Wednesday, 20 February 2013

Morning Bells (20 Feb 13)

Good Morning Friends.

When it comes to choose Friends & Books, then be careful, because Friends influence our Character and Books influence our Thoughts.

Oh! What a fantastic day for all and specially for our blog readers who booked handsome profit y’day.

Well, market ended in the green for the second straight trading session on Tuesday. The benchmark indices ended near their day’s high as the NSE Nifty rebounded almost 65 points. The market was stuck in a narrow trading range in the first half; however, a sudden bout of buying in the last hour of trade in scrips across the sector prompted the upmove.  Finallly NSE Nifty closed at 5,939, up 41 points over the previous close. It earlier touched a day’s high of 5,947 and a day’s low of 5883. It opened at 5,900.

Finance minister P Chidambaram has cut its market borrowing by Rs. 120 billion. The move is aim to satisfy the credit ratings agencies that have warned India with a sovereign downgrade if measures are not taken to reduce the fiscal and current account deficits.
“On review of the government of India’s cash position and funding requirement, it has been decided, in consultation with RBI (Reserve Bank of India) to reduce the government market borrowing through dated securities by Rs. 12,000 crore for the current financial year,” the finance ministry said in a statement on Monday. The auction scheduled on Friday was the last one for the current financial year.

Bob Dudley, BP Group Chief Executive and Mukesh Ambani, Chairman and Managing Director of Reliance Industries Limited (RIL) met with the Indian Minister of Petroleum and Natural Gas, Dr Veerappa Moily in Delhi today. They updated the Minister of their joint future plans in India, including the KG D6 block enhancement plan designed to increase production from the block.

BSE and S&P Dow Jones Indices announced a strategic partnership to calculate, disseminate, and license the widely followed suite of BSE indices. The partnership brings together BSE’s closely watched India index suite, which includes the SENSEX, with S&P Dow Jones Indices’ 115 years of experience in publishing uncompromised global benchmarks.

The BSE, the oldest exchange in Asia established in 1875, 137 years ago, currently maintains 30 stock market indices measuring the Indian market. The SENSEX is the flagship index of BSE   launched in 1986 on a market-cap weighted basis to measure the performance of 30 component stocks representing large, well-established, and financially sound companies across key sectors in India. The Index is one of the most prominent brands among Indian investors.

Gainers – Wipro, Infosys, TCS, ICICI Bank, BHEL, Tata Steel, ONGC, Dr Reddy’s Lab, Bajaj Auto, Sesa Goa, Hindalco Inds, Sun Pharma, NTPC and Mahindra & Mahindra were among gainers in Sensex and Nifty.

Losers - RIL, L&T, Bharti Airtel, Hero MotoCorp, Coal India, Jindal Steel, Gail India and HDFC Bank were the major losers in Sensex and Nifty.

Sectoral - The BSE Realty index was the top gainer, up 2%, followed by BSE IT index up 1.7%, BSE Healthcare index added 1.4% and BSE Power index gained 1.1%.

According to various experts market is optimistic about the Budget as of now given the promises made by the government in the last few months, it will be watching the event closely to see if the finance minister will deliver on these commitments.

Deputy Chairman of Planning Commission Montek Singh Ahluwalia is expecting a good budget from the Finance Minster.

Speaking on the sidelines of the Abid Hussain Memorial Lecture, Ahluwalia said, “"It's not a good idea to speculate on the budget. I am sure we will get a good budget."               

A huge agenda has been listed for the session including the introduction of 16 new legislations in addition to the 40 legislations that will be put up for consideration as well as passing. These legislations include the big-ticket Insurance Bill, the Pension Bill, the Companies Bill and of course UPA's showpiece, the Food Security Bill, along with the Land Acquisition Bill.

As far as the financial agenda of this session is concerned, the session has the Union Budget on the February 28 in addition to the Railway Budget as well as the economic survey.

MG’s view on Budget -
Most of experts are hoping for their gains i.e. market friendly budget but my sense is that this budget would be more for common man & basically will be focussed on pending reforms, yes as general election is there in 2014 and this would be last budget where Govt. can announce reliefs for common people.

Surprisingly Mid-Caps have fallen 10-40% in last two weeks. (Blue chips are drifting lower but second line shares went down much sharper.) Street has been expecting a lot from the Budget both in terms of policies and reforms and probably India the Budget is overhyped.

On Domestic Front –
The Finance Minister, P. Chidambaram launched the operations of India Infradebt Limited (Infradebt), the first Infrastructure Debt Fund (IDF) under the NBFC structure by handing over the first IDF – NBFC license to Infradebt in presence of the promoters, ICICI Bank, Bank of Baroda, Citibank and LIC.

On Global front –
Many experts believe that its not right time to judge equity market at the moment. They have some thoughts that while many global economies may have averted a default here and a decline there, the crisis is far from over. Don’t judge prematurely!

=====================  MARKET OUTLOOK  =====================
Market broke out from the trading range on account of lack of selling which triggered short covering in the indices. The current up move is likely to intensify further after Nifty takes out the intermediate high of 5969.

The INDIA VIX on NSE was down 3% and ended at 15.81 against previous close of 16.29.
FNO PCR is 0.82 against previous close 0.80.

Indian Rupee –against USD ended almost unchanged and was trading at 54.19 against its previous close of 54.19.

S&P 500 (US) was trading at 1527.67 up 7.88 then its previous close at the time of writing M Bells.

=======================  NIFTY OUTLOOK  ========================

Nifty is in range of 5780 – 5820 (100 DMA) - 5840 - 5900-5950-6040-6150-6190 for current series.

Resistance – 6028 – 5987 – 5963 and Support – 5899 – 5859 - 5835

Opening – After a good day, now again Nifty can show range bound as bears will try to give an attempt and to restrict Nifty to cross 5970. So start could be a bit positive say around 10+ points.

========================  STOCK OUTLOOK  ======================
(Stock outlook needs to watch stock movement carefully and then one can bet after having a look, I tried to put related info which will help you in taking positions.)

Jet Airways -
Jet Airways surged 3.2% after the company announced one of India’s biggest air ticket sale of almost 20lakh seats at fares as low as Rs. 2250 for travel anytime until December 31, 2013. The discounted tickets could be booked until February 24.

The share price has surged after hitting turbulence yesterday, shedding 8% after Etihad Chairman said that the company needs time to evaluate the Jet-Etihad deal in which the Abu-Dhabi based Etihad is mulling to buy a 24% stake in the Indian carrier.

Hotel Leela -
Hotel Leela was up 8.76% after the company sold off its Chennai IT park building for Rs. 1.7bn on Monday to Reliance Industries, the company declared in a BSE filing. The company’s board gave the approval on November 2, 2012 for the sale of the property.

Kingfisher Airlines was stuck at 5% upper circuit after the parent United Breweries (Holdings) hiked its loan limit for the airline to Rs 7.5bn from Rs 3bn. The statement came after the lenders to Kingfisher on Feb. 12 said that they would begin initial proceedings towards recovering $1.4bn of defaulted loans after Kingfisher failed to come up with a suitable repayment plan. The parent UB Group, of both Kingfisher Airlines and United Breweries, has declared that it could use proceeds from a stake sale in a separate group company to Diageo. United Breweries (Holdings) was up by 5% after the announcement.

McDowell -
The USL - Diageo deal may be in jeopardy after banks have recalled loans given to Kingfisher Airlines. Bankers told CNBC-TV18 that they could invoke the corporate guarantee of UB Holdings and file for liquidation of the company. This could endanger the transfer of USL shares owned by UB Holdings to Diageo, reports CNBC-TV18.

The recall of loans given to Kingfisher Airlines by consortium of banks can actually put the entire USL -Diageo deal in jeopardy. Lenders state that they can also invoke corporate guarantees given by UB Holdings as collateral for Kingfisher Airlines.

Essar Ports -
Essar Ports climbed 7% after the lenders the company released the pledged 42,083,396 shares which have been re-pledged with the trustees, the released shares make up 9.8% of the entire paid up equity capital of the company, the company declared in a filing to BSE.

MCX Stock Exchange (MCX-SX) will introduce Liquidity Enhancement Scheme (LES) in Equity and Equity Derivatives Segments with effect from March 6, 2013. The objective of the Scheme is to invite genuine participation and benefit all participants across various segments of the market from smallest of retail investors to largest of institutions for wholesome development of India’s Capital Market. It provides a level playing field to all classes of users to have wider reach and impact.

In order to develop the markets at the fundamental level, the Liquidity Enhancement Scheme has been structured to reach out to real investors and users so that the investors and members have the benefit of sustained and genuine liquidity. MCX-SX is the first national exchange in India to be offering incentives for liquidity enhancement in the Equity Cash Market.

Tata Motors –
Tata Motors -owned Jaguar Land Rover (JLR) has now started work on developing what would be the smallest sports utility vehicle (SUV) from the company till date. The proposed model is being developed in the UK.

Sources say the proposed SUV will focus on emerging markets like China and India, reports CNBC-TV18's Ronojoy Banerjee, quoting sources.

Sources indicate that the proposed SUV is going to have an engine capacity of around 2-litre and in comparison to the 2.2-litre diesel engine of the Evoque, one of the smaller SUVs from Range Rover, it will be the smallest vehicle to rollout from the company till date.

==================== OPEN CALLS ====================
# Please remember when I make special remark with any position then one should need to take care of that else you can make loss instead of profit.
# Be with strict SL and don’t hesitate to book even small profit if Nifty doesn’t shows strength.

Jain Irrigation 65CE – @2 TG 3.5+ SL 2 Lot-1(Active from 19 Feb 13)

RCom 75CE – @1.45 TG 2.5+ SL 1.45 Lot-1 (Active from 19 Feb 13)

=============== INVESTMENT BASKET ===============
(Stock in this section is with view of 3 months to 1 year)

Mahindra Holiday – @334 TG 375+ (Active from 15 Dec 12)

Satyam Computer – @103 TG 130+ SL 112 (Active from 15 Dec 12)

On Mobile – @44 TG 60+ Updated SL 39 Qty 2K (Active from 01 Jan 13)

============ PL Sheet (started from Jan 2013) ============
(If someone find any error in PL, please draw our attention)

MG Blog (Jan+25,900) + Feb Ser. = +6500

Billionaire Club (Jan +51,000) + Feb Ser. = +13,500 (ZEEL)

Today’s MG Mantra
Today I have one article for all of you, though I have told you all these repeatedly but its nice chance to recall all those instructions once again, so here’s the link –

Have a Profitable day – MG

Disclaimer –
1. I have shared my view as per my limited knowledge; please use your own skills to make a wise decision before execution of trade or consult your financial advisor.
2. Those that don’t have patience and are not willing to book loss also in cases don’t enter this market.


  1. Madhu - ha ha, sometimes I get surprised that still people are paying such a high brokerage in these competetive days. I pay only 35Rs including all. And even few people who have account with Zerodha pay only 40Rs flat per trade. And even you will be surprised, I haven't given any good margin, my margin was only 25K, but yes I continously hammered to my broker to leave his firm if he will not cut down my brokers, so started with 50Rs a lot to finally 18Rs settlement.

    Which means you are paying 100Rs per lot for both side.

    1. yes sir, Now Iam trying to open an account with ventura, they are offering 30/lot. Zerodha is also a good option.

  2. Be careful today, FII activity y'day -

    Total Puts add 4.3 lakh shares in Open Interest

    Total Calls shed 10.5 lakh shares in Open Interest

    Nifty options suggest mkt range of 5800-6000

  3. Mudra sir,any calls for today.. Jain irrigation again at 2.30 .. can we buy at this price now

  4. Sir
    Please suggest on unitech 35 ce.

    1. Hi Madhu its difficult to take a call on Unitech at the moment, as its was over sold and then some pull back bring it to 32 level, may be it remain range bound here and can go down to. I would prefer to stay away.

  5. MG Sir, RK Global has a flat rate of Rs.9 per lot (Futures as well as Options). It's not dependent on the number of lots also. I trade in 1-2 lots on an average daily and my brokerage don't go beyond Rs.35 (buy & sell & taxes).

    1. Is there any term for Margin or Advance brokerage, i.e. some broker asked to deposit 50K margin, or some ask to deposit 5-10K upfront brokerage.

    2. No sir. I have opened a normal account. No deposits whatsoever. I get 6 times margin for the cash that I keep in my account. So, if I have 50k in my account, I can trade using 3 lakhs for intraday. They don't give any margin for F&O, so that might be a concern. The brokerage is deducted on a daily basis from your account and they send an sms everyday with the details of the trades that I do.

    3. To top this, my intraday trades in cash also have a brokerage of only Rs.9 per trade (buy or sell) again irrespective of the amount (1 lakhs or 10 lakhs order, it's the same brokerage).

      Cash trades have high taxation. So, if I trade for 2 lakhs buy and 2 lakhs sell, my total brokerage usually comes around Rs.110 (this includes Rs.9 for each side + taxes).

      If someone does very heavy cash trading (more than 100 trades buy + sell) in a month, they can opt for a monthly package of Rs.999 and trade unlimited without any brokerage (taxes on actuals).

    4. They also have multiple options for trading terminal. I use a software that they have provided and it shows me live data. Very convenient to use and very fast. No waiting for placing a trade or fear of missing a spot price. They charge about Rs.300 per segment (for NSE Cash, F&O, Currency, etc.) for the software usage. I have taken 2 segments (NSE Cash + F&O) and I pay around Rs.580 per month for the software but it's totally worth it. If you call them to place an order, they charge Rs.25 per order but it's free using the software.

  6. TG almost achieved in Rcom - book profit @2.5 bought 1.45, total gain 4200/- CHEERS!!

  7. Hi,anybody knows any low charging brokerage firm they are having service centre in kerala?Currently doing with hedge equities and they are charging 50rs for one side brokerage for option,and .03% brokerage for future and intraday one side.Delivery type they are charging .35% one side.If anybody knows pls update.Thank you.