November 30, 2015

ASHOKLEY down 3% from all time highs on very high volumes

Once the selling is over, the stock will blast.

Some top gainers analysed

FRL up 16% - my best intraday trade with full 15% locked in - all thanks to randomness.

Market outlook

- trend is up on line charts
- on candlesticks, close above 7950 spot will be bullish
- option writing support is at 7500 and resistance 8500.

Same chart with lines

NIFTY futures intraday charts

- markets traded in initial range throughout the day
- nothing to do.

Hourly charts show support neat 7920 F

GOLDMAN: Stocks will go nowhere in 2016

Goldman Sachs is forecasting another lackluster year for the S&P 500.
Year-to-date, the benchmark index has gained about 1.3%.

"We forecast the S&P 500 index will tread water for a second consecutive year in 2016," Goldman's David Kostin wrote in the firm's 2016 stock-market outlook on Tuesday.

"Our year-end 2016 target of 2100 represents a 1% price gain from the current index level (2089), which itself is just 1% above the year-end 2014 level of 2059. Including dividends, we expect the total return in 2016 will equal 3%."

This low-return environment will persist as stock valuations remain relatively high. Kostin sees the price-to-earnings ratio at 16.2 times earnings next year, compared to an estimated 16.6x this year.


Nifty Levels for 30 Nov 2015 – Elliott Wave Analysis

Nifty Levels for 30 Nov 2015 – Elliott Wave Analysis

 | November 29, 2015
Nifty opened gap up on Friday at 7912 and declined till 7879 but bounced sharply from lower levels and traded positive for rest of the day with volatility. Nifty bounced almost 80 points from low to register day’s high of 7959 before closing 58 points up at 7942.

I expected a gap up above 7897 in my previous report and suggested to buy Nifty with stoploss of 7874 expecting targets of 7935-7956. Nifty opened at 7912, declined till 7879 and achieved 7935-7956 without breaking below 7874. Let’s have a fresh look at latest charts.


November 29, 2015

GOLD breaks 2015 year low / 2 year low on weekly charts

Buying levels for some stock with supports


CNX IT technicals

- trend is down on daily charts
- resistance is in region 11200-11300
- support 10800

BANK NIFTY technicals

- possible trend reversal in BNF
- holding above 17400 will be bullish this week
- support 16800

November 27, 2015

Market outlook

- trend is down on daily charts
- trend reversal level is 7950 spot
- today markets closed 0.7% up
- but advance decline was flat
- option writing support around 7500

NIFTY futures intraday charts

- first green arrow was buy signal (gapup, big bar up)
- exit long on break of rectangle
- short signal avoidable because of gapup / trend being up
- last long trade profitable

China Plunges Most In Three Months, Pushing "Black Friday" Into The Red For Global Stocks

After several months of artificial, centrally-planned calm in Chinese markets, where "malicious sellers" found out the hard way the Politburo means business, overnight the relative quiet in Chinese stocks since August broke with a bang when the Shanghai Composite tumbled as much 6.1% before closing down 5.5%, the biggest drop in three months and the largest weekly loss since the depth of the Chinese rout in mid-August while a gauge of Chinese volatility surged from the lowest level since March. 
China's market weakness pushed markets around the globe lower, and as a result all the levitation gains in yesterday's holiday market have been wiped out:

Elliott Wave Outlook and Levels of Nifty for Tomorrow 27 Nov 2015

Elliott Wave Outlook and Levels of Nifty for Tomorrow 27 Nov 2015

 | November 26, 2015
Nifty opened mild gap up today at 7837 and bounced sharply above 7880 followed by range bound consolidation between 7866-7897 before closing 52 points up at 7883.
Yesterday I expected Nifty to give a short term bounce and also suggested to buy Nifty if break above 7843 using 7822 as stoploss expecting intraday targets 7880-7915.  Nifty broke above 7843 just after opening and also achieved our target range 7880-7915 without breaking below 7822. Let’s have a look at latest charts now.
Today I am showing Elliott wave counts only after 16 Nov low 7714 as previous counts are same as I explained in my yesterday’s report Nifty EW Analysis for 19 Nov 2015 – Perfect Example of 3-3-5 Flat Correction. The chart given below is same as I explained in yesterday’s report as there is no change in it.

Pipavav Defence to exit CDR, Co to be renamed Reliance Defence

Reliance Infrastructure, together with its wholly owned subsidiary, Reliance Defence Systems, had announced a transaction for the acquisition of substantial shareholding and change of management control of Pipavav Defence & Offshore Engineering (PDOC).

The open offer will open on Dec. 2, 2015 and will close on Dec. 15, 2015. Reliance Infrastructure said that the company intends to exit the CDR (Corporate Debt Restructuring) package that the lenders of PDOC had approved in March 2015.

The change of control, reconstitution of the Board of PDOC, and change of name of the company to Reliance Defence and Engineering will be completed  in January 2016.

"The exit from the CDR is expected to lead to improved financial flexibility and increased business opportunities for PDOC, enabling the company to contribute to the security of the country, and pursue the Make in India and Skill India programmes of the Prime Minister, Narendra Modi, in an even more significant manner," it said.

GST India's 'Brahmastra' against global headwinds: Assocham

On the start of winter session of Parliament, new Assocham president, Sunil Kanoria today said it is time lawmakers across parties passed the Constitutional Amendment Bill on GST without further delay.  This would send a strong signal to investors that IndiaĆ¢€™s economy can overcome serious global and domestic challenges with political will.

He said GST can be a "Brahmastra" for the Indian economy against a very difficult global economic scenario, affected by demand slowdown, uncertain geo-political situation after the Paris terror attacks, and an unprecedented crash in vital commodities.

"GST will harmonise indirect taxes by doing away with multiplicity of taxes. It will also reduce cost of production, which will be then passed on consumers, thus lowering inflation.  More striking would be the display of a political unity and the will to rise up to national cause. That will be a great positive for revival of investment, both domestic and international, something most needed at this point of difficult international times," Kanoria said in his maiden media interaction. Kanoria is the vice chairman and managing director of SREI Infrastructure Finance.

Weak construction, real estate demand hurt Cera Sanitaryware

Cera Sanitaryware Ltd shares have slipped around 22% since mid-April over concerns of a slowing real estate and housing market. They had, however, touched an all-time high in April on expectations of upbeat revenue growth buoyed by the government’s cleanliness campaign—Swachh Bharat Abhiyan for building toilets.

It is the unorganized companies that have benefited from the programme so far, because of lower costs. “Only when the capacity of unorganized players reaches 100%, the organized players will get the benefit,” said Abneesh Roy, associate director, institutional equities, at Edelweiss Securities Ltd.

A few analysts have scaled down Cera Sanitaryware’s revenue growth forecast. They estimate around 16-17% revenue growth in the second half of FY16 compared with 18-20% guidance given by the management.

JP Morgan Might Offload Amtek Auto’s Troubled Bonds to a Vulture Fund at a Haircut

Amtek Auto’s bonds have been held by JP Morgan AMC, now in a segregated fund. The 200 crore worth bonds are it seems, in some kind of a deal with a vulture fund, SSG Capital Management. (Source: Economic Times)
While SSG plans to directly buy out the Rs 200 crore debenture holding held by JPMorgan, Amtek intends to settle the issue of the remaining Rs 600 crore debentures with the banks and realign the debt with Amtek’s future cash flows, multiple sources close to the negotiations told ET.
But SSG wants JPMorgan AMC to offer the debentures at a decent discount as well as the Amtek management to provide additional security besides stringent payment conditions – terms that the management is yet to agree.
“The fund has put the terms before the management and they have almost agreed to the terms. The negotiations are on and are in an advance stage,” said one of the sources. “We need to have regulatory approvals, which are pending at this point in time,” said one of the sources. “Till two week ago, JP and SSG were discussing the haircut…But if SSG gets more collateral, Amtek’s existing bankers would demand more cover,” said a person familiar with the situation.
The concept is: read here

FPIs sell for 11 sessions straight

In the longest selling streak by overseas funds in more than six months, foreign portfolio investors (FPIs) have offloaded equities worth $855 million in the last 11 sessions, reports Yoosef KP in Mumbai. Consequently, the Indian currency has been under pressure and slipped to its lowest level in two months — 66.6675 to the dollar — on Thursday before closing at 66.56. The currency has dropped 2% in November, the worst performance in Asia even as foreign holdings of rupee-denominated bonds have fallen by $558 million, the most since May, data compiled by Bloomberg shows.
On Thursday, foreign funds sold stocks worth $60 million in the cash segment on Thursday, provisional data from stock exchanges showed. In the last one month, the Sensex has shed 5.5% by wiping out Rs 2.5 lakh crore of investors wealth, Bloomberg data showed.

November 26, 2015

Lots of buy signals today

More signals at

Market outlook

- trend is down on daily charts
- high chances of trend reversal from current levels
- line charts already turning bullish; action not visible on candlestick charts
- close above 7950 spot will be bullish
- today, advance decline positive

Line charts

Nifty Expected Levels and Targets for Nov 2015 Expiry Day

Nifty Expected Levels and Targets for Nov 2015 Expiry Day

 | November 25, 2015
Nifty opened gap down at 7838 and registered low 7813 within second after opening but bounced sharply by 50 points from low. Nifty consolidated in 7840-7870 range till 2:00 PM followed by a decline of 45 points again. Finally Nifty closed 17 points down at 7831 after registering low of 7813 and high of 7870.
I my last report, I mentioned Nifty can decline 60-100 points from 7862 or from day’s high without breaking much above 7875-7882. Nifty decline just 50 points from high but without breaking above 7875-7882. Let’s have a fresh look at latest charts.

November 25, 2015

PSU bank bad loans jump 27%

Already burdened by bad loans, 37 banks, led by public sector ones, have reported a 26.8 per cent rise in non-performing assets (NPAs) over the 12-month period ending September this year.

This is a nearly 10 per cent rise from the 16.9 per cent growth in bad loans over the same period a year ago, with several projects, especially those in the infrastructure sector, stuck.

While the overall NPAs now amount to Rs 3,36,685 crore, the rise in the last 12 months ended September 2015 was Rs 71,000 crore, according to figures compiled by credit rating CARE.

The banks with a major share in bad loans include Bank of India, Bank of Baroda, Indian Overseas Bank, SBI and Punjab National Bank.


RCom to sell entire stake in Reliance Infratel

Reliance Communications (RCom) is close to finalising a deal to sell its entire stake in tower unit Reliance Infratel, sources aware of the development said. R Com owns about 96 percent stake in Infratel and the sale would fetch it around Rs 22,000 crore, which will be used to retire some debt. The sources further added the deal values Infratel at around Rs 22,500 crore.

Reliance Infratel has about 43,500 mobile towers. The debt of RCom stood at around Rs 38,000 crore. According to sources, the deal is almost finalised and is likely to be announced within 10 days. When contacted, RCom declined to comment. A few months ago, RCom had said that it had short-listed bidders that have sought to acquire up to 100 percent stake in Infratel.

FIIs Relentlessly Sell In Cash Markets, But There’s Some Hope Visible in Futures and Options

Chart: FIIs Relentlessly Sell In Cash Markets, But There’s Some Hope Visible in Futures and Options

By |November 24th, 2015|Categories: ChartsFII|0 Comments
FIIs continue to sell our markets. Like there’s no tomorrow! Here’s the FIIs in the cash market as we’ve seen recently:
FII Investments
Foreign investors seem spooked about something, we don’t know what. However, their positions in the futures and options market – in terms of open interest – point to a position that seems to be going less short now than they were earlier. They are cutting their short positions.

Metals: Bleak gets bleaker

Falling metal prices paused for breath in October, raising hopes they might have hit the proverbial bottom. Those hopes were dashed as prices continued to fall and have reached multi-year lows. Data from the London Metal Exchange (LME) shows the price of copper has declined by 28.6% in 2015 so far, while that of zinc has fallen by 30.2% and aluminium by 21%. Chinese flat steel prices are down by 39.6%. November alone has seen declines ranging from 2.5% for aluminium to 12.2% for copper.

The resumption of the fall, especially if it continues in this vein, spells more trouble ahead for metal companies.


November 24, 2015

Hot stocks and charts

LAST updated: 24-NOV-2015 
  • Computer generated BUY and SELL signals.
  • Signals are for your study only and are completely unsuitable for trading.
  • Golden stoploss: min 10% or last month's low (long position).
  • Do not risk more than 1% of your capital on any trade.
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ABB chart

NIFTY futures intraday charts

- first bar of the day was bullish as it appeared near support
- if you caught this long signal, fine otherwise difficult to enter afterwards
- circled area shows biggest bar of the day at that time which resulted in selling
- 7870 F offered stiff resistance during the day
- no clear short signal
- all in all a touch and go market - better off doing nothing.

Realtor debt worth Rs. 30,000 crore facing refinance risk: Crisil

India’s top 25 realtors, accounting for 95 per cent of the market capitalisation of the sector, stare at high refinancing risk of debt obligations worth as much as Rs.30,000 crore, as demand in their respective market is expected to remain tepid over the medium term, according to an analysis by Crisil.

“These 25 developers account for half of bank lending to the real estate sector. And most of those facing high refinancing risk are in the National Capital Region (NCR),” Sushmita Majumdar, Director, CRISIL Ratings, said in a statement.

According to Crisil, stagnating collections in the wake of declining sales velocity had resulted in debt taken for residential projects by these developers surging by 25 per cent to Rs.61,500 crore in fiscal 2015. “Saleability of projects has also been declining, especially in north India. Another area of concern is inventory, which surged to 58 and 48 months, respectively, in the north and west at the end of fiscal 2015. South India had a more comfortable 22 months of inventory.”

Nifty Elliott Wave Theory Analysis for 24 Nov 2015

Nifty Elliott Wave Theory Analysis for 24 Nov 2015

 | November 23, 2015
Nifty opened mild Gap up today at 7869 and bounced till 7877 but traded in 50 points range for rest of the day with negative bias. Nifty closed 7 points down at 7849 after registering day’s high of 7877 and low of 7825.
I my last report, I mentioned that the possibility of good upside but the upside must be faster, any slow move or consolidation below 7905 will create doubts in up move. I also suggested buying in 7836-7794 range with stoploss of 7883 for minimum targets 7905, Nifty entered in 7836-7794 range but bounced till 7864 only and closed at 7849. An intraday trade gave only 15-25 points profit. Let’s have a look at latest charts now.

November 23, 2015

The Biggest Problem for the Economy

The Indian economy is clearly not out of the woods. Over the last 18 months, the Modi government has initiated quite a few reforms. The intention continues to remain positive. Sadly, the speed of the reforms process has left a lot to be desired.

On the positive side, the fall in commodity prices has helped India a lot. Inflation is lower than what it used to be. Interest rates are falling. FDI flows have improved. The international narrative about India is still positive. Unfortunately, this will help beyond a point.

India' problem stemmed from a lack of trust by entrepreneurs to invest in the economy. This was partly because crony capitalists came under fire during the UPA 2 years. But mostly, it was due to multiple problems facing the economy: policy paralysis, corruption, labour & land issues, etc. Without investments on the ground, growth was bound to stagnate.

The reality today is the same. Investments have yet to pick up. 


Vedanta, Hindalco slip over exit from Sensex

Shares of metal and mining firms Vedanta and Hindalco Industries, came under selling pressure on Monday following BSE's announcement last week that the stocks will no longer be part of the 30-share Sensex from December 21.

Hindalco closed lower by 3.8% to Rs 74.35 after shedding as much as 4.5% intraday, while Vedanta slid 2.9% to Rs 90.45 on Monday. "Since there are many domestic and overseas funds that invest only in the index, there is bound to be selling pressure on scrips that go out of the index," said Satish Menon, executive director, Geojit BNP Paribas.



My take on this - I am not surprised. Over a period of time, expect some good stocks to be removed from key indices. Other stocks on the chopping board - Tata Steel, Tata Power etc.

Hot stocks and charts

LAST updated: 23-NOV-2015 
  • Computer generated BUY and SELL signals.
  • Signals are for your study only and are completely unsuitable for trading.
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  • Do not risk more than 1% of your capital on any trade.
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Interesting charts of today's top gainers

GODFRY PHILIPS up 7% today

Market outlook

- rangebound trading today
- advance decline positive
- some increase in VIX
- formation of higher lows still remains intact

NIFTY futures intraday chart

- first buy signal failed / stoploss hit
- short trade not considered.

Rise in oil consumption hints at likely economic liftoff

MUMBAI: A bunch of key barometers of economic health has shown steady improvement in the past months, an encouraging sign that growth may be finally picking up momentum.

Commercial vehicle sales, a key indicator to activity in the economy, have been buoyant of late. While passenger vehicle sales have also been up, consumption of petrol and diesel has surged as crude prices have remained soft. Sales of petrol by volume have been rising for three months in a row, diesel by two and passenger cars for seven.

F&O volumes drop after increase in contract size

Volumes in the derivatives market have seen a sharp dip in November after the market regulator raised the bar for participation in the equity derivatives segment in an attempt to curb retail investor activity in this relatively high-risk segment.

This was done due to fears that retail investors were becoming more active in this segment and could be put at risk.

For the month of November so far, the average daily volumes on National Stock Exchange (NSE) have dropped sharply to 3.37 million contracts from 8.78 million contracts in October.

Jayant Manglik, president of retail distribution at Religare Securities Ltd, said that fewer people are now trading in derivatives, which he says was the intent behind Sebi’s changed policies.
Views on whether Sebi’s decision was right or wrong are still mixed.
“It is a good move. In the medium to long run, it will definitely help,” said Nitn Jain, chief executive officer of global asset and wealth management at Edelweiss Financial Services Ltd.
“A lot of derivatives volumes were driven by guys who should not have been there in the first place. They play on high leverage and low brokerage.”

Is the Bubble Bursting for India's Online Start-Ups?

Hundreds of layoffs at several Indian start-ups have sparked fears the bubble is starting to burst for the country's e-commerce companies, amid claims by analysts that many of them are overvalued.

Restaurant search website Zomato, food delivery app TinyOwl and property portal are all letting staff go, and experts are warning of echoes of the dot-com boom which crashed spectacularly in 2000.

"The valuation bubble is bursting. The valuations had reached levels where they were ridiculous and could not be justified at any level," said Arvind Singhal, chairman of management consulting firm Technopak.


Nifty will face earnings pressure over the next 6 months: Saurabh Mukherjea

September was another quarter of muted corporate earnings growth, with companies struggling to push volumes amid a slowdown in demand. Saurabh Mukherjea, chief executive officer - institutional equities, Ambit Capital, tells Puneet Wadhwa it is not the global slowdown which is holding back Sensex EPS growth but Prime Minister Modi's resets around black money, crony capitalism and Aadhaar. Modi, Mukherjea says, is changing the way consumption and capex takes place in India and corporate India is finding it hard to come to terms with these changes. Edited excerpts:

How do you see the global markets playing out over the next few months?

My reckoning is that the beginning of rate rises by the US Federal Reserve in December, combined with debilitating weakness in the Chinese economy, will be a potent combination for volatility generation. We have the world's two largest economies pulling in opposite directions, and that cannot be good news.

You put out a Sensex target of 22,000 a few months ago. Do you still hold this view?


GoBoSo fails to glitter

The government's much touted sovereign gold bond scheme has failed to cut much ice with the public, say bankers, who also blame the high issue price as the biggest dampener.

Public sector bankers whom PTI spoke to also attributed the many market holidays and affinity of the public towards physical gold for the subdued demand for ambitious sovereign gold bond scheme, which was the maiden offering by the government so far.

Although the Reserve Bank of India has not formally disclosed the overall funds collected under the scheme, bankers have pegged it at around Rs 150 crore.

"The primary reason for this lower-than-expected collection is the higher issue price. The RBI had set it at Rs 2,684 a gram, whereas the market price was lower. Why should somebody buy at higher price?" said a senior banker from a state-run bank.

He said his bank was targeting around Rs 50 crore from the scheme but could only collect one-tenth of it.

Market experts also vouched this, saying 4-5 per cent premium on the market price is not acceptable to a buyer, therefore the dismal demand.

November 22, 2015

Important Levels of Nifty for 23 Nov 2015 – Elliott Wave Analysis

Important Levels of Nifty for 23 Nov 2015 – Elliott Wave Analysis

 | November 22, 2015
Nifty opened flat on Friday followed by mild decline till 7817 but bounced sharply by 90 points from lows   in middle session followed by a range bound consolidation between 7880-7905. Nifty declined sharply again by 60 points in last 60 minutes of trade before closing 13 points up at 7856.
I my last report, I expected some decline till 7815 or 7798-7769 followed by a good bounce for upside targets of 7871-7961. Nifty declined till 7817 to complete a corrective wave followed by a sharp bounce of 90 to achieve our minimum target of 7871 whereas 7906 was high for the day. Let’s have fresh look at charts again.

Mutual funds invest Rs. 2 lakh cr in debt market

Mutual fund managers remain bullish on the debt markets and have pumped in more than Rs. 2 lakh crore in them during the ongoing fiscal so far.

This is on top of Rs. 5.87 lakh crore already invested by them in the entire last fiscal, 2014-15.

According to the latest SEBI data, fund managers have invested a net Rs. 2.06 lakh crore in the debt markets during the current fiscal, started April 1, till November 19.

In contrast, Foreign Portfolio Investors (FPIs) have made net investments of Rs. 52,531 crore during the period.

Apart from debt markets, MFs have invested a little over Rs. 55,000 crore in equity markets during the period under review.

The latest inflow has helped the mutual fund industry to hit all time high of Rs. 13.24 lakh crore mark in assets under management.

FinMin considers allowing more pension funds in equities

The Finance Ministry is considering a proposal to raise investment limit of pension funds in stock markets to 50% and a decision is expected in a short time, PFRDAChairman Hemant G Contractor has said.

At present, the Pension Fund Regulatory and Development Authority of India (PFRDA) is allowed to invest up to 15% of the corpus into the stock market.

The hike in investment limit into the equity market is one of the recommendations of the G N Bajpai committee. The expert panel under ex-Sebi Chief was set up by PFRDA to review the investment guidelines for National Pension System (NPS) in the private sector.

November 21, 2015

YESBANK res 780 sup 710 trend down

SUNPHARMA breaks support on weekly charts

RPOWER trend reversal if 47 breaks

OIL monthly charts

JET AIRWAYS triangle monthly charts

MARUTI triangle

Why Did The Dishman Pharma Stock Fall by 14%?

Dishman Pharma hit a new low yesterday as they plummeted by more than 14%, the biggest single-fall since 24th August. The prime reason behind this sudden fall is because of the request made by FDA on one of it’s customers, Clovis Oncology, for more data on their awaited drug, Rociletinib, which is supposed to help treat lung cancer patients. Dishman’s Swiss subsidiary, Carbogen Amcis, was to make the API (Active Pharamaceutical Ingredient) for Clovis.

FDA asked for more data confirmed responses(tumor shrinkage) in the clinical programme using Rociletinib. Clovis has been highlighting combined response rates – that is, both confirmed and unconfirmed responses to the drug – in its public stats, but apparently FDA will only look at confirmed responses. The stats point to a confirmed response rate of 28% in 79 patients using 500mg dose and a 34% confirmed response rate in 170 patients using 625mg dose of rociletinib, competitor AstraZeneca’s Tagrisso’s confirmed response rate is 59%.

Clovis shares fell 70% in the US on Monday, and a further 11% on Tuesday. Monday’s fall must have spooked investors and took it out on Dishman.

How did Dishman Pharma take the hit because of Clovis Oncology?


Chart: Nifty’s Aggregate Profit Growth Goes Negative, For Three Consecutive Quarters of Contracting Profits

The NSE’s Nifty has 50 companies. That index is the top 50 companies in India by market-capitalization (technically, free-float market cap, meaning shares that aren’t owned by the promoters)

If you add up the revenues and profits of these companies, and you compare the aggregate numbers with the aggregates of the previous year (of the same companies), you see how the performance is of the Index as a whole. Given that revenues and profits tend to be skewed towards the bigger producers, this does skew the index towards the biggies – for instance, an ACC has a quarterly profit of just Rs. 100 cr. or so, while TCS has a quarterly profit of over Rs. 6,000 cr.

However, the aggregate numbers will usually smooth out any smaller issues, and is a useful way to look at the index as a whole.

The problem? Well, we’ve had three lousy quarters now, of falling profits, and of falling revenues.


Maintain ‘buy’ on Apollo Tyres, target Rs 240: Kotak

Apollo Tyres announced the acquisition of 100% stake in Germany based tyre retailer, Reifencom, for 45.6 million euro (at 0.3X FY2014 revenues). Reifencom is a profitable and zero-debt entity, operating 37 retail stores and an online portal, accounting for ~4% market share in the replacement segment of Germany’s passenger car tyre market.

The acquisition will provide better market access to Apollo’s European operations and its ‘Apollo’ branded tyres, in our view.We continue to remain positive on the growth prospects of Apollo’s European operations, expecting it to significantly scale-up its presence in the next 3-5 years.

Retain ‘buy’ on Havells India, target Rs 304: Nomura

The second quarter numbers of Havells India missed at the topline but EBITDA was in line on higher margin. 2H outlook appears robust on reviving infrastructure spend and upcoming festive demand.

The second quarter numbers of Havells India missed at the topline but EBITDA was in line on higher margin. 2H outlook appears robust on reviving infrastructure spend and upcoming festive demand. Increased industrial demand is likely to translate into stronger sales not only in wires and cables but also in switchgears where EBIT margins are likely to be sustained. This is likely to lead to increased sales and better EBIT margins.

Stronger infrastructure spending has led to increased demand for electrical wires and cables with industrial volumes up 16% y-y and domestic volumes up 4% y-y. Overall segment revenue was lower owing to lower commodity prices.

Increased industrial demand is likely to translate into stronger sales not only in wires and cables but also in switchgears where EBIT margins are likely to be sustained. This may lead to increased sales & better EBIT margins.

Revenue decline is attributable to: a) a 1.3% decline y-y in switchgears, b) cables and wires falling by 5% y-y despite volume growth of 16% and 4% in industrial and domestic segments owing to weaker commodity prices; c) lighting and fixtures growth (1.5% y-y) being muted as LED growth (+48% y-y) was offset by decline in CFL volumes; and d) electrical consumer durables growing at c6%.

Factories running 30% below capacity: Rajan

The Reserve Bank of India’s (RBI) governor, Raghuram Rajan, said the economy was being hampered by a drop in public and private investments but held out hope that strong foreign capital flows would help rectify this weakness.

Weak capital investment has been a hurdle in India’s quest to realise its growth potential and with factories running 30 per cent below capacity, private companies are in no rush to invest in new projects.

“On the growth front, the central concern is with investments,” said Rajan, who was speaking at a business event in Hong Kong on Friday. “Private investment has fallen back quite a bit and so has public investment.”

RBI has cut its growth forecast for the current financial year to 7.4 per cent from 7.6 per cent previously, well below the government’s target of eight to 8.5 per cent, but still faster than China.

Despite the slowdown in growth and investments, Rajan said strong foreign direct investment (FDI) and some traction in infrastructure development could encourage private investments.

During the period from January to June, FDI flows into India rose to $19.4 billion, up 30 per cent from a year earlier, a sign of what the government called investors’ growing confidence in the country.

Earlier this month, India eased foreign direct investment norms in 15 major sectors, including mining, defence, civil aviation and broadcasting.

“We are seeing a lot of traction in FDI, in both announcements and actual investments on the ground,” Rajan said.

“Once we start seeing a little stronger demand, we will start seeing more projects being pulled out of the drawer.” The central bank cut the benchmark policy rate by a half percentage point to 6.75 per cent in September, after months of pleading by government leaders and industrial groups for more stimulus to stoke growth.

November 20, 2015

India poised for one of highest growth in emerging Asia: OECD

Boosted by an improved business environment, Indian economy is projected to see "one of the highest levels" of growth among emerging Asian countries, a report by Paris-based think tank OECD said today.

Boosted by an improved business environment, Indian economy is projected to see “one of the highest levels” of growth among emerging Asian countries, a report by Paris-based think tank OECD said today.

While projecting an economic expansion of 7.2 per cent for this year and 7.3 per cent next year for India, OECD noted that large non-performing loan is a potential barrier to continued growth.

“Real growth in Emerging Asia is projected to average 6.5 per cent for 2015 and 6.2 per cent annually over 2016-20. Growth will continue to slow in China while remaining strong in India at one of the highest levels in the region,” the Organisation for Economic Cooperation and Development (OECD) said.

Emerging Asia refers to economies of Southeast Asia, China and India.

For the 2016-20 period, India’s average real GDP growth is anticipated to be 7.3 per cent, it said.

NIFTY weekly charts

- nifty trading within falling / sloping channel
- breakout from this channel will be bullish
- lower end of channel hints at support around 7200-7400
- holding above 7950 will be bullish

Market outlook

- trend is down on daily charts
- close above 7860 AND near day's highs will be bullish
- today markets opened strong but we saw selling off day's highs
- advance decline positive
- option writing not giving any clues

NIFTY futures intraday charts

- breakout from initial trading was bullish
- note I did not consider day's range as markets were close to a swing low in prev day's chart
- cover longs around 7900 F
- short trade not considered as broader trend was breaking out upwards

When to sell a stock (fundamental view)

Most investment gurus tend to find selling much harder than buying. As Sanjoy Bhattacharya, the founding CIO of HDFC Mutual Fund, says in Chapter 1 of my book, Gurus of Chaos, 'Selling is well and truly the dark continent of investing.' So, I thought I would take a stab at how I, as a broker, identify high-conviction sells.

Let's now turn to the more effective selling rules. Firstly, it makes sense to sell a stock when you can see that the competitive moat around that company is eroding. For example, for more than a decade after Maruti entered the Indian market, Hindustan Motors, the manufacturer of the now obsolete Ambassador car, was a Sensex company. Even after the opening up of the Indian economy in 1991, investors did not figure out that this company's moat was going to be eroded by economic liberalisation. I reckon investors face a similar risk in Indian banking, housing finance and NBFC stocks, given that the RBI is now whacking out new banking licences by the dozen.

Secondly, it makes sense to sell, I believe, when a company's capital allocation is deteriorating.


Elliott Wave Levels and Targets of Nifty for 20 Nov 2015

Elliott Wave Levels and Targets of Nifty for 20 Nov 2015

 | November 19, 2015
Nifty opened huge gap up today at 7788 and declined marginally till 7765 but traded with huge strength for rest of the day to register day’s high of 7854 before closing 110 points up at 7842.
I suggested in yesterday’s report to exit any shorts if Nifty break above 7776 and wait for corrective decline to enter longs and we can expect upside targets of 7860-7930. Nifty opened above 7776 at 7788, gave a corrective decline till 7765 and bounced till 7854 almost achieving minimum target of 7860. Let’s have a fresh look on latest charts.
Today I am showing Elliott wave counts only after 16 Nov low 7714 as previous counts are same as I explained in my yesterday’s report Nifty EW Analysis for 19 Nov 2015 – Perfect Example of 3-3-5 Flat Correction.

Damage of six years has been reversed in a matter of a year: Ridham Desai

Damage of six years has been reversed in a matter of a year: Ridham Desai

Morgan Stanley’s head of India research says competitive federalism has emerged as the NDA‘s biggest contribution to the nation as states put in place critical reforms to attract investments.
Singapore: Competitive federalism has emerged as the National Democratic Alliance (NDA) government’s biggest contribution to the nation as state governments put in place critical reforms such as land and labour law changes to attract investments, said Ridham Desai, managing director and head of India research, Morgan Stanley, in a recent interview on the sidelines of a conference organized by the investment bank in Singapore. Prime Minister Narendra Modi has enlarged the revenue share of states and given them greater independence in decision making, which Desai traces to Modi’s experience as chief minister of Gujarat. 

Havells India: light at the end of the tunnel?

Shares of Havells India Ltd, a maker of lighting products, cables and fans, have rallied since it announced earnings last week, outperforming the broader markets. The rally was on the back of expectations of better demand during the festival season and a pickup in infrastructure spending.
The company management, during the conference call with analysts, said it expected decent growth in the second half of the fiscal year as there was some traction seen in demand in the past two months.
Domestic brokerage firm Emkay Global Financial Services Ltd in a note dated 9 November estimates 13-15% revenue growth in the second half of FY16 because of a low base, following muted 1% growth in the first half of the fiscal year.

Forget the Nifty, make your own index, says Porinju Veliyath

You have tweeted that one should make his or her own Nifty or own index. How many stocks should you put into that?
I love a 10-stock portfolio. We have around 650 clients and the average number in a portfolio will be 10 stocks — you can say it is a concentrated portfolio. Following the Nifty is easy and anybody can do it. You don’t need any special skill or expertise or knowledge or wisdom. In the last one year, the Nifty is down 6-7 per cent, my clients on an average are making over 40 per cent return. I am not a Nifty fan. I am making my own index.
All serious investors who want to pursue value investing, should make their own portfolio — the development in those companies, the progress in those companies, how they are managed and how they are creating wealth for you — that’s the only thing important for you.

Norms relaxed as only 400 gm gold deposited

In the fortnight since the scheme was launched, only 400 gm gold has been deposited and with only one bank, as no other bank had tripartite agreements with hallmarking centres and gold refiners. Now, the finance ministry and the Bureau of Indian Standards (BIS) are simplifying the administration of the scheme to get it moving.

In contrast, the response to gold bonds and coins has been much better. A government source said retail investors had applied for Rs 100 crore worth of bonds and 6,000 gold coins had been sold.

The gold monetisation scheme, bonds and coins were launched on November 5 by Prime Minister Narendra Modi, to reduce bullion imports and mobilise 22,000 tonnes of idle gold in the country.


Forget IIP data, Inflation Data or Interest Rate - Just see Toilet Data of India

Don’t See IIP ,Inflation Data or Interest Rate ,Economy !Just see Toilet Data of Bharat (Not of India )

Clearing the line would take at least 5,892 years, if each person took a minimum of four minutes to use the toilet, according to the report by WaterAid, a water and sanitation nonprofit headquartered in London said.
India continues have the largest number of people without toilets at home and the highest number of people defecating in the open, the report titled, “It’s No Joke: The State of the World’s Toilets 2015,” says.
More than 770 million people in India still don’t have access to improved home toilets, more than double China’s 329 million people who don’t have a toilet in their house.

November 19, 2015

Top gainers analysed


Market outlook

- trend is down on daily charts
- trend reversal level is 7865 spot
- close above 7865 and near day's high will be bullish
- advance decline positive today
- VIX drops by 9% today

NIFTY futures intraday charts

- breakout from initial trading range was buy signal
- cover around 7830 F
- ignore arrows - this is some system I am working on for a friend

Indians Refuse To Give Their Gold To The Government: Only 30 Kilograms Take Part In "Gold Monetization Scheme"

One week after the gold scheme's official launch, the "gold monetization" plan has been a disaster with a laughable 30 kilograms in gold tendered by the people from physical into "government-backed" form.
The Times of India has the details, and reports that in the first-week "collection by the government's sovereign gold bond scheme has been rather tepid with less than Rs 10 crore being reported to the Reserve Bank of India (RBI). The scheme, which closes on November 20, allows investors to purchase between 2 and 500 grams of gold-equivalent.
The spin was immediate: "bankers say that in any issue, savvy investors - including high net worth individuals - usually hold off until the closing date before locking in their funds." Or maybe they don't lock in their funds at all since giving the government your physical gold in exchange for a interest payment - in other words, converting gold into a paper asset with the government's blessing - is about as stupid as it gets. 

NYSE to do away with stoplosses

The New York Stock Exchange is eliminating an order type that investors including BlackRock Inc. blame for exacerbating extreme share-price swings on Aug. 24.

Stop orders -- or instructions to immediately trade once a stock hits a certain price, even if the price is far worse than the one on the order -- will no longer be available starting on Feb. 26, NYSE said this week.

FUNNY: ISIS attempts to shoot down Russian jet and see what happens...

Did Goldman Sachs Just Find The Smoking Gun In Today's FOMC Minutes?

4. Participants also noted that the lower long-run equilibrium rate implies that the near-zero effective lower bound could become binding more frequently. As a result, “several” participants indicated that it would be “prudent” to consider “options for providing additional monetary policy accommodation” should the economic recovery falter.
In other words - as the bolded sections highlight -
The Fed is admitting that the neutral rate (to which they will theoretically raise rates before re-easing) will remain lower for longer...
...and therefore will reach ZIRP more frequently going forward...
...which means, as they state, using "additional monetary policy accomodation."
Which means, unless The Fed wants to implement NIRP (which it appears it does not), they will have to do more QE, more frequently going forward...
...basically admitting that the rate manipulation transmission channel is defunct for all intent and purpose.
*  *  *
So what Goldman discovered was the 'smoking gun' admission that this is no normal recovery and what was once entirely extreme and experimental monetary policy will be the new normal... and that may be why stocks and bonds rallied and why the dollar dropped and gold and crude gained.

Bank Of Baroda Sees a 375 Cr. Fraud And Quietly Takes The Hit

Suckered: Bank Of Baroda Sees a 375 Cr. Fraud And Quietly Takes The Hit, But Who is the Company That Frauded Them?

By |November 18th, 2015|Categories: BanksFraudsSuckered|0 Comments
Bank of Baroda has an interesting footnote in the Sep 2015 results:
Fraud in Bank of Baroda
Wow, you think. 375 crores! That’s a lot of moolah to lose in one fraud. But apparently, this was in a bill discounting fraud in Ahmedabad:
There is a suspected fraud. An internal probe is on. If the money cannot be recovered, the bank will have to take a hit… An established company is involved, but I’m not in a position to disclose the name… We sensed something was wrong when a few bills bounced,” said the person who declined to share details as an investigation is underway.
It is understood that one of the bank’s offices in Ahmedabad ended up discounting bills against which the underlying trade transactions were fake or non-existent.

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