HAPPY DIWALI TO ALL

UN-REGULATED REGULATOR

SECURITIES AND EXCHANGE BOARD OF INDIA ALSO KNOWN AS SEBI, IS SITTING QUITE ON THE UN ORDERLY MOVEMENT OF SOME OF THE STOCKS IN INDIAN CAPITAL MARKET. THIS IS THE SAME SEBI, WHO LAUNCHED ENQUIRY IN SOME OF THE UN ORDERLY STOCKS MOVEMENT PREVIOUSLY. LIKE ATLANTA LIMITED AND NISSAN COPPER LIMITED, AND THE CULPRIT WERE PUNISHED IN THAT CASE. IN ATLANTA MATTER SEBI ENQUIRY COMMITTEE FOUND THAT PROMOTERS WERE MANIPULATING THE STOCK PRICE AND IN CASE OF NISSAN COPPER LTD, THREE ENTITIES WERE FOUND OF MANIPULATING THE SHARE PRICES OF THE STOCK ON THE LISTING DAY ITSELF. SO WHY IS SEBI KEEPING QUITE IN UN ORDERLY MOVEMENT OF RELIANCE PACK. RNRL AND RPL ARE RUNNING LIKE MAD DOGS ON DALAL STREET, STILL THERE IS NO ENQUIRY, WHY IS IT SO? THIS RAISES MANY QUESTIONS’ IN MY MIND. ARE OUR MARKETS WELL GOVERNED? IF SEBI CAN LAUNCH ENQUIRY IN ABOVE MENTIONED TWO CASE THAN WHY NOT IN RELIANCE PACK. WHAT EVER THE CASE MAYBE, BOTH THE STOCKS ARE RUNNING MADLY, RNRL WHICH WAS TRADING AT 20-25 RS. IN MAY IS NOW TRADING AT Rs.185/-, AND THERE IS ONE MORE QUESTION ABOUT RNRL, WHAT THIS COMPANY DOES? ALMOST 80% OF THE INVESTORS DON’T KNOW WHAT WORK THIS COMPANY IS DOING. SEBI OFTEN SAY THAT INDIAN MARKETS ARE VERY WELL REGULATED, BUT I DON’T UNDERSTAND, WHAT IS SEBI DOING IN SAFEGUARDING THE INVESTORS INTEREST. IT IS STILL A QUESTION THAT YOU HAVE TO ANSWER. PLEASE POST YOU REPLY’S ON THIS MATTER.

THE WORLD AT OUR FEET.

Things can’t get bigger than this for India, on & off the field. From becoming T20 champs to hitting the 20K mark, it’s been a dream journey.

The first 10,000 took over 20 years. The next came in just 20 months.

IT MAY BE A HEADY COCKTAIL..

Market-cap touches Rs 62,16,907 crore ($1.58 trillion)

207 stocks touch new life high

Trading in 297 stocks frozen for want of sellers

Third-biggest single-day jump

Decent Q2 earnings, 9.4% growth

A 2% rise in RIL stock price will make Mukesh Ambani the richest Indian in the world, overtaking LN Mittal

BUT THERE ARE RIDDLES IN THE MARKET PLACE....

Despite Sebi ban on derivative-linked PNs, F&O outstanding is Rs 1 lakh crore. Why is there no unwinding? Are more investors hedging?

FII flow has been erratic in the past few weeks. If this persists, will local MFs, big corporates and insurance firms continue to buy? While FIIs have been booking profits, there is no big selloff. Why? Hedge funds are holding on to PNs, fearing they may not get a chance to get back. How long will the PN charm last?

Market is getting narrower, riskier. Fewer stocks driving Sensex. And leveraged positions ballooning. Market has factored in possible hike in CRR .

STOCKS, RUPEE SLUMP; SEBI PROPOSES FII INVESTMENT LIMIT'S THROUGH P-NOTES.

India's stocks tumbled, shutting down the Bombay Stock Exchange for an hour, and the rupee fell the most in two months after regulators proposed restrictions on investments favored by global hedge funds.

The benchmark Sensex index dropped as much as 9.2 percent after the Securities & Exchange Board of India said late yesterday it plans to limit trading by investors who buy shares anonymously, using derivatives known as participatory notes. Record share purchases had driven the Sensex up 38 percent this year to an all-time high and fueled a 12.5 percent gain in the rupee against the dollar.

Finance Minister Chidambaram said the rules were aimed at moderating capital inflows that fueled a "very steep rise'' in stocks. The central bank bought a record $39.9 billion in the eight months through August to curb gains in the rupee that have reduced earnings at exporters including Tata Consultancy Services Ltd., the country's biggest software maker.

The Bombay Stock Exchange Sensitive Index of 30 companies, or Sensex, fell as low as 17,307.90, before closing down 1.76 percent at 18,715.82. ICICI Bank Ltd., India's biggest lender by market value, fell as much as 12.5 percent and closed 3.45 percent lower at 1116.85 rupees. Reliance Industries Ltd., the nation's biggest company, gained 1.59 percent to 2690.3 rupees, rebounding from a 14 percent slump.

The rupee fell as much as 1.6 percent to 39.97 per dollar before trading at 39.55. The currency reached 39.27 on Oct. 11, the highest since February 1998.

LIGHTNING STRIKES

Seventeen trading sessions and $7.2 billion worth of net inflows. That’s exactly what foreign fund managers pumped into Indian share markets in the last one month. Unbelievable but true.
Consider this: Net inflows by foreign institutional investors (FIIs) since September 19 were just a tad less than the $8 billion they had brought into India during the whole of 2006. And in the first eight months net foreign fund inflow in stocks was $9.5 billion, Sebi data showed. Institutional dealers believe that a host of factors are forcing foreign fund managers towards such a mad rush for Indian stocks. For one, a lot of managers were underweight on India till the US Federal Reserve cut its key interest rate in mid-September. And then literally overnight India became a favoured emerging market destination among fund managers globally.
Those who were underweight on India were caught on the wrong foot. This in turn prompted these money managers to scramble for Indian stocks at whatever price, said a top dealer at a foreign banksponsored brokerage. “At any price they had to have India in their portfolio,’’ said the dealer.
In addition, a lot of hedge funds looking for quick gains in the short run are also entering India. While such hot money could be dangerous, the fact is currently they are also fuelling the market rally by pumping in money, market players said. Going forward, FIIs will look for company-specific stories to pick stocks, market players said. And deals worth $500 million to $1 billion could be a regular affair, they said. For example on Monday, six FIIs and two domestic mutual funds together bought about 2.16 crore shares of Jai Corp from three of its promoters. The total deal was worth about Rs 2,237 crore or $570 million.

ARE THERE ANY ROAD’S LEFT FOR RETAIL INVESTOR?

After a rise of approx 5000 points on Sensex and 1500 points on Nifty, are there any roads left for the retail investor. With every rise the risk on investment also rises, many analyst are saying that this is a long term bull market, but if a long term gain comes in short term, then that should be a cause of worry. Reliance Industries ltd which registered a lifetime high of 2724.7 on NSE, was trading at sub-thousand level’s in January, a stock which use to double itself in 2-3 year’s has nearly tripled it self in just a matter of 9 months. Have the fundamentals been changed? Answer is; No, as the rupee rises, the gross refining margin’s also declines, so, is the valuation given to RIL justified, well that we will only know after the 2nd quarter result. And in case of Reliance Energy, a speculators paradise, as it is called now among the top broker’s in India. Was trading at 400-500 levels, a news came that Reliance energy has won a bid for SASAN Power project in M.P. and stock is now trading at 1750 (as on 15-Oct-07), first of all project is awarded to Reliance Power, and Reliance Energy is a holding company which holds 50% in Reliance Power, and as per company’s statement project will be started by the end of 2009 and it will start generating revenues for the company by 2010. Reliance Energy has quadruple it self in 9 months, are these valuation correct, there are many stocks like this and most of them are from Reliance Pack, Like RNRL, RPL, RIIL and RCOM. RIIL (Reliance Industrial Infrastructure Ltd) which has no fundamentals, even most of the people don’t even know what this company does, even I don’t know and even not bothered to know, but now when the stock is trading at 2275, seven times what it was in January, has left me with several questions, why are people running behind such stock’s, why are people not understanding the valuations. There are many instances when the stock have risen like this and were a cause of market crash latter. And these retails investors who are feeling bullish, who doesn’t care about the valuation, blame the FII and Government for the same. I will only advice the investors to be cautious, and don’t go behind the stock that they feel are speculated, and exit the Dalal Street before it is turned into a .