STOCK MARKET DESK

Academically, there is a direct correlation between stock market crash and property prices crash. Normally there is a time lag of approximately six months to one year between stock market crash and property prices crash. Whenever the stock markets have been passing through boom times, demand for and prices of property have gone high. Likewise, in depressed Stock markets, the property prices tend to soften. The reason for the relation between the two markets is that in rising market, the huge gains find real estate as the ideal place for parking funds leading to escalation in prices and in a falling market disposal of property is the quickest way to cover losses leading to a fall in property prices.

People who have lost heavily in stock markets are keen to dispose off their investments in the real estate market. Distress selling always depresses prices. Small builders facing financial shortage have to sell some of their property to meet financial requirements. Many other individual investors, who have purchased multiple properties with their own funds or loans for speculative purposes, now have to sell some of their property before prices go down further. Reports from Mumbai, Delhi, Bangalore, Ahmedabad and Coimbatore clearly indicate that property prices (specifically residential property) have dropped 10 to 15 percent in prices. Fresh buying has come to a screeching halt in all major cities. The stock market correction could result in real estate prices coming down by 15-20 percent over the next 3 to 6 months. If the demand does not improve prices would start moving down and It would not be a surprise if the prices drop by up to 30 to 40 percent in near future.

Indian-born steel tycoon Lakshmi Mittal is the richest man in Europe with his fortune estimated at a staggering 27.7 billion pounds, even as he emerged as Britain's wealthiest person for fourth year in a row.

Over all, the steel baron, whose wealth saw a whopping increase of 8.5 billion pounds in a year, is the sixth richest in the world, a rich-list published by the Sunday Times said today.

His company ArcelorMittal is now worth more than 57.2 billion pounds and the Mittal family's 43 per cent stake is worth 24.6 billion pounds.

According to the list, the Ambani brothers, Mukesh and Anil, although they have parted ways, together were rated as the richest in the world at a combined worth of 43 billion pounds, ahead of America's Walton family, owners of Wal-Mart (38.4 billion) and Microsoft chief Bill Gates (29 bn pounds).

There were two more Indian entries in the list of 50 richest in the world in 2008 - K P Singh (property - 15 billion pounds and Shashi and Ravi Ruia (steel, oil telecoms - 7.5 billion pounds).

Meanwhile, the Hinduja brothers, S P Hinduja and G P Hinduja, Chairman and President, respectively of the group were Britain's second richest with 6.2 billion pounds.

Leading NRI entrepreneur Lord Swraj Paul was the fourth among the ten richest Asians in Britain, the list said.

The London-based Caparo Group of 77-year-old Lord Paul, British Ambassador for Overseas Business, is making hefty investments in the booming Indian economy.

In 2006, its profits were 55 million pounds on 660 million pounds sales.

Ashok Leyland has said that it will invest Rs 30 billion for a new plant in Uttarakhand and expand capacity at its Ennore facility in Tamil Nadu, according to reports in media.

The Hinduja group’s flagship company is setting up a 50,000-unit capacity plant in Uttarakhand, that gives income tax and excise breaks to investing companies.

Fresh investments would also be used for new engine development in partnership with Austrian firm AVL, Ashok Leyland CFO K Sridharan told media. "The company will invest additional Rs 30 billion on the new vehicle plant coming up in Uttarakhand, besides expanding the plant at Ennore and engine development," Sridharan said adding that the first vehicle from integrated plant at Uttarakhand by April 2009.

Amid global uncertainties, the US Inc is bullish on India as an investment destination compared to other emerging economies, but wants the country to improve its intellectual property rights regime and infrastructure, a survey said.

The survey, which polled members and company executives of the US-India Business Council (USIBC), showed that a large number of respondents rated future economic growth in India as highly sustainable despite uncertainties in other global markets.

Further, a large section of respondents answered in the affirmative regarding their plans to invest in India in order to establish or expand their operations over the next five years, according to the survey conducted by Ernst and Young.

"India is, and will continue to be, a premier destination for investment," is the assessment of most of these respondents, it said.

India has said it will take measures to bring down steel prices, but would first wait to see if producers do it on their own.

"Let's see. If the steel companies do not do what they should be doing (reducing prices) then the government will do what it should be doing," Commerce and Industry Minister Kamal Nath told PTI in Dubai on Thursday evening.

Already, five major steel producers including SAIL, Tata Steel and Essar have decided to hold the price line for up to three months after an appeal by Prime Minister Manmohan Singh not to manipulate prices for short-term gains.

High steel prices are partly to blame for soaring inflation, which rose to 7.33 per cent for the week ended April 12. Steel has seven per cent weightage in the wholesale price index-based inflation and has contributed significantly to rising prices in the last few months.

The government had earlier withdrawn export incentives on primary steel items. Nath said the government has taken some decision and steel companies have said they would voluntarily bring down prices.

Earlier, Finance Minister P Chidambaram had accused steel and cement companies of behaving like a cartel. "Steel industry should be responsible to ensure that they are playing their part in containing inflation," he said.

Zee News Recommendation: Buy Price target: Rs79 Current market price: Rs55.6

Result highlights

• Zee News Ltd (ZNL) has delivered a blow-out performance for Q4FY2008. Beating our and the consensus estimates, the revenues from its operations grew by a robust 59.1% year on year (yoy) to Rs113.1 crore in the quarter. The net profit after minority interest zoomed multifold to Rs15.3 crore during the same period.
• The advertising revenues soared by 84% yoy to Rs86 crore, while the subscription revenues that had grown by a meagre 7.6% in M9FY2008 grew by 49.7% yoy and 36.3% quarter on quarter (qoq) to Rs22 crore. A break-up of its channels into existing and new businesses shows that the revenues from the existing businesses grew by a handsome 53% yoy, whereas the new businesses recorded a 153% growth in their revenues.
• The operating profit margin (OPM) for the quarter stood at 23.7% against –1.3% for Q4FY2007. Hence the operating profit grew to Rs26.8 crore against an operating loss of Rs0.9 crore in Q4FY2007. The improvement in the margins of the existing businesses continued and stood at 37.2% for the quarter. The operating loss for the new businesses declined from Rs15.3 crore in Q4FY2007 to Rs10.1 crore.
• Zee Marathi and Zee Bangla, which are number one channels in their respective genres, increased their gross rating points (GRPs) by 35.7% and 18.5% respectively over Q4FY2007, whereas Zee Telugu and Zee Kannada, which form a part of the new businesses, increased their GRPs by 74.3% and 123.4% respectively and have thus increased their market share to ~10.5% against 6% and 4.5% earlier. We believe that with the continuous gain in viewership the new businesses (excluding Zee Tamil) would break even by the end of FY2009.
• The company will launch Zee Tamil by the end of July 2008 against which it has charged Rs1.39 crore as expenses in the quarter. The south Indian regional entertainment diaspora is highly competitive. However, considering the Zee group’s established track record in entertainment and the size of this market, we remain positive on Zee News’ prospects in these markets. We believe that its entertainment channels in the southern regional languages remain the key drivers of its growth in the longer term.
• At the current market price of Rs55.6, ZNL discounts its FY2009E and FY2010E earnings per share (EPS) by 23.7x and 18.1x respectively. We maintain a Buy recommendation on the stock with a price target of Rs79.

The Indian Steel Industry, is today acknowledged for its product quality. This is reflected by trends of rising exports and Indian companies mark in the global Mergers & Acquisitions market. From the fledgling one-million tonne capacity status at the time of Independence, India has now risen to be the 7th largest crude steel producer in the world and the largest producer of sponge iron. The steel industry now accounts for a capital base of Rs. 90,000 crore and contributes around 6 per cent of the Gross National Product, commanding a weight of 5.13 in the Index of Industrial Production and provides direct employment to more than 4 lakh people from being a negligible global presence.

The first major change came during the first three Five Year Plans (1952-1970), when in line with the economic order of the day, the iron and steel industry was earmarked for state control. From the mid 50s to the early 70s, Government thus set up large integrated steel plants in the public sector at Bhilai, Durgapur, Rourkela and Bokaro.

Indian stock market has emerged as one of the worst performers globally in the first three months this year, with concerns of a possible slowdown in the US economy and surge in commodity prices impacting sentiments of emerging and developed equity markets, a report says.

According to a monthly review by global index provider Standard & Poor's, the world's emerging and developed equity markets were hit hard during the first quarter of 2008, losing 10.56 per cent and 8.95 per cent respectively, during the period.

Among the emerging world equity markets, 15 of the 26 countries lost ground during the January-to-March quarter this year with India, China and Turkey emerging as the worst performers.

During the first three months in 2008, Indian equity market lost 28.55 per cent, while China and Turkey witnessed a fall of 24.65 per cent and 36.62 per cent respectively.

However, emerging markets which managed to give positive returns despite the global concerns, include Pakistan, Morocco and Chile, which emerged as some of the best performers during the first quarter of this calendar year.

Pakistan stock market has provided a return of 10.25 per cent in the reviewed period, Morocco performed robustly giving gains of 23.81 per cent and Chile gave 8.5 per cent positive returns, the S&P monthly global stock market review said.

As the market is very volatile these days borrowing and investing in the stockmarkets now is not a good strategy to follow. In this case, your stock market profits will first be used to service the debt taken and after that the left over will be your profits. In fact, it is quite possible, in order to increase the returns, since a major chunk goes towards interest payments, the investor might be forced to take higher risk (for higher returns), which could be well over his/her risk appetite. Moreover, it would serve as double whammy if the stockmarkets were to go into a correction mode again.

Power equipment supplier Bharat Heavy Electricals (BHEL) has recorded a 17 per cent rise in net profit to Rs 2,815 crore in FY08 on the back of a 15 per cent jump in turnover at Rs 216.08 billion.

Its annual turnover has jumped two-and-a-half times from Rs 86.62 billion in FY04. “We aim to be a Rs 500 billion company by 2012,” said Chairman and Managing Director K Ravi Kumar.

During FY08, the company got orders worth Rs 502.65 billion, taking its order book to Rs 850 billion.

It has also formed an equal joint venture with power producer NTPC for setting up power plants and taking up engineering works. BHEL will also enter with an agreement with Nuclear Power Corporation of India (NPCIL) on Friday to set up nuclear power plants in India and overseas.

"There has also been a 1 per cent increase in cost of raw materials such as steel during the fourth quarter,” Kumar said.

According to analysts, higher wages and raw material prices were likely to result in lower profits in the fourth quarter of FY08 compared with the comparative previous quarter.

The joint venture would also take up engineering, procurement and construction activities for nuclear power projects in India and abroad, BHEL Chairman and Managing Director K Ravi Kumar told journalists.

Mukesh Ambani-led Reliance Industries has submitted an over Rs 300 billion proposal for setting up two manufacturing facilities under the government's scheme to promote semiconductor technology.

Till now, the government has received seven investment proposals totalling Rs 65,000 crore from six companies. Besides Reliance Industries, Videocon Industries, Moser Baer PV Technologies, Titan Energy System, KSK Energy Ventures Pvt Ltd and Signet Solar Inc have submitted their plans with the Department of Information and Technology (DIT), an official statement said.

Proposals received are for manufacture of wide variety of items like Polysilicon, single/multi-crystalline ingots, wafers, solar cells, solar photovoltaic modules (SPV) liquid crystal display (LCD), integrated circuits-advanced logic/memory/embedded system on chip including assembly, test, mar and packaging facility for semiconductor devices.

"The investments are envisaged over a period of ten years," the statement said. Under the special incentive package scheme, the central government has to provide incentive of 20 per cent capital expenditure during the first 10 years for the units in SEZs and 25 per cent of the capital expenditure in non-SEZ units.

Domestic steel producers, including Tata Steel and Rashtriya Ispat Nigam Ltd, have told the government they will cut prices by Rs 2,000 a tonne on long products like TMT bars used in construction while most producers agreed to roll back prices of roofing materials like galvanised corrugated sheets by Rs 500 to Rs 1,000 a tonne. This is the second price cut by steel companies at the government’s behest in the calendar year. In February, companies agreed to a cut of Rs 1,500 to Rs 2,000 a tonne but raised prices by Rs 2,000 to Rs 2,500 a tonne in March. “This is a voluntary measure but there is no assurance to increase, decrease or hold prices beyond this,” said R S Pandey, steel secretary, after a meeting with major steel companies. Companies that export high-end steel products after processing HRC have agreed to buy the entire requirement internationally under the advance licence scheme that allows duty-free imports against exports. This may boost domestic availability by 2 million tonnes annually, he added.

This is an important investment practice one should abide by strictly. Keep strict targets for yourself and do not hesitate to sell a stock when its price target is achieved, beyond which, it is just over-expectations and market momentum that takes over the stock. Similarly, to look at the other side of this, do not get emotionally attached to a stock. If fundamentals of a company change due to any unforeseen and unpredictable development (like a government policy), get rid of the stock. There is no dearth of investment opportunities in the market.

Moving ahead with financial reform measures, the Securities and Exchange Board of India (SEBI) has given a green signal to short selling by institutional investors (foreign as well as domestic) in Indian bourses. Simultaneously, SEBI has also mandated that all the institutional trades in cash market would be subject to payment of margins as applicable to the retail investors. Currently, institutions do not have to pay margin money for their stock market trades. The introduction of full-fledged Securities Lending and Borrowing (SLB) scheme will go with the introduction of short selling by the institutional investors. These proposals would come into play from April 21 onwards.

Reliance Industries will shut down nearly two-third of its 1,400 petrol pumps in next couple of weeks as it is unable to match the fuel price offered by state-run retailers, who get subsidy for selling fuel below the cost.

The company plans not to replenish petrol and diesel stocks once the existing lot at its retail outlets get exhausted. Reliance will close about 900 company operated petrol pumps and according to industry sources has sent internal mails for a phased closure.

The owner of nation's largest refinery suffered huge losses despite selling petrol and diesel at prices higher than the state-run retailers Indian Oil, Hindustan Petroleum and Bharat Petroleum. On an average, petrol from Reliance outlets costed between Rs 4 and 5 a litre more than the PSU pumps.

Reliance still lost Rs 3.4 a litre on petrol and Rs 5.8 per litre on diesel and had seen its market share fall from 14.3% to less than 1% in diesel.

Public sector retailers too lose Rs 10.93 on sale of every litre of petrol and Rs 14.66 per litre on diesel but the losses are made up by issue of oil bonds by the Government and discounts from ONGC, GAIL and Oil India. The same compensation is not given to the private retailers like Reliance and Essar.

The company had invested about Rs 4,000 crore in setting up close to 1,400 retail outlets for selling petrol and diesel in the country. Out of these, Reliance owns and operate about 900 outlets. The remaining 500 dealer operated pumps would continue to operate. Essar Oil which has set up 1,100 petrol stations in the country is not closing shop as yet, so is Shell which operates a handful of outlets in the southern India.

Taking a loss is not a pleasant task. No one likes to do it at all. If one is to be an active trader it will become necessary to take a loss from to time to time. It is inevitable that the necessity of taking a loss will face the individual trader.If the decision has been made to take the loss, this is not the time to try and get something a little extra to soften the blow. There are novice investors who have decided to take a loss on a stock and at the last minute place a limit sell order just above the current trading range. In most cases, the order is never filled and the stock either just sits there or drops lower. As time passes the numbers of these limits sell orders, just above the current market price, begin to grow in number.

This gathering of limit sell orders creates a phenomenon called overhead supply. Even if good news is forthcoming, the stock will have a difficult time rallying through all of those limit sell orders. It is possible that the overhead supply will begin to drift lower. The members of other traders realize the difficulty of the situation and begin to lower their limit prices. Some of these sell orders are executed and the price is driven even lower. This predicament can become time consuming and frustrating for the trader.

The solution is simple. Once the decision has been made to sell and take the loss it should be done as quickly as possible the money will then be available for purchasing better choices. The market sell order will accomplish this with the greatest speed.

The volatility in stock markets has forced investors across the world to pull out over US$700 million from funds focused on Asian market last week, while there was an outflow of as much as two billion dollars from the emerging market equity funds, says a report.

According to the emerging market fund tracking firm, Emerging Portfolio Fund Research (EPFR), global investors have pulled out from most of the emerging markets during the second week of March, as investors fretted about the loss of export competitiveness in the face of a slumping dollar and showed little confidence in the view that growth in key emerging markets is decoupled from the US economic cycle.

Investors pulled out US$ 2.01 billion of the diversified Global Emerging Markets (GEM) Funds, US$ 714 million out of Asia (ex-Japan) Funds and modest amounts -- around 0.1 per cent of assets under management -- from EMEA and Latin America Equity Funds for the week ended March 12 , the EPFR report said.

Among BRIC (Brazil, Russia, India and China) country funds, Russia was the only one to post an inflow during the reviewed period, while the funds focused on the BRIC region recorded outflows for the third time in four weeks.

However, strong commodities story provided some protection and flows out of Brazil and Latin America regional funds were a minimal 0.01 per cent and 0.02 per cent of assets under management, reflecting the regions close correlation with commodity prices, the report added.

Although experts and analysts tout that Indian economy being domestic led it is relatively insulated from the US led recession but financial liberalization has helped a great deal in maintaining an average growth rate of 9 per cent during the 3 years between 2005 and 2008.

Anil Ambani group's financial services arm Reliance Capital today launched its microfinance initiative here with tie-ups for two states, which it said would be followed by a national rollout soon.

Reliance Capital said it is joining hands with two Gujarat-based microfinance institutions -- MAS Financial Services Ltd and Vardan Trust -- as part of its initiative to enhance penetration of microfinance in the country.

The initiative was launched by group chairman Anil Ambani's wife Tina Ambani, who handed over the first disbursement cheques.

Reliance Capital said it plans to fund MFIs in Gujarat and Maharashtra in the first phase, and subsequently have a national presence.

"Our vision is to provide access to finance at the grassroot level by partnering with MFIs serving the rural and semi-urban areas. This initiative is in line with the groups commitment to play a serious role in bringing value to the lives of the underprivileged and the aged in India," Tina Ambani told reporters.

"The initiative envisages lending to MFIs, which would then be on-lending finances to Self Help Groups, Individuals and Joint Liability Groups as per their norms," Reliance Consumer Finance' Deputy CEO K V Srinivasan said.

Steel Authority of India Limited (SAIL) signed a shareholder’s agreement with Jaypee Associates Limited (JAL) to form a joint venture company called Bokaro Jaypee Cement Limited (BJCL), for setting up a 2.1 million tonne capacity cement plant at Bokaro.

Equity participation by JAL and SAIL in BJCL will be in the ratio of 74:26. The initial authorised paid-up capital of the company will be Rs 500 million raised through a debt-equity ratio of 70:30. The proposed plant will come up in two years’ time at an estimated cost of Rs 4.05 billion. It will manufacture cement using the slag generated by BSL’s blast furnaces. SAIL has decided to diversify into cement production in a phased manner.

Seven Indian firms, including Reliance Industries and Reliance Capital from the two Ambani groups, have been named among Asia Pacific's 20 best companies in terms of expected investor returns over next five years. The list titled "Tomorrow's Winners" prepared by global investment banking giant Morgan Stanley also includes telecom major Bharti Airtel, engineering and construction major Larsen & Toubro, Kishore Biyani-led Pantaloon Retail, infrastructure company IDFC and real estate firm Sobha Developers. "Of the companies selected, more than half are listed in either China or India. Many of these are capitalising on major secular trends, such as infrastructure investment and per capita consumption growth," Morgan Stanley said in a report. "The rapid growth of Asian markets, India and China in particular, has led to an unparalleled focus on the region and its businesses," it said, adding that these are the companies "that can build on their competitive edge over the long term and consistently deliver outstanding shareholder returns." "The companies chosen lead their domestic competitors and are strong enough to withstand competition from abroad. The majority operate in industries that have high barriers to entry," the report said. The list was prepared after reviewing companies, their industries and respective competitive advantage. Besides seven Indian firms, there are six listed in Hong Kong, two each in China, Taiwan and Korea and one in Australia. The Hong Kong-listed firms are Belle International, China Mengninu Dairy, Espirit Holdings, Li and Fung, Tencent Holdings and Cayman Islands-based Tingyi Holding Corp. The two Korean firms are Samsung Techwin and Woori Finance Holdings, while those from Taiwan are Foxconn Tech and Gemtek Tech. Shanghai Zhenhua Port Machinery Co and Shuanghui Investment, two other companies on the list, are listed in China at Shanghai and Shenzen stock exchanges respectively. About India's most valued firm RIL, Morgan Stanley said that its consolidated net profit and asset base would more than double in next five years.

Anil Ambani-promoted Reliance Power on Sunday said it will give three bonus shares for every five shares held by its shareholders. The board of directors at its meeting today considered and approved a bonus issue excluding promoters, as per which three shares would be allotted for every five held. This issue would benefit over four million investors in the company and the cost would be borne by the promoter group by way of diluting its stake.

India's industrial sector is likely to witness a slowdown and will remain in single digit throughout this year, as the country faces various headwinds like appreciating rupee, poor infrastructure and rising borrowing costs, global credit rating agency Moody's said.

Parsvnath Developers and Indiabulls Real Estate have come together to bid for ten prime location plots being offered by the Indian Railways for commercial development across various cities.

The two companies have already submitted the request for qualification (RFQ) for all the ten plots offered by Rail Land Development Authority (RLDA) in the first phase.

According to sources, Parsvnath and IBREL have entered into an understanding for the submission and bidding for the land offered by the railway ministry through RLDA and under the agreement, the RFQ for 10 locations have been submitted.

The objective under the agreement would be to design, develop, finance and to market the developed property, they said. The 10 sites which have been selected for commercial development in the first phase are located in Delhi, Kanpur, Gwalior, Visakhapatnam, Kolkata, and Bangalore. When contacted, a spokesperson at Parsvnath confirmed the development, but declined to share any further detail.

According to sources, both the companies have decided to join hands to bid for railway plots as IBREL is strong financially, while Parsvnath Developers has project execution capabilities.

There is about 700 acres of railway land in 107 sites across the country that has been shortlisted by the railway ministry for commercial development on public-private partnership basis.

The report of the feasibility study for commercial development of the 10 sites spread over 265 acres of land has been submitted to the RLDA. The study conducted by the IL&FS has recommended construction of group housing societies, integrated township and marketing complex in these places.

RLDA, a statutory authority under the railways ministry, was set up by an amendment to the Railways Act, 1989, for the development of vacant railway land for commercial use.

Having emerged as one of the top performers in the equity markets in 2007, India became the fourth worst performer among all the emerging markets in the first month of 2008, with a loss of close to 16 per cent, according to financial market data provider Standard and Poor's.

"If investors thought the market could only go up, January's wake-up call pulled them back into reality," S&P said in its monthly update on world equity markets. The global stock markets lost a whopping US$5.2 billion as bearish sentiment prevailed across both emerging and developed markets to mark one of the worst ever starts to a new year, S&P said.

"There were few safe havens in January as 50 of the 52 global equity markets ended the month in negative territory, with 25 of them posting double-digit losses," S&P's Senior Index Analyst Howard Sliverblatt said.

While developed markets registered a loss of 7.83 per cent, the loss was even bigger at 12.44 per cent in emerging markets during the month. All the 26 developed markets posted negative returns, with 16 of them losing over 10 per cent. The overall trend in emerging markets was also disappointing despite gains seen by Morocco (10.17 per cent) and Jordan (3.11 per cent).

Among emerging markets, Turkey was hit the hardest losing 22.70 per cent followed by China at 21.40 per cent. Russia lost 16.12 per cent, while India lost close to 16 per cent, S&P said.

"High volatility, quick turnarounds in both the market and investor sentiment, and drastically lower stock prices prevailed throughout the month." Silverblatt said. Among developed markets, the US and UK lost 6.07 and 8.85 per cent respectively.

Public Issue Open: February 04, 2008 to February 07, 2008. Public Issue Type: 100% Book Built Issue (Initial Public Offer IPO). Public Issue Size: 117,389,914 Equity Shares of Rs. 10/-»» Face Value: Rs. 10/-. Public Issue Price: Rs. 725/- to Rs. 850/- Per Equity Share . Maximum Subscription Amount for Retail Investor: Rs 100,000/-. Listing: BSE, NSE.

Analysts say that RPower will have a market capitalisation of Rs 101700 crore compared with NTPCs current market capitalisation of Rs 221630 cr. While RPower has plans to implement 28,200-MW capacity BY 2016 with no assured returns in many projects and little experience in large project execution, NTPC already has 27,904-MW capacity with plans to set up additional 22,100 MW. Most of NTPCs projects enjoy assured returns and it has one of the best track records of power-project execution. From this what do we study??? If Rpower is more than 400 on listing day NTPC should also be more than 400. This is a minimum assumption, so buy NTPC as much as you can and be ready to enjoy high profits within short time.

As Many of us are aware of the current market volatility, I request all those who read this blog to be cautious in prevailing market condition. According to the experts it would take another two or three months for market stability. These are times of uncertainity for all investors in stock market. This is especially true for those investors who are interested in the very short term and who are churning their portfolios frequently and are conducting numerous intra-day transactions. In this scenario my advice to such traders to be wise and also not to enter into futures and options segment. Volatility of stock prices has risen significantly and hence it is advisable to be careful while trading. However, as and when the opportunity arises, vigilant investors must take advantage to invest as much as they can. But should not expect immediate returns as the market would take its own time to get good returns. After investing as much as i can, now I have decided not to get excited about any news or market trend or rumours. Just relax and sleep for few months and wake up when the market has woken up.

Bottom Line to my dear readers: Goodnight and sweet dreams!

You might have heard a saying “be greedy when others fear and fear when others are greedy”- warren buffet. I guess this is the strategy used by many investors. Last week created a lot of pressure for me as there was a big fall in the stock market almost all days. In the last few days the Sensex has reached below 20000- point level and lost over 1814 points in the past five days. The Sensex, which remained on a downward march in the last few days, plunged by 687.12 points to 19,013.70 yesterday. It touched the day's low of 18,930.42. This is the fourth biggest fall in absolute terms in the stock exchange history after the loss of 826 points on May 18, 2006, 769.48 points on December 17, 2007 and 717.43 points on October 17, 2007. There was a high selling momentum by many investors. This made me to invest a lot in companies which are fundamentally strong as i do not want to miss this opportunity. I have a strong belief that the market would get stable within few weeks.

This is one of the biggest IPO’s ever! Reliance Power to issue 26 crore equity shares of Rs 10 each. Reliance Power has fixed the issue price band for the IPO at Rs 405 - 450 per share. For Retailers we can apply at 430 rs ,which is approximately less by 5% of the issue price.so we get at discounted rate by 20 rs. This is believed to be the first to offer a discount in the IPO price for retail investors. Reliance Power has also fixed convenient payment terms for all categories of investors. The IPO is scheduled to open on January 15, 2008 and will close on January 18, 2008.

According to the experts in the beginning of 2008, the Market may stay steady but after the mid month of January, market may take rest and then it shall make correction. It is advised to get into some banking stocks like IDBI, ICICI, and SBI as it would remain bullish. In addition to that enter into power and infrastructure sector which is they key sectors for India in the coming years. It will definitely give good long term returns. In the hydrocarbon space, i like Reliance, ONGC, GAIL. In the metal space, i prefer integrated players like Tata Steel and SAIL. For time being this is enough.