Technical Analysis: SBI

This stock refused to buckle under pressure and managed to hold above the key support at Rs 1,600 last week.

The near-term outlook for SBI has been revised to neutral.

The stock is expected to fluctuate in the band between Rs 1,600 and Rs 1,800 next week. Fresh longs are recommended only if the stock moves Rs 1,800.

The medium-term view for SBI stays negative. Move between Rs 1,600 and Rs 1,800 will be construed a pause before the resumption of the downtrend from the January peak.

Investors should wait for a close beyond Rs 1,950 before buying the stock. The stock could move towards Rs 1,400 over the medium-term.

Infosys seen reporting good Q4 results

IT bellwether Infosys seen reporting good Q4 March 2008 results. The company unveils results on Tuesday, 15 April 2008. A total of five prominent brokerages expect a between 3.56% to 6.2% growth in Infosys’ adjusted consolidated net profit at between Rs 1223.10 crore to Rs 1254.40 crore in Q4 March 2008 over Q3 December 2007. Operating profit margin is seen remain more or less steady compared to 32.6% in Q3 December 2007.

These five brokerages expect a between a 5.5% to 6.5% growth in revenue at between Rs 4504.50 crore to Rs 4546.90 crore.

Market men will focus on the company’s guidance for the current year. Infosys guidance will give investors a sense of the effect of the weakening US economy on technology spending by companies there.

Opto Circuits completes acquisition of Criticare Systems

Medical diagnostics manufacturer, Opto Circuits (India), on Friday said that it has successfully completed the acquisition of US-based healthcare company, Criticare Systems, Inc.

With effect from April 10 Criticare Systems is a wholly-owned subsidiary of Opto Circuits, a press release issued stated.

Commenting on the deal, Opto Circuits' Chairman and Managing Director, Vinod Ramnani, said that "we are pleased to complete the acquisition of Criticare."

The transaction would also open many new markets for Criticare's products, he added.

Criticare Systems designs, manufactures and markets cost-effective patient monitoring systems and non-invasive sensors for a wide range of hospitals and alternate health-care environments globally.

"We are confident that our global infrastructure and marketing presence will enhance Criticare's position as an innovator and supplier of world-class healthcare solutions," Ramnani said.

HOT STOCKS FOR 11 - 04 - 08

STATISTICS :

Markets today will open with a positive movement of 30+ points in Nifty and will trade volatile, Todays news to watch out is inflation so Markets will rebound once inflation comes below 7%, analysts expect to be @ 6.92% so could be positive with volatile session, Nifty has some support @ 4700 and resistance @ 4810 levels. Sensex has some support @ 15558, and resistance @ 15981 level. steel is a sector to watch out for todays session.

INTRADAY :

SAIL : buy for a tgt of 165+, sl @ 157.55

ADLABS : buy for a tgt of 640+, sl @ 617

DELIVERY :

RAJESH EXPORTS : buy for a tgt of 125+ for 2- 3 months : 240 + for 1 year

SAIL : buy for a tgt of 240+ in 2 - 3 months

MTNL : buy for a tgt of 130+ :: 3 months tgt

FUTURES :

SAIL : buy for a tgt of 180+, sl@ 153.2 :: delivery 5- 8 trading sessions

SATYAM : buy for a tgt of 432+, sl @ 419 :: intraday

ZEELTD : buy for a tgt of 247+, sl @ 236 :: intraday

RPL : buy for a tgt of 180+, sl @ 173 :: intraday

RCOM : buy for a tgt of 494+, sl @ 479 :: intraday

Nifty : buy for a tgt of 4910+, sl @ 4672 :: delivery

OPTIONS :

Nifty : buy 4900 call for a tgt of 120+ :: delivery

RCOM : buy call 500 for a tgt of 30+, sl @ 8

SAIL : buy call 170 for a tgt of 15+, sl @ 3

Brokerages' Q4 core incomes to see sharp drop

Indian brokerages are likely see their Jan-March earnings nearly halved from the previous quarter, mirroring the sharp fall in trading volumes in the equity market, officials said.

The average daily derivatives turnover on National Stock Exchange (NSE) dipped to Rs 45600 crore in March from Rs 67000 crore in December, according to the NSE website.

The average turnover in the cash segment of NSE fell to Rs 14000 crore at the end of March from Rs 19300 crore.

"It (the impact) would be in line with the market volume, so the market volume has come down by 50 percent, the broking volume will come down by 50 percent," said Rashesh Shah, chairman of Edelweiss Capital.

There will be decline in the earnings on a quarter-on-quarter basis, but on a year-on-year basis the earnings will be very high and could be five times higher than last year, said Motilal Oswal, chairman of Motilal Oswal Financial Services.

The benchmark 30-share BSE index has shed more than 22 percent during the first three months of 2008.

Spreading to contain

"We don’t use these huge rises in the market as the basis for making a future projection," Amit Majumdar, executive director, Angel Broking, said when asked about his expansion plans.

Angel Broking's average daily trading volume has come down to about Rs 2000 crore against Rs 3500-4000 crore earlier, he said.

However, the revenue impact would not be so high as many clients have switched to delivery-based trading, he added.

"The market has moved from unsafe hands to safer hands, which means it has moved from F&O (futures & options) based business to delivery based business."

"So, though its a Rs 2000 crore business, the brokerage rate is higher as delivery charges are higher, so you tend to break even," Majumdar said.

Indian brokerages have been rapidly expanding their services and reach to tap the huge potential in smaller towns and cities.

India has 193 broking firms with terminals in more than 100 cities and 25 of them have more than 1,000 terminals each, advisory firm Dun & Bradstreet said in a report.

They are also diversifying their income stream by distributing third-party financial products like mutual funds, insurance products and earnings fees from them.

Lehman's Nalin Nayyar joins Citi

Even as global banks Citi and Lehman plan job cuts internationally, they continue to hire in the country. Globally, most investment banks have frozen recruitment; some have even started retrenching people. But in spite of the problems it faces globally, Citi made a senior-level hire in the investment banking space on Wednesday snapping up Nalin Nayyar, MD-investment banking from Lehman Brothers India. Mr Nayyar’s move comes even as Lehman Brothers is looking at making senior hires in India.

This is also the first senior-level movement in the industry in recent months. The move has caught the industry by surprise as most banks have put a freeze on recruitment. Citi has lost a few senior officials. These include Anil Gudibande who has left the firm to join AIG private equity, Ashish Pitale, director, Citigroup Global Markets is joining Deutsche Bank.

It also lost Ratnesh Kumar, MD and head of research and Rajesh Mayani, director, institutional equity sales to Anand Rathi. Mr Nayyar had joined the Indian franchise of Lehman from its London office. He was earlier in Citi.

For Lehman, this was the second senior official which had quit the firm in recent months after Jayanta Banerjee who had joined the firm from ICICI Ventures as head of private equity moved back to ICICI Ventures. The firm is also said to be looking at retrenching 5-10% of its global workforce. Although there have been rumours that Lehman may retrench people in India its officials have vehemently refuted such rumours.

“We are adding people in all areas. We are looking to strengthen investment banking, real estate and equities and fixed income. India has been an outperforming business. Its a young business. The firm has been focused on building the Asian franchise and in particular India.” said Tarun Jotwani, chairman and CEO, Lehman Brothers India.

The firm now has 172 people on board now as against 146 last year. Incidentally among the newer firms which had started operations in India, Lehman is the only firm who have lost senior officials. Adds Mr Jotwani,“The Indian business has performed way beyond our expectation in revenue terms.

Last year we achieved our budget which we were supposed to achieve in year four or five. We performed five times our budget. Four months into this year, we have exceeded our yearly budget. We had monetised some of our private investments last year. We did a few in December and January and are in the process of monetising a few more over the next few months.”

With the markets in a turmoil both financing and IPO activities have been low for the past couple of months which have affected a lot of firms. “There is very little financing activity but we do have an advisory pipeline. With the revaluation of the markets we are seeing an opportunity in private equity, infrastsructure financing and real estate,” he added.

In equity brokerage, in the secondary market, with the acquisition of Brics we have been increasing our volumes and market share even in an environment where overall market activity is lower,” he added. Lehman’s balance sheet size in India is more than $2 billion.

India ranks 44th in most-preferred retail locations list

India, which boasts of a growing retail market, ranks 44th in the list of most preferred retail destination in the world due to factors like FDI restrictions and lower average per-capita income, a report has said.

According to the report 'How Global is the Business of Retail', which maps the global footprint of 250 of the world's top retailers, India is at number 44 in the list of preferred destinations in relation to market, regional trends and other influences.

"Even though the Indian economy is growing at a rapid pace with consumers having more buying power, we are still only at the 44th position on this list. This is primarily due to FDI restrictions in retail and also relatively lower average per-capita income in the country," CB Richard Ellis South Asia Chairman & MD Anshuman Magazine said in a statement.

He hoped that India would move up in the rankings if FDI norms are relaxed and economic growth continues.

Out of the BRIC (Brazil, Russia, India and China) countries, China and Russia are in the top 10 of the rankings. Brazil is also lower in the order.

The report ranks the UK as the current global leader in relation to the presence of international retailers. The UK hosts 55 retailers that were surveyed.

Spain's position as the second-ranked market, closely trailing the UK, gives perspective to the market's new global significance. It houses 51 per cent of retailers surveyed.

Spain's growing ability to attract global retailers to its shores is fuelling its rise as a global retail destination and threatening the UK's title as the 'most international retail market' in the world, according to the report.

The top 10 also included France, Germany and UAE.

The US occupied the 11th position, with 39 per cent of international retailers present in that market. CBRE attributes this to the maturity, size and strength of its domestic retailers, which make it a market that only the strongest foreign retailers are able to break into.

The report also found that luxury goods dominated international retail scene, with almost 90 per cent respondents in the segment having a presence in more than 10 markets. This was markedly more than grocery, food and drinks, with just 60 per cent present in 10 or more markets.

In clothing, footwear and accessories segments, 54 per cent retailers had operations in more than 10 markets.

However, as the report illustrated, many luxury retailers are well-known particularly for their clothing range, such as Hugo Boss or Versace, reflecting the historical tendency for high fashion brands to be offered internationally.

Least likely to 'travel' were the department stores, with only 5 per cent being represented in 10 or more markets.

Germany lines up incentives to woo Indian investors

Germany on Thursday invited Indian companies to invest and set up manufacturing facilities in the country, saying it offers a slew of tax rebates and other financial incentives measures.

"When making their investment decisions, investors frequently look at the eastern and western European market separately, and often overlook the fact that with its strategically favorable position, eastern Germany is an exceptional investment location for serving both markets from a single site," German Deputy Minister of Transport, Building and Urban Affairs Engelbert Lutke Daldrup said here.

Speaking at a KPMG-FICCI event, he said the government gives high level of tax rebates for investing in east Germany, besides providing a range of financial assistance schemes.

"Technology-based companies can benefit most from east Germany as it provides with huge investment potential," he said, adding Indian companies in sectors, like automotive, mechanical engineering, micro-electronics, renewable energies, biotechnology, pharmaceuticals and chemicals can also gain from investing in the country.

Currently, about 20 Indian companies in east Germany employ about 2,000 people and the country expects to double this number in the next 2-3 years, he said.

"Many Indian companies want to come to east Germany. Presently few Indian pharmaceutical firms and automotive component makers are holding discussions with us," Daldrup said, without divulging name of the companies interested in investing in east Germany, which was united with West Germany after the end of Cold War.

India's iron ore wealth to last for 200 years

Seeking to allay apprehensions of steel industry on iron ore availability, the Mines Ministry on Thursday said the country has enough ore to last for 200 years and mineral-rich states would not lose their say on allocation of mines in the New Mineral Policy 2008.

"The country has enough iron ore to last for 200 years. The steelmakers should adopt technologies to be able to use ore grade below 55 per cent Fe. If you come up with right technologies then you could conserve ore in right perspective," Mines Secretary J P Singh said here.

He said India is the only country where captive mining is encouraged and of the total output in the country, utilities like SAIL and Tata Steel produced 37 per cent from their captive mines at only Rs 350 per tonne as pithead cost.

Singh denied the contention of mineral-rich states that the new Policy seeks to curtail their rights vis-a-vis making priority allocation of mines to potential investors. There was nothing in the policy that could reduce their powers, he said.

Replying to a query on concerns expressed by steelmakers on unabated iron ore exports, the Secretary said only low-grade ore was being shipped to China as the domestic utilities lack the required technology to beneficiate the same.

He took a potshot at the Steel Ministry for projecting a production figure of 200 million tons by 2020, saying it was unclear how it would happen. "First they said India would achieve 110 MT production, then they revised it to 200 MT. I don't know which figure was closer to reality," he contended.

India's Gas Shortage Gets Relief From Reliance Output

Reliance Industries Ltd may produce 50 percent more natural gas from India's biggest field than the company estimated, easing shortages that idled utilities in the world's second fastest-growing economy.

The Krishna Godavari region in the Bay of Bengal may yield as much as 120 million cubic meters a day after eight new discoveries, V.K. Sibal, India's oil and gas regulator, said in an April 8 interview at his office outside New Delhi. The previous target for the field, scheduled to start production in the next 12 months, was 80 million cubic meters.

Reliance, India's largest company by market value, is investing $5.2 billion to develop Krishna Godavari, which will more than double the country's output and may alleviate shortages that have shut down a third of the nation's gas-fired power plants. Demand may quadruple to 400 million cubic meters a day by 2025 if the economy expands at the government's projected annual rate of 7 to 8 percent, according to the Oil Ministry.

``Such finds may make explorers look at India as a country rich in hydrocarbons,'' said Jaspreet Singh, an associate vice president at Prabhudas Lilladher Securities in Mumbai. ``India needs to increase oil and gas output because fuel demand is rising and the supply gap is widening.''

Reliance profits almost doubled in the past three years on record earnings from processing crude oil into fuels. The Mumbai- based company intends to start production during the second half of the financial year ending March 2009, Chairman Mukesh Ambani said last year.

Shares Rise

Mumbai-based Reliance's Shares rose 49.65 rupees, or 2 percent, to 2,467.7 at the 3:30 p.m. close on the Bombay Stock Exchange. The benchmark Sensitive Index or Sensex, fell 0.6 percent to 15,695.10.

``I don't have any doubt that output from the east coast will keep on increasing,'' Sibal said in his office at the Directorate General of Hydro Carbons in Noida. ``The cost of developing adjoining fields will be incremental because they are anyway putting in place infrastructure to bring gas from the biggest field onshore.''

Sibal said estimates for the increase are based on initial details provided by Reliance.

``We have not submitted a new development plan'' to Sibal's office, Reliance spokesman Paresh Chowdary said in an e-mail. ``Any additional production approvals will be possible only on submission and evaluation of a development plan.''

Record Auction

India is auctioning rights for a record 57 gas-producing areas this year as the government contends with record crude oil prices while seeking to sustain annual economic growth of more than 8 percent.

BG Group Plc, the U.K.'s third-biggest natural gas producer, and Santos Ltd., Australia's third-biggest oil and gas company, are among drillers that won rights to explore in India last year. The nation sold 165 areas in six previous rounds, yielding 49 oil and gas finds, Sibal said on Jan. 8.

Crude oil prices at a record $111 a barrel make it viable to bring smaller discoveries into production, Sibal said. U.S. natural gas futures for delivery at the Henry Hub in Louisiana rose 31 percent in the past year on the New York Mercantile Exchange.

Fields adjoining Reliance's main discovery, called D-6, will be linked to pipes and booster stations being built to transport fuel from the field, Sibal said.

`Very Little Doubt'

``On the basis of the infrastructure that is being put up, there is very little doubt that gas output from Reliance's fields will be more than has been talked about,'' said Daven Chokesky chief executive officer at Mumbai-based K.R. Choksey Shares & Securities, which manages $550 million for wealthy individuals.

Natural gas prices may rise 50 percent within five years because producers including Russia and Nigeria, which hold almost half the world's gas, are curbing exports to meet growing domestic use, according to Chris Jarvis, president of Caprock Risk Management in Hampton Falls, New Hampshire.

Increasing demand and lack of supplies forced Japan and South Korea to pay more than double the U.S. benchmark gas price for cargoes this winter from as far away as Trinidad, the biggest LNG supplier to the U.S.

India plans to resume talks with Pakistan over a pipeline to transport gas from Iran after more than a decade of delays to meet rising demand, Oil Minister Murali Deora said on March 28.

Satyam BPO Wins Two Global Awards

Satyam BPO, the business process outsourcing arm of Satyam, a leading global business and information technology services company, announced today that it has won two prestigious Shared Services Excellence awards from the International Quality and Productivity Council. The company was honored in Orlando, Fla. during Shared Services Week, a conference organized by IQPC. Satyam BPO was a winner in the “Best Business Process Outsource Provider” and the first runner-up in the “Best Customer Service Delivery Framework” categories.

The IQPC Shared Services Excellence Awards honor, recognize, and promote Shared Services Organizations (SSOs) that demonstrate true best practices.

"We are delighted and honored to receive the 2008 Best Business Process Outsource Provider and Best Customer Service Delivery Framework awards,” said Satyam BPO Chief Executive Officer Venkatesh Roddam. “These awards are a clear acknowledgement of the culture of process and delivery excellence that we have created at Satyam BPO, as well as our sustained efforts to offer our customers the best sourcing experience through a combination of people, process and innovation excellence."

Additionally, Roddam said, the awards recognize Satyam BPO’s success in sharing best practices with its stakeholders, in addition to applying them to its own operations. “It is a testament to how shared services can help companies run their businesses with greater speed and efficiency, drive down operational costs, and increase profit margins,” he added. “As a result, they can increase their focus on business outcomes and customer satisfaction.”

The Shared Services Excellence awards are the latest in a series of honors Satyam BPO has garnered. Recently, the organization became the First Indian BPO to win the Rajiv Gandhi National Quality Award in the “Large-Scale Service Industry” category instituted by the Bureau of Indian Standards. It also won the Golden Peacock National Training Award 2007. Additionally, Satyam BPO is the world’s first eSCM capability level 5 service provider, a certification given by the IT Services Qualification Center (ITsqc) at Carnegie Mellon University in Pittsburgh.

For the Shared Services Excellence honors, Satyam BPO competed against global shared services organizations, including information technology and BPO organizations, as well as a number of clients. An eminent panel of judges scrutinized entries based on the range of services offered, clients, various people-centric measures, delivery and quality frameworks, technology, and other factors.

About Satyam BPO

Satyam BPO is powered by a combination of domain expertise, operational excellence, process skills, and superior technology. The organization is the world’s first eSCM Capability Level 5 service provider. One of India’s leading integrated end-to-end outsourcing service providers, the company offers proven, full-service expertise for multiple industries, including telecom, pharmaceuticals, financial services, and manufacturing. Satyam BPO’s global delivery standards have resulted in numerous longstanding client relationships with Fortune 500 companies. The company operates from its main delivery centers in Hyderabad, Bangalore, and Chennai – in addition to onsite delivery teams.

About IPQC

IQPC provides business executives around the world with tailored practical conferences, large scale events, topical seminars and in-house training programs, keeping them up-to-date with industry trends, technological developments and the regulatory landscape. IQPC's large scale conferences are market leading “must attend” events for their respective industries

DTS Sells Digital Images Business to Reliance Big Entertainment

DTS, Inc. announced that the Company has completed the sale of its Digital Images business to Reliance Big Entertainment Ltd., a member of the Reliance ADA Group of India.

The sale, which closed on April 4 for approximately $7.5 million in cash, marks DTS' exit from the image enhancement and restoration services business.

"We are pleased to have completed this transaction, which takes us one step closer to our goal of focusing entirely on our consumer business," commented Jon Kirchner, president and CEO of DTS, Inc. "We are delighted to have concluded a deal with a global industry leader in the media and entertainment space that will continue to build on the considerable talent and technology of the Digital Images business and continue to serve our long-term customers."

"DTS Digital Images, also popularly known as Lowry Digital Images, enjoys a superb reputation as the premier film imaging and restoration facility. The company fits well with the Digital Services strategy of the Reliance ADA Group in the global media and entertainment space," said Anil Arjun, Senior Vice President of Reliance.

About DTS

DTS, Inc. is a digital technology company dedicated to delivering the ultimate entertainment experience. DTS decoders are in virtually every major brand of 5.1-channel surround processor, and there are hundreds of millions of DTS-licensed consumer electronics products available worldwide. A pioneer in multi-channel audio, DTS technology is in home theatre, car audio, PC and game console products, as well as DVD-Video, HD-DVD, Blu-ray Disc and Surround Music software. Founded in 1993, DTS is headquartered in Agoura Hills, California and has offices in the United Kingdom, Ireland, France, Italy, Canada, Hong Kong, Japan and China. For further information, please visit www.dts.com. DTS is a registered trademark of DTS, Inc.

About DTS Digital Images

DTS Digital Images is a market leader in the digital restoration and enhancement of moving pictures. It delivers stunning picture quality using groundbreaking algorithms developed by visionary founder John Lowry. The company specializes in solving difficult film imaging problems like flicker, color breathing, dye fading, jitter and weave, mis-registration, film damage, dirt, grain buildup and lost detail. It also specializes in repairing video images with problems like dead pixels, sensor patterns, RF interference, high noise levels, poor focus and many others. DTS Digital Images has restored more than 300 of the world's most recognized feature films with output to DVD, HiDef, 35mm film, Digital Cinema, and IMAX. The company also works its magic on movie and television projects in production today, salvaging shots damaged in camera, in the lab, or even in airport X-ray scanners.

About Reliance ADA Group and Reliance Big Entertainment Ltd.

The Reliance Anil Dhirubhai Ambani Group (www.relianceada.com) is among India's top three private sector business houses on all major financial parameters, with a market capitalization of US$81 billion. The interests of the Group comprise communications, financial services, generation, transmission and distribution of power, infrastructure and entertainment. As part of the Reliance ADA Group, Reliance Big Entertainment is spearheading the Group's foray into the media and entertainment space and is building a significant presence in the Entertainment eco-system: across content, distribution platforms and services.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks, uncertainties, assumptions and other factors which, if they do not materialize or prove correct, could cause DTS' results to differ materially from historical results or those expressed or implied by such forward-looking statements. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including statements containing the words "planned," "expects," "believes," "strategy," "opportunity," "anticipates" and similar words. These statements may include, among others, plans, strategies and objectives of management for future operations; any statements regarding proposed new products, services or developments; any statements regarding future economic conditions or financial or operating performance; statements of belief and any statements of assumptions underlying any of the foregoing. The potential risks and uncertainties that could cause actual growth and results to differ materially include, but are not limited to, the timing, costs and attention attendant to the divesture of the non-consumer business, the transition to the next generation optical drives and consumer adoption of such technology, the rapidly changing and competitive nature of the digital audio, consumer electronics and entertainment markets, the Company's inclusion in or exclusion from governmental and industry standards, customer acceptance of the Company's technology, products, services and pricing, risks related to ownership and enforcement of intellectual property, the continued release and availability of entertainment content containing DTS audio soundtracks, changes in domestic and international market and political conditions, risks related to integrating acquisitions and other risks and uncertainties more fully described in DTS' public filings with the Securities and Exchange Commission, available at www.sec.gov. DTS does not intend to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made.

IFC to lend Rs 1,800 crore to Tata's power project

International Finance Corporation (IFC) on Wednesday said it will lend $ 450 million (Rs 1,800 crore) to Tata Power for setting up the 4,000 MW Ultra Mega Power Project at Mundra in Gujarat.

IFC, which is a member of the World Bank Group, received the approval of its board to advance the amount for the $ 4.2 billion coal-fired power project that will supply electricity in five states of western and northern India.

In addition to supplying electricity to industrial and agricultural users, Tata's Mundra project will serve 1.6 crore domestic consumers, said an IFC release.

The first of the power plant's 800-MW units is expected to be commissioned in mid-2011, while the other units would be launched at intervals of four months each.

The ultra mega power project, which Tata's won through a competitive bidding process, will create 5,000 jobs during construction and 700 jobs once it becomes operational.

Of the total project cost of USD 4.2 billion, IFC will provide $ 450 million with a repayment of period 20 years, the release said, adding that long-term financing will improve the risk profile of the project and will facilitate funding from local banks of around 15 years maturity.

Other lenders to the project include Asian Development Bank ($ 450 million), Korean ECA ($ 800 million) and local banks ($ 1.5 billion), besides an equity component of $ one billion.

Complimenting India for using super-critical technology for coal-fired projects, IFC Director Rashad Kaldany said, "The project will encourage other developing countries to make responsible choices, using best available technologies and applying higher environmental and social standards."

BSE speeds up its IPO plans

The country's leading bourse Bombay Stock Exchange (BSE), is speeding up its initial public offer plans. Asia's iconic exchange believes that it is not about money but more about providing liquidity to its investors.
The trading of shares will start once BSE gets listed on its own platform.
NDTV has learnt that the guidelines for a listing would come out in 4-5 months from SEBI, and BSE is upbeat about it.
“There are certain models by global players; we are working in tandem with SEBI for guidelines,” said Rajnikant Patel, MD & CEO, BSE.
This listing can prove to be unique in many ways as BSE will list without offering any new shares to retail investors through an IPO. It is sitting on enough cash reserves to fund its capex needs.
“Our listing plan is to provide liquidity to investors. We have enough cash reserves,” said Patel.
The Bombay Stock Exchange on Friday launched trading of Sensitive Index-based Futures on the US Futures Exchange (USFE) in Chicago.

"The IPO process might be completed very soon if everything goes smoothly”, Patel said.

BSE speeds up its IPO plans

The country's leading bourse Bombay Stock Exchange (BSE), is speeding up its initial public offer plans. Asia's iconic exchange believes that it is not about money but more about providing liquidity to its investors.
The trading of shares will start once BSE gets listed on its own platform.
NDTV has learnt that the guidelines for a listing would come out in 4-5 months from SEBI, and BSE is upbeat about it.
“There are certain models by global players; we are working in tandem with SEBI for guidelines,” said Rajnikant Patel, MD & CEO, BSE.
This listing can prove to be unique in many ways as BSE will list without offering any new shares to retail investors through an IPO. It is sitting on enough cash reserves to fund its capex needs.
“Our listing plan is to provide liquidity to investors. We have enough cash reserves,” said Patel.
The Bombay Stock Exchange on Friday launched trading of Sensitive Index-based Futures on the US Futures Exchange (USFE) in Chicago.

"The IPO process might be completed very soon if everything goes smoothly”, Patel said.

Religare takes a different route

Domestic brokerage firms that have thrived thus far in the retail segment are now chasing the institutional segment aggressively. Some players such as India Infoline Ltd and Anand Rathi Securities Ltd have hired key people from foreign stock broking houses CLSA Asia-Pacific Markets and Citigroup to build their institutional businesses. Religare Enterprises Ltd has taken a different approach. It has decided to buy Hichens Harrison and Co. Plc., a London-based broking firm, and the company says it is part of an exercise to build the institutional side of its business.

Religare’s shares have been among the worst hit in the market correction that started in January. At current levels, it’s almost exactly halved from its peak of Rs729 in January. The market’s concern is understandable. Religare’s growth thus far has come from a rapidly expanding retail broking distribution network and from a thriving margin funding business. Both segments have been hit as a result of the correction and the resultant drop in volumes.

Under margin funding, a client normally has to pay only 40-50% of the total value of purchase of each scrip, with the rest being provided by the broker. The investor has to pay an interest charge on the money brought in by the broker, which variesbetween 12% and 16% a year. If the investor is unable to meet the ongoing, or maintenance, margin requirement, the broker has the right to sell the scrip.

The institutional business is generally more stable (not that it doesn’t get affected), and the addition of Hichens Harrison will result in a well-needed diversification. In fact, the company had already told analysts and investors more than six weeks ago that it was looking to acquire a UK-based broking firm to augment its institutional business.

Yet, that’s not all Hichens Harrison brings to the table. The company is an approved nomad in the Alternative Investment Market (AIM) of London, or a broker which is allowed to introduce firms to list on the exchange. Companies that wish to list on AIM have no choice but to go through a nomad. Since many Indian companies use the AIM market to raise funds, having Hichens Harrison in its portfolio will help Religare tap this segment in the country. Further, Hichens Harrison has established offices in six emerging markets and had plans to open new offices in Qatar and Singapore in January.

The deal will give Religare a vast reach and help tap clients in each of these countries who want to invest in India. What’s more, the deal doesn’t look expensive, at about 13 times of past earnings. Interestingly, the markets have been lukewarm to it, with the Religare stock up less than 1% in the past week. But it reflects more of the mood the markets are in currently. A few months ago, this would have led to a surge in its shares.

Also note that the deal is still not a given. There could still be a counterbid. Trading in shares of Hichens Harrison had practically stopped since the deal became public, with an average traded volume of 13,000 shares with the shares not trading at all in one trading session. But last Friday, volumes soared to 940,00 shares, the highest in at least a year. With so many shares changing hands close to Religare’s offer price, it seems a section in the market is hopeful that a higher bid would soon arise.

Buying growth at Nitin Fire Protection

The shares of Nitin Fire Protection Industries Ltd (NFPIL), that manufactures, erects and commissions fire protection and security systems, moved up 4% on Monday on news of it acquiring Dubai-based New AgeCo. Llc.. The terms of the deal haven’t been disclosed, but the stock went up on the reasoning that it expands NFPIL’s footprint in a part of the world that benefits from high fuel prices and will hopefully be immune to slowdown worries.

However, the acquisition is not the main reason for the bullishness in the company’s stock. Reports say New Age’s revenues in fiscal 2008 was just Rs44 crore, around a third of NFPIL’s estimated turnover for the year. But that turnover will get a big boost this fiscal year, thanks to NFPIL’s CNG (compressed natural gas) cylinder manufacturing plant at Visakhapatnam in Andhra Pradesh that began production last February and which analysts say will stabilize in the current month.

Analysts estimate that the company’s turnover could triple in financial year 2009, largely because the firm diversified into manufacturing CNG cylinders.

Moreover, since the margins on these cylinders is higher than on fire protection systems, overall margins will increase and operating profit growth will be even higher than the growth in revenues.

Of course, the expansion is old news and the market had pushed up the stock to a high of Rs666 last January on the strength of that. Although it has corrected significantly since then, it has fallen far less than the Bombay Stock Exchange’sSmall Cap index. NFPIL currently trades at around Rs460, which is a valuation of around 12 times last fiscal year’s earnings, not taking the acquisition into account.

Demand for CNG cylinders is expected to grow robustly in countries such as Iran and Pakistan and that should help to absorb any increase in raw material costs. The icing on the cake is provided by the lower effective tax rates since the Visakhapatnam plant is located at a special economic zone, and is eligible for tax benefits.

Market Cues

Market cues:

• FIIs net buy $ 338.3 mn in equity on Apr 4
• Provisional figure was net sell of $212 m
• MFs net sell Rs 162.5 cr in equity on Apr 4
• NSE F&O Open Int up by Rs 1,096 crore at Rs 54,385 cror

F&O cues:

• Futures Open Interest up by Rs 651 crore and Options Open Interest up by Rs 445 crore
• Nifty Futures shed 15 lakh shares in OI, at 3-pt premium
• Nifty Open Int PCR at 1.22 Vs 1.12
• Nifty Puts add 11 lakh shares in Open Interest
• Nifty Calls shed 3 lakh shares in Open Interest
• Nifty 4700 Put adds 2.5 lakh shares in Open Interest
• Nifty 4600 Put adds 2.3 lakh shares in Open Interest
• Nifty 4800 Put adds 2 lakh shares in Open Interest
• Nifty 5200 Call adds 1 lakh shares in Open Interest
• Nifty 5000 Call sheds 2.8 lakh shares in Open Interest
• Nifty 4800 Call sheds 1.6 lakh shares in Open Interest
• Stock Futures add 1.2 cr shares in Open Interest

Stocks in news: JB Chem, Bharat Forge, IOL Chem

Stocks in news:

• Board meetings:
  JB Chemicals to consider buy back
  Prism Cement, Vakrangee Software results
  Vyapar Industries on issue of convertible warrants
• Global update: Alcoa net profit falls 45% on higher input costs, falling dollar; Nalco, Hindlaco in focus
• Bharat Forge buys Sifcor of France - ET
• RIL strikes oil in Yemen - ET
• IOL Chem in talks with PE players to sell 5% stake, plans to mope Rs 80 cr - DNA
• Natco Pharma planning another patent fight against Pfizer's new anti-HIV drug Celzentry - Mint
• Indian ADRs:
  ICICI Bank up 6.8%, HDFC Bank up 6%, Sterlite up 5%
• S Kumars
  Ex-date for demerger of retail biz on Apr 24
  All existing F&O contracts will expire on Apr 23
• NMDC has sought hike in iron ore prices by 60% - FE
• Vishal Retail to step into cash & carry segment, plans Rs 700 cr expansion- DNA
• Few takers for exotic forex derivatives now - BL
• 3 groups infra fund exceeds $1bn target, PE show faith in India growth
• Auto cos may hike prices as they feel the heat of costlier steel prices
• CACP – Commission For Agricultural Costs & Prices which fixes SMP, says
  Difference between SMP & SAP has to be borne by the govet and not sugar mills: Sources
• Solrex Pharma Hikes Stake In Orchid~Chem To 11.39% From 8.06%
  CNBC-TV18 Reported Solrex Picking~Up Stake In Orchid Chem Yesterday
  Orchid Chem Was Up 16% Yesterday~On CNBC-TV18 Report
  Solrex Pharma Is A Partnership Firm~Floated By Ranbaxy Promoters: Srcs

Solrex Pharma ups stake in Orchid Chem to 11.4%

Ranbaxy has been making moves on Orchid Chemicals. It has quietly picked up 11.4% stake in Orchid through Solrex Pharma a group company.

It has been a rollercoaster ride for Orchid Chemicals. In the last one month, Orchid has been a takeover target for the country's largest pharmaceutical group Ranbaxy.

In March, Orchid's promoters liquidated over 7% stake in the market due to margin calls that took the promoter stake down to just 17%. This made Orchid very vulnerable for a take-over. And that's when Solrex Pharmaceuticals, a Ranbaxy promoter group company, entered the scene.

It has been quietly consolidating its stake in Orchid since the last week of March. Solrex has, in the past week, acquired 8.06% in Orchid Chemicals through open market transactions. The accumulation by Solrex started when the stock of Orchid Chemicals ranged between Rs 161 and Rs 175.

The Orchid Chemicals management holding is down to 17% from the earlier 24% after the margin calls were triggered. Orchid has a USD 200 million FCCB issue, which could lead to 35% increase in fully diluted shares. The company’s business growth prospects look good and its balance sheet stretched. The total debt of the company is Rs 1573 crore in FY08 estimates. Its operating cash flow was negative in FY07. The debt to equity is at 2.6 times versus the industry average of 1.5 times.

Solrex has bought the first tranch of 8% at Rs 161-175, which is just about 10 times FY08 estimates and at seven7 times FY09 estimates. Yesterday's additional 3.3% stake at Rs 197 is 12-times FY08 estimates and 8 times FY09 estimates.

Just a month ago, the stock was at Rs 230 and traded at 15 times FY08 estimates and 10 times FY09 estimates. The acquisition has come at very cheap valuations to Solrex. The company is showing a strong presence in the US generic market, in cephalosporin space.

The closing price as on Monday was Rs 207.

Ranbaxy's senior management and promoters were not reachable for comments. Orchid said they have been intrigued at the stake consolidation.
It is not clear whether this stake in Orchid is just an investment by Ranbaxy's treasury or whether it will eventually want a majority stake, as it did in the case of Zenotech.

Market sources say Ranbaxy promoters may possibly pick up more stake in Orchid through Solrex and finally take it to around 15%. Whatever the speculation, it is certain that Orchid has swallowed the right pill to grab more attention.

Govt for excise duty cut to curb steel crisis: Steel Secy

After cement last year, steel is in the eye of the inflation storm. Last week, inflation touched a 3-year high triggered by a sharp rise in metal prices. The price of steel is sizzling hot. Last week, the metals wholesale price index jumped 42.8% due to high raw material costs and demand supply imbalance. There were global factors also at play. Iron ore contracts were being negotiated at a 65% premium internationally. And this rubbed off on prices back home.
“Prices have gone up 55% globally and 25-30% in India in the last 3 months,” said RS pandey Steel Secretary.

So far, the government has stepped in with a slew of measures to rein in prices-rollback of price hikes in galvanized products and withdrawal of export benefits. Analysts expect further duty cuts and possible price control by the government. However, the Steel Secretary says regulation is not on the cards.

“We are not in a regulatory regime yet and don’t think the government will dictate prices. We will ensure that domestic availability of steel improves and further measures to disincentivise exports is under contemplation,” stated RS Pandey.

Despite this assurance, there is buzz that steel may be made an essential commodity. It remains to be seen as to how far the government is willing to go to control escalating prices, that too in a possible election year.