Thursday, December 29, 2005
Tuesday, October 25, 2005
26-10-2005
Stocks to watch 26-10-2005
The market is trading lower amid losses in pharma, FMCG, banking, metal, capital goods, oil and technology stocks. The Sensex is down over 150 points.
Technical Analyst, E Mathew discusses Ranbaxy, ACC, Grasim, Tisco, BPCL and Satyam.
Excerpts from an interview with Technical Analyst E Mathew:
On Ranbaxy:
Ranbaxy is breaking its support levels with ferocity. It has broken its support level at Rs 370- Rs 375 zone. Initiate a long position in Ranbaxy if and only if this stock is now able to trade above the Rs 390-Rs 392 zone with convincing volumes, otherwise we don’t feel this stock has still bottomed out.
On ITC:
One can go for long in ITC at Rs 100-Rs 105 levels. But it remains to be seen if it will come down to these levels. Depending on one's risk profile, if one is prepared to see downside about Rs 100-Rs 105, one could initiate a long position in it.
On ACC:
The cement counters indeed have lost their momentum. ACC was quite disappointing and the way it collapsed possibly after that result was not very encouraging. However, ACC has strong support now at around Rs 435 -Rs 438 zone. So long as the stock trades about this zone, even now there is still hope for revival.
On Grasim:
The relative strength of Grasim’s chart is much better than that of ACC. Stock is looking good on declines. If one could get the stock somewhere between Rs 1050- Rs 1070, could be a good opportunity.
On Reliance Capital:
One can say the worst is over for Reliance Capital if the stock is able to stay convincingly over Rs 385 levels with good volumes. The big break out for it would be around Rs 410. Infact, between Rs 385 and Rs 410, it has multiple supports. Under no circumstance should Reliance Capital break Rs 355 levels.
On Tisco:
Tisco is unfortunately not able to sustain above the Rs 375 zone. And unless Tisco is able to sustain above Rs 370-Rs 375 levels, it cannot get into an up trend. Infact it is slowly drifting. The scary possibility of Tisco going to test Rs 335-Rs 340 levels, is now emerging on the scene.
On TCS:
TCS is just about managing to stay above Rs 1390-Rs 1395, which is a good support zone. Unfortunately, if TCS breaks Rs 1390 level then it will start turning weak. TCS is one of the relatively stronger shares. A decisive break below Rs 1390 could signify the possibility of TCS even going down to Rs 1325-Rs 1330 levels. And when this happens suppots will suddenly vanish.
The market is trading lower amid losses in pharma, FMCG, banking, metal, capital goods, oil and technology stocks. The Sensex is down over 150 points.
Technical Analyst, E Mathew discusses Ranbaxy, ACC, Grasim, Tisco, BPCL and Satyam.
Excerpts from an interview with Technical Analyst E Mathew:
On Ranbaxy:
Ranbaxy is breaking its support levels with ferocity. It has broken its support level at Rs 370- Rs 375 zone. Initiate a long position in Ranbaxy if and only if this stock is now able to trade above the Rs 390-Rs 392 zone with convincing volumes, otherwise we don’t feel this stock has still bottomed out.
On ITC:
One can go for long in ITC at Rs 100-Rs 105 levels. But it remains to be seen if it will come down to these levels. Depending on one's risk profile, if one is prepared to see downside about Rs 100-Rs 105, one could initiate a long position in it.
On ACC:
The cement counters indeed have lost their momentum. ACC was quite disappointing and the way it collapsed possibly after that result was not very encouraging. However, ACC has strong support now at around Rs 435 -Rs 438 zone. So long as the stock trades about this zone, even now there is still hope for revival.
On Grasim:
The relative strength of Grasim’s chart is much better than that of ACC. Stock is looking good on declines. If one could get the stock somewhere between Rs 1050- Rs 1070, could be a good opportunity.
On Reliance Capital:
One can say the worst is over for Reliance Capital if the stock is able to stay convincingly over Rs 385 levels with good volumes. The big break out for it would be around Rs 410. Infact, between Rs 385 and Rs 410, it has multiple supports. Under no circumstance should Reliance Capital break Rs 355 levels.
On Tisco:
Tisco is unfortunately not able to sustain above the Rs 375 zone. And unless Tisco is able to sustain above Rs 370-Rs 375 levels, it cannot get into an up trend. Infact it is slowly drifting. The scary possibility of Tisco going to test Rs 335-Rs 340 levels, is now emerging on the scene.
On TCS:
TCS is just about managing to stay above Rs 1390-Rs 1395, which is a good support zone. Unfortunately, if TCS breaks Rs 1390 level then it will start turning weak. TCS is one of the relatively stronger shares. A decisive break below Rs 1390 could signify the possibility of TCS even going down to Rs 1325-Rs 1330 levels. And when this happens suppots will suddenly vanish.
Monday, October 24, 2005
17.10.05-.22.10.05
TURN DATE : 18.10.2005
ACTIONS: TILL 2553 LEVEL UNBROKEN UPS IDE, TREND IS DOWN. THE CURRENT DOWNT REND MAY TEST THE BOTTOM LEVEL OF 2438 OR 2398 . USE ANY CORRETIVE RALLY UPTO 2514 OR 2534 FOR SELLING WITH SL 2543.
RESISTNCE ; 2496, 2514, 2524, 2537 AND 2552.
thats correct. NIFTY tested bottom side of 2398. i think coming week is better for support level.
Saturday, October 22, 2005
BT
Most investors are quite aware that BT is very cash generative but I am not convinced that all realise just how cash generative it is. Consider free cash flow. Of course estimates of true free cash flow are uncertain (to say nothing of difficult to do), so look at the more pessimistic measure of free cash flow post all capital expenditure (as opposed to just maintenance capex for a real free cash flow). BT should be able to keep this above 20p, most likely well above.
With BT’s share price currently at 221p, this implies that BT’s likely sustainable free cash flow per share (on this pessimistic measure) will be more than 10% of the current share price, and could well be over 15%.
As this is post capital expenditure, this is cash flow available to the shareholders after paying for investment in BT’s “new wave” businesses and its “21st Century” network upgrade.
It does not matter whether BT uses this money to pay dividends (it would be very surprising to see more than half go there in the short term), to by back shares (another return to investors) or to pay down debt. In either case it is money made for the shareholders and an increase in shareholder wealth.
Obviously there is a downside to this spectacular return (particular when it comes from a reasonably stable business, so not too much of it can be risk premium). Investors seem to expect that BT faces a gradual long term decline. It is certainly true that the heavily regulated fixed lines voice business faces a long slow decline. However the company has done very well so far in replacing revenues and profits from its traditional business with “new wave” business and, for the moment at least it seems likely to produce growth (albeit low growth) rather than actual decline.
With BT’s share price currently at 221p, this implies that BT’s likely sustainable free cash flow per share (on this pessimistic measure) will be more than 10% of the current share price, and could well be over 15%.
As this is post capital expenditure, this is cash flow available to the shareholders after paying for investment in BT’s “new wave” businesses and its “21st Century” network upgrade.
It does not matter whether BT uses this money to pay dividends (it would be very surprising to see more than half go there in the short term), to by back shares (another return to investors) or to pay down debt. In either case it is money made for the shareholders and an increase in shareholder wealth.
Obviously there is a downside to this spectacular return (particular when it comes from a reasonably stable business, so not too much of it can be risk premium). Investors seem to expect that BT faces a gradual long term decline. It is certainly true that the heavily regulated fixed lines voice business faces a long slow decline. However the company has done very well so far in replacing revenues and profits from its traditional business with “new wave” business and, for the moment at least it seems likely to produce growth (albeit low growth) rather than actual decline.
Tuesday, October 18, 2005
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