Wednesday, August 26, 2009

NHPC IPO Allotment details

NHPC, largest hydro-power generation company and government owned entity, has fixed the issue price of Rs 36, at higher end of the price band. The company garnered Rs 6,038.55 crore from the issue; out of which, the government received Rs 2,012.85 crore and that will be used for infrastructure projects. The rest of the amount i.e. Rs 4,025.7 crore, the company will use for its power projects.
Shares of NHPC are expected to be listed by the first week of September, merchant bankers to the issue said.
Basis of Allotment
(Under Subscription under Employee quota have been allocated to QIB/HNI/Retail in 60:10:30 ratio)
It had launched its initial public offering (IPO) of 1,67,73,74,015 equity shares of Rs 10 each with a price band of Rs 30-36 per equity share. It opened during August 7 and August 12, 2009. The issue received overwhelming response from all categories of investors and was subscribed 23.74 times. 
Qualified institutional investors (QIBs) were the major supportive investors with their portion being subscribed 29.16 times. Non-institutional and retail investors' portion subscribed 26.7 times and 3.87 times, respectively.
The issue constituted 13.64% of the post-issue capital of NHPC. After the issue, the shareholding of the President of India shall be approximately 86.36% of the post-issue paid-up equity share capital of the company.
The proceeds of the fresh issue (after deducting the proportionate underwriting and issue management fees, selling commissions and other expenses associated with the fresh issue) will be used to part finance the construction and development costs of certain of projects, namely, Subansiri Lower, Uri – II, Chamera - III, Parbati – III, Nimoo Bazgo, Chutak, and Teesta Low Dam - IV

Tuesday, August 25, 2009

Kandhaswamy Review

'Kanthaswamy' a superhero tale with a twist (Tamil Film Review)

By Mitran

Film: "Kanthaswamy"; Director: Susi Ganesan; Cast: Vikram, Shriya Saran, Krishna, Raghuvaran, Vivek, Santhanam, Vinod Raj, Y.G. Mahendran, Arun Mathavan, Vinayak, Alex and Indrajith; Music: Devi Sri Prasad; Rating: ***

Director Susi Ganesan's "Kanthaswamy" is a typical commercial pot-boiler that has style and substance. Though the Robin Hood-like story is not new, Susi has presented it with trademark superhero-movie elements -- flashy action scenes and stunning special effects.

Yet, it's not the typical superhero film and therein lies the twist in the tale.

The movie begins with people flocking to a Murugan temple. All those who submit their woes as petitions to Lord Kanthaswamy (another name for Murugan) on a piece of paper and tie it to a tree in the temple find that their problems are all solved soon.

Meanwhile, superhero Kanthaswamy becomes a phenomenon -- a caped crusader dressed as a rooster who takes up the grievances of ordinary people and resolves them. But the local police officer (Prabhu) suspects something fishy and pokes his nose in the matter.

On the other hand, brave CBI officer Kanthaswamy (Vikram) is on a mission to unearth black money and illegal wealth amassed by the rich and corrupt that lie stashed in foreign banks. He is in for a challenge when he raids the house of tycoon PPP (Ashish Vidyarthi).

When Kanthaswamy finds unaccounted cash and documents of various foreign deals worth over Rs.1,000 crore, PPP, the seasoned criminal, is not amused. At the same time, his only daughter Subbalakshmi (Shriya Saran) pretends to have fallen in love with Kanthaswamy in an effort to take revenge on him.

Watch the film to know the connection between the masked crusader and the CBI officer.

Susi Ganesan has presented the movie with a fast-paced and stylish narrative. He has conceived and executed many scenes well. He has tried to give the old story of robbing the rich to help the poor some logical elements. The twists in the tale are interesting.

The fight sequences, especially the blind-folded action scenes in Mexico, are breathtaking. The innovative camera angles and lighting by cinematographer N.K. Ekambaram make the film visually stunning. Thotta Dharani's art work is also awesome.

On the flip side, Susi's story is disappointing. While he has worked hard to make the film stylish and sleek, one wishes he had worked harder to come up with something new.

We have seen powerful 'Good Samaritans' like Kanthaswamy in films like "Gentleman" and "Indian". We have also seen an 'alien' with extraordinary powers to eliminate the baddies in "Anniyan" and an intelligent hero diverting the black money to good causes in "Sivaji".

The major problem with the script is the length. The director could have avoided a couple of songs and halved the comedy track by Vadivelu.

Devi Sri Prasad's music goes with the movie's mood. Two of the six songs -- "Excuse me Mr. Kandasamy" and "Yen Peru Meenakumari" -- are picturised well.

Vikram comes out with flying colours. His dedicated efforts have given an extra-dimension to the character. Very few people in Indian cinema could portray the larger-than-life fantasy character as easily as Vikram. His body language when he appears with a mask and wings is amazing.

Shriya sizzles in her glamorous appearance and charming acting. Prabhu renders a neat performance but he is fast becoming predictable in the role of an investigative cop. The characterization of villains leaves much to be desired. Vadivelu's comedy track passes muster.

"Kanthaswamy" is for those looking for sheer entertainment. Thanks Aravindan.

Growing Companies

List of Fastest growing companies. Worth to look indepth and invest for long term. Reap the benefits.

Ramco Industries - Value Buy

Scrip:                Ramco Industries
BSE:                532369  
NSE:                RAMCOIND  
ISIN:                 INE614A01010
Segment:          Building products, Textiles, Wind power mill
CMP:                1156
Div Yield
52WH:                          1250
52WL:                           346
All Time High:                1875
YoY Income
Stock Split
from Face value 10 to 1
1 bonus share for one share held
QoQ Net Profit
up by 5%
YoY Net Profit
up by 44%
QoQ sales
Up by 16%
YoY sales
Up by 17%

Stock split and Bonus is under approval of Sep3, EGM meeting.
 Fundamentally good stock with diversified portfolio
Good dividend records
 Buy one share now for Rs 1150; by next month (after Sep3), it will become 20 shares of Rs 50 each.
Other companies in the process of split and bonus
Hindustan national glass
FCS software
HBL Power

Today sensex and nifty

Indian shares provisionally rose 0.3 percent on Tuesday, led by top vehicle maker Tata Motors (TAMO.BO: Quote,Profile, Research) after a brokerage upgrade, and IT-services exporters as the rupee weakened.
The 30-share BSE index .BSESN provisionally ended up 52.26 points at 15,681.01, with 12 stocks gaining.
The 50-share NSE index .NSEI provisionally closed up 0.3 percent at 4,656.95.


The government on Monday fixed a price band of Rs950-1,050 per share for the initial public offering (IPO) of Oil India Ltd, and will raise up to Rs4,982 crore. The price band was fixed by a group of ministers headed by finance minister Pranab Mukherjee on Monday evening, officials said

Monday, August 24, 2009



1. What are derivatives?
Derivatives, such as futures or options, are financial contracts which
derive their value from a spot price, which is called the “underlying”. For
example, wheat farmers may wish to enter into a contract to sell their
harvest at a future date to eliminate the risk of a change in prices by that
date. Such a transaction would take place through a forward or futures
market. This market is the “derivatives market", and the prices of this
market would be driven by the spot market price of wheat which is the
“underlying”. The term “contracts" is often applied to denote the specific
traded instrument, whether it is a derivative contract in wheat, gold or
equity shares. The world over, derivatives are a key part of the financial
system. The most important contract types are futures and options, and
the most important underlying markets are equity, treasury bills,
commodities, foreign exchange, real estate etc.

2. What is a forward contract?
In a forward contract, two parties agree to do a trade at some future date, at a stated price and quantity. No money changes hands at the time
the deal is signed.

3. Why is forward contracting useful?
Forward contracting is very valuable in hedging and speculation. The
classic hedging application would be that of a wheat farmer forward -
selling his harvest at a known price in order to eliminate price risk.
Conversely, a bread factory may want to buy bread forward in order to
assist production planning without the risk of price fluctuations. If a
speculator has information or analysis which forecasts an upturn in a
price, then he can go long on the forward market instead of the cash
market. The speculator would go long on the forward, wait for the price
to rise, and then take a reversing transaction making a profit.


4. What are the problems of forward markets?
Forward markets worldwide are afflicted by several problems:
(a) lack of centralisation of trading,
(b) illiquidity, and
(c) counterparty risk.
In the first two of these, the basic problem is that of too much flexibility
and generality. The forward market is like the real estate market in that
any two persons can form contracts against each other. This often makes
them design terms of the deal which are very convenient in that specific
situation for the specific parties, but makes the contracts non-tradeable if
more participants are involved. Also the “phone market" here is unlike
the centralisation of price discovery that is obtained on an exchange,
resulting in an illiquid market place for forward markets. Counterparty
risk in forward markets is a simple idea: when one of the two sides of the
transaction chooses to declare bankruptcy, the other suffers. Forward
markets have one basic issue: the larger the time period over which the
forward contract is open, the larger are the potential price movements,
and hence the larger is the counter- party risk.
Even when forward markets trade standardized contracts, and hence avoid the problem of illiquidity, the counterparty risk remains a very real problem.

5. What is a futures contract?
Futures markets were designed to solve all the three problems (listed in
Question 4) of forward markets. Futures markets are exactly like forward
markets in terms of basic economics. However, contracts are
standardised and trading is centralized (on a stock exchange). There is
no counterparty risk (thanks to the institution of a clearing corporation
which becomes counterparty to both sides of each transaction and
guarantees the trade). In futures markets, unlike in forward markets,
increasing the time to expiration does not increase the counter party risk.
Futures markets are highly liquid as compared to the forward markets.

6. What are various types of derivative instruments traded at NSE?
There are two types of derivatives instruments traded on NSE; namely Futures and Options :
Futures : A futures contract is an agreement between two parties to buy or sell an asset at a certain time in the future at a certain price. All the futures contracts are settled in cash at NSE.
Options: An Option is a contract which gives the right, but not an obligation,
to buy or sell the underlying at a stated date and at a stated price. While a
buyer of an option pays the premium and buys the right to exercise his
option, the writer of an option is the one who receives the option premium
and therefore obliged to sell/buy the asset if the buyer exercises it on him.
Options are of two types - Calls and Puts options :
"Calls" give the buyer the right but not the obligation to buy a given quantity
of the underlying asset, at a given price on or before a given future date.
"Puts" give the buyer the right, but not the obligation to sell a given quantity of underlying asset at a given price on or before a given future date. All the options contracts are settled in cash.
Further the Options are classified based on type of exercise. At present the Exercise style can be European or American.
American Option - American options are options contracts that can be exercised at any time upto the expiration date. Options on individual securities available at NSE are American type of options.
European Options - European options are options that can be exercised
only on the expiration date. All index options traded at NSE are European
Options contracts like futures are Cash settled at NSE.

7. What are various products available for trading in Futures and
Options segment at NSE?
Futures and options contracts are traded on Indices and on Single stocks.
The derivatives trading at NSE commenced with futures on the Nifty 50
in June 2000. Subsequently, various other products were introduced and

presently futures and options contracts on the following products are available at NSE:
1. Indices : Nifty 50 CNX IT Index, Bank Nifty Index, CNX Nifty
Junior, CNX 100 , Nifty Midcap 50, Mini Nifty and Long dated
Options contracts on Nfity 50.
2. Single stocks - 228

8. Why Should I trade in derivatives?
Futures trading will be of interest to those who wish to:
1) Invest - take a view on the market and buy or sell accordingly.
2) Price Risk Transfer- Hedging - Hedging is buying and selling futures
contracts to offset the risks of changing underlying market prices.
Thus it helps in reducing the risk associated with exposures in
underlying market by taking a counter- positions in the futures market.
For example, an investor who has purchased a portfolio of stocks
may have a fear of adverse market conditions in future which may
reduce the value of his portfolio. He can hedge against this risk by
shorting the index which is correlated with his portfolio, say the
Nifty 50. In case the markets fall, he would make a profit by
squaring off his short Nifty 50 position. This profit would
compensate for the loss he suffers in his portfolio as a result of the fall in the markets.
3) Leverage- Since the investor is required to pay a small fraction of the
value of the total contract as margins, trading in Futures is a leveraged
activity since the investor is able to control the total value of the
contract with a relatively small amount of margin. Thus the Leverage
enables the traders to make a larger profit (or loss) with a
comparatively small amount of capital.

Options trading will be of interest to those who wish to :
1) Participate in the market without trading or holding a large quantity
of stock.
2) Protect their portfolio by paying small premium amount.


Benefits of trading in Futures and Options :

1) Able to transfer the risk to the person who is willing to accept them
2) Incentive to make profits with minimal amount of risk capital
3) Lower transaction costs
4) Provides liquidity, enables price discovery in underlying market
5) Derivatives market are lead economic indicators.

9. What are the benefits of trading in Index Futures compared to any
other security?

An investor can trade the 'entire stock market' by buying index futures
instead of buying individual securities with the efficiency of a mutual

The advantages of trading in Index Futures are:

• The contracts are highly liquid
• Index Futures provide higher leverage than any other stocks
• It requires low initial capital requirement
• It has lower risk than buying and holding stocks
• It is just as easy to trade the short side as the long side
• Only have to study one index instead of 100s of stocks

10. How do I start trading in the derivatives market at NSE?
Futures/ Options contracts in both index as well as stocks can be bought
and sold through the trading members of NSE. Some of the trading
members also provide the internet facility to trade in the futures and
options market. You are required to open an account with one of the
trading members and complete the related formalities which include
signing of member-constituent agreement, Know Your Client (KYC) form
and risk disclosure document. The trading member will allot to you an
unique client identification number. To begin trading, you must deposit


cash and/or other collaterals with your trading member as may be stipulated by him.

11. What is the Expiration Day?
It is the last day on which the contracts expire. Futures and Options contracts expire on the last Thursday of the expiry month. If the last Thursday is a trading holiday, the contracts expire on the previous trading day. For E.g. The January 2008 contracts mature on January 31, 2008.

12. What is the contract cycle for Equity based products in NSE ?
Futures and Options contracts have a maximum of 3-month trading cycle -
the near month (one), the next month (two) and the far month (three),
except for the Long dated Options contracts. New contracts are introduced
on the trading day following the expiry of the near month contracts. The
new contracts are introduced for a three month duration. This way, at any
point in time, there will be 3 contracts available for trading in the market
(for each security) i.e., one near month, one mid month and one far month
duration respectively. For example on January 26,2008 there would be
three month contracts i.e. Contracts expiring on January 31,2008,
February 28, 2008 and March 27, 2008. On expiration date i.e January
31,2008, new contracts having maturity of April 24,2008 would be
introduced for trading.

13. What is the concept of In the money, At the money and Out of
the money in respect of Options?
In- the- money options (ITM) - An in-the-money option is an option that
would lead to positive cash flow to the holder if it were exercised
immediately. A Call option is said to be in-the-money when the current
price stands at a level higher than the strike price. If the Spot price is much
higher than the strike price, a Call is said to be deep in-the-money option.
In the case of a Put, the put is in-the-money if the Spot price is below the
strike price.
At-the-money-option (ATM) - An at-the money option is an option that

would lead to zero cash flow if it were exercised immediately. An option on the index is said to be "at-the-money" when the current price equals the strike price.
Out-of-the-money-option (OTM) - An out-of- the-money Option is an
option that would lead to negative cash flow if it were exercised
immediately. A Call option is out-of-the-money when the current price
stands at a level which is less than the strike price. If the current price is
much lower than the strike price the call is said to be deep out-of-the money.
In case of a Put, the Put is said to be out-of-money if current price is above
the strike price.

14. Is there any Margin payable?
Yes. Margins are computed and collected on-line, real time on a portfolio basis at the client level. Members are required to collect the margin upfront from the client & report the same to the Exchange.

15. How are the contracts settled?
All the Futures and Options contracts are settled in cash on a daily basis
and at the expiry or exercise of the respective contracts as the case may
be. Clients/Trading Members are not required to hold any stock of the
underlying for dealing in the Futures / Options market. All out of the money
and at the money option contracts of the near month maturity expire worthless on the expiration date.

Tuesday, August 18, 2009

Top 25 companies based on 3-year Net Profit CAGR with TTM Income over Rs.2500 crores


3-year CAGR %TTM (Rs. Crores)TTMGR %TTMLatest


S.No.Company NameIncomeProfitIncomeProfitIncomeProfitEPSResult



1Lanco Infratech Ltd.238.61201.997434.37355.64103.12-1.7416.17June'09


2India Cements Ltd.29.13112.083927.94434.324.71-27.1615.38June'09


3Aban Offshore Ltd.89.7786.153562.68541.9838.15136.86143.42June'09


4Yes Bank103.3676.442640.00349.5946.4260.1111.77June'09


5Shriram Trans. Finance Co.63.7271.593930.58633.2038.8738.1129.93June'09


6Idea Cellular Ltd.50.2962.0310947.09934.8447.18-6.223.02June'09


7Ultratech Cement Ltd.24.8162.016951.061129.7820.8311.5090.75June'09


8Tech Mahindra50.0861.244219.97866.986.15104.1671.14June'09


9Indusind Bank25.0559.122984.07215.7431.70166.586.07June'09


10Bharti Airtel47.3457.0739385.578340.2231.7116.8443.93June'09


11Welspun Gujarat Stahl Rohren47.6556.196683.26300.6455.30-14.8916.11June'09


12Axis Bank55.9855.2614705.252047.2649.8666.9656.91June'09


13Sesa Goa44.2655.254928.641777.335.80-12.5522.58June'09




15Sintex Industries Ltd.53.9152.313165.83329.2415.9129.7124.30June'09


16L & T31.6350.9635231.874577.4226.6199.1078.08June'09


17Torrent Power Ltd.19.3550.564588.03446.2817.1694.809.45June'09


18Jindal Saw Ltd.29.1448.996006.24413.6819.6821.4479.37June'09


19Pantaloon Retail66.8248.396064.69136.6228.8021.877.80


20Sun Pharma34.2146.914084.871480.124.67-15.9671.46June'09


21Simplex Infrastructures Ltd.52.2443.654805.82110.7847.322.1722.31June'09


22Gitanjali Gems Ltd.28.4143.055224.60154.262.56-7.3118.13June'09


23Lupin Ltd.29.8242.593908.40569.0822.0022.5468.44June'09


24Uco bank23.8041.559725.80603.1327.7846.1310.98June'09


25Exide Industries Ltd.34.5741.343394.96324.599.6723.694.06June'09