Reliance Communications has posted a net profit of Rs 3700.00 million for the quarter ended June 30, 2009 as compared to Rs 3473.80 million for the quarter ended June 30, 2008. Total Income has decreased from Rs 35590.60 million for the quarter ended June 30, 2008 to Rs 31970.70 million for the quarter ended June 30, 2009.
Finquest Securities has advised traders to buy Reliance Communications with target of Rs 267-280.
“Reliance Communications has formed a variant of Bullish Morning Star at the lower band of its falling channel. Prices thus seem likely to witness a relief rally towards Rs 267-280. Buy the stock on dips to Rs 245 for a target of Rs 267-280 and keep stoploss below Rs 238,” said the technical note.
State of markets abroad:
US markets crack down badly.
Europe also ended in deep red.
Asia has opened negative but will start picking up.
Indian Markets are bonded to open flat to negative but will recover during the later part of the day.
The support for the Sensex is 14500 and the resistance to the up move is at 14809-15000
Nifty: (4349) the support for the Nifty is at 4292 and the resistance to the up move is at 4380-4400
Day Trading Ideas :
DLF : Buy above 338 for targets of 341 and 345. Keep a SL of 333
Reliance Communication : Buy above 295 for targets of 301 and 305. Keep a SL of 291
HCC : Buy above 107.10 for targets of 108.25 and 109.50. Keep a SL of 105.90
Happy Investing !
US markets ended with minor losses.
Europe was ended flat.
Asia has opened a bit positive.
Expect the Indian Markets to open flat to positive.
The support for the Sensex is 14188-14000 and the resistance to the up move is at 14727-14894
Nifty: (4247) the support for the Nifty is at 4200 and the resistance to the up move is at 4406
Day Trading Ideas :
IFCI : Buy above 54.10 for targets of 54.85 and 55.80 SL of 53.45
IDBI : Buy above 110.20 for targets of 111.25 and 112.10 SL of 109.10
RCom : Buy above 301 for targets of 305 and 309 SL of 296
MTNL : Buy above 98.20 for targets of 98.90 and 99.45 SL of 97.50
US markets ended higher.
Europe ended higher.
Asia is trading higher.
Expect Indian Markets to have a gap up opening again. A gap up of 400 points on Sensex.
The support for the Sensex is 13500 and the resistance to the up move is at 14452-16046
Nifty: (4323) the support for the Nifty is at 4000 and the resistance to the up move is at 4305-4650-4775
Day Trading Ideas -
LNT
Buy above 1375 for targets of 1420 and 1500
Sell below 1250 for targets of 1190 and 1110
RNRL
Buy above 72 for targets of 75 and 79
Sell below 65 for targets of 62 and 59
RCom
Buy above 310 for targets of 325 and 355
Sell below 275 for targets of 250 and 230
US markets ended negative.
Europe ended flat.
Asia has opened negative.
Expect the Indian Markets to open higher. Indian markets may not follow the global cues today.
The support for the Sensex is 12000 and the resistance to the up move is at 12569-12857
Nifty: (3672) the support for the Nifty is at 3600 and the resistance to the up move is at 3800
Day Trading Ideas -
RCom
Buy above 235 for targets of 237 and 241
Sell below 229 for targets of 224 and 222
Adlabs
Buy above 240 for targets of 246 and 252
Sell below 225 for targets of 220 and 216
TCS
Buy above 650 for targets of 656 and 660
Sell below 632 for targets of 629 and 625
RNRL
Buy above 59.10 for targets of 60.15 and 61.25
Sell below 56.30 for targets of 55.80 and 54.25
US markets ended mixed but mainly positive.
Europe ended marginally lower.
Asia is trading mixed.
Indian markets may have a flat to positive opening.
The support for the Sensex is 11070 and the resistance to the up move is at 11638
Nifty: (3484) the support for the Nifty is at 3400 and the resistance to the up move is at 3734
Day Trading Ideas
RIIL
Buy above 814 for targets of 824 and 839
Sell below 789 for targets of 781 and 776
RCOM
Buy above 236 for targets of 241 and 248
Sell below 219 for targets of 212 and 208
Despite the current economic gloom the mobile phones business in India is continues to surprise and continue to boom. Led by worlds lowest call rates and availibility of cheapest handsets this is one sector which promises continued growth in otherwise troubled times in Indian economy.
To give you some insight to the kind of acclerated growth being seen in India' mobile market, let me highlight some key numbers. In January of 09 alone a the mobile market added 15.4 million new wireless subscirbers the biggest monthly growth ever.
To see this magnitude of unprecedented expansion in the telecom sector in the midst of deep slowdown in consumer demand and cut-back in domestic spending is proof enough that there is tremendous potential for staying invested for the long term.
The Indian mobile market boasts the most fierce and cut-throat competition and at the same time offers the worlds lowest call rates . But this is no bad news. Afforadibility is seen as the single-most important catalyst which is fueling this rapid growth.
Customers pay less that 50 paise for a call and new handset can be bought for as little as Rs.750. It is no surprise that India has now surpassed China to be the worlds fastest growing cellular market.
>> The beginning of the mobile revolution
It is not just affluent indians who are buying mobile phones, but the real growth is driven by the poor; Labourers, maids, drivers and other lowly paid people in cities are now buying mobile phones too.
The mobile service providers are aggresively rolling out new networks, sharing infrastructure costs and aiming to drive the mobile revolution deeper in to India's poorer markets. In rural areas the farmers are using mobile phones to call other farmers to find out market price for crops and also to stay in touch with distant relatives more often than before. The rural market of India presents a new opportunity to expand growth further.
The key to this surge in rural mobile subscriptions is due to the fact that these people are not affected by the global crunch. They do not own shares, or real estate hence are not being hit by the US credit or mortgage crises. There is enough employment for all and the crops being produced are to a great extent being consumed by the domestic markets.
>>Opportunity for further Growth for Cellular Companies
Rural India accounts for 70% of the 1.1 billion total population. Till the end of January of the total population who own a telephone only 9% were situated in rural areas, hence it is obvious that the next acclerator for mobile growth will come from rural india.
Expected growth : The forecast for 2010 is for total mobile subscirbers to rise to 525 million , and rise further to 740 million in 2012. The telecom providers know this fact and are moving fast. Bharti Airtel, Reliance Communication and Idea Cellular are 3 top Private service providers, followed by BSNL and MTNL which are backed by the government.
BSNL also announced rollout for 3G services in 700 cities in India by July 2009. This is another encouraging piece of information which will allow added revenue from data services, email and more profitable Business and Enterprise customers.
Stocks to Watch out for:
Bharti is a very experienced player in the market and has the reach and financial backing to aggresively invest in newer markets, rural as well as Urban.
Idea already has good reach and is expanding on its customer base in rural India and is beginning to establish itself in urban towns and cities with pervasive advertising campaingns and publicity.
MTNL is backed by the state and is expanding is data networks bringing Internet to the rural areas which has good potential in the coming years.
I am not too optimistic about Reliance Communications due to continued hinderance caused by Mukesh Ambani Group. In my opinion the telecom sector will see M&A activity and ADAG-Mukesh Group standoff creates uncertainity which is not good for the stock price.
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The source for numbers and facts & figures provided in this article are coutesy: The Associated Press. The original article can be found at STOCKEZY.COM - India's Social Investing Community. You can connect with me at tushar@stockezy.com
Also I would like for you to check out http://stockezy.com/answers/
Investors with a two-three year horizon can consider buying the share of Reliance Communications (RCom), going by its pan-India dual-technology mobile play and the strength in its enterprise division, both of which offer long-term growth prospects.
At Rs 155, the stock is available at a reasonable seven times its likely 2008-09 per share earnings.
RCom has been in a heavy capex phase for the last one year, leading to its pan-India GSM launch in December 2008. The company has indicated that capex for 2008-09 is roughly Rs 25,000 crore (much of it already capitalised), while for the next fiscal it could be around Rs 15,000 crore. Given the fact there is heavy foreign currency borrowings in RCom’s balance sheet, servicing this debt will mean that margins are likely to remain under pressure for the next 12-18 months. However, this is probably the last significant capex phase for the company.
In the meanwhile, with a burgeoning subscriber base aided by its GSM launch in 14 new circles, strength in its other divisions — broadband and enterprise data (domestic and international) — is gaining momentum to provide broad-based growth for the company.
SYNERGIES FROM GSM launch
RCom has a pan-India CDMA presence with about 50 million subscribers. In addition, in eight circles where it currently operates, there are 10 million subscribers. In late December last year, RCom launched GSM services in the other 14 circles as well. The total subscriber additions in January alone stood at 5 million, bulk of which is expected to have come from new GSM subscribers.
It remains to be seen if this success does not cannibalise its CDMA offering. Despite being a CDMA player, where ARPUs are lower, RCom’s realisations per minute are around 61 paise , which compares favourably with most GSM operators. This may improve a wee bit after the GSM launch, especially because there are no serious discounts in tariffs that is being offered to customers.
RCom has built a nationwide and international network to carry its own national and international traffic. This would also help it garner countrywide roaming revenues and incoming international roaming on both its networks which went to other GSM operators.
With its pan-India CDMA towers, the GSM arm also gains by co-locating tower facilities, resulting in lower capex and opex for RCom, apart from improving tenancy.
In a related development, new licence winner Swan Telecom has reportedly signed up for a tower sharing pact. This should provide an added source of revenue for the company.
Other Contributions
RCom derives over 33 per cent of its revenues from its global and enterprise data businesses.
In its global business, the company provides domestic long distance connectivity to operators such as Vodafone Essar, Idea Cellular, Tata Teleservices and Aircel and derives 40 per cent of its NLD revenues from these operators. This could grow as new operators step in to offer services, but there is competition from BSNL and Bharti Airtel as well. But as the market is largely dominated by these three players, RCom could still end up with a substantial pie.
The company’s international connectivity division is also seeing considerable growth both in organic (through Flag) and inorganic modes through acquisition of Vanco Group in Europe and Yipes in the US. This division has 1,400 customers for data connectivity as well as 750 carriers.
Through Vanco, the company has had large multi-year deal wins with several retail majors in Europe, such as the Oxylane Group and Illy Caffe. Being transaction-intensive, these are likely to provide revenue visibility over the long-term.
The Yipes division is also witnessing traction and has added 25 customers in the last quarter, including names such as Facebook, Troutman Sanders and NASDAQ OMX Europe.
In the domestic enterprise segment, the company is the second largest player, according to a recent study by Frost & Sullivan. This is an 18.7 percent share of a Rs 7,400 crore market, expected to go up to over Rs 13,000 crore by 2013. Client wins are happening here too. This segment serves 900 corporate customers across India and enjoys an EBITDA margin of 42.2 per cent.
The company has network connectivity to 8,92,000 buildings across the country that would allow it to deliver connectivity through a variety of wired and wireless modes.
With the global economy slowing down and with clamping down on travel budgets, corporates, it is expected, will transact and communicate more through communication modes such as virtual private network. This means greater business opportunity for companies such as RCom.
Recliance Communication added 5 million subscribers in Jan. Indias second largest mobile operator added such a huge number after it started its GSM operation nation wide.
Airtel added 2.73 million users and Vodafone added 2.4 million users.
Reliance Communication (RCom) has entered into a Rs 500 million deal with US-based Ditech Networks to deploy the latter`s voice enhancement solution on its recently unveiled GSM network, reports Economic Times. The company said that this deployment is expected to enhance voice clarity on Reliance Mobile by approximately 30%. RCom is undertaking Ditech trial runs on its network starting Feb. 12, 2009. RCom will initially deploy Ditech`s voice enhancement solutions across Top 10 towns and later extend coverage across other locations. Ditech Networks is a global telecommunications equipment supplier for communications networks. Ditech Networks` voice processing products serve the needs of mobile and wireline operators for circuit- and packet-based networks. RCom has also unveiled a series of network enhancement initiatives for urban areas. These include plans to increase its Base Tower Stations (BTS) from current 25,000 stations to over 36,000 stations. - MyIRIS
US markets on Friday were marginally lower. The support for the Sensex is 8246-9130 and the resistance to the up move is at 9551 Nifty: (2875) the support for the Nifty is at 2800 and the resistance to the up move is at 2904-2962.
Europe markets ended lower.
Asia has opened weak.
India is bonded to open flat to negative.
TCS
Buy above 514 for targets of 520 and 528
Sell below 507 for targets of 502 and 498
RCom
Buy above 176 for targets of 180 and 184
Sell below 166 for targets of 162 and 158
IFCI
Buy above 19.60 for targets of 20.10 and 20.50
Sell below 18.50 for targets of 18.10 and 17.55
Unitech
Buy above 33.15 for targets of 34.20 and 35.10
Sell below 31.10 for targets of 30.25 and 29.50
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Happy Investing !
US markets went higher as Obama announces a bailout package of 813 Billion $. The target for the Sensex is 9150 and the resistance to the up move is at 9334-9410-9550 Nifty: (2850) the target for the Nifty is at 2820 and the resistance to the up move is at 2870-2904 I expect markets to be in Green.
Europe ended higher. Asia is trading higher.
I expect Indian Markets to have a gap up opening.
HDIL
Buy above 98.50 for targets of 99.85 and 101.20
Sell below 92.40 for targets of 91.25 and 90.10
TCS
Buy above 511 for targets of 515 and 521
Sell below 498 for targets of 494 and 488
R Com
Buy above 171 for targets of 178 and 184
Sell below 159 for targets of 155 and 151
Happy Investing.
Bharti Airtel - Upside expected of 25% from CMP. Subscribe for free Email Updates - Click here. Free SMS Updates subscribe - Click here.
Unitech - Upside expected of 150% and even more from CMP.
Suzlon - Upside expected of 50% or more from CMP.
R Com. - Upside expected of 30% or more from CMP.
LNT - Upside of 25% to 40% from CMP.
Sun Pharma - Upside of 20% from CMP
Ranbaxy - Upside of 35% from CMP.
HDIL - Upside of 40% from CMP.
NTPC - Upside of 25% from CMP.
And just remember FD would have given you 10% returns in one year. And just see what these stocks can possibly give you.
Data is prepared by Vinod Jethmalani.
Reliance is innovative isn’t it? Or are they laying a trap for their customers?
God knows about it.
But the good news for what the stock is a value buy is that the company has got license to operate GSM in 18 different circles in
It is the only telecom company in
Reliance India Mobile has announced bumper offers for GSM subscribers in Mumbai. Reliance will also launch GSM services in 24,000 towns and 6,00,000 villages in 18 circles across
If they start so they can beat Airtel in its market share.
At present the leading company’s in
Other factors by which RCom will benefit –
I term this scrip as a value buy at 200 – 210 levels and would love to keep for long term of 18 – 24 months.
Happy Investing!
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