Your questions on Heritage Foods, L&T Financial Holding and Apcotex!

Question: What you have to say about L&T Fin Holdings ? It was trading near its IPO price in the 40s for a year. Suddenly during diwali it was spiked to 88 levels. There are rumours regarding banking licenses and everything but it still doesn't explain this sudden rise. the company also has sold stake in federal & plans 125Cr debentures hence total incoming cash is around 500Cr in short time...but what the company is going to do with such cash is not known. from monday it is going into T Segment ..hence i am seeing downfall.. What do you think about this scrip?

The Great Indian Midcaps Sale!

Midcap stocks in Indian markets are currently available with heavy discounts in what is now known as "The Great Indian Midcap Sale" !! Not only Midcaps, but most Smallcaps and Microcaps, are available at a steep discount to their intrinsic Book Value and and in some cases, sale is as high as 50%, 60% or even more!

This is not the case in mainline Nifty50 stocks and BankNifty index, which are nearing their all time highs and will surpass that mark very soon. Lets look at some charts and compare...

Your question on Opto Circuits!

A valued reader asked this question:

Question: I hold 3000 shares of OPTO CIRCUIT @ Rs. 115, & want to know future about OPTO CIRCUIT.
Now-a-days it goes down & down.
As per my knowledge, it's a very nice stock, but FINAL IS YOUR VIEW.
If possible pls. suggest, what to do stay or quit.

Goldman Sachs Positive on India!

In case you have missed reading this from news reports:


Goldman Sachs raised India to 'overweight' from 'market-weight', citing growth recovery and inflation moderation ahead.

The investment bank pegged December 2013 Nifty target at 6,600 points.

Hindustan Copper OFS: The Art of Losing 9600 crores of market value to achieve 800 crores of stock sale!

Government is busy celebrating the good start of disinvestment program for 2012-13 with 5.5% stock sale in Hindustan Copper. Hindustan Copper is a marquee firm which is the only completely integrated Copper Producer in India. Copper, incidentally is a very valuable commodity and is the back-bone of all industrial and infrastructure growth world-over. Copper prices in international market often fluctuate with the slightest movement in economic data released by countries like China which are big consumers of this commodity.

Timbor Home Stock Analysis: Only listed Indian firm in Modular Kitchens!

Timbor Home is an Indian manufacturer and retailer of Modular Kitchens, Solid Wood Furniture and Doors. Timbor is the only listed Indian firm focused in Modular Kitchen space, which is an aggressively growing niche space in view of increased spending by Indians on their homes and kitchens. The modular kitchen space is expected to grow at about 50% YoY for the next few years. Timbor has about 20% market share in India in branded modular kitchens.

How to Invest in Commodities like Platinum, Silver, Copper, Lead and Zinc!

Investors are often looking for alternative asset classes to invest their savings, other than the traditional options available to them like Mutual Funds, Insurance, LIC Schemes and Bank Fixed Deposits. The recent run away rally in Gold and craze for Gold in India and China is pointing to the fact that Investor’s trust in paper currencies and financial assets is at all time low. Investors believe that Stock markets are subject to manipulation and Currencies are subject to devaluation and rightly so. There is a substantial pent up desire to invest in newer asset class like commodities. Investors are lapping up precious metals like Gold Jewellery and Silver bars and coins from both hands. But because of this herd run, Gold is at all time high and Silver has become highly volatile, subject to sky high prices and sudden pullbacks. So are there any other commodity options to invest and how can Retail Investor benefit from them?

Your chart based query on Zicom and Shilpa Medicare!

A valued reader asks a query on charts for Zicom and Shilpa Medicare:

Question: Just wanted to cross check with you on chart patterns which I am looking at the charts correctly , please do reply:
1. Shilpa Medicare --- 310 breakout point of a inverse Hn s on weekly time frame with volume action target high 400 ish .
2. Zicom security ------ Rounding bottom on weekly at 90 with volume action , Target HIGH 149ish?

Curious case of Money Matters Financials Services Ltd!

A valued reader asked this question on Money Matters Financials Services Ltd:


Question: There is this one counter that I'm very bullish on and bought at 97 levels...now it is at 130 odd....had made a peak of 787 in 2010...into financial sector...main business is lending business...it has ZERO NPA.....book value at 232...networth of co is 824 cr...

Ya forgot to mention the stock is Money Matters Financial services....

Also with rate cuts from may be Jan...it would get benefited, I believe...

Naren, can you kindly do some technical as well as fundamental analysis of the same and throw more light as to whether it can be a good long term investment.

(Naren, also note....there was a CBI raid in 2010...n it has crashed to 44...but then I learnt, that it has got a clean chit...news not confirmed about clean chit though)

Your questions on SpiceJet, RS Software and Zylog!

Question: What is your opinion on RS Software?  Enjoy reading your blog. Thanks.

Answer: RS Software - I had a quick look at financials, numbers look good. Price run-up has been strong till date. Now trading at 2.5X of book value. Can correct slightly from here. Need to analyze in depth, but overall looks good to me.

More questions:

Shakti Pumps Stock Analysis: Growth Stocks!

Shakti Pumps is one of those growth stocks, for which the saying goes, Buy High and Sell Higher. The scrip has doubled from the lows of 29.75 where it was trading in the beginning of 2012 and there is a long way Shakti Pumps can travel from here.

Shakti Pumps manufactures submersible pumps, motors and application pumps for a wide range of industrial and agricultural applications. Shakti is among the few companies in the world to produce 100% stainless steel submersible pumps and motors. The firm differentiates itself by energy efficiency of their pumps and has 5-star energy ratings for several of their pump models.

Glodyne Technoserve: Destruction of Shareholder Value!

In response to my post on Zylog Systems here, I got a few comments to write about Glodyne Technoserve as well. Glodyne is not on my radar, hence I had a fresh look at charts and financials for this firm. Looking at the charts for Glodyne truly filled my heart with pangs of sadness, as this momentous crash has the footprints of thousands of investors trapped in the debris.

This is the same story for folks trapped in firms like Tulip, 3i Infotech etc. So a common theme across midcap IT firms in last 2 years, was to take huge debt and buy firms abroad at lofty valuations. When these arcane diverse businesses did not add up to a meaningful large picture, it created tremendous destruction of shareholder value. The process was to over-leverage the firm by taking up debt and as the interest rates moved up due to money supply tightening in past 2 years, these firms are now unable to pay debt, or to pay salaries on time and hence these erstwhile IT midcap names are reduced to 100-200 crore microcap stature.

Pl look at Glodyne chart below:

Tara Jewels IPO!

At StockFundoo, we are never super-excited about IPOs. This is because investors in most of the recent IPOs are in deep red and have lost significant money. Please see our post on recent IPOs here. 

From this post:

Out of the last twenty large/mid-sized IPO listing, only seven are in profit and thirteen stocks are in losses, six of which have lost more than 80% of their listing price. This phenomena is going on from quite some time, where promoters of companies go for IPOs listing at exorbitant prices and cash on quickly, thus leave investors holding worthless stocks which are down by 80% to 90%. The most common saying about IPO is rightly so: It's Probably Overpriced.

Lets look at available data for Tara Jewels IPO, which opens tomorrow 21st Nov:

Short term Bottom on Zylog Systems!

We wrote about Zylog Systems few days back here, on how stock was crashing to Lower circuit on daily basis, on the back of possible Bear Cartel and Rumor mongering. Today, there is a possibility of short term bottom on this scrip, with huge volumes of trading getting reported and stock moving 4% up in intra-day trade. As market is still not closed for the day, we don't know if this is for real, but Zylog is worth a close watch from today onwards for a possible short term revival.

Please see the volumes reported in this scrip:

Are Commodities in Bear Grip? Not Really!

Sometimes I think financial analysts are really hired just for showing lot of worry and concern on TV every morning. Analysts world-over are worried about Commodity prices from 2011 onwards, citing recession in Europe, in USA and in China, which is a great guzzler of commodities like Copper. However, unlike 2008, where commodity markets fell off the cliff in just a few months, last two years of slowdown has almost done nothing to ease commodity prices. This is despite everyone being very bearish on commodities and commodity stocks. We see TV anchors talking about great impending slowdown in commodities from past two years on a daily basis. But is it really this bad, or this is another case of everyone being bearish, except the one who matters - Mr. Market. We need to look at data and figure out if commodity prices are indeed softening or this is just a consolidation phase for the next up-leg in commodity markets.

Nifty falls off the (US Fiscal) cliff today!

Nifty Index had a particularly bad day today, with US Fiscal worries weighing high on markets globally. The Nifty Index fell from a Intra-day high of 5662 to Day Close of 5566, which was Day's lowest point as well. Thus the intra-crash for Nifty was almost 2%, a significant crash. Similar was the case for other indices such as BankNifty and Midcap index. Midcap Index fell about 56 points, which is fall of almost 2.5% in Midcap index intraday. Day close for Nifty was about 1.2% lower than previous day close. Please see the EoD chart for Nifty-1M below:

Modus Operandi of Bear Cartels: Zylog Systems Stock Crash!

Zylog Systems is in dramatic lower trend since past one month. For the whole of this November, Zylog Systems is crashing at market’s open and moving immediately to lower circuit limit with huge volumes. This has plunged the price to 75 Rupees at today’s market open, which is about 80% lower than 335 Rupees where Zylog was trading at just a few months back.

Top 5 All-Time Best Books on Investing!

Investing is one of those skills which take just a week to learn but a life time to perfect. And what’s better than reading classic investment books to learn and perfect this skill to nurture your life with returns and rewards. Here is a quick review of Top 5 All-time best books published in the world of Investing, which are simple and easy enough for a non-finance professional to read and understand the basics of investing. With hundreds of new investment books appearing on shelves each year, a Top-5 short list is very difficult to determine. But some books are just irreplaceable with the sheer genius of writer and their marquee content. Here is a quick insight into what is best at the investment book shelf:

HAPPY DIWALI!

We at StockFundoo.com wish all our readers a Very Happy and Prosperous Diwali!

Wishing you and your family loads of happiness and prosperity.

Check out our Model Portfolio here, which will guide you through Great Returns in the coming new Year 2013!

Shree Ganesh Jewellery House Stock Analysis: Insight into Indian Jewellery Industry Business Model!

Although Gold and Diamond are shining at their pricier best currently, Jewellery companies listed on bourses are not at best of their price range. In this article, we look at business model of Jewellery companies, and how some firms are mitigating these issues. Also are some companies available at truly wonderful value prices now? How can value investors benefit from this mayhem, let’s have a look and decide.

Guide to Dividend Investing: How to Profit from Rich Dividend Paying Stocks!

Dividend is your share of the annual or quarterly profits that a company has declared over a period of time. Dividends are regular payments made by companies to their shareholders and are considered tax-free in the hand of shareholders in India. When you purchase stocks for investment and are shareholder of a given company, the company can either pay part of their annual profits to you in the form of regular dividends, or the profits can be reinvested in the company’s business. Typically, it is seen that companies willing to share their profits with their shareholders do well over a period of time, as their stock gets good visibility among investors and is traded at good premium over other stocks.

How Obama v/s Romney Presidential Election can affect your Portfolio returns?

Stock Market is nothing but an aggregate or sum total of daily activities of millions of investors, traders and institutions who buy or sell on a given day as per prevalent sentiment, political and economic realities. Political situation in any country affects the stock market morale due to economic policies of particular parties and general elections have the potential of changing the course of economy of a country. And when the country in question is United States of America, the policies affect not only the domestic economy of USA, but the whole world, and especially countries like India which have strong business ties with USA.

How Obama v/s Romney Presidential Race in USA will affect your portfolio? 

Why High Frequency Trading (HFT) is not so profitable anymore!

High Frequency Trading, or popularly known as HFT, is a set of trading algorithms which aim to profit by lightning fast trade executions in electronic trading markets. More than 30% of currency trading in world markets and about 90% of stock trading in exchanges like NASDAQ is carried out by computers using HFT algorithms. These HFT algorithms buy and sell shares rapidly, typically in milliseconds or less, and their total share holding period is fraction of a second. Unlike the typical investor, which buys and holds the stock for a few months or so, HFT algorithms average stock-holding period is just about 11 seconds! And how do they make money in 11 seconds, let’s have a look: