DG - Black Money

India mum over secret bank accounts Germany has revealed that some Indians have allegedly been amassing money with a German bank. However, India is stoic about spilling the beans as it would drag some top brass into the legal net, which may endanger its power at the Centre..                 A VERITABLE Pandora’s box of secret information regarding top Indian tax evaders who have secret bank accounts operating in Germany, is awaiting to be opened. It might include some top Indian politicians and businessmen. While the German authorities have offered this information free of cost, surprisingly, neither the Prime Minister’s Office nor the Ministry of Finance has shown any interest in getting the details, which may net some big fish. Speculations are rife that the huge amount of money belongs to some powerful Indian politicians, industrialists and stock brokers. The government of India is, however, apprehensive of spilling the beans as it would leak names of high-profile persons holding government offices, which can potentially damage its power at the Centre. The information was obtained by the German intelligence agency, Bundesnachrichtendienst (BND). It has details of more than 700 accounts of LTG Bank run by the crown prince of Liechtenstein, a country, which is considered a tax heaven for the rich and powerful the world over. It is believed that the information with the German government contains records of many Indians who have their accounts with a private bank in Leichenstein, a global hub for rich and famous to park secret funds. Criticising the languid approach of the Indian government towards uncovering this racket, Transparency International (the global civil society organisation leading the fight against corruption) said that the information lying with the German authorities should be obtained at the earliest. It has urged India to take all necessary steps to seek the data that the Germany had offered, free of charge in February 2008. Chairman, Transparency International India, Admiral (retired) RH Tahiliani said, “This money belongs to the people of India and it is possible that it has been tucked away in this distant country by those who have acquired it illegally and are now evading tax. There should be complete transparency and accountability about this money and it is for the government to find this out and inform people.” It is pertinent to mention that the German government had offered to provide information about secret accounts to various countries, including India, free of cost. While most of the countries including USA, Finland, Norway, Sweden, Canada, Italy, Britain and other countries had expressed interest in obtaining the data, the Indian government maintained a stoic silence. Transparency International has said that neither the Finance Ministry of India nor the PMO has shown any interest in investigating those Indians, who have deposited their ill-gotten wealth in the secret accounts of that country. It has also raised questions regarding the use of such secret accounts for funding global terrorism. More importantly, it said that people of India have a right to know about the details. It belongs to us and cannot be denied to us for long. It is high time we all demanded what is rightfully ours.   original article can be seen at http://www.merinews.com/catFull.jsp?articleID=

 

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DG - FW: Sharekhan Post-Market Report dated September 29, 2008

 

 

From: The Sharekhan Research Team [mailto:marketwatch@research.sharekhan.com]
Sent: 29 September 2008 17:01
To: The Sharekhan Research Team
Subject: Sharekhan Post-Market Report dated September 29, 2008

 

Sharekhan's daily newsletter Visit us at www.sharekhan.com September 29, 2008   Index Performance Index Sensex Nifty Open 13,109.96 3,990.20 High 13,113.53 3,997.55 Low 12,402.84 3,777.30 Today's Cls 12,595.75 3,850.05 Prev Cls 13,102.18 3,985.25 Change -506.43 -135.20 % Change -3.87 -3.39   Market Indicators Top Movers (Group A) Company Price  (Rs) % chg Gainers Power Finance 126.05 3.49 Nestle 1,689.85 3.05 IRB Infra 119.15 2.54 BPCL 341.40 1.50 CESC 281.85 1.18 Losers HDIL 166.05 -13.72 United Breweries 200.75 -13.69 IB Securities 38.45 -13.30 Financial Technologies 1,071.35 -12.58 Bajaj Hindusthan 104.80 -12.34 Market Statistics - BSE NSE Advances 357 113 Declines 2,287 1,113 Unchanged 41 20 Volume(Nos) 27.45cr 55.45cr  Market Commentary  Battered and bruised Weakness in metal, oil, and realty stocks took a heavy toll on the market and the Sensex shed 3.87% at close. The market’s southbound journey continued, as slump in global indices and concerns of a possible recession in the USA made the investors edgy, triggering a major sell-    off. The Sensex started the day on a positive note at 13,109, up seven points and hovered above its last close of 18,114 till the early morning trades. However, a strong bout of selling in afternoon saw the Sensex amass losses of 700 points to touch the day's low of 12,403. The Sensex dropped 3.87% and was down 506 points for the day at 12,596. The Nifty shed 3.39% and was down 135 points at 3,850. All the 13 sectoral indices were mauled by 1-6% each. The BSE Bankex was the major loser and crashed by 6.02%, followed by the BSE CD (down 5.68%), BSE IT (down 5.47%), BSE Realty (down 5.26%), BSE Power (down 5.22%) and BSE Teck (down 5.13%). The second-rung benchmark indices--BSE mid-cap and BSE small-cap tanked by over 3-4% each. The market breadth was negative. Of the 2,685 stocks traded on the BSE, 2,287 stocks declined, while only 357 stocks advanced. Fourty one stocks ended unchanged. Except Hindustan Unilever Ltd (HUL), the other 29 stocks that makes the Sensex ended lower. Among the major losers, ICICI Bank crashed by 13.23% at Rs487, Jaiprakash Associates plunged by 11.77% at Rs106.80, Satyam Computer Services slumped 9.30% at Rs292, Tata Consultancy Services crumbled 8.86% at Rs616.55. Tata Power plummeted by 6.75% at Rs920.05, Mahindra & Mahindra dropped 6.69% at Rs495, Reliance Infrastructure shed 6.43% at Rs795 and Reliance Communications tanked 6% at Rs257. Other heavyweights also came under sustained selling pressure and lost 2-5% each. However, HUL gained 0.79% at Rs254.50.  Over 1.41 crore shares of Reliance Natural Resources changed hands on the BSE followed by IFCI (0.89 crore shares), Chambal Fertlisers & Chemicals (0.71 crore shares), Jaiprakash Associates (0.63 crore shares) and ICICI Bank (0.58 crore shares). In value terms, Reliance Capital registered a turnover of Rs309 crore on the BSE followed by Reliance Industries (Rs299 crore), ICICI Bank (Rs295 crore), Axis Bank (Rs157 crore) and Larsen & Toubro (Rs134 crore). European Indices at 16:45 IST on 29-09-2008 Index Level Change (pts) Change (%) FTSE 100 Index 4917.69 -170.78 -3.36 CAC 40 Index 4036.29 -127.09 -3.05 DAX Index 5892.05 -171.45 -2.83 Asian Indices at close on 29-09-2008 Index Level Change (pts) Change (%) Nikkei 225 11743.61 -149.55 -1.26 Hang Seng Index 17880.68 -801.41 -4.29 Kospi Index 1456.36 -19.97 -1.35 Straits Times Index 2361.34 -50.12 -2.08 Jakarta Composite Index 1832.50 -13.58 -0.74 To know more about our products and services, click here. “This document has been prepared by Sharekhan Ltd. This Document is subject to changes without prior notice and is intended only for the person or entity to which it is addressed to and may contain confidential and/or privileged material and is not for any type of circulation. Any review, retransmission, or any other use is prohibited. Kindly note that this document does not constitute an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. SHAREKHAN will not treat recipients as customers by virtue of their receiving this report. The information contained herein is from publicly available data or other sources believed to be reliable. While we would endeavour to update the information herein on reasonable basis, SHAREKHAN, its subsidiaries and associated companies, their directors and employees (“SHAREKHAN and affiliates”) are under no obligation to update or keep the information current. Also, there may be regulatory, compliance, or other reasons that may prevent SHAREKHAN and affiliates from doing so. We do not represent that information contained herein is accurate or complete and it should not be relied upon as such. This document is prepared for assistance only and is not intended to be and must not alone betaken as the basis for an investment decision. The user assumes the entire risk of any use made of this information. Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. We do not undertake to advise you as to any change of our views. Affiliates of Sharekhan may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.  This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject SHAREKHAN and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. SHAREKHAN & affiliates may have used the information set forth herein before publication and may have positions in, may from time to time purchase or sell or may be materially interested in any of the securities mentioned or related securities. SHAREKHAN may from time to time solicit from, or perform investment banking, or other services for, any company mentioned herein. Without limiting any of the foregoing, in no event shall SHAREKHAN, any of its affiliates or any third party involved in, or related to, computing or compiling the information have any liability for any damages of any kind. Any comments or statements made herein are those of the analyst and do not necessarily reflect those of SHAREKHAN.” To unsubscribe write to myaccount@sharekhan.com

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Money Times Sep. 29 - Oct. 5, 2008

 

Page 1

Caution: Please note that your copy/access to our website is for your exclusive use only. Any attempt to share your access to our

website or forwarding your copy to a non-subscriber will disqualify your membership and we will be compelled to stop your supply

and forfeit your subscription thereafter without any refund to you.

T

I

M

E

S

A TIME COMMUNICATIONS PUBLICATION

VOL. XVII No. 46

Monday, Sept. 29 – Oct. 5, 2008

Pages 19

Weakness to persist

as follow-up buying remains elusive

By Sanjay R. Bhatia

The weakness in the markets continued to persist last week as the Nifty slipped below the 4000 mark. Follow-up buying

remained elusive after the previous Friday's smart rally. Selling pressure was evident at higher levels as buying remained

thin. Traders and speculators were seen selling and also going

short. Incidentally, FIIs remained net sellers in the cash market

but were net buyers in the derivatives segment. Mutual Funds,

too, were net sellers during the week.

1

The global cues continued to remain weak. The markets have

still not given the thumbs up to the US Government's bailout

package for the big financial institutions, which are reeling

under heavy losses due to the sub prime crisis. Crude oil

continued to display volatility as it touched the $130 level intra-

day on the day of the September Futures expiry.

On the domestic front, inflation rate remained unchanged. The

market sentiment is negative due to lack of follow up buying

support at higher levels. Further fall is likely as participation has

remained dull on the buying side. Any negative news is likely to

witness a sell-off. Meanwhile, the markets are likely to keep a eye on global cues before the Q2 results start from the

second week of October when stock specific action will be witnessed.

On the upside, the Sensex faces resistance at 13454, 13791, 14141 and 14677 levels but it has support at 12961, 12575 and

12400 levels. On the upside, the Nifty faces resistance at 4016, 4074, 4108, 4189 and 4482 levels while 3816 and 3608 are its

important support levels.

Investors should abstain from taking long positions as regular profit booking will be witnessed.

The million dollar question

By Fakhri H. Sabuwala

Whenever the market goes through a lull, the most pertinent question that surfaces is: Why did we not sell when the

going was good? This question and predicament of not selling haunts us further and acutely so when the markets do not

appear in a mood for reversal and turn volatile with a downward bias.

Booking profits is always prudent but selling a growth scrip albeit too early robs one of the thick fat wealth, which

otherwise would accrue with time. Booking profit would have been fatal in the whole of 2007 as the market was in the

grip of bulls and there was an upbeat mood all around. But it is not so in the current times. Today, the market is

rangebound and with no big upside trigger over the horizon. Hence booking profits is not only important but also

prudent too.

BAZAR.COM

---

Page 2

Any serious trader at Dalal Street must indulge in booking profits regularly as this alone can make your trading

disciplined and a sustainable activity over a long time frame. By booking profits in a market that lacks secular direction

one cuts short the risk of an overnight stay in a scrip.

Every stock has a systemic risk or market risk that is associated with it. And given the current state of the market, there is

no guarantee whether the markets will favour the bulls or bears next. Manish Sonthalia of Motilal Oswal explains this

when he says "if the markets fall, the stocks will fall even if they are of good value". There are two ways of mitigating

risks in such times. First is by curtailing losses by adopting the strategy to sell now and buy later. This way, one cushions

oneself against imminent losses. The second way of hedging your risk is by diversifying your portfolio. It should not be

sector wise of industry wise. Instead, you must go overweight in value stocks and go underweight on momentum stocks.

The hedging of risks from momentum to value can be made by shifting to large caps that can withstand the currents

rather than less sensitive stocks.

Booking of profits, too, has ways and means of neat execution. Some experts believe that 7% to 10% movement in a stock

in less than a fortnight may signal such booking of profits. The higher the beta factor of a stock the rapid must be the

booking of profits.

It may be very simple to book profits in a market with a one way trend but in a volatile rangebound market of today, the

averaging strategy does not work. The only way out is to adopt a disciplined approach and take decisions on a case by

case basis. It is prudent to have a risk reward ratio for traders in a directional market at around 1:5 but can be 1:2.5 or 1:3

in a rangebound, volatile market.

Despite all the prudence, there exists one school of thought (may be the Buffet types), which does not recommend

booking of profits as long as the stock enjoys the high growth story. What's the point in losing out an infinite gain by

safeguarding a 5% to 25% capital erosion in such times. They believe in staying invested in growth stocks. 'What's the

need to pull down the shutters of a prospering business?' they ask.

So at the end of the day, the answer to this million dollar question is – Think before you act. That's the bottomline.

Sideways volatile moves persist

TRADING ON TECHNICALS

2

By Hitendra Vasudeo

Last week, the Sensex opened at 14251.33, attained a high at

14221.04 and fell throughout the week to a low of 13054.42 to

finally close the week at 13102.18. It thereby showed a net

fall of 940 points on a week-to-week basis. As a result of the

last week's movement and closing, the Sensex gave a lowest

weekly close of the entire fall from the peak of 21206 till date.

The Sensex on the weekly chart also formed an Engulfing

Bear candlestick pattern.

Support will be at 12822-12558-12316. Resistance will be at

13459-13864-14221.

Sensex Wave Analysis

Normal Count

Wave I-2594 to 3758

Wave II-3758 to 2904

Wave III- Internals are as

follows:

Wave 1- 2904 to 6249

Wave 2-6249 to 4227

Wave 3-4227 to 12671

Wave IV- 12671 to 8799

Wave V- 8799 to 21206

Wave W-21206 to 14677

Wave X-14677 to 17735

Wave Y- 17735 to 12514

Wave X- 12514 to 15106

Internals of Wave X

Wave a- 12514 to 15130

Wave b-15130 to 13727

Wave c-13727 to 15579

WEEKLY UP TREND STOCKS

Let the price move below Center Point or Level 2 and when it move back above Center Point or Level 2 then buy

with what ever low registered below Center Point or Level 2 as the stop loss. After buying if the price moves to

Level 3 or above then look to book profits as the opportunity arises. If the close is below Weekly Reversal Value

then the trend will change from Up Trend to Down Trend. Check on Friday after 3.pm to confirm weekly reversal

of the up Trend.

Last

Center

Relative

Weekly

Up

Close

Point

Strength Reversal Trend

Scrips

Level 1 Level 2

Level 3 Level 4

Value

Date

Stop

Loss

Buy

Price

Buy

Price

Book

Profit

Book

Profit

HINDUSTAN UNIL. 252.50

231.2

244.6

250.1

258.0

271.4

77.0

247.9

26/09/08

SPICE COMMUN.

76.30

75.5

76.0

76.3

76.6

77.1

76.1

75.7

08/08/08

GLAXO SMITHKLIN 1199.00 1021.3

1129.3

1167.7

1237.3

1345.3

75.4

1183.3

01/08/08

ITC

192.25

167.5

183.9

192.0

200.3

216.7

68.5

191.1

05/09/08

TATA COMMUN.

466.10

395.9

441.6

462.8

487.3

533.0

68.4

443.0

05/09/08

---

Page 3

Wave d-15579 to 14002

WEEKLY DOWN TREND STOCKS

Wave e-14002 to 15106

Wave Z- 15106 to 12558

(not yet complete)

Wave Z could test the

lower range 12558-12316.

The termination of Wave

Z is likely from the range

of 12558-12316. If that

happens, then one leg of

the corrective cycle will

be complete and it can

slide down to 10940-9875

to an outer extent.

Conclusion

Some weakness could still

be witnessed to complete

one leg of the corrective cycle. Recovery from the lower support range cannot be ruled out as the nature of market is

sideways and volatile.

Let the price move above Center Point or Level 3 and when it move back below Center Point or Level 3 then sell

with what ever high registered above Center Point or Level 3 as the stop loss. After selling if the prices moves to

Level 2 or below then look to cover short positions as the opportunity arises. If the close is above Weekly Reversal

Value then the trend will change from Down Trend to Up Trend. Check on Friday after 3.pm to confirm weekly

reversal of the Down Trend.

Last

Center

Relative

Weekly Down

Close

Point

Strength Reversal Trend

Scrips

Level 1 Level 2

Level 3 Level 4

Value

Date

Cover

Short

Cover

Short

Sell

Price

Sell

Price

Stop

Loss

BRAHMANAND HIM 11.05

7.8

10.2

11.8

12.7

15.1

8.22

13.96

29/08/08

SOBHA DEVELOP

189.75

144.8

178.4

200.5

211.9

245.5

17.58

235.11

12/09/08

INDBULLS REAL

184.95

102.3

161.7

197.9

221.1

280.5

20.42

235.11

22/08/08

UNITECH

111.05

75.9

101.8

118.4

127.7

153.6

21.93

137.44

22/08/08

IDFC

73.40

57.8

69.3

76.6

80.7

92.2

21.96

84.28

16/05/08

Strategy for the week

Overall strategy remains to exit long positions on spurt to resistance levels of 13459-13864-14221 as the opportunity arises.

* The corporate raider who was eyeing Hindalco a year and a half back may again turn active as the share is available at

half the price together with Novelis.

TOWER TALK

* FIIs continue to offload and the market continues to bleed with many scrips making new daily lows irrespective of their

intrinsic worth.

* ITC & HUL are the only scrips standing rock solid in the carnage since January 2008. This means that big players are

bullish on the domestic consumption story.

* Time and again, the market goes to extremes on either side and even surprises retail investors, who hold on to scrips in

the belief that share prices can't fall further.

* Distress selling by FIIs on the Indian bourses has put domestic investors in distress!

* Hats off to Indian punters, jobbers and operators! They still exist and are melodiously humming "Jeena yahan, Marna

yahan…iske siva jaana kahaan?". That's the spirit.

* West Bengali's loss in Uttarakhand's gain – Nano style. The comrades lose one more vote of confidence, this time from

the industrialists.

* Sterlite Tech's recent acquisition of Brand-Rex of UK, a cabling company shall enable it to increase its cable wire

solutions in world markets to 8% from 4%.

* Cement prices are likely to go up by Rs.3 to Rs.5 per bag in October 2008. Look out for cement majors in coming days.

* GAIL and L&T go ex-bonus in few days from now. Marketmen expect GAIL to touch Rs.400 and L&T Rs.2000 in a few

months from now.

* Gold sparkles on the back of a financial crisis in the West. Experts see it cross Rs.15000 for 10 gms by March 2009.

* United Phosphorous has announced 31 October as record date for 1:1 bonus issue. It makes sense to pick up this cum

bonus stock at current low prices.

* Ranbaxy is a decent medium-term pick as it has corrected heavily. With the promoters increasing stake and the US

problems getting resolved, the stock is bound to appreciate.

* JMC Projects is being fancied as a decent stock with good order book and cheap valuation.

* Indian Hume Pipes, which caters to water infrastructure projects, has yet to utilize its huge surplus land bank. A value

stock.

* With a likely EPS of over Rs.16 in FY09, Bharat Gears is a good buy.

* Major expansion will trigger decent growth in the bottomline of Amara Raja Batteries. Some analysts strongly

recommend the share for decent gain in the medium term.

* With massive investments of over Rs.175 cr. in the last two years, the shares of Hanung Toys & Fabrics are an excellent

buy.

* Knowledgeable investors are acquiring the shares of VST Tillers & Tractors as it may relocate its plant from its highly

valued Bangalore property. With a likely EPS of over Rs.30, the share is going cheap.

3

---

Page 4

* Having bagged Rs.1100 cr. order for its pipes, Man Industries is a value buy and can fetch over 50% returns in the long-

term.

* A mutual fund analyst recommends Rolta, which is a major beneficiary of the nuclear deal. Its sales may exceed Infosys

if things work as per plan.

* Market grapevine has it that Austin Engineering is likely to post an EPS of Rs.24 in the current year and may even

surprise the market with a liberal bonus.

* Som Distilleries is reportedly faring well and can post an EPS of Rs.8 in FY09 and Rs.12 in FY10. Long-term investors

can pick up this scrip.

* Celestial Labs has been attracted good investment buying. Knowledgeable persons project an EPS of Rs.11 in FY09 and

a share price of Rs.45.

* In this nervous market, Godawari Power can be bought for decent appreciation in the long-term. It has been allotted

coal and iron ore mines, which will push up earnings significantly. Sources expect an EPS of Rs.60 in FY09 and Rs.80 in

FY10.

* With an estimated consolidated EPS of Rs.10, the shares of Lumax Auto Tech are an excellent buy. Sources expect a gain

of 50% in the medium-to-long-term.

4

By Saarthi

BEST BETS

KEI Industries Ltd. (Code: 517569)

Rs.28.05

Founded in 1968, KEI Industries Ltd. (KEI) is a complete cable solutions company with the widest range of cables

encompassing high tension & low tension power cables, control and instrumentation cables, rubber cables, flexible &

house wires, submersible cables, OVC/poly wrapped winding wires, and stainless steel wires etc. It is also one of the few

companies in country to manufacture speciality cables including braided cables, fire survival and Zero halogen cables. In

fact, KEI is ranked among the top three cable companies in India. It has the capabilities to address the demand across a

cross-section of sectors such as power, oil refineries, railways, automobiles, cement, steel, fertilizers, textile, real estate and

the retail segment. The company derives major revenue through institutional sales to industry stalwarts like L&T, BHEL,

NTPC, ABB, Alstom, Jindals, Tatas, Reliance ADAG, GAIL, Suzlon, SAIL, Power Grid Corpn., various State Electricity

Boards and ONGC to name a few. Of late, KEI has started focusing on the lucrative retail segment through aggressive

advertising and marketing of house wires & flexible wires. Since FY08, it has also ventured into power EPC segment

(Engineering, Procurement and Construction) and has already been awarded breakthrough orders. To execute them, it

has set up an exclusive EPC Division and has hired key manpower to scale up this new business multifold in the next

couple of years.

Currently, KEI has four manufacturing

facilities spread across Delhi, Silvassa,

Bhiwadi (Rajasthan) & Chopanki

(Rajasthan) with combined installed

capacity of 47,000 km of LT cables, 3000

km of HT cable and 25000 km of house

wire. It commissioned its Chopanki

plant,

a

100% Export

Oriented

Undertaking (EOU) with an installed

capacity of 10,000 kms of LT power

cable in FY08 only. KEI has been

exporting its products to Canada, South

Africa, Australia, USA, France, Italy,

Germany, UK, Abu Dhabi, Malaysia,

Mauritius, Sri Lanka, etc. and its new

EOU unit will further boost exports. On

the back of the robust demand, all its

plants are working at 100% capacity

utilisation and the company has an all

time high order book position of more

than Rs.400 cr. To cash in on the

buoyancy in the industry, KEI is

expanding its LT cable capacity by 7000

km at its Bhiwadi plant and is also

For F&O Traders

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---

Page 5

5

adding 1500 kms of HT cable capacity at the Chopanki unit. The expansion project is near completion and is expected to

commence production shortly. Further, it is upgrading the HT cable capacity up to 132 kV, of which testing of 66 kV has

been already successfully completed. To widen its product range, KEI is considering a technical collaboration or a joint

venture for the Extra High Voltage (EHV) cable project. The EHV cables will receive an excellent response as massive

demand exists from underground cabling as cities across the country move from overhead cabling to underground

cabling options.

KEI's focused advertising campaign has not only helped it to increase visibility and retail sales but also helped it to

further strengthen its dealer network and enhance the vendor approval status from contractors to ensure repeat sales.

The management is confident of expanding the export market, retail market and EPC segment besides maintaining the

sales momentum to institutions. It has taken steps to grow the export market by enlarging the international marketing

team and by participating in international fairs and exhibitions and by filing for certifications to sell in new geographies

and by opening a marketing office in Dubai. For FY08, it recorded 45% growth in sales to Rs.875 cr. with nearly 10% rise

in net profit to Rs.43.50 cr. posting an EPS of more than Rs.7 on its equity of Rs.12.20 cr. In FY07, the company had raised

around Rs.150 cr. via FCCB, which can be converted into equity at Rs.81 per share. Out of the 7200 bonds, only 670 bonds

have been converted till date and the chances of the balance 6530 bonds getting converted is bleak considering the current

market price. Although KEI has reported lower profit margins over the last two quarters due to increase in raw material

costs and other expenditure, it is still expected to clock a turnover of Rs.1200 cr. with PAT of Rs.45 cr. for FY09. This

translates into an EPS of more than Rs.7 on its current equity. Despite higher interest cost & high debt:equity ratio, KEI is

trading fairly cheap at a current enterprise value of around Rs.500 cr. Investors are advised to buy the stock at current

levels as its share price can easily appreciate by 50% within a year.

Man Industries (India) Ltd. (Code: 513269)

Rs.58.95

Established in 1988 as an aluminium extruder, Man Industries India Ltd. (MIIL), today, is one of the largest producers

and exporters of large diameter Longitudinal submerged arc welded (LSAW) pipes and Helically submerged arc welded

(HSAW) pipes. These pipes are made from steel plates and steel coils. LSAW line pipes are generally used in

transportation of oil and natural gas under high temperature and pressure in refineries and petrochemical units apart

from finding application in fertilizers and the dredging industry. On the other hand, HSAW pipes are used under low

pressure conditions for transportation of oil, water, sewerage, agriculture and in the construction sector. The company has

the capability to manufacture LSAW pipes with outer diameter ranging from 16-60 inches and wall thickness of 6-38 mm

upto a maximum pipe length of 12 mtrs. Whereas for HSAW, it can make pipes having 16-84 inches of outer diameter

upto maximum length of 18 mtrs. In fact, it is the only company in India to manufacture 18 mtrs long HSAW pipes. MIIL

is also a leading provider of anti-corrosion coatings and cement mortar coatings for SAW pipes. Besides, it is a significant

size player in spirally welded pipes as well.

Currently, MIIL has two manufacturing plants – one at Pithampur, MP, and the other at Anjar, Gujarat having combined

installed capacity of 500,000 MTPA of LSAW pipes and 300,000 MTPA of HSAW pipes. Out of this, a new production line

of 200,000 MTPA of HSAW pipes was commissioned only in September 2007. Importantly, a couple of days back, MIIL

has started another production line for HSAW pipes with a name plate capacity of 200,000 MTPA thereby equalising the

total production capacity to 500,000 MTPA each. Along with this, the company has bagged new orders to the tune of

Rs.1100 cr. (domestic Rs.700 cr. & export Rs.400 cr.) taking the current order book position to Rs.1500 cr. It has recently

bagged a single order worth nearly Rs.1000 cr. from a single US client, which speaks of its strong credentials and

execution capability. With a vision to become a true global player, MIIL has acquired 155 acres of land in Little Rock,

USA, for putting up state-of-the-art HSAW pipe manufacturing plant having capacity of 300,000 MTPA at an estimated

investment of Rs.400-450 cr. This project is expected to commence operation by FY10 if things worked out as per plan.

The demand for SAW pipes is significantly dependent upon the level of exploration activities and transportation of oil

and natural gas in India and globally, which is currently being driven by strong crude oil prices. Incidentally, the

concentration of sources of crude oil in the Middle East augurs well for Indian pipe manufacturers as they have the

advantage of being in close proximity compared to other major pipe manufacturers in Japan or Europe. A recent entrant

in the growth drivers of pipes is the demand arising from the replacement of old pipelines, predominantly in the USA

and Russia. Moreover, the domestic demand is also high as various organisations have put up plans to lay the pipeline

infrastructure for oil transportation. To conclude, the easing of steel availability post Beijing Olympics and the downward

trend in the metal prices globally and the significant correction in shipping freight will have a positive impact on the

MIIL's bottomline going forward.

In order to fund its expansion, MIIL had raised around Rs.200 cr. in May 2007 through the FCCB route to be converted

into equity shares at 143.50 per share. Since then, not a single bond has been converted and considering the CMP the

chances of conversion in the near future is minimal despite downward revision in the conversion price. For FY08, its sales

as well as net profit increased by 30% to Rs.1500 cr. and Rs.71 cr. respectively. Thus it posted an EPS of Rs.13 on its equity

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Page 6

of Rs.26.65 cr. having a face value of Rs.5 per share and declared 30% dividend. Although the company posted

disappointing Q1FY09 results, still on the back of the expanded capacity it may report a topline of Rs.1750 cr. with a

bottomline of Rs.75 cr. i.e. an EPS of Rs.14 on its current equity. Moreover, the company's share price has drastically

corrected by 70% from its high of Rs.177 in January 2008. Investors can safely buy this scrip at current levels for a price

target of Rs.90 within 9-12 months.

Sanwaria Agro Oils Ltd.: Add on declines

ANALYSIS

By Devdas Mogili

Sanwaria Agro Oils Ltd. (SOAL) is a 17-year old Madhya Pradesh based company established in 1991, is a part of the

Sanwaria Group. Its production facilities are undergoing expansion both organically and inorganically leading to a total

combined capacity of 2000 - 2200 MT per day in the next two years from 1000 MT to 3000 MT. Mr. Ram Narayan Agarwal

is the chairman of the company.

The company is focused on the retail branded products and the expansion of its retail product basket by inclusion of

mustard oil, cotton seed oil, soya flour and other value added soya based products. SAOL also plans to venture into the

production and marketing of value added soya based products by setting up a soya flour plant, soya nuggets, soya

granules and protein isolates.

Soya bean has varied uses and finds its way into food products and industrial products. The edible uses of soybean

includes baby foods, bakery ingredients, breakfast cereals, cooking oils, dietary supplements, emulsifying agents, food

drinks, salad dressings and soups. It has many industrial uses such as adhesives, animal care products, anti-corrosion

agents, antibiotics, asphalt emulsifier, cleaning products, cleansing agents, dust control agents, hair care products,

paper coating, pesticides, stabilizing agents and varnishes.

Wind Power: The company has forayed into Infrastructure & Energy and has planned a 6 MW Wind Power Generation

project at Dewas (M.P.). Phase I of 2.4 MW was commissioned in March 2007 and is being used captively. The wind

power generated in Phase II will be first put to captive use and the balance power, if any, will be sold.

Biodiesel: The company also plans to venture into bio-diesel, which will be produced from the bye-products of edible

oils, other derivatives and origins of plant oils. The bio-diesel so produced shall be utilised captively and the surplus, if

any, will be sold.

Performance: The company notched up an impressive performance in FY08. On net sales income of Rs.938.60 cr., it

clocked a net profit of Rs.54.31 cr. netting an EPS of Rs.6.21.

Financial Highlights:

(Rs. in lakhs)

Latest Results: The company posted a net

sales income of Rs.274.34 cr. with net profit

of Rs.20.81 cr. registering a basic EPS of

Rs.2.39. The annualised EPS works out to

Rs.9.56.

Financials: SAOL has an equity base of

Rs.8.70 cr. and with reserves of Rs.80.90 cr.,

the book value of the share works out to

Rs.8.72.

Share Profile: In FY07, the company had

split its fully paid-up equity share of face

value of Rs.5 each into a fully paid-up

equity share of face value of Rs.2 each. Its

share is listed on the BSE under the B

group. The share price touched a 52-week

high/low of Rs.111/29.50. At its current

market price of Rs.92, it has a market

capitalisation of Rs.800 cr.

Particulars

Q1FY09

Q1FY08

FY08

Net Sales/Income

27433.54

14897.44

93859.97

Other Income

26.78

2.04

260.67

Total Expenditure

a. Inc/Dec in Stock

-528.54

-722.42

-1757.14

b. Raw Material

22952.60

12564.58

79403.13

c. Staff Cost

56.64

11.73

152.18

d. Other Mfg Exp

770.03

529.94

2808.41

e. Other Expenditure

1230.98

1276.31

5699.80

Finance Charges

361.25

146.45

1126.15

Depreciation

132.12

57.11

250.94

Profit Before Tax

2485.24

1035.78

6437.17

Prov for taxation

Current

298.23

124.29

772.46

Deferred

105.64

41.68

234.06

Net Profit

2081.37

869.81

5430.65

Paid up equity

Share Capital

870.13

870.13

870.13

Preference share capital

200.00

200.00

200.00

Res Exc Rev Reserves

-

-

8089.89

EPS (not annualized)

2.39

0.99

6.21

Selection Criteria

Time Communications (India) Ltd, the publishers of MONEY TIMES and its directors are in no way connected with the share trading business.

Equity analysts, investment advisors, chartists market observers and other specialists who contribute to MONEY TIMES are individual free-lancers

who may or may not have a position in the scrips recommended.

— Editor

Dividends: The company has been paying dividends as shown below:

6

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Page 7

March 2008 - 20%, March 2007 – 0, March 2006 - 5%, March 2005 - 30%, March 2004 - 30%.

Shareholding Pattern: The promoter holding in the company is 70.04% while the balance 29.96% is held by non-corporate

promoters and the investing public.

Prospects: Soya Industry is an agro based industry. Soya beans are a major source of vegetable proteins and edible oils.

India is a leading producer of oilseeds and this sector occupies an important position in the Indian economy.

India is a leading producer of oilseeds, which contribute a lot to the national income of the country. India has price

advantage in soya bean as compared to the American and the Brazilian soya bean, which cost around US $275-300 per

metric tonne, while the Indian soya meal costs around US $260-270 per metric tonne. No other country produces cheaper

soya meal than India, which contains high protein of around 48%.

Currently, soya bean is the most popular oilseed after groundnut and is also the largest produced oil meal in the country.

The prominence of soya bean is increasing due to its numerous advantages. It is considered as a premium product

because of its high digestibility, high energy content and consistency. Soya and its derivative products are valued more in

terms of human consumption and provide higher margins to the farmers in India.

The Soya Industry scenario is bright as India is one of the major exporters of soyameal to Vietnam, Japan, South Korea,

Thailand, Philippines and Indonesia. It typically exports around 65% of the country's soya meal production. Soya meal

accounted for 84% of the total edible oilseed meal exports from the country. The consumption of soya refined oil has

increased and the demand for soya meal is growing and about 98% of soya meal is used as an animal feed ingredient with

the remainder used in human foods such as bakery ingredients and meat substitutes. On crushing soya beans and solvent

extraction yield soya oil at 18% recovery and soya meal.

In addition, various consumer products like meal maker, soya milk, tofu, nuggets, flour and extruded proteins are made

from soya beans. The soya bean oil-based industrial solvents can be used to remove tar, grease, oil, adhesives, asphalt and

oil-based paints from equipments and tools. Soya bean oil based products are also used to spray the insides of asphalt

trucks to prevent sticking. Earth-friendly, soya release is biodegradable, less flammable and non-toxic unlike petroleum-

based lubricants, which are harmful for the environment and plant workers. Soya release is also less expensive to use.

Conclusion: SAOL is a profit-making and dividend-paying company with a good track record. It is an agro based solvent

extraction and refining company and one of India's leading soya bean processors and refined soya bean oil makers.

At its current market price of Rs.92, the SAOL share is discounted around 15 times its FY08 earnings. Considering its

excellent working and bright prospects going ahead, the share may be added to one's portfolio on declines with a

medium-to-long-term investment horizon.

Uncertainty and poor sentiment to prevail

MARKET REVIEW

By Ashok D. Singh

The indices suffered a severe setback on account of weak markets across the globe. The BSE Sensex lost 940.14 points or

6.69% to settle at 13,102.18 for the week ended Friday, 26 September 2008. The Nifty shed 260 points or 6.12% at 3985.25

for the week. Sustained selling by FIIs and the impasse over the proposed $700 billion bailout deal for the US financial

sector weighed on the market sentiment. The market posted losses in four out of five trading sessions during the week.

The NSE Nifty fell below the psychological 4,000 level yet again. Among index pivotals, Ranbaxy Laboratories and

Hindalco Industries hit 52-week lows on BSE.

The BSE Sensex is down 7184.84 points or 35.41% in the calendar year 2008 so far from its close of 20,286.99 on 31

December 2007. It is 8104.59 points or 38.21% below its all-time high of 21,206.77 struck on 10 January 2008.

A financial crisis engulfed the global markets earlier this month with the US investment banking giant Lehman Brothers

filing for bankruptcy, Merrill Lynch being bought over by the Bank of America and the US Government bailout of

American Insurance Group (AIG) for $85 billion in return for 80% stake.

The US Congress on Thursday, 25 September 2008 struggled to hammer out an agreement for modifying the Bush

proposal to attack the housing market crisis. On 19 September 2008, the Bush administration had proposed a $700 billion

financial rescue package aimed at staving off the collapse of the US financial system. Meanwhile, a group of conservative

Republican lawmakers proposed an alternative mortgage insurance plan.

FIIs have been consistently pressing sales to pull out their investments from India and other emerging markets in an

attempt shore up resources to beat the global liquidity crunch. In India, FIIs sold shares worth a net Rs.8,061 cr. (till 25

September 2008). FII outflows reached Rs.36,574.90 cr. in calendar 2008.

Inflation remained steady, the latest data showed. Inflation based on the wholesale price index rose 12.14% in 12 months

to 13 September 2008, unchanged from the previous week's annual rise, government data released after trading hours on

Thursday, 25 September 2008, showed. Inflation for the week ended 19 July 2008 was revised upwards to 12.54% from

11.98%.

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Page 8

On 22 September 2008, the Indian government eased overseas borrowing rules for infrastructure companies, increasing

the ceiling amount they can bring in to $500 million from $100 million.

On Thursday, 25 September 2008, JPMorgan Chase acquired the banking assets of Washington Mutual after the troubled

thrift company was seized by federal regulators marking the biggest bank failure in the US.

The BSE Mid-Cap index lost 287.96 points or 5.50% to 4,940.82 for the week ended Friday, 26 September 2008. The BSE

Small-Cap index slipped 354.21 points or 5.69% to 5,861.78 in the same week.

Trading for the week started on a subdued note as rise in crude oil prices weighed on the market sentiments on Monday,

22 September 2008. The Sensex fell 47.36 points or 0.34% to 13,994.96 and the Nifty fell 22.20 points or 0.52% to 4223.05 on

that day.

Key benchmark indices suffered sharp losses on Tuesday, 23 September 2008, mirroring a fall in global stocks on

uncertainty about the potency of the US Government's $700 billion bank bailout. The Sensex was down 424.65 points or

3.03% to 13,570.31 and the Nifty fell 96.15 points or 2.28% to 4,126.90 on that day.

Domestic bourses saw a relief rally on Wednesday, 24 September 2008, posting decent gains to snap the two days of

losses. The Sensex rose 122.21 points or 0.9% to 13,692.52 and the Nifty gained 34.35 points or 0.83% to 4,161.25 on that

day.

On Thursday, 25 September 2008, key benchmark indices ended the volatile session in the red. The Sensex shed 145.34

points or 1.06% to 13,547.18 and the Nifty was down 50.70 points or 1.22% to 4110.55 on that day.

The indices tumbled on Friday, 26 September 2008, as Washington Mutual's failure and uncertainty over the fate of the

US Government's $700 billion rescue plan for the financial sector haunted investor sentiment. First-time jobless claims in

the US rose to the highest in seven years pointing to a slowdown. The Sensex lost 445 points or 3.28% to 13,102.18 and the

Nifty fell 125.30 points or 3.05% to 3,985.25 on that day.

Banking shares were hard hit on fears that local banks may reportedly suffer losses on their exposure to the US financial

giants that had collapsed recently. ICICI Bank (down 10.64% at Rs.561.25), HDFC Bank (down 4.12% at Rs.1245.70), and

State Bank of India (down 8.33% at Rs.1434.20) dipped.

Real estate heavyweights were not spared either. India's largest real estate developer in terms of market capitalization,

DLF, lost 13.45% to Rs.369.50. Unitech, the country's second largest real estate developer in terms of market capitalisation

fell 30.59% to Rs.111.05, after sliding to a 52-week low of Rs.109.10 on 26 September 2008.

Software firms also fell on lingering concerns about the economic prospects of the US, their biggest export market. Satyam

Computer (down 13.01% to Rs.321.95), Infosys Technologies (down 10.85% to Rs.1447.10), Wipro (down 17.54% to

Rs.343.75) slipped. India's largest software exporter by sales, TCS, lost 11.69% at Rs.676.45 after hitting a 52-week low of

Rs.666.20 on 26 September 2008.

Reliance Industries Ltd. (RIL) lost 4.43% at Rs.1960.90. It began production of crude oil at KG-D6 block of the Krishna

Godavari basin on 17 September 2008, the company said on 22 September 2008. RIL holds 90% participating interest in the

block while the balance is being held by Niko Resources.

ONGC dropped 3.45% to Rs.1035.10. As per reports, ONGC Videsh, the overseas investment arm of ONGC, may take a $1

billion short-term loan to partly fund the $2.8 billion acquisition of London Stock Exchange-listed Imperial Energy.

Sterlite Industries fell 4.36% to Rs.447.20. The company's parent Vedanta Resources dropped a restructuring plan. As per

a restructuring plan proposed earlier, the Vedanta group was to create three units focused on commodities: copper, zinc

and lead; aluminium and energy; and iron ore.

Ranbaxy Laboratories tumbled 23.67% at Rs.272.40 on reports the Canadian drug regulator, Health Canada, issued a

notice to Ranbaxy saying it will be

particularly cautious about drug marketing

applications from Ranbaxy after the US drug

regulator blocked the sale of more than 30

generic medicines made in two factories by

the company. The stock hit a 52-week low of

Rs.269.05 on 26 September 2008.

8

Hindalco Industries slipped 12.19% at 99.10

after hitting a 52-week low of Rs.98.50 on 26

September 2008. The company's Rs.5,050 cr.

rights share offering for subscription Monday,

22 September 2008. The sale in a ratio of three

shares for every seven held at Rs.96 a share

will close on 10 October 2008. The company

aims to use the funds to repay a bridge loan it

had taken to buy Canada's Novelis in 2007.

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The Sensex lost 940.14 points to close at 13,102.18 last week. The market sentiment may continue to be influenced by

movements in global indices. Q2FY09 results are the next major trigger for the markets. IT giant Infosys Technologies will

kickstart the earnings season when it unveils its Q2 September 2008 results on 10 October 2008. Analysts opine that with

the dollar appreciating sharply against other currencies, including the Euro and the British Pound, most IT pivotal may

miss their dollar revenue guidelines. Foreign brokerage CLSA said in its recent research note to clients that Infosys may

not be able to meet its dollar guidance for the second quarter and the full fiscal.

9

Market faces liquidity crisis

MARKET

Hindalco stock falls as forecasted

By G. S. Roongta

The ongoing crisis in the global financial markets shows no signs of abating and each day brings about some bad news or

the other indicating that the crisis is far deeper than imagined. This has led to some panic reactions, which is evident by

the fact that short selling was temporarily suspended in the US markets and EU markets. In such a scenario, it is not

surprising that no big player or set of players are able to make a confident move in the equity markets

and many expect a further downturn in coming days.

The US $700 billion bail out plan for the financial system by the US Government is also being questioned

by the opposition and it is justly worried how to get it passed in the US Senate at the earliest. As a result,

there is little hope at this juncture for a revival in global markets, which will necessarily impact Indian

bourses that have witnessed a downward journey last week.

Market experts and technical analysts are also perplexed at the sharp volatility and the lack of confidence

in equity markets even after everyone agrees that Indian markets are relatively safe in relation to the

western markets. Understandably, most experts on the TV channels have taken a very cautious view and some do not

rule out the BSE Sensex sliding to 12000 or 10000 mark or even lower. The not so pessimistic ones talk about the CNX

Nifty touching 4300 or 4500 level in a medium-term rally. This song is being repeated day in and day out with the result

that it has become boring and fails to make an impact.

G.S. Roongta

Actually, the trend in the market is totally disturbed and investors are totally confused by a sharp rise of 700 points one

day, as witnessed on Friday, 19 September 2008, and followed by a larger fall last week. Such erratic movements of 1000

to 1500 points on the Sensex have been seen week after week for the past 3 months. And if we look at the stock prices, we

find that they are moving in a narrow range compared to a larger range over the last 2/3 months. Hence, if the market is

within the range of the last 2/3 months, why should one panic by day to day news.

Throughout last week there wasn't any good news for the markets to breathe a sigh of relief. Let us review some of the

major events affecting the equity markets last week:

(a) Vendant Group drops its restructuring plans in the face of opposition by investors.

(b) Dabur fails to conduct its AGM on protest by investors and a court order.

(c) Ranbaxy faces heat from export markets and its share price drops by 11% to Rs.308 on Tuesday, 23 September

2008.

(d) The US financial crisis is far deeper

than imagined as evident by the huge

rescue packages.

(e) Hindalco's share price rapidly drifts

to the rights offer price of Rs.96,

which opened on Monday, 22

September 2008.

The Aditya Birla Group may be happy to see

the Hindalco share break its 2-year low as it

will enable them to apply for more shares to

enhance their equity stake. Common investors

may now choose to buy the share from the

open market rather than apply for rights,

which is available against full payment of a

premium of Rs.95 for a Re.1 paid-up share.

The company's management has, of course,

got the issue underwritten 40% as a matter of

precaution. But while the promoters may

subscribe to 50% of the issue, it also opens the

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doors for a corporate raider who can corner the stock at this throwaway price. Thus while the issue may close, it is a sad

reflection on the capital market image of the flagship company of one of India's largest industrial groups.

All Aditya Birla Group shares are losing investor fancy as we have been highlighting for the last 3 weeks. This is evident

by the following:

(1) Grasim Industries has scaled down to a 52-week low of Rs.1625 in July 2008, from its peak of Rs.4074 losing over

60% in just 9 months and currently trades at Rs.1817.

(2) Aditya Birla Nuvo has scaled down to a 52-week low of Rs.975 on 18 September 2008 from its peak of Rs.2502

losing 61% in just 9 months and currently trades at Rs.1004.

(3) Hindalco has lost 55.6% as it is currently trading at Rs.99 against its 52-week high of Rs.223 (as per BSE) and is the

worst hit consider its peak price of Rs.250 over a year back.

(4) Idea Cellular hit a low of Rs.70 on 18 September 2008 falling below its issue price of Rs.75 and by 56% from its 52-

week high of Rs.161. This is despite the company recording a huge PBIDT of Rs.2269 cr. in FY08 and Rs.1486 cr. in

FY07 but it skipped the dividend.

The Aditya Birla Group management should review and re-rate their companies in the face of their bold claim of

enhancing shareholder value. We fail to understand how the shareholder value stands enhanced. Is it by the share price

or from the book-keeping point of view?

If the Aditya Birla Group companies seek to raise further funds from shareholders in quick succession like Hindalco

without rewarding them properly, who will like to stay invested especially at a time when there are better investment

opportunities in the market. The days of the Sixties, Seventies or even the Eighties are over when they commanded

investor fancy.

In comparison, take the example of Elecon Engineering, which recorded excellent profits like Hindalco or Grasim over the

last 3 years, but has cared to reward shareholders with 2:1 bonus and enhanced dividend distribution on increased

capital. Although it is very small compared to Hindalco or Grasim but it enjoys good capital market image and

commands the confidence of investors. Why should investors not switchover to such stocks rather than stick to an

unrewarding stock despite all its media hype and bold claims, which amount to nothing when it comes to the investors'

pockets.

In contrast, you can see the attitude of the Tatas when they reduced the quantum of issue to shareholders of Tata Motors

after its share prices fell down drastically after the ongoing Singur imbroglio and the crisis in the financial markets. Under

such market conditions, the management is not rigid like Hindalco to seek a hefty premium and full money on

subscription. This will obviously generate goodwill with investors and which is why the Tata Group is always considered

investor friendly.

Even PSUs like BHEL or independent professionally managed companies like L&T are perceived to be more investor

friendly as they have rewarded shareholders with a liberal 1:1 bonus in the recent past. In fact, L&T made two 1:1 bonus

issues in quick succession as against Hindalco made two rights issues at hefty premium even though its financial strength

and reserves were far greater than L&T!

What is the point if Hindalco's reserves keep on ballooning year after year without benefiting the shareholders? It has no

meaning and shareholders will naturally prefer to switch over from Hindalco or Grasim to L&T, BHEL, Tata Group

companies or Elecon Engineering.

By the above illustrations, I have sketched out the approach of managements, which record growths in the companies but

care to reward shareholders, who are the principal stakeholders in the company, as compared to the Aditya Birla Group,

which chooses to neglect shareholders and just milks them dry. History has proved that companies that share their

growth with shareholders always fetch better valuations in the long run. Is this not evident in the case of Hindalco or

Grasim as their share prices languish despite their better fundamentals.

This is a reflection the attitude of promoters who demand more from shareholders rather than reward them. Look at the

spate of IPOs over the last 2 years as almost all of them are quoting below the issue price. This clearly indicates the greed

of the promoters who lure investors at the time of the offers and dump them after pocketing the unjustified premium.

Quite unlike the past when IPOs were made at a fraction of the book value, today's IPOs are made at a multiple of book

value and promoters take full advantage of the market mechanism and loot the unsuspecting investing public. Thus

instead of being the trustees and custodians of the funds of common shareholders, they have turned swindlers and do so

openly playing within the ambit of law.

Investors must, therefore, be very selective and switchover to companies whose promoters are genuinely investor friendly

if they really want to reap investment rewards.

By Saarthi

STOCK WATCH

W S Industries (India) Ltd. (Code: 504220) (Rs.45.80) is a leading manufacturer of high voltage electro-porcelain

transmission insulators and sub-station insulators. It deals in other products such as well like dropout fuses, isolators,

10

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Page 11

lightning arresters, coupling capacitors, capacity voltage transformers, instrument transformers, line traps and

reactors. To cater to the rising demand, the company is setting up a greenfield plant in Visakhapatnam to double the

manufacturing capacity of substation insulators to 16,000 tonnes. The project is almost complete and is expected to

commence shortly. Besides, its transmission insulator unit with installed capacity of 8,000 tonnes is running at full

capacity. Lately, the company has also ventured into turnkey projects for designing, execution and construction work of

transmission lines of below 220 KV. Meanwhile, its subsidiary company has completed the construction of the 1st phase

(300,000 sq. ft.) of the Software Technology Park in association with TCG group. Hence from the current year it will start

generating additional lease rental of approx Rs.3 cr. With an order book of nearly Rs.135 cr., the company is expected to

post a turnover of Rs.275 cr. with profit of Rs.16.50 cr. i.e. an EPS of Rs.8 for FY09. A good bet in the power ancillary

space.

******

Tantia Constructions Ltd. (Code: 532738) (Rs.58.35) has a presence in roads and highways, railways, tunnels, bridges and

flyovers, urban infrastructure, sewage & drainage, civil & housing construction etc. Lately, it has also ventured into the

lucrative marine infrastructure space, power transmission & distribution infrastructure and aviation infrastructure. In

fact, it is among the five Indian companies capable of providing 'foundation-to-finish' for mega railway bridges spanning

2-km or more. Importantly, the company has a very strong presence in the eastern and north-eastern regions, which give

it a distinct edge since very few players are interested in bidding for prospects in these regions due to the difficult terrain.

Presently, it has diversified and massive order-in-hand position of more than Rs.1000 cr. to be executed in the next 24

months. In the near future, the company intends to foray into BOT & BOOT projects to boost up its margin. For Q1FY09, it

recorded a 40% rise in the topline as well as bottomline to Rs.99 cr. and Rs.5 cr. respectively. Hence for entire FY09, it may

clock a turnover of more than Rs.450 cr. with profit of Rs.20 cr. i.e. an EPS of Rs.12 on its diluted equity of Rs.16.30 cr. A

relatively safer bet in the infrastructure space.

******

Austin Engineering Ltd. (Code: 522005) (Rs.59.60) is the leading manufacturers of all types of antifriction bearings

namely ball, tapered roller, spherical roller, needle roller and thrust bearings. Despite its small size, it offers the widest

range of bearings from 50 gms to over half a tonne. In fact, it is among a handful of customised bearing manufacturers

worldwide to produce bearings with 1200 mm diameter. It supplies bearings to different category of buyers like

automobiles, defence, state road transport corporations, steel plants, thermal plants, cement plants, sugar and paper

industries, fan and pump industries and material handling equipments. For FY08, it registered 10% growth in sales to

Rs.73 cr. and 20% increase in net profit to Rs.6.50 cr. recording an EPS of Rs.18. Incidentally, the company derives 40%

revenue from exports to most quality conscious markets like USA & European countries. It has even set up 100%

subsidiaries in USA and Italy, which act as its marketing front-end. In the near future, the company intends to venture

into manufacturing of geared slewing rim bearings for heavy earth moving and construction equipment and special

bearings for aerospace applications. For FY09, it may report sales of Rs.75 cr. with profit of Rs.5.50 cr. i.e. an EPS of Rs.16

on its small equity of Rs.3.50 cr.

******

Cera Sanitaryware Ltd. (Code: 532443) (Rs.117.85) is the third largest company in the organized sanitaryware segment

with over 20% market share in the domestic market. Notably, in the last couple of years, the company has evolved itself

into a total bathroom solutions provider with a wide range of products including WCs, wash basins, whirlpools, bath

tubs, shower panels, shower cubicles, shower temples, bath fittings, kitchen sinks, tiles etc. In line with today's high

technology, it also provides automatic electronic flushing system, automatic water flow sensor tap, automatic hand

dryers/soap dispensers, perfume sprayer etc. It even has a strategic tie-up with Pozzi-Ginori, an Italian designer

sanitaryware, for importing premium sanitaryware and marketing it in India. To cater to the high demand, it has recently

expanded its production capacity from 16,500 MTPA to 24,000 MTPA. To boost its retail sales, it came up with novel idea

of setting up live CERA bath studio where consumers, architects, interior designers etc can actually see how the premium

products will look, feel and function in their homes. It has already set up eight such studios across India and is now

putting up Cera Bath Galleries with its retail partners. Further, the company is planning a major foray into taps as there is

only one strong Indian brand, followed by mediocre brands. For FY09, it may register sales of Rs.160 cr. with PAT of Rs.11

cr. i.e. an EPS of Rs.18 on its current equity. Worth taking a look at.

By Kukku

FIFTY FIFTY

* Sugar stocks: Every 1000 kgs of cane crushed give 100 kg of sugar at a recovery rate of 10%, 40 kgs of molasses, which is

converted in to 10 ltrs of alcohol, 300 kgs of baggase, which is converted into 100 units of steam/power generation, plus

300 kgs of mud, which is converted in 30 kgs of bio-fertilizer. Since prices of molasses/alcohol have shot up sharply in the

last one year and taking into account the sugar cost at around Rs.17 per kg., power Rs.5 per unit of overall realisation

(including income from alcohol & power) the realization comes between Rs.22 to Rs.27 per kg of sugar produced

11

---

Page 12

depending on the recovery rate and the power & alcohol rates on a state to state basis. Most of the big sugar plants are

well integrated and will benefit from the upswing in the sugar price cycle. Investors are advised to accumulate good

sugar stocks like Renuka Sugar, Sakthi Sugar, Andhra Sugar, Oudh Sugar, Kesar Enterprises, Bannari Aman for good

long-term growth.

Risk Factors: Being a commodity stock, the upmove will depend on the price of sugar. Except Bannari Aman, most

companies have high debts and thus their interest costs will be high.

* W S Industries (Rs.45.80) order book presently stands at Rs.138 cr. With the thrust given to the power sector in the 11

th

Five Year Plan as well as the global interest in construction, rehabilitation and upgradation of electricity networks, the

ongoing demand for its products continues to remain strong both in the domestic and export markets.

Construction of its new production facility at Visakhapatnam for the manufacture of Sub-station Insulators is nearly

complete and commercial production is expected to commence shortly.

Phase I of the construction of its 3 lakh sq. ft. Software Technology Park, promoted by its subsidiary, W S Electric Ltd., in

association with TCG Group, is almost complete and is being leased out. The construction work for Phase II has

commenced.

The company will benefit from exports due to the firm US dollar.

Investors are advised to stay invested in this stock or add on dips. Its book value is Rs.38 while the stock is available at

almost its 52-week low. Its 52-week high is Rs.140. Thus the downside is limited in this investment.

* Gujarat Apollo Industries (Rs.155) manufactures and designs various road construction equipments. This includes

manufacturing asphalt plants, sensor paver finishers, bitumen pressure distributors and kerb pavers, indirect heating

equipment, asphalt batch mix and drum mix plants. The prospects of its user industries are encouraging.

The company does not foresee any slowdown in demand as the projects in the pipeline are from the roads sector to which

it caters to. There are strong orders from both NHAI and the State highways. However, the BOT road projects are faced

with escalation costs of borrowing and rise in prices of construction materials making a mockery of the initially planned

payback periods.

Its consolidated sales for the June 2008

quarter were Rs.61.30 cr. and the

operating profit was Rs.10.94 cr. The net

profit after minority interest is Rs.7.14

cr. Full year FY09 consolidated EPS is

likely to be around Rs.30 or even more.

Investors can accumulate this stock for

good long-term growth.

12

* Jetking (Rs.221.60) is now trading ex-

bonus at a P/E ratio of just 11/12

compared to industry average of

around 55. The stock has given strong

growth to long-term investors. Stay

invested or accumulate on dips. It is one

of the safe investment bets as the

dividend declared for last year was

160%. Thus the dividend yield itself is

good.

* STG Technology (Rs.13.80) is doing

well in the last few quarters. While its

yearly high is Rs.44, the stock is

available at a low of Rs.14/15 against a

book value of around Rs.19 and

promoters' stake of 61%. Investors with

long-term view can accumulate on dips.

*

Gontermann

Peipers

(Rs.37),

incorporated in 1966, manufactures iron

& steel base rolls with an initial capacity

of 3000 TPA in technical and financial

collaboration with Gontermann Peipers,

Siegen, West Germany.

The implementation of the ongoing

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Page 13

modernisation/expansion project envisaging enhancement of the plant capacity from 15,300 MTA to 18,300 MTA is

expected to be completed by Q3FY09. The company expects to derive the full benefit of the expansion by Q2FY10.

On the export front, too, prospects appear promising. Its order book is healthy and various long-term supplies are in

place. Further, the high cost of production of European, American & Japanese roll makers offer a good opportunity for

Indian rolls in the export market, especially in South East Asia, China, Middle East, Africa, East Europe & USA. Export of

forged rolls was 565 MT compared to 381 MT in the previous year registering a growth of 48.29%. With the continued

thrust on exports, the company expects to increase the export share to total sales in FY09. Firmness of the US dollar will

improve its margins.

With the expected benefit of expansion, the company can safely achieve an EPS of around Rs.9/10 in the current year,

which may go up to Rs.13/14 by next year.

With a book value of around Rs.44, dividend of 15%, 52-week high/low Rs.140/34, the stock looks safe for investment

around Rs.37 levels or on dips.

* Yuken India (Rs.113.70) - There is a slowdown in the user industry like the machine tools industry and its margins are

likely to be affected in the current year.

Note: Although we have recommended the above stocks for buying but looking at the current market sentiment,

investors are advised to keep a watch on these stocks for buying only at lower levels. We may see a correction in real

estate property market which may lead to some defaults. Investors are advised to avoid all high priced stocks that have

given multifold returns in the last few years and/or where the promoters are unknown or do not have a proven track

record.

Avoid private equity/broking firm/financial sector stocks for the time being.

Sugar and Tea sectors are likely to do well in the medium-term.

Construction equipments manufacturers may not report encouraging results due to slowdown in the sector and high

borrowing costs. Avoid this sector.

Many companies that came out with unjustified high premium in the last few years may see a further downside as there

is no track record of the promoters to justify the premia.

Avoid all such stocks where promoters holding coming down in the last few years in the rising market. We have seen

how Prajay Engineers Syndicate has fallen.

Be careful in high priced stocks where there are high FII holdings.

We may see more realistic levels. Hence be extremely careful in buying.

By V. H. Dave

EXPERT EYE

Reliance Petroleum Ltd. (RPL) (Code: 532743) (Rs.147.50), incorporated on 24 October 2005 and promoted by Reliance

Industries Ltd. (RIL), is a subsidiary of RIL. It also benefits from the strategic alliance with Chevron India Holdings Pte.

Ltd., Singapore, a wholly-owned subsidiary of Chevron Corporation USA (Chevron). RPL entered the capital market with

an IPO of 135 cr. equity shares of Rs.10 each at a premium of Rs.50 per share in April 2006.

The company was set up with the objective of creating significant value by harnessing the emerging opportunities in the

global energy sector arising out of several years of under investment in refining capacity.

RPL has set up a 5,80,000 barrels per day (BPD) of crude oil per stream greenfield petroleum refinery and a 0.9 million

tonnes per annum polypropylene plant in a special economic zone (SEZ) at Jamnagar at a cost of Rs.27, 000 cr. The

refinery is located adjacent to the existing refinery and petrochemicals complex of RIL. The company will step up

production gradually from November 2008 to reach 85% capacity of 4,93,000 BPD. It is the world's sixth largest refinery

and commissioned earlier than expected.

In a landmark development in FY07, RIL and Chevron embarked on a strategic partnership in RPL with a view to

optimally leverage their mutual strengths and exchange best values. Through a well-executed global syndication, RPL

raised foreign currency loans of US $2 billion, making it the 'largest foreign currency financing for any single project in

India'.

RPL's equity capital is Rs.4500 cr. and with reserves of Rs.9000 cr., the book value of the share works out to Rs.30. RIL

holds 70.4% in its equity capital, Chevron holds 5%, foreign holding is 2%, mutual funds/institutions hold 4.9%, PCBs

hold 5% leaving 12.7% with the investing public.

The refinery was partially commissioned in September 2008 ahead of schedule and full production will be reached

gradually. The refinery can process heavy and sour crude and can produce value added products meeting the highest

quality specifications in the world.

Going by prospects, Asia and Middle East will be contributing 60-70% of the incremental demand. Europe appears to be

the most attractive export market for diesel, which is in high demand at the moment. The most important markets for

gasoline will be USA, Africa and the Middle East.

13

---

Page 14

14

Although RPL's exports to US are lower than the originally envisaged 30-40%, they should be significantly higher than

7% in FY08. This is because only 10% of RIL's product mix is gasoline against 30% originally planned.

However, RPL has better refining margins that RIL's margin of US $15/bbl. This could be higher due to more stringent

specifications than Indian buyers and the heavier grade crude processed implying lower feedstock cost.

During FY09, production will be gradually increased to reach 85% capacity of 5,80,000 BPD according to some analysts

tracking RPL.

Its full commissioning will beat the competition from other refineries being set up in West Asia and China as they are

delayed by the rising costs of steel and cement.

At the same time, the margins of refineries across the world have begun to fall as the difference between the prices of

petroleum products and crude oil is narrow and the demand for petroleum products is weak especially in USA and

Western Europe, the two largest consumers due to high fuel prices and slow economic growth. This slowdown in

demand may not spare RPL.

However, Mr. Mukesh Ambani, managing director of RPL, expects that the prospects for the refining sector to remain

encouraging because of the robust demand, tight product supplies and the slow growth of new capacities dogging an

already stretched refining system.

After full commissioning, Reliance's two Jamnagar units (one of RIL and one of RPL) will be the world's largest single-

location refining facility. The entire refinery complex will have a total processing capacity of 12,40,000 BPD.

The profits of RPL will depend mainly on two factors viz. global crude oil prices and fuel prices. As per an optimistic

view, RPL will have GRM (Gross Refining Margin) of over $14/15, the best it ever achieved last quarter.

Analysts expect RPL to achieve sales of Rs.13,000 cr. during FY09 with net profit of Rs.1,650 cr. and an EPS of Rs.3.66.

During FY10, sales would go up to Rs.65,000 cr. with net profit increasing to Rs.9,400 cr. and the EPS would be Rs.20.9.

The shares of RPL are traded at Rs.147, discounting its estimated FY10 EPS of Rs.20.9 by 7.2 times. One can buy the shares

at declines for long-term gains. The 52-week high/low of the share has been Rs.295/109.

******

The share of Sathavahana Ispat Ltd. (Code: 526093) (Rs.39.25) is recommended for decent gains in the long-term. Its

expansion will lift its earnings significantly in coming years.

Incorporated in 1989, SIL manufactures pig iron through the mini-blast furnace route with an installed capacity of

1,20,000 TPA. Since then, its capacity has been hiked to 2,10,000 TPA. It is spearheaded by Mr. K. Thanu Pillai as

Chairman and Mr. A. S. Rao as Executive Vice-Chairman. SIL operates in the Iron & Steel industry, which is considered as

core sector.

SIL's pig iron manufacturing capacity is 2,10,000 TPA and 3,00,000 TPA for metallurgical coke. Its coke plant commenced

commercial production in March 2007 and its 30 MW co-generation power plant in Bellary district of Karnataka was

commissioned on 31 July 2008. It is now enhancing its coke capacity to 4.5 lakh TPA and has signed a PPA (power

purchase agreement) worth Rs.3.25 cr.

During FY08, SIL posted 43% higher sales of Rs.358 cr. and earned 135% higher net profit of Rs.33 cr. the EPS was Rs.10.4

on its enlarged equity of Rs.31.8 cr. With reserves of Rs.121 cr., the book value of its share works out to Rs.48.

During Q1FY09, operating profit margin (OPM) has moved up to 30.5% from 17.8% and net profit margin (NPM) to 15.1%

from 4.6%. During FY08, OPM & NPM shot up to 23.3% and 9.2% from 14.6% and 5.6% respectively in FY07.

SIL issued 15.4% stake i.e. 49 lakh shares to Stemcor Holdings, a strategic investor, at a price of Rs.60 per share. Stemcor is

a $6 billion leading consultancy firm, which provides marketing, finance and logistic services to the steel industry. SIL

had also issued 6.25 lakh shares and 15.70 lakh warrants to the promoters at Rs.60 per share.

The funds raised are being utilised to meet the aforesaid coke capacity expansion and its 10 MW power plant. The total

capex for FY08 and FY09 is Rs.176 cr., which is expected to save SIL more than Rs.20 cr. in FY10. Market sources maintain

that the company would soon be allotted iron ore mines in Karnataka.

Pig Iron is the basic raw material used by the Engineering, Construction, Foundry and Capital Goods industries. With

significant growth in the main user industries like Automobiles, Construction, Foundries the demand for Iron & Steel has

increased considerably.

Metallurgical coke is the key input for iron making and given its own production of metallurgical coke, SIL has integrated

itself backward for this key input material. The surplus coke is sold in the market.

As SIL's pig iron enjoys brand value and it is one of the low cost producers of pig iron, there is an opportunity for

increasing the market share. The simultaneous modernisation of its plant will enhance efficiency, reduce process costs

and increase volumes.

There was robust growth in the global demand for Iron & Steel driven mainly by the Chinese appetite for steel for the

Olympics followed by USA and the European Union's demand push by virtue of the resurgence in their economies.

Given the capacity expansions nationwide, India is expected to become the second largest steel producer after China by

2015-16 from the fifth largest steel producer with a steel production of 55.27 million tonnes. Indian steel consumption also

---

Page 15

grew from 52.26 million tonnes in the last year to 57.13 million tonnes in FY08 recording an impressive growth of 9.2%.

This augurs well for the prospects of pig iron manufacturers.

With its enhanced pig iron and coke capacity using the latest technologies together with the cogeneration of power at the

greenfield site, SIL can take full advantage of the current uptrend in the Iron & Steel industry.

For FY09, SIL is expected to clock a turnover of Rs.470 cr. up 33% from Rs.358 cr. in FY08 and a net profit of Rs.75 cr. The

EPS would work out to Rs.23.6.

At the CMP of Rs.39, the share is trading at a P/E of 1.8 on FY09E earnings. The share is recommended with a medium-

term target of Rs.60. The 52-week/low of the share has been Rs.111/38.

******

Twilight Litaka Pharma Ltd. (TLPL) (Code: 506985) (Rs.56.45) has been reporting good results over the last several

quarters and is all set to garner an EPS of Rs.13 on its FV of Rs.5 per share.

Incorporated as a private limited company in January 1974, Li Taka Pharmaceuticals was converted into a public limited

company in December 1985 and Li Taka Laboratories Pvt. Ltd. was amalgamated with it in 1986. The company came out

with a rights issue in April 1992 to meet its long-term working capital requirements and to part-finance its capital

expenditure including modernisation. The name of the company was changed from Li Taka Pharmaceuticals to the

present one with effect from 4 July 2006.

The company manufactures various drugs and pharmaceutical formulations at its manufacturing facilityies located at

Pimpri, Pune and Vasai in Maharashtra. In 2007-08, TLPL inaugurated its new factory at Baddi in Himachal Pradesh.

The company's products cover Analgesics, Anti Inflammatory, Anti-Asthmatic, Antibiotics, Anti-bacterial, Vitamins,

Haematinics and Cardiovascular drugs.

TLPL exports its products to over 30 countries across Africa, South America, South East and Central Asia.

In addition to the above, TLPL utilises its facilities for contract manufacturing on a loan license basis for several large

companies like Novartis, Wockhardt, Cipla, Pfizer, Lupin and Serum.

TLPL has a well-equipped, modern

manufacturing, testing and packaging

facilities at all its plants viz. Pimpri,

Vadgaon and Vasai. The Pimpri Plant has

been approved by the Department of

Science & Technology, Government of

India, for its R&D facilities. The plants at

Vadgaon and Pimpri are approved by the

Pune University for laboratory use by its

students pursuing the doctorate degrees.

15

Its facilities at Pimpri and Vadgaon are as

per the World Health Organisation (WHO)

guidelines and in conformity with Good

Manufacturing Practices (GMP) enabling

TLPL to register its products for export to

several countries.

TLPL also

has a well-established

distribution network all over India, except

in Delhi and Uttaranchal, with a customer

base of over 1,00,000 doctors for 120

formulations distributed through 1000

stockists. Its domestic marketing personnel

comprises a field force over 600 and it is

registered with various Central and State

agencies to cater to the requirements of

large hospitals, railways, ESIC, Post and

Telegraph Department, city contractors,

autonomous bodies and the armed forces.

October – December 2007

EBG Quarterly Performance:

100% once again

During October – December 2007, which is the first quarter of the fifth

year of 'Early Bird Gains' (EBG) – the investment newsletter that spots

multi-baggers, it has scored 100% success with all 15 recommendations

recording an appreciation.

EBG has, therefore, consistently, maintained quality while the bonus

issues in excess of 30% highlight the confidence of its recommendations.

Issue

Dated

Scrip

Buy

Price

Highest

price since

recom.

Growth

%

Tyche Peripherals Sys.

64.15

116.4

03/10/07

81

10/10/07

Hilton Metal Forging Ltd.

35.00

The business mix also includes an exclusive

marketing arrangement with Cipla for

marketing its brands across 10 states in the

country.

During FY08, TLPL posted 49% increased

72.5

107

17/10/07

Hind Aluminium Inds.

60.10

102

70

24/10/07

62.25

114

Kamdhenu Ispat Ltd.

29.00

31/10/07

CHD Developers Ltd.

18.30

37.4

104

G M Breweries Ltd.

99.00

160

31/10/07

62

07/11/07

Asian Granito India Ltd.

94.00

135

44

14/11/07

Mudra Lifestyle Ltd.

78.85

114.9

45

21/11/07

115.65

43

Lumax Auto Technologies

80.75

36.95

73.9

100

28/11/07

Vybra Automet Ltd.

05/12/07

Avantel Softech Ltd.

96.85

138.5

43

12/12/07

Micro Forge (India) Ltd.

26.65

36.9

38

19/12/07

Mayur Uniquoters Ltd.

57.45

74

30

26/12/07

Arvind Remedies Ltd.

4.35

6.68

54

26/12/07

Relaxo Footwear Ltd.

68.75

88.65

29

EBG for sure profits

---

Page 16

sales of Rs.295 cr. and earned 41% higher net profit of Rs.20 cr. The EPS was Rs.9.2 on the face value of Rs.5 per share.

During Q1FY09, profit has gone up by 41% to Rs.6.5 cr. on 35% higher sales of Rs.84 cr.

TLPL's equity capital is Rs.10.6 cr. and with reserves of Rs.34 cr., the book value of its share works out to Rs.21. The value

of its gross block is Rs.52 cr. The promoters hold 63.7% in the equity, foreign holding is 1.6%, PCB holding is 3% leaving

31.7% with the investing public.

In FY08, TLPL's growth in the domestic formulation business was around 55% on the back of new product launches and

intensive marketing. This division accounts for more than 50% of its sales and profits. Another major sales contribution

came from contract manufacturing of pharmaceuticals and neutraceuticals for companies like Novartis, Wockhardt,

Serum Institute, Herbalife, Artlife and Elken.

TLPL is fetching more and more orders for CRAMs for both neutraceuticals and pharmaceuticals, which will boost the

capacity utilisation of its Baddi unit in the current year. Apart from CRAMs, TLPL earns a small revenue from

loan/license based manufacturing for companies like Pfizer, Lupin and Cipla.

TLPL recently inaugurated its new factory at Baddi in Himachal Pradesh. This plant is likely to increase its production

capacity by 35%. It already has three plants engaged in the manufacture of dietary food supplements and

pharmaceuticals. In FY08, the utilisation level of its new facilities was low at 35-40%, which can go up to 75-80% in FY09.

The company is expected to grow by over 50% in the coming years. Sales are expected to surge to Rs.425 cr. with higher

net profit of Rs.28 cr. yielding an EPS of Rs.13 on the face value of Rs.5 per share.

At the current market price of Rs.56, the TLPL share is trading at a forward P/E of just 4.2 against the industry average

P/E of 7.5. Investment in this share is likely to fetch a decent appreciation of 50% in the medium-to-long-term. The 52-

week high/low of the share has been Rs.108/35.

16

By Nayan Patel

TECHNO FUNDA

Swasti Vinayaka Gems Corporation Ltd.

BSE Code: 512257

Last Close: Rs.4.75

Swasti Vinayaka Gems Corporation Ltd. (SV Gems), a Podar Group company, manufactures statues valued from Rs.1

lakh to Rs.10 cr. It is also manufactures the latest fashionable diamond jewellery. The company has 3 showrooms in

Grand Hyatt Plaza, Mumbai and also participates in international auctions.

SV Gems has an equity of Rs.4 cr. The promoters hold 53.43%, corporate bodies hold 33.93% and the investing public

holds 12.64%.

In FY05 & FY06, the company issued bonus shares and has declared 1:3 bonus for the current year. It regularly pays 40%

dividend on the face value of Re.1 per share. At the current level, the stock is available dirt cheap. Buy at every decline

keeping a strict stop loss of Rs.3.50. On the upper side, the stock will zoom up to Rs.7.25 level in medium-term and will

cross Rs.10 mark in the next 12 months. Its 52-week high is Rs.8.97.

Twilight Litaka Pharma Ltd.

BSE Code: 506985

Last Close: Rs.56

Twilight Litaka Pharma Ltd. (TLPL) is a fast growing pharma company. It manufactures drugs and formulations in the

form of tablets, capsules, ointment and liquids for the following major therapeutic segments: Analgesics – Anti

Inflammatory, Anti-Asthmatic, Antibiotics, Anti-bacterials, Vitamins, Haematinics and Cardiovascular drugs.

The company exports its products to over 30 countries across Africa, South America, South East and Central Asia. In

addition to these activities, it utilises its facilities for contract manufacturing on a principal to principal or on Loan License

basis for several large companies like Novartis, Wockhardt, Cipla, Pfizer, Lupin and Serum. It has three manufacturing

plants in Pipari, Vadgao & Vasai.

It has an equity of just Rs.10.64 cr. in which promoter hold 63.74% while the investing public holds 31.70% stake. For the

June 2008 quarter, it posted marvellous numbers. Net sales jumped 34.68% to Rs.84.15 cr. while net profit jumped 41.43%

to Rs.6.52 cr. The company paid 20% dividend last year. Currently, the stock is available at a P/E ratio of just 6 and is

going dirt cheap. Investors can buy this stock at every decline for short-to-long-term investment. Stock will touch Rs.72 in

the short-term and can go up to Rs.110 level in next the 8-12 months. Its 52-week high is Rs.108.

Geojit & NSE workshops for managing currency risk

MONEY FOLIO

Geojit Financial Services, a leading retail financial services company in association with the National Stock Exchange of

India Ltd. (NSE) is conducting a series of workshops on managing Currency Risk across South India and Maharashtra.

The Currency Futures segment went live at NSE on the 29

th

of August 2008 and there is a need for participants to

understand the practical applicability of this new class of instrument.

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Page 17

To address this requirement, Geojit and NSE will be conducting workshops in the metros and other cities. The aim of

these workshops is to raise awareness amongst all participants on how they can practically manage their currency risk

and on how to take advantage of dollar-rupee fluctuations.

Apart from primary participants like exporters, importers, banks, corporates and commercial bodies, individual retail

investors will also be invited who receive remittances from abroad, want to fund their children's overseas education etc.

NSE experts will be making the presentations. Every workshop will conclude with an interactive session wherein

participants will be encouraged to clear

doubts.

17

Aviva Life launches IndiaBond

Aviva Life Insurance has launched

IndiaBond, a single premium, endowment

plan with guaranteed maturity benefits.

This plan offers a compounded return of 7%

per annum on maturity. For example, a

policyholder paying a single premium of Rs.1

lakh for a policy term of 10 years will get a total maturity benefit of Rs.1,96,715 plus life cover.

Live market intra-day calls

A running commentary of intra-day trading recommendations on

your mobile or Yahoo Messenger every trading day of the month

for Rs.3,000 per month.

For 1-day free trial call Money Times to register. Provide your

mobile number or Yahoo Id. Tel: 022-22616970, 22654805 or

Email: moneytimes@vsnl.com

This plan offers a compounded return of 7.00% p.a. Maturity benefits are absolutely

tax free under Section 10(10D) of the Income Tax Act, 1961. The premiums paid are eligible for a tax deduction as per

Section 80C of the Income Tax Act 1961. The minimum Single Premium is Rs.50,000 and there is no limit on the

maximum. There is the option of a 5 year or a 10 year policy term and Death Benefit is 5 times of the Single Premium in

the first year, 4 times of the Single Premium in the second year, 3 times of the Single Premium in the third year and 2

times of the Single Premium thereafter. At the end of the policy term, the proposer gets a guaranteed maturity amount

depending upon the policy term and the Single Premium amount. To be eligible for IndiaBond, one has to be between 15

and 45 years of age. The maximum maturity age is 55 years.

G S Auto plans major expansion

GS Auto International Ltd., manufacturer & exporter of components for commercial vehicles, has received an export

order worth Rs.1 cr. from various customers such as Arvin Meritor, Hermann Peter Gmbh and Sieg Fried Templing

Gmbh of Germany, Rotakrk Gears B.V. Holland and Mast Trading Company in Dubai. With these orders, the company

has total export orders in hand are Rs.3.85 cr. The company's exports will also benefit by the weak Rupee.

The company is also at an advanced stage of raising Rs.50 cr. through FCCBs, which would be used for setting up a unit

at Jamshedpur to cater to Tata Motor's commercial vehicle division and to expand its unit at Ludhiana.

ICICI Prudential Life launches LifeStage Assure

ICICI Prudential Life has launched LifeStage Assure, a unique triple advantage wealth creation product. This unit linked

insurance plan will provide upto 450 % of first year premium guarantee on maturity, to enable consumers to dabble in

equities without any risk of the downside.

The premium from second year onwards will be invested after deducting a very low premium allocation charge, ensuring

benefit from the upside of equity investment in the long term. The additional advantage of LifeStage Assure includes the

benefit of a lifecycle based portfolio strategy that allocates the investor's money across various asset classes based on his

life stage and risk appetite.

Other features of LifeStage Assure include the option of cover continuance, which ensures continuance of life insurance

cover, even in a case of break in premium payment. Further, LifeStage Assure allows the option of withdrawing money

systematically over a period of 5 years on maturity of the policy. In addition the premium paid for the policy will be

eligible for tax benefit under section 80C and any benefit amount received under this policy will be eligible for tax benefit

under section 10(10D), as per the Income Tax Act 1961.

Arvind's Megamart to retail Cherokee apparels

Arvind Ltd., India's largest integrated textile manufacturer and a leading branded apparel & retailer operating across the

entire value chain from design to fabric to brands, has launched the world's largest family lifestyle brand 'Cherokee' in

India.

Brands that Cherokee Inc. owns and represents generate over $4 billion in annual retails sales worldwide. The company's

principal focus is global 'retail direct' licensing. The company has partnered with several of the best known retailers in the

world including Target Stores, Tesco Plc, TJX Companies, Zellers (Hudson Bay Company) and Pick'n Pay among others

in providing consumers with well understood brands, making them available on an exclusive basis with these retailers.

Cherokee is one of the fastest growing family brands worldwide and will be exclusively available at Megamart.

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Page 18

Hettich to establish over 100 Certified Kitchen Studios

Hettich, the world leader in furniture fittings, has chalked out an ambitious expansion plan in India with a view to service

its customer better by establishing over 100 Hettich Certified Kitchen Studios across the country. It has selected kitchen

studios given the rapid growth of housing industry offering apartments furnished with modular kitchens.

Hettich India has been set up as a joint venture with the K. K. Birla/S.K. Poddar Group, which controls Zuari Agro and

Chambal Fertilizers Ltd.

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Disclaimer: Investment recommendations made in Money Times are for information purposes only and derived from sources

that are deemed to be reliable but their accuracy and completeness are not guaranteed. Money Times or the analyst/writer does

not accept any liability for the use of this column for the buying or selling of securities. Readers of this column who buy or sell

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acquaintances may/may not have positions in the above mentioned scrip.

18

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