Category: Economy, Markets and Macro Views

Bajaj Electricals has seen a steady rally in the past few weeks ahead of this announcement. The stock had spurted 20% to Rs 503.60 in a single trading session on 16 May 2007 when the company first announced during trading hours that its board will meet on 29 May 2007 to consider bonus issue. The stock is currently trading at Rs 592, up 10%.

The company had last issued bonus in ratio of 1:2 (1 bonus share for every 2 held) in 1997.

The latest equity share capital of Bajaj Electricals is Rs 8.64 crore. The latest book value per share is Rs 90.59.

Bajaj Electricals manufactures a diverse range of products in three divisions: lighting, consumer durables and galvanised structures. It also undertakes turnkey projects of manufacturing and installing mobile, street lighting and transmission towers.

The company is a part of the Shekhar Bajaj Group with promoter holding a 66% stake in the company. It has five major strategic business units comprising home appliances, fans, lighting, luminaires and engineering & projects. It also manufactures, erect and commissions transmission line towers, telecom towers, mobile telecom towers and wind energy towers.

FLASHNEWS: The board of Unitech Ltd has decided to issue bonus shares in the ratio of 1:1.

The board also decided to cancel the existing authorised preference share capital and decided to increase the authorised share capital from Rs 200 crore (after cancellation of preference shares) to Rs 500 crore.

Unitech had given a liberal Bonus and a stock split last year.

Reliance Money, the e-Trading arm of ADAG has too many bugs in their online trading software which has causes huge loss to investors.

A customer, said that he sold 10,000 shares of Reliance Natural Resources (RNRL) at a profit and still his ledger balance was showing a debit 🙁

Other Common Glitches Faced by Investors are as follows,

• Limit based orders have disappeared.
• Executed Order confirmation given on next Trading Day [They should be given the next second]
• Franchisees admit to problems in software
• Transferring amount from UTI Bank to Reliance Money takes 4 days. JeeZ!!!

It is not uncommon to see Billing and Software errors in Ambani controlled companies. In 2003-04, their were tons of Billing errors in Reliance Infocom which caused the company to suffer more than Rs 100 crore loss. Ambanis are who are traders and oil merchants don’t understand the IT business 🙂

HDFC Bank is another bank which doesn’t understand the Online Banking needs of the User.

Merill Lynch has initiated coverage on India’s leading Real Estate Giant, Ansal Properties and Infrastructure Ltd [APIL] with a BUY recommendation and a target price of Rs 425, with potential returns of 27%. Recommendation is based on 1) Scope for strong earnings growth. 2) Potential upside of Rs127/sh to from Hi Tech City project at Greater Noida, is not included in current valuation. So effective Valuation will be Rs 425 + Rs 127 = Rs Rs 552.

APIL is expected to report an EPS of Rs 35.8 and Rs 70.7 for FY08 and FY09 respectively. EPSW growth rates are nearly 100%. APIL trades at a forward P/E of mere 9x and 5x. APIL has enough land bank to develop for the next 7 to 8 years. You may download and read the entire research report from here. [PDF]

Kalanithi Maran, who is the brother of Dayanidhi Maran, holds a majority 90% stake in the south-based media major. Maran is related to Tamilnadu chief minister and DMK supremo K Karunanidhi.

The Sun TV stock had plunged 7.2% on 14 May 2007 after Maran had resigned from the Union cabinet late evening on Sunday, 13 May 2007, following a directive from the DMK boss. The stock is off from a high of Rs 1,700 to Rs 1,300 currently. Read about the Dark Side of Dayanidhi Maran here.

The stock is currently trading 1:1 cum-bonus and also cum stock-split in the ratio of 2-for-1. As a result, the face value of the scrip will become Rs 5 instead of the present Rs 10.

Sun TV’s integrated growth strategy is to build a dominant presence in south India. It is a leading television broadcaster in all southern states of India. It offers four Tamil language channels Sun TV, Sun News, Sun Music and KTV as also two Malayalam channels Surya TV and Kiran TV, apart from Telugu and Kannada language channels.

The stock of Raj TV is consistently moving up after the fall of Dayanidhi Maran. From Rs 186 on May 14th currently the Raj TV stock is locked in upward circuit at Rs 318. It is rumored that the Karunanidhi Family is now backing Raj TV as DMK channel to counter any challenges from Jaya TV.

At 10:08 IST, the Nifty was up 43.85 points, or 1%, to 4,258.35. It hit a high of 4,259.65 in early trades today, 21 May 2007, surpassing its previous all-time high of 4,245.30, which it had stuck on 8 February 2007.

The 30-share BSE 30-share Sensex was up 134 points to 1,4437. The Sensex is till about 287 points away from its all-time high of 14,723.88 that it had struck on 9 February 2007.

Bank shares extended last week’s gains due to easing of inflation worries. State Bank of India (SBI) moved up 1.5% to Rs 1346, ICICI Bank nearly 1% to Rs 960 and HDFC Bank 1.3% to Rs 1086.50.

India’s wholesale price index rose 5.44% in the 12 months to 5 May 2007, lower than the previous week’s increase of 5.66% due to a high base the year before, data showed on Friday, 18 May 2007. The annual inflation rate was 4.37% in the corresponding week of the previous year.

Index heavyweight Reliance Industries (RIL) edged up 1% to Rs 1717.90. The stock hit a new all-time peak of Rs 1720. The scrip shrugged off media reports it is likely to miss the June 2008 deadline for commercial production of gas from the Krishna Godavari basin. The delay is mainly due to late deliveries of deepwater drilling rigs by Transocean Inc. RIL is relying on these oil rigs to the start the commercial production of gas from the basin.

The market had surged last week ended 18 May 2007 on firm global markets and on reports that there will be early onset of monsoon. Rally in two bank shares SBI, ICICI Bank and in index heavyweight RIL aided the rally.

The 30-share BSE Sensex 507.25 points, or 3.67%, to settle at 14303.41 in the week ended Friday, 18 May 2007. The S&P CNX Nifty rose 137.85 points, or 3.3%, to 4214.50 in the week.