Adani Power Rs 127 and NHPC Rs 32….Both in F & O from today….Keep an Eye

Two Power Stocks to watch out for and that may Lighten up for a Brighter Diwali this year…Both also begin F & O Trading from Today

Adani Power at Rs 128…..Private Sector Power Player…..IPO was a year ago at Rs 100 in July/August 2009…so we see a 28% gain already…Permitted Lot in F & O is 2000 shares and the August 2010 Call Option for Strike Price of Rs 130 is quoted @ Rs 3

NHPC at Rs 32…..PSU….IPO was a year ago at Rs 36 in August 2009… we see a drop of over 10%….Permitted Lot Size in F & O is 8000 shares and the August 2010 Call Option for Strike Price of Rs 32.50 is being quoted below Rs 1…so one can take a 8000 shares position for Rs 260000 for a Premium of Rs 8000… end August if NHPC climbs past Rs 33.50 you start making a Profit…or else you stand to lose just Rs 8000…..If you buy 8000 shares of NHPC in the Spot you would have to pay @ Rs 260000….Instead for one month you get a similar leverage by paying just Rs 8000 !….and Government is planning a Mega IPO for PSU Giant Coal India around Diwali this year…..will not look good if another listed last year PSU like NHPC is below it’s IPO Price of Rs 36!

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Adani Power Struggles on Listing today…saves face by closing at Issue price of Rs 100

I had warned you on July 25,2009 that Adani Power (APL) may not have an exciting Listing…Though the grey market Premium of Rs 10 had indicated listing gains……Check out my take on the APL IPO

IPO of Adani Power at top end Rs 100….Aggressive Pricing makes it an Aggressive Investment

It listed today and struggled right through the day to stay above it’s Issue price of Rs 100…Clearly there was some directed Market Making so that it closed at a face saving Rs 100

If the Sensex seeks 13000 on the downside…It’s at 15000 levels today…. as India grapples with a Drought Situation and Rising Fiscal Deficit and Significant reversal of FII Flows in recent days,you can bet APL too will slide below Rs 90

Now watch out for the NHPC Listing in early September ! It was issued at an expensive Rs 36…Government was greedy….but so are the applicants !…Hoodwinked by the Hype,the Issue was heavily oversubscribed..NIB Portion 57 times !…I have bet you’ll get NHPC below Rs 30 shortly after Listing 

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IPO of Adani Power at top end Rs 100….Aggressive Pricing makes it an Aggressive Investment

A few observations on the IPO of Adani Power (APL)

At the Outset

The Flavour of this Season’s Bullish Momentum is the Power Sector and APL’s IPO takes advantage of this by aggressively pricing in the Rs 90-Rs 100 band….Momentum should list APL in positive territory…Rs 110-Rs 120…Grey Market Premium is around Rs 10 and Application Financing Schemes are being put in place by a few Finance Houses,indicating some level of confidence of comfortable oversubscription…Nevertheless,APL should certainly not qualify as an  exciting listing.

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Borrowing against Brands !…Interesting,but Risky area opening out !

For Years ,Brand Valuation has been part of my sessions on Valuation of Equity at BSE and Other Forums….so it was with great Interest that I read the Economic Times Front Page atricle today on ‘Cos flash brands to raise cash’

Strapped for cash,Kingfisher Airlines has managed to Borrow from State Bank of India against it’s Brand of ‘Kingfisher Airlines’ which has been valued at Rs 1900 crs,that’s US $ 391 Million at an Exchange Rate of US $ =Rs 48.50 

Interestingly,Kingfisher Airlines has actually included this Brand Value as an Asset in it’s Balance Sheet…If it had not,then the Debt/Equity ratio would have computed higher….However,It’s probably because the Brand  is shown in the Balance Sheet,that PSU Bank,State Bank of India has been convinced to lend against this Asset

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