News Letter 26-09-2014

CNI Publications; Weekly Plattern
Weekly summary
Vol -1, No-I, 26 Sep, 2014, 09 pages
Editorial
There is nothing to react on negative opening of Nifty.
This is part and parcel of the expiry game. Nifty will
close around 8190 on Thursday as per my
calculations. We will see Nifty crossing 8500 in
DIWALI.
The mid cap and small cap rally will continue
unabated. Typical bull run kind case scenario is seen
in many stocks. LML e g has moved up from Rs 5 to
Rs 12 with high volumes on the buzz that TVS may
take over this ailing 2 W co. This happens only in bull
case scenario. This means we are in a defined bull
run though many investors have not made big money.
I suggest stay invested. Roll your positions if you in F
O and just wait and watch for DIWALI.
Nothing to worry even if Nifty is little bit down. Nifty
movement is thanks to roll over. After this Nifty will
again rise. My call is Nifty will close at 8190 in this
expiry. Major action will happen from 26th till 23rd Oct
DIWALI where we should see Nifty at 8500 and all
mid cap and small cap stocks will blast.
Change of the week
26-Sep-14
Rise /Gain
Sensex
26626
464
Nifty
7968
153
FII
DII
22-Sep-14
69.1
31.4
23-Sep-14
(954.3)
325.7
24-Sep-14
(689.0)
(15.2)
25-Sep-14
(416.2)
818.6
26-Sep-14
(1133.6)
1335.3
(3124)
2495.8
Total
Turnover (` Cr)
Hold positions.
When we see 8500 in Oct no one will talk about
EUROPE, IRAN or any other factor. So what is the
point you need to know is that this kind of fall ahead
of expiry is a good opportunity to buy only as market
is in upward direction. This kind of statements from
media could be either their lack of knowledge and
expertise to understand the market or media has
been innocently used to toss up such statements
which makes traders jittery and stop losses gets
triggered
FII
DII
Combined
26-Sep-14
41,428
17,999.6
59,428.5
26-Sep-14
Advances
828
Declines
641
Ratio
1.29
There is no change in my opinion hence I would stick
with my core call that buy.
Cni Research Limited
www.cniglobalbiz.com
1
We will talk much only after we see 8500 where is
market heading. Now for the time being just buy at
every dip. Welding stocks will do extremely well as
MNF is gathering pace. Without welding ENGG is
impossible and there are only 3 key players in
welding.
5 Top Gainers
The panic is unwarranted and created one. It seems
this is again a bigger trap for trapping traders on
wrong foot.
Technically market becomes weaker if it goes below
7900. Therefore an attempt is being made to bring
down Nifty. Already stop losses are triggered in a big
way. Now they want traders to go short.
In my opinion we should not short and wait for
opportunity to buy. So far we have not become very
aggressive in F O stocks. Our long calls stick with
Century IFCI R Com and HDFC Bank. These are
positional calls and we suggest hold as market has to
make U turn.
Stock
26-Sep-14
22-Sep-14
% Gain
2704.0
2500
8.1
35.2
33.6
4.9
GLAXOSMITHKL
5266.7
5056.1
4.1
ITC LTD
371.7
359.4
3.4
HCL TECHNO
1714.5
1670.3
2.6
26-Sep-14
22-Sep-14
SUZLON ENERGY
14.3
20.4
29.9
UNITECH LTD
20.4
25.2
19.2
JAIPRA
27.1
33.6
19.2
JPINFRATEC
20.9
25.7
18.8
ANDHRA BANK
66.8
79.8
16.2
GLAXOSMITH
IFCI LTD
5 Top Losers
Stock
% Loss
Why are we talking about coal cancellation...? How is
it negative...?
Top 5 Picks By CNI 'A' Group
In fact no one could extract or use coal from the coal
mines allotted to them as the coal scam was out in
2010 and since then the same was under CBI
scanner....
Company
BAJAJ AUTO
SBI
I do not whether these companies have given some
money to Govt for allotment of coal mines. But if yes
then they will get that cash back which somehow will
help to reduce debt as well import coal from
Indonesia.
Therefore the issue is sentimental one and no much
importance can be assigned. In fact with fresh
allotment, govt will get money and right players will
get coal which will go long way in resolving coal issue
once for all. Power co's was never favoured by CNI
for that matter. PSU Banks could see some hit as
they must have exposed to loans to power cos in
anticipation of coal availability.
ICICI
COAL INDIA
OIL INDIA
Top 5 Picks By CNI 'B' Group
Company
In short this is all roll pain. We should continue to use
buy on dips strategy.
RASI
CMI
RMCL
GLOBAL OFFSHORE
BUTTERFLY
Cni Research Limited
www.cniglobalbiz.com
2
There is no change in my view. I will go bearish if NIFTY breaks 7480 then I will exit market. Else even if 300
points correction happens I will remain always buyers. The bull market will not end before 2018 come what it
may. In fact we knew this hence even in 2008 post LEHMAN and in 2010 post big crash CNI was always
sounded bullish as these were part of correction of the bull market which never ended after it started at 2003.
Please make your memory fresh. from 2000 to 2003 CNI was only bearish. From 2003 always remained
bullish. From 2018 or whatever the near period you will see CNI first turning bearish.
So save energy, build assets for your worst time to come
Market was in full panic zone where we saw a low of 7850 and closed at 7968. S&P upgraded Indian market
which is a big trigger from current levels. We saw a pain of 400 pts in nifty and we can rightly say correction is
probably over and now our first target is 8200. So just buy.
RMCL corrected from 48 to 36 levels. Correction done now we may see 2-3 upper circuit in a row. So don’t
miss the rally.
Accumulate CMI for a target of 70.
Cni Research Limited
www.cniglobalbiz.com
3
Next Week’s Events
Monday, 29-Sep-2014
Personal Income and Outlay
Pending Home Sales
Tuesday,30-Sep-2014
Chicago PMI
Consumer Confidence
Wednesday,01-Oct-2014
Construction Spending
Motor Vehicle Sales
Thursday,02-Oct-2014
Factory Order
Jobless Claims
Friday, 03-Oct-2014
International Trade
Employment Situation
Cni Research Limited
GLOBAL STORY
Expiry completed and pain too buried. It was a roll
pain of typical cash settlement market. How can
you stop insider trading...? JP Associates someone
sold stock worth Rs 34 in VWAP and stock was
down 20% on the settlement day. In the settlement
stock was down more than 60% . Of course there
was some news around the selling helping the
stock to fall all the way. We are firm believer all this
could happen only because of cash settlement
system where selling in FO and then VWAP selling
on the last few sessions is enough to create
carnage on the stock. Similar was the case with
Apollo Tyre and HDIL. Both stocks rose 400% post
this kind of movement for some reason say
promoters selling or co trying to chew a bullet. This
clearly leads to a conclusion that even JPA will rise
400% from the low of Rs 25 in next 6 to 12 months.
Let us see whether this happens or not.
This kind of movement also raised question marks
on QIP instruments which are carrying free shares
instead of preferential issues which carry 12
months lock in. Price rigging is rampant in all the
QIP cases so that QIP can get subscribed at higher
levels and post QIP stocks crash from 22% to 65%
as investors are left in dark. May be those who
ramp up prices pre QIP come for profit booking and
even some of the weak players which subscribe to
QIP for some off record consideration come for exit
even at loss. It is loss of public money at the cost of
personal gains. There is no allegation on any one
but this is what seems to be happening in the
industry hence many genuine FII avoid QIP and
also are scared about India. They do not prefer
preferential issues as their name comes in public
domain. GDR remained on scanner for a long time.
FCCB is already not a favoured instrument any
more as investors stuck there very badly.
Secondary market has liquidity issues as SHARES
are not an assets class thanks to cash settlement
system. Thus the dependence of FII is very high on
good intermediary. This is helping only few class
intermediaries and rest of the pack is struggling
even today.
www.cniglobalbiz.com
4
We recently met close to 35 FII in Singapore H K and some other parts of the world but found that they have
legitimate issues in dealing with Indian securities. The NAMO magic has really worked but before it turns into
an investment opportunity for long only funds all frontline stocks have crossed reasonable valuations forcing
them to have look as sub standard quality stocks in QIP.
Time has come to either raise the bar for QIP issues or FII needs to change their approach. Instead of talking
only large cap and A gr stocks they should start thinking to invest in mid caps and small caps where value is
there. They should select stocks with reasonable p e ratio and having potential to grow CAGR 35 to 50 %
every year even though the stock could be small cap segment. There are exciting opportunities.
Many FII have reconciled to have a look at mid caps but the bridge is not easy for them. Even before they
realized the opportunity Indian operators did what was not visible. They have made many quality MID CAP
stocks so expensive that even good long only FII are afraid to get into it. Because they know history can repeat
here and they can be victimized. We are trying to impress many FII to have a look at small co companies
which will become very soon mid cap companies. We had shown them stocks like Cera Sanitation at Rs 100
pre bonus now it is Rs 1400 ex bonus. Now they are realising the missing link. We think post 10000 many FII
will open their purse for good quality almost debt free growing small cap companies which are in niche
segment say railway, defence, engineering, IT, gas and offshore, FMCG, packaging, retail ( e com), lingerie's (
latest Indian data suggest 47% Indian women's are still bra less) and finally consumables.
As a attitude they are really afraid to invest in Indian companies. As a matter of fact they are now turning into
structured deals of 10 to 12% returns which is still higher from their capital return perspective.
The outcome of our interaction with these funds is very clear. Now they are ready to pay some cost to hear the
management out. This is on the same lines of research. Brokers research as well as management presentation
is for some consideration say deals and brokerages which is always considered as having vested interest.
They are showing good response to all road shows. They are willing to meet promoters. In fact the US
conference of 2 leading brokers found very good response.
We have been approached by at least 5 FII for research tie ups exclusively for them. Here our role will to make
a due diligence on the co zeroed by them on various aspects which will help them take their investment
decisions. This is simply because they are getting every day 100's of research reports from brokers and they
are not sure about the selection of their investment calls. Based on our inputs they might take their decision.
This trend is catching in US and other parts of world where they have no direct access to specific research.
This is a great news for even smaller companies like CNI which has a proven track record of research. This will
go long way in business visibility.
We are sure money will come to India in a big way. We expect over trillion usd inflow in next 3 - 4 years not
ruled out hence there is enough opportunity to make killing in Indian markets. We do not suggest to rush for
run up large caps and mid caps. Instead focus on small good companies where results are robust.
Management is clean and co is growing at 35 to 40% space. Co is not "ME TOO" kind space. We are sure you
invest today and sit tight FII will come in these co's as very soon they will open the gates to small caps too.
History will repeat. But this time quality will be preferred thanks to internet revolution which is giving access to
lot information which was hither to not available in public domain.
We stick with our targets of 8500 8888 before March 2015. Eventually we will cross Nifty 10000 in many stocks
will become multi baggers.
At CNI we repeat next 4 5 years will be a BULL market and only a buy on dip strategy will work. Those who
try time the market will get framed. e g many have gone long R Com at 150 , the QIP was at 142 and stock
broke Rs 100 all the way giving more than 50% loss to investors. Now imagine those who made some money
in trading post MODI election and did ride a stock like GMR R Com JPA KTK Suzlon etc have not only eroded
their profits but lost some good amount of capital. So the bottom line is that you should avoid trading and be
investors and pick only from B gr stocks which will give you good returns.
Cni Research Limited
www.cniglobalbiz.com
5
Global Indices
Country
Indices
Date
Index
Net Change
Change
Hong Kong
Hang Seng
26/09
23,678.41
-89.72
-0.38
Singapore
Straits Times
26/09
3,292.21
+1.22
+0.04
South Korea
Seoul Composite
26/09
4,512.19
+45.44
+1.02
United States
NASDAQ
26/09
17,113.15
+167.35
+0.99
United States
DJIA
26/09
1,982.85
+16.86
+0.86
United States
S&P 500
26/09
16,229.86
-144.28
-0.88
Japan
Nikkei 225
26/09
6,649.39
+9.68
+0.15
United Kingdom
FTSE 100
26/09
1,840.50
-2.61
-0.14
Malaysia
KLSE Composite
26/09
5,132.56
-68.82
-1.32
Indonesia
Jakarta Composite
26/09
1,600.16
+8.17
+0.51
Thailand
SET
26/09
4,394.75
+39.47
+0.91
France
CAC 40
26/09
9,490.55
-19.46
-0.20
Germany
DAX
26/09
12,535.53
+380.32
+3.13
Argentina
MerVal
26/09
57,212.38
+1,250.30
+2.23
Brazil
Bovespa
26/09
44,884.33
+103.21
+0.23
Mexico
IPC
26/09
2,215.78
-16.52
-0.74
Austria
ATX
26/09
3,206.49
+9.59
+0.30
Belgium
BEL-20
26/09
418.49
+1.24
+0.30
Netherlands
AEX General
26/09
1,108.11
+7.07
+0.64
Spain
Madrid General
26/09
8,774.36
+1.60
+0.02
Switzerland
Swiss Market
26/09
5,316.63
-65.74
-1.22
Australia
All Ordinaries
26/09
2,347.72
+2.62
+0.11
China
Shanghai Composite
26/09
7,261.30
-32.91
-0.45
Philippines
PSE Composite
26/09
7,233.71
+0.73
+0.01
Sri Lanka
All Share
26/09
8,989.82
-21.77
-0.24
Taiwan
Taiwan Weighted
26/09
1,305.02
-0.18
-0.01
East Egypt
CMA
26/09
2,031.64
-2.47
-0.12
Cni Research Limited
www.cniglobalbiz.com
6
Bulk deal
Company Name
Date
BSE Code
ATWL
26-Sep-14
536492
Shree Mahadev Trader
B
88000
61.18
FORCEMOT
26-Sep-14
500033
DIPAN MEHTA SHARE AN
S
69455
1168.01
FORCEMOT
26-Sep-14
500033
DIPAN MEHTA SHARE AN
B
69295
1168.26
GODREJIND
26-Sep-14
500164
NYRIKA VIJAY CRISHNA
S
2800000
304.35
GODREJIND
26-Sep-14
500164
GODREJ N BOYCE MFG C
B
5600000
304.35
GODREJIND
26-Sep-14
500164
FREYAN VIJAY CRISHNA
S
2800000
304.35
GOLDCORP
26-Sep-14
505576
FPI-PADMAKSHI INSURA
B
59000
30
GOLDCORP
26-Sep-14
505576
PADMAKSHI FINANCIAL
S
59000
30
HISARMET-$
26-Sep-14
590018
VIVEK LAMBA
S
43377
23.27
IFLPROMOT
26-Sep-14
511682
SAMIR KISHOR THAKKAR
B
391000
4.5
Jaiprakash Associates Li
25-Sep-14
JPASSOCIAT
SHAASTRA SECURITIES
B
14981276
26.85
Jaiprakash Associates Li
25-Sep-14
JPASSOCIAT
CITIGROUP GLOBAL MAR
S
12570991
27.34
Jaiprakash Associates Li
25-Sep-14
JPASSOCIAT
SHAASTRA SECURITIES
S
14981276
26.86
REI Six Ten Retail Limit
25-Sep-14
REISIXTEN
MALLINATH SHARES & S
B
1027676
0.35
REI Six Ten Retail Limit
25-Sep-14
REISIXTEN
MALLINATH SHARES & S
S
27676
0.35
Sharda Cropchem Limited
25-Sep-14
SHARDACROP
HDFC MF PRUDENCE FD
B
855000
262.18
Sudar Industries Limited
25-Sep-14
SUDAR
PRUDENT FINTRADE PRI
B
617
42.85
Sudar Industries Limited
25-Sep-14
SUDAR
PRUDENT FINTRADE PRI
S
120617
42.48
VKS Projects Limited
25-Sep-14
VKSPL
GREEN VENTURE SECURI
B
5905299
0.4
VKS Projects Limited
25-Sep-14
VKSPL
GREEN VENTURE SECURI
S
7034950
0.35
Dolphin Offshore Enterp
24-Sep-14
DOLPHINOFF
DECOR SECURITIES PVT
S
87000
131.85
Hindustan Motors Limite
24-Sep-14
HINDMOTORS
R R BAMFIELD INVESTM
S
972180
8.86
Lyka Labs Ltd
24-Sep-14
LYKALABS
TANVI FINANCIAL SERV
B
150000
19.39
R. S. Software (I) Ltd.
24-Sep-14
RSSOFTWARE
RELIANCE WEALTH MANA
S
87135
718.74
Sharda Cropchem Limited
24-Sep-14
SHARDACROP
HDFC MF PRUDENCE FD
B
970000
241.64
Speciality Rest Ltd
24-Sep-14
SPECIALITY
SAIF INDIA IV FII HO
B
1067561
135
Speciality Rest Ltd
24-Sep-14
SPECIALITY
ANJAN CHATTERJEE
S
1100000
135.01
Bharatiya Global Info L
23-Sep-14
BGLOBAL
SHAH HARSH DINESH
B
150000
4.3
Decolight Ceramics Limi
23-Sep-14
DECOLIGHT
ANKITKUMAR DINESHKUM
B
245000
2.4
Decolight Ceramics Limi
23-Sep-14
DECOLIGHT
SOWMYA DESHPANDE
S
244760
2.4
Intrasoft Tech. Ltd
23-Sep-14
ISFT
SSL CONSOLIDATED LTD
B
92000
54.75
Intrasoft Tech. Ltd
23-Sep-14
ISFT
GOVERDHAN EXPORTS LT
S
147000
54.83
Cni Research Limited
Client Name
www.cniglobalbiz.com
Deal Type
Quantity
Price (Rs)
7
Call put option
Option Month Strike Price
PUT
Volume
October - 7050.00
0
Best
Buy
1.1
October - 7100.00
281100
2.1
October - 7150.00
0
2
October - 7200.00
1155450
October - 7250.00
2600
October - 7300.00
Best
Sell
0
CALL
LTP
OI
Change
OI(%)
Volume
0
0
0
0
Best
Buy
719
Best
Sell
1246.9
LTP
OI
Change
OI(%)
1056.3
9850
0
2.2
2.45
244350
25.73
15050
912.25
925.05
920.05
24450
-10.77
0
0
0
0
0
619.2
1146.8
0
0
0
2.55
2.85
2.75
384100
36.93
16200
811.9
824
819.6
97700
-1.36
2.1
4
3.1
1400
1300
0
524.4
894
0
0
0
2606150
3.55
3.8
3.75
736150
45.31
22300
682
764.15
720.5
71300
2
October - 7350.00
1200
3
9.6
4
1200
700
0
431.35
794
0
0
0
October - 7400.00
3638900
6
6.1
6.05
1467900
31.67
60450
624.55
628.9
623.3
241050
0.1
October - 7450.00
8850
7.15
10.15
8.5
4300
0
0
337.85
698
0
0
0
October - 7500.00
5891250
10.25
10.45
10.4
2390500
18.37
159450
527.45
537
529.5
333150
0.26
October - 7550.00
36450
12.2
14.3
12.3
12850
0
0
246.9
602
0
0
0
October - 7600.00
8602800
17.15
17.4
17.4
2522600
19.61
164200
437.45
441
440.1
418700
1.2
October - 7650.00
231750
20.15
22
21
70500
3928.6
0
167.1
633.9
0
0
0
October - 7700.00
11395500
28.25
28.7
28.25
2891050
23.08
159150
351.05
354.65
351.95
497100
7.04
October - 7750.00
564600
35.55
36
36.7
95450
179.5
0
88
446
0
0
0
October - 7800.00
19856850
44.9
45.75
44.9
4606250
18.91
1168650
270.2
274
272.7
673550
44.65
October - 7850.00
927950
55.6
56.7
56.3
155500
129.35
52600
221.55
235
221.1
5150
186.11
October - 7900.00
22082200
68.5
69.4
68.5
3700050
-4.17
5215000
196.05
199.9
199.5
1006750
62.48
October - 7950.00
578950
82.7
86.4
86.15
202300
43.37
586450
162.65
167.85
163.55
79050
22.84
October - 8000.00
9409400
104.05
104.15
103.75
2992750
-6.78
17896900
136
137.9
136.8
2774500
38.31
October - 8050.00
103650
116.55
128.95
128
61150
-6.93
687950
108.6
111.35
109.15
138850
48.58
October - 8100.00
2754450
150.6
151.9
149.6
1534800
-15.24
17325400
86.05
87.4
86.2
3699400
14.57
October - 8150.00
28000
170
197.2
184
32600
-22.1
718150
65.7
67
65.8
210250
34.86
October - 8200.00
811700
210.4
214.1
212.3
1030450
3.47
16027750
50.15
50.2
50.15
4614550
27.26
October - 8250.00
750
150.75
289.95
245.45
3050
3.39
363450
36.15
38
38.4
159150
18.02
October - 8300.00
139900
280.05
288.45
287.65
780450
-0.06
9822350
27
27.25
27
3356550
20
October - 8350.00
0
234.2
578.6
0
0
0
120100
19.4
20.2
20.05
66450
23.74
October - 8400.00
72350
370.1
372.45
371
209450
26.02
6298650
13.15
13.5
13.5
2222900
11.29
October - 8450.00
0
351.05
460
0
0
0
54450
9.5
10.7
10.7
17900
4.07
October - 8500.00
112700
457.7
463.8
463.2
498150
4.39
4557100
6.5
6.65
6.7
2531000
2.33
Cni Research Limited
www.cniglobalbiz.com
8
DISCLAIMER STATEMENT
This document is provided for assistance only and is not intended to be and must not alone be taken as the basis for an
investment decision. Nothing in this document should be construed as investment or financial advice, and nothing in this
document is solicitation to buy or sell the securities of companies referred to in this document. The intent of this document
is not in recommender nature. Each recipient of this document should make such investigations as it deems necessary to
arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including
the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment.
The investment discussed or views expressed may not be suitable for all investors.
The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and
should not be treated as endorsement of the views expressed in the report. This information is subject to change without
any prior notice. The Company reserves the right to make modifications and alternations to this statement as may be
required from time to time without any prior approval.
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