Union Budget 2013 ~ India is a BLESsed Economy

Felt like a stand up comedian as had the house of 400 well informed investors in splits !  when I address and interacted with them on Budget Day Feb 28 evening itself at a Budget Review Event jointly hosted by AIVF,JITO and the BSE Brokers Forum at KC College Auditorium

Gaurav Parikh on Dias before his Humorous Address to 400 in the audience On Budget Day Feb 28,2013

Covered this on our Company website as below :

SCRIP STANDPOINT ~ A View

Slide Share ~ The Presentation at the Event to support the Address & Interaction

Union Budget 2013 ~ India is a BLESSsed Economy…

Enjoyed on the Budget Day Evening itself Feb 28,2013 addressing and interacting with a well informed audience of 400 on the Union Budget 2013 ~ on how the Government plans to make Money to tackle deficits and how we can ! ~ plan to host a few thoughts of my presentation on the company website www.jsalphaa.com and on this blog ~ covered how FM has cleverly and conveniently balanced the budget ~ also covered  the Forward Trends in Equities &  Indices & Gold & Exchange Rate & how Debts & Deficits are forcing Disinvestments & how the malaise continues on our exchanges and it will be some time before the retail investor comes back,if at all ~ spoke on Liquidity,Sentiment,Momentum and Valuation

Felt more like a Stand Up Comedian as the audience were in splits on some of the budget and stock market situations I presented…

Union Budget 2013 Review Event

L & T Finance up @ 5 % in and out of upper circuit at Rs 87.90 on BSE ! ~ 2011  SS 2 Stock Select at Rs 45 was upgraded to SS 1 Category this year

“Picture abhi baki hai mere dost!”

Sahara Group desperately looking for ‘Sahara’ !

Our Supreme Court has already passed an order that two of the Sahara Group Companies must return Rs 27000 crs to the Investors by November 30,2012 ~ SEBI had refused to accept tonnes of documents in several truckloads  from the Sahara Group and had approached  the Apex Cpurt for complaining against the Sahara Group for contempt of Court in not adhering to the Court Order ~ Last week SEBI and SAT also refused to accept the payorder of Rs 5120 crs prompting Sahara to move the Apex Court for relief and they yet again positioned themselves aggressively against SEBI

The Apex Court simply refused to listed to the Sahara Group’s new appeal ,saying it had no merit ! ~ it also questioned the intentions of the group and said it could send them to Jail but it was more concerned with the Repayments being made to the Common Man who had invested in the Group ~ Leading Lawyers representing the Sahara Group were cut down to size by an exasperated Supreme Court Judge !

Just the Other Day I was really amused at the two full pages of  Explanatory Advertisement in the Times of India by the Sahara Group ~ They claimed they had a healthy Balance Sheet with enough Assets to cover all Liabilities  ! ~ they further even boasted of huge figures of potential earnings from their Property Assets once they are developed !

A Simple Question then to the Sahara Group !

Why don’t you sell off a small part of your Assets & Properties,even in undeveloped stage to pay off Rs 27000 crs to the Investors as directed by the Apex Court ?  

For the sake of countless Investors ,I Hope we are not going to see a Black Hole and another ‘Satyam’ like Story emerging where on stricter examination and due diligence we find the Assets simply don’t match up to the Liabilities !  ~ and that many of the Investors shown on records simply don’t exist !

Clearly Sahara Group was worried that SEBI was making moves to attached their properties…yet, don’t know who advised the Sahara Group first to put out such an ad in the Times of India just before the Supreme Court agreed to hear it’s appeal today ! and second  who drafted and worded it the way it was ! ~ In my humble view this effort to influence will backfire on the group……also what will,is them endorsing cricketers and bollywood celebrities and sponsoring Cricket in a big way ~ One cannot buy Credibility like this !

Sahara Group has to tell the Supreme Court tomorrow whether it can pay Rs 27000 crs inside a week to the Investors….Hope it ‘can’ or else a ‘can’ of worms may just open out !

FCH  now Capital First zooms to Rs 225 + with Warburg Pincus Group as new controlling shareholders at Rs 162 and Biyani out!

Had hinted just ten days ago on the blog to keep a watch

Future Capital Holdings is now Capital First and it zooms to Rs 190 today as Warburg Pincus & Group acquire it from the Biyani Group and other Shareholders at Rs 162!

Monday, November 19th, 2012

Now don’t ask me “Now What!?

2013 should be a good year

Cheers !

Biyani is Out having sold out Future Capital Holdings to the Warburg Pincus Group at Rs 162

Cloverdell Investment Ltd, a private company limited by shares, incorporated under the laws of Mauritius (“Acquirer”) along with Warburg Pincus Private Equity XI, L.P., Warburg Pincus XI Partners, L.P., Warburg Pincus Private Equity XI-B, L.P., WP XI Partners, L.P., each a Delaware limited partnership, and Warburg Pincus Private Equity XI-C, L.P., a Cayman Islands exempted limited partnership, collectively referred to as persons acting in concert (“PAC”) now hold a strong controlling interest of 68.40% or 46794080 Equity Shares of Future Capital Holdings now renamed Capital First

These shares were acquired at Rs 162 as below

Capital First has zoomed to Rs 190 High today and currently at 1.40 pm is available at Rs 186 

Keep an Eye as Capital First is now with Strong Shareholders with proven multibagger success with Bharti Airtel and the likes in the past 

Just to jog your memory ~ Biyani earned the wrath of Investors when FCH failed miserably on the bourses sinking to lows of Rs 130 in recent times from the IPO Pricing of Rs 765 in January 2008 ~ Biyani tried to make amends with an at par Rs 10 IPO of Future Ventures but just about managed subscription ~ it quotes at Rs 9.25 today ~ I had blogged on it at the IPO in April 2011

Biyani’s Future Ventures IPO…First you seduce at an obscene premium…and then now you seduce at Par !

 Cheers for FUTURE !

Yo! L & T Finance Holdings zooms 12.7 % to close at Rs 72.40 today ~ It holds 4.68% of City Union Bank (CUB) which is cum rights Rs 59.75

The market air swirling around to justify this surge is that very soon L & T Finance will get the RBI and government go ahead to increase it’s stake in CUB ~ It holds 19195012 shares or 4.68% of the FV Rs 1 Equity Capital of Rs 40.99 crs as on September 30,2012~CUB has over 80000 shareholders

Interestingly 49 FIIs held 21.86% of the CUB Equity on September 30,2012

CUB is coming out with a rights and employee issue not exceeding Rs 400 crs with record date set at November 23,2012~ The Rights Terms are 1:4 at Rs 20 with 102487972 shares reserved for shareholders with no renunciation right but they could apply for more.The Employee Issue is for a whopping 26500000 shares.The Fresh Issue size is Rs 258 crs

As on 31st March, 2012, CUB had 3347 employees comprising of 47 executives, 1006 officers, 1906 clerks and 388 sub-ordinate staff.

Assuming 3500 employees now,it would mean an average of fresh 7500 shares each in the new issue at Rs 20=> this computes to a gain of @ Rs 32 on the ex rights price of  @ Rs 52 => that’s a cool average gains of Rs 2.40 lakhs per employee

Have a Look at CUB’s Financials ~ it shows a limited downside ~ in fact the 52 week High/Low has been quite robust at Rs 61/39 on BSE

So if L & T Finance is allowed to increase it’s stake in CUB beyond the current ceiling of 5% with an ultimate objective of taking over the Bank,when the RBI Regulation Act is amended and the fresh banking guidelines allows such a takeover,what do you think will be the share price of CUB ex rights !

Interestingly a Broker has downgraded CUB to a Sell from a Buy in it’s November 5,2012 Report ~ Really ! ~ I may just connect with their Director of Research to request them to relook,review and rethink this call ~ they make it at Rs 59 with a target price of Rs 58!

The Idea of this Blogpost is not to rub salt on the wounds but to again expose the twins Greed and Fear that characterize our markets …either the two BRLMs grossly overestimated their own ability or they grossly underestimated the intelligence of Investors or both !

IPO of Samvardhana Motherson Finance Issue closed today grossly undersubscribed...The Two Book Running Lead Managers Standard Chartered Securities (I) Ltd and J P Morgan India Pvt Ltd and the Selling Shareholders seeing this situation have decided this evening not to proceed with this Issue…as if they had any choice in this matter,as even date extension would have not helped the issue succeed !

http://www.bseindia.com/xml-data/corpfiling/AttachHis/Samvardhana_Motherson_Finance_Ltd_040512.pdf

Of 127696518 Equity Shares available for subscription in the book building range of Rs 113 to Rs 118,only 29586650 shares were bid for as below….that’s just a shade over 23% subscription

Bid and Quantity for Samvardhana Motherson Finance Ltd

Cumulative (BSE+NSE)

I’m assuming it was the BRLMs that guided the Company in the IPO Pricing Band of Rs 113 to Rs 118…..if so,they need to be pulled up by the Company for having mislead them for such a high Pricing Band,given the Market Sentiment prevailing ….Such Pricing left nothing on the table for Investors and was largely instrumental in the IPO not succeeding

A Good and Costly Lesson Learnt of the Consequences of  Mispricing IPOs in a Challenging Environment….Samvardhana Motherson Finance should have priced the IPO much lower  in the Rs 75 to Rs 80 band or else awaited better times if they were keen to launch the IPO at higher Pricing like they just unsuccessfully did

When reviewing this Issue and the Prospectus I had found the Pricing high and was skeptical of the IPO sailing through,more so as it was a fairly big issue of over Rs 1500 crs …seems I was right….expect BRLMs to blame Sentiment and not the IPO Pricing for this Failure !

As for the Macro Picture,all those who have been in touch with me or following my blog in the recent past will have sensed why I was not excited and  why I thought 17000 Sensex will break on the downside like it did scaringly today…1.87% and 320 points down to 16831…The Month of May looks ominous for the Markets…so sell and go away in May as they say…take a vacation…if you can afford it though !

Anil Ambani tries to lift Shareholder Spirits…and maybe Share Price too ?!  at the Reliance Cap AGM Today

Bonus and Banking & Insurance Business Stake Sale…that’s what Anil Ambani stated today at the AGM to enthuse all who yet beleive he can surge back to Glory

He’s not really treading any new Path here….Two years ago he said more or less the same at the AGM

A subdued looking Anil Ambani addresses ‘Share Owners’ at the Reliance Capital AGM this morning

Tuesday, July 21st, 2009 

Bonus ?…What diff will this make ?…Equity is Rs 246 crs..Reserves a shade under Rs 8000 crs…Debt is just over Rs 20000 crs….Earnings have been declining…Share Price is under 1.5 Book

In 2009 the Market Cap was more than double of the Rs 10000 crs it is now with Reliance Cap at Rs 900 levels from the current Rs 400

Methinks like methought in 2009 that Anil Ambani can greatly redeem himself by coming out with a Reliance Insurance IPO at Par Rs 10

Cheers !

Your Equity Approach & Strategy will or should depend on whether you want to make money or don’t want to lose any !

So if you are a guy who sweats at falls you ought to be taking less risk and looking at the ‘N’o or Low risk ‘N’s…NHPC @ Rs 25 and NTPC @ Rs 175 

But if you enjoy or indulge in Equities hoping for the windfalls,then perhaps you should chase Delta @ Rs 98…Rakesh Jhunjhunwala increased his stake today in this Jaidev Mody company

However what may interest both set of Investors..those not willing to risk capital or those willing to aggressively risk it…. is L & T Finance Holdings that listed today……Issued at Rs 52,it listed around this price,went up marginally and then slacked to below Rs 50…bounced back up to Rs 51 and then again dropped to close below Rs 50

This is Larsen Groups first Public Offer in nearly 25 years and that too a share with FV of Rs 10 offered at Rs 52 and available below Rs 50 on first day of listing !…..It’s and operation of scale and spreads…. and L & T Finance comes out a winner in both…my valuations for it are strong over One to Three Years….It must be in any and every Investment Portfolio    

Cheers !