HUDA Scheme: Residential Plots in Faridabad

huda logo1 Haryana Urban Development Authority has launched a scheme to allot freehold residential plots in Faridabad and other areas like Sonipat, Rohtak, Bahadurgarh, Ambala, Jind, Hisar and Palwal.

Though the scheme is launched for various urban areas, the center of attraction is the allotment of 1,969 plots of various sizes in Faridabad.

Salient Features of the Scheme

  • Faridabad is an integral part of the NCR region and has good connectivity and proximity to Delhi. Though the region has been sluggish as compared to other NCR regions like Gurgaon is terms of appreciation in real estate prices, it does offer ample scope as there are talks of modernization of Mathura Road and work on Badarpur flyover as well as access to Metro in near future will provide facelift to the area.
  • Crime Rate in Faridabad is far less as compared to other popular regions in terms of real estate development like Noida and Ghaziabad.
  • The Rates offered in HUDA Scheme are quite competitive and offer even a good long term investment opportunity for those who want to invest in real estate to create wealth.
  • HUDA Scheme offers facility of payment in Installments. 10% Payable at application, 15% within one month of allotment and balance in Six equal Annual Installments.
  • Interest @5.5% per annum on the amount of earnest money for period beyond six months of closing date of scheme if the draw is not held and earnest money not refunded within this period.
  • Allotment will be made through draw of lots.
  • Any Individual can apply under the scheme provided he has not been allotted a plot of land directly by HUDA in the concerned Area. If you want to apply under reserved category, you must be a domicile of Haryana.

Concerns on the Scheme

  • You earnest money could be stuck with HUDA for as long as Six months without interest and thereafter @ 5.5% p.a. interest.
  • Development on Delhi-Mathura Highway and completion of Badarpur Flyover/ Access to metro is the key to next phase of price appreciation in the region and any delay on this front can take the sheen away for the investors.
  • Faridabad is grappling with pollution like other NCR regions. All the areas of the Faridabad including residential areas, industrial areas and silence zone are in the grip of air pollution. A part of it can be blamed to its initial planning as an Industrial township. Even the quality of water is a area of concern as a recent study has found water levels to be highly polluted and unfit for drinking.
Conversion of Marla in Sq. Mtr., Sq. Yard and Sq. feet

Since the HUDA brochure talks in terms of Marla , you can refer the table below to see the equivalent size of plot in various dimensions

conversion

Download HUDA Application Form (remember to include additional Rs.100 while preparing the earnest money draft if you are using the downloaded version of application form)

Download HUDA Scheme Brochure

Last date of Application : 05-01-2010

Update : 04-01-2010

The Last date of Application has been extended to 06-01-2010

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IPO Update: Indiabulls Power Ltd.

In Quest for Power “full” India

indiabullspowerlogo Indiabuls Power Ltd. has entered the capital markets with an issue of 33.98 Crore shares of Rs. 10 each at a price band of Rs. 40-45 per share. Investment Guru is of the view that India Bulls is just another player trying to leverage the India Power Story like Adani, Reliance and Tatas. The company is currently in the process of setting up its power plants will take 3-4 years to start commercial operations. It’s a story similar to Adani power and hence it’s more of a long term play.

  • The Company is a subsidiary of IBREL, a part of the Indiabulls Group.
  • IBPL is currently executing five power projects: 1,320 MW Amravati Power Project – Phase I, 1,335 MW Nashik Power Project, 1,320 MW Bhaiyathan Power Project, 1320 MW Amravati Power Project – Phase II and 1320 MW Chhattisgarh Power Project.
  • The company expects to sell 75 per cent of the power generation via a long-term power purchase agreement (PPA) and balance through trading of power.
  • Since the company has not yet commenced the operations, there is no financial performance to compare with other players.
  • The projects are expected to be funded through a D/E ratio of 75:25.
  • It is also developing four medium size Hydro Power Projects in Arunachal Pradesh aggregating to 167 MW. Indiabulls has also entered into MoUs with the Govt. of Madhya Pradesh and Jharkhand for setting up of 2640 MW & 1320 MW Thermal Power Projects in each of these States respectively.

Investment Guru is of the view that we have already seen what happened to the Adani and NHPC issues and there is no reason why Indiabulls should get different treatment. The stock is currently commanding a premium of Rs. 4-5 in grey markets but for that matter even Adani commanded a premium in grey matter. This is a pure long term play and the stock will become dull after listing sensations until news of developments on the operational front starts coming in. For those who are looking for listing gains, if the promoters decide to price at a lower band , you can look for a 10% gain otherwise you would have to pray for your luck .

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Reliance declares 1:1 Bonus and Rs.13 Dividend

ril For those who thought that days are gone for this once evergreen stock , it’s time to be taken aback. Reliance Industries has added to the diwali celebrations of its shareholders by announcing a combo of a liberal 1:1 Bonus issue (after a gap of 12 years) and Rs. 13 per share dividend.

 

What does this Bonus means for Reliance Shareholders ?

  • The Bonus issue is an attempt by Reliance Industries to instill confidence in the shareholders towards the tradition of this company to bestow Investor friendly measures.
  • Bonus Issues doesn’t change anything in terms of Financial performance & fundamentals of the company and hence is EPS neutral. However, it does have an indirect impact in terms of improving the sentiments for the stock and brings in more liquidity. Historically , we have seen run up in the stocks after Bonus announcements and stocks have given better returns post Bonus adjusted prices. So, essentially, it is a sentiment booster measure.
  • The timing cannot be more right for the company to announce a bonus as the stock price of reliance Industries has been a laggard as compared to sensex performance due to the ongoing tussle between Mukesh Ambani and his younger brother Anil Ambani over the Gas supply pact. The Bonus issue will provide some impetus to the investor sentiments which was clouded by the ongoing dispute.
  • The Bonus issue has been on account of two major milestones achieved by the company i.e., successful commencement of Gas production from its KG6 Basin and building of new refinery at reliance Petroleum.
  • The Bonus issue is also applicable to shareholders of Reliance Petroleum shares pursuant to recent amalgamation of the company with RIL. The company has fixed Record date of 29th September for reckoning the members entitled to receive 1 Share of Reliance Industries for every 16 Shares held in Reliance Petroleum.
  • The Record date for Bonus has not been announced yet.
Read More!

OIL India : Listing Strategy

OIL India is going to list on NSE and BSE on Wednesday,30th September,2009.
There was a good response from QIB and HNI segment. However, the retail segment was oversubscribed 1.76 times. The Current Grey market premium for Oil India is in the range of Rs. 50-60.

Investment Guru is of the view that the stock may list at a modest premium of Rs. 50-100 against its issue price of Rs. 1050. Though the fundamentals of the company are quite strong, it has the inherent limitations of sharing of Subsidy Burden and inadequate geographical spread which would keep a tab on its performance. Though the company has a impressive track record on On-shore drilling, it has yet to prove its expertise in off-shore segment. Read More!

Stock Review : Uttam Galva Steel

Will Mittal factor change the fortunes for Uttam Steel ?

Stock : Uttam Galva Steel

CMP : 113

Book Value: 71.04

EPS (Trailing) : 9.49

As the performance of the stock suggest, Markets had a clue about it ! Uttam steel has already risen by 83% in just One month.  The stock has more than doubled in last 3 months. So what’s the buzz !!!  Global Steel King L.N. Mittal is making a debut in India by acquiring 35% stake in Uttam Steel.

Mittal’s company Arcelor Mittal is all set to become the Co-promoter of the company. The promoters have signed an agreement to sell 5.6% stake in Uttam steel.  Arcelor Mittal will launch an open offer on September 7 to acquire balance 29.4% stake in the company. Mittal is offering a price of Rs. 120 per share for acquiring this stake.

If the offer by Mittal remains unsubscribed, the promoters would transfer further stake to Mittal so that both have equal stake in the company.

 

How will this deal help Uttam Steel ?

Apart from giving foothold to Arcelor Mittal in Indian Steel sector, the deal would be a facelift for Uttam steel. The association with Mittal is surely going to be big boost to the brand name of Uttam steel.

Uttam steel is set to get better availability of Raw Material. The company already sources around 50% of its raw material from Arcelor Mittal.

It will also have an opportunity to transform itself from a galvanized steel producer to a integrated Steel major. It will have access to latest technology from Arcelor Mittal and access to new product segments and geographies.

 

Demerger of Power Biz

Another important development is that recently  the Bombay high court has sanctioned the scheme of arrangement between Uttam steel and power and Uttam Galva Steel for the demerger of the power division of Uttam Steel and power into the company. The Scheme has got effective from 21st August,2009.

The demerger of power division will help separate listing of this entity and help shareholders to unlock the value of their investment in the company.

 

Current Financials

For the Year ended 31st March, 2009 company posted a top line of Rs. 4372 Crore and Net profit of 100 Crore.  Though this was a growth of  over 38% over last year, the profit were lower by 24 Crore on account of high interest outgo and higher operating costs.

Uttam steel clocked a turnover of 1073 Crore for the first quarter of the current year and a Net profit of 34.57 Crore.

Investment Guru is of the view that both the developments i.e., Acquisition of 35% stake by Arcelor Mittal @ 120 per share and Demerger of power division hold good omen for the company and would not only boost its brand image but also enable it to log a impressive growth in coming years.

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IPO Update : Jindal Cotex Ltd.

Too pricey to fit the bill – Avoid

Company : Jindal Cotex Ltd.

Issue Price : Rs. 70 – 75

Outlook : Avoid

About Jindal Cotex

Jindal cotex is engaged in the business of manufacturing of Acrylic, Polyester, and Polyester- Viscose, Polyester Cotton, combed and carded yarns, which are appropriate for apparels, suitings & knitted fabrics. Company has current installed capacity of 23,472 spindles for acrylic, cotton blended and polyester yarns. It manufacture and sell yarns under the trade name ‘JINDAL’.

 
Objects of the Issue

The Company is setting up a new facility to manufacture cotton yarn with a capacity of 28,800 spindles in Ludhiana in Phase I.

It will further add 21600 Spindles, Yarn dyeing facility and a Garment unit with capacity of 3000 pcs. per day in Phase II.

The company would use the funds to invest in Subsidiary Jindal Medicot which manufactures Medical Textile products. It would also invest in another subsidiary Jindal Specialty textiles which manufactures PVC Laminated products.

Financials

The company has put up an impressive top-line growth of 39% for year ended 31st March,2009. However the same momentum was not visible in the bottom line which grew only by 2.3% which suggest that operating cost increased in much bigger proportion.

 
Overall Assessment

The company is a again a classical case of greedy promoters who are asking for more than their  worth. This a trend visible in Indian markets that as the stock markets gain momentum the promoters start flooding the capital markets with issue at a aggressive premium. I strongly believe that market regulators should do something about it in the interest of at least retail investors.

Coming back to Jindal cotex, the company is asking investors to invest at a Pre issue P/E of 20.23 at lower band and 21.68 at the upper band while the Industry average is just 9.10

Investment Guru is of view that investors should give this IPO a miss.

Read More!

NHPC IPO Allotment Status & Listing Strategy

nhpclogo NHPC IPO allotment status is out. Click Here to check your application status. NHPC IPO got overwhelming response similar to that of Adani power. The IPO got subscribed 23.5 times with retail segment subscribed by around 3.8 times. NHPC basis of allotment can be seen in table below. Though both Adani and NHPC IPO’s have generated tremendous response from the QIB segment, the retail oversubscription has been moderate and shows that IPO investors are still shy in applying for the IPO’s.

nhpc boa

The lukewarm or say powerless listing of Adani power has actually validated the fears of retail Investors. Both Adani and NHPC IPO’s were considered to be priced aggressively and Adani stock has already been punished. Now is it turn of NHPC IPO ? Let’s see. NHPC stock is expected to list in first week of September.

Government has fixed NHPC offer price at Rs. 36 per share, i.e., on the higher band of the offer price. Prior to listing of Adani power, the Grey market premium of NHPC was quoting at Rs. 12-14 per share. However, the latest grey market premium is in the range of Rs. 4-5 which shows that listing for NHPC might be lackluster.

NHPC is the largest Hydro power generator in the country with substantial experience in design, development, execution and operation of Hydro-Electric Projects (HEP). The company has 13 HEP plants in operation with an installed capacity of 5,175 MW. It is currently undertaking construction of 11 HEP plants with a total installed capacity of 4,622 MW and 8 of these projects totaling 1492 MW are scheduled for completion by the year 2011-12. NHPC generated 16,582 Million Units (MUs) in 2008-09 as against 14,811 MUs in 2007-08.

On consolidated basis, NHPC reported an Operating Income (OI) of Rs 34.94 billion and Profit After Tax (PAT - excluding minority interest) of Rs 12.44 billion in 2008-09 as against an OI of Rs 29.31 billion and PAT of Rs 12.07 billion in 2007-08.

NHPC’s projects are located in India’s Northern and North-Eastern regions, which have favorable hydro resources, thereby ensuring sufficient water availability for power generation. There has been comparison between NTPC and NHPC over the valuations but one clear advantage that NHPC has is that its operation does not have fuel requirement unlike NTPC which makes its operating cost very competitive.

Another advantage of NHPC is that not only are its plants located in High energy deficit areas which ensures consistent demand, NHPC sale of Electricity is backed by LC’s from banks which can be used in case of delay in payments. Further, it is supported by a tripartite agreement between the customer state,RBI and GoI, whereby NHPC can recover the payments from the central plan assistance given to the state by GoI. As a result of these measures, NHPC, for the last few years has reported almost 100% collections against the billing to the respective states.

On the Risk aspects, NHPC projects have long gestation period and hence the the proposed projects would start operating only from 2010-11 onwards. Talking of the Financials, NHPC ROCE stands at 10.18% and RONW stands at just 6.58% due to its large equity base.

Investment Guru’s overall assessment is that NHPC is a stock which may provide good returns over long term (2 Years time frame) based on its fundamentals. The stock may list in the range of Rs. 39-42 and may remain in this range from short term perspective.

Update: NHPC is going to list on NSE and BSE on Tuesday, 1st September,2009

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File your ITR-V form till 30th September,2009

The Income Tax department has extended the time limit for filing of ITR-V form.  The ITR-V form relating to returns which have been filed electronically (without digital signature) on or after 1st April, 2009 can now be filed on or before the 30th September, 2009 or within a period of 60 days of uploading of the electronic return data, whichever is later.

The ITR-V should continue to be sent by ordinary post to Post Bag No.1, Electronic City Post Office, Bengaluru, Karnataka-560100.

To assist taxpayers, a limited call center service with two agents has been established at ITD-CPC, Bengaluru. Taxpayer queries on status of ITR-V receipt at CPC, Bengaluru will be answered on 080-43456700 between 9:30 AM to 6 PM between Monday to Friday. The service will be available in English, Hindi and Kannada.

 

Check your E-filing Processing Status online

If you have e-filed your Income tax return and have already submitted the ITR-V through ordinary post, you might be interested in checking the status of your e-filing. Now you can login in to your account on Income Tax department website and check the status of your filing.

Go to https://incometaxindiaefiling.gov.in/portal/index.jsp

Log ton to your account using your PAN No. and password.

Once you log in Go to “ MY Accounts”

In “My Accounts” you will find a option of “E-Filing Processing Status”…Click this.

e-file

Now enter your E-filing Acknowledgement number (This can be found from the ITR-V form that was generated when you uploaded your return online. A copy of the same was also sent to the email Id mentioned in your return) and Assessment Year to get the status of your ITR-V form.

 

You can also call up  the Call center numbers given above to find status of your ITR-V submission.

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Stock Review: South Indian Bank

siblogo

Stock : South Indian Bank

CMP: Rs 108.5    Book Value : Rs 113.76

Industry : Banking – Private Sector

 

Creation of the Swadeshi movement in India to help the business community from the clutches of greedy moneylenders, South Indian Bank has travelled a long distance in converging itself to a next generation banking destination.

Investment Guru is of the view that South Indian Bank is a good buy from short term as well as medium to long term perspective.

  • SIB has put up a good show on a consistent basis. The advances have grown from Rs 5300 Crore  to 11800 Crore in last 4 years.
  • Interest Income has grown at a CAGR of 33.5% over the period of last 4 years.
  • SIB has also shown consistent growth in net profits with a CAGR of 100% over last 3 years.
  • The stock offers an attractive dividend yield 2.78% in addition to growth prospects which creates a good combination for investors.
  • SIB commands strong brand loyalty among its NRI customers.
  • With EPS of 19.14 the stock is currently quoting at a Price to Book Value of 0.95 and a PE of 5.64 which shows that the stock has a strong potential to move up based on its recent performance as compared to its peers which are quoting between PE multiples of  8 to as high as 35.
  • The Q1’09 results of the bank were encouraging with bank reporting 60 Crore Net profit and quarterly EPS of 5.32. Net NPA’s fell to 0.39% as compared to 0.49% recorded in Q1’08.
  • FII’s hold 36.22% stake in the company as compared to 42.7% last year. However, there is no promoter holding which is partly a reason for comparative lower valuations assigned to the bank. On the other hand, this makes it a hostile takeover target and provides investor a possibility of windfall gains if that happens.
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ASBA- Welcome step for IPO Investors

Gone are the days when IPO investors had to worry about getting back their refunds in time and loosing on the interest income for the money they invested in the IPO during the period from application to getting back the refund. SEBI has introduced the mechanism of ASBA which would act as a right step in providing relief to the IPO investors from worries of delay in refunds and loss of interest income.

 

What is ASBA ?

asba ASBA means “Application Supported by Blocked amount”. ASBA is an application containing an authorization to block the application money in the bank account, for subscribing to an issue. If an investor is applying through ASBA, his application money shall be debited from the bank account only if his/her application is selected for allotment after the basis of allotment is finalized, or the issue is withdrawn/failed.

To put it in more simpler words, when you apply for an IPO now,  you don’t have to pay the amount upfront. You just give an instruction to the bank to block the amount in your bank account to the extent of your application amount. So you don’t pay anything to the company. The application amount remains in your bank account and you continue to earn interest on it . The hold will be released once the allotment is made by the company. If you have got allotment, the amount to the extent of shares allotted would be debited to your account and the hold on balance of amount would be released. You cannot withdraw the amount of money blocked against an IPO application till the blocked amount is released on allotment/refund.

Currently the facility is available only to IPO’s with Book Building route. SEBI has issued a list of Self Certified Syndicate Banks (SCSB) who are authorized to accept ASAB application forms. Currently 10 banks have enrolled for providing this facility. Others are expected to enroll soon.

For those who apply for IPO through Online trading and their Banks are classified as SCSB, the option of applying through ASBA has been activated by default so you don’t need to take any additional steps.

Detailed Guideline from SEBI

List of SCSB’s

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NBCC offers affordable flats around NCR for 6.75 Lac

Are you looking for a One bedroom flat with Balcony, Tiled flooring in living & Bed rooms, Kitchen with ceramic walls and brass fittings and all these at a price of 6.75 Lac ? NBCC has launched the “NBCC town” to materialize your dreams.
nbcc logo After Tata Housing, its the turn of National Buildings Construction Corporation(NBCC) Limited to launch affordable housing scheme. NBCC has launched “NBCC Town”  scheme at Khekra on Delhi – Sharanpur  Highway. 19 Km Away from the ISBT, the flats start at a price of 6.75 Lac for One Bedroom Flat (493 Sq. ft.) at 4th Floor of Lotus  Apartments. The scheme opens from 25th August,2009.
NBCC has come up with four type of apartments. The Lotus apartments (4 Storey) will house One bedroom Flats. Lilly apartments (4 storey) will house 2 bedroom flats. Tulip Apartment (4 storey) will house 3 Bedroom and Marigold Towers (7 storey)  will also house 3 Bedroom flats but will have facility of stilt Car parking. You can check the prices of different flats on offer here.
If you are a working or retired Government / PSU Employee then you are eligible for a special discount of 5%.
nbccplan
The payment schedule and plan has also been designed in a reasonable manner. The application form is available at the NBCC Bhawan at Lodhi Road and Sector 41 Noida at a price of Rs 100.
The application form for NBCC Town can be downloaded here.
The forms are also available at designated branches of HDFC Bank, Union Bank, Corporation Bank and Axis Bank.

The costliest flat in the scheme is located at the First Floor in the Marigold Towers with an area of 1100 Sq. Ft. and is prices at 17.8 Lac for 3 Bedrooms with 2 Balconies. Car parking will cost additional 1.25 Lac for flats at Marigold Towers.
Optional Open parking space is available for other apartments at a price of Rs. 50,000.
NBCC is also going to launch 2/3/4 Bedroom flats apartment and 4/5 bedroom flats with Penthouse  at Gurgaon shortly.
Location Map of NBCC Town
Master Plan
Detailed Price Schedule

Update on 06th March,2011
List of Applicants who are eligible to apply for 'NBCC Heights' at Sector-89, Gurgoan
The Scheme is open from 25th February to 16th March, 2011
Download Application Form
Read More!

Adani Power- IPO Allotment & Listing Strategy

If you have applied for the Adani Power IPO, by now you would have become owner of this yet to be operational power generation company which is part of Adani Group. Check Allotment Status for Adani Power.

 adani_logo The Adani IPO has brought life back to the ailing primary markets. It has received tremendous response from the Qualified Institutional Buyers who have shown huge apatite for the stock. The QIB portion was subscribed more than 39 times. The Retail Investor segment got oversubscribed by just 3 times. A similar pattern was also seen in NHPC IPO. This trend shows that retail investor has still not come out openly and is still licking the old wounds caused by turmoil in stock markets as well as dismal performance of IPO’s. However, on a positive note it shows that the interest in primary markets is building back and it speaks of better prospects for the upcoming issues.

adani basis ipo

Another thing which was quite evident from the subscription pattern was that the investing community rates India as a good investment opportunity and in particular the pace at which  infrastructure reforms are expected to take place has aroused significant interest in Power sector. In India the generation of power is far less than the demand which is estimated to rise at  a far greater rate than in last 5 years.

According to the 17th Electric Power Survey, India’s peak demand will reach approximately 152,746 MW with an energy requirement of approximately 968 billion units by fiscal year 2012. By the fiscal year 2017, peak demand is expected to reach 218,209 MW with an energy requirement of 1,392 billion units. Currently we have a Peak Availability of just 97,669 MW. This shows the tremendous scope available to companies in power sector.

 

Listing Strategy for Adani Power

The stock is expected to list on August 20th,2009. We have been hearing a lot about overpricing of the IPO by the Adani’s. Whether the issue was overpriced or not will be finally decided by the markets. The company has not started operations yet and hence doesn’t have any earnings data.  At Rs 100 per share the company would quote at a Price to Book Value of 2.8. NTPC, an existing profit making company is currently priced at 2.8 times its Book Value. This shows that Adani Power has been priced aggressively. However, one should remember the fact that Adani has certain impressive operational advantages such as location of projects in areas where peak time shortages is maximum, leverage of  presence of Adani group in Coal mining, Shipping as well as power trading.

From a long term prospective the stock looks very promising. However from the current perspective the stock is priced aggressively. The current grey market premium is ruling at  Rs. 8-10. The stock is expected to list in the range of  Rs 110-115 and may go up or down depending on the buying by the QIB’s to cover for the shortfall in allotment.  Investment Guru is of the view that Investors may book profits at a price above Rs 115 and take advantage of listing euphoria. Long term Investors can re-enter the stock at lower levels once the listing sensation is over.

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New Tax Code 2009 : Rewiring the Taxman

New Code aims to make tax laws and rates, Tax payer Friendly

taxfriendly I was recently discussing with a group of friends that the Indian tax rates structure needs a definite shift if the government wants voluntary compliance of tax laws and wants to increase the number of tax payers in the country. One of the discussion points was that government should introduce single tax rate of say 10% on the taxable income for individual tax payers and should do away with so many slabs and deductions. One suggestion was that income beyond 5 Lac should be taxed at 10% with no rebates or deductions whatsoever.

And here comes the New Direct Tax Code Bill, 2009  which attempts to simplify the lives of the tax payers.  Though the bill does not fulfill the wish-list of our discussion, it is surely a step towards providing a more tax-payer  friendly and simplified tax structure.

Following are the brief highlights of the New Direct tax code Bill,2009

  • The objective of the new tax code is to establish an efficient , effective and equitable direct tax structure in the country.
  • All direct taxes like Income Tax, Dividend distribution tax (DDT), Fringe benefit tax (FBT) and Wealth tax will be covered under this single tax code.
  • New Tax Rates will be applicable w.e.f. Financial year 2011 as under

newtaxrate1

newtaxrate2

newtaxrate3

  • Savings will now be taxed on EET basis. This means that Savings when done under designated schemes would be exempt from tax in the year the saving is done (First ‘E”). It will continue to be exempted together with the accumulations/accretions till the time they remain invested (that means till they are not withdrawn, this is Second ‘E’). The savings will be taxable at normal tax rates in the year in which withdrawal is made (this is ‘T’).
  • However, accumulated balances as on 31st March,2011 in the Provident Fund will not be taxed.
  • Deduction on account of savings has been increased from current 1 Lac to 3 Lac. However, since the new code doesn’t mention deduction in respect of Housing loan, the same may go.
  • Dividends will continue to remain tax free in the hands of Investors.
  • Capital Gains would now be taxed as income. The concept of short term and long term capital gains has been removed from tax perspective. Indexation benefit would be available on asset held for more than one year.
  • The indexation base has been changed from 1981 to 2000.
  • Since all capital gains are now taxed, Securities Transaction Tax (STT) has been abolished under the new tax code.
  • Salary received in form of perks, perquisite, LTA, Rent free accommodation, Medical reimbursement will now form part of Income and will be taxable.
  • Wealth Tax has been Re-introduced. Net Wealth in excess of Rs. 50 Crore  will be taxed @0.25%
  • In addition to deduction of Rs 3 Lac for notified savings schemes, Rs 15,000 deduction will be available for Medical Insurance Premium for self and family , and another Rs 15000 for parents. Up to Rs 50,000 can be claimed as deduction for treatment of disabled dependant , Rs 40,000 for prescribed diseases. Rs. 50,000 deduction would be available to handicapped and Rs 75000 for person with severe disability.

The New tax code is in discussion stage. You can give your comments and suggestions on the same by writing an email to directtaxescode-rev@nic.in

Keep a watch on this blog for posts related to implications of new tax code.

Download Discussion Paper

Download Direct Taxes Code Bill, 2009

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Markets set to cheer UPA Victory, expect Spectacular opening

sensex The Results of General Assembly elections might have taken even the pundits of politics by surprise, however even a layman can tell you that markets are going to sky rocket on Monday. Yes, predicting Monday’s market opening is not a rocket science anymore. After a gap of 25 years, the Indian voters have been able to give a clear mandate to a single party to form a government and markets could not have wished better than this.

A 800-1000 Points gap up Opening Possible

Markets have built in an expectation of hung assembly and have been caught on a wrong footing! It is very likely that there will be mad rush of traders, who built on hopes of hung assembly and taken significant short positions, to cover up their trades and this may push sensex intraday rise in the range of 800-1000 points. Investors are advised to be cautious and not to buy shares on Monday for Investment purposes and wait for the euphoria to die down. However, traders can make a killing as the markets turn volatile.

I see these results as an opportunity for the markets to cheer up as the stable government would be able to take up reforms at a much better pace as compared to last 5 years since communist would not be seen in the new parliament. After the news of Global Recession, there was no major reason for markets to hold up and hence they are not likely to miss this opportunity.

FII’s are also expected to speed up their investments since they have more clarity on the political front. Domestic Investors and Mutual funds are also expected to jump on the bandwagon.

Which Stocks likely to move up?

Virtually every stock on Nifty is expected to move up since this would be a secular and broad based rally. However more focus will be on stocks which fall under sectors where the UPA government is going to focus as a part of its Manifesto.

The UPA Manifesto has out emphasis on Rural Development Schemes and Infrastructural development projects. Hence Stock of companies related to Agricultural products like irrigation and Fertilisers are set to catch fire. Keep an eye on Stocks like Nagarjuna Fertilisers and Jain irrigation. Infrastructure related companies in field of Power, Cement and Construction will also see a significant catch up. Keep a watch on stocks like ACC, GVK Power & BHEL .

Congress Manifesto also provides thrust on Education. With this stock like Educomp Solutions and Aptech are likely to remain in Limelight.

Another segment likely to fire up will be banks. Rumors are that the government may soon announce another stimulus package to drive further liquidity in the markets and decisions can be taken on revising the Bank Rates. Keep an eye on stocks like PNB and SBI and HDFC Bank.

Besides the Manifesto, the Ruling party is also expected to bring back on track its program of disinvestment in PSU companies. This had hit roadblock due to strong resistance from Left parties. Though this may not be on immediate agenda of the government, it would pave the way for Re-rating of the PSU stocks.

How long will this Rally continue ?

This a hard nut to crack. Though the new strong government has given a reason for sensex to rejoice, it would at best be a short term stimulus. The fact is that the Global economy is still in the clutches of recessionary forces created by its ill-doings. India being a open economy cannot escape the burnt. However, the First quarter result has not been as bad as thought of. This shows that the impact of slowdown in India (caused by global recession) would be lesser than perceived.

The best thing India and its government did was to get proactive in dealing with the situation. This is the difference between U.S. and India. They woke up only after ruining themselves while we were proactive enough to take steps to combat the slowdown. This may led us to believe that the worst is behind us and sensex may not retest its earlier lows. However, a lot depends on the global scenario in the coming quarters and any adverse development may well leave scars on our markets too.

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Verdict Out : Indians prefer Weak PM to Communal PM

Historical verdict shows Indians voted for Development and stability

 incThe India’s political theatre has come out with an unprecedented show of results. Though the final results are yet to be declared, the leads show that Congress and its allies have managed to secure a astounding victory over the BJP led alliance by a huge margin. The red Flag of Left has been teared to pieces. The political blackmailers like SP and RJD have been shown the exit door. The election results have given a clear indication that Indian public wanted a government who can take the country forward to the path of progress and prosperity while maintaining stability and peace and the mandate has been clearly in favor of congress. BJP was unable to impress the public with its campaign of a determined leader in the form of LK Advani.

The Weak PM Campaign Backfired on BJP

The PM-in-waiting Mr. Advani has made it a major propaganda that Man Mohan Singh was the weakest Prime minster India ever had. However, this message didn’t went well among the voters. Advani’s main election plank of a weak PM actually Backfired on him and I feel this one factor itself did a huge damage to the party’s prospects. Why ?

Manmohan Singh’s image as a politician is of a very clean, Honest and a intelligent person. To put it more clearly , the work done Mannohan singh as a finance minster in the Narashima Rao government still lies deep rooted in the minds of the people. If you ask me , I would say that he is one person whose image of a clean and honest person and a person who has transformed the country’s fortune by his visionary economic wisdom is unparalleled even if you combine the intellectual wisdom all all the leaders of BJP.

Indian voters rejected Advani’s plea that Manmohan singh was a weak prime minister and this time they have made sure that he can emerge even more stronger.

Rahul Gandhi’s Acceptance among the Youth of India

rahul Rahul Gandhi was successful in projecting himself as a leader who is capable of representing the youth of India. The charisma of Gandhi family, Rahul’s handling of the election campaign and his show of emotional attachment to the villages of India and the poor & backward people worked really well and transformed into a huge success of party not only in the written off state of U.P., but also helped it clinch a large number of seats due to acceptable of Rahul Gandhi among the youth’s. Rahul has definitely emerged as the youth icon of India and has established a place in their hearts.

People want development and not Temples

Every time elections happen, BJP starts its old tune of Jai Shree Ram and its promise of construction of Lord Ram’s Temple. This time also the party repeated its rhetoric but the Indian voters have made up their mind. They had enough of these slogan to arouse their religious sentiments for generating votes and have made up their mind that Ram Mandir should not be the criteria of choosing a party to lead the nation. They wanted a government who can make their lives better and work on developmental issues.

BJP didn’t offered a Unique Proposition

The lack of unity among the second rung leaders in BJP was clearly visible and the party didn’t offered any unique proposition to the public to vote for them. L K Advani could not impress the public with his promise of a determined leadership to the country. He proved too weak to steer the party on its own and projections of people like Narendra Modi as a future prime minister also proved self destructive to party’s image among the voters.

To summarize the election outcome, the Indian public has placed its trust on the performance of the UPA government and wants it to continue to take the nation on the path of development and prosperity. The task on hand is for sure a litmus test for the UPA and the expectation levels have gone up for sure.

Coming Next : Impact of Election results on Stock Markets

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Mhada Lottery draw to be held on 19th May

[Mhada1[4].jpg]The fate of lacs of applicants for the allotment of 3863 Flats under Mhada Scheme is soon going to be decided. Mhada is going to held a draw  by lottery to declare the successful applicants on Tuesday, 19th May,2009.

Around 4.35 Lac applicants are trying their luck to get a pie of the 3863 flats. Out of these, 5300 applications have been rejected due to lack of documentation. The list of applicants who are eligible to participate in the draw has been put on the Mhada Website. The lottery draw will be held at Rangsharada Auditorium at Bandra (W)

If you want to witness the lottery process, Mhada will distribute free passes on First cum first serve basis between 11-2 PM at the Mhada Head-office at Bandra (E). Results will also be displayed outside the Auditorium on the LED Screen.

The whole process of lottery would be video recorded to ensure transparency

List of Eligible Applicants

Mhada Circular on Lottery Results

Related Posts

MHADA offers 3683 Flats at 50% of Market Price

Update : To view the list of persons qualified for the lottery of 3863 tenements to be held on 19th May 2009, click on the respective scheme code below

190A 203 214 223 232
191A 206 215 224 233
192A 207 216 225 234
193A 208 217 226 235
195A 209 218 227 236
196A 210 219 228 237
200 211 220 229  
201 212 221 230  
202 213 222 231  
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Shubh Griha- Application Form and Details

shubh_griha_logo Details are now available on the Tata Housing Website for “Shubh Griha” township. Application forms will be available from Monday May 11th,2009 at select branches of SBI.

Expected Date of Allotment : 29th June,2009

Expected Date of Possession: May 14th, 2011

Forms will be available at Boisar, Virar, Vasai, Palghar, Nallasopara,Dahanu Road, Thane, Borivali(W), Andheri East branches of SBI. For details and address of the branches click the link below

List of  SBI branches where forms will be available from 11th May 2009

In addition the forms would also be available at the Fort Regional Office of Tata Housing.

Salient features of Shubh Griha

  • Two types of Flats are available –
    • One Room and Kitchen
    • One Room, Hall & Kitchen

 

  • The Township will provide amenities like School, Playground,Community Center, Shopping Center, Jogging Track and Hospital.

 

  • The structure will be Ground Floor + 2 Additional Floors, hence it will three Floor apartments.

 

  • All Rooms and Kitchen will have Ceramic Tiles flooring. Living room will have Oil bound distemper.

 

  • Bedroom and Kitchen will have Overhead Storage space.

 

  • Flats will be handed over with premium quality bathroom fittings and sufficient Electric fittings.

Types of Flats

1 BHK - 465 Sq. Ft.                   No. of Flats 660   Price : Rs. 6,74,250    See Flat Plan

1 RK Large - 360 Sq. Ft.           No. of Flats 474   Price : Rs. 5,04,000    See Flat Plan

1 RK Small - 283 Sq. Ft.           No. of Flats 108   Price : Rs. 3,90,540    See Flat Plan

Payment Plan

  • Rs. 10,000 have to be deposited with the Application form.
  • 7.5% –8.5% (depending on type of flat) of the amount to be deposited within 15 days of allotment letter
  • 85% of the amount to given in 7 Quarterly Installments starting from September,2009
  • Balance 5% to be deposited at the time of Possession.

For Detailed payment plan click here

Shubh Griha Website

Update: Application forms are also available at Regional Offices at Kolkata, Delhi, Bangalore and Chandigarh.

Related Posts

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Stocks in News: MIC Electronics, Aptech, Godrej Industries

MIC Electronics

Investment major Fidelity has bought 20.3 Lac shares of MIC Electronics at a average price of Rs. 28.99. Hyderabad based MIC Electronics is a global leader in the design, development & manufacturing of LED Video Displays, high-end Electronic and Telecommunication equipment and development of Telecom software. The company has recently launched High Efficiency Solar LED. At the current market price of Rs. 30, the stock trades at a Price to Book value of 1.33 and a PE Multiple of 3.94 with Industry PE at 8.87.

APTECH

India’s most well known Investor Rakesh Jhunjhunwala has bought 10 Lac Shares of Aptech at a price of Rs. 113. Prior to this Rakesh has bought 5 Lac Shares of Aptech on 19th December,2008 at a price of Rs. 81. Rakesh Jhunjhunwala also holds the position of Chairman in Aptech Ltd. Aptech Limited is a global retail & corporate training solutions provider headquartered in Mumbai, India, with a presence across 5 continents. The company commenced its IT training business in 1986. Over the years, Aptech Limited has trained over 5 million students. At the Current Market Price of 113 the stock quotes at a Price to Book Value of 3.93 and a PE of 110.49 against the Industry PE of 39.

Godrej Industries

The stock price zoomed after the announcement of Buy-Back offer by the company of 57 Lac shares at a price not exceeding Rs. 275 per share. The stock is currently quoting at  Rs.101 and has gained around 30% in last few days. At Current price the stock carries a Price to Book Value of 3.12 and PE multiple of 114 against industry PE of 23.95.

Godrej Industries Limited is India's leading manufacturer of oleo chemicals and makes more than a hundred chemicals for use in over two dozen industries. It also manufactures edible oils, vanaspati and bakery fats. Besides, it operates real estate. GIL operates two plants, one at Valia in the Indian state of Gujarat and a second at Vikhroli in suburban Mumbai. The company's products are exported to 40 countries in North and South America, Asia, Europe, Australia and Africa, and it leads the Indian market in the production of fatty acids, fatty alcohols and AOS.

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Tata Housing to launch Sub Rs. 4 Lac Flats

Launches Subha Griha project in Boisar near Mumbai

flat Here comes another low cost offering from the Tata Stable. After the launch of the world’s cheapest car Nano, the Tata’s has unveiled its ambitious project “SUBHA GRIHA” which aims to provide low cost affordable housing in Suburbs of Mumbai.

Booking starts from May11,2009 and forms would be available for Rs. 200. Allotment would be made on basis of Lottery draw.

  • The township will be located in Boisar, which is at a distance of about 100 Kms. from Mumbai

  • The township will consist of 1200 One Room Kitchen Flats starting at Rs. 3.91 Lacs

  • The construction is expected to be completed in 24 Months time.

  • The project is targeted to address housing problems of migrants who currently opt for rented accommodation

  • The project would offer community Halls, School and Hospital within the township.

  • There will a range of options available and the flats could cost between 3.91- 7 Lacs depending on specifications

  • The company proposes to put a “No sale Clause” for a period of Nine months from the date of allotment to curb speculative sale purchase of these flats.
About Boisar

Boisar is a town in Thane district in the state of Maharashtra. It is located 45 kms (28 miles) north of Virar on the Western Railway line of Mumbai Suburban Railway. By Road, it can be reached from National Highway NH-8, {{convert22kmmi} off from Chilhar Phata. There are regular state transport buses from Palghar, Thane, Bhiwandi and Wada.

Subha Griha Project in Delhi & Bangalore

Tata Housing has intends to launch the affordable flats scheme in NCR and Bangalore in this year itself. It will launch this Scheme in other major cities including Chennai and Kolkata in the coming years.

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Yamuna Expressway : Residential Plots Scheme 2009

YEIDA Scheme Extended till 15th May,2009

(This article has been further updated on 4th October,2009 )

The notice says that the Scheme has been extended till 15th May,2009 due to demand from Public. However, things don’t look that rosy. The Scheme has not been able to muster good response from investors as expected by the Yamuna Expressway Authority (previously known as Taj Express Way).

About Yamuna Expressway Residential Plot Scheme

These residential plots will be developed along under construction Noida-to-Agra Yamuna Expressway. The proposed site / sector is about five minutes drive from the proposed Formula One Racetrack . The land on which the plots would be developed is under the process of acquisition.

Details of Plots is as under

CategorySize (Sq. Mtr)No. of PlotsGen. Cat.Farmer Cat.Registration Amount
A400010083175,00,000
B2000250206443,00,000
C100010008251752,50,000
D500200016503502,00,000
E300500041258751,00,000

The rate of the land of the residential plots under this scheme is Rs. 4,750 per sq. mtr. The tentative date of draw is 10th August,2009.

Why did the Scheme failed in getting Response ?
  • With the current downtrend in Real estate prices, investors are worried about the returns from the Scheme

  • The Rate of Rs. 4,750 per Sq. Mtr. is considered to be aggressive given that the Scheme may take at least 8-10 years to develop.

  • Investors have doubts about the progress on the proposed Noida - Agra Expressway itself and any dealy on this project would also delay development under the Scheme.

  • The Agra Noida area is more prone to petty crimes and hence reduce the attractiveness of the scheme from Safety point of view.

Update on YEIDA Residential Scheme 2009 Draw

As per the Public Notice issued by the Yamuna Expressway Industrial Development Authority, the draw for YEIDA residential Scheme 2009(1) will be held on 14th October,2009 and 17th November,2009.

  • Draw for All Types (A,B,C,D & E) of Farmer Categories of Plot and General Category A-4000 Sq. Mtr, B-2000 Sq. Mtr. and C-1000 Sq. Mtr. will be held on 14th October,2009 at Community Center, Sector Delta-II Greater Noida at 10:00 AM. This will be a Manual Draw.
  • Draw for Category D-500 Sq. Mtr. and Category E-300 Sq. Mtr. will be held on 17th November,2009 at India Expo Mart, Greater Noida at 10:00AM. This will be a computerised draw.

Details of Eligible Applicants (whose application will be considered for draw) will be posted on the YEIDA Website from 5th October,2009. Click here to check your Application Status.

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50 Stocks out of Futures & Options Segment

SEBI has initiated changes in Eligibility criteria for inclusion of stocks in future and options segment.

Now a Stock has to fulfill following criteria to be included in the F&O Segment

  • The stock shall be chosen from amongst the top 500 stocks in terms of average daily market capitalization and average daily traded value in the previous six months on a rolling basis.

 

  • The stock’s median quarter sigma order size over the last six months shall be not less than Rs. 5 lakhs.

 

  • The market wide position limit (MWPL) in the stock shall not be less than Rs. 100 crores.

A stock will be excluded from F&O on the basis of following criteria

  • The Market wide position limit in the stock falls below Rs. 60 Crores and if Stock’s median quarter-sigma order size over the last six months is less than Rs. 2 Lacs for a period of continuous three months.

Further, once the stock is excluded from the F&O list, it shall not be considered for re-inclusion for a period of one year.

Based on the above criteria, the stock exchanges have issued a circular effective from 4th May,2009 excluding 50 stocks from F&O Segments. The existing unexpired contracts for the month of and April, May and June 2009 would continue to be available for trading till their respective expiry and new strikes would also be introduced in these existing contract months.

Prominent stocks excluded from F&O segment include 3i Infotech, Alok Industries, Aptech Limited, Gitanjali Gems, Jet Airways, NDTV, Rajesh Exports, Karnataka Bank, Amtek Auto, GNFC, Thermax, Hindustan Oil Exploration, RIIL and Wockhardt

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Q4 Results Update

TCS Q4 Net down 2.1% Revenues down 1.5%, declares 1:1 Bonus

tata_logo TCS has reported a Full year Revenue of 27812 Crores and Net Profit of 5256 Crores. The profits were up 4.5 % and Sales were up 21.6% against last year. The Board has also approved issue of 1Bonus share for each share held in the company. The company has also declared a final dividend of Rs. 5 per share. The total employee strength of the company is 143,761. The forex losses stood at Rs. 781 Crores. The Company had a Cash of Rs 4300 Crores on its Balance Sheet as of 31st March,2009.  The EPS for FY09 stood at Rs. 52.85. The TCS results look good considering the fact that the company had a hit of 781 Crores on account of forex losses.

TCS’ full services strategy significantly contributed to overall company performance.  BPO and Infrastructure services grew by more than 40% compared to FY08. Demand for core IT and ADM services remained strong, with more than 50% of the large deals in FY09 coming in this space. Engineering services grew through FY09, though ongoing pressure in the US Auto and Hi Tech industry could adversely affect demand in FY10.

TCS Result Highlights

Sesa Goa Q4 Net profit down 33%

sesa Company posted Q4 Revenues of 1430 Crores Vs 1681 last year. Net profit was down at 548 crores Vs 812 crores last year. For the Full year, the company posted Revenues of 4926 Crores Vs. 3766 Crores last year and net Profit at 1988 Crores Vs 1542 Crores. The company’s FY09 EPS stood at Rs. 25.26

Sesa Goa Result Highlights

Axis Bank net zooms 61% Interest Income up 25%

logo-axis Good set of numbers posted by Axis Bank. Net profit for Q4 zoomed 61 % to Rs. 581 Crores. Net Interest income shot up 25% to 1032 .6 Crores while the Fee based Income grew 42% to touch 664 Crores. Demand deposits have grown 26.52% yoy, and constitute 43% of the total deposits, with Savings Bank deposits having grown 29% yoy and Current Account deposits having grown 24% yoy. The Net NPAs, as a proportion of net customer assets, have reduced to 0.35% from 0.36% at the end of the preceding year and declined from 0.39% at the end of December’08. The Bank’s Capital Adequacy Ratio was 13.69% as at end March’09 as compared to 13.73% as at end March’08.

Bank’s FY09 EPS stood at Rs. 50.27 against 31.31 last year. The Board has proposed 100% dividend.

Axis Bank Result Highlights

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Infosys Results & Guidance indicate tough road ahead

Infosys has declared the Q4 Results.

  • Q4 FY09 net profit dipped 1.7% at Rs 1,613 crore as against Rs 1,641 crore on quarter-on-quarter basis.
  • Revenue declined by 2.61% at Rs 5,635 crore as against Rs 5,786 crore QoQ.
  • Consolidated net sales for FY09 at Rs 21,693 crore versus Rs 16,692 crore (a jump of 30%) and increase of 28.5% in Consolidated net profit at Rs 5,988 crore versus Rs 4,659 crore.
  • Infosys has recommended a final dividend of Rs 13.5/share.
  • Top client revenues for the quarter ended March 2009 declined by 12.06% QoQ
  • Top 10 client revenues declined by 5.75% QoQ

These are highlights of Q4 Results. Now lets look at how the future appears to the Infosys management

  • Q1 Revenue forecast at Rs. 5,379-5,480 crore.
  • Q1 EPS seen at Rs. 23.55
  • FY10 revenues to decline by 3.1-6.7% in dollar terms while increase in revenues by 1.7-5.7% in rupee terms
  • EPS for full year FY10 at Rs 96.65-101.18 a share versus Rs 104.43 in FY09

What does Infosys result indicates?

Slowdown in Revenue Growth Evident

A drop in Revenues for the company which had made it a habit to surprise investors with superior financials is a clear indicator of things to come. Further the guidance for Q1 FY10 and Full year predicts a challenging environment both in terms of pricing as well as new business. Top 10 client revenues saw a sharp decline which means that there will be tremendous pressure on billing rates in the days to come.

Infosys results are a clear indicator of drastic cut by companies on their IT spend. Obviously, when things are in pretty bad shape due to ongoing recessionary trends, companies would tend to cut down on their IT investments to maintain their bottom lines. Similar and more downtrend would be visible in the revenues of other IT companies.

Cost Optimization would be crucial

In a scenario where a company is not able to grow its revenues, it becomes imperative to cut down on the operating costs to generate profits. This would be visible not only in the IT companies, but across the sectors as the pressure to preserve margin mounts. As a result, we would see major Headcount reductions being announced by companies more particularly in IT sector as headcount is a major cost factor.

Is Revenue segmentation a Indicator ?

If we see change in Revenue Segment by Industry, it gives at least an indication of the broad environment of that industry. The sharpest drop in Infosys Revenue came from Financial Services and Manufacturing Industry Clients. This indicates that these industry are facing serious challenges and hence cutting on their IT spend. The Revenues from Telecom sector has increased conforming that this industry has not been impacted in a major way by the ongoing slowdown.

As the results season starts, we would need to see how Indian companies performed in the Q4. There are no high expectation this time around and if a company reports QoQ growth that would be a good indication of companies performance. I personally feel that Infosys results and guidance are reasonably good considering the severe drop in consumption and negative sentiments globally. The companies stock at Rs. 1400 looks reasonably priced and don’t see much movement on either side due to the results.

Resources

Highlights of Infosys Q4 results

Infosys Investor Presentation Download

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Tech Mahindra wins bid for Satyam Computers

tech mahindra Tech Mahindra has won the bid to acquire 31% stake in Satyam Computers. Tech Mahindra was the highest bidder with a price tag of Rs. 58 per share  against L&T’s bid at Rs. 49.50 per share. The deal is subject to statutory clearances from Sebi and the Company Law Board (CLB).

L&T already has 12& stake in the company as is currently not interested in divesting its stake.

Tech Mahindra will have to pay Rs 1757 crore (USD 351 million) for 31% at Rs 58 per share, whereas for the total 51% stake the company will have to pay Rs 2,890 crore. The company will make an open offer at Rs 58 per share.

The real Impact of the deal on Tech Mahindra would evolve in the days to come as it aligns the maligned Software firm’s business within its frame of operations and makes sure that clients do not move away from it. The impact of litigation related to Satyam fraud would also be a challenge for the company.

Intense trading activity was witnessed on Satyam Computer counter as the stock zoomed as high as 18% at the time of announcement, just to cool down later. More than 13 Crore shares of Satyam computers were traded. Tech Mahindra stock price also jumped by more than 12% post the announcement.

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Stock Review : Gitanjali Gems

gitanjaligems Stock : Gitanjali Gems

CMP: 65.85

Industry: Jewellery, Diamond, Retail & Lifestyle

Book Value Per Share : 209.58

EPS : 16.92

Market Cap: 560.14

What makes Gitanjali an attractive Investment ?

  • The stock is currently quoting at 0.31 times its Book Value.
  • Current EPS of 16.92 coverts into PE multiple of 3.89 which is significantly lower than Industry average of 5.1 considering strong brand presence of the company
  • The stock also Offers a Dividend Yield of 2.73% in addition to attractive valuation.
  • India continues to be one of the world’s largest consumer market for Jewellery and Gold.
  • India and China are considered to be fastest growing consumer market for diamond jewellery and this provides Gitanjali a reasonable offset to ongoing recession in world’s major economies.
  • Diamond jewellery is fast emerging as new social trend leaving behind old preference for plain Gold Jewellery.
  • The company’s foray into Infrastructure (primarily Gems and Jewellery SEZ’s), Lifestyle Products such as Watches and fashion accessories would offer diversified sources of Revenue to the company.
  • The company has aggressively followed its strategy of growth with acquisition which has helped it to expand its distributional capabilities.
  • The company has a healthy mix of income from Exports as well Domestic segments.

Risk Factors

  • US is the largest consumer of retail diamond jewellery (48% of world’s consumption) and largest export market for gems and jewellery for India, the ongoing recession would have impact on export earnings of the company.

Latest News on Gitanjali Gems

Sebi has issued an order granting permission to the promoters of Gitanjali Gems to Buy Back 1.2 Crore shares of the company at a price up to Rs. 120 per share without making public announcement of the same. This move would increase Promoter’s stake in the company from existing 54.19% to 63.09%.

Investment Guru is of the view that the stock has good potential to move up from current level. The proposed Buy back of shares by promoters would also act as a short term trigger to the stock price.The reduction in the stock price may happen on account on general fall in market, but this risk stands good for any stock being traded in the market.

Gitanjali Gems – Detailed Info

Shareholding pattern of Gitanjali Gems

GGSP

Mutual Fund Holding Gitanjali Gems

mfgg

Financial results – Quarterly Comparison

This stock was discussed earlier on this blog here

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Tata Nano booking opens today

The People’s Car has opened the booking from April 09,2009. Last date of booking your nano car is 25th April,2009.

Price of Tata Nano in Delhi

nanoprice1

Booking Amount

Tata Nano Std.           Rs.95,000

Tata Nano CX             Rs.120,000

Tata Nano LX              Rs.140,000

Book Tata Nano ONLINE

You can book Nano online through company’s website. However, you cannot use credit or debit cards for payment of booking amount. You can use only Net Banking as a mode a payment. Click here to book Nano Online

Financing of Nano Booking amount

Canara Bank and United Bank of India emerge as good options

Tata Motors has entered into agreements with 18 preferred banks/NBFCs to enable prospective customers to get finance and facilitate booking of the car. The  lowest finance charge has been announced by Canara bank at Rs. 2850. SBI will charge 2,999 for financing the booking amount.

Those who are themselves paying the entire booking amount can submit their application forms  directly to State Bank of India through 1,350 notified branches in 850 cites, and also at Tata Motors Passenger Car dealerships, Westside and Croma outlets.

Post the successful allotment of the bookings, customers can convert their booking loan into a retail auto loan for the Tata Nano at very attractive rates with the preferred financiers. In this category United Bank of India has emerged as a best option as it offers conversion at 9% interest Loan.  Canara bank will charge 9.5% –11% depending on customer profile.

Deliveries of Nano Car to begin in July

Within 60 days of the closure of bookings on April 25th , 2009, Tata Motors will process and announce the allotment of 100,000 cars in the first phase of deliveries, through a computerized random selection procedure. These 100,000 allotments will be price protected for the launch prices till delivery of the cars but the booking amounts will not bear any interest for the customers. Deliveries will commence from July 2009.

Applicants have the option to retain their booking deposit, even if they do not get allotment in the first phase. Those who choose this option will be eligible for interest on their deposit, effective from the date of announcement of allotment of the second phase, at a rate of 8.5% for retention period between one year to two year and 8.75% for a retention period of more than 2 years. Allotment of retainees will be simultaneously communicated, along with the allotment of the first 100,000 cars.

Any Questions on Tata Nano ?

If you have any questions or queries about Tata Nano Car, I would suggest that you read the Frequently Asked Questions posted on Nano’s Website. The company has prepared Answers to a large numbers of questions that could be asked about the Car including its specifics, performance, safety, mileage, speed and a whole lot of other questions. Read the Frequently asked questions and their answers here

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Tata Motors FD Interest Rates reduced from April 16th,2009

Effective Yield on 3 years Deposit reduced from 13.5% to 11.83%

Tata Motors has announced reduction in Interest rates on its ongoing and hugely popular Fixed Deposit Scheme with effect from April 16th,2009.

Under the Quarterly Income Plan the Interest Rates on 1 year deposit has been reduced by 0.75%, on 2 Year deposit by 1% and  3 year deposit has been reduced by 1%.

Additional Interest to Senior Citizens, Tata Motors Shareholders and Employees of Tata Motors has also been reduced from 0.5% to 0.25%

Other terms and condition of the Fixed deposit scheme remains same. You can read further details about the scheme in my earlier post here.

tatafdrevised1

 

If you are a senior Citizen or Tata Motors and its subsidiaries employee or a shareholder of Tata Motors, the Effective Yield on 1 Year Deposit will be 9.84%.

Effective Yield in case of 2 Year deposit will be 10.62%

Effective Yield on 3 year deposit will be 11.83%

The effective yield on 3 year deposit will get reduced by 1.67%. Hence, if you have made up your mind to invest in Tata Motors FD scheme, it would be better if you invest before 16th April,2009.

  

  Following are the Main Brokers / Distributors for the FD’s

•Tata Securities               •ICICI Direct

•Kotak Securities             •Stock Holding Corporation of India

•JM Financial                    •HDFC Securities

Related Post : Tata Motors FD

 

Click to Download

Fixed Deposit Form                                 •ICICI Direct Branches

HDFC Bank Collection Branches              • Stock Holding Corporation of India Branches

Tata Securities Branches                        •HDFC Securities Branches

Kotak Securities Branches                      •Form 15G

JM Financial Branches                             •Form 15H

Registrars to the Fixed Deposit Scheme

LINK INTIME INDIA PVT LTD

BHANDUP : C 13, Panna lal Silk Mills Compound, LBS Marg, Bhandup (West), Mumbai 400 078. Tel: 022-2594 6960-4.

FORT : 203, Davar House, Next to Central Camera Building, 197/199 D N Road, Fort, Mumbai 400 001. Tel : 22694127.

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Investment Guru now on Twitter

tweet Catch me on twitter to get insight on my thoughts on latest trading patterns and stocks that might do well from intraday/ short term perspective. You can also find tweets on fundamentals/market updates and other misc. topics. I have found twitter as a better medium to express in a short and sweet manner as I hardly get time to update the blog frequently. I would continue to update the blog as usual.

Follow me on Twitter

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Further Pay Revision for PSU Officers

payrevision About four lakh officers of central public sector enterprises will benefit from a government decision today giving them a further increase in salary and allowances, over and above the hikes announced last year. The decision to improve the salary structure of officers at board level and below, along with supervisory staff, was taken at the Cabinet meeting presided over by Prime Minister Manmohan Singh.
The improved pay packages will also include increase in house rent allowance and retirement benefits. The decisions are based on the recommendations of the committee of ministers headed by Home Minister P Chidambaram, which went into the revised salary and allowances notified earlier in November last year by the government. PSU officers, particularly in the oil sector, forced the government to revisit their revised pay scales when they went on strike in January this year.
Briefing reporters after the Cabinet meeting, Chidambaram said the revision in the pay structure would vary from company to company. (Source : PTI News)

Stay tuned for detailed post on above.

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Withdraw Cash from any ATM from Apr.1, Free of charge

atm Thinking of changing your Bank because the ATM of that Bank is not near to your Office or Home ! Forget it , No more would you be bothered about where is the ATM of your Bank located. Come April 1st,2009 and you can withdraw money and do Balance Enquiry from any ATM irrespective of which Bank you hold you account without any charges being deducted for this service.

Earlier some banks had created their own network where ATM withdrawal of the participating bank customers was not charged. However, there was lack of awareness and clarity on these mechanisms. The customer was not aware of what charges will be deducted on using other bank’s ATM as the charges differed from one bank to another. There was a confusion among the customers as to what will be the charge for withdrawing Cash from their Bank Accounts from some other Bank’s ATM and this facility was being used by customers only in case of extreme emergencies (where charges do not matter!).

RBI had issued a circular on March10,2008 directing all Banks to not charge more than Rs. 20 with effect from March 31,2008 for use of any Bank’s ATM. The circular further mentioned that with effect from Apr1, 2009 all banks should provide these service FREE of cost to the customers.

What will still be Charged ?

Banks may still charge customer for the following Services :

a) cash withdrawal with the use of credit cards
b) cash withdrawal in an ATM located abroad.

If you are interested in reading the Notification of the RBI in this Regard, click the link below

RBI Notification for Customer Charges for Use of ATM’s for Cash Withdrawal & Balance Enquiry

Update : 22nd August ,2009

From Oct 15, only 5 'other bank ATM' transactions a month would be Free

The party is Over for bank cutomers who had been awarded the liberty of Free withdrawal from any ATM just 5 months back. Based on the demand from Indian Bank's Assocation, RBI has agreed to limit the numbers of free withdrawal from "Third Party" ATM to 5 per month. If you withdraw more than 5 times from other Bank's ATM, you may have to pay a fee ranging from Rs 12 -Rs 20 for this. However, banks have been given the liberty not to charge any fee for more than 5 transaction per month in case they wish to do so.

RBI is also limiting the amount of cash that can be withdrawn from "Other Bank's" ATM to Rs. 10,000 per transaction.

(This post has been updated on 22nd August, 2009 in view of new development which impacts the relevance of this post)

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