A LITTLE STORY ON MARKETS (On Request)

There was a small village, everyone there were living happily, one day someone from the big city came with his assistant, he announced that - "I will give Rs. 10 each for every monkey you catch and bring it to me", now the villagers started catching monkeys, soon villagers found a new job. They caught monkeys and sold to that stranger & made good money, after a short while villagers lost their interest. The stranger again announced that - "I will give you Rs. 15 each for every monkey", more monkeys came in, after a while the price of monkey went up to Rs. 60 !!! Suddenly one day the stranger was out of the village & his assistant said - "Look this guy does not pays me much, I want to sell all his monkeys at Rs. 50 each so when he comes back you can sell it back to him for Rs. 70" - the villagers agreed -The assistant sold all the monkeys to the villagers for Rs. 50 and went out of the village. Villagers were now left with their monkeys & still waiting........for the Stranger and his assistant to come... but none of this two came back & left villagers with their monkeys worth nothing...while that strangers made money out of nothing....

THE MORALE OF THE STORY - 

The villagers are we small Investors , our stocks are the monkeys and FII’s (Foreign Institutional Investors) are those strangers !!!

Do learn the lesson from this game.. and Invest safely, invest in good business and for long term... 


REGARDS

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PRAJ INDUSTRIES : In a Trading Range, But with bullish signs

Praj Industries has been finding exact support at the upward sloping trendline joining the significant bottoms. The upmove from Rs.70 to Rs.100.85 was retraced by about 61.8% to around Rs.81 after which the stock started moving up.

The downmove from Rs.100.85 to Rs.81 took 13 trading days (Fibonacci time period) which was completely retraced only in 5 trading sessions (again a Fibonacci time period). This is called “Faster Retracement” and is a bullish indication.

The downward sloping trendline joining the significant tops has been breached by the stock in the last week and the close has been significantly higher than this trendline. The stock has been consistently making higher bottoms, which is once again bullish for the stock. The volumes have increased in the last few trading sessions indicating participants increased interest in the stock.

Also there will be news soon about the company completing its process of divesting its US-based subsidiary, Praj Schneider due to economic scenario in US.

The mid-cap engineering firm has an equity capital of Rs 36.94 crore. Face value per share is Rs 2.

The current price of Rs 87.70 discounts the company's Q3 December 2009 annualised EPS of Rs 6.31, by a PE multiple of 13.89.

The company has retained rights for process technology for bio-diesel in North America. Meanwhile, the company has launched a new company in US, Praj Americas Inc, operating out of Houston, to address the markets in North, Central and South America.

Praj Industries offers innovative solutions to significantly add value in bio-ethanol, bio-diesel and brewery plants and related wastewater treatment systems for customers, worldwide.

GRASIM SAMRUDDHI DEMERGER: A COMPLICATION, A CONFUSION.

Grasim has declared the demerger of Samruddhi cements, its ratios and demerger process has become some what complicated and confusing for any common shareholder, here I have tried to elaborate some of its key points –

The demerger scheme says every shareholder of Grasim will get 1 share of Samruddhi. Now, Samruddhi has 26 cr shares, with the Face Value of Rs.5.00, Book Value of Rs.250. Grasim will transfer Rs.2100 cr of debts to Samruddhi.

Grasim will hold 65% in Samruddhi & 35% of Grasim shareholders will hold 35% in Samruddhi.

Samruddhi will be listed in stock exchanges hence, providing exit option to its shareholders, further it will be merged with Ultra Tech Cement.

The record date for this merger has been set as 1st October 2009,

So, a share holder of Grasim will get 1 Samruddhi for every 1 Grasim held,

And he will get 4 Ultra Tech Cement shares for every 7 Samruddhi he holds as on record date declared by Ultra Tech Cements. So the price of Samruddhi will depend on the last closing price of Ultra Tech Cements.

On 10th March 2010, A block deal of 100000 shares of ULTRA TECH CEMENTS at Rs.1103/share was done.