good line-up of movies and higher ticket prices.Cinemax's net profit increased almost five times to Rs 10.59 crore (Rs 2.05 crore) for the period ending December 31, 2009. Revenue from operations was up 81 per cent to Rs 59.39crore (Rs 32.72 crore).Inox more than doubled its profit to Rs 8.74 crore (Rs. 3.99 crore) while revenues jumped 29 per cent to Rs. 84.28 crore (Rs. 65.48 crore).PVR, likewise, reported a higher profit of Rs 7.37 crore (Rs 4.5 crore); its income was up to Rs 114 crore (Rs 88.29 crore)."The good line-up of movies, be it Hindi, English and regional languages, contributed significantly to our performance." said Mr. Deepak Asher, Director, Inox Leisure.According to Mr Anil Arjun, Chief Executive Officer, Reliance MediaWorks, this quart…

nokia shortcuts

*#0000# displays the phone model, software version, and date the software
was made. The phone model displayed may be Nokia's internal phone model
code, which is different from the modfel number under which the phone is
> *#06# displays the IMEI (International Mobile Equipment Identifier) of
> your phone.
> *#2820# (*#BTA0#) shows the bluetooth address of your phone.
> *#62209526# (*#MAC0WLAN) displays the MAC address of the wireless LAN
> adapter in your phone. This only works if your phone has Wi-Fi.
> *#92702689# (*#war0anty#) displays the life timer of your S60 phone (the
> total time of phone calls in hours and minutes). The only way to reset
> this timer is to flash your phone's firmware.
> *#7780# (*#rst0*) is the code to soft-reset your phone. This
> non-destructive reset will reset phone settings like profiles, themes and
> shortcuts. Data like contacts, calendar and notes are not removed.
> *#7370# (*#RES0#) resets your phone to default fact…

Govt to dilute stake in 3 shipping cos

MUMBAI: The government will divest its stake in three shipping companies — Cochin Shipyard, Shipping Corp of India (SCI) and Dredging Corp of India (DCI) — in the next fiscal, a top Shipping Ministry official said. "We have received a proposal from Cochin Shipyard for an IPO to raise funds for expansion. This could be through an issue of fresh equity shares of about 10 per cent," K Mohandas, Secretary - Ministry of Shipping, said. In both SCI and DCI, the government is likely to dilute at least 10 per cent stake, he said. The shipping ministry is evaluating the disinvestment process in SCI and DCI and will take a final call on the issue early next fiscal (2010-11), Mr Mohandas said. Cochin Shipyard is likely to come out with its IPO first, he said. While he would not commit a time-frame, it is understood that both the IPO and Government disinvestment process would take place in the next six to nine months. - PTI

Allahabad Bank: Buy

The bank's strategies to increase low-cost deposits and reduce dependence on whole-sale deposits have started yielding results .

As the bank becomes 100 per cent CBS-enabled, fee-income may improve. M.V.S Santosh KumarInvestors can consider accumulating the Allahabad Bank stock, which is a defensive pick in the banking space. The bank has posted higher-than-industry credit growth so far this fiscal with lower slippages, thereby increasing its market share in advances. The Allahabad Bank stock is trading at a significant valuation discount to its peers.At current market price of Rs 133, the stock is trading at a price earnings multiple of nearly 5 times on estimated FY10 earnings and a price to FY10 adjusted book value (estimated) of 0.88.The bank had formulated strategies to increase low cost deposits and reduce dependence on whole-sale deposits while improving yields and fee income. These have started yielding results, with the bank witnessing sharp improvement in opera…

Disinvestment talks trigger buying in PSUs

'Several mutual funds have launched PSU Funds'.
Our BureauMumbai, Jan. 15Shares of Government-owned companies gained between 5 and 20 per cent on Friday on talks of stake sales in some of them.The BSE PSU index gained 2 per cent. Sensex and Nifty closed in the red.Engineers India Limited gained 20 per cent and hit the upper circuit after the Government announced a 10 per cent divestment in that company. The State owns a 90.40 per cent stake in Engineers India. The stock closed at Rs 2079.70 on the BSE.The other such counters that gained on Friday were State Trading Corporation, Dredging Corporation of India Ltd, Hindustan Copper, NMDC, Rashtriya Chemicals and Fertilisers Ltd, MMTC, BEML. The Government's holding in these companies is more than 90 per cent.The Cabinet approval for disinvestment in Engineers India has brought renewed buying interest in other PSU stocks such as NMDC, GMDC, FACT, RCF, ITI, HMT, HOCL, National Fertilizer Ltd etc, said Mr Alex Mathews …

$100 bn investment potential in education sector over 5 yrs: Experts

NEW DELHI: The country's fast-growing education sector holds a
potential to attract a whopping $100 billion (about Rs 4.57 lakh
crore) investment over the next five years driven by demand for
skilled professionals and need for infrastructure development, say

Sector experts are upbeat about the growth visible now and believe it
could turn into one of the most preferred sectors for investment by
venture capitalists and private equity players going forward.

"The education sector presents an investment potential of $100 billion
over the next five to six years. Venture capitalists and private
equity players will have a role to play in the expansion going
forward," KPMG director Strategic and Commercial Intelligence Dushyant
Singh said.

Moreover, experts feel by enabling private participation in education,
private players can have a significant role in expanding the sector.

According to education and training provider Zee Learn, which is a
division of ETC Networks, there is huge g…