949-228-7621 anilselarka@gmail.com

CONFUSED MIND CLEAR ANSWERS (2010-03)


Ref: 2010 – March of  1st March, 2010

2010 – Protocol to Observe before you post

I am starting today “2010, March series”. Post your February comments here using comment box at the bottom.

The Jan 2010 series will be archived in PDF and HTML format (to make it searchable) and is made available from Download center. DO NOT POST ANY QUERIES IN Feb 2010 – It will not be answered. Old entries not yet replied will be replied there by tomorrow.

I am making few changes. My reply will not be detailed as before. It will not be more than 10 lines at the most. If there is any major issue of concern or interest is shown by the readers, I will promptly address it in the form a separate post or page, so that repetitive query are not posted or answered, and the readers can enjoy only single point of reference for that issue.

The readers may note another important protocol. Please post your comments in the following format:

HEADING – Write in Capital letters, name of the stock enquired about or title of major issue as per reader’s choice. Do not extend beyond one line.

MESSAGE BODY

  1. Write your query or specific question very clearly.
  2. Do not use compliments for my predictions or assessments. Yes, you can criticize.
  3. Write each issue in one Para.
  4. Do not use essay form. Write to the point, do not be apologetic for anything nor bother about what I would feel about your post, just speak out your mind clearly.
  5. Use your normal word processor, to write your comments first, think over it, have it spell checked with proper capitalization, and then only post it.
  6. Make a standard format or template using the present protocol, so that you do not forget anything like your name, city etc.

At the END OF MESSAGE, please mention without fail

  • your Name (you can use nickname, but mention real name in the bracket as I do)
  • City
  • Country and
  • Date of posting (although I know it, but when I consolidate at month end, the program does not use the posted date. It is better you write the date of posting and time (not so essential)

Formatting your posts in above manner will make entire post pleasant, eye catching, and highlight the stocks or subject in such a way that other readers can scroll through easily to find what they want even from your message.

Kalidas (Anil Selarka)
Hong Kong,  March 1, 2010

MASTER INDEX (Last month on Top)

90 Comments

  1. Is it good time to enter in INOX @ 68 , Noida Toll Bridge @ 34 , Renuka Sugars @ 65, Tanla @ 47

    Kalidas Says ….Saturday, April 24, 2010
    Regret do not know any of them.

  2. I Have IOC  50 @ 280 , RPOWER 50 @ 150 , DCB 100 @ 34 , DISHTV 100 @ 36 , SPICEJET 100 @ 55. I can hold for a year. Please let me know if it is a wise investment

    Kalidas Says ….Friday, April 23, 2010
    Yes, it is. Hold it for a year, and then we will talk.

  3. Dear Sir,
    I want to buy flat in Pune for self use (under construction, approx 25 lacs).
    Earlier in November & again in February, you had suggested me to wait till April.
    Do you suggest me to buy flat now or you expect some correction in real-estate in near term.
    I can wait another 3 months.
    Regards,
    Gaurav
    Pune, India

    Kalidas Says ….Friday, April 23, 2010
    Monsoon is around the corner when the Real Estates are low. Buy it during June to September season.

    The real estate market is hot. I was seeing correction due to global market fall, but it is not happening. Since your apartment is for self use, search for the best deal and buy it. Buy from reputed builder since you are buying the property under construction.

    Pune is the good place to invest.

  4. Can we accummlate HPCL @ CMP. Now its 300
    Tara. Mumbai. India

    Kalidas Says ….Wednesday, April 21, 2010
    Yes, if you are prepared for medium to long term hold. For immediate return, you may opt for Spicejet.

  5. Hi Kalidas,
     
    The US market was down on 16th April due to Goldman Sachs and it picked up again today i.e. on
    Monday 19th April 2010. I see a lot of strength in the US market. The pullback last Friday was after almost
    2 months in US.

    I am still short on MT (Arcellor Mittal) 750 shares. Shall I buy to cover them or wait for further pullback.
    People are just talking about the pullback in US but it never comes. The market has been very strong lately.

    Mahesh,
    New Britain, US
    19-Apr-2010

  6. I Have IOC  50 @ 280 , RPOWER 50 @ 150 , DCB 100 @ 34 , DISHTV 100 @ 36 , SPICEJET 100 @ 55

    Kalidas Says ….Monday, April 19, 2010
    so?

  7. Whats your suggestion on investing in ENGINEERS INDIA LTD Equity shares – for a one year time frame.

    Kalidas Says ….Monday, April 19, 2010
    Too expensive. Such capital intensive stocks usually command 8 to 10 times P/E whereas EIL trades at over 28. Good company, but every dog or horse has a price to trade.

  8. Dear Sir,
    For self use I am planning to buy a property soon. Apart from loan, I have to raise around 30 Lacs.

    My current asset allocation is as follows:
    1. Around 17+ Lacs in Indian Equities
    2. Around 8 Lacs Cash
    3. 1 Kg Gold
    4. 31 Kg Silver.

    To raise 30 lacs cash for property, what do you suggest as the best way from above allocation?

    Thanks in advance and eagerly waiting for your reponse.

    Kind Regards,
    Prakash
    Rotterdam, The Netherlands

    Kalidas Says ….Monday, April 19, 2010
    Depends on the equity allocation and location where you want to buy the property. In major centers like Mumbai and Pune, buying property for Rs 30 lakhs is not easy proposition.

    Further, if you want to buy the property for self use, it is another matter. If you want to buy for investment purpose (to get rental income or otherwise), I can only say that the rental yield in India is sub par.

    Repost your question with following details:
    1. Proposed location of the property
    2. Whether spot delivery basis or under construction.
    3. Investment purpose or self use.

    Since Housing Finance is relatively cheaper compared to deposit yield, it is advisable to use housing loan (for NRI) and let other investment remain same. Your cash resources will be employed in the Margin money. However, I would advise you to reduce non priority equity investments by 50% rather than using cash because in the event of correction, you may need them handy.

  9. Hi Kalidas,
    As market moved seem to have ignored many woes and moved up quite from near 4600 to over 5300, I was expecting technical correction back to near 5000.
    I was also watching the progress in Greece to see if they will default and how much that could affect the global trends. For now Greece issue seem to have settled with $40 billion funding by Euro Union.
    In this situation, with the quarterly results coming up shortly, What is your view on the market from a fundamental standpoint ?
    Are you expecting the rising interest rates, PIGS, US-China fall out or anything else to add to the woes and drive another round of strong corrections ?
    Regards,
    Aby Philip
    Bangalore, India

    Kalidas Says ….Thursday, April 15, 2010
    To me, the Indian market is fully priced at 18,200 but due to change in F&O lots rules beginning from 1st May, there is likelihood that SENSEX may rise to 21,000. This has nothing to do with fundamentals but just arithmetic. Watch for my article soon on this subject.

    Rates will rise slowly in the beginning but will speed up from Sep/Oct onwards. India has less propensity to show rise in interest rates, buyt RBI follow micky mouse policy, so it may raise the rates too that may destabilize real estates unless it excepts the rate rise for real estates.

    I do not expect any fall out in US-CHINA policy. Both follow carrot and stick policy. It is a tie game.

  10. ANNOUNCEMENT

    I have just returned to Hong Kong. It will take me about 3 days to reply pending enquiries.

    If you have already posted queries in April in the March column, they will be replied there.

    Please post your queries from today onwards in April column.

    Due to limited availability of internet at the places visited by me, and the odd hours (I was finding time only during night time when the Internet Café were closed), I could not reply on regular basis.

    Anil Selarka
    Hong Kong, 12 April, 2010

  11. Dear Kalidas ji,
    One of your recommendations Abhishek Industries is showing a fresh breakout and has quickly climbed to 18 levels from 14 over a few trading sessions. I have 2000@14.6. Do you think it is advisable to add more at these levels or wait for some more time?
     
    Another scrips I would like to add at current levels is Evinix accessories (already have 8000@4) and Ashtavinayak cine vision (1000@14)
    Regards,
    KeeYes
    Tokyo
    Japan

    Kalidas Says ….Thursday, April 15, 2010
    Whereas the revenue has risen, the profit has not. There is lack of transparency in forex related losses. As such, I am not so keen to increase the exposure just because the stock has begun to move up.

    The quantity you own is very small. May be use the rally to lighten up between 19/21 and then wait for correction. If the stock goes up in heavy volume, be a seller at 23.50

  12. Dear Kalidasji,
     
    Hope you are doing well.
     
    Re. the RIL/RNRL case, the arguments were finished during December 2009 and the verdict was reserved since then.  It is already about 4 months now.
     
    Is there any rule that defines for how long the verdict can be postponed after the arguments are finished?
     
    Look like the honourable judges are negotiating the deal with concerned parties, probably with RIL to sell its verdict for a good price.
     
    Appreciate yours as well as fellow readers views.
     
    Regds,
     
    Satheesh Nair,
    Taiz, Yemen.

    Kalidas Says ….Thursday, April 15, 2010
    There is no limit. My own case for recovery of Provident Fund, Gratuity and unpaid wages is pending for over 22 years, and accumulated amount inclusive of interest is Rs 2.88 crores.

    Supreme court judges are less prone to sale but they could be too if the price is right. They are mostly political appointees.

    I was in India for over 3 weeks – and had to face lot of corruption in India. The corruption has become so entrenched that it is difficult to differentiate what is real law and what is actionable law. It is a massive Corrupt India. I do not think that real growth like China is achievable in India where everything has price tag.

  13. Dear Sir,
    We are missing you here. I hope all is well at your end.
    Best Regards,
    Prakash

    Rotterdam, The Netherlands.

    Kalidas Says ….Thursday, April 15, 2010
    Everything is fine. I am also human, need to go out for personal or social work at times.

  14. Respected Sir,
     
    Gold in $ terms has crossed important technical level $1161/ounce. The undergoing CFTC hearings have dramatically exposed to the world the deeds of US Govt, allies and its banks in suppressing the gold. In the same hearings facts came out that ratio of paper gold to physical gold shorting by JPM & HSBC is 1:100 whereas market expected at worst scenario of 1:50. The other stunning facts are that Canada’s only bullion vault-ScotiaMocatta has 89000 ounces of gold ($100Million), whereas disclosed gold holding of the IShare Gold Trust in the very same vault which amount to 457000 ounces of gold.
    Silver demand in USA by investment leaped from 10 to 20% of annual production has risen to more than 100% of production.
    http://www.kitco.com/ind/Clark/apr092010.html
     
    Gold and Silver are poised for a good rally in the coming few weeks and your assumptions and targets appears to be achievable. Your absence is making us to put forward some of the doubts we are carrying.

    US is unable to sell its treasuries causing yields to raise which will affect stock market. But its market is also a managed market, how long it holds at current level nobody knows. The end result is market correction is getting postponed and there by our investment in the stock market.
    Since you advised us to invest only 25% of investible sum in the Precious metals can we enhance our limit
    At present scenario, can we expose our funds to the tune of 5% each in your recommended stocks like Abhishek, DishTV, Satyam, Petronet etc

     
    Waiting for your arrival and thereby your advice,
     
    Regards,
    V.S.Kumar, Jorhat

    Kalidas Says ….Thursday, April 15, 2010
    No, limit your investments in precious metals to 25% including silver. Keep 12% in gold and 8% in silver – both physical. As you have seen, if you keep these metals physically with banks, they lease it out to others without your knowledge. In worst scenario, they will raise their hand, and it is difficult whether you will get the real value of gold.

    A time is going to come, note it very seriously, when the paper gold will be quoted at substantial discount to physical gold. Almost all banks have lost their physical gold in leasing or shorting operations. If the bullion banks or vault banks go bankrupt, there will be huge crisis in gold which may require Central Bank’s intervention to save these “too big to fail” banks.

    This is the reason I had always advocated holding of physical gold against holding ETF or paper gold.

    For equity allocations, yes, you may use the 5% cap on each stock except Abhishek where it can be limited to just 3%

  15. Hello Sir,

    I hope everything’s well at your end. It has  been more than a month since you have been on this blog. I would appreciate if you couls let us know when  you would be  returning, if at all.

    Thanks for you time and patience in spreading the wisdom of knowledge.

    Sam
    Delhi, India

    Kalidas Says ….Thursday, April 15, 2010
    Already returned.

  16. Mr.Kalidas,
    Appreciate your valued guidance to new investors like me. I have been recommended by my friends abroad to buy CLENERGEN CORP  ( CRGE) since in the days to come this electricity based company shall give substantially good returns. KIndly favour with your very valued comments. thanks.

    Kalidas Says ….Thursday, April 15, 2010
    I am sorry that I do not know about this NASDAQ stock.
     

  17. Hello Sir,

    http://www.zerohedge.com/article/latest-gold-fraud-bombshell-canadas-only-bullion-bank-gold-vault-practically-empty

    A gold fan
    Tarun
    Dubai, UAE

    Kalidas Says ….Thursday, April 15, 2010
    Most of the physical gold and silver had been leased out to hedge funds and short sellers. They received in return security deposit. Thus, technically, the bank shows holding gold and silver based on the premise that the gold borrowers would return the gold.

    This is how US treasury lost title to gold for over 6200 tons although it shows on paper that it still owns and hold the gold. Read my chapter on Gold in my book SUBPRIME RESOLVED”

  18. Shree Ashtavinayak Cine Vision
     
    Dear Kalidasji
     
    Please read following news on BSE
     
    http://www.bseindia.com/stockinfo/anndet.aspx?newsid=fb09f12e-468d-441d-b7d6-70a91eeed722
     
    Shree Ashtavinayak Cine Vision Ltd has informed BSE that the Board of Directors of the Company at its meeting held on April 06, 2010, has resolved and approved the proposal of buy back up to maximum price of Rs 21.60 per share and up to Rs 25 Crores from Open market through Stock Exchange subject to the approval of members of the Company through Postal Ballot in compliance of provisions of section 77A and other applicable provision of the Companies 1956 and SEBI (Buy back of Securities) Regulations, 1998.

    Regards

    Suchitra NAIK
    Mumbai, India
    07.04.2010

    Kalidas Says ….Thursday, April 15, 2010
    They are trying to prop up the prices. Expect the prices within range bound from Rs 12 to Rs 16 for a long time. Once it exceeds Rs 18, then it will be trend reversal.

     
     

  19. Sir,

    Hope you are back from India. Eagerly  waiting for your return to the Blog.
     
    Shiva
    Bangalore
    India

    Kalidas Says ….Thursday, April 15, 2010
    Back again but will be traveling again in late May for about 2 weeks to proceed to USA for about 2 months. However, I will be active contributor from USA where I will have full internet access.

  20. Dear Kalidasji,

    Pl. inform us when you will be coming back regularly on this forum.We all are eagerly waiting for your reply.

    – Ramesh, Mumbai, India

    Kalidas Says ….Thursday, April 15, 2010
    Already back

  21. Kalidasji,
    Just came across the following article:
    http://www.moneycontrol.com/news/world-news/america-ison-track-for-downgrade-day_449713.html
    What’s your take on this?
    Also one more question – The Indian Rupee has appreciated against the Singapore Dollar from 33.74 to 31.5 (till date). Do you foresee a continual of this trend and if yes then what are levels you foresee for the next 2 years?
    Regards,
    Atul
    Singapore

    Kalidas Says ….Thursday, April 15, 2010
    Indian Rupee follows Yuan. The rupee is very tightly controlled by RBI/GOI, so there is no real market. This is why no views on 1 to 2 years. I take 5 year view that Rupee will rise to Rs 31 level against USD. Work out Sin$ with reference to USD

  22. GOLD, SELL ?

    Dear Sir,

    An interesting article i came across.

    http://www.moneyworks.ae/news_article.php?news_id=4201

    If you could pls comment on this.

    regards
    Mehr,
    Delhi,  04 Apr 2010

    Kalidas Says ….Thursday, April 15, 2010
    Ignore it. If Bond Yield rises, or bond prices fall or it means the interest rate rises, the only alternative safe haven is Gold.

  23. Guys- Chill out. I dont think we are going to get any replies from the owners for some time to come. At least a simple note from their staff would have been helpful. People get worried. concerned also waste time by checking the blog ever so often. It is a story of two extremes – earlier we were getting responses / views every hour of the day and now nothing for weeks.
    Cheers
    Manges
    3/4/10
    Boston

    Kalidas Says ….Thursday, April 15, 2010
    I do not have any staff. This is a one man show. I also have some obligations towards my family and business, and my visit to India was well announced. Your concern noted.

  24. Dear Sir,
    Hope you are find Sirji,
    We are eagerly waiting for you to express your views in this forum.
    Regards,
    Richie
    Coimbatore, India
     

  25. Sir,
    Please open a new page for April series.
    regards
    badrinath, bengaluru, india

    Kalidas Says ….Thursday, April 15, 2010
    I did
     

  26. Shree Ashtavinayak Cine Vision Limited has informed the Exchange that the Board of Directors at the meeting held on March 31, 2010 has resolved and allotted 68,19,621 Equity Shares of Re. 1/- each fully paid up at the issue price of Rs.43.98 per equity share on Conversion of FCCBs amounting to USD 7.623 Million into equity shares, in accordance with the terms and conditions of Prior-in-principle approval letters issued. The above shares shall be credited in demat account after receipt of Listing permission from the Exchange, to be followed by corporate action, and in terms of Special Resolution passed in the Extra Ordinary General Meeting held on January 18, 2010, 2,72,78,484 Bonus Shares shall be issued after obtaining Prior-inprinciple approval from the Exchange for the issue of Bonus Shares to FCCB holders who are allotted aforesaid equity shares on conversion of the FCCBs. ( As on 1/4/2010 15:45 hours )

    Mr. Vora
    Mumbai, India.

    Kalidas Says ….Thursday, April 15, 2010
    In reality, the effective conversion rate will be Rs 4.39 after accounting for bonus and split shares. The stock will begin to consolidate for at least months to digest the new share supply. Not much fire work is expected. The stock will be dud for at least 2 months, except occasional flashes upto Rs14 level.

  27.  Kalidasji,

    There was a announcement from DISH TV at NSE

    “Members of the Exchange are hereby informed that 20246392 partly paid up equity shares of Dish TV India Limited has become fully paid up on receipt of final call money. In view of the above, trading in above fully paid up shares shall be available under the ISIN No. – INE836F01026 w.e.f. March 31, 2010.”

    Could you let us know the impact of this?

    Thanks
    anoop
    chennai,india

    Kalidas Says ….Thursday, April 15, 2010
    It was already known for several months that the partly paid shares will eventually be fully paid up. That, they did and company got additional funds, it is a good news. The uncertainty is now gone.

    May be for a while, some arbitraging was going on. The right holders sold current equity and subscribed to right shares. The stock should begin to move up in less than 30 days

  28. Kalidasji is moved to the US and it seems it will take sometime to settle before we get replies.

    Kalidas Says ….Thursday, April 15, 2010
    Who told you that?

  29. I invested in LIC Money Plus (180) Growth plan, last three consecutive years @40,000/- each years. Today I calculated my average NAV purchase rate is @11.35
    As on current NAV (27-03-2010) rate is @11.58 Growth. Please suggest what I have to do with it, continue for more years or just withdrwal it and innvest some whare else.

    only 1.85% profit = loss ?

    Raghunath
    NOIDA, India

    Kalidas Says ….Thursday, April 15, 2010
    I do not normally invest into such schemes. I use pure vanilla Life Policies just to cover my life. I do not entrust my money to others for management. Take a loan against this policy and invest in Petronet, Uco Bank, Ruchi Infrastructure etc. This way your life is covered, your growth plan continues and you also use same money to invest into well deserved stocks

  30. Gold

    Sir,

    Gold has hit $1085 and seems to have found support there. You had suggested a range of $1085 to $1145. The numbers are matching very well. Fitch has downgraded Putrugal. US just had a poor treasury auction and infact USD rallied inspite of that. It all seems to add up to the conclusion of your last article “currency war has begun”.

    What do you expect next sir ?

    regards
    Mehr, 26 March, 2010
    Delhi, India

    Kalidas Says ….Thursday, April 15, 2010
    No change in strategy on gold and silver except, switching some position from gold to silver. We will enter real bull market in bullions before June this year.

  31. Respected Sir
    Sir we are missing u here, where are u still in India, and when u come back.. i can say in Hindi
    Aapki site pur ana addat c ho gayi hai…
     
    kuldeep

    Kalidas Says ….Thursday, April 15, 2010
    I am sorry to miss all of you. The fact of the matter was that while in India I seldom had internet access at right time. The Internet café used to open at 10:00 AM and closed at 10:00 PM. During this time, I was out on farm or some other personal work (like visiting hospital where one of my naphew was in coma for over 6 months).

    In any case, the markets were having sideway movements – with not much hefty gains.
     
     

  32. Sir- your view on Oil India at the current price of Rs 1107. Is it worth buying for long term – 2 to 3 years?
    Should we wait for correction to enter this stock?

    princeofindia
    Abu Dhabi

    Kalidas Says ….Thursday, April 15, 2010
    I still prefer smaller values like IOC, BPCL, HPCL, MRPL, Shivani etc. Selling one share of Oil India can give us well diversified exposure in same industry.

  33. Dear Kalidas Ji,
    We are missing you on the forum over here, eagerly waiting for your posts.
    Thanks,  Priya, Bangalore

    Kalidas Says ….Thursday, April 15, 2010
    I am back but still not in groove. May take a few days more to digest last 3 weeks events.

  34. Respected Sir,
    Dish TV: Equity:101 Cr shares, 50% added after March 11th in the form of right shares. The share price started moving down after very long time from Rs42 to about Rs.36(15% reduction).It appears that it may fall down in commensurate with new shares added. This equity infusion will make this company debt free, interest costs will come down and break even at net profit level expected in the coming quarter result. It is expected many new buyers who bought LCD TV’s might have preferred Dish rather than cable.
    In this context, my question is can I expose 5% of equity funds (max percentage you allowed in each scrip) in Dish TV now? Will you still take Rs-80-Rs90 target for this stock after enhanced equity?
    Regards,
    V.S.Kumar, Jorhat

    Kalidas Says ….Thursday, April 15, 2010
    Yes. My target is much higher than 80/90. Expect 180 in 3 years time, allowing split or bonuses in the meantime.

  35. Give your Investment view of  1-2 yr. time horizon for Fortis Health Ltd.  CMP- 183.

    Rashes.
    Ghatkopar – Mumbai.

    Kalidas Says ….Thursday, April 15, 2010
    Negative

  36. Looks like Kalidasji is busy in India and we can expect him only to respond after he is back in April (mostly after mid-April).
    Lets hope there isn’t any major correction while he is away.
    Regards,
    Atul
    Singapore

    Kalidas Says ….Thursday, April 15, 2010
    I am back and could not see major gains in the stocks – hardly 5% to 10% here and there. Ruchi Infra, Petronet and Abhishek doing well.

  37. Abhiskeh Ind

    Dear Sir,

    At the current prices, what portion(%) of the total indian equity portfolio should go towards Abhishek Industries ?

    Also, if you could also comment on my portfolio allocation. I am 32 years. And I am allocating my total networth as follows: 25% into Indian Equity, 10% into International Equity (mostly in Gulf equity markets which are extremely undervalued nowadays), 15% into Gold, 10% into Silver, 40% into Fixed Deposit schemes like TDs, PO Box etc. No investments in real estate/property. I don’t own a property.

    Your comments would be highly appreciated.

    regards
    Mehr,
    Delhi, India, 15 march 2010

    Kalidas Says ….Thursday, April 15, 2010
    Abhishek Industries – Not over 10% of 25% earmarked for Indian equities.

    Raise investment in Silver by selling some gold. It looks like Silver will rise faster than gold.

    Earmark some funds for investment into properties if it is meant for self use. Otherwise, wait

  38. Whatever the government has divested in the past the value of it has only gone up. So can we assume in the long run the value of NMDC will rise?

    princeofindia
    Abu Dhabi

    Kalidas Says ….Thursday, April 15, 2010
    You may take a chance. I do not play “divestment game” – it is for short term traders and rumor driven buyers.

  39. http://www.businessinsider.com/gold-threatened-by-etf-overhang-2010-3

    Sir, Your comments please
    NSri
    Pune,India

    Kalidas Says ….Thursday, April 15, 2010
    They are lobbyists against gold. Ignore them. My view remain unchanged. The gold is back on rise again, slowly but surely. Once it exceeds 1185 and then 1235, it will begin to show speedier gains.

  40. Kalidasji,

    I had bought 340 Ruchi Infrastructure on 18 Feb 2010 @ 58.(As per one of your comments)
    Current price is 48.2(down 17.5 %) .Should i buy this more or exit from this ?

    Thanks
    anoop
    chennai,india

    Kalidas Says ….Thursday, April 15, 2010
    Sorry, I could not reply you in time. Good stocks are always bought upto certain level. When the stock tanked to 48, it was obviously buy opportunity. I think the stock has retraced to 58 again.

  41. Kalidasji,

    Here’s a short para copied from the net.

    It should be music to the ears of US authorities that China is now claiming to be long on US Treasuries. Being the biggest buyer of US papers, China had been showing concerns over the diminishing value of US Treasuries after the subprime crisis and dollar devaluation. However, the dragon economy now seems to be finding more value in the greenback. It is estimated that China’s reserves are about US$ 2.4 trillion. China believes that it would be impossible for gold to become a major investment channel for China’s foreign exchange reserves. The economy that currently holds about 1,000 ounces of gold would not have an exposure above US$ 30 bn even if it doubles its exposure to the precious metal

    Your comments please.

    Regards,

    Hem, Mumbai

    Kalidas Says ….Thursday, April 15, 2010
    China is smarter than other countries. It is acquiring Mining and Metal assets in commodity countries like Australia, South Africa, Africa and Canada. It has seen the advantage in buying those assets in terms of capital gains + currency gains.

    Investing in gold upto 1000 tons is not enough. Even if China buys additional 9000 tons of gold, it will spend just $ 335 billions, almost 10% of present reserve. Gold is not viable option for China. Coal, copper, Aluminum and steel is the best investment option for China

  42. Dear Sir,

    Please update your latest stock observatory. Thanks.
    Regards.
    Anand.
    Chennai.
    India

    Kalidas Says ….Thursday, April 15, 2010
    I will from next week. I am still trying to recapitulate last few days events. As soon as it is over, I will restart posting in stock observatory

  43. DISH TV
    Dish TV appears to be in a down trend, about 7.5% fall in the last 5 days. SHould we get out of this counter now and get back in once the trend reverses or should we treat this fall as an oppurtunity and accumulate more. I’m holding 250 shares at 37.95 bought about a month back. Please advise.
    S Muthu Raman, Chennai, India
    13 March, 2010

    Kalidas Says ….Thursday, April 15, 2010
    These are probably last bearish days for Dish TV. If my judgment holds well, the company will be in black officially by latest June quarter. I would not take a chance to sell it with a view to buying back at later stage.

  44. Kalidasji,

    About a year back, you opined that ‘gold would rise in a short time; at higher prices, Indians would sell the gold and invest in real estate. So, property price would rise’. 
     
    Since then the gold prices have risen by about 10-15%, stock market by over 50%. Real estate also is looking upward. In Navi Mumbai, the prices have risen by at least 10%. Number of transactions has increased considerably.
     
    In the meantime, I read a couple of reports saying ‘world over asset prices have risen and the bubble is ready to explode’.
     
    My question is about prospects for investment in real estate, more specifically in Navi Mumbai.

    What is your opinion about valuations in Navi Mumbai?

    Do you see any possibilities of prices rising @10% in next 4-5 years?

    In case the global scenario turns bad in next 5 years, do you think, Indian property markets can escape without much damage?

    What is your opinion about maximizing real estate investment using 80% bank finance until I exhaust my limit to pay installments, considering my investment horizon is 5-10 years?

    Abhimanyu
    Mumbai

    Kalidas Says…17Mar2010
    We can not compare the bubble in asset prices abroad and India where the physical demand is driving up the prices and derivative operations are much smaller. Overseas, it is property related derivatives caused the crisis.

    Navi Mumbai is the best positioned. However, the real momentum in Navi Mumbai will take at least 3 years to develop. The rise of 10% is too modest. expect 50% rise in about 3 years time, after which the prices could be rising faster.

    Nevertheless, the financial crisis abroad is so acute that any collapse will bring down the Indian stock market and that may affect the property market as well. It is good to buy some property in Navi Mumbai but much depends on location. Do not expect the prices to rise fast because there is umpteen supply of land there. Suburban property will still rise inspite of being unaffordable. In market crash, the suburban property will fall faster than in Navi Mumbai.

    Wait patiently till the crash arrives in stock market. if you do not have patience, you are not entitled to invest every last rupee.

  45. Great mind! Great work!!

    Warm greetings and regards.

    Balasubramanian

  46. Dear Anil Ji,

    My brother is working in Microsoft Corp. USA and has received Microsoft shares in ESOP. The details are provided below.

    He doesn’t hold any other equity apart from these and has an outstanding loan of 20 lacs for a flat in pune.

    Date Acquired

    Quantity

    Cost Basis per Share

    Closing Mkt
    Value

    Cost Basis

    Unrealized Gain/Loss

    Unrealized Gain/Loss %

    Holding Period

    Transfer Availability Date

    6/30/2008

    82.613

    $24.76

    $2,393.30

    $2,045.50

    $347.80

    17.00%

    Long

    4/1/2010

    9/30/2008

    112.8

    $24.02

    $3,267.82

    $2,709.46

    $558.36

    20.61%

    Long

    7/1/2010

    12/31/2008

    120.394

    $17.50

    $3,487.81

    $2,106.90

    $1,380.91

    65.54%

    Long

    10/1/2010

    3/31/2009

    127.459

    $16.53

    $3,692.49

    $2,106.90

    $1,585.59

    75.26%

    Short

    1/2/2011

    6/30/2009

    102.487

    $21.39

    $2,969.05

    $2,192.20

    $776.85

    35.44%

    Short

    4/1/2011

    9/30/2009

    130.336

    $23.15

    $3,775.83

    $3,017.28

    $758.55

    25.14%

    Short

    7/1/2011

    12/31/2009

    79.113

    $27.43

    $2,291.90

    $2,170.07

    $121.83

    5.61%

    Short

    10/1/2011

    Can you please guide as to should he sell some or all of his holdings and invest in other stocks / other instruments or do part payment of his outstanding loan as he is evaluating options of moving to India in September. Also, what should he do in case he doesn’t move to India in September 2010 and continues with Microsoft Corp.

    There are some tax implications of selling short term holdings while there are none for long term holdings.

    regards,
    Anurag Agarwal
    Noida, India

    Kalidas Says ….Thursday, April 15, 2010
    Microsoft earnings of late are more on positive track. Nevertheless, Apple is posing significant threat to Windows. Microsoft growth rate at 18% is still acceptable with little debt.

    However, there are simply too many shares (over 8.7 billions shares) in the market place which limits its rise. Unless there is reverse split, the chances of stock making decent gains is relatively less. Nevertheless, the stock is out of low trading range into positive track.

    I think India offers more potential than Microsoft. Let him sell 60% of his Microsoft and use that money to buy some Oil, pharma and select infotech stocks. His chances of decent capital gains with currency gains may serve as “double engine”

  47. Even after ruining the whole banking system the whole thing is still run by the same thugs, man these so called leaders of the free world stink.
    http://www.nytimes.com/2010/03/12/business/12lehman.html?pagewanted=1&hp
    Martin
    Goa India

    Kalidas Says ….Thursday, April 15, 2010
    Very true. Almost all are doing postmortem of what happened, when happened, why happened etc. It looks like we are still in the morgue.

  48. In the entertainment industry, what is you opinion  on Zee TV & PVR. I have already have invested in Dish TV & TV Today.which TV Today I think is on ADAG Radar for aquisition at some point.
     
    Vivek
    New Delhi
    11 March 10.

    Kalidas Says ….Thursday, April 15, 2010
    The entire entertainment industry is on strong upswing. In fact, entertainment industry could become one of the main driving force after Infotech in services sector.

    Zee Entertainment (if that is what you meant) trading at Rs 294 is extremely expensive stock by my standard, trading at 32 times P/E with less impressive growth. In fact, it has demerged number of subsidiaries into separate listed companies. It has no longer assets that can be sold or realized through separate IPO. It has to rely on its own earnings.

    I have always maintained that when there is a choice between Holding company and individual listed subsidiary, better chose the Subsidiary. In present case, Zee has only take over appeal which may not materialize due to ongoing liquidity crisis.

    I would settle for Dish TV instead of Zee.

    TV Today used to be ADAG’s acquisition target. I doubt whether ADAG has spare cash to take over TV Today. I would evaluate TV Today on its own rather than as take over target by ADAG or some other company. Of late, its growth has picked up. It is reasonably priced. But Dish TV can make more money than TV Today

  49. Seeing Red in deficits Saumitra Chaudhuri In ET.
    http://economictimes.indiatimes.com/Comments-Analysis/No-room-for-fiscal-adventurism/articleshow/5661190.cms
    Martin
    Goa India

    Kalidas Says ….Thursday, April 15, 2010
    Agreed. Almost all governments are deep in red. They spent hundreds of billions to bail out the banks, brokers and insurers. Almost all money spent on bail out are gone. The US, UK and European governments alone spent and lost over $ 3 trillions on most conservative basis. To earn the sum of $ 3 trillions, the tax payers have to have taxable income 3 x 3 trillions = $ 9 trillions. Presuming the profit margin of 10%, the businesses have to have gross revenue 10 x $ 9 trillions = $ 99 trillions. That is nearly 9 times the US economy!

    No one knows clearly how such massive deficits in government balance sheets will be addressed. The logic will take back seat for number of years. Let us see how things would be played out.

  50. Ashtavinayak

    Dear Sir,

    I am just putting some off the cuff comments here, further on Apurva posts below:

    Sir, unlike other entertainment co. like dish tv, etc, this company seems to be run by “lalas”. The chairman Dhilin Mehta is a 28 yrs old boy who seems to be there only because of his family than any merit. The first page of the website says

    “The Indian film entertainment industry is projected to grow from the present size of Rs 8,400 crore to Rs 17,500 crore by 2011″

    The present size mentioned is as of 2006.

    Now what is this. Unprofessionalism. A publicly listed company cannot even mantain its website properly. It is publishing data (which is more of copy and paste) and the data is not even current but 4 years old. And then on top of it, this whole lack of clarity in the split and bonus process.

    Sir, I trust your judgement and your years of experience. However, prima facie I find the management team of this company very basic and far away from being dynamic and professional.

    regards
    Mehr
    Delhi, India

  51.  
    Shree Ashtavinayak Cine Vision Limited 
     
    Dear Kalidas Sir,
     
    I have purchased 1000 shares @ 22.4 on 10th Feb 2010 of this company and would add much more at lower price.
     
    What I understood from the ‘corporate announcements’ section of the company on NSE website, the Total Equity shares of the company has been increased from 40Cr to 100 Cr as approved at meeting held on 18th Jan 2010.
     
    Till March 2009 equity shares were ~ 1 Cr (of face value Rs 10. – pre split)
     
    So the recent increase in equity share is not from only split (1:10) and from bonus (1:4) but also from increase in authorized share capital.
     
    Company announced bonus of 1:4 which increased equity shares from ~10Cr (pre split) to ~40 Cr (announced on 28th Dec 2009). This was supposed to be approved by board on meeting held on 18th Jan 2010. But before that is approved on 31st Dec 2010 company came up with announcement of increase in authorized share capital from 40Cr to 100 Cr and same was approved on 18th Jan 2010.
     
    Hence if we keep the recent high on 18th Jan 2010 of ~93.4 (post split 1:10) in mind fair value seems to be to be ~9 or less – if we consider all business opportunity / environment remained constant in these two months.
     
    Sir, please clarify whether my understanding is correct?
     
    As you suggested I went through the website and also through annual reports and got convinced about the growth potential (with high risk) and would add at still lower price, but concerned about such behavior of promoters.
     
    The key promoters (The managing director and Chairman Dhilin Mehta and Dahlia Traders Pvt.) have sold shares (marginal only – 0.12%) on 16th feb, and 2nd march and bought back some on 4th March (as per corporate announcement on NSE).
    So they seem to be doing trading of share of their own company.
     
    Apurva,
    Mumbai, India

  52. Dear Aniljee
    I came across this quote on Tweeter, thought of re-producing here.
    “The differences between Goldman Sachs & the mafia: GS has a better legal-regulatory expertise; but the mafia understands public opinion.”
    Regards
    Aditya
    Mumbai-India

    Kalidas Says…17Mar2010
    Let us not get too far to the extreme. Both are incomparable.

  53. Dear Sir,

    Any thought over dredging corp of India. Will it ever touch life time high of 1290..

    Regards,
    Onkar
    Delhi

    Kalidas Says…17Mar2010
    I am yet to study the stock. I can not express opinion loosely,.

  54. Anilji,

    Is it worth applying for NMDC FPO which is priced at Rs.300 – Rs.350 through book building.

    Regards,
    Awadhesh
    Mumbai,India, 10March’2010

    Kalidas Says…17Mar2010
    For the time being, I am negative on metals, so the mineral stocks are not on my preferred list. They are on my SALE list

  55. Dear Sir,

    As you have mentioned in one of your answers , its better to have kept shares in Banking Sector and in another answer you are saying Indian pharma sector is about to rise.
    Which stocks you suggest to invest for the above 2 sectors for which you see will rise in next 6 mths or so.

    Regds
    Sameer

    Kalidas Says…17Mar2010
    Suggesting one sector is not at the expense of other sectors. There are going to be good performing sector. Banking sector is usually last sector to perform. All economic activities are translated into money later. Therefore, contributing sector always precede the banking sectors. To be specific, pharma sector will outperform banking sector in short term

  56. Dear Sir,
    Happy to see (missed you)and read your comments ! sir would it be possible  or are you planning to start an educational series on stock picking based on your immense knowledge and years of experience . Would greatly benefit small investors like me and many to learn the correct way   and from the RIGHT  guru ..
    Thanks & regards
    Sajith,chennai,Mar9th

    Kalidas Says…17Mar2010
    I would consider starting such series in future. It will take at least 2 months to structure the arrangement since I am out of town. I will make anouncement later.

  57. Contrarian view. Could Geithner Have got it right?
    http://www.newyorker.com/reporting/2010/03/15/100315fa_fact_cassidy?currentPage=all#ixzz0haHEOfV7
    Martin
    Goa India

    Kalidas Says ….Tuesday, March 09, 2010
    Interesting to read, difficult to follow. The article is obviously written by some lobbyists. How do I believe that the US administration spent only $130 billions when the deficits swelled by over $ 1.7 trillions?Why was it necessary for President Bush to announce over $ 700 billons of rescue package followed by Pres. Obama’s package of even larger amount under TARP and Stimulus Plan? Where those money have gone?

    Paulson/Bernanke arranged the guarantee of Citigroup by oiver $ 300 billions which has or will become a reality. This bank alone has cost the treasury over $ 450 billions – and they are talking about just $ 130 billions for entire bankling industry?
     

  58. China seems to be moving towards a floating Yuan, or at least removing its dollar peg. This signals further strengthening  of the rupee as well. I read this as a poiner towards selling IT/Select Phrma & getting into OMCs. What else could be bought with this development coming true.
    Your input on my judgement would be greatly appreciated.
     
    Vivek
    08 March 2010
    New Delhi.

    Kalidas Says ….Tuesday, March 09, 2010
    This is played up by the Western media. I do not see any admission by Chinese Authority to move Chinese Yuan towards free floating. It will not happen for another 5 years at least. To have free floating, you have to have free banking system which the China does not have. When the Chinese do not allow its citizens to protest, where is the question of allowing its currency to have free float?

    Whether Rupee is at Rs 47 or Rs 35, IT Sector and Pharma sector will perform better and better. There is no real alternative for Indian IT companies – they are just superb and irreplaceable. For pharma sector, the global situation is turning in its favor. Hundreds of drugs will lost their patents in USA in next 12 to 18 months, so Indian drug manufacturers will be in position to sell generic drug with gusto. The drug producing centers like Hyderabad will have rosy future and they will be much talked about the way the IT sector is being talked about now. Further, the rise in Health Care cost in USA will favor large scale imports of cheaper generic drugs from India.

    Currency strength or weakness is one of the least important factor for exports, although currency strength is always singled out as an excuse by inefficient exporters. If currency was the only factor to encourage the exports, why not government make $ to rupee to 100, 200, 1000 or 10,000? Let the people pay Rs 300 per liter for petrol in that case.

  59. You have been predicting a severe crash for sometime. However the D day has still not arrived. Is it realistic to expect the crash over the next 6 months? Would you then still advise to sell as much as possible and move to cash?

    Princeofindia
    Abu Dhabi

    Kalidas Says ….Tuesday, March 09, 2010
    Death, Accidents, Stock Market crash and New Customer can arrive at any time without notice. We are at the moment in the hands of various governments printing the money out like there is no other day. If excessive printing had been the real alternative, no government will need to tax its citizens – it can finance needs from its printing press. You can fool the thousands for a few days, a few months, not forever.

    The present crisis would not have arisen if what is being followed was the answer. The money has to have some cost – right now it is almost free. The governments world over are in serious debt, and even slight rise in interest cost will make debt servicing unaffordable.

    A patient investor always waits. This is why he is known as Investor. Others are not. The real investor makes almost 20% per year on simple average basis over a period of 10 years. I predicted about the dollar crisis 10 years ago, and it did develop in 2007. I advised in my research “Bankrupt Dollar” in 1999 to buy gold when it was nearly $280 – today it is $1122 or rise of $942 or 336% in 10 years or 33.6% per year annualized.

    You are in trading market where all fundamentals, realities and seriousness are ignored. Yes, you can have partial exposure for which I have already mentioned increasing exposure from cash to equity by extra 15% (total 25%) with intent to sell in rally and buying back the same stock in correction. If you really want to invest on long term basis, and you are between the age of 40 and 50, then wait. At the moment, the possibility of immediate crash is not imminent, but it is still on horizon. It is like you see the rain coming at far distance, but the spot place is still sunny.

  60. Dear Kalidas Ji,

    I have purchased a scrip called RICOH INDIA @ Rs.27(2000 shares)recently.  It’s a Fortune 500 Company and in the last couple of years has done restructuring and profitable for the last 4 years. EPS for 2009-10 is expected to be Rs.4. Company is debt free and RICOH Japan is holding 73.6%. Would you recommend holding it, accumulating it or disposing it of since I have recently acquired it?

    Rajesh Agrawal
    Singapore
    6th March 2010

    Kalidas Says ….Tuesday, March 09, 2010
    I have not investigated. But what you say is true, then it is worth investing. The reason the stock is not widely followed is due to the fact that it is owned almost 74% by Ricoh Japan. Large funds prefer to invest in companies having larger free float, generally 40% to 60% whereas the present case, it is less than 26%.

    The company may be privatized if share value do not rise in tandem with its earnings. Buy it and put it away.

  61. Dear Anil,
    I am happy to know all is well with you. God will help those who help others!!! May God bless you and your family with good health and wealth.
    I am now  convinced and  that IFCI will go past  61 shortly. I will be the first one to check it out as there may not be much upside beyond  Rs.100. Please advise me where to invest my proceeds for better returns than the loss I suffered in IFCI
    so far. What level I should exit IFCI and please give me two stocks which  can give me greater returns.
    Regards
    Naidu
    Bangalore , India

    Kalidas Says ….Tuesday, March 09, 2010
    Dish TV and UCO Bank

  62. Hello,
    While answering to one of the borderer you said GOI will not let rupee to appreciate against USD unless until China do so what is reason? I am just curious.

    I learned lot from your blog some different views about investing of which I never thought.

    Thanks,
    Tushar USA.

    Kalidas Says ….Tuesday, March 09, 2010
    China is the biggest competitor of India. If it devalues its currency, GOI will also let Indian Rupee to weaken to maintain the currency advantage. If China revalues its currency, GOI will either maintain rupee level or allow it to appreciate in tandem with the Chinese currency.

  63. Dear Kalidas,
    Am a regular reader of this space from jan 2010 and this is the first time am posting a query. Can you please tell me the future outlook of the bank sector (indian)?  In past one week, the bank index moved from 8500 to 9092 (almost 7%)
    Thanks in advance
    regards
    Manjunath , Bangalore, India, 6-MAr-2010

    Kalidas Says ….Tuesday, March 09, 2010
    Indian Banks are in strongest position in the world. If India is to grow at the clip of 7% to 9%, the biggest beneficiary will be the banks only. Even at today’s value, Banking sector is still the cheapest sector in the market place. The reason it is not moving up at frantic pace, is that the financial sector world over is commanding little respect, with financial crisis still hanging over the whole world.

    It is better to place the money into the shares of Indian Banks instead of keeping the money in bank deposits.

  64. Hello Kalidasji,
    I would like to know the relevance and effects of using FCCB, Debt restructuring, Fixed Price Offer(FPO) used by companies which is sometimes negative and sometimes positive for them, which is evident from the price movement in the stock.
    Can you throw some light on these things. Thanks.

    Dhaval
    Mumbai
    05-03-2010

     Kalidas Says ….Tuesday, March 09, 2010
    I can not reply here because it requires lot of space. I am planning to write an article on Convertible Bonds soon, which will cover all aspects. Wait until then.

  65. Sir,

    Can you please review on Essar Oil (CMP 135) and budjet impact on it. You said that you will post answer after reading budget in my last query (feb).

    Regards,
    Krishna
    Hyderabad

    Kalidas Says ….Tuesday, March 09, 2010
    I have not had time to evaluate the budget. Further, Essar Oil is not a PSU. The recent increase in petrol pries should benefit the refiners at least.

  66. Abhishek Industries

    Dear Sir,
     A new notification has come on BSE on 3rd March 2010, link as follows: http://www.moneycontrol.com/stocks/stock_market/corp_notices_details.php?autono=313744

    The auditors have commented on a Open put derivative which the company is engaged in. And a possible loss of Rs 135 Lacs as of 31 dec 2010, which has not been accounted for in the 9 month/quarterly results.

    I am unable to understand why is a textile company taking up Open Put options in the market, for what ? And do you see this information as revealing and having a potential setback on results in the coming quarters ?

    Pls advice
    Thanks
    Mehr
    Delhi, India, 4 March 2010

    Kalidas Say……17Mar2010
    The Auditors have disclosed 135,41 lakhs as potential loss. It is Rs 135.41 lakhs or Rs 13541 lakhs, it is not clear. It is regrettable that even Auditors like Delloit Haskins are irresponsible to disclose the numbers carelessly. It could Rs Rs 1.35 crores or huge Rs 135.41 crores – which is right one? They should be fined at least Rs 10 crores for misguiding the investors with unclear and inaccurate information. If they are not sure of numbers why not they keep their mouth and pens shut?

    Abhishek is an exporter. It always has some position in Forex market. However, forward selling of exchange at contracted price does not entail into losses because the sales are reported using the forward cover.

    Under the circumstances, I am not sure whether the losses were due to merchant transaction or some speculative transaction in dabbling into Forex market. Since the company entered into highly complex structured derivative contracts which caused the financial crisis, I would view at least now with caution. We do not know what the transaction is about. The Company management is silent, so also the Auditors. For the time being, I will not be as bullish as before on this company. The core business is fine, but the non core business is extremely damaging.

    Losing Rs 1.35 crores is not much for such large revenue based company. However, if the loss is Rs 135 crores, I would sell the stock and get out. I have to verify the numbers from other press releases.

    In the meantime, reduce the exposure to this counter by 50% at least until we are sure of the numbers

  67. Shri Ashtavinayak

    Dear Sir,
    The scrip had a record volume today of 20 Mn plus and was up 1.99%. CMP is 12.80.
    My average price on the scrip is Rs 16.50 with 2000 shares. I am planning to average it now with 4000 shares. Pls advice if the ratio and price seems ok ? Thanks.

    regards
    Mehr, Delhi, India, 4 Mar 2010

    Kalidas Says ….Tuesday, March 09, 2010
    The stock has not stabilized yet. Buy only 2000 below Rs 12 or so. 4000 is too much until we know the March numbers. Do not count on average cost. If you have bought 2000 at 12, and the stock goes to Rs 14 to 14.50, sell the second lot. Do not buy back below Rs 12 again because lower prices again may denote downward trend. We have to catch the trend not the price.

  68. Dear Kalidas sir, I need your opinion about Avon Corporation currently trading around Rs 7/- in BSE. I am holding 10000 shares bought at Rs8/-. Is it worth accumulating more at these levels.
    Thanks and regards
    Ravi, Chenna, India
     
    Kalidas Says ….Tuesday, March 09, 2010
    Cost difference is not much. On the contrary, reduce the position to 5000 or so if the stock chalks the gain. You invest more in large companies, not in smaller companies.

  69. Dear Sir ,
    Glad to know about your Pune visit , will try and take an appointment in via email communication.
    1 . RIL will start producing gas from  KG basin and same shall be started showing in their result . Published number say that it will be 30 mmscmd for FY10 . With this kind of  new revenue should one consider RIL as investment option in Gas sector ?
    2. US is succeeding in its currency WAR like you predicted . However the pace of such break down/bail out news are playing at slower pace and gives so much time to US(D) to be out of  trouble and find more ways to remain there . This also gives bounce to USD as well as stock markets . With that should one consider any modifications in their investments strategy ?
    3. Info : Serials made by balaji telefilms are back on TRP charts .
    sachin , pune , India
    March 03 ,2010 .

    Kalidas Says…17Mar 2010
    1. RIL is fully priced now. The potential of Gas production is already reflected in high P/E at current prices. Unless there are upward earning surprises, it looks to me that the stock is fully priced. A negative is its potential acquisition of US company which will negatively impact the earning of RIL. Yes, Gas production is one of most positive effect on RIL stock but it is already reflected.

    2. US may show its success for the time being. However, none of the actions of the US administration is on right direction. It should have used the borrowed time for advantage, but it has not. It will fail.

    I am Pune now, leaving tomorrow on 18/3/. I may not be able to meet you in person this time.

  70. Dear Kalidas Sir,
    Please let us know your views on investment in Jaiprakash Associates Ltd (CMP:145.20), I have just been following on this stock and seen lot of volatility , but have not invested any time. Does this stock show potential for long term (2-3 years) gains.
    Regards,
    Atharva
    London , UK

  71. Which Currency is Best
    (posted in Feb series by mistake earlier)

    Dear Sir,
    Most of my investments is in INR and USD. I am planning to convert some of my USD holding for buying Silver ETFs. Which currency in general and here in specific would you advice as the holding currency (besides INR)? Would Swiss Franc be a good holding currency ? Thank you ,
    regards
    Mehr
    Delhi, India 3rd March 2010

    Kalidas Says ….Tuesday, March 09, 2010
    already replied earlier. Visit your original question again.

  72. Kalidas ji,
    We all are happy that you are back again.
    It may be a repeat question but SHREE ASHTAVINAYAK is hitting continuous lower circuits and it is now around 12. I am adding 350 everyday since I don’t know when it will start moving up.
    In various message boards including moneycontrol, rediff people have started spreading panic that the promoters are cheating with split and bonus and it may never go up.
    I had a similar experience with another company by name TELEDATA and I have lost heavily previously. I invested around 50,000 rupees in TELEDATA and now it is worth only 2500.
    I would like to know whether you have changed your opinion after the continuous lower circuits or still see some trading value in this share over the short or medium term.
     
    Thanks,
    KeeYes
    Tokyo
    Japan

    Kalidas Says ….Tuesday, March 09, 2010
    No, I have not changed the opinion. However, please note that we are not detective. If the company can manipulate their balance sheets, then we may not know. However, in present case, the chances of fraud are least. Yes, the promoters have been splitting the shares and issue bonuses to boost the share price. However, if you visit their website and see the movies they handled, it can be said that they really have good business. Since they anticipate good quarters from March onwards, it looks as if they split and bonus the shares to capitalize on rise in share value.

    The stock has come down to my original target level to Rs 12. I had originally bought 1500 shares @ 22 or about. Sold 750 when the stock was at Rs 18.35 or about. I bought back 2250 shares at 12.60. I will not buy more until I see their March performance, or for any reasons, it trades below Rs 10 when I may add another 3000 shares.

    Until such time, the shares have stabilized, continue to trade. That is, if you have picked up the stock at lower level and the stock goes higher in bounce after fall, just sell it. for instance, I bought2250 shares at 12.60, it it goes to Rs 16 or about, I would sell it with intent to buy back even at lower than Rs 12.60 level.

    I have picked this stock based on growth for the industry and the company itself. Visit its website to know more about this company.
     
     

  73. Hello Kalidas ji,
    Reposting from feb to March now due to some required information missing.Sorry!
    I heard from a friend about this website and impressed to read few articles.
    Please advise for following stocks:
    Dish TV(bought in year 2007/2008)- 5500@Rs60(CMP – Rs39.70)
    Vishal Retail(bought in year 2008/2008) – 6700@Rs86(CMP-Rs64)
    educomp(bought in year 2008/2008) – 400@Rs745(CMP-Rs694)
    Indiabulls(bought in year 2008/2008) – 2000@Rs220(CMP-Rs115)
    Asian Electronics(bought in year 2008/2009) – 4500@Rs57(CMP-Rs57)
    Thanks a lot,
    Veekay
    New York,USA
    3rd March,2010

    Kalidas Says ….Tuesday, March 09, 2010
    I have not followed at least 3 out of 4 stocks. I will look at them tonight and let you know tomorrow right under this reply.

  74. Dear Anil,

    Do you foresee possible market crash in near future considering the global market conditions or it is deferred for some time as the Indian markets are on the run up post budget? I’m asking as I am still sitting with approx. 80% investible cash.

    regards,
    Anurag
    Noida, India

    Kalidas Says ….Tuesday, March 09, 2010
    At the moment, the situation is uncertain, not grim. I have already advised to increase exposure to Indian equity by 15% 2 days before budget.

    Be a stock specific rather than market specific for the time being. Do not raise equity investment beyond 30% at the most. Keep more money on hand – until such time earn interest.

  75. Dear Kalidas,
    I am a silent admirer of you and your wisdom, I have a specific question to you regarding moving a substantial sum of money to India.
    I am in Saudi Arabia and have accumulated 200,000 SAR.
    SAR (Saudi Riyal) is pegged against UD with 1USD = 3.75 SAR.
    Given the present scenario of USD, please suggest how & when  to repatriate my money back to India (staggered or lump sum or wait for some time to get exchange rate benefit)
    regards
    Saif
    Jeddah
    Saudi Arabia
    03-Mar-2010

    Kalidas Says ….Tuesday, March 09, 2010
    I have not followed Saudi Riyal because it is not that actively traded. Oil prices are usually quoted in dollar and euro.

    Therefore, when SAR is pegged to USD, better use the strength of USD to remit to India. Use any strength in dollar, and at any time, you get above Rs 47, it will be a good remittance deal. Phase out the remittance in 5 instalments.
     
     
     
     
     
     

  76. Dear Mr.Anil ,
    Although you were predicting  a  crisis or crash in the world markets including india (in february) , the markets  on the contrary has reacted otherwise with continued  upside .  Would you say you underestimated the power house USA in  keeping things quiet .. your  views in the current scenario.
    Thanks & rgds
    Padmanand
    Chennai

    Kalidas Says ….Tuesday, March 09, 2010
    You may say so. No other views on manipulated markets by US Authorities on dollar front.

  77. Dear Sir,

    After your advice i have bought Dish TV,AbhishekhInd ,Petronet. Within 6 mths how much do you expect to appreciate.

    Regds
    Sameer
    Pune

    Kalidas Says ….Tuesday, March 09, 2010
    You will get better return in the order of Dish TV, Petronet and Abhishek Industries. I can not give you 6 months target because I do not take trading position with these stocks. If you want to take trading position, better focus on Index stocks.

  78. Sir,
    How should one look at IOC, HPCL, BPCL post budget? Should one exit and wait to enter at lower levels?
    Thanks,
    Pawan,
    Delhi, India

    Kalidas Says ….Wednesday, March 03, 2010
    Repeat question. Replied already.

  79. Dear Sir,

    Today INR to USD is RS 45.90.
    What is your take will INR further appreciate agaisnt dollar .
    Regds
    Sameer
    Pune

    Kalidas Says ….Wednesday, March 03, 2010
    Replied already

  80. “British household debt is now 170 percent of overall annual income, compared with 130 percent in the United States. In an echo of the United States’ rush into subprime mortgages with low teaser rates, millions of homeowners in Britain have piled into variable-rate mortgages that are linked to the rock-bottom base rate”.
    Source
    http://www.nytimes.com/2010/03/03/business/global/03pound.html?hpw
    Martin
    Goa India

    Kalidas Says ….Wednesday, March 03, 2010
    The very first mistake the investors make is comparing wrongly in % and ignoring absolute. In the market place, the investors ask question of how much a person has debt (absolute numbers) not in % of his GDP. When you spend too much at home or outside, does your parent or wife ask you how much % is spent or ask in absolute numbers?

    United States is trying to deflect its massive deflation by comparing the debt to % of GDP. What is $ 25 billions debts for Greece compared to $ 14,300 billions of debt of United States?

  81. Dear Kalidasji,

    Praying,                  ALL IS WELL !!
    Dongre, Mumbai, India, Mar 4/2010

    Kalidas Says ….Wednesday, March 03, 2010
    yes, it is.

  82. Gold purchase
    Dear Sir
    In last couple of months I have saved around $5000 and thinking of investing in Gold.  I am a regular reader of your blog and immensely helped by your insight and also to an extent by other contributors (By way of sharing links).  I feel time is nearing now for explosion of gold price and we may not get one more chance if we don’t act now.  Though silver may do better, but I am not confident to invest, as in difficult times,  gold alone will have value.  Your guidance will be of immense help to me in making above decision.  To be honest I have lost faith in stock market.  Enclosed is the link, where I came across, which gives similar views as yours.
    http://www.shadowstats.com/article/hyperinflation-2010
    Regards
    Jay
    New Jersey
    USA

    Kalidas Says ….Tuesday, March 09, 2010
    Of late, the gold is moving in trading range with upward bias. To me, there is something brewing under the table which may blow up within a couple of months, I would not be sure of timing, because I was away from my desk due to personal preoccupation.

    The new range of gold is 1085 to 1135. Try to buy around 1085 t0 1095 level because we are not talking about very steep correction, just normal one. In present market, the US dollar is pushed up often, which may cause some correction in the gold prices.

    This time around, if the gold exceeds $ 1135 and remains above that level for 3 days, it may have small resistance at 1185 before proceeding to $1235. Once it exceeds $1235, it may rise very fast to $1400 level soon.

  83. Gold and Silver

    Dear Sir,

    I might be repeating a question asked before. However, wanted your advice on : what percentage of one’s networth should be invested in Gold ?

    Also, how can I take exposure to Silver in a non-physical form ? Buying physical silver is volumnious and then silver corrodes.
     Thank you

    regards
    Mehr, Delhi , India, 3 March 2010

    Kalidas Says ….Wednesday, March 03, 2010
    15% at current prices. For Silver, try ETF. Here is a good site on ETF where you can find specific ETF for relative industry. The link is http://etf.stock-encyclopedia.com/

  84. Dear Kalidasji..
     
    Trust ALL IZZ WELL
     
    Regards,
    Sreeram, London UK
    1717hrs 02-Mar-2010

    Kalidas Says ….Wednesday, March 03, 2010
    Yes. ALL IZ WELL

  85. If IFCI gets banking license can it ever touch lifetime high of Rs 120 plus  in the next couple of years post license?
    Princeofindia
    Abu Dhabi

    Kalidas Says ….Wednesday, March 03, 2010
    Not easily but it will have steady course upwards. There are too many old investors, including nationalized banks who converted Rs 1500 crores of Zero Coupon bonds into IFCI stocks at about Rs 108. Unless these investors get out of the market, there is little chance of IFCI gettin into Rs 120 league – there will be simply too many sellers along the way.

    Trust other banks who already have banking license and better earnings. IFCI will improve but steadily – it won’t fly – its wings have been cut by GOI, FM and its lousy CEO Mr. Rai who should have been dismissed long before.

  86. Hello Sir,
    IOC, BPCL etc have been moving down after the budget. I bought IOC at 304 while you advised a buy at 270. Would you recommend a sell now and buy at 270?
    Thanks,
    Pawan,
    Delhi, India

    Kalidas Says ….Wednesday, March 03, 2010
    You once said that you believed in Long Term investment, and in that case, why do you see the prices everyday?
    Stay with it. If these stocks do not give you appreciation by at least 150% in 3 years, kill me.

  87. Hi Kalidas-ji,
    Wish you a happy holi. I just recall your last blessings on me that my habit of regular observations will reward me sooner or later. With immense joy, I wanted to express my love and gratitude to you that I came across some great wealth in my life very recently – it is far from anything related to money and not even within the scope of this column to discuss. But I did not want to miss this opportunity to again come back to you and thank for everything.
    On the market, just a clarification I wanted to seek from you. As you had indicated earlier, this budget has come up with a serious relaxation in the tax structure. In simple calculation, my net salary increased by 15% instantly while another formal increment just knocking the door at the end of 2009-10 financial year. Taking it as part of the whole story, the stock market in India is ready for a leap – if I understood your thought process correctly that time. But time can change anything – so can please assure if the same rule is applicable even now or I need to keep cautious ? In any case I am not going to jump into the market tomorrow itself, and also I am not much bothered on few % change here-n-there. I have enough time in hand to wait for my investment to grow slowly.
    Thanks once again for all your help and wisdom. May God bless you a life brighter than all others.
    Sudipta, Kolkata, India.

    Kalidas Says ….Wednesday, March 03, 2010
    Too general question for me to answer in specific terms. The only thing I can say that “the budget is good” but the Finance Minister lost golden opportunity to go fast track. He belongs to Congress which had old symbol of ” a Pair of Two Bullocks”. He is still in bullock cart age, he proved. He must change the mind and traditonal dress to suits to have new fast track philoophy. He is too slow.

  88. Do you think that IFCI will get a banking license at last.
    Please also give your opinion on
    Reliance Capital
    Aditya Birla Nuovo
    Srei Infra
     
    I ask about these companies from the point of view of them getting a banking license. Will it really make big difference to their stock price, if they do.
    It is interesting to note that Sundaram Finance has decided to stay out of the fray for a license.

    Kalidas Says ….Wednesday, March 03, 2010
    License is a paper asset – no real addition to value. HFCL got many licenses at heaviest prices on record and it went nearly bankrupt. We will evaluate when the license is actually received.

  89. Dear Anilji,
    Wish you a Happy Holi!!
    I do understand with so many other commitments that you may have, how difficult it may be for you to reply to all our queries and comments, however I am so used to reading this, if I do not see any comments of yours on the Confused Mind Series or on the Stock Watch Column, I feel exactly as how we would feel in the monring if we do not get the Newspaper to read. Ofcourse yours is more than the Newspaper we read, as we watch, read and go by your words or valuable advices.
    I was eagerly awaiting for your comments on the Indian Budget presented last week. Where do you think the markets are heading to and how do you see the Rupee going forward. What should be our next step.
    Thanking you once again for all your valuable time and guidance,
    Best regards,
    Ragav
    Chennai
    India

    Kalidas Says ….Wednesday, March 03, 2010
    I understand your point. However, I also have some personal commitments which I was attending. I will write article on Budget and its effects shortly, surely before I proceed to India on 15/3 for 2 weeks (My reply speed will depend on the internet connections are various places, and availability of computers.

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