Weekly NEWS letter and Stocks to watch out for.

Global cues were negative so Indian markets end flat at the end of the week.
We saw inflation further cooling down. Worst results posted by few companies.
Analyst say Indian Story is still intact.
The Yellow Metal (GOLD) is making new highs , has crossed 14K.
The week ahead looks neutral with markets in range bounded behaviour.
We could see a sell off soon in the markets.
The Government has emphasized the need for further stimulus packages to boost the economic growth and sustain a healthy economy amidst the turbulence prevailing across the world.

Sector to watch out for in Short Term. -

IT - The sector in controversy is the one good to trade as there are huge movements in the stocks. Though it is risky it is rewarding.

Pharma - This an ever green sector for me as I think people wont stop having medicines in recession time.

Telecom - New news coming day over day. Airtel is now in IPTV segment. In this sector I am bullish on Airtel and Idea. RCom though is good but can go further down.

Stocks to Watch out in this week.

Educomp Solutions - The share price of Educomp fell as registrars of companies (RoCs) were asked to inspect the books of accounts of Educomp against the backdrop of media reports that the company’s profits were inflated and that promoters had made big profits by trading their own shares and diverting funds to unlisted subsidiaries.
This would be the one big stock to watch out for.

Tata Motors - Nano coming out on 3rd of March can give TATA Motors some working capital blocked in a short term. It is estimated TATA would collect Rs 700 cr within few weeks after the booking starts.

Airtel and Idea - Long term story is intact. But in short term can shoot up giving 5 - 10 % returns.

Other stocks -
Unitech
ICICI Bank.
UTV Software's.

Whats HOT this week - TATA Nano will be launched on the 3rd of March.

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Using common sense to invest for the long term

Got thinking this weekend about how should I plan my investment for the next 3-6 months. I do dabble in stocks for short term which are mostly based on news, intra-day calls from members on stockezy. But usually I am someone who likes to invest long term. This weekend over a cup of coffee made me think to visit some of the beaten down names in the commodity sector. 

Copper, Steel, may be building materials such as Cement. Let's Think Aloud together as to why this may be a good time to invest in companies like Tata Steel, ACC, Hindustan Copper, Sterlite, SesaGoa, Hindalco and other related companies. 

Materials of any type which help build & re-build the backbone infrastructure of our country such as roads, bridges, railway lines, ports, electrical grids, power stations all our going to be in demand. Now some may disagree but I have a reason for this. 

Now coming back to why I like commodities. One assumption I am making (which is also my risk quotient) is that I trust the government of India to execute moderately well in spending money allocated for the Stimulus Plan. We need for our government to invest in the country. 

• Move tenders to build roads, railways and ports, power stations
• This helps Engineering company's to get government orders
• To build you need construction materials
• To build you need heavy engineering equipments
• To build you need to employ labor, hence create employment

The government can use its cash reserves to fuel demand and growth and put the country back on its feet. At least to walk if not run. We may have rate cuts, we may have bailouts, we may have tax cuts - but to invest in building the country's infrastructure is the best way to stimulate the economy. I think this may be a win-win situation. 

A win for the consumer, A win for the private sector, A win for country. This may be the best time to invest for a better & bright future. 

You can read about the stocks I recommending at stockezy.com  - click here

Disclaimer - Yes this is necessary. I am no stock-pundit or analyst. I am common man who reads his newspaper, uses common sense to make investing decisions. I do see price-trends on the stock-charts available on stockezy. Try to do homework about my stocks. I am a software engineer by profession.

I am also the co-founder & CEO of stockezy.com - India's Social Investing Community. I usually blog on stockezy, but also like to share my comments here on my good friend Chirag's blog. I would love to hear from the readers of IndianMoneyPlus, you can connect with me at tushar@stockezy.com.

Cheers!

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NIFTY Weekly Technical Analysis

NIFTY was in a range bounded mode. Last week NIFTY closed at 2821 and this week at 2843 just a minor increase. The week was Volatile.
NIFTY TRIN at 0.286
Over all Nifty bearish.
5 day EMA at 2813.42

Pivot - 2890
Support - 2795 and 2745
Resistance - 2932 and 3045
Over all range bounded mode in coming week with more volatility expected.


Simple Moving Averages -

5 D	8 D	13 D	20 D	39 D	50 D	200 D
2795	2816	2784	2791	2889	2855	3842

NIFTY target for next week between 2745 and 2890.

Check NIFTY Autogenerated Technicals every day here. (LINK)

Whats HOT this week - TATA Nano will be launched on the 3rd of March.

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Long term Bet Larsen & Tubro Ltd.

Scrip: - Larsen & Tubro (LNT)
BSE Code: - 500510
CMP: - 638.70
52 Week H/L: - 1937.00 - 611.00
Target for long term investors : - 100% return. (Time frame 15 - 18 months)

Summary: -
One of the badly beaten out scrip in the Indian markets is LNT.
Larsen & Toubro Limited operates in four segments. The Engineering & Construction segment comprise execution of engineering and construction projects to provide solutions in civil, mechanical, electrical and instrumentation engineering to core sectors/infrastructure industries, shipbuilding and supply of complex plant and equipment to core sectors. The Electrical & Electronics segment comprises manufacture and sale of low-voltage switchgear and control gear, custom-built switchboards, petroleum dispensing pumps and systems, electronic energy meters/protection (relays) systems, control and automation products and medical equipment. The Machinery & Industrial Products segment comprises manufacture and sale of industrial machinery & equipment, marketing of industrial valves, construction equipment and welding/industrial products. Others include ready-mix concrete, property development activity, and engineering services and embedded systems.

Stake in Satyam -
Recently LNT hiked its stake in Satyam from 4% to 12%.
Satyam has won few new coustomers. The new management of Satyam Computers can change the phase of Satyam Computers which will directly benefit LNT.

A long term bet: -
It is India’s largest Engineering and Construction giant.
L&T is the best managed company in India – Business Today survey.
Larsen and Toubro will benefit from huge infrastructure investments in India and Gulf regions.
Strong Order book.
L&T will be demerged into Power, IT, Ship building and Railway units along with engineering division. Investors will get very good returns after the demerger.

Employees-
LNT is reported to recrute 10,000 people in 3 yrs. This is because of its expansion.

Ratings -
Short term: - 5/10
Medium Term: - 7/10
Long term: - 10/10

Company has good financial. Good management also.
A safe bet for long term investors.

Happy Investing.
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Stock Idea - Areva T&D.

I had given this stock advice earlier on 8th September last year. The stock gave a 20% odd return because of N-Deal (N Deal was passed out) and later went down badly due to volatility in the markets in India and also globally.
More over there was a Split in the Scrip.

Areva T&D Ltd.
CMP: - 189.15
BSE Code: - 522275
Market Cap: - 4522.58
52 Week H/L: - 391.99 - 130.00

Summary: -
Areva T & D India Ltd. is an India-based company engaged in the business of power transmission and distribution. The Company’s products and systems serve to transmit and distribute electricity, as well as operate networks through information management. Areva T & D India Ltd. is present at all stages of the supply power chain, from the generator to the end user, backed by a services portfolio. The Company has a presence in more than 30 countries.

Business: -
Areva has many ‘firsts’ to its credit, thus gaining market leadership in a number of products; The company commissioned India’s first Extra High Voltage substation of 765 kV for NTPC in 2007. It built the largest power generating transformer for Reliance Energy in the same year. It is also a market leader in GIS (Gas Insulated Switchgear) substation. GIS are much more compact as they occupy significantly lesser space compared to AIS (Air Insulted Switchgear). Given the demand for space in the country, the company quickly capitalised on this need especially in urban substations. Areva is also expanding capacities for the high voltage transformers and GIS switchgears to cater to the growing market and retain leadership position.

Expansion: -
Areva plans to double its capacity over the next two years with Rs 700 crore investments in Greenfield projects. The expansion move appears timely as the company, apart from catering to local demand, has also started receiving outsourced orders from its parent.
With this Rs 700 crore investment, these facilities are coming up at Padappai and Hosur in Tamil Nadu and Vadodra in Gujarat by March 2009. With the expansions in place Areva would be able to double its Revenues over the next three years.

N Deal: -
The company already makes nuclear reactors and rotors. Its parent company is a world leader in conventional nuclear projects. It makes turbines for nuclear power stations. It supplies steam turbines to over 30% of nuke power stations globally.

Key Positive -
Areva T& D has an order book that exceeds at least one year of Revenues, thereby provding earnings visibility. The company, even during this slow down has not witnessed any major deferments that could disturb its revenue stream.
The Expansion is a key positive factor.
N Deal has been passed which is one major positive factor for this scrip to benefit.
Good Order Book.
Financials are strong.

Have a long term view on this scrip.

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Happy Investing.
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Market outlook and Intraday tips for 6th Feb.

US markets ended a higher note.
Europe was trading volatile.
Asia has opened strong. Expect Indian Markets to open strong.

The support for the Sensex is 9034-8940-8868 and the resistance to the up move is at 9389

Nifty: (2780) the support for the Nifty is at 2705 and the resistance to the up move is at 2847-2904

Day Trading Ideas -

Aban Offshores
Buy above 423 for targets of 426 and 430
Sell below 409 for targets of 405 and 402

Dish TV
Buy above 23.25 for targets of 24.10 and 25.25
Sell below 21.25 for targets of 20.50 and 19.65

GMR Infra
Buy above 70.85 for targets of 71.90 and 72.50
Sell below 68.50 for targets of 67.90 and 66.50

GVK Power
Buy above 19.20 for targets of 19.90 and 20.45
Sell below 18.40 for targets of 18 and 17.45

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Inflation to 11 months low of 5.07 percent

Inflation data was released yesterday , it is just .05 percent to go below 5 percent , it has come at 5.07 percent in 12 months to 24 January 2009,which is almost 0.60 percent down compared to previous week raised of 5.64 percent.

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Market outlook and Intraday tips for 5th Feb.

US markets plung after concerns about disappointing earnings and the market ended the day with a loss.
Europe ended a higher note.
Asia is trading marginally lower.
Expect Indian Markets to open flat to negative.

The support for the Sensex is 9034-8940-8868 and the resistance to the up move is at 9389

Nifty: (2803) the support for the Nifty is at 2705 and the resistance to the up move is at 2847-2904

Day Trading ideas -

Adlabs
Buy above 163 for targets of 166 and 169.50
Sell below 154 for targets of 151 and 149

Axis Bank
Buy above 399.45 for targets of 404.25 and 409.10
Sell below 388 for targets of 385 and 383

India Infoline
Buy above 43.90 for targets of 44.50 and 45.90
Sell below 41.20 for targets of 40.50 and 39.90

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Market outlook and Intraday tips for 4th Feb.

US markets ended higher after rebound in home sales was seen.
Europe ended higher too.
Asia has opended higher note. Expect the Indian Markets to open higher.

The support for the Sensex is 9034-8940-8868 and the resistance to the up move is at 9389

Nifty: (2767) the support for the Nifty is at 2705 and the resistance to the up move is at 2820

Day Trading Ideas

RNRL
Buy above 46.10 for targets of 46.80 and 47.50
Sell below 44.25 for targets of 43.90 and 43.20

Tata Motors
Buy above 136 for targets of 139 and 143
Sell below 128 for targets of 125 and 122

HDIL
Buy above 80.50 for targets of 81.90 and 82.65
Sell below 78.10 for targets of 76.85 and 75.90

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Market outlook and Intraday tips for 3rd Feb.

US markets ended mixed.
Europe was trading in red. Asia has opened mixed.
I expect Indian markets to open flat to negative.
Markets may remain volatile throught the day.

The support for the Sensex is 9034-8940-8868 and the resistance to the up move is at 9232

Nifty: (2767) the support for the Nifty is at 2705 and the resistance to the up move is at 2820

Day Trading Ideas

DLF

Buy above 156 for targets of 160 and 163

Sell below 149 for targets of 144 and 141

Hindalco

Buy above 47.90 for targets of 49.10 and 50.50

Sell below 44.10 for targets of 43.25 and 42.50

Ranbaxy Labs

Buy above 214 for targets of 218 and 221

Sell below 209 for targets of 207 and 203

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