Wednesday, February 3, 2010


Orissa based Infrastructure Company; ARSS Infrastructure Projects Limited plans an IPO of Rs 103 crore, by issue of 2.3 million shares of Rs 10/- face value, in the price band of Rs 410-450 per share. The issue opens on 8-02-10 and closes on 11-02-10. IDBI Capital Markets Services Limited and SBI Capital Market Limited are the BRLMs.

PROMOTERS: Anil Agarwal, Rajesh Agarwal, Subash Agarwal, Sunil Agarwal and associates, are the promoters of the Company.


The company is engaged in the business of construction activities. It undertakes construction of railway infrastructure, roads, highways, bridges and irrigation projects.
The Company specializes in railway construction projects, which includes earthwork, major and minor bridges, supply of ballast, sleepers, laying of sleepers and rails, linking of tracks etc. Over the years, the Company has diversified its activities into other construction segments. Its clients' list includes Ministry of Railways, State Government of Orissa, Rail Vikas Nigam Limited, RITES Limited, IRCON International Limited, National Thermal Power Corporation, Hindustan Steel Corporation Limited, IOCL and the National Highway Authority of India. The company has predominance presence in Eastern India, particularly in the state of Orissa.
The Company has successfully executed over 77 projects involving construction of approximately 300 km of roads and highways, 200 km of rail tracks, 10 minor and major bridges and other general civil engineering works over the span of seven years.

The proceeds of the Issue are intended to be deployed for;
(a) Investment in joint ventures. (b) Funding long-term working capital requirement and (c) General corporate purposes.
The funds requirement and funding plans are based on internal estimates of the Company and have not been appraised by any Bank/Financial institution.

FINANCIALS: 07 08 09 (Rs in crores)
Total Income 143.84 315.41 628.22
Net Profit 10.55 26.84 51.19
EPS (Rs) 10.96 23.54 40.77
Weighted average 30.06

1. CARE has assigned Grade 2/5 to the IPO, indicating less than average fundamentals.
2. As of June 2009, the company has debt of nearly Rs 240cr.
3. One of the Promoters of the Company is involved in a criminal proceeding in relation to the murder of one Rubu alias Subash Chandra Das.
4. The Company has defaulted in making payment of interest and repayment of loans amounting to Rs. 24.25 lacs, Rs. 11.78 lacs and Rs. 23.09 lacs during the Financial Year ended March 31, 2006, March 31, 2004 and March 31, 2003 respectively to various banks and/or financial institutions. .
5. The Central Electricity Supply Company of Orissa Limited (CESCO) has disconnected the power supply to one of the Units of the Company, due to default in payment of electricity bills.
6. The crusher unit of the Company at Nityanandpur, Orissa, currently does not have power supply. The Company is required to pay to CESCO, certain amounts due and payable under the bills raised for the purpose of supply of electricity to the said plant.
7. The income-tax authorities have carried out search and seizure operations in the premises of the Company and the residential premises of the Promoters and Directors and during this operation the Company, Directors and Promoters have made certain voluntary disclosures in relation to understatement of income of earlier years.
8. The company faces stiff competition in the construction business, from Tantia Constructions Limited, IVRCL, Kalindee Rail Nirman (Engineers) Limited, Harish Chandra (India) Limited and others.
9. Family owned, controlled business enterprise.

India's infrastructure, which has been expanding at an accelerated pace has slowed down in 2008-09 because of the global turmoil. India’s GDP growth for 2008-09 was 6.7%, down from the 9% average growth experienced over the last three years.
The growing demand of transport, in general, is directly related to the growth of the economy, the mobility of the population and other related factors. Indian Railways has planned to carry the traffic offered by the buoyancy in the economy. The increased output of basic industries such as power, steel, cement, fertilizers etc. is foreseen as necessitating facilities for bulk transport in which the railways have a comparative advantage. The increasing rate of urbanization is also expected to generate demand for a rapid transit system.
Roads, including national highways and state roads, continue to drive construction investments. The key programmes under road development include the National Highway Development Programme (NHDP), Pradhan Mantri Gram Sadak Yojana (PMGSY), and Special Accelerated Road Development Programme.
The growth of the infrastructure industry in India and business is dependent on the establishment of stable Government policies and a prudent regulatory environment. Infrastructure development in India has historically been the preserve of the Central and State Governments. Changes in Government policies, which began in the 1990s, facilitated the entry of private capital into infrastructure and have led to rapid growth in certain sectors. Policy changes in energy, urban infrastructure, and industrial and commercial infrastructure sectors have begun to attract significant private sector interest.
Currently, the Company has a substantial exposure to the Government bodies for revenues and work orders. ARSS derived 73.64%, 72.95 % and 80.96 % of revenues for the periods FY2009, FY2008 and FY2007 respectively and 76.34% of the Order Book as on July 31, 2009 is from Government bodies.


At Rest 450/- the company demands, P/E of 11.3 on FY 09 net profit. Considering the questionable professional management, the valuation, is on the high side. Investors may stay away from the issue.

Sunday, January 31, 2010


India’s largest power generation company, NTPC is entering the capital markets on February 3, 2010 with its follow-on public offer (FPO) of 412,273,220 equity shares of Rs 10 each, in the price band to be determined through competitive bidding process. The FPO will close on February 5, 2010.The offer marks a ‘divestment’ of 5% in NTPC by GOI. After the FPO, Govt holding will come down to 84.5% of Equity Share capital.

ICICI Securities Limited, Citigroup Global Markets India Private Limited, JP Morgan India Private Limited and Kotak Mahindra Capital Company Limited are the book running lead managers to the Offer.


NTPC is the largest power generating company in India. The owned, installed power generating capacity is approximately 18.6% of India's total installed capacity. In Fiscal 2009, the company contributed 28.6% of the total power generation of India. NTPC is the top IPP in Asia, and ranked second in the world, on the basis of asset worth, revenues, profits and return on invested capital, according to a study conducted by Platts, of the McGraw-Hill group. As of September 30, 2009, the total installed power generation capacity is 30,644 MW, including 28,350 MW of generation capacity through 112 units owned by NTPC and 2,294 MW of capacity through 2 joint venture companies. Of the owned capacity, 86.0% is coal-based, operated through 15 coal-based power stations, and 14.0% is gas-based, operated through seven gas-based power stations (including one naphtha-fired station). In the year 2009, NTPC generated 206.9 billion units of electricity through owned stations. NTPC operates through power stations at a level of efficiency that exceeds the average in India, based upon availability factor (which is a measure of how often a station is available to generate power) and average plant load factor (“PLF”) (which is a measure of how much of its capacity a plant actually uses to generate electricity). During 2008-09, the coal-based stations operated at an average availability factor of 92.5%, and achieved an average PLF of 91.1%, compared to the all-India average PLF for coal-based stations of 77.2%. Out of 15 coal-based power stations, four operated at a PLF of greater than 95.0% and one operated at a PLF of 99.4%. The gas-based stations operated at an average availability of 86.7% and an average PLF of 67.0%, compared to the all-India average PLF for gas-based stations of 57.6%.


The objects of the Offer are to carry out the divestment of 412,273,220 Equity Shares by the Selling Shareholder (Govt of India). NTPC will not receive any proceeds from the Offer and all proceeds shall go to the Selling Shareholder.


The company achieved a turn over of Rs 40017.70cr and Rs 45272.80cr for the years 08 and 09 respectively. Net profits after tax were Rs 7414.80cr and Rs 8201.30cr. The weighted average EPS for the above periods was Rs 9.63. The weighted average RoNW for the same period is 14.23. NAV as on 30-09-09 is Rs 75.01.


• The company is entering into new businesses – power trading /distribution, and to develop nuclear power stations.

• The company has formed joint ventures for the manufacture of equipment used in the power business. Prior to entering these joint ventures, NTPC was not engaged in manufacturing business. NTPC’s ability to succeed in the manufacturing business is to be seen.

• The State Electricity Boards (SEBs) and the state owned distribution companies are the largest purchasers of power from NTPC and currently account for more than 90% of sales of electricity. NTPC is obligated to supply power to them in accordance with the terms of the allocation letters issued by the GoI for each of the power stations. Historically, NTPC had significant problems in recoveries from SEBs.

• The success of NTPC’s operations, and the proposed expansion of generation capacity, will be dependent on, among other things, the company’s ability to ensure unconstrained availability of fuels at competitive prices during the life cycle of the existing and planned thermal power stations. Fuel represents the largest expense and the two primary fuels being coal and gas.

• NTPC faces competition because of deregulation in the Indian power sector.

• NTPC has executed a letter of intent with Reliance Industries Limited (“RIL”) for the purchase of gas, which if not declared as a valid and binding contract between NTPC and RIL, may negatively impact the financial results of operation.


• Leadership position in the Indian power sector.
• Strong cash flow.
• High operational efficiency of coal-based stations.
• Long-term agreements for coal and gas supply.
• Strategic locations near fuel source.
• Ability to turn around under-performing stations.
• Experienced in-house engineering capabilities.
• Advanced information technology platform.
• Strong balance sheet.
• Government support.


The share, currently, is quoting around Rs 215/- in the exchanges. Unless the offer price is substantially less than the market price, it does not make any sense to invest in the company’s shares. Invest if it is going to be priced at Rs 200/- or below. However, it is a good long-term bet.

Friday, January 29, 2010


ISSUE DETAILS: Public issue of 95, 74, 000 equity shares of Rs 10/- each, in the price band of Rs 40 -45.The company plans to raise Rs 42.00cr through the issue. Keynote Corporate Services are the sole BRLM to the issue. The issue opens for public on 01-02-2010 and closes on 03-02-2010.

PROMOTERS: Makrand Appalwar, Ms. Rinku Appalwar and Dr. Mitravinda Appalwar are the promoter of the Company.


The company is engaged in manufacture, sale of Flexible Intermediate Bulk Container (FIBC - Jumbo Bags), Woven Sacks, and various woven polymer based products like Container Liners, Protective irrigation system, Canal Liners, Flexi Tanks, Car covers etc. The manufacturing facility is located at Silvassa.


• Expansion in the present facility to increase the present installed capacity from 5,000 MTPA to 17,800 MTPA.

• Meet the working capital requirements of the Company.


The company achieved a turn over of Rs 22.91cr, 29.64cr and 38.27cr for the years 07, 08 and 09. The net profits for the above periods are 0.52cr, 0.54cr and 1.36cr respectively. The Weighted Average EPS for the above period is Rs 3.19.

• CARE has assigned an ‘IPO Grade 2′ rating, indicating below average fundamentals.

• The proposed project for which the funds are being raised has not been appraised by any Bank or Financial Institution and the fund requirements are based primarily on Management estimates.

• The company has not yet placed orders for plant & machinery and equipment requirements for our proposed project. Any delay in procurement of plant & machinery, equipment, etc. may affect the viability of the project.

• Primary raw materials are petroleum-based products - leading to higher susceptibility to price fluctuations Price volatility of raw materials (including plastic polymer) used for manufacturing may materially affect business prospects of the company.

• Introduction of alternative packaging materials caused by changes in technology or consumer habits may reduce demand for products and may adversely affect the profitability and business prospects

• The average cost of acquisition of the equity Shares of Rs. 10 each by the Promoter are as under:

Mr. Makrand Appalwar Rs. 4.00
Ms. Rinku Appalwar Rs. 4.00
Dr. Mitravinda Appalwar Rs. 4.00


India's per capita demand for polymers is still a minuscule 6 kg Vis a Vis world average of 27 kg. The growing domestic market as well as export will make India an interesting place for polymer business in the years to come. India has the advantage of a large population and hence expected to maintain high economic growth. This should propel the India’s consumption in polymer to new levels in coming year.

Packaging industry is a multitechnology, multi product, multi process industry encompassing various materials like polymers, chemicals, metals, paper etc. Consumer needs packaging to be protective, attractive and user friendly.

The competitiveness of a nation depends on how it balances economic development of sustainable growth and responsible care of the global environment in a borderless economy. It fully depends on the development of both environmentally sound manufacturing and effective recycling technologies for the products. These include 1) Energy conservation and technology of the Indian manufacturing industry, 2) Development of environmentally sound technology, 3) Effective products recycling technologies, and 4) Sustainable growth in the new chemical age.


At the upper band, the share is valued 13 times the weighted average earnings of FY 07, 08 and 09. The company’s track record of profitability is not so impressive. Considering the risks associated with the project, the valuation is on the high side.

RECOMMENDATIONS: Subscription to the issue does not qualify for recommendation.

Thursday, January 28, 2010



Public issue of equity shares of face value of Rs 10/- in the price band of Rs 468 – 486, aggregating up to Rs 1500cr. Enam Securities Private Limited and Kotak Mahindra Capital Company Limited are the Book Running Lead Managers. The Issue opens for public on 29 - 01 -10 and closes on 02 -02 -10.

PROMOTERS: Shahid U. Balwa, Neelkamal Tower Construction Private Limited and Vinod Goenka – (HUF), are the promoters of the Company.


Mumbai based real estate Development Company, focusing on residential, commercial, retail housing and cluster redevelopment. As on August 31, 2009, there are ten ongoing Projects, aggregating approximately to 18.61 million square feet of Saleable Area, nine Projects in pipeline, aggregating approximately to 20.17 million square feet of Saleable Area.

The residential portfolio currently covers projects catering to customers across all income groups. In the commercial portfolio, the company builds and sells customised office space as per the requirements of buyers. The other projects includes - development of mass housing for the local authority and generating transferable development rights (“TDRs”), cluster redevelopment of old and dilapidated structures.


1. To meet expenses of construction and development of certain projects;
2. To pre-pay the loan taken from IDFC.
3. For meeting expenses towards general corporate purposes.


For the fiscal year ended March 31, 2008 and the period from January 8, 2007 to March 31, 2007, the company reported net loss of Rs. 245.77 million and Rs. 6.34 million respectively. For the fiscal years ended March 31, 2009, the company reported total income of Rs 4644.31 million and net profit of Rs 1458.80 million.


1. Most of the operations are concentrated in and around Mumbai, and as a result, heavily dependent on the performance and the relative conditions affecting the real estate market in Mumbai. In the event of a regional slowdown in construction activity in Mumbai or the surrounding areas, or any developments that are likely to affect projects in and around Mumbai and make them less economically beneficial, has direct bearing on the performance of the company.

2. As at March 31, 2009, the company has lent interest free loans and advances amounting to Rs. 51.5 million, for which the company has not executed any agreements and remain unconfirmed. Any inability by these entities to repay these loans could adversely affect the financial condition.

3. The projects require the services of third parties including architects, engineers, contractors and suppliers of labour and materials. Third party subcontractors perform all the construction work for projects.

4. There are ventures which are promoted by the same Promoters and are engaged in a similar line of business.

5. Heavily indebted company.

6. The company has history of operating losses and negative cash flows in the past.

7. Some of the Subsidiaries and Group Companies (62) have incurred losses during recent financial years.

8. Restrictions on foreign direct investment (“FDI”) in the real estate sector may hamper the ability to raise additional capital, to fund projects on going basis.

9. The average cost of acquisition of Equity Shares by the Promoters are as follows:

Mr. Vinod K. Goenka Rs 2.34
Mr. Shahid U. Balwa Rs 0.48
Neelkamal Tower Construction Private Limited Rs 2.38
Vinod Goenka (HUF) Rs 2.36

10. The fund requirements are based on internal estimates of the management and have not been appraised by any bank or financial institution or any other independent agency.

11. A part of the issue proceeds (Rs 80.00cr) is being utilized for repayment loan.

12. Rating agency CRISIL has awarded grade -2 for the IPO, indicating below average fundamentals.

VALUATION: The company has very limited period of business history. Comparing the performance of one financial year with listed realty majors is not appropriate. For a company with a short financial track record of just an year, the premium sought is on a high side. Investor is not likely to see any gains.

RECOMMENDATIONS: The issue is very aggressively priced. Investors may stay away from the issue.

Tuesday, January 26, 2010


Thangamayil Jewellery Ltd. (TJL) is one of the leading jewellery retailers in Madurai and trades in Gold Jewellery, Diamond and Platinum jewels. The IPO opens for subscription on January 27, 2010 and closes on January 29, 2010, in the price band of Rs 70 -75. BRLM – Keynote Corporate Services Limited.

The company presently has jewellery showrooms in Rajapalayam, Karaikudi and Ramanathapuram.


TJL is raising funds to expand existing business by establishing retail outlets at Tuticorin, Dindigul, Theni, Nagercoil, Tirunelveli, Kovilpatti and Sivakasi and to renovate the existing outlet at Madurai and to meet the working capital requirements.


The operating income increased from Rs 224.5 crores in FY08 to Rs 246.83 crores in FY09. The net profit after tax (PAT) has increased marginally from Rs 5.61 crores FY08 to Rs 7.5 crores in FY09.


a. The company had negative cash flow during the last three years.
b. Rating agency Brickworks has awarded grade three for IPO indicating average fundamentals.
c. Limited geographical reach.
d. High price volatility of gold in international markets.
e. Low margin.
f. The proposed expansion project (Rs 48cr) has not been appraised by any Bank/FI.

VALUATION: In the price band of Rs 70 – 75, the valuations are at 6 times the estimated earnings of FY -10, on post issue equity. Net asset value as on 31-03-09 is Rs 32.90. The issue is very attractively priced.

RECOMMENDATIONS: Apply. There is enough scope for further appreciation


ISSUE DETAILS: Public issue of shares of Rs 10/- each in the price band of Rs 220 -230. Total amount intended to be raised Rs150.00cr. BRLM - Saffron Capital Advisors Private Limited and Centrum Capital Limited. Issue opens on 25-01-10 and closes 28 -01-10.

BUSINESS: The company is engaged in providing logistics services. However, much of its revenue comes from one segment – freight services.

FINANCIALS: 05 06 07 08 09 (Rs in millions)

Income 599.82 957.21 4,306.11 10,940.92 21,405.24

Profit (4.93) (86.28) 281.03 562.76 983.80


a. The company had negative cash flow in the last five years.
b. Brickwork rating agency has awarded grade -3 for the IPO, indicating average fundamentals.
c. The project (Rs 150.00cr) has not been appraised by any Bank/FI. Funds requirement and utilization is entirely left to the discretion of the company.
d. There are no definitive plans for acquisition, where in the company intends to invest around Rs 35.00cr.
e. The company depends upon third parties to provide equipment and services. This may result in delays in delivering the cargo/service on time, which inturn may lead to customer dissatisfaction and loss of further business.

f.Company faces very stiff competition from established multinational players.

VALUATION: At the upper price band, the share is priced about 26 times the company’s likely earnings of FY -10. The valuation is too much stressed, considering its negative cash flow and business model.

RECOMMENDATIONS: Investors are advised to keep away from the issue.


ISSUE DETAILS: Public issue of 75, 00, 000 shares of Rs 10 each in the price band of Rs 65 – 75. BRLM – Charted Capital and Investments limited. Issue opens on 27-01-10 and closes on 29-01-10.

BUSINESS: The company is engaged in the manufacture and marketing of pharmaceutical formulations in the domestic market. The company also undertakes contract manufacturing for various domestic companies.

OBJECT OF THE ISSUE: To set up new manufacturing facilities in SEZ area in Indore.The project has not been appraised by any Bank /FI.

RISKS: The Company operates in a very highly competitive industry/market. Not much experience in manufacturing operations. The longer debtors’ relaisation indicates relatively less bargaining power and consequent strain on cash flow.

VALUATION: At the price band of Rs65-75, the offer is priced around 25 times its likely FY10 earnings. This appears to be on the very high side, considering that many top pharmaceutical companies with better earnings and business prospects are available at much lower valuation.

RECOMMENDATIONS: The issue is very aggressively priced, considering its past performance and future business prospects. Investors advised to stay away from the issue.

Sunday, January 24, 2010


Pune-based, engineering procurement and construction (EPC) services and real estate development company is entering the capital markets with an IPO of 1, 08, 00,000 equity shares of Rs 10/- each in the price band of Rs 165 – 185, through book-building process. Kotak Mahindra Capital Company Limited and Enam Securities private limited are the Book Running Lead Managers. The issue will open on 27-01-10 and closes on 29 -01 -10. .

The Company commenced business as an EPC services company in 1986 and have since, due to synergies between the two businesses diversified into the real estate business as well. As a result, the company currently has two main revenue streams.
VEL’s real estate business comprises construction of residential and office complexes, along with IT parks, industrial units, shopping malls, multiplexes, educational institutions and hotels. As of August 2009, the company had completed 41projects worth Rs 880rc, out of which Rs 640cr was for third parties. In 2008-09, the construction business contributed around 93 per cent to the company’s total revenues. VEL follows a joint development strategy, wherein the landowner brings in the land, while VEL provides the construction expertise. The company has two wholly owned budget hotels in Goa and a three-star service apartment in Pune. VEL has 59 ongoing EPC Contracts, with an estimated total contract value of Rs. 3,378.87cr as on the same date. Some of major EPC clients include well-known companies such as Cipla Limited, Emcure pharmaceuticals Limited, Zensar Technologies Limited, Kirloskar Brothers Limited and Okasa Pharma Private Limited.


The objects of the Issue are to raise funds for (a) construction of EPC contracts and real estate development projects (b) repayment of debt (c) general corporate purposes. The company intends to utilise around Rs 40cr for repayment of loan


In 2008-09, the company reported a net profit of Rs 24.9 cr on a turnover of Rs 509.30 cr, translating into a net margin of 4.9 per cent and EPS of Rs 3.3.The book value stood at Rs 55.2. CRISIL has awarded grade -3 indicating average fundamentals.


The real estate industry is undergoing a significant downturn, if continued for longer period, may adversely affect demand for EPC services business. The company depends heavily on third party contracts.

The projects are generally performed on a fixed-price range basis, except in certain projects where price variations are allowed. Unanticipated costs or delays in performance of a part of the contract can have compounding effects by increasing costs of other parts of the contract and on the bottom line.


At the offer price band of Rs 165 -185, the stock is priced at 50 times of its FY -09 EPS and around 35 times the earnings of FY –10. The issue is very irrationally priced. The best performing stocks in the industry are available for PE less than 20. AVOID SUBSCRIPTION.

Thursday, January 14, 2010


The food service company, which runs Domino’s operations in India, the largest pizza chain, is entering the capital market to raise around Rs 300cr through IPO.

The offer comprises of fresh issue of 40,00,000 equity shares and an offer for sale of 18,670,447 equity shares in the price band of Rs 135 -145. Post issue promoter holding will be 62.19% of diluted equity.

Kotak Mahindra Capital Company are the BRLM and the issue will open on 18-01-10 and closes on 20-01-10.

Domino's operates around 274 stores in India and about 5 outlets in Sri Lanka. They have recently renewed their contract with master franchise controller Domino's International. The new contract is for 15 years, it gives them exclusive rights for operations in India, Nepal, Sri Lanka and Bangladesh. The company plans to open 25 stores in 2011 and 2012.

As per Food Franchising Report 2009, Domino’s pizza is the largest and fastest growing international food brands in South Asia and the market leader in the organised pizza home delivery segment in India with over 65% market share.

The Quick Service advantage

• High speed of service and efficiency: Quick service restaurants typically have order taking and cooking platforms designed specifically to order, prepare and serve menu items with speed and efficiency. Fast and consistent food service is a characteristic of quick service restaurants.

• Convenience: Quick service restaurants are typically located in places that are easily accessed and convenient to customers’ homes, places of work and commuter routes.

• Limited menu choice and service: The menus at most quick service restaurants have a limited number of standardized items. Typically, customers order at a counter or drive through and pick up food that then is taken to a seating area or consumed off the restaurant premises.

• Value prices: At quick service restaurants, average check amounts are generally lower than other major segments of the restaurant industry.


The main objects appear to provide an exit route to group of investors - India Private Equity Fund (Mauritius), Ind ocean Pizza Holding Limited, and repayment of loans and for general corporate purposes.


The company reported a turn over of Rs 148.41cr, 226.34 cr, and Rs 301.77 cr for the years 07, 08 and 09 respectively. The EPS for the same years is 0.96, 1.38, and 1.16 respectively. The company has carried forward loss of Rs 74.40cr as on 31-03-09. The net asset value as on the same date is Rs 3.92. The company has not distributed any dividend in the past.


Although Jubilant are exclusive franchisee of a globally successful brand, known for operational excellence and robust supply chain management, the premium sought appears to be on the very high side considering its lackluster financial performance.


The Master Franchise Agreement confers certain rights on Domino’s International and requires Jubilant to seek the approval of Domino’s International in certain circumstances including choosing suppliers to open any store. Jubilant lacks operational freedom.

Jubilant faces stiff competition from organized and as well un organized sector. The going for the company may not be easy in Nepal, Bangladesh and SriLanka,where the company intends to expand its operations.

Fast Food is not at all conducive towards maintaining a balanced diet and an increased consumption of the same is linked to serious health hazards like obesity and development of chronic diseases. Fast food contradictorily has a popular taste, as it is high in fat and sugar content. Due to the addition of preservatives, these types of foods also have typically high sodium content.


The brand name is exciting but the fundamentals and business prospects are not so. It will take couple of years, for the company, to completely wipe out the losses and come to dividend list. Ultimately, the company’s business prospects and bottom line that determines the share price movement in the stock market and not the brand equity alone. The issue is very aggressively priced. Avoid subscription.

Monday, January 11, 2010


The Yash Birla group, Mumbai based, BSE listed Birla Shloka Edutec has come up with follow on offer to fund its expansion plans. The company proposes to raise Rs 34.80 cr by issue of equity shares of Rs 10/- each in the price band of Rs 45-50. Issue opens on 11-01-10 and closes on 13-01-10. Ashika Capital Limited are the Book Running Lead Manager.

The group has diversified interest in industries, among others, steel pipes, machine tools, property development, cotton ginning etc. The major companies in the group include Zenith Birla (India) Ltd, Birla Power Solutions Ltd, Dagger Forst Tools Ltd, Birla Precision Technologies Ltd , Birla Transasia Carpets Ltd, Birla Perucchini Ltd, Birla Electricals Ltd, Birla Lifestyle Ltd, Birla Concepts (India) Pvt. Ltd,

Birla Shloka operates in education sector. It provides multimedia based educational products to governments and private institutions in the country. The company has very limited presence in the sector. The company has bid for the contract floated by Maharastra and Madya Pradesh governments.


The funds raised are intended to be utilized for Turnkey projects to be executed by the company under the BOOT model, for up gradation of infrastructure and content development for XL@School (an audiovisual soft ware product) and for working capital requirement.


The company reported a turn over of Rs 39.17cr and Rs 104.00 cr for the years 07-08 and 08-09 respectively. The net profit earned were Rs0.38cr and Rs0.31cr for the above periods. Major portion of the revenue has come from trading in computer hardware and soft ware and hence the margins are very low.


1.The company had negative cash flow in the last five years.
2.Birla Bombay Limited –one of the group companies appears in the RBI defaulters list.
3.Book value of share as on 31-03-09 is Rs 11.75.
4.Not so impressive performance of listed companies of the group in the Stock Exchanges.

Education is a priority sector for the government and lot of reforms are expected in the coming days. There are plenty of opportunities for the companies with right business model.


Considering the un impressive track record of this company and that of group companies as well, investors are advised to stay away from the issue.

Sunday, January 10, 2010


The Bengaluru based, IT service provider is entering the capital markets with initial public offer of 1,15,03,000 equity shares of Rs 10 each, consisting of fresh issue of 57,33,600 shares and offer for sale of 57,69,400 shares in the price band of Rs 155 – 165. The issue will open on 11-01-10 and closes on 13-01-10. The issue would constitute 26.17% 0f the post issue paid up capital. SPA Merchant Bankers limited and IIFL are the BRLMs.

The company is promoted by Sanjay Govil and associates. Infinite derives major portion of its revenue from Telecom and Health care sectors. The company has global presence and has been increasing the geographical footprint in an aggressive manner. Infinite has established presence in most of the large Telecom & IT Services markets of the World with offices in the U.S. UK, India, Singapore, Malaysia and China. The company has three development centers in India - in Bangalore, Chennai & Hyderabad. The company’s main campus is located in Whitefield, Bangalore, in an area of approx. 4.48 acres. The key clients of Infinite include Verizon, IBM, GE, AOL, ACS and Alcatel Lucent.


The company intends to utilize the issue proceeds, among others, for acquisitions and expansion of facilities at Gurgoan. However, the project has not been appraised by any Bank/ Financial Institutions.


For the year 2008-09, the company reported a net profit of Rs 457 million on a turnover of Rs 4,900 million, translating to a net margin of 9.3 per cent. It posted an EPS of Rs 11.96 during the same period, while its book value per share stood at Rs 29.10. Infinite’s return on capital employed (ROCE) and return on equity (ROE) for the year stood at 48.0 per cent and 50.5 per cent, respectively.

The EPS for FY10E on post-IPO fully diluted equity works out to Rs 16. At the offer price band of Rs 155-165, the IPO is available at almost 10x the upper price band of its FY10E annualized post-issue EPS. The stock is reasonably priced from a valuation perspective.


The Company operates in business environment, which is highly competitive with a number of strong players operating in India and overseas. The challenges lies in effectively competing with these global players. The dependence on US, which contributes nearly 90 per cent of the company’s revenues, is a matter for concern.

Infinite derives major portion its revenue from two verticals –Telecom and Health care and top five clients constitute 80 per cent of revenues. These are the two sectors, which are expected to have exponential growth in the coming decade, both in developing countries and as well in developed countries. Having established credibility with the leaders in these sectors one can expect these verticals to contribute significantly to the revenue and as well as to the bottom-line. The health care reforms Bill in US is likely to be cleared in the coming days, which will benefit companies providing low-cost services, like Infinite.


The issue is attractively priced and there is enough scope for further appreciation. APPLY.

Sunday, December 13, 2009


List of forthcoming IPOs.

a. Fineotex Chemical Limited
b. Jaypee Infra tech Limited
c. Jaypee Estates Projects Limited
d. PNC Infra tech Limited
e. Aqua Logistics Limited
f. Everest Infra Energy Limited
g. Intrasoft Technologies Limited
h. Sterlite Energy Limited
i. Vasocn
j. Hathway cables ltd
k. Kumar urban developers ltd
l. Nitesh estates ltd
m. Lodha developers ltd
n. Tarapur Transformers Limited
o. Rural Electrification Corporation Limited

Wednesday, December 9, 2009


D B Corp, one of the leading print media house in the country, publishing 48 newspaper editions, in three languages, in eleven states and which also operates 17 FM radio stations, is entering the capital markets. The public issue consist of 1, 81, 75,000 shares of Rs 10/ each, including the offer for sale of 1, 27, 25000 shares in the price band of Rs 185 -212.

The issue will open on 11-12-09 and closes on 15-12-09. Enam Securities private limited, Citi Corp Markets India private limited and Kotak Mahindra Capital Company limited are the Book Running Lead Managers.

The flagship newspapers of DB Corp are, Dainik Bhaskar, Divya Bhaskar and Saurashtra Samachar, have a combined average daily readership of 15.5 million readers, making them one of the most widely read newspaper groups in the country. The other newspapers are Business Bhaskar, DB Gold and DB Star and, on a franchisee basis, DNA (in Gujarat and Rajasthan). In addition to newspapers, they also publish 5 periodicals, namely, Aha Zindagi, a monthly magazine published in Hindi and Gujarati, Bal Bhaskar, a Hindi magazine for children, Young Bhaskar, a children’s magazine in English and Lakshya, a career magazine in Hindi.


The objects of this Issue are to raise funds for - setting up new publishing units, upgrading existing plant and machinery, enhancing brand image through sales and marketing, reducing existing working capital loans and for prepaying existing term loans.

However, the projects for which the Net Proceeds are intended to be utilized have not been appraised by any bank or financial institution and the costs of the projects are based on the internal estimates of the Company.

07 08 09 (Rs in crores)

Total Income 674.37 862.69 960.98

Net Profit 35.90 69.77 54.81

EPS (In rupees) 3.06 6.01 4.06

The weighted average RoNW was in excess of 30% for the last three years.


Established brands in Indian print media with wide geographical reach. Average fundamentals. Based on FY 2009 EPS, in the price band of Rs 185 -212 the stock is valued around 50 times its earnings, as against the industry average of 28 times. The valuation is very much stretched. The company has no definitive business plans. The promoter group companies have history of de-listing from the Stock Exchanges. Some of the trademarks, logos and copyrights are not registered. The company is unable to disclose information in relation to certain promoter group companies. Promoters and promoter group have equity interests or investments in other entities that offer services that are related to the business of DB Corp.


D B Corp business is dependent on advertising revenue and a reduction in advertising expenditure, loss of advertising customers or inability to attract new customers could have a material adverse affect on the business. The company relies substantially on advertisements revenue. During the financial year ended March 31, 2009, the company derived 75.50% of consolidated income from advertisement income.

According to PWC report, the media growth rate to increase in 2010 to 10.4%, from of about 9% now, as economic conditions are expected to gradually improve. The industry will continue to grow at increasing rate and there will be an overall compounded annual growth rate for the period 2009-13 of 10.5 percent. The report also predicts a healthy growth in all eight segments of entertainment and media industry in next four years (2010 to 2013). These are television, filmed entertainment, print media comprising newspaper and magazine publishing, radio, emerging segments like music, animation, gaming, internet advertising.

The Indian newspaper industry is intensely competitive. In each of the markets, DB Corp faces competition from other newspapers for circulation, readership and advertising. In addition, they may face competition from other forms of media including, television broadcasters, magazines, radio broadcasters and websites. These other forms of media compete with newspapers for advertisement and for the time and attention of readers. The group may also face competition from international media companies as the Government of India has recently liberalized its foreign investment regulations and restrictions applicable to the media sector. Competition for circulation and readership has often resulted in competitors reducing the cover-prices of their newspapers. Furthermore, competition for advertising from newspapers has often resulted in competitors reducing advertising rates or offering price incentives to advertising customers. Such reduction in prices or rates or the introduction of new price incentives could have a material adverse effect on financials.

Circulation and readership of newspapers among readers is an important source of revenue as they significantly influence ad-spend by advertisers and advertising rates. Circulation and readership are dependent on, among other factors, the quality of editorial content and the preferences of readers, the reach of newspapers, and the loyalty of readers to newspapers and ability to successfully establish new locally focused newspapers in new regions. Any failure to meet readers’ preferences, quality content may affect circulation and in turn revenues.
The issue is very unattractively priced. There is nothing left for investors. AVOID SUBSCRIPTION.


The opinions expressed on this site are personal.Apply your own judgment before making investments of any kind. Thank you.

Friday, December 4, 2009


Mumbai based, leading real estate development company, who are one of the top ten builders in the country, is entering the capital markets, to raise around Rs 500 crore, with public issue of 94,29,750 equity shares of Rs 10/- each in the price band of Rs 490 -530. The issue will open on 09-12-09 and close on 12-12-09. ICICI Securities limited, Kotak Mahindra Capital Company, IDFC- SSKI LIMITED and Nomura Financial Advisory Securities Pvt limited are the Book Running Lead Managers to the issue.

The company is promoted by Godrej Industries Limited, which holds around 80% of equity share capital. Godrej Industries Limited is the listed flagship company of the Godrej group, which is one of the leading business conglomerates in the country.

Godrej Group is engaged in diverse business segments, spanning Home appliances, FMCG, Consumer products, Industrial products , Oleo chemicals, Animal feed, Real estate development and Oil palm plantations.

Godrej properties limited (GPL) has real estate development projects in 10 cities in India, which are at various stages of development. Currently, the business focus is on residential, commercial and township developments. GPL is a fully integrated real estate development company involved in all activities associated with the development of residential and commercial real estate.

GPL, as of October 15, 2009, has Land Reserves of 391.04 acres aggregating approximately 82.74 million sq. ft. of Developable Area and 50.21 million sq. ft. of Saleable Area, located in or around prominent and growing cities across India, such as Mumbai, Pune, Bengaluru and Ahmedabad. As on the same date the company has completed a total of 23 projects comprising 16 residential and 7 commercial projects, aggregating approximately 5.13 million sq. ft. of area for development.


The company plans to raise around Rs 500 cr, intends to use Rs 203 cr for acquisition of land development rights for forthcoming projects, Rs 75 cr for construction purposes, Rs 172 cr for repayment of loans and the rest is for general corporate purposes.


The company reported a robust income of Rs 247.38cr, 227.50cr and 137.26cr in the last three years. The profit after tax was Rs 76.62cr, 74.85cr and 28.72cr respectively for the same period. The average RoNW during the same period was around 34%.


GPL is promoted by reputed Godrej group, which has very strong brand equity. Excellent financial track record. Leaders in corporate governance. In the price band of Rs 490-530 the stock is valued at about 40 times of its earning for FY-09. ICRA has awarded grade 4 for the IPO indicating above average fundamentals. The high valuation is justified considering the strong financials, brand equity and future business prospects.


The company’s ability to successfully compete in new segments across different geographies is yet to be demonstrated. Due to general recession, proportion of un-booked space in the on-going commercial projects exposes it to market risks. Further slowdown in real estate segment may affect the demand and resultant decline in property prices. This coupled with oversupply situation in many pockets can affect the prices further, which will have cascading impact on financials.

As per CRISIL estimate, the annual additions in units are expected to grow from 70 million units in 2008 to reach 81 million units in 2014. Estimated annual additions in units in rural areas are to grow from 174 million units in 2008 from 198 million units in 2014. GPL with selective acquisition of land parcels in strategic locations, also enter into development agreements with land owners to acquire development rights to their land in exchange for a pre-determined portion of revenues, profits or developable area generated from the projects. The Godrej brand name and the reputation associated with it contribute in attracting potential joint development partners . This business model enables undertaking more projects without having to invest large amounts of money towards purchasing land. Hence, GPL is able to limit risk through project diversification while maintaining significant management control over our projects. A SURE WINNER FROM THE GODREJ STABLE. APPLY.

Tuesday, November 24, 2009


Jindal group needs no introduction in capital markets. The group has business interest in the steel, power, cement, aluminum, software, power trading and infrastructure sectors.

The power company from the JSW group is planning to raise Rs 2700 cr through IPO, in the price band of Rs 100 - 115 per share, having face value of Rs.10 per share. The issue will open on 07-12-09 and closes on 09-12-09.

JM Financial Consultants Pvt Ltd, Kotak Mahindra Capital Ltd., ICICI Securities Ltd., IDFC-SSKI Ltd., JP Morgan India Ltd., SBI Capital Markets Ltd., Morgan Stanley India Ltd. and IDBI Capital market Services ltd are the book running lead managers to the issue.

JSW Energy limited, is a part of the JSW Group, headed by Mr. Sajjan Jindal.The company currently owns and operates thermal power plants in Karnataka with an aggregate capacity of 860 MW. It also provides operation & maintenance services for power plants of group companies and project management services for the power plants being set up by the group. JSWEL is currently in the process of enhancing its power generation capacity by 2,790 MW. It is also setting up a transmission line network and developing lignite mines through joint ventures.


The funds raised are intended to be used for setting up power plants. Repayment of high cost corporate debts and for general corporate purposes.

The cost of the projects is estimated at Rs.14,048 crore and is being funded in a debt to equity ratio of 2.45:1 i.e. long-term debt of Rs.9,979.50 crore and equity of Rs.4,068.50 crore. The company has already tied up the total debt component while, funds aggregating Rs.5, 982 crore were deployed in the various projects as on June 30, 2009. State Bank of India and ICICI Banks have appraised and funded the projects.


The company had a CAGR in excess of 30%, in revenue generation, in the last three years. Consistently profit making company. Professional and experienced management. Known for good corporate governance. Strong financials. Power plant are located at diverge geographical locations. The issue has been graded by rating agency CARE as Grade 4, indicating above-average fundamentals. The company’s RoNW is at 18% as on 31-03-09. At Rs 100 -115, the issue is very attractively priced. Retail investors are offered a discount of Rs 5/.


On the successful commissioning of the projects, JSWEL would have benefit of the prevailing high merchant tariff for short term. Given the significant power supply deficit in the country and government recognizing the power sector as a key infrastructure sector to be developed to sustain Indian economic growth, prospects for
growth is favorable for companies in the power sector.

One of the established energy company. One of the early entrants in the power trading business. Currently most of the revenue is derived from power generation. The company has the potential to become an integrated power company in the Indian power sector with presence across the value chain.

The low per capita consumption of electric power in India compared to the world average presents a significant potential for sustainable growth in the demand for electric power in India. There is a very big gap between demand and supply, demand being higher. The company is in the right business at the right time. Investors are advised to apply for the issue for both short term and long term appreciation.


Monday, November 23, 2009


The Kolkatta based infrastructure development company is planning to raise around Rs 100 cr through IPO, which is slated to open on 27-11-09 and closes on 01-12-09. The company proposes to issue 57, 00,000 of equity shares of Rs 10/each in the price band of Rs 165-180. Motilal Oswal Investment advisors are the Book Running Lead Manager.

The company is promoted by R G Maheshwari and associates, was originally incorporated as Maheshwari Brothers Limited and subsequently changed its name.

The company is engaged in the construction and maintenance of roads and highways, industrial infrastructure projects, other civil engineering projects for various government bodies and other clients.

The company has a pan India presence and has executed or in the process of execution a number of projects in states of West Bengal, Madhya Pradesh, Maharashtra, Rajasthan, Assam, Uttar Pradesh, Bihar, Delhi Andhra Pradesh, Haryana and Karnataka.

The company has also interest in steel trading and waste management and ready mix concrete business.


The company intends to use the proceeds of the Issue for procurement of capital equipments, investments in joint ventures, for BOT projects, for working capital requirements and for meeting general corporate purposes. However, the project has not been appraised by any Bank or Financial Institution.


The company has recorded robust revenue and profitability in the last three years and has track record of dividend payment. At Rs 165 (lower end), the price earning ratio of 17 is very much on the higher side, compared to the peers of the sector which are available for less than 10 P/E. Certain criminal cases are pending against the company/ its subsidiaries/group companies and income tax (disappropriate income) appeal. Company is heavily dependent on government/government funded projects. The rating agency ICRA has awarded grade 2 indicating below average fundamentals. The premium sought is very much is on the high side, considering the above factors.


Demand for infrastructure services depends mainly on general developmental activities in the country and expenditure levels in the building and infrastructure sectors. The infrastructure services are principally dependent on sustained economic development in the regions in which the company operates. In addition, demand for infrastructure services is largely dependent on government policies relating to infrastructure development and budgetary allocations made by governments for such development, as well as funding provided by international and multilateral development financial institutions for infrastructure projects. Investment by the private sector in infrastructure projects is dependent on the potential returns from such projects, is therefore linked to government policies relating to private sector participation and the sharing of risks, and returns from such projects. A reduction of capital investment in the building or infrastructure sectors for any reason could have a material adverse effect on business, results of operations and financial condition. Instability of economic policies and the political situation in India could adversely affect the fortunes of the Industry. Investors are advised to stay away from the issue.

Sunday, November 15, 2009


One of the leading and oldest recognised service provider in the travel and tourism industry with pan India and global presence in 18 countries is planning to raise around Rs 600 crore through IPO. The company proposes to issue 1,84, 96,640-equity shares of Rs 10/ each, including offer for sale of 30, 46,640 shares in the price band of Rs 316 -330/ share. The issue is slated to open on 18-11-09 and closes on 20-11-09. India Info line limited are the Book Running Lead Manager.

The company caters to the overall travel needs of an Indian and International traveller and it is one of the India’s largest tour and travel operator, which serve as a ‘One Stop Shop’ for all travel and travel related products.

Cox & Kings business are broadly categorised as Leisure Travel, Corporate Travel, Forex and Visa Processing. They also design travel packages for both individuals and groups for their domestic and international leisure travel, as travel arrangements for corporate clients to cater to their business meetings, conferences and events. They also provide end-to-end travel solutions including land, air and cruise bookings, hotel bookings, in-transit arrangements, local sightseeing, visa, passport and medical insurance assistance. The company continuously innovates product offerings with the flexibility to meet the changing needs of the customers and to address their needs better.


The proceeds of the IPO are intended to be deployed for acquisitions, investments in overseas subsidiaries, repayment of loans and for general corporate purposes.


Taking into consideration the company’s strong brand equity, efficient management, wide range of products, geographical reach, investment in technology and financial performances, the issue can be considered very attractively priced. The rating agency CARE has assigned Grade 4, indicating above average fundamentals. At Rs 316-330, the price-to-earning ratio is around 16 multiple based on the average weighted EPS of Rs 22.00 for the last three years, as against the average industry PE multiple of 36. There is enough scope for further appreciation.


The company operates in a highly competitive market and hence faces stiff competition from other players operating in this sector as also from the un-organized sectors. Many Indian and foreign players have entered the market both in the online and offline space. Pricing is one of the key factors that play an important role in customers’ selection of products. There are several strategies adopted by competitors to increase their market share through advertising, pricing, service, new product innovations and distribution reach amongst others. This increased competition by both traditional and new players is likely to affect margins. However, this could stand mitigated by the the brand equity and the trust it has earned over the years. The company appears well poised to face the challenges and emerge a winner. This is one of the public issues that the investors can apply and look for positive returns.

Tuesday, November 10, 2009


The unruly behavior of the MNS legislators (Goonda Raj HT 10-11-09) in the assembly during the oath taking ceremony on 09-11-09, in assaulting the SP MLA for taking oath in Hindi is a shameful act. There are many peaceful ways to express one’s views on a subject. These kinds of behavior indicate how immature one is. Earlier, the same Samajawadi party MLA had made a ridiculous demand, that the business agenda of the Assembly should be made available in Hindi. He has chosen Maharastra for his political career and the people of the state have been magnanimous enough to elect him to the Assembly from two places. Propriety demands learning/acquiring working knowledge of Marathi language even before contesting the election. He should have respected the public sentiments and taken oath in Marathi. Being an elected representative, it is beyond anyone’s understanding as to how Azmi is going to inter act with the people of his constituency. Voters should take note of the above acts of immaturity, by both the sides, while excersing their franchise in future.

Tuesday, November 3, 2009


The views expressed by Parsa Venkateshwar Rao Jr in the article’ Indira Gandhi was merely a politician’(DNA 03-11-09) is not correct. She had all the qualities of a very strong, great leader. Bank nationalization, Pokaran nuclear test, Garibi hatav programme, Right of ownership to the tiller, the win against Pakistan in 1971 war, are some of the feathers in her cap. She was the true leader who knew the pulse of the voters. Her strong leadership qualities when in power and out of it was hailed in India as well outside the country. Although there were some drawback in her style of functioning, it is wrong to attribute the same as lack leadership. Politics is a different ball game. One has to deal with the elected representative whether they are educated or not, whether they understands host of other things of efficient administration. Even today, it is difficult attract talented people for various (obvious) reasons for any political party. The assertion that she lacked the ability to build a team of talented people is again not correct. Contrary to the views expressed in the article, undoubtedly Indira Gandhi was one of the greatest leader India has produced and not merely a politician.

Monday, November 2, 2009


The not so formidable bowling attack of Australia defended the modest score of 250 runs on a good batting pitch. The all-round display by Shane Watson helped the Aussies to win the Mohali match. India started well, Sewag hitting the ball to all parts of the ground. As it happens most of the time, he did not lost long. Master blaster, Tendulkar, was shaping his innings well. Cricket fans were hoping that he would cross the all-important milestone of scoring 17000 runs in ODI. However, a wrong decision by the umpire (as confirmed by the television reply) adjudging him as out, to a ball which was pitched outside the leg stump, turned out be the turning point of the match. After that, India lost wickets at regular intervals and the run rate started climbing. Harbhajan Singh did his best. That was not good enough for India. He and Praveen Kumar have demonstrated in this series so far, that they have the potential to become genuine all rounders. The team management should take note this and utilize their batting potential to the maximum in the overall interest of the team India.


The patriarch of CPM, the man who holds the record, for occupying the post chief minister for highest number of years in the history of Indian democracy, is desperate to save his party, in the coming assembly by polls. Basu has sought the support of traditional Congress voters to fight the Trinamool Congress. What an irony. The man, who fought against the party his entire life, is seeking the votes of the supporters of the same party. The reason being that the LEFT gave unconditional support at the center to counter the threat of communalism. The people of the state/country are also aware that the bottleneck they created for various developmental programmes and for reforms, the UPA government wanted to implement sincerely. Moreover, for the same reason that the LEFT were routed out in the previous Lok Sabha election. Since then there is no change its programme, policies and ideology. Hence, on what basis Basu is seeking the support of Congress voters is perplexing. It appears, writing on the wall, for LEFT is very clear. As a seasoned politician, he can read very early and clearly than others can.

Sunday, November 1, 2009


First time in the history of Indian democracy, a sitting Loksabha member is to be prosecuted under the Prevention of Money Laundering, Act (PMLA). (TOI 01-11-09). The MP in question is, Madhu Koda, an independent from Jharkand. The I T department conducted nationwide raids on 60 premises belonging to him/his associates for diversion of funds to the extent of Rs800 crore during tenure as chief minister of the state. Whoever is responsible for this initiative/action against a politician should be congratulated. At least a beginning has been made to weed out corruption in politics. Politics as a profession pays you nothing. Then, why are most of our politicians crorepathis. Unless they are corrupt (barring exception) and pursue unethical ways to amass wealth this cannot happen. There are big fishes in other political parties, including the Congress, who have amassed wealth much against their known sources of income, by virtue of being in politics or being close to a leading politician. It is universal truth that most politicians spend 20-25 times more than the limit fixed by Election Commission while fighting an election. There are loopholes in the system and they easily escape being caught. Will the establishment responsible for action against Madhu Koda initiate similar action against other corrupt politicians in the country. Otherwise, one would presume that action against Madhu Koda is a political stunt ahead of assembly election in the state or he is being singled out because he does not belong to any major national/regional political party.


Aussies lackluster batting performance in Kotla ground is responsible for their second consecutive defeat against India. Ponting was surely missing the services of Gilchrist, Mathew Hayden and Andrew Symonds, the all time big, awesome, hitters in the game. These players were capable of taking any bowling attack head-on and single handedly win matches for their side. After winning the toss, Ponting elected to bat and opened the innings with Watson. Both struggled to score runs at a brisk rate. Ponting was more cautious, aware the absence of big hitters in the side. The average per over score was around four runs, until the 40th over. One expected the firework in the last ten overs. However, nothing happened. The final score of 220 odd runs was never a tough target for the strong batting line-up of India. Dhoni and Yuvraj played sensibly and India had no difficulty in reaching the target. Its good, India won the match. However, the real action was missing. Long live the phenomenal hitters.


The agro chemical and pharmaceutical company is planning to raise Rs 61.50 cr through IPO. The company proposes to issue 75, 00,000 of equity shares of Rs 10 each at a premium of Rs 82.00. The issue will open on 29-10-09 and closes on 04-11-09. ALMONDZ GLOBAL SECURITIES LIMITED are the Book Running Lead Manager.

The company is promoted by Ashok Hiremath and Dr.P.L. Tiwari.

The company under the Agrochemical segment, manufactures active ingredients, intermediates and formulations. Active ingredients are sold to crop protection formulators. Intermediates are supplied to technical grade product manufacturers. Formulations are sold in bulk quantities to companies engaged in retail marketing.

Under the Pharmaceutical segment, our Company carries out manufacturing of intermediates which are supplied to Active Pharma Ingredients manufacturers.

Objects of the Issue

1. Expansion of existing manufacturing facilities.
2. Expansion of existing Research and Development facility.
3. Meeting long-term working capital requirements.
4. General Corporate Purposes.

FINANCIALS: 08-09 07-08 06-07 (Rs in lacs)

Total Income 6,120.78 9,388.07 2,750.59

Net Profit after tax 793.52 1,072.78 342.86


• Scale of operations is very small.
• There is delay in execution of expansion capacity.
• Minimal global presence.
• Expansion project is funded entirely through equity.
• The company faces unresolved litigation, which could pose risks to its operations. Nath Biogene, a former customer, has alleged supply of spurious products by the company; which Astec has disputed.


In the price band of Rs 77-82, the offer price discounts the company’s 2008-09 earnings by 12 times, on the expanded equity.

The larger listed peers in the sector — Meghmani Organics and Sabero Organics — are available for less than 6 P/E. AVOID SUBSCRIPTION.


The party with a difference, much disciplined, development oriented and cadre based party’s image in Karnataka is in shambles because of indiscipline, infighting and most important lust for power. The state is reeling under un precedented havoc caused by the floods, the elected representatives of BJP for fighting in the streets to fulfill their personal agenda. More intriguing was, while addressing the press conference after his return from ‘Kukke subramaya’ C M Yediyurappa asserted that all his colleagues, MLAs are working overtime to help the people affected in flood affected districts. To the astonishment of viewers, this statement comes when nearly 60 dissident MLAs are locked at Hotels in Andhra Pradesh and Goa, enjoying their free/sponsored holidays. The inorganic growth of BJP in Karnataka is one of the major contributors for party’s indiscipline and dissidence. With the sole intention of winning elections, if people who do not believe in the ideology, policies and programmes are admitted to the party, the current situation is bound to happen. Although the present C M does not have much experience, he has done reasonably well in all fronts. One does not know the real demands of Reddy brothers. The M P from south Bangalore, who was once calling the shots in Karnataka’s BJP affairs is watching the entire ‘drama’ as mute spectator. The central leadership may work-out a compromise formula and solder the relationship between the warring Reddy brothers and the C M, but any such relationship will not be strong.

Thursday, October 29, 2009


The startling revelation by the one of the greatest of player of tennis, that he was using recreational drug, crystal methamphetamine, popularly known as ‘speed’ in hey days, has shocked the tennis fans across the world. More startling was, that the governing body of ATP relied on the statement of Agassi overlooking the findings of the doctor in the drug test. The ATP should strip all the titles won by Agassi, ban him for life from associating himself with tennis any capacity. No one is bigger than the game.

Wednesday, October 28, 2009


Ricky Ponting, after winning the all important toss, chose to field first on a placid, high scoring pitch in Nagpur for surprise of every one. Knowing that the services of his prime strike bowler are not available, one wonders what made Ponting to field first on an excellent batting pitch. Expect for getting the wicket of Tendulkar early, nothing went right for Assies. Indian batsmen scored runs at will. Suresh Raina and Sewag contributed runs at very good strike rate. Dhoni led the team from front and scored a match winning century. Chasing 350 odd runs by any team on any pitch is not easy. Assies lost wickets in quick session. There were no partnerships. There was need for a cameo innings from some one like M.Jhonsen. Ahead of him Ponting sent the inexperienced Voges, Shuan Marsh, knowing well the cameo innings Jhonsen is capable of. He was sent in after the fall of five wickets, with only 12-13 over remaining to do the impossible. It appears Ponting wrong judgment might have cost them the match.


For the forthcoming election in Jharkhand, scheduled for December, the Congress should choose its ally carefully. Leaders with criminal records and leaders with charges of corruption should be kept out of pre-poll alliance/any alliance. Voters are interested in good governance, stability, communal harmony and development. Jharkand which is in rich in natural resources is one of the most backward states in the country. However, the previous governments, for various reasons could not exploit this strength to the maximum, developmental activities were minimal. A strong, stable government with focus on development will take the state to greater heights. The situation is tailor made for Congress.


The RSS chief Mohan Bhagwat is right in suggesting that BJP needs either surgery or chemotherapy and they themselves should decide what they need (DNA 28-10-09). I think BJP needs both, for complete over haul and image make over. The performance of the party under the leadership of Rajnath Singh as the party president is very un impressive. The party has lost miserably in the Lok Sahha elections and its performance in the three states that went election this month is lackluster. The party’s image took a severe beating in Jaswant Singh episode. The internal bickering, indiscipline (Raje’s defiance in Rajasthan and Reddy brothers’ behavior in Karnataka, among others) makes mockery of the so called cadre based and disciplined party, a laughing stock. Rajnath Singh remarked Bhawat’s suggestion as mad. Only time will who is mad. But there is urgent need for change of the leadership at the highest level with people who are young, dynamic and has vision to attract the masses.

Tuesday, October 27, 2009


The RBI, in its credit policy review, has increased the requirement of SLR by 100 basis point to 25%. The other key rates, including CRR, REPO and reserve REPO rates kept unchanged. The RBI has rightly tightened the provisioning norms for NPAs. The reality sector which was expecting some favorable policy decision been disappointed. This kind of independent, pragmatic policy measures taken by RBI has saved the country from financial melt down as experienced by some Western countries during the last year. And it so no surprise that RBI has been hailed as one the best regulator in the world.


Appeared in DNA Mumbai on 28-10-09.

The allegation by Pakistan’s interior minister Rehman Malik that India is funding Taliban (DNA 27-10-09) is a joke. The whole world knows that the Taliban is creation of establishment in Pak to wage proxy war against India. It is continuously nurtured and funded by the successive governments of Pak. When things are going out of control, (the recent series of bomb attacks by extremists there) the Establishment has chosen the wildest improbable to blame India for existence of Taliban.


Cricket fans love Gilchrist. The way he demolishes the bowlers of his opposite side. The way he can single handedly win matches and the way he can bring victory from the jaws of defeat for his side. The gentlemanly behavior on the field. That is cricket. But his assertion in Pune that OZ is still safe for students is not correct. He has termed the incidents as generic and could happen anywhere. The problem is not generic, it is the attitude and mind set of the people. The series of racial attacks on Indian students in Australia are appalling to say, the least. The students have been attacked without any provocation. It is indication of growing frustration and non-tolerant attitude of Australians against India which is emerging as a powerful economy. Equal or number of Indian students go to USA for studies. No such problems in America. As good will ambassadors, Australian cricketers must put pressure on their government to take preventive action in this respect. Advice to Indian students – chose Australia as a lost resort for higher education, since some of the Universities there are fake and it is an unsafe destination.

Friday, October 23, 2009


Contrary to the expectations of Shiv Sena and BJP, Raj’s MNS has performed remarkably in the recently concluded assembly elections in Maharastra. MNS has made strong in roads into the Sena bastions in the cities of Mumbai, Thana, Nashik and Pune. Apart from securing 13 seats they came second and third in many constituencies. Again this is a very credible performance for a three year old party. Raj Thackeray has the knack of connecting himself with the voters, particularly the young ones who matter most in the elections. His party promises to solve the problem related to migration, slum rehabilitation, power shortage, encroachment and host of other civic problems. MNS appears to be sincere in finding solutions to the above perennial problems. MNS is likely to be a major player in Maharastra politics in the years to come. Considering the progress they have achieved in a very short period, they are likely to garner lion’s share of seats in the Municipal/Civic elections in the above cities, as and when election are held. And it will not be a surprise if they emerge as a major opposition party/power player in the 2014 assembly elections.



Den networks limited is entering the capital market with public issue of 20,000,000 equity shares of Rs10 each in the price band of Rs 195-205. The company intends to raise around Rs 400 crores from the issue. The issue is slated to open on 28-10-09 and closes on 30-10-09. Deutsche Equities India and Antique Capital markets are the BRLMs.

The company is promoted by Sameer Manchanda and Lucid systems pvt. Limited.
The funds raised will be utilized for company’s cable television and infrastructure services, for acquisition of content and broad casting rights and for general purposes including part repayment of existing loans. The project has not been appraised by any bank or financial institution.

The company’s revenue growth heavily dependent on conversion of analog cable subscribers to become digital cable subscribers, in the highly competitive Television distribution industry. Also the company has limited experience in Broad band cable internet services, the other segment which it is interested.

The company has no track record of profitability, dividend payment. It has reported losses for the years 2008 and 2009 and had negative cash flows. The company also is heavily indebted.The average cost of acquisition of shares by promoters - Lucid systms and Sameer Manchanda is Rs 0.40 and Rs 8.80 respectively.

Neither the company’s past track record nor future business prospects justifies the very high premium on shares.



Vinod Kambli has lost the assembly election from Vikhroli, Mumbai. He has lost his deposit too. Unlike his peers N S Siddhu, Mohd. Azaruddin, KAMBLI chose a wrong party to make his political debut. Very few know his party –Lok Bharati.Party and symbol are most important in an election. He is not that popular like SHARUKH KHAN, AMITAB OR SACHIN TENDULKAR to contest on any party ticket and get elected. Politics is a long term game. If he is serious about his chosen line, he should connect himself with the voters of his constituency and work sincerely in finding solutions to the chronic problems faced by the citizens of the constituency. He should try to associate with a national or a strong local party and try to build his political career slowly.

Thursday, October 22, 2009


While expressing my views on Tiger Tales (DNA 01-10-09)I had predicted that the Congress-NCP will come back to power on TINA factor and MNS will emerge even stronger. The prediction has come true. The views expressed on 01-10-09 is hereby re-published.

Thursday, October 1, 2009
Interesting analysis of forthcoming assembly election of Maharstra by R.Jaganathan. (DNA Tiger Tales - 01-10-09) Although the performance of the DF government is lack luster, these combinations, again may come back to power on TINA factor. The BJP in the state is rudderless, Shiv Sena is steadily losing grounds because of split and infighting. The so called Third Front is a non starter. The MNS is making strong in roads into erstwhile Sena bastons. The Center’s rural unemployment guarantee scheme, farmers’ loan waiver and other initiatives taken in the field of education, rural health services will fetch substantial votes to Congress-NCP combine. The young voters who constitute nearly 70% of the total voters are interested youth leadership. Here, the Congress (Rahul Gandhi) and MNS has the advantage compared to the other parties. In the changed scenario the MNS will emerge stronger and even may play the role of king maker in the unlikely event of a hung assembly.
Posted by K A PRASANNA at 8:28 AM



The reaction of Abbas Naqvi, senior leader of BJP to the out come of results of assembly results of the three states terming EVMs as electronic victory machines for Congress is unfortunate. It appears that statement has come out of sheer frustration. The BJP, as expected had fared very badly in the election because of loss of image at the national level, infighting and lack of leadership at state level. Instead of accepting the defeat gracefully and introspect on the same our BJP leader has chosen the blame the EVMs.Modi in Gujarat, Chauvan in M P and B S Yediyurappa in Karnataka all rode back to power and the same EVMs were used in those elections also. Why Naqvi did not raised this issue at that time. People of this country are not that fools to buy his story.
It is time for BJP to re-think on its programme, policies, ideology and strategy if it wants stay as an alternative to the Congress party.

Wednesday, October 21, 2009


The fighting between Ambani brothers has been termed by the country’s apex court as countries at war. Here is a poser to Ambanis – Had there been no split in the family, whether Mukesh’s RIL still had taken the same decision of increasing the gas price from $ 2.34 per mmbtu to $ 4.20 per mmbtu for supply of gas to RNRL and whether Anil would have opposed the move as he has done now. The answer to both, probably – no. Then what is that they are fighting. Their respective counsels should enlighten the public and the share holders of the above companies in this regard.


The detention of Parvez Rasool, cricketer from J and K by Bengaluru city police has made out as over-zealousness and incompetence. (DNA 21-10-09 Nano edit - Not cricket at all) The track records of Bengaluru police in nabbing terrorists are excellent. The integrity, sincerity and efficiency of the police force, particularly the present police commissioner Shankar Bidri can not be questioned. It happened because of faulty functioning of the machine or just human failure. There are thousands and thousands of Kashmiris living in the city of Bengaluru and they are not subjected to this kind of detention. Security is a serious issue, and such thing happens in routine check –up and it can happen to any one. One should not read too much into it and blame the entire force as incompetent.


The crime branch of Mumbai police should be congratulated for nabbing M Y Kadam and D Tulaskar who are accused of duping more than 2000 investors of Rs 6 crore plus. ( Duo dupes 2000 investors DNA 21-10-09). Public also should be careful in making investment in ventures that offers very high returns. There are no legally sustainable business models where one can double his investment in just 30 days. If there is one, the promoters will not offer that business model to others. They themselves will invest all the money they can and expand/improve their wealth. Public should check the credentials of such promoters before investing. The crime branch should keep an eye the fraudsters who regularly advertise in leading news papers of such schemes. Prevention is better than the cure. They may take assistance from retired Police/CBI/Bank officials/others to strengthen their net work.