SPEAK ASIA –ATTEMPT FOR ANOTHER FRAUD

Already 5 officials of Speak Asia are cooling their heels in Mumbai police stations. Today TOI carry’s a half page advertisement on one of their product YUG LCD TV.

It says “contrary to the market offers we offer the unbelievable -an LCD 22”TV @RS9998.” This is another fraud on the gullible consumers. First, they do not have any show room or service centers. The brand and the manufacturer are unknown. Apply commonsense. Speak Asia is not into charity. Only a manufacturer or established wholesale trader can sell at a very competitive price. Neither Speak Asia is the manufacturer or the wholesaler and definitely not into charity. This is another attempt to divert the attention of public and law enforcing agencies who are probing the fraud committed by the company. Public are here by warned not to fall into the trap. The established brands too are available in the same price range. Buy from a trusted dealer.

Comparative prices.

BRAND	PRICE
PANASONIC VIERA	RS 10479
VIDEOCON VLL	RS 11600
LG19LH20R	RS 11500
SANSUI S2230YV	RS 9990
SPEAK ASIAYUG##	RS 9998

## UN KNOWN BRAND

IPO SUBSCRIPTION :L&T FINANCE HOLDINGS FINAL TALLY 5.19 TIMES

FORTHCOMING IPOS

NAME OF THE COMPANY	Auto Mark Industries (India) Limited
PROMOTERS	Arun D Khara and associates
ISSUE SIZE	1,25,00,000 equity shares
BRLM	Comfort Services
REGISTRAR	Sharepro Services

NAME OF THE COMPANY	Abhijeet Power Limited
PROMOTERS	Manoj Jayaswal and associates
ISSUE SIZE	Rs 1375cr
BRLM	DSP Merrill, Enam, Axis Bank, IDFC Capital SBI Caps and UBS Securities
REGISTRAR	-

NAME OF THE COMPANY	Tejora Technologies Limited
PROMOTERS	-
ISSUE SIZE	40,00,000 equity shares
BRLM	Unicon Capital Services
REGISTRAR	Big share

NAME OF THE COMPANY	Ind Ecoventures Limited
PROMOTERS	-
ISSUE SIZE	Rs 105cr
BRLM	Saffron Capital
REGISTRAR	Big share

NAME OF THE COMPANY	PME Power Solutions India Limited
PROMOTERS	-
ISSUE SIZE	1,14, 23, 226 equity shares
BRLM	Edelweiss, Imperial Corporate Finance
REGISTRAR	Link Intime.

SPEAK ASIA'S COO TARAK BAJPAI DETAINED BY MUMBAI POLICE

Mumbai police have arrested the COO of Speak Asia, the on line MLM company, for alleged fraud.

IPO LISTING NEWS- BGIM LISTS AT 65% DISCOUNT

The IPO which was made at Rs 82, closed at Rs 28, on the first day. We had indicated that this company is another SRG Infotec in the making. Our analysis and recommendations have come true.

L & T FINANCE HOLDINGS IPO FULLY SUBSCRIBED.

In spite of Sensex being down by more than 300 points since the IPO opened for public, the issue fully subscribed today, the penalimate day.

L & T FINANCE HOLDINGS IPO GETS GOOD RESPONSE ON DAY ONE

The IPO received subscription to the extent of 46% on the first day.

L&T FINANCE HOLDINGS ROPES IN ANCHOR INVESTORS @RS 56 A SHARE.

L&T Finance Holdings has raised Rs 153cr by placing shares with anchor investors, @Rs 56 a share. The anchor investors include Tioman Investments, DSP Black rock and Capital International.

The IPO which opens for subscription today has a price band of R 51-59.

FIRSTCHOICEIPO recommends subscription to the issue.

SKS MICRO Q1 RESULTS, REPORTS HUGE LOSS

The Company posted a loss of Rs 219cr for the quarter ended June 30, 2011 as compared to profit after tax of Rs 67cr for the quarter ended June 30, 2010. Total Income has decreased from Rs 313cr for the quarter ended June 30, 2010 to Rs 177cr for the quarter ended June 30, 2011.

IPO LISTING NEWS: BHARATIYA GLOBAL INFO MEDIA TO LIST ON 28-07-11

FIIs NET BUY RS 316 CR.

FIIs, on 22-07-11, had net purchases to the extent of Rs 445cr and today they increased their purchases by another Rs 316cr. The figures for DIIs is Rs 243cr and Rs 224cr respectively. The Sensex reacted positively, up by 149 points, today.

RIL Q1 NET PROFIT UP BY 16.7%, EPS @RS 17.30

The country's biggest corporate entity, RIL, has posted a rise of nearly 17% in net profit in its first quarter of FY12. During the period, the company's PAT jumped to Rs 5,661 crore against Rs 4,851 crore in the previous fiscal.

Net sales of the company shot up more than 39% to Rs 81,018 crore from Rs 58,228 crore, Year-on-Year.

The company shares closed at Rs 882, up 1%, in the exchanges.

FIIs NET BUY RS 293CR IN CASH MARKET.

Foreign money continue to flow into Indian equities. FIIs today are net buyers to the extent of Rs 293cr. Heavy delivery based transaction has taken place in RIL, Hindalco, Infosys and TCS, among others. Expect these counters to move up substantially before the July contract expiry.

FRANKLIN TEMPLETON AND LIC UP THEIR STAKE IN RELIANCE INDUSTRIES.

The country's biggest insurer and Franklin mutual fund have purchased shares worth Rs 200cr between April-June period. LIC holding now increased to 7.16% and Franklin holding to 1.05%. Currently, promoters holding stood at 44.72 %, where as FII holding at 17.37%.

INFOSYS PLANS IT CENTER IN GUJARAT, SIMILAR TO MYSORE FACILITY.

IPO ANALYSIS: L&T FINANCE HOLDINGS LIMITED – HIGH PEDIGREE – INVEST.

ISSUE OPENS ON 26-07-11, CLOSES ON 29-07-11.

PRICE BAND RS 51-59.

ISSUE SIZE RS 1275CR.
IPO GRADE 5 BY CRISIL, CARE, ICRA

This company / group needs no introduction. The company is promoted by Larsen & Toubro Limited (L&T), one of the leading industrial group in the country, with interests in engineering, construction, electrical and electronics manufacturing and services, information technology and financial services.

The company has recently raised Rs 330cr, at Rs 55 per share, by making placement to US private-equity fund Capital International.

L& T Finance Holding company offers a diverse range of financial products and services across the corporate, retail and infrastructure finance sectors, as well as mutual fund products and investment management services, through the direct and indirect wholly-owned subsidiaries. The Company is registered with the RBI as an NBFC-ND -SI.

The company is headquartered in Mumbai, and has a presence in 21 states in India. As at August 31, 2010, we had 715 points-of-presence across India, comprising 103 branch offices, 221 meeting centers.

The network of offices has been established to cater to the growing business needs of the diverse customer base, which includes individual retail customers as well as large companies, banks, multinational companies and small- and medium-enterprises, and to provide them with satisfactory customer service according to their varying requirements.

The operations are arranged into four business groups, being the Infrastructure Finance Group, the Retail Finance Group, the Corporate Finance Group and the Investment Management Group.

The total income of the Infrastructure Finance Group for Fiscal Year 2010 was Rs. 4,504.23 million which accounted for 31.63% of the total income. The total loans and advances outstanding of the Infrastructure Finance Group as at March 31, 2010 were Rs. 42,884.99 million and total disbursements for Fiscal Year 2010 were Rs. 37,955.14 million. The wholly-owned subsidiary, L&T Finance Limited , conducts the retail finance business and the corporate finance business.

STRENGTHS:

• Diversified and balanced mix of high growth businesses.
• Strong distribution network, with a presence throughout the country.
• Experienced management team and employees with a proven track record of establishing and growing new lines of business.
• High quality loan portfolio comprising the funding of mainly income-generating assets and activities.
• Good financial and capital position, as well as access to multiple sources of capital.
• Strong parentage and brand equity of L&T.

The company earned a PAT of Rs 392 crore in FY11, up from 262 crore,compared to the previous year.

VALUATION AND RECOMMENDATIONS:

At Rs 51-59 price band, the issue priced around 20 times its FY11 earnings, on post issue capital. The price to book value (P/BV) works out to 2.3 times. The higher valuation is justified considering its pedigree, management and business model. The company is likely to get a banking license too.

Investment in IPO is recommended both for listing gains and long term appreciation.

The issue is lead managed by JM Financial, Citigroup Global Markets, HSBC Securities, Barclays Securities, Credit Suisse Securities and Equirus Capital.

21 RIL blocks may get nod for stake sale

BP has agreed to buy stake in 23 oil and gas blocks of  RIL for USD 7.2 billion, the government may next week give unconditional approval for stake sale in only 21 blocks.

HINDALCO'S SAMBALPUR PROJECT GETS ENVIRONMENT MINISTRY'S APPROVAL.

The environment ministry panel has recommended clearance to Aditya Birla group flagship Hindalco Industries' coal mine project in Sambalpur, Orissa for doubling its capacity to three MTPA.

RIL TO ANNOUNCE Q1 RESULTS ON 25-07-11.

EXPECT THE SENSEX TO MOVE UP BY 500 POINTS, NEXT WEEK.

In the last three trading sessions both the FIIs and DIIs are net buyers to the extent of Rs 600cr and Rs 110cr respectively, in cash market. Big ticket delivery based transaction seen RIL, Infy, TCS, Hindalco and SBI. Barring unforeseen negative macro economic news, the Sensex is likely to gain 500 points next week. The Euro zone shadow and probable down grading of US debt is unlikely to affect our markets. The Nifty faces stiff resistance at 5775 level. After consolidating at this level, the Nifty may cross 6000 level. Stay invested in index stocks and indices.

IPO ANALYSIS : INVENTURE GROWTH AND SECURITIES - INTOLERABLE PRICE BAND - AVOID.

Incorporated in 1995, Inventure Growth and Securities Ltd (IGSL) offers trading services in equity, debt market, commodities and currency futures segment to financing activity, wealth management, and distributions of financial products.

The IPO opens on 20^th July 2011. The company is issuing 70 lakh equity shares of Rs.10 each, in the price band of Rs. 100 to Rs. 117 per share, to raise funds around Rs.80 crore. The issue, comprising a dilution of 33.33%, closes on 22^nd July.

Inventure Growth has operations mainly in the western region. The timing of the IPO is not appropriate, in the present market conditions, since most brokerages are down-sizing operations and barely managing to stay afloat due to intense competition and meagre income.

IGSL has Growth tepid growth for FY11. In fact in the last 3 years the CAGR of the company is only 4%. The company does not have any investment banking or corporate advisory division, which can support it with high fee income, in these thin retail volume days.

For FY11, company reported an EPS around Rs. 4, on equity of Rs. 14 crore. At upper end of 117, share is being issued at a PE multiple of 26 times, which is highly intolerable given that brokerages of much better scale and size, are ruling at much lower PE.

In 2010, Microsec Financial Services, a Kolkata based brokerage firm had gone public. As against the issue price of Rs 118, the shares are trading around Rs 38. Even the larger brokerages such as Edelweiss Capital, MotilalOswal and Emkay Global and others have disappointed the investors.

ICRA has awarded grade 2 to the IPO indicating below average fundamentals.  The BRLM – Intensive Fiscal Services is unknown. One more poor quality IPO, which has been priced at its FY 2015 earnings.

Avoid subscription.

IPO SUBSCRIPTION STATUS : BHARATIYA GLOBAL INFO MEDIA

The IPO received subscription to the extent of 47% on the third day. The issue closes tomorow.

Avoid subscription, it will go Readymade Steel way.

DSQ SAGA IN SKS MICRO

On July 6th, the Finance Ministry released a draft regulation bill on MFIs. By coincidence or otherwise, on the same day,  the circuit filter for the scrip raised from 5% t 20 % for the reasons best known to the Exchanges. The stock was up by 70% in 5 trading sessions starting from July 6th. The volume was very low initially and picked up on the 5th day, which was to the extent of 74 lacs shares in NSE. However the delivery percentage was very low at 9%.   Today, the scrip was down 10%, with thin volume. There is a report on this subject in today's Business Standard. Hence the circular trading and un warranted bulk deals has not taken place fearing regulators wrath. During 80s few counters like DSQ Software, Pentafour and others were manipulated, through circular trading, before it was busted by Sucheta Dalal. Similar trend is seen here too.

Investors are advised to trade cautiously in this kind of stocks.
.

RIL LEADS THE PULL BACK RALLY, SENSEX UP BY 184 POINTS.

Today's rally was lead by Reliance Industries which closed at Rs 868, up by Rs 20. The other prominent gainers are Dr. Reddy's, DLF, Bharati Airtel, Reliance Cap and Sesa Goa.

The newly listed IPO - Readymade Steel, was closed in the negative, down 36% to its issue price.

IPO LISTING NEWS - READYMADE STEEL TO LIST ON 13-07-11.

NIFTY DOWN 44 POINTS, BUILD UP OF SHORT POSITIONS SEEN IN , BANKS, IT AND METALS STOCKS

FIIs NET BUY RS 517(CM) AND DIIs NET SELL RS 390CR ON 08-07-11

MINING BILL, OIL PRICES DRAG SENSEX

The Sensex was down by 220 points due to heavy selling in Metal counters, coupled with overall negative sentiment due to sharp movement of oil prices in international markets.

STOCK WATCH – SKS MICRO FINANCE– SELL. THE NEW BILL WILL NOT MAKE ANY DIFFERENCE TO THE BOTTOM LINE.

The finance ministry is proposing to introduce a new bill, in the coming winter session of parliament on how to regulate the Microfinance Institutions. Among others the bill proposes to make the RBI as the sole regulator of the segment. As RBI has accepted the recommendations of the Malegam committee, the bill would include all the findings of the committee. The main aim of the bill is affordability for the borrowers and sustainability for the providers. There is no place for exploitation, arm-twisting and profiteering. There would be cap on rate of interest, margins and loan amount. At the best scenario, the net interest margin for these MFI will be around 2% and not more than that.  MFIs have to follow stringent RBI norms on provisioning, capital adequacy.  There will be a committee, consisting of members from the State / Central government /MFIs association to oversee the functioning of the MFIs.  The new bill is good for orderly growth for MFIs. There is no scope for super profits.

Sell SKS Micro and switch to strong and well managed NBFCs like M&M Finance, Bajaj Auto Finance and Shriram Finance, if the investors wish to stay in the NBFC segment.

BRENT MOVES BEYOYND $ 116 A BARREL, STOCKS RALLY MAY NOT SUSTAIN.

One of the fundamental reasons that stocks started moving northwards was easing of oil prices in the international markets due to the initiatives taken by IEA. It was expected that the excess stock released by the IEA would cool down the oil prices substantially, on sustainable basis. Prior to IEA’s action the Nifty was hovering around 5200 level and most experts were predicting that Nifty would test 4800 level. Suddenly the views on emerging economies changed, that the cooling of oil prices would largely benefit these economies and the growth would be robust.   The FIIs who were skeptics on India’s growth prospects till then saw a different picture and started investing heavily and has pumped in more than Rs 10,000cr in the last two weeks. The Brent did react on IEA action. However, within two weeks of IEA action the Brent has not only regained its pre IEA action level, it has moved beyond that level and now it s trading around $ 116 a barrel. It was up almost 3% in yesterday’s trade.

According to Goldman Sachs, oil supplies will become "critically tight" in 2012, largely because production leader Saudi Arabia won't be able to pump as much extra oil as many people believe. Robust global economic growth will continue to drive oil demand that outstrips supply; it is only a matter of time before inventories and OPEC spare capacity become effectively exhausted, requiring higher oil prices to restrain demand.

Now we are back to square one. The ‘reason’ on which the stock rallied is no more there.  The high oil prices will have telling effect on our economy. The euphoria created by aggressive FII buying may not lost long. 

Investors are advised to trade cautiously

MANIPULATION RAMPANT IN NEWLY LISTED IPOS

Birla Pacific Medspa which got just one time subscription got listed at 150% premium to its issue price is surprising. The fundamentals of the company are weak and the business is yet to evolve. There were no takers at Rs10 and it is puzzling that the stock find buyers even at Rs 30, the days high. Will SEBI look into the first day/week price rigging of  newly listed companies. Similar the case with Rushil Decor.

These shares would be available at discount to its issue price in the next few trading sessions, as we have seen in the case of Timbor, Sanghvi Forging and Sevalakshmi Papers.

FIIs NET BUY RS 869CR ON 07-07-11

IPO LISTING NEWS - BIRLA PACIFIC MEDSPA TO LIST ON 07-07-11.

We expect the shares to list at 15-20% discount to its issue price of Rs10.

LISTING NEWS - RUSHIL DECOR TO LIST ON 07-07-11.

DIIs NET SELL RS 898CR ON 05-07-11.

In the last 3 trading sessions DIIs have  net sold to the extent of Rs 1722cr. As against this, net buying by FIIs are to the extent of Rs 2555cr.

FORTHCOMING IPOS

NAME OF THE  COMPANY	CRP TECHNOLOGIES (INDIA) LIMITED
PROMOTERS	Hitesh Asrani
ISSUE SIZE	PUBLIC ISSUE OF 60,00,000 EQUITY SHARES OF ` 10/- EACH
BRLM	Indbank Merchant Banking Services Limited
REGISTRAR	Sharepro Services (India) Private Limited

NAME OF THE  COMPANY	TRIMAX IT INFRASTRUCTURE & SERVICES LIMITED
PROMOTERS	SURYA PRAKASH MADRECHA,  CHANDRA PRAKASH MADRECHA, PRATIK TECHNOLOGIES PRIVATE LIMITED, SHREY TECHNOLOGIES PRIVATE LIMITED AND STANDARD FISCAL MARKETS PRIVATE LIMITED
ISSUE SIZE	PUBLIC ISSUE OF  11,977,000  EQUITY SHARES OF FACE VALUE OF RS 10
BRLM	Kotak Mahindra Capital Company Limited SBI Capital Markets Limited Religare Capital Markets Limited
REGISTRAR	Karvy Computershare Private Limited

NAME OF THE  COMPANY	ABHIJEET POWER LIMITED
PROMOTERS	MANOJ JAYASWAL, ABHIJEET MINING LIMITED AND CORPORATE ISPAT ALLOYS LIMITED
ISSUE SIZE	RS 13,750 MILLION
BRLM	DSP MERRILL,  ENAM SECURITIES,  AXIS BANK,  IDFC CAPITAL,  SBI CAPITAL,  UBS SECURITIES
REGISTRAR	LINK INTIME INDIA

NSE TO INTRODUCE 91 DAYTREASURY BILL FUTURES FROM TODAY

• CBI raid on ex DGH finds no evidence of favoritism by him to RIL.
• RoC report on Speak Asia is expected by July 10.
• Karcham Wangtoo hydro project in HP to be operational by Aug end.
• Fitch lowers GDP growth to 7.7%.
• Future group to exit financial business.
• Supermarket chain Varkeys in talks for stake sale.

IPO ANALYSIS: BHARATIYA GLOBAL INFO MEDIA LIMITED – IPO FROM WATCH OUT LIST PROMOTERS, ANOTHER SRG INFOTECH IN THE MAKING – AVOID.

ISSUE DETAILS

ISSUE OPEN / CLOSE	11-07-11 / 14-07-11
PRICE BAND	RS 75 -82
SIZE OF ISSUE / FV	67,20,000 SHARES / RS 10 (42.42% OF POST ISSUE CAPITAL)
IPO GRADING	2 BY CARE
PROMOTERS	RAKESH BHHATIA, ARTI BHATIA
BRLM	ALMONDZ GLOBAL SECURITIES
REGISTRAR	KARVY

COMPANY BACKGROUND

BGIL is in the business of providing information technology-based security and compliance automation systems, mainly based on RFID platform and has a technology based digital post production service. The RFID segment contributes more than 90% of revenues.

BGIL gets sub-contracts from bigger automation players like Honeywell Automation Ltd. and Siemens Building Technologies Ltd. Apart from the said sub-contracts, BGIL derives revenues from relatively smaller contracts won directly from the end customers.

The names of the Company and three Promoter Group Companies - Number One Finsec Private Limited, Bhhatia Investments & Finance Private  Limited and Grindlay Finman Private Limited are appearing on  www.watchoutinvestors.com in respect of rejection of  application for certificate of registration as NBFC as on July 31, 2004.

FINANCIALS

The total revenue has decreased from RS 3419.49 lakhs during 2007-08 to RS 3359.72 lakhs during 2008-09, increased to RS 4634.10 lakhs during 2009-10. For FY 11 the revenue stood at Rs 7099.78 lakhs. The profit after tax for FY 10 and FY were Rs 2.87cr and Rs 4.55cr respectively. 

OBJECTS

The funds intended to be used for setting up corporate offices in New Delhi and Mumbai, up gradation of Production Studio, Repayment of bank borrowings and for General Corporate purposes.

OUT LOOK FOR THE INDUSTRY

The application of the RFID technology is finding its way in the toll management system and the parking management systems for buildings. Of the central programmes, the National Highways Development Project (NHDP) undertaken by Government of India through NHAI provides a significant opportunity for the development of national highways including construction of bridges, flyovers and elevated structures.

MATTERS OF CONCERN:

IPO grade 2 BY CARE.

The Company had delayed payment of service tax for the last three financial years and the cumulative principle amount of service tax due was Rs 96.22 lakhs as on September 30, 2010, which have paid now in installments till November, 2010.

The Statutory Auditor has qualified their report for the financial years 2010-11, 2009-10, 2008-09 and 2006-07.  

Rakesh Bhhatia was the Managing Director of SRG Infotech India Limited till April 13, 1996, which he joined in 1991.

Delhi office is functioning without the basic registration certificate under the applicable Shops and Establishment Act.

The average cost of acquisition of shares by promoters is around Rs 4.

Share price information of listed promoter Group Company:

The equity shares of BGIL Films & Technologies Limited, promoter Group Company are presently listed on Bombay Stock Exchange Limited. The monthly high and low of the closing market price of the equity shares on BSE for the last two months are Rs 3.30 and Rs 4.85. The market capitalization of BGIL Films & Technologies Limited based on the closing price of Rs 3.24 per equity share on the BSE as on June 10, 2011, was Rs 207.58 lakhs.

The project is not apprised by any bank, incremental working capital not tied up, order for machineries not placed.

The company had negative cash flow in the last four years.

VALUATION AND RECOMMENDATIONS:

Promoters / group background and their listed company performance do not inspire any one to take investment call on the IPO. Post IPO, the promoter holding will come down to 51%.  A substantial amount of the issue proceeds will be used for building corporate offices, repayment of loan, which will not result in revenue accretion. The company has delayed payment to Reliance Capital and Barclays Bank. One of the objects is to reduce loan liability with RBS.  On the other hand, the company says it is yet tie-up the incremental working capital. This is contradicting. The company will have post issue equity of Rs 15.84cr. The EPS, BV, PE have no meaning for these kinds of companies. This is another SRG Infotech in the making.

 

The previous issues of the BRLM are - Omkar Speciality and Texmo Pipes, both are quoting much below their IPO price.

AVOID SUBSCRIPTION.

Facebook in new Avatar from July 6

Mark Zuckeberg, the CEO of  Facebook is set to launch a new video chat awesome product powered by Skype on July 6. The product has been built on Skype and will include a desktop component. Google users can use its chat to have audio and video talks. Facebook has over 800 million users and the Skype recently acquired by Microsoft has over 170 million users.

TATA GROUP MARKET CAP TOUCH $ 100 BILLION

• Big ticket buying seen in RIL stock on 01-07-11.
• Aadhaar enrollment is in full-swing in Maharashtra.
• Apple backed group outbids Google to buy Nortel patents.
• Govt may continue with Subbarao, as RBI governor, for another term.
• TCS plans Rs 2300cr cap`ex for FY12.

RIL DOWN 4%, DRAGS NIFTY

 

The NIFTY was down by 22 points, largely due to lackluster performance by RIL. The stock closed around Rs 860 level. DLF and Cairn were up by 5%, Hindalco was up by almost 4%. The big losers were Jubiliant Food which lost 10% and the recently listed Timbor Home lost another 10% today.