Some of my group's multi bagger picks during the rally were NMDC , MMTC , STC , Larsen ,Jindal Steel & Power , Unitech , BF Utilities , Jai Corporation , Walchand Nagar Industries, RNRL , Reliance Infra (Reliance Energy) etc.
I had been long associated with a corporate engaged in financial services , where with the assistance of specialized tools along with my special analysis as per some historical accepted theories of stock market like W. D. GANN's Theory , Elliot Wave Theory and others are used with reliable insider information of so called " operators" who play a major role to make a stock ,a Multi Bagger ,I do make my gem picks in this market.
I had been running my group , where the associated people get the reliable and most beneficial to get the unexpected return as seen in the above mentioned tips. Say for example the stock called MMTC had jumped from 2000 level to 56000 per share of historical price where the capital appreciated by 28 times in very short period with 2700% return on capital employed. Likewise in RNRL we started accumulating at RS 25 level from where we saw it moving at 250 level giving 10 times with 900% return.
These sort of return is helpful as ,
1. Handsome gain will make a jack to our capital.
2. Limited stocks trade , as daily trade could be avoided , which is more risky.
3. Long term capital gain , so no tax liability.
4. Whole income in white, which could be further deposited into fixed deposit to get assured monthly income later.
5. Strong income tax file without paying any taxes.
Saturday, March 28, 2009
My View On Aries Agro Limited
About The CompanyThe company is into manufacturing of micronutrients and other nutritional products for plants at Mumbai, Hyderabad, Bangalore and Kolkata. Aries Agro had gone public in December 2007 to raise funds to set up new units at Ahmedabad, Lucknow, Medak and a new unit in Maharashtra. Its unit at Medak has gone on stream and recently it set up micro-nutrient manufacturing unit at Lucknow. The fourth unit planned in Maharashtra is to be implemented by end of June 2009. This is expected to take the aggregate capacity to 100,800 MT.
Aries Agro declared its consolidated financial performance for the third quarter ended 31st Dec 2008. And as expected, it was no great shakes, infact very disappointing.
YoY, its net sales for the quarter rose 7.33% but EBIDTA fell 69% at Rs.2.70 crore and net profit was down at a paltry Rs.53 lakhs, down 89%. Tax provision was down and that helped the company stay in the black. OPM was down at 8.69% compared to 30.29% in Q3FY089 and NPM was down at 1.71% from 15.52% in Q3FY08. This is pathetic performance knowing that the company has been in commercial existence for the past over 35 years, with over 41 brands, 4,700 distributors, 67,000 retailers and 60 lakh farmers.
The company has explained that the reduction in profit was due to the unprecedented fall in the prices of key raw material. The stock of raw material has been valued at market value wherever the same is lower than cost as required by relevant accounting standard.
About The Stock
My View On Cipla Limited
About The Company
The most recognized company for its variety and quality product in pharmaceuticals sector. The stock has been fancied in the pharma sector for long time and share holders has been rewarded from time to time in lieu of Bonus , Dividends and appreciation in the stock price.
Cipla has formed two new partnerships in US and Canada. It has two drug launches on anvil – budesonide inhalers in Germany and Portugal and salbutamol MDI in Denmark and Portugal. Cipla has one of the widest product ranges, with a presence in about 65 therapeutic categories.
Currently, like many other Indian pharma companies, Cipla’s consignment too has been caught. Cipla’s export
consignment to Peru was seized at Amsterdam in early Feb 2009. This has been valued at around US$30,000 and the company blames this on the conspiracy of the Big Pharma, to ensure that Cipla’s generics drug does not reach the markets. One does not know the truth behind the allegations but this is a real problem which Cipla and many others are currently facing abroad.
About The Results
The company has posted results for the third quarter ended 31st Dec 2008, the reduction in operating costs, helped the company post a better performance. During the quarter domestic sales was up 11% and exports were up 37% and this was on account of a 59% rise in sale of formulations. There was not much growth in the API segment due to lower sales of some bulk drugs. During the quarter, Rs 78 crore has come in as income from technology know-how fees.
The reduction in costs was also on account of the depreciating rupee which improved on account of the improved exports. Exports are booked at prevailing rates and hence the company stood to benefit. It has provided MTM of Rs.42 crore due to net loss on revaluation of forward contracts. Tax for the quarter, as a percentage of profit before tax was lower due to tax incentives availed for EOUs, Baddi and Sikkim.
OPM for Q3FY09 was at 23.42% compared to 16.82% in QoQ and 25.94% on a YoY. NPM was up at 16.65% compared to 11.18% on a QoQ and it came down from 19.07% on a YoY.
Disclaimer : I do not have any personal holding in this stock.
My View On Hindustan Unilever Ltd
About The CompanyThe most recognized and reputed company of FMCG sector having a significant market ratio in the retail segment. The stock being heavy weight on the Indian capital market Indices , failed to show any performance even during the rally of 2005 to 2007 , when all index stock has outperformed and drag the Sensex to a record level of 21200.
About The Results
In the current quarter, the company is expected to have higher volumes and better margins as it will reap the benefits of the lower costs. Following the excise duty cuts and the fall in raw material prices like such as palm oil, LAB and HDPE; HUL reduced prices of its products and increased the grammage in select stock keeping units (SKUs) towards the end of January 2009. This is done mainly in its soaps and detergents segment, which is one of its biggest revenue earners.
There is no doubt the company is facing stiff competition from other FMCG brands and has been steadily losing its market share. Hopefully, the price reduction would help the company regain some of its lost market share. In the coming months, cost control and improving volumes would be the biggest priority. Profit margins are expected to grow more due to the fall in the raw material costs. Hopefully, the current tightening of the purse strings would soon get loosened, meaning more buying for HUL’s products. The company is expected to maintain its growth in the coming months.
About The Stock
FMCG stocks faced meltdown some days ago and this was after foreign brokerage JPMorgan Chase & Company cut rating on the stock to 'underweight' from 'neutral', citing weakening growth and increasing competition. But since then it has recovered remarkably.
My View On Indian Indices
What happened Last week?
Market is behaving , as history suggest with a contradictory view. It is always recommended to move against the majority's view as market has the power to overcome all general belief and prove every body wrong by showing a totally reverse trend and that is what we have seen last week.
Television and all reliable sources , where in favor of bearishness in the market with creation of new low and thereby majority has made a short or put option in the market , while as expected it has break all major resistance with ease giving a grand loss to all traders once again. Having support from good global cues and election mood it has successfully reached an unexpected level.
What were cause for such Trend Reversal?
The major reason supporting such reversal could be :
1. Mutual Funds buying for adjusting NAV at financial year end.
2. Short covering due to panic by reversal trend.
3. FII's buying.
4. Strong Global Cues.
What next?
That remain a major question behind all of us. The current scenario suggest that the market is at important level and could take turn towards any side with equivalent possibility.
My Personal View
As most of the major resistance has been broken there is a chance of reversal continuation in the market but we can expect slowdown in April due to following supportive reason
1. Short covering will be haulted due to end of clearing of March 2008
2. Mutual fund investment for NAV adjustment comes to an end after 31/3/2009.
3. Profit booking at these levels.
4. Major resistance at higher level.
Last but not the least , most expected and awaited major fall , to make new lows could happen with happening of any major catastrophic event dragging the Sensex to 6000 to 6500 levels , which is still expected with finger crossed.
This would be last and golden chance for investor to invest there hard earned money to get a handsome return in short to medium to long term.
Wednesday, March 25, 2009
Concept Of Technical Analysis
TECHNICAL ANALYSIS
Technical Analysis is the study of Price Chart, to get an idea about future price action of any traded stock. A Price Chart plots the quotes of a stock traded on a stock market. The "Price" discounts everything. Therefore, study of anything else is unnecessary.
How Technical Analysis helps an investors and traders?
Investors and traders can enter the stock (long or short) when it starts trending, instead of locking their money during the periods of consolidation. Traders may look for such trending moves in Daily (or shorter) charts, while the investors may look for such trending moves in weekly/monthly charts.
There is cause & effect relationship between technical &fundamental analysis ,though both holds equal importance. Fundamentalists studies the cause, while technicians study the effect. "Price" is the final result of all forces that can affect a stock. Price even discount the future, unknown news, while Fundamentals reflect the past. It is because of this reality, we often see tops being made on good news and bottoms being made on bad news.
Importance Of PE Ratio
'Buy low and sell high’ is the main principle to trade but the essence is to time you buy. To make money in a bear market, just buying and waiting isn't enough. You must buy only 'cheap' stocks. In order to get a sense of how expensive or cheap a stock is? you have to look at earnings relative to the stock price i.e the P/E ratio or the price-to-earnings ratio.The P/E ratio indicates the value of a stock in relation to the company's earnings. The P/E ratio of a company is computed by dividing its share price with its latest earnings per share (EPS), which, in turn, is the net profit divided by the number of outstanding shares.A high P/E ratio suggests the stock is in great demand, or that the company has bright growth prospects or competitive advantages.
Though PE is a useful parameter a stock is not necessarily cheap when it has a low price-earnings (PE) multiple. A high-growth company may be cheap even at very high PE multiples.The P/E multiple represents the premium that the market is willing to pay on the earnings based on its future growth. The ratio is most often used to conclude whether a stock is undervalued or overvalued. In effect, the ratio uses the company's earnings as a guide to value it. A variant of the P/E - called the forward P/E - has also been developed wherein the current market price of the stock is divided by the expected future EPS.
Big increase in earnings is an important factor for share value appreciation. When a stock's P/E ratio is high; the majority of investors consider it as pricey or overvalued. Stocks with low P/E's are typically considered a good value. However, studies done and past market experience have proved that the higher the P/E the better the stock.
Various quantitative and qualitative factors that impact the company should also be taken in to consideration & should never make a stock decision solely on the basis of the P/E ratio. Always read the P/E ratio along with. First, one can obtain some idea of a reasonable price to pay for the stock by comparing its present P/E to its past levels of P/E ratio. We compare the P/E ratio of the company with that of the market giving a relative measure.
Investor has to attempt to purchase a stock close to what is judged as a reasonable P/E ratio based on the comparisons made.Though we have to pay a higher price for a quality company with quality management and attractive earnings potential in spite of P/E ratio factor.
Unknown Concepts
Some of the popular terms of the stock market which we hear every now and then but most of us are illiterate about the topics and the importance they hold in stock market. Let us discuss the most popular ones.
1. Circuit Filters
SEBI has come with a set of rules to determine the fixed price bands for different securities within which they can move in a day to check the volatility of shares. As per Sebi directive, all securities traded at or above Rs.10/- and below Rs.20/- have a daily price band of ±25%. All securities traded below Rs. 10/- have a daily price band of ± 50%. Price band for all securities traded at or above Rs. 20/- has a daily price band of ± 8%. However, the now the price bands have been relaxed to ± 8% ± 8% for select 100 scrips after a cooling period of half an hour. The previous day's closing price is taken as the base price for calculating the price. As the closing price on BSE and NSE can be significantly different, this means that the circuit limit for a share on BSE and NSE could possibly be different.
2. Insider Trading
Informations which are sensitive in the form of influencing the price of a scrip, is procured or/and used from sources other than the normal course of information output for unscrupulous inducement of volatility or personal profits, it is called as Insider trading. Insider trading refers to transactions in securities of some company executed by a company insider. Although an insider might theoretically be anyone who knows material financial information about the company before it becomes public, in practice, the list of company insiders (on whom newspapers print information) is normally restricted to a moderate-sized list of company officers and other senior executives. Most companies warn employees about insider trading. SEBI has strict rules in place that dictates when company insiders may execute transactions in their company's securities. All transactions that do not conform to these rules are, in general, prosecutable offenses under the relevant law.Insider trading is illegal in India.
3. Going Short
If you do not have shares and you sell them it is known as going short on a stock. Generally a trader will go short if he expects the price to decline. In a rolling settlement cycle you will have to cover by end of the day on which you had gone short.
4. Stock Traded Under Demat Form
Securities and Exchange Board of India (SEBI) has already specified for settlement only in the dematerialized form in for 761 particular scripts. Investors interested in these stocks receive shares only in demat form without any instruction to your broker. While SEBI has instructed the institutional investors to sell 421 scripts only in the demat form. The shares by non institutional investors can be sold in both physical and demat form. As there is a mix of both form of stocks, it is possible if you have purchased a stock in this category, you may get delivery of both physical and demat shares.
5. Rolling Settlement Cylce
In a rolling settlement, each trading day is considered as a trading period and trades executed during the day are settled based on the net obligations for the day. At NSE and BSE, trades in rolling settlement are settled on a T+2 basis i.e. on the 2nd working day. For arriving at the settlement day all intervening holidays, which include bank holidays, NSE/BSE holidays, Saturdays and Sundays are excluded. Typically trades taking place on Monday are settled on Wednesday, Tuesday's trades settled on Thursday and so on.6/.
6. Important Facts for NRI'sIn India there is no borrowing of money or shares by your broker to make sure that the settlement takes place as per schedule. In Indian context, buying/selling on margin refers to building a leveraged position at the beginning of the settlement cycle and squaring off the trade before the settlement comes to end. As the trade is squared off before the settlement cycle is over, there is no need to borrow money or shares.
7. Badla Financing
The word 'Badla', literally means something in return. Badla is the charge, which the investor pays for carrying forward his position. It is a hedge tool where an investor can take a position in a scrip without actually taking delivery of the stock. He can carry-forward his position on the payment of small margin. In the case of short-selling the charge is termed as 'undha badla'.
Lesson From others Mistakes
1. We should follow a system or set of rules strictly without any sort of modification as per our needs and time gap.
2. Low priced, low quality stocks are dangerous and should never be put hands into it.
3. Greed is dangerous.Once a reasonable profit is made the investor should get out of the market quickly.
4. Do not fail to cut/book losses at 8% below the purchase price A strategy of selling while losses are small is a lot like buying an insurance policy. Once you've sold, your capital is safe.The 7%-8% sell rule is a maximum, not an average. Time your buys right, and if the market goes against you the average loss might be limited to only 3% or 4%.
5. Do not let emotions or ego get in the way of a sound investing strategy You may feel foolish buying a stock at 60, selling at 55, only to buy it back at 65. Put that aside. You might have been too early before, but if the time is right now, don't hesitate. Getting shaken out of a stock should have no bearing on whether you buy it at a later date. It's a new decision every time
6. Invest in equities for long term view then for short term prospective.
7. Do not make unplanned investing and starting without setting clear investment objectives and time frame for achieving the same.
8. Patience is a virtue in investing. Do not panic on your existing stocks.
9. Do not be unaware of what is happening around in the market. As always, knowledge is power and in investing, it's also a comfort. Dig for more information other than just the top stories that are flashed.
10. Do not put all your money on the same horse. Diversify your portfolio ideally into different stocks.
ELLIOT WAVE ANALYSIS OF INDICES
1. The action formed a bullish Piercing Line pattern on the Weekly chart of Sensex, with two consecutive gap-up actions on Thursday and Friday. These gap-up actions compelled bears run for cover.
2. The move is now getting closer to the b-d line of the suspected Triangle from ‘Oct lows. This line is now at about 8900-8950, which was broken earlier. We may, therefore, watch 9K levels for reaction if any.
3. Moving beyond 9K could put a question mark on Triangle assumption for the move since ‘Oct lows. That’s because b-d line of any Triangle should be clean.
4. Move above 9K does not, however, reject the Diametric I had assumed during the same period. I had said that “a bigger and faster downward segment will further confirm opening of the 3rd corrective. Lack of it would mean an ‘x’ label for the fall post Interim Budget.”
5. I have, accordingly, changed the wave label for the fall to an “x”, and another Diametric could now be forming. The “x” leg from 9700 to 8047, in effect, would join two Diametric formations.
6. Not many may be aware that “x” can be virtually any Corrective pattern, and can even be a Non-Standard or Complex Corrective pattern itself. In case it is a Complex Corrective, it usually joins two similar corrective, like a Double Three.
7. Alternatively, the 14-day fall from 9700 to 8047 could be “a” of “a” of 3rd corrective, and Index is now moving up as its “b”. In this case, since “a” (from 9700 to 8047) was a label of 3 (corrective), the “b” leg has to move above 9083, which is 61.8% retracement to “a”.
8. I had mentioned few weeks ago that since Jan’2008 all bear market rallies (except 1) lasted for 6 days. As long as the Sensex maintains a higher high and higher low each day, we can expect the 6-day phenomenon to unfold yet again. This would only mean that positive trend could continue for 4 more trading sessions. In such a case, we can expect Sensex to reach its highest levels of the move by coming Wednesday/Thursday, by which time the technical position would also reach an overbought zone.
9. However, the suspected corrective recovery in Dow can continue for more than 18 trading sessions. This could only mean that Dow may not break its most recent lows for a month. This reading could be relevant for all Global markets, includingIndia
10. As long as the Sensex doesn’t move beyond 9725 in faster time, the parameters for unfolding catastrophic scenario remain open.
11. If the current rally sustains beyond 9K, the time of occurrence would be postponed till until the second Diametric or “b” leg, as the case may be, is over.
12. As I argued earlier, with the help from such a catastrophic event, Sensex can create the lowest value, preferably near 6150-6500 as the final sell-off of the bear phase sets in.
2. The move is now getting closer to the b-d line of the suspected Triangle from ‘Oct lows. This line is now at about 8900-8950, which was broken earlier. We may, therefore, watch 9K levels for reaction if any.
3. Moving beyond 9K could put a question mark on Triangle assumption for the move since ‘Oct lows. That’s because b-d line of any Triangle should be clean.
4. Move above 9K does not, however, reject the Diametric I had assumed during the same period. I had said that “a bigger and faster downward segment will further confirm opening of the 3rd corrective. Lack of it would mean an ‘x’ label for the fall post Interim Budget.”
5. I have, accordingly, changed the wave label for the fall to an “x”, and another Diametric could now be forming. The “x” leg from 9700 to 8047, in effect, would join two Diametric formations.
6. Not many may be aware that “x” can be virtually any Corrective pattern, and can even be a Non-Standard or Complex Corrective pattern itself. In case it is a Complex Corrective, it usually joins two similar corrective, like a Double Three.
7. Alternatively, the 14-day fall from 9700 to 8047 could be “a” of “a” of 3rd corrective, and Index is now moving up as its “b”. In this case, since “a” (from 9700 to 8047) was a label of 3 (corrective), the “b” leg has to move above 9083, which is 61.8% retracement to “a”.
8. I had mentioned few weeks ago that since Jan’2008 all bear market rallies (except 1) lasted for 6 days. As long as the Sensex maintains a higher high and higher low each day, we can expect the 6-day phenomenon to unfold yet again. This would only mean that positive trend could continue for 4 more trading sessions. In such a case, we can expect Sensex to reach its highest levels of the move by coming Wednesday/Thursday, by which time the technical position would also reach an overbought zone.
9. However, the suspected corrective recovery in Dow can continue for more than 18 trading sessions. This could only mean that Dow may not break its most recent lows for a month. This reading could be relevant for all Global markets, including
10. As long as the Sensex doesn’t move beyond 9725 in faster time, the parameters for unfolding catastrophic scenario remain open.
11. If the current rally sustains beyond 9K, the time of occurrence would be postponed till until the second Diametric or “b” leg, as the case may be, is over.
12. As I argued earlier, with the help from such a catastrophic event, Sensex can create the lowest value, preferably near 6150-6500 as the final sell-off of the bear phase sets in.
'BHEL' OR 'L&T' ??????
About The Companies
Both are the leading entity of the capital good sector. Like wise both have een most fancied stock not only for capital good sector but in the entire capital markets.
Bharat Heavy Electricals (Bhel), the country’s largest power equipment manufacturer, managed to buck the slowdown but surely the flat bottomline is a pointer to some effect surely playing on the performance of the company. Compared to the superlative growth shown by L&T in Q3FY09, that of BHEL has been more subdued.
BHEL Financials
It posted a meager 2% increase in net profit at Rs.791 crore while net sales rose 21% at Rs 6,022 crore. Despite costs coming down, the cost incurred in raw materials remains a concern. Its consumption of raw materials amounted to Rs 4,059 crore, which was 67% of net sales as against 57% in Q3FY08.
Further the profit as compared to corresponding period of last year is also impacted by additional provision for wage revision. Staff cost during the quarter was up 23% at Rs.920.20 crore. For the 9MFY09, its employee cost is already huge at Rs.10197.70 crore, compared to Rs.11489.50 crore. Clearly, it will end the fiscal with a gargantuan wage bill.
Orders worth Rs.15200 crore were received during Q3FY09. The order outstanding was at about Rs.113500 crore. Every other day, we see that BHEL has received an order and most of the time, almost all the orders are big ticket orders. This, to a large extent is reassuring as it means the company is showing no signs of a slowdown. It has enough orders to keep it busy and the cash registers ringing for the current fiscal.
Both are blue chips and a must in any valuable portfolio. Right now, in this scenario of slowdown, BHEL has a march over L&T on two counts – firstly, over 60% of the orders of L&T comes from the private sector and hence it could face some slowdown if the companies decide to cut down on their capex or postpone it for later. For BHEL the order backlog is huge and for BHEL, it’s a question of how and when to complete rather than what to complete. L&T has been cautious when it announced 30% guidance for FY09 and its current takeover bid of Satyam is also causing some jitters. Mind you, L&T also remains a great buy, we are in no way negating that.
My View :
Both the stock have tough competition and both need to be part of one's portfolio while My personal vote would be casted for undoubtedly "Larsen & Toubro".
Disclaimer : I do not hold any of the above shares right now.
My View On GATI Limited
About The Company
The most well renowned company in courier service has been bought in to focus when news drive about the plan of the company to acquire the remaining 26.28% stake in trucking company, Kausar India through an open offer. The logistics firm, which is the sole promoter of Kausar India, currently holds 73.72% in the firm. Gati plans to de-list Kausar shares from the Delhi Stock Exchange and Ludhiana Stock Exchange Association following the acquisition. It will acquire Kausar's shares following a reverse book building process. The offer opens on March 23 and closes on March 25,
About The Company
The company has posted results for the second quarter ended 31st Dec 2008, the financial performance of the company clearly reflects the effects of the slowdown. Gati reported a 99% decline on a YoY in net profit at Rs 14 lakh. Its net sales rose 16.7% to Rs 157.04 crore. Operating Profit Margins was down at 6.4% vs 7.54% last year second quarter. It posted a MTM loss of Rs 17.5 crore. Net profit was down mainly on account of losses in air freighter business. Losses for the first half of FY09 amounted to nearly Rs 16.4 crore.
About The Stock
The financial performance of the company is bad to say the least. It has just about “managed” to show a net profit. Any fresh investment in same or to hold the position would be a bad idea.
Disclaimer : I do not have any personal holding in this stock.
My View On Asian Paints
About The Company
One of the leading industry in its field is not an exception to the slowdown in the economy.Affected by the biggest slowdowns in two sectors – realty and automobile. With both the sectors being its main consumer and with both having slowed down, naturally, the going looks grim for Asian Paints. Its other main revenue earner - repainting in existing homes was its biggest earner in Q2. But with a slowdown all over and people losing jobs also on the rise, repainting also took a hit in Q3FY09.
About The Results
Company has posted results for the third quarter ended
Main Cues Of the Stock
2. Low demand is now the biggest concern.
3. After the reduction in excise duty, even if prices are lowered, there may not be remarkable increase in its demand.
No major rise could be expected before any remarkable change in economy on positive side. Any fresh investment at present times would be a bad idea.
Disclaimer : I do not have any personal holding in this stock.
My View On Bharti Airtel
About The Company
One of the biggest player with largest network coverage and strong customer base and vast growing network in telecom sector. It is called as the undisputed leader of its field. The stock has been fancied much now days in the capital market too.
About The Financials
The compnay has posted results for Quarter 3 , Its overall customer base as at
For Q3FY09, the company posted a total Revenues of Rs. 9,633 crore (up 38% Y-o-Y). Its EBITDA stood at Rs. 3,945 crore (up 33% Y-o-Y). Its cash Profit was at Rs. 3,755 crore (up 30% Y-o-Y). Its net profit for the quarter rose 38.34% at Rs 1,976.41 crore.
Negative Cues
1. CEO and Jt MD Manoj Kohli of Bharti Airtel sold off his entire holding of 1.23 lakh shares for over Rs 7.2 crore, there was a major sell off on the counter.
2. TRAI would be cutting the domestic termination charges. Telecom analysts feel that this would result in cheaper calls for users but is expected to impact the large GSM players.
Positive Cues
1. Bharti’s strength remains its reach into remotest of the villages, which now stands at over 4 lakh villages.
2. It launched its services in
About The Stock
One of the best option in the telecom pack for medium to long term view. In panic this stock could be worthy buying.
Disclaimer : I do not have any personal holding in this stock.
My View On Bharat Forge
About The StockThe Company was incorporated on 19th June 1961Mumbai. The main object of the Company is to manufacture forgings and finished crankshafts. This has been one of the most fancied stock of the capital market.Bharat Forge has three plants in
About the Results
An almost 70% cut in production during the third quarter, especially in October, led to the overall fall in performance.
The slowdown is expected to continue, especially in the automotive sector till the first half of FY10. Currently 80% of its revenue comes from the auto sector and taking lessons from this slowdown, it has decided to turn this mix from 80% to 60% by 2012 and to a meager 25% by 2015.
Some Cues In the Stock
1. The company is making moves to increase its presence in the non automotive sector, which is largely related to energy, infrastructure, marine and railways.
3. It expects to have a major stake in the power sector in the coming years. But till then, atleast in the coming few months, FY09 and first half of FY10 looks grim.
About The Stock
Disclaimer : I do not have any personal holding in this stock.
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