IPO DETAILS: PIPAVAV SHIPYARDS LTD

Price Band- Rs.55-60, Face Value- Rs.10
Issue opens on- 16th September 2009, Wednesday
Issue closes on- 18th September 2009, Friday
QIB Book- 5,09,10,135 shares (60% of Net issue)
HNI Book- 84,85,022 shares (10% of Net issue)
Retail Book- 2,54,55,068 shares (30% of Net issue)
Employee Reservation- 6,00,000 shares
Total No. of Shares offered- 8,54,50,225 shares or 12.8%
Equity Shares outstanding after the Issue--665,798,388 Sh
Equity Shares outstanding prior Issue-580,348,163 Sh
Total Size of the Issue- Rs. 469.97 Crs. - Rs. 512.7 Crs. (Approximately)
Lead Manager- Kotak, SBI, Enam, Motilal, JM, and Citigroup
Registrar- Karvy Computershare Private Limited.
Debt equity ratio- 0.7:1


Major PE investors-
Punj Lloyd currently holds 22.34% stake in the company at Rs.27, Amout- Rs 350cr. Sea King Infra(SKIL)at Rs.10 and they combine holds 45.5% stake.
Trinity capital- Rs.25, Amount- Rs.114.75cr, Post issue holding- 6.89%, 2i capital- Rs.25, Amount- Rs.100cr, Post issue holding- 6.01%, New York Life Investment Management India Fund(NYLIM)- Rs.25, Amount- Rs.66.52cr, Post issue holding- 4%, Citadel MT Trading- Rs.45, Amount- Rs.103.5cr, Post issue holding- 3.45%, SCB Asian Infrastructure Fund- Rs.45, Amount- Rs.51.75cr, Post issue holding- 1.73%, Blackstone, Merrill Lynch, Galleon, Manz Retail (a Future Group entity), Deutsche Bank -All at Rs.80/Sh- below 1% - stakes in the firm.
Other are Infrastructure Leasing & Finance Services (IL&FS), Export Import Bank of India (EXIM Bank), UTI Mutual Fund and Industrial & Development Bank of India (IDBI).


Company details-Pipavav is located on the south western coast of Gujarat and claims that it will be the biggest shipyard upon completion in India. The shipyard is spread over an area of 198.92 hectares, which also comprises of a special economic zone (SEZ).It plans to use the proceeds for the construction of shipbuilding facilities, repair and offshore business and for general corporate purposes.


Valuations- The net worth of Company was Rs. 12,55.076cr as of March 31, 2009. The book value per Equity Share was Rs.21.63 as of March 31, 2009 Pipavav is being valued at 1.1X EV/Order book even at the lower end of the price band. This is as compared to 0.2X for Indian shipyards and 0.3-0.5X for global shipyards, said investment bank Noble Group in its research note. Given the uncertain order book, the valuation seem to be a little aggressive.
Pipavav has said that it has an order book of $920 million, which includes 12 offshore supply vessels from ONGC and an order for 22 dry bulk carriers from three European shipping companies. The order with the European customers is being renegotiated given the downturn,though the impact on order book is not known.
Pipavav Shipyard, co-owned by SKIL Infrastructure and Punj Lloyd, is building a shipyard in Gujarat at a cost of about Rs 3,000 crore, of which it has already spent Rs 2,086 crore.

MY STOCK PICK: GILLETTE INDIA

As we all know that India is enjoying the demographic dividend, as more than 40% of Indian population is between the age group of 20 – 40 years, and with the population of 1.18 billion in India a 40% means nearly 47.2 cr people are young and if we assume that from this young population minus females needs shaving kit every morning then for next 20-30 years the consumption & sales of these products would be growing Right!! and the company would be delivering consistent performance.But this is just an assumption..what product am I talking about….. It’s GILLETTE!!

Gillette India is an NSE BSE listed company jointly promoted by House of Poddar Enterprise and Gillette Company, U.S.A. (Gillette). A company engaged in manufacturing shaving blades (7 O’clock, Ejtek shaving brush, Gillette Mach- 3, Mach 3 turbo).Just look at the details and you will understand

Details as on 04-Sep-2009

Share price- Rs.1,008.35;

Market Cap- Rs.3,290.94 cr;

52 Week- H- Rs.1,079.90; L- Rs.520;

P/E- 29.09; EPS- Rs.34.70;

Book value – Rs.165.27;

Dividend – Rs.12.50; Fv- Rs.10;

Dividend Ex-date- 15-oct-09;

Net Sales- Rs.661.51 cr; PBT- Rs.177.01 cr; Total Debt- 0.00;

Net Profit- Rs.113.13 cr; Reserves- Rs.458.30;

Total Share Issued- 3,25,85,217 shares;

Public Shareholding – 36,73,368 shares; Public Shareholding in %- 11.27%;

Promoter’s holding- 2,89,11,849 shares; Promoter’s holding in %- 88.74%;

Procter & Gamble India holds 41.02 % stake in Gillette India, even one of the most smart investor is into it. R.S. Damani holds 1.06 % in Gillette India. Gillette India,have its competitors like HUL,Dabur,Colgate,Godrej in personal care segment but non of these can compete Gillette in male personal care segment, (you can survey it by your self)

Gillette India is a best buy at Rs.800- 850, and should accumulate on further dips.

Pass on the legacy to your future generation. A DEBT FREE COMPANY at price of Rs.800-850 is definately a best buy. Gillette India have given 1:1 bonus in 1989,

I am not giving the price target as I believe this stock is meant for long term holding and not for shortterm gains. Yes it will not give you instant gains,it is a lazy kind of stock but with an extremly promising fundamentals.Daily vol is around 20,000 sh from which 35 % is on delivery basis.

BET ON : VIDEOCON

If you’re looking to invest in a solid Indian consumer electronics company then Videocon is probably an ideal fit for you. Its stock is not priced too high and a single share of the company is currently trading under the Rs.173 range on the Sensex . It’s a decent fit for intraday movements but considering the situation that the company has been in and the progress it is slowly making. Videocon is a pretty good and robust long term stock. If you have an investment horizon of 1-3 yrs then you should take a look and consider Videocon. A best buy under Rs.150,

Market Cap of Rs.3,964.33, EPS-18.88, P/E-9.16, Book Value of Rs.294.96,

Price/Book- 0.65, Div(%)-10.00, Div Yield(%)-0.52, Industry P/E 4.70

A few years ago Videocon was facing tough competition from foreign companies that had just set up base in India. LG and Samsung had begun to take root in India. They arrived with a host of innovative schemes and products and turned the consumer electronics division in India on its head. Many Indian companies had to match up, either sell out, shut shop or compete on the same level as these companies who had both the resources and the technology to turn profitable in India.

Companies like BPL were beaten down, Onida barely survives .Videocon on the other hand weathered the storm and has gone from strength to strength in the past few years.

Videocon’s bread and butter is without a doubt its television division. The company as it stands is the world’s third largest maker of television picture tubes.

It’s got a worldwide manufacturing presence and has started to boost its sales in other countries too. The company’s acquisition of Thomson has greatly benefitted its television business.

Even though it is not a market leader in televisions in India its manufacturing capabilities allow it to make money. Many companies use Videocon’s technology and license their products to be manufactured by Videocon before retailing them under their own brand names.

The company’s also got a decent enough presence in the field of washing machines, refrigerators and other home appliances.

Recently, Videocon has initiated a total brand makeover with a greener, more environmental friendly theme. The company has plans to do well outside India and will be helped by this new marketing campaign which is projecting the company as one that has had a major overhaul.

Pretty soon the company is also expected to enter the fast growing DTH space with its own Satellite TV service. Of late under the astute leadership of Mr.Venugopal Dhoot, the company has been diversifying into sectors different from its core services including the competitive mobile services market. Its sales have shown a capacity to grow and the company is making money.

Also the company has oil and gas joint venture which extracts 50,000 barrels of oil per day.which is 7% of all oil in the private sector in India.Videocon has bagged exploration and production contracts in countries like Oman, Australia and the Timor Sea near Indonesia.

Besides this it is also in the glass mkt. Videocon produces a superior range of panels and funnels to meet the demand for large-size, flat, and slim CRT display products.

In view of all this it is a good long term bet.

BSE : Declared dividend of Rs 4 a share (or 400%).

A higher income from investments helped the Bombay Stock Exchange (BSE) post a rise in net profit, even though the Asia’s oldest bourse recorded a flat growth in revenue due to lower transaction charges and a drop in income from penalties, fees and other charges in the year ended March 31, 2009.

The BSE board has declared a dividend of Rs 4 a share (or 400%) on the post-bonus equity of Rs 10.2 crore, resulting in a dividend outgo of Rs 42 crore. The dividend will go to a string of local and foreign shareholders, with the top 20 receiving 48% of the payout.

Deutsche Boerse, Singapore Exchange, SBI, LIC, Dubai Financial Group, Atticus Mauritius, Acacia Banyan Partners, Caldwell Asset Management and Bajaj Holdings are among the top BSE shareholders. The exchange posted a total income of Rs 421 crore against Rs 420 crore in the previous year.

Brokers attributed the flat growth to a sharp fall in cash and derivatives turnover which affected the exchange’s income from securities trading.

Despite a fall in turnover-linked income, the BSE saw its net profit rise 18% to Rs 212 crore, thanks to a rise in income from investment and deposits — from Rs 175 crore in 2007-08 to Rs 222 crore last fiscal.

Last year’s stock market turmoil caused a significant fall in trading volumes on bourses, with the BSE recording a 30% decline in turnover to Rs 11 lakh crore in 2008-09 compared with Rs 15.8 lakh crore in 2007-08.

The BSE recorded a 30% drop in transaction charges to Rs 77 crore, while income from other charges amounted to Rs 40 crore compared with Rs 48 crore in the previous year. A higher net profit has boosted BSE’s net worth from Rs 1,559 crore to Rs 1,728 crore.

-- an article by ET dt:14th July 2009

(Also read a post on BSE dated: Nov 13 2008 & Nov 20 2008)

INDIA GDP GROWTH : A PREDICTION

Predictions about India GDP growth
Allianz, a major financial and insurance services provider has estimated that in 2009-10 fiscal gross domestic product of India would be growing at 6.5 percent. It says that even though economic recession has hit almost every financial market in world, emerging Asian economies like India would be growing, all be it at a slow pace.

Allianz says that growth of gross domestic product of India would be decidedly slow at first two quarters of financial year 2009-10 but would pick up in last two quarters. They have expressed that since there are sufficient and efficient capital and foreign exchange controls in place in India, it would be able to tide past difficulties like capital movements that can be extremely volatile.

Economic surveys conducted in India during February of 2008 fiscal had reported that gross domestic product of India would be growing at a rate of 8.7 percent. This was supposed to follow up impressive statistics of 2006-07 fiscal, when rate of growth of gross domestic product was 8.7 percent.

Much of this optimism was based on increase of rates of savings and investments in domestic financial circuit. It was predicted that aggregate gross domestic product of India in 2007-08 financial year would be approximately $10,00,82,03,62,968.85. It was expected that this growth would enable Indian economy to grow to one trillion dollar mark in near future.

In terms of nominal exchange rate, gross domestic product of India was supposed to be $1.16 trillion dollars in 2007-08 financial year. Per capita income in terms of nominal exchange rate was around $1,021.

Actual situation of India GDP growth
Actual picture is pretty different from what has been predicted. It is being assumed that in present scenario of economic recession, growth rate of India GDP would slip, if India's national government does not introduce economic stimulus packages.