IFCI @ Rs 50 today…. up 100 % from Rs 25 inside Two months !… and the % Gains on the F & O Contracts have been four fold at 400% !

IFCI @ Rs 50 today on huge Volumes…. In Absolute terms up 100 % from Rs 25 inside Two months !… and the Gains on the F & O Contracts have been four fold at 400 %….. What a Killing !

One Lakh Shares @ Rs 25 would have meant an Investment of Rs 25 lakhs doubling to Rs 50 Lakhs to give 100% Gains inside Two Months…. and Rs 25 Lakhs Invested as Margin in 50 IFCI Futures Contracts of 8000 shares lot each @ Rs 25 would have given you an Exposure to 400000 Shares…. now that’s a whopping Gain of Rs ONE CRORE or 400% inside Two Months !

IFCI’s Book is Rs 70+… it holds a 4.79% Equity Stake through 24, 42, 212 Equity Shares in MCX which opens it’s IPO Offer for Sale tommorrow in the Price Band of Rs 860 to Rs 1032

Look out for IFCI Merging soon into another Financial PSU…. that’s the Government mindset currently to salvage the Company

…and just think about this…. a leading Technical Analyst was aggressively snubbing IFCI on CNBC and even predicting it will go below Rs 10 !…….. when you don’t blend Intellect with Instinct, this is what will happen !

….I may just give you guys a  hint soon on the Blog for another good Play

…It would be fair to assume that those with a  contrarion and aggressive flair who were in touch with me have benefited from IFCI in the past two months

Cheers !

7 thoughts on “IFCI @ Rs 50 today…. up 100 % from Rs 25 inside Two months !… and the % Gains on the F & O Contracts have been four fold at 400% !

  1. Hi Gaurav,
    If we see big fall in United spirits with anticipated bankruptcy of kingfisher, would that be great long term opprtunity to buy India’s famous spirits brands. I mean how “United Spirit business” and “Kingfisher business” are related??? I see with my NAIVE eyes no relation, but in smart market United spirits shares falling with rumours of kingfisher going bankrupt.

    Regards
    Sameer

  2. Sameer…r u hinting at Shree Renuka !?….I’m with you on the United Spirits wavelength….lets see how it unravels because even in the UB Group Companies the Promoter Stakes are heavily ,read as nearly fully,pledged…the groups has Borrowings inn excess of Rs 15000 crs and this should approach Rs 20000 crs…tongue in cheek,Mallya in drunken stupor is crashing his own companies !…No Longer United and Spirited !…Humpty Dumpty….Wait and Watch !

  3. Stop teasing Sameer !…Memory is clogged with many such Wonderful Scrips and some that yet have to gather steam…need to however move on and not rest on past laurels….Cheers !

    1. Hi Poonam

      Finally the Government has decided,after a Union Cabinet decision,to convert their Loan and Optionallly Convertible Debentures to Equity at Par ~ Such a huge conversion of Rs 923 crs,will more than double the current Equity of Rs 738 crs and explode it to a level of Rs 1661 crs ~ and that too at just par of Rs 10 means Free Reserves remain unaffected at Rs 3576 crs as at March 31,2012 ~ this mathematically impacts the Book Value immediately by lowering it from Rs 58+ levels to just Rs 31 +

      Just last month the long term outlook for IFCI was lowered by a Credit Rating Agency form Stable to Negative ~ IFCI continues to me riddled with Management controversies and run-ins with government and Ministry of Finance ~ it has no real domain expertise or niche in any Operations ~ it boasted of great value over Book of Investments on book in 2007 ~ and this had soared IFCI Share Price to beyond Rs 100 with government looking to bring in a strategic Investor and had even invited bids ~ Corporate Governance Issues and the deliberate non committal stance on the Rs 923 crs conversion then had hassled prospective bidders ~ I remember that the then FM,and who has once again become FM,Mr Chidambaram , boasted that he will revisit the Strategic Investor in IFCI Issue again and get a much higher Price than the lone conditional consortium bid by Sterlite of @ Rs 80 ~ We all know what happened ~ In the intervening years IFCI continues to pay an annual 10% dividend ~ that’s Rs 1 only ,even though it recorded a standalone PAT last year of just under Rs 700 crs giving an EPS close to Rs 9 ~ With the Burst in Equity at par,even the Dividend Paying Capacity will be affected in the future

      Last year,because of the possibility and noises being made of IFCI applying to become a Bank under New Banking Guidelines that were awaited then,the price of IFCI moved past Rs 50 again ~ The New Guidleines cut the Dream by notifying that those who carried on any Capital market Activity could not apply to become a Bank ~ IFCI has a Broking subsidiary ~ IFCI Share Price receded to below Rs 25 before some buoyancy earlier this year ~ At Rs 35 to Rs 40 it yet was traded at just 0.6 to 0.7 P/BV ~ After considering the Conversion of Government Loans and OCD impact ,mathematically at 0.6 P/BV IFCI should sink below Rs 20 ! ~ It currently is traded at Rs 23 to Rs 24 !

      Government is stuck with IFCI ~ I reiterate that the way I see it is that Government has little choice but to merge IFCI with a bigger and more respected Government FI ~ at the time the Share price of IFCI will move towards adjusted Book Value of Rs 31 + currently ~ Question is how soon will the Government listen to me !~ perhaps the conversion is the first step in this process ! ~

      How to play IFCI now? ~ Don’t sell at Rs 23 ~ See it as a Buying Opportunity ? ~ you may want to wait till it falls below Rs 18 unless you’re betting that the merger will be in the short term and bet on it now! ~ I don’t see and major surge in Earnings any soon that normally would guide and Up the Valuation ~ Punters are tired ,as are IFCI Shareholders ~ The extreme Highs and Lows Volatility has unnerved them

      Yet there may be an Opportunity beckoning in IFCI for reason mentioned above ! ~ Assess it well to know the Risks involved

      Cheers !

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