Networth - ICICI Bank FPO
Monday, June 18, 2007
BEML, Uptrend, BUY, Support @ 1062-1000, Resistance @ 1160-1196
Glaxo, Uptrend, BUY, Support @ 1282-1253, Resistance @ 1334-1356
L&T, Uptrend, BUY, Support @ 1885-1823, Resistance @ 1988-2028
Apar Industries, Uptrend, BUY, Support @ 157-153, Resistance @ 167-172
PSL, Uptrend, BUY, Support @ 242-228 Resistance @ 270-284
Finolex Cables, Uptrend BUY, Support @ 89-86, Resistance @ 94-95
Market opened with significant gap up on the back of strong cues from Asian markets. After the morning session market turned to be bit lacklustre and ranged. There seems to be liquidity outflow from the system given the major IPO from ICICI Bank. However indices could hold on the gains and slipped into red during mid session. This sell off was led by selling in IT, Pharma, Auto and Consumer durable stocks. However, Banking, Cap goods and Oil & Gas indices managed to hold gains. Midcaps could not sustain and closed flat while the smallcap ended in red. Most of the Asia markets ended in green except Europe.
Sensex traded down by 83 points at 14080.14. Weighing on the Sensex were losses in Ranbaxy (359.25,-4 percent), Hero Honda (653.7,-4 percent), TISCO (588.95,-2 percent), HDFC Bk (1087.9,-2 percent) and TCS (1166.6,-2 percent). Losses were restricted by gains in ICICI Bk (917.85,+1 percent), ONGC (889.5,+1 percent), Hindalco (162.1,+0 percent), ACC (823.6,+0 percent) and ITC (152.9,+0 percent)
Software counter was mixed. Market reported that Cranes Software (Software products maker) is close to buy out the Bangalore-based anti-virus software maker Proland Software. The proprietary firm Proland Software has been in the business of designing, developing and supporting anti-virus software products for over 15 years. Proland has anti-virus offerings on almost every platform, namely Windows Vista, Windows XP, Windows 98, Windows 2000 and NetWare among others. Sold under the Protector Plus brand, Proland's anti-virus software products have users in over 100 countries. Proland derives about 65% of its revenues form the US market, while Europe was its second largest market. The stock runs up on the news which is inline with the business. Cranes Software ended up by 4.5% while its pears like Hexaware Technologies was up 2%.
It was a good listing day for Plastic packaging maker Glory Polyfilms which started the day at its issue price of Rs 48 and touched a high of Rs 84 in the trade. Strong support from buyers helped the stock to hold above Rs 60 till the end despite sluggish markets in the late mid trade. Glory Polyfilms expect FY09 topline at Rs 150 crore. They also expect operating profit margin and net profit margin at 20-22% and 10%, respectively. The company entered capital markets with around Rs40crs. The issue will be used to part finance the expansion of multlayer film, printing capacity and lamination film. Money will also be used for meeting the working capital margin requirements. The stock ended the day down by 2.5% on account of heavy selling pressure.
Technically Speaking: Market drifted to lower levels as selling pressure eroded the gains. Sensex touched intraday high of 14283 and days low of 14057. Resistance lies at 14360 levels and Support lies at 13860 levels. Overall breadth was in favor of Decliners, where the Declines were 1323 against 1237 Advancers. Market is expected to be ranged for the week.
Indian shares reversed early gains to end down 0.58 percent on Monday, led by losses in technology firms such as Infosys Technologies Ltd. on concerns a strong rupee would hurt earnings.
Shares in top private lender ICICI Bank Ltd. rose 1.1 percent to 917.85 rupees, having risen as much as 1.9 percent during trade, on hopes of successful sale of up to $4.9 billion of shares in India and the United States this week.
"We are seeing persistent selling at the higher levels in the recent sessions. The market is too volatile and the trend is likely to continue till the beginning of the corporate earnings season," said Neeraj Deewan, director at Quantum Securities.
The benchmark 30-issue BSE index fell 82.57 points to end at 14,080.14 with 23 components losing. The index is 4.4 percent below its all-time high of 14,723.88 hit on Feb. 9.
The 50-issue Nifty was down 0.58 percent at 4,147.10. It hit an all-time high of 4,362.95 on June 4.
The Indian leg of ICICI Bank's share sale opens on Tuesday, with an indicative price band of 885-950 rupees per share. Last week, property developer DLF Ltd. raised $2.25 billion in India's biggest initial public offering.
Deewan said ICICI Bank's share sale, the country's largest ever, had put pressure on the broader market as interested investors diverted cash away from other shares.
Some gains in the rupee at the start of the week hurt export-focused software services firms on concerns about their profit in the quarter ending June 30. Indian software firms earn about 60 percent of their revenue from the United States.
The rupee rose to 40.760/770 per dollar on Monday afternoon, up from 40.86/87 on Friday. The rupee, which hit a nine-year high of 40.28 in late May, has gained about 8.5 percent against the dollar this year.
Second-ranked Infosys Technologies fell 1 percent to 1,988.90 rupees and top exporter Tata Consultancy Services Ltd. ended 1.5 percent lower at 1,166.60 rupees.
In the broader market, losers outpaced gainers 1,438 to 1,112 on total volume of 218 million shares.
For a technical analysis by Reuters, please see: www.reutersindia.net.
Elsewhere in the region, Karachi's 100-share index gained 0.96 percent to 13,567.40 points, while Colombo's All-Share index fell 0.33 percent to 2,594.50 points.
STOCKS THAT MOVED
* Pig-iron supplier Visa Steel Ltd. rose nearly 5 percent to 34.45 rupees after a top official said China's Baoshan Iron and Steel Co. Ltd. (BaoSteel) had approached the company for a possible tie-up.
* Sparsh BPO Services Ltd. slipped 1.8 percent to 204 rupees after U.S.-based Blackstone Group offered to buy an additional 20 percent in the company at 200 rupees a share. Parent Intelenet, being acquired by Blackstone for an undisclosed sum, holds 51 percent in the firm.
* Geodesic Information Systems Ltd. ended 10 percent up at 274.50 rupees after the software firm's board approved issuing one bonus share for every two shares held and raising $150 million overseas.
* Cranes Software International Ltd. rose 4.3 percent to 132.90 rupees after the software products maker said it would spend 700 million rupees to acquire U.S.-based Dunn Solutions Group and Tilak Autotech Pvt Ltd.
TOP 3 BY VOLUME
* IKF Technologies Ltd. on 18.9 million shares
* Glory Polyfilms Ltd. on 15.7 million shares
* IFCI Ltd. on 15.5 million shares
UTI Asset Management Company will float an initial public offer by March-end next year to help its sponsors, SBI, LIC, PNB and BoB, offload up to 50%.
UTI Asset Management Company Ltd chairman and managing director U K Sinha told PTI that the board of the company had recently approved the proposal to offload up to 50% stake held by the four sponsors.
State Bank of India (SBI), Life Insurance Corporation of India (LIC), Punjab National Bank (PNB) and Bank of Baroda (BoB), individually hold 25% stake each in the asset management firm.
Sinha said UTI AMC would probably be the first domestic mutual fund in the country to go for an IPO, through which the four sponsors would make a partial exit.
He said the details on the valuation of the company were being worked out.
The valuation of the firm was last done in November 2005, when the four sponsors bought stake in it.
Cluster: Ugly Duckling
Price target: Rs484
Current market price: Rs342
Zen(sar) and the art of growing
- Strengthening its portfolio of service offerings: Zensar Technologies (Zensar) has effectively utilised the inorganic route to gain the required critical mass in the fast growing enterprise solutions segment (through the acquisition of OBT Global and ThoughtDigital), to strengthen its footprint in under-penetrated geographies such as Japan (through joint venture with Eza, Japan), and to gain access to marquee clients.
- Maintaining the growth momentum: Zensar is well poised to report a healthy growth of over 40% in FY2008. It is witnessing a strong traction in its organic business and the incremental revenues of Rs110 crore from the recent inorganic initiatives would only add to the overall growth momentum in its revenues. Consequently, even after factoring in the adverse impact of the rupee appreciation, the company is expected to achieve its stated revenue guidance of Rs850 crore in FY2008.
- Margins are sustainable: Zensar is also expected to buck the general declining trend in margins in FY2008. That's because some of its relatively new businesses of ITS and BPO that have been in the investment mode are expected to show a substantial improvement in their margins. It also has other margin levers like a favourable revenue mix and lower overhead costs to cushion against the adverse impact of wage hikes, the appreciation in the rupee and the consolidation of the relatively lower-margin revenues of ThoughtDigital.
- Key concern of stake sale by Fujitsu has been dispelled: The acquisition of the entire stake of Fujitsu in Zensar by the RPG group has eliminated a key concern that was a drag on the stock's valuations.
- Attractive valuations: At the current market price the stock trades at 10.6x FY2008 and 8.2x FY2009 estimated earnings; the valuations are extremely attractive considering the estimated earnings growth of 33% CAGR over FY2007-09. We recommend Buy on the stock with a price target of Rs484.
Buy IOL Broadband with stop loss of Rs 440 for a target of Rs 535.
Buy Chola DBS with stop loss of Rs 146 for a target of Rs 190.
Buy United Spirits with stop loss of Rs 1100(On closing basis) for a short-term target of Rs 1320.
Buy Federal Bank with stop loss of Rs 277(On closing basis) for a short-term target of Rs 301.
Despite Asian indices hitting new highs, the market seemed to have lost its steam after opening strong in the morning. The Sensex opened with a positive gap of 79 points at 14242 and touched the day's high of 14284 within a few minutes of trading on brisk buying in heavyweights. However, it shed its early gains on account of heavy selling in IT, pharma, auto and consumer durable stocks, and entered the negative territory by the afternoon. The Sensex swung between negative and positive thereafter, as investors turned cautious in view of the circular of the Central Board of Direct Taxes. The Sensex tumbled below the 14100 mark towards the close to touch the intra-day low of 14057 amid relentless selling pressure. The Sensex finally closed with losses of 83 points at 14080. The Nifty closed at 4147, down 24 points.
The market breadth was weak as the losers outpaced the gainers in a ratio of 1.27:1. Of the 2,597 stocks traded on the BSE, 1,413stocks declined, 1,123 stocks advanced and 61 stocks ended unchanged. Select sectoral indices slipped sharply. The BSE IT index dropped 1.10% followed by the BSE CD index (down 1.07%), the BSE Teck index (down 0.84%) and the BSE Auto index (down 0.77%).
Most of the index heavyweights witnessed correction. Among the Sensex majors Ranbaxy tumbled by 3.89% at Rs359, Hero Honda dropped 3.87% at Rs654, Tata Steel lost 1.86% at Rs489, HDFC Bank slumped by 1.66% at Rs1,090, TCS slipped by 1.51% at Rs1,167, Wipro shed 1.44% at Rs523, HDFC lost 1.43% at Rs1,759, Bajaj Auto fell by 1.42% at Rs2,079, Satyam crumbled by 1.23% at Rs477 and L&T dipped 1.06% at Rs1,927. The other front-line stocks lost around 1% each. However, select counters saw some buying action and ended with gains. ICICI Bank advanced by 1.08% at Rs918 while ONGC, Hindalco, ACC, ITC, Maruti Udyog and HLL ended with modest gains.
IT stocks were hit hard and dropped sharply. Geometric Software crumbled by 8.92% at Rs111, Info Edge lost 3.88% at Rs786, Igate Global shed 3.62% at Rs321, Mphasis declined by 3.05% at Rs307 and CMC was down 3.01% at Rs1,155.
Over 1.89 crore IKF Technologies shares changed hands on the BSE followed by Glory Polyfilms (1.56 crore shares), IFCI (1.54 crore shares), Reliance Natural Resources (76.88 lakh shares) and GV Films (57.36 lakh shares).
Time Technologies was the most actively traded counter on the BSE and registered a turnover of Rs217 crore followed by Nestle (Rs122 crore), Reliance Industries (Rs103 crore), Divi's Lab (Rs98 crore) and Glory Polyfilms (Rs96 crore).
The market witnessed high volatility, moving between positive and negative zones during the day. A late sell-off emerged, similar to the trend witnessed on Friday, 15 June 2007.
Market men said the latest circular issued by the Central Board of Direct Taxes (CBDT) on Friday, 15 June 2007, failed to provide the much-needed clarity with regard to tax on profit/gain arising from sale of shares. CBDT issued the circular after trading hours on Friday, 15 June 2007. The domestic bourses bucked cues from strong global markets for the second straight day.
Selling was seen across the sectors, with shares from auto and IT pivotals leading the fall, while buying was witnessed in select index heavyweights. Some buying was seen in banking and FMCG stocks.
All the Asian shares gained today as the yen's continued weakness against the US dollar lifted shares of exporters such as Toyota Motor Corp. and Canon Inc. Hong Kong's Hang Seng gained 2.69% to 21,582.89 while Japan's Nikkei surged 0.99% to 18,149.52 .
Singapore's Straits Times (up 1.19% to 3,623.79) and South Korea's Seoul Composite (up 1.95% to 1,806.88) also edged higher.
European markets were trading on a mixed note.
The 30-share BSE Sensex lost 82.57 points or 0.58% at 14,080.14. The Sensex had opened higher at 14,241.76 and advanced to a high of 14,283.71 shortly. But it was not able to sustain at higher levels. Fresh sell-off in late-afternoon session pulled it to a low of 14,057.26 at 15:07 IST.
The S&P CNX Nifty declined 24.35 points or 0.58% at 4147.10. The Nifty June 2007 futures settled at 4,134, a discount of 13.10 points compared to the spot closing.
The total turnover on BSE amounted to Rs 3774.26 crore while the NSE F&O turnover was at Rs 30785.27 crore. The turnover was muted, indicating that the action might have shifted to primary market. The Rs 8750-crore follow-on public offer by ICICI Bank opens for subscription on Tuesday, 19 June 2007.
The market breadth turned negative on BSE in late trade, after staying positive throughout the day’s trading session, as small and mid-cap stocks succumbed to selling pressure: 1,323 shares declined as compared with 1,237 that advanced, while 68 remained unchanged.
The BSE Small-Cap index declined 0.46% to 7,316.68 while the BSE Mid-Cap Index slipped 0.13% to 6,172.87.
Among the Sensex pack, there were 22 losers, while the rest were gainers.
Bike maker Hero Honda Motors was the top loser among the Sensex constituents, down 3.82% to Rs 654, on volume of 92,982 shares. The stock saw fresh selling after Macquarie Research recommended an underperformer rating on the stock with a 12 -month target price of Rs 608.
The Hero Honda Motor stock has been declining steadily ever since reports that it has cut production following reduced demand as interest rates surged to five-year-high. From a recent high of Rs 732.35 on 31 May 2007, the stock lost 7.10% to Rs 680 by 15 June 2007.
Other auto stocks were not spared either. Bajaj Auto (down 1.57% to Rs 2076), Tata Motors (down 0.60% to Rs 646.50) also declined. The BSE Auto Index settled with loss of 0.90% to 4,633.97.
Ranbaxy (down 3.81% to Rs 359.55), HDFC Bank (down 2.01% to Rs 1086), and Tata Steel (down 2% to Rs 588) were the other losers.
IT stocks declined on renewed selling following rupee's appreciation against the US currency. The BSE IT Index lost 1.11% to 4,940.61, and was the top loser among the sectoral indices on BSE.
Satyam Computers (down 1.11% to Rs 477.65), Infosys (down 1.16% to Rs 1986), Wipro (down 1.58% to Rs 522), and TCS (down 1.30% to Rs 1169.15) edged lower.
The rupee resumed higher at 40.75/76 a dollar from Friday's (15 June 22007) close of 40.85/86 per dollar and later edged up to 40.74/7450 a dollar in the late morning deals.
Hindalco Industries advanced 1.61% to Rs 163.90, and was the top gainer among the Sensex pack. The Aditya Birla group’s aluminium and copper major has proposed to set up a new extrusion press at an investment of Rs 50 crore.
The BSE Bankex was rose 0.24% at 7,453.52, and was the top gainer from sectoral indices on BSE.
ICICI Bank advanced 1.21% to Rs 919 on 1.78 lakh shares, and was the top gainer among the Sensex pack. Before trading hours today, 18 June 2007, ICICI Bank set price band for its follow-on public issue. The price band for the issue has been fixed at Rs 885 to Rs 950 per equity share. The stock had closed at Rs 908 on BSE on Friday, 15 June 2007.
Retail bidders would be allotted shares at a discount of Rs 50 per share to the issue price determined by the book-building process. The public issue opens for subscription on Tuesday, 19 June 2007. The issue size is Rs 8,750 crore. In addition, there is a green shoe option under which the Bank may allocate additional equity shares up to Rs 1,312.5 crore. The issue including the green shoe option aggregate to Rs 10,062.5 crore.
Union Bank of India (up 3.53% to Rs 124.55), UTI Bank (up 2.24% to Rs 610), and Vijaya Bank (up 0.91% to Rs 49.70), were the noteable gainers from the banking pack.
State run oil exploration major Oil and Natural Gas Corporation (ONGC) advanced 0.31% to Rs 885.80. ONGC’s overseas exploration unit, ONGC Videsh (OVL), last week, received Cabinet approval to buy a 33% stake in a deep-water gas field in Egypt from Royal Dutch Shell Plc.
Index heavyweight Reliance Industries (RIL) was down 0.42% to Rs 1672.90 on 6.09 lakh shares. As per reports, global oil giants including Shell, Exxon and Chevron are eyeing a stake in Reliance Industries’ overseas oil & gas assets. RIL recently hived off these assets into a separate company called Reliance Exploration and Production DMCC.
The BSE FMCG Index closed 0.02% higher at 1,789.09 as ITC (up 0.85% to Rs 153.30) and Hindustan Unilever (up 0.65% to Rs 188.25) gained.
State-run engineering major Bhel was down 0.35% to Rs 1385. As per reports, Bhel has won a Rs 139 crore order to supply 27 transformers to NTPC. Bhel would deliver the equipments within 25 months. NTPC will use the transformers for its Korba, Dadri and Farakka extension projects.
IKF Technologies tops volume charts on BSE On BSE, 1.89 crore shares were traded in IKF Technologies counter It was the top traded scrip on BSE, in terms of volume of shares. The share price dipped 5% to Rs 9.13.
Debutant Glory Polyfilms clocked the second highest volume of 1.56 crore shares on BSE. The share price closed at 28.85% premium at Rs 61.85 on BSE over IPO price of Rs 48. The Glory Polyfilms stock made its debut at Rs 50. The scrip touched a high of Rs 84 and a low of Rs 50 during the day. The scrip is placed in the B1 group of securities on BSE.
Time Technoplast topped the turnover chart with total turnover of Rs 217 crore followed by Nestle India (Rs 123 crore), Reliance Industries (Rs 103 crore), Divi's Labs (Rs 98 crore) and debutant Gory Polyfilms (Rs 96.75 crore).
Suven Life Sciences soared 6.26% to Rs 45 on volumes of 31.36 lakh shares after a block deal of 30 lakh shares at Rs 41.75 per share on BSE by 15:18 IST on BSE.
3M India fell 1.10% to Rs 1725 after the company said its Indian promoters sold 6.2% of their stake in the company in the open market between 7 May 2007 - 1 June 2007. Consequently, the Indian promoters hold 1% in the company and are no longer termed as promoters of 3M India. United States-based Minnesota Mining and Manufacturing Company holds 76% stake in the company.
Rajesh Exports dipped 2.6% to Rs 518.50 even as its net profit jumped 123.09% in Q4 March 2007 to Rs 33.33 crore as against Rs 14.94 crore in Q4 March 2006. Sales inched up 0.75% to Rs 1796.52 crore in Q4 March 2007 as against Rs 1783.07 crore in Q4 March 2006.
Geodesic Information Systems soared 10% to Rs 274.50 after reporting jump in net profit to Rs 29.68 crore in Q4 March 2007 as against Rs 12.74 crore in Q4 March 2006. Sales jumped 64.68% to Rs 48.12 crore in Q4 March 2007 (Rs 29.22 crore). Along with the Q4 March 2007 and FY 2007 results announced during trading hours today, 18 June 2007, the company's board also declared a 1:2 bonus issue.
Cadila Healthcare advanced 5.30% to Rs 365.15 after its board approved raising up to $100 million by issuing foreign currency convertible bonds (FCCBs)/ American depository receipts (ADRs)/global depository receipts (GDRs) or such other foreign currency instrument with a green shoe option.
Madhucon Projects surged 7.58% at Rs 215.05 after a block deal of 1.5 lakh shares was executed in the counter at Rs 208.50 per share at 10:26 IST.
Cranes Software International vaulted 5.14% at Rs 133.95 after it approved the acquisition of equity shares of Dunn Solutions Group, (DSG), technology based consultancy company in the US though its wholly owned subsidiary in the US, Cranes Software Inc., for about Rs 60 crore. It will also acquire another firm Tilak Autotech for Rs 10 crore thereby making it a wholly owned subsidiary of the company.
Ashapura Minechem rose 0.71% to Rs 341 on reports that BHP Billiton, the world’s largest mining company, is entering into a joint venture with the mineral producer and exporter. Reports suggest that the Australian giant will pick up 51% in Ashapura Minechem’s Rs 2,500-crore alumina refining project in Orissa. Ashapura will hold the remaining 49%.
Wall Street advanced again on Friday, 15 June 2007, after the week's most anticipated economic reading indicated that inflation excluding the price of gas remained tepid last month, easing some concerns that have jolted stock and bond markets in recent sessions. The Dow jumped 85.76 points, or 0.63%, to 13,639.48. The Nasdaq Composite index, still well off its record levels reached during the dot-com boom, rose 27.30, or 1.05%, to 2,626.71.
Crude oil was little changed in New York after rising to a nine-month high on concern US gasoline supplies are inadequate to meet peak summer demand. Crude oil for July 2007 delivery was at $68.10 a barrel, up 10 cents, in after-hours electronic trading on the New York Mercantile Exchange today, 18 June 2007.
Market Grape Wine :
In House :
Nifty at a support of 4100 and 4150 levels with resistance at 4210 and
4240 levels .
Sell : Intraday : ACC below 817 target of 801 with SL of 825
Buy: Intraday : UNIPHOS above 317.50 target of 326 with SL 313
Buy: Positional: Balkrishna Industries above 525 target 650 and 850.
Buy: Positional : Vivimed labs around 150 to 155 target 270
Out House :
Markets at a support of 14014 & 13959 levels with resistance at 14276
& 14324 levels .
Buy : RIL
Buy : I-Flex & INFY
Buy : Praj at dips
Buy : IBulls & Unitech
Buy : GujNre at dips
Buy : LUPIN & Auropharma
Buy : Centextile & SesaGoa
Buy : AsianElec & SKumar
Dark Horse : SesaGoa , Prajind , CenTextile , Auropharma , IBulls & Unitech
Bullet : Bhel & Divis with strict stop loss .
Avoid the trap
"I don't want the cheese, I just want to get out of the trap"
This morning appears to be more of a trap for the bulls. Signs from the global markets are pointing towards a higher opening. However, the uncertainty over the latest CBDT circular on the tax treatment of stock trading may hurt sentiment. The circular says that profits from the sale of shares, which till now was being treated as business income or capital gains, will be taken on a case by case basis. This may lead to some confusion and trepidation, especially for FIIs as they are the most significant player in the market.
The public issues of DLF and the ICICI Bank may mean more offloading in the secondary market. Among the other worries is that oil prices in New York has crossed the $68 per barrel mark and there has been some talk of hike in local fuel prices as well. A further spike in oil prices will not auger well for the markets. Liquidity flows, particularly from the FIIs, have also turned volatile this month after being strong in the last two months.
In the week ended June 14, India Equity Funds recorded net outflows of $367mn, extending their losing streak to eight straight weeks, says global funds flow tracking firm EPFR Global. It was the second-worst week for these funds and took year-to-date outflows to $1.67bn. None of the major fund groups tracked posted positive performance during the week and a majority saw money pulled out by nervous investors.
We strongly advocate caution at this juncture, as the bulls are clueless about the near-term direction. There are a few uncertainties like interest rate movement across global markets, the rise in the bond yields in the US, higher oil prices and volatile global capital flows. Avoid fresh purchases in a big way for the short to medium term unless you have something stock specific. Lock in gains at every rally for better opportunities in the near future. We see a higher opening on the back of firm global markets. However, things will turn choppy as the day wears on.
FIIs were net sellers to the tune of Rs447.8mn (provisional) in the cash segment on Friday. On the other hand, local institutions pumped in Rs3.64bn on the same day. In the F&O segment, foreign funds were net buyers of Rs888.2mn.
One should keep an eye on Reliance Capital. The stock has risen sharply in the last few days and may have some more steam left for further appreciation. IFCI may do well as the troubled public sector term lender looks to close the deal for selling up to 26% stake to strategic investor(s). Idea Cellular may be in the thick of things amid reports that the merger talks with Spice Telecom have fallen through on the issue of valuation.
Zicom might gain as it is likely to tie up with the future Group (Pantaloon Retail). The company will also declare its results today. Ashapura Minechem is likely to advance amid reports that it is going to form a joint venture with mining major BHP Billiton. The company will also announce a bonus on June 27. ICICI Bank will attract a lot of attention as its follow-on public offering kicks off tomorrow. The bank has set a price band of Rs885-950 per share.
Retail firms like Pantaloon Retail and Shoppers' Stop could take a hit amid reports that the government may restrict the expansion of big organised retailers to cushion the impact on the so-called mom-and-pop stores. Sparsh BPO may see some action amid expectations that Blackstone and the management of Intelenet may announce an open offer after the former bought out the stake of HDFC and Barclays in Intelenet.
Equity shares of Glory Polyfilms will get listed in the bourses today. The issue was priced at Rs48 per share. The premium being bandied about on the street is just Rs1-2.
UK and German stocks rose to multi-year highs on Friday. The UK's FTSE 100 closed 1.2% higher at 6,732.40, hitting a high not seen since September 2000, while the German DAX Xetra 30 advanced 2.3% to 8,030.64, a level not seen since March 2000. The French CAC-40 rose 1% to 6,105.28, and the pan-European Dow Jones Stoxx 600 index rose 1.3% at 399.26.
In the emerging markets, the Ibovespa in Brazil was up 1.5% at 54,518 while the IPC index in Mexico closed flat at 32,128 and the RTS index in Russia added 0.7% to 1883.
Asian stocks rose for a third day, led by exporters, after the yen weakened and reports showed that inflation is slowing in the US. Samsung and Toyota led technology companies and automakers higher. BHP Billiton climbed to a third straight record after metals prices advanced.
The Morgan Stanley Capital International Asia-Pacific Index added 1% to 153.16 as of 11:55 a.m. in Tokyo, extending a two-day 1.4% rally. Five of the region's benchmarks jumped to records, with China's CSI 300 Index adding 3.2%.
Japan's Nikkei 225 Stock Average climbed 1%, while Hong Kong, South Korea, Singapore and the Philippines set new highs. Taiwan's market is closed for a holiday.
US stocks gained on Friday, helping the Standard & Poor's 500 Index to its biggest weekly advance since April. The core consumer prices, which exclude food and energy, rose 0.1% last month after increasing 0.2% in April, reducing the chance that interest rates will be hiked to tame inflation in the region's No. 1 export market.
Sluggishness likely to continue
Markets ended on a flat note following its trend of losing ground in the last hour of the trading session. Thursday's impressive rally was carried forward in the early trades of Friday led by gains in the index heavy weights like BHEL, ACC, L&T and Hindalco. However, bulls faced stiff resistance at higher levels as key indices Technology, Oil & Gas and Metal stocks dragged the markets to close almost from where they started. Finally, the 30-share Sensex slipped 41 points to close at 14162. NSE-50 Nifty was flat and ended at 4171.
In a high volatile week, the BSE 30-share Sensex ended with 52 points or 0.37% to close at 14162 and NSE Nifty added 16 points or 0.38% to close at 4171.
Elecon Engineering surged by 3% to Rs509 after the Board of Directors f the company announced that they would meet today consider and approve a proposal for declaration of bonus shares. The scrip touched intra-day high of Rs527 and a low of Rs490 and recorded volumes of over 2,00,000 shares on NSE.
Nicholas Piramal slipped 2% to Rs300. Reports stated that it might hive off its R&D business and sell stake to private equity players. The scrip touched intra-day high of Rs314 and a low of Rs299 and recorded volumes of over 3,00,000 shares on NSE.
Hind Rectifiers plunged by 10% to Rs911. The company announced a dividend of 100% and also proposed a stock split from Rs10 per share to Rs2. The scrip touched intra-day high of Rs1001 and a low of Rs911.05 and recorded volumes of over 1,00,000 shares on NSE.
ANG Auto spurred by 3.8% to Rs314 after the company approved the plan to set up a wholly owned subsidiary in Hong Kong / Singapore. The scrip touched intra-day high of Rs318 and a low of Rs299 and recorded volumes of over 1,00,000 shares on NSE.
Banking stocks recorded smart gains in a volatile trading session. Index heavy weight SBI advanced by 0.8% to Rs1323, HDFC Bank was up by 1% to Rs1108 and ICICI Bank added 0.5% to Rs908. However, Union Bank, Corp Bank and OBC were the major gainers among the Mid-Cap stocks.
Capital God stocks were on the move held on to its gains in yet another volatile session. BHEL surged by over 3% to Rs1389, ABB advanced by 1% to Rs4522 and L&T gained by 1.5% to Rs1947. However, Punj Lloyd lost 1.6% to Rs239.
IT stocks were on the receiving end. Index heavy weight Infosys slipped 0.6% to Rs2009; Satyam Computer was down by 1.5% to Rs483 and Wipro edged lower by 0.4% to Rs530.Select metal stocks also list its shine after being in the limelight in the previous trading session. Frontline stock Tata Steel slipped by 2.3% to Rs600, Hindalco was down by 1.6% to Rs161. However, Hindustan Zinc was up by 4% to Rs672 and Sterlite Industries edged higher by 0.5% to Rs542.
After a slow start for the week, US stocks picked up momentum during the last three trading days for the week ended Friday, 15 June, 2007. Tame inflation figures and moderate economic growth portrayed by Fed’s Beige Book lifted stocks and the three day rally between 13June and 15 June, 2007 was the best rally for the market since 19-21 March, 2007.
Rising bond yields initially checked US market’s momentum on Monday and Tuesday. On Tuesday, the 10 year Treasury notes hit a all time high of 5.3% after crossing the psychological 5% mark for the first time last week. At the end of the week, it closed at 5.152%. Former Federal Reserve Chairman, Alan Greenspan, mentioning that the market might be limited for US securities also had a negative impact on stocks.
But once bond yields stabilized as the PPI and CPI report checked in better than expected, there was no looking back for the stocks. The Dow Jones Industrial Average added 215 points in its kitty for the week. Tech heavy Nasdaq gained 53 points while S&P 500 too gained 26 points.
On the economic news front, Commerce Department's May retail sales report came in better than expected. Fed's Beige Book report showed the U.S. economy continued to expand at a moderate pace in the first part of the second quarter and inflation remained under control.
Stocks continued their rally on Thursday following more good news on the inflation front. Total PPI rose a larger than expected 0.9% in May boosted by a big 4.1% increase in energy costs. But the core rate (excluding food and energy) rose 0.2%. That was in line with expectations and continued the benign trend from the previous month.
On Friday, Labor Department showed that total CPI rose 0.7% in May, marking the second largest monthly increase in 16 years. The core rate, which excludes the 5.5% spike in energy prices, increased by just 0.1% (consensus 0.2%).
On the earnings front, Lehman Brothers kicked off earlier this week handily beating estimates. Goldman Sachs too handily beat analysts' expectations, but investors were disappointed with the paltry 1% y-o-y rise in Q2 profits. Bear Stearns missed expectations.
During the week, the acquisitions news that hit the headlines were – Penn National Gaming confirmed it will be taken private for $8.6 bln. There was also some speculation that Nymex is exploring a possible sale. Also, Financial Times parent Pearson is supposed to be seeking partners for a possible bid for Dow Jones provided some spice to investors.
For the week, DJIx is up by 1.6%, S&P 500 is up by 1.7% and Nasdaq is up by 2.1%. Last week’s sell-off was contained this week as bond yields stabilized after reaching an all time high on last Tuesday. Upbeat economic reports, mainly Thursday and Friday’s inflation reports gave a major boost to stocks. For the year, the Dow is up by 9.4%, Nasdaq is up by 8.8% and S&P 500 is up by 8.1%.
During the week, the inflation data put a check on rising bond yields and the yield on the 10-year note fell and closed at 5.152%. Stocks rallied in spite of crude crossing $68/bbl and gaining 5% for the week.
Trading volume on Friday, 15 Jun 2007, was heavier than usual, which was a function of the increased trading that took place with the expiration of stock options, index options, index futures and single stock futures.
|A visitor to DLF Chairman Kushal Pal Singh’s office on the 9th floor of the company’s Parliament Street building in the capital gets a glimpse of some rare maps, among the earliest ever drawn, of “Hindoostan” or the “East Indies”, depending on whether the cartographer was Portuguese or British.|
|Singh’s desk is also littered with old navigation equipment and in the backdrop is a flag of the tiny, yet super-rich principality of Monaco, of which he is consul general.|
|Flush with the success of having overseen the country’s largest-ever public issue (over Rs 9,000 crore), the 75-year-old builder of modern Gurgaon tells Nayantara Rai and Siddharth Zarabi that he isn’t tired at the end of it all. “It’s all a part of the game. After all, it is the beginning for DLF.” Excerpts from the interview:|
|So, are you pleasantly surprised with the response?|
|It would be unfair for me to say I never expected it. I expected it to be subscribed fully. Renowned foreign investors have put in millions and that too in these adverse times. If you ask how much I was expecting to raise, I could never answer. But, just see the high quality and magnitude of the investment.|
|You said “adverse times”. Are you referring to the run-up to the issue and to those who said the stock is overpriced?|
|No, not at all. Real estate is a sunrise sector. People do not understand how to evaluate these stocks. Incorrectly, people talk about land banks.|
|The other day I saw an analyst on TV say that one of the negatives of DLF is that it is too highly concentrated in Gurgaon. What is he talking about? It is common sense that Gurgaon will continue to flourish. Connectivity with the expressway and the Delhi Metro is only going to help Gurgaon. We are sitting on gold and platinum.|
|Will KP Singh and DLF make another Gurgaon ever?|
|In my lifetime, that is not possible, but I hope my son and grandchildren would. And I know my son (the 48-year-old Rajiv Singh) has plans for it.|
|You aren’t telling us about the next Gurgaon…|
|I cannot share that with you…people will then start buying land there! You have no idea how difficult it was for me to make DLF City successful. Nobody except I had faith in the project.|
|Whoever thought people would live 20 km outside of Delhi? It was initially called DLF Qutab Enclave. Why did I call it that? It was just a marketing gimmick…making the township sound as if it was an enclave of Qutab Minar, even though it was 15 km away. I had a vision and convinced people (to buy it).|
|So will Rajiv do it then?|
|I know he is my son, but if I divorce myself from that relationship, I have to say that he is one of the greatest visionaries. Just imagine what he has done. Anybody can be a builder, but only visionaries can be developers.|
|My son is an alumnus of MIT. When he joined the business 15-20 years ago, he told me, “Dad, this is not the way to do it. We need to shift from plotted development to high-rise buildings.” Outside of Bombay, where had you seen group housing? DLF pioneered high-rises and today everyone is following us.|
|Two years ago, Rajiv got McKinsey to restructure the company. They did a great job and we paid them a lot of money! Then Rajiv gave a $13 million order to IBM for our systems.|
|Today, we have over 200 subsidiaries across India and we are one of the most automated companies. We prepare audited results of all subsidiaries here within 10 days of the financial year ending—it is a different thing that now they will be prepared in five days.|
|Will DLF always be controlled by the family?|
|What is wrong with family control? We have done very well. DLF will always be family-owned but will be a professionally run company.|
|In hindsight, could the issue size have been larger?|
|No. That was not required. If we had done that you people would have criticised it….We can always come back for a fresh round.|
Talks between Idea Cellular, India’s sixth-largest wireless operator, and the BK Modi-owned Spice Telecom on a merger have broken down due to differences in price, a person close to the negotiations said. The two sides had held preliminary discussions on the possibility of a merger or an acquisition by Idea three-four weeks ago. Idea, which is present in 11 out of the country’s 23 circles, was keen on expanding its subscriber base. But it baulked at the price being demanded by Spice Telecom.
“Expectations of the Spice management were unrealistic. They were quoting almost twice the value of the company. The merger was called off around a fortnight ago. There is no question of it even after the Spice IPO,” said the person who did not wish to be quoted as he is not authorised to speak. Idea Cellular MD Sanjeev Aga refused to comment. Spice Telecom CMD Dilip Modi could not be reached for comment.
Spice, which offers cellular services in Punjab and Karnataka, had revenues of around Rs 553 crore in 2006. It was looking at a valuation of about $1.3 billion (over Rs 4,300 crore). Idea found it excessive, as Spice does not have a nation-wide presence and continues to make losses.
Analysts say that if Bharti Airtel’s valuation is taken as the benchmark, Spice would command a price of about $1 billion. But Spice is only present in two circles and is a pure-play mobile company compared with Bharti, an all-India integrated operator. Therefore, Spice’s valuation would be at a discount of 30%-35% to Airtel, or about $650 million-$700 million.
Idea officials are also believed to have cited Spice’s weak presence in Karnataka as a dampener. It ranks sixth in the southern state with a share of around 7% despite having made an early start. While most operators have expanded footprint across India after starting with a few circles in the 1990s, Spice has confined to just two circles. It applied for pan-India licences only in September last year.
Idea is present in 11 out of 23 circles and has licences to operate in Mumbai and Bihar where is expects to roll out services as soon as spectrum is allocated. While a merger with Spice would have given it ready presence in two more circles, the price demanded was almost four times Idea would need for rolling out greenfield operations in these two circles. Idea shares gained 0.79% to close at Rs 115.50 on Friday.
The BK Modi group has a 51% stake in Spice, while Telekom Malaysia holds the rest. After the IPO, Telekom Malaysia will hold 39% and the Modis 41%. Another person close to the Modi group said the group had been keen on exiting Spice at a good valuation. “They have been looking for a buyer and while Telekom Malaysia has shown some interest, it will also not pay too high for buying out Modis,” the person, who did not wish to be identified said.
Citigroup in their weekly technical report,
Nifty — The index traded flat on the opening session of the week; it dipped down toward 4100 levels and saw a rise toward the latter part of the week's trading. It
ended the week up 26 points.
Daily Simple Moving Averages — The index is trading around the averages, witnessing support and resistance around the averages. The 10 dma = 4183; 20 dma = 4223; 50 dma = 4112. The 10 & 20 dma crossover is negative, suggesting pullback will face resistance at higher levels. [dma = daily simple moving averages; negative crossover – 10 dma has crossed the 20 dma from above.]
Momentum Oscillators — The RSI (14) - Relative Strength Index on the daily chart is exhibiting a reading of 49.79 (reading of 30 signifies oversold). MACD on the daily chart is in sell mode. Stochastic Daily (5,3) is in buy mode. Momentum study suggests Nifty can see intra-week volatility.
Fibonacci Retracement — The retracement levels of the decline from high of 4363 (4 June 07) to the low of 4100 (12 June 07) are: 50% = 4232 (approx.) and 62% = 4263 (approx.). Index can see test of retracement levels during the current week.
Support — The index has support around 4112 (50 dma) – 4100 & 4052. Intraweek dips should find support around 4100 levels.
Resistance — The index has resistance in the 4223 (20 dma)-4232 band.
Conclusion — We expect range-bound movement with rise toward 4232; intra-week
volatility can be expected.
|The pattern of three successive lower tops since June 4 suggests that the market has entered an intermediate downtrend.|
|The market eased through several sessions of consolidation at lower levels followed by an abortive breakout on Friday. The Nifty closed at 4171 points for a nominal gain of 0.64 per cent. The Sensex was up 0.7 per cent at 14063 points. The Defty moved up by 0.8 per cent as the rupee continued to strengthen.|
|Breadth was almost balanced by the weekend while volumes were low through the week. FIIs and Mutual funds showed divergent trading patterns through the first four sessions of the week. The FIIs were net buyers while the mutual funds were net sellers. The Broad BSE 500 did gain 0.83 per cent.|
|Outlook: The Nifty found support several times at around the 4100 mark. It failed to beat resistance at 4175. Next week could see range-trading inside this same zone. Or, there may be a dip till the next support at 4050.|
|The signals don't suggest an upside breakout. In fact, the pattern of three successive lower tops since June 4 suggests that the market has entered an intermediate downtrend.|
|Rationale: ifty 4100 appears to be a pretty good support. But the market will need to generate much higher volumes to burst through the selling pressure at 4170-plus.|
|This didn't happen this week due to liquidity being sucked off by DLF's IPO and it's unlikely to happen next week if only because of ICICI's FPO. On the downside, the secondary support at 4050 seems strong. But if that is broken, a dip till 3850 is on the cards.|
|Counter-view: Sentiment may just improve given the qualified success of the DLF IPO. If it does, the requisite volumes could be generated to create an upside breakout. Even then, the market will face continuous selling pressure above 4200.|
|Bulls & Bears: At the stock-specific level, the bearish impression is reinforced. Most stocks across the F&O universe are in range-trading mode. A few are bearish. However there are some lower-weighted stocks that seem capable of moving up despite the generally indecisive or bearish mood. Our picks for the week are all chosen from these non-correlated scrips.|
|In terms of sectors, some smaller banks such as Corporation Bank, Syndicate Bank, UTI Bank Union and Vijaya Bank are mildly bullish. There's also a little bullish action in Bhel, Suzlon Energy and Tata Power.|
|Apart from these sector-specific moves, isolated gainers such as Divis Lab, GMR Infrastructure, Maruti, Reliance Capital, Titan, Nicholas and TVS are visible. This is not enough to pull the market up given the number of range-trading pivotal stocks.|
Current Price: 599.75
Target Price: NA
|The stock has made a breakout but this hasn't been backed by a volume expansion. The chart formation suggests that a target of 640 is possible and a projection made off weekly charts would lead to a target of 700 in the timeframe of 3 months. However the lack of volumes should be a danger signal. Keep a stop at 595 and go long.|
Current Price: 1896.55
Target Price: 1940
|The stock surged on Friday with a sharp volume expansion. It is going to test resistance at 1940 so that is a minimum upside target. If it managesto close above 1940, there will be a target projection of 2150. Keep a stop at 1885 and go long.|
Current Price: 564.15
Target Price: 540
|The stock continues to rise with support on a 45 degree trendline which it has managed to maintain since early April when it came off a low of 327. It's impossible to project a target with this formation except by trendline extension. Keep a trailing stop at 540, go long. Move the stop up 10 points for every 10 point advance.|
Current Price: 301.5
Target Price: 325
|The stock jumped on Thursday, closing at 306.5 with a volume expansion. There was a lot of profit booking on Friday but that caused only a minor pullback. There is an upside till 325. Keep a stop at 290 and go long. It may be worth holding a reduced position even above 325 because the major trend has changed.|
Current Price: 1387
Target Price: 1475
|The stock is testing resistance at current closing levels and slightly above. If it closes above 1405, it will complete a formation with a likely target of 1475-80 and a potential target of 1515.|
Research: UBS Investment (June 14, ’07)
CMP: Rs 1,680 (Face Value Rs 10)
Based on an improved outlook for gas price realisation from KG D6 gas, UBS Investment has raised the FY09 EPS estimate by 3.6% from Rs 96.4 to Rs 99.8, while FY08 estimate remains unchanged. Media reports indicate that Reliance Industries (RIL) has received bids in the region of $4.3-4.7/mmbtu (excluding transportation charges, marketing margins and sales tax) for 25 mmscmd of gas. The contracts are likely to be for three years. UBS is upgrading its estimate for average KG D6 gas realisation from $3.55/mmbtu to $4.2/mmbtu. Recent disclosures by RIL’s partner, Hardy Oil (HOGP), indicate additional upside in new blocks D3, D9 and GS-01. HOGP has estimated gross prospective resources of 33.6 tcf of gas in D9 and 4.2 tcf of gas in D3. RIL has 90% interest in these blocks.
Research: Macquarie (June 13, ’07)
CMP: Rs 101 (Face Value Rs 1)
Dabur’s competitive advantage lies in its niche position as the premium player in ‘herbal’ personal care products. The company owns some of India’s most trusted brands in hair care, oral care and health supplements on an Ayurvedic platform. These factors support Dabur’s margins due to sustainable pricing power. The trend of margin expansion is unlikely to reverse. The strength of Dabur’s core business and brands, combined with the positive impact of its recent forays on the bottomline, should protect against any margin erosion due to investment in new businesses such as retail. Macquarie expects Dabur to remain among the fastest-growing FMCG players in India and report a three-year earnings CAGR of 18%. The company’s core business strength has enabled it to consistently deliver 20-50% earnings growth over the past five years. Importantly, earnings have outpaced revenues in each of these years. Dabur trades at a P/E ratio of 17x FY08E earnings, which is at a ~20% discount to its domestic consumer sector peers.
Gujarat State Petronet
Research: Citigroup (June 13, ’07)
CMP: Rs 55 (Face Value Rs 10)
Citigroup has raised the target price of Gujarat State Petronet as higher volumes of gas are likely to flow from Reliance Industries through GSPL’s network, as indicated by the management of both companies. The gas volumes transported through GSPL’s pipeline network are likely to increase ~2.5-fold to 38 mmscmd by FY12E. Recent speculation on the adverse impact of regulatory intervention in setting pipeline tariffs is premature and overdone. Based on the analysis, introducing regulated tariffs on the cost of service methodology may result in a net positive impact of 7-11% to Citigroup’s steady state (FY10-12E) earnings estimates. GSPL is Citigroup’s top pick in the domestic gas utilities space. A pure play gas transmission company, GSPL is highly levered to increasing consumption of gas in Gujarat, without being exposed to the vagaries of gas pricing. The stock trades at 8.8x FY09E P/CEPS, marginally higher than other gas utilities, but this is justified by its 30% EPS CAGR over FY07-10E (significantly higher than peers) and highest leverage to KG gas
Research: CLSA (June 14, ’07)
CMP: Rs 690 (Face Value Rs 10)
Jaiprakash is well-positioned for growth in the construction, cement, hydropower and real estate sectors. Cement capacity is set to triple by FY10 and construction revenue should improve by H2 FY08 as the Taj Expressway project takes off. Jaiprakash will triple its cement capacity to 21.7 million tonnes by FY10CL. Its average cost of capacity expansion is 30-40% below benchmark replacement cost, and it will receive excise duty and sales tax exemptions at some of its new plants. The government’s strategic interest in hydropower will boost the company’s construction order flow (hydro-projects comprise 70% of the order book) and provide opportunities for investment in new projects. The company’s two existing projects earn a 22-24% return on equity. Jaiprakash’s construction business will also see a rebound in construction segment revenue in FY09CL, with a pick-up in progress of the Rs 6,000-crore Taj Expressway project. The addition of 650 acres to its existing land bank of 600 acres in Noida, over the next few months, will deliver visibility on the value-creation potential in the Taj Expressway project.
Research: Enam Securities (June 11, ’07)
CMP: Rs 120 (Face Value Rs 10)
Indraprastha Gas (IGL) is the only distributor of compressed natural gas (CNG) and piped natural gas (PNG) in the national capital territory of Delhi (NCTD). IGL offers a leveraged play on the increasing penetration of natural gas in India. During Q4 FY07, IGL continued to benefit from its aggressive marketing strategy in CNG and PNG. As a result, it experienced a 12% YoY and 2% QoQ growth in CNG, primarily driven by conversion towards CNG by private car owners. PNG sales grew 44% YoY and 14% QoQ in Q4 FY07. Overall, IGL posted a 13% volume growth in Q4 FY07. Enam expects IGL to sustain a long-term volume growth of over 10% given: (1) economic benefits of CNG (2) regulatory directives and (3) a relatively under-penetrated market. Although competition remains inevitable in the near future, Enam expects IGL’s leadership position to be maintained, given its access to gas supplies and its first mover advantage. Given IGL’s strong business franchise, superior profitability and inexpensive valuations, it’s attractively valued at 9.8x FY08E EPS.
Research: ASK Securities (June 13, ’07)
CMP: Rs 178 (Face Value Rs 10)
Gateway Distriparks (GDL) is the largest private sector logistics service provider in the container freight station (CFS/ICD) business with a market share of 18%. With India’s containerised traffic set to double to 10 million TEU over the next five years, GDL is well-positioned to capitalise on the same. Unbridled competition in the traditional CFS business has led to a price war, which is most likely to play out for a few more quarters. Hence, margins may remain range-bound at 50%. Landside infrastructure development, particularly with regard to the upcoming dedicated freight corridor, may not lock step with growth in container traffic and therefore, the shift in time lines will impact the overall throughput. GDL is in the right business at the right time. While opportunities are compelling, the near-term prospect for GDL is lukewarm. Hence, GDL is an investment proposition only for the long term. Based on ASK Securities’ DCF analysis, the fair value is Rs 251. GDL discounts its FY08 and FY09 earnings of Rs 9.8 and Rs 11.6 by 18.2x and 15.5x, respectively.
Research: Merrill Lynch (June 8, ’07)
CMP: Rs 250 (Face Value Rs 2)
Merrill Lynch has downgraded Max India to a ‘sell’ as the company continues to lose market share and its first-year premia growth (though up 72% YoY) was 17% below estimates and 30% below the sector growth of 104%. Healthcare revenues were also 16% below estimates. Merrill Lynch has assigned higher NBAP multiples of 20x FY09E NBAP (v/s 16x earlier) due to its strong growth trajectory and higher margins that Max New York Life is likely to have on higher share of traditional policies and lower costs.