Reliance Communication on Fire ! Opened at Rs 87.10 and touched a High of Rs 100.05 on BSE ! Why were upper circuits revised twice from 2.30 pm !?

Had indicated on April 4,2013 and later in an addendum on April 8,2013 that RCom had little downside and would move up ~ It was Rs 65 on April 8,2013 and touched Rs 100 + inside a fortnight today !

Ambani Brothers seal a Rs 1200 cr deal between two of their Reliance companies~ elder taking advantage of the weaker younger

Wednesday, April 3rd, 2013

Reliance Communication on Fire Today ! Opened at Rs 87.10 and touched a High of Rs 100.05 on BSE ! ~The Share Price simply began zooming past Rs 90 on heavy volumes after 2.30 pm to reach Rs 100.05 on BSE ~ As we close NSE Volumes are near 61 million while BSE Volumes have crossed 17.3 million from under 7 million at 2.30 pm with Average Trading Price over Rs 92 ~ Last Tdae on NSE was at Rs 97.75 and on BSE at Rs 97.45

Don’t Chase the Story and Play the Game where the remote control is not held by you ! !

But why were upper circuits revised twice from 2.30 pm !? ~ to facilitate further heavy buying and raising price by Insiders ! ? or to give a chance for exit to those who had shorted !? ~ On  inquiring with the BSE Surveillance Department why the Circuits were revised twice after 2.30 pm first from Rs 94 to Rs 99 and then to Rs 103.30 after 2.30 pm ,the guy gave this reason ” because RCom is in F & O there are no circuits !” and on conveying fear that there was clear indication of Insider Trading  with orchestrated heavy abnormal buying from 2.30 pm this is what he exclaimed and disconnected ” No ! No! This is all I can tell you!”

Exchanges and SEBI need to investigate…..

Clearly Insiders were at play ! ~ probably they  know of a Deal that has happened but yet has to be announced (Read RCom notification to BSE below) ~ They had already began the Integration of Reliance and RCom Teams a year ago before they actually made the announcement for ‘Jio’ as linked above

BSE Website shows this post at 8.18 am this morning

Reliance Communications Ltd has informed BSE that:

“We note recent reports in the press and confirm that Samena Capital, in a proposed Consortium with certain other global PE funds, is at an advanced stage of the process of due diligence and completion of definitive documents in relation to the acquisition of Reliance Globalcom Ltd., our global communications services business unit.

The intended time line for completion is end of May 2013.

At this point, there can be no certainty that this will lead to a transaction. A further announcement will be made in due course, if and when appropriate.

RCOM and Samena Capital are no longer in discussions with Batelco for the purposes of the above transaction.” read more

Ambani Brothers seal a Rs 1200 cr deal between two of their Reliance companies~ elder taking advantage of the weaker younger

Ambani Brothers seal a Rs 1200 cr deal ~ elder taking advantage of the weaker younger

This is how I see it !

What is Anil Ambani’s Reliance Communications (RC) getting from Mukesh Ambani’s Reliance Jio Infocom (RJI)other than Rs 1200 as a one time upfront payment to use the former’s 120000 route km fibre optic cable network to role out the latter’s 4G Plans !?

Ah! the Promise that RC can in the future also use the fibre optic network of RJI when build ~ like I can stay in your house now and I promise you can stay in mine if and when I build it !

RC has been under the scanner for it’s role in the 2G Telcom Scam and the Debt Overhang of Rs 37000+ crs is adding to the Valuation woes with the Share Price @ Rs 64 against a FY 12 Book  of @ Rs 178

RC has been trying in vain to sell it’s Telecom Tower Business to reduce debt ~ it’s likely that Big Brother may come to the rescue here too !  ~ It’s not getting the price of Rs 30000 crs + it wants for the 50000 Towers Infrastructure ~ It now is ready to rent it at significantly below market rates just to improve cash flows

Clearly Mukesh Ambani’s Reliance Group is a winner in the deal ~ but cannot confirm this for Anil Ambani’s RC as I feel he has simply negotiated weakly from a position of weakness ~ the upfront payment of Rs 1200 crs hardly dents the huge debt  ~some time ago it was negotiating a deal for Rs 10000 crs with Etilisat for Connectivity and for Tower Rentals and that too for a Definite Period ! ~ Why could it not negotiate the same with RJI !? ~ those cash flows would have helped reduce debt significantly

Of course ,however, if the Towers are sold for Rs 25000 crs,now that would spark some real life into RC !

Methinks RC should finally be sold off to the Big Brother Group ! ~ now that would be breaking news and RC would race from Rs 64 towards it’s Book Value of Rs 178 ! ~ that’s if the book value is established as genuine ! and Big Brother pays for the  2G and 3G GSM and CDMA Telecom Licenses capitalised by RC~ FY 12 shows a Consolidated Networth of Rs 36721 crs with Equity of Rs 1032 crs of FV Rs 5 and a Total Long Term Debt of Rs 32705 crs ~ This Total Capital Employed of @ Rs 70000 crs is matched by Net Block of Rs 71478 crs of which Tangibles  are Rs 43551 crs (incl Plant & Machinery of Rs 41163 crs) and Intangibles are Rs 22901 crs  which largely is the Entry Fee for  Telecom Licences of Rs 22386 crs (Gross Rs 28047 crs) ~ Capital WIP is Rs 5026 crs read more

Investors in Power Stocks like Reliance Power and Adani Power Blasted Twice Over !

The Sad Reality is that Investors in Power  Generation Stocks,particularly Reliance Power and Adani Power have just been Blasted twice over

~ on one hand,a macro risk beyond their control,  they are seeing their Electricity Bills zoom without actual increase in number of Units consumed as Power Prices hit the roof 

&

~on the other hand, a micro risk they could have avoided,they are seeing their Investments in these Power Stocks going “Poof” as they have eroded dangerously in value

What Happened to India’s Power Industry that was the darling just a few years ago ! and saw the likes of Reliance Power (RPL) and Adani Power (APL) shamelessly exploit Investors with hugely  out priced and obscene Big Ticket IPOs !?~ RPL asked us for Rs 450 per share and APL for Rs 100 a share ~ and we suckers gave it to them ! while Promoters actually subscribed to nearly all their controlling stake at par Value of just Rs 10 ! ~ Today we cry for being suckered seeing RPL sink to Rs 88 and APL to Rs 42 ! 

The Power Sector Woes lie in the huge spiralling  cost of Imported  Thermal Coal  from Indonesia.In October 2011  Indonesia actually ripped the Indian Power Industry apart by changing it’s Coal pricing Method and aligning prices to international levels and  significantly imposing Coal Exports Restrictions and Increasing Royalties on Coal Mining and Taxes on Coal Exports and in fact even announcing banning Exports by 2014

Thermal Coal Feed Power Plants are simply unviable now if Power Prices continue to be regulated heavily and full costs are not passed on to the Consumer~ However despite Regulation,Inevitably Electricity is going to cost More and More

In July and August 2009 I had blogged comprehensively on the Adani Power (APL) IPO at Rs 100 after thoroughly reviewing it’s Prospectus  ~ It had entered into 15 year Coal Supply Contract at even then a low US $ 36/t with its parent Adani Enterprise (AEL) ~ AEL in turn was to import the Coal from it’s Bunyi Mines in Indonesia ~ The Price of Coal has shot up nearly  three times from this level of the contracted US $ 36 to levels of US $ 100 ~ in 2010 APL was introduced into F & O and was Rs 125 then ~ Today it has sunk to a low of  Rs 42 (FV Rs 10)

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

Thursday, August 20th, 2009 IPO of Adani Power at top end Rs 100….Aggressive Pricing makes it an Aggressive Investment

Saturday, July 25th, 2009

 

APL had stated Coal Supply from AEL as a Risk Factor in the Prospectus ~ it has played up as the major risk factor ~ in fact it’s become a survival factor for APL ~ I had commented in my above 2009 blogs and responses to them on this risk voicing a suspicion that the contracted US $ 36 was a low price even at the time for coal read more

In the Right Direction ~ SEBI announces that Insider Trading and Front Running and Fraudulent Practices will not be allowed in applications for Consent Orders…Well Done SEBI ~ Clean Up our Markets so that Promoters no longer Can!

In the Right Direction ~ SEBI announces that Insider Trading  and Front Running and Fraudulent Practices will not be allowed in applications for Consent Orders…Well Done SEBI ~ Clean Up our Markets so that Promoters no longer Can! http://www.financialexpress.com/news/insider-trading-out-of-sebi-norms/953932/

Does this mean No Consent Order for Reliance Industries gigantic Rs 1000 crs + Insider Trading gains in November 2007 !?

Proof Of Insider Trading in RPL…Yet Blind Eye Turned by SEBI

Wednesday, August 6th, 2008

SEBI has thus far rejected Consent Order Overtures from RIL for the above because the Penalty proposed by RIL was too low..Rs 5 crs at first and raised some more later…It was expected that the Penalty would be running into Hundreds of Crores…and to think it would even finance SEBI’s Delhi Standalone Building that they are looking for !

Update on Morning of Monday,May 28,2012

Reliance Industries has moved the Bombay High Court on SEBI’s new Consent Rules….it has urged the High Court to allow it to settle the Insider Trading Issue as above with SEBI on the old Consent Terms Guidelines and Rules 

In January 2011,Anil Ambani and Two of his Companies got away with a Consent Order Fine of Rs 50 crs aggregate for misuse of ECB Funds to the tune of US $ 500 Million

Anil Ambani must breathe a sigh of relief as SEBI passes a consent order for RNRL,Reliance Infra and it’s Directors in a probe involving misuse of ECB funds read more

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

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 !

Reproducing with her permission an email received this morning from a veteran stock market observer for years and a friend on Insider Trading and Market Manipulations

Reproducing with her permission  an email received this morning, from a veteran stock market investor and a keen market observer for years and a friend, venting her feelings on Insider Trading and Market Manipulations in Indian Stock Markets

She is Mayuri…and could teach a thing or two to some fresh “I know it all”  or “I want instant fame and richness” young anchors and reporters who keep popping up on the stock channels and who have no idea of our market legacy as they were not even born then and who get visibly overawed by Promoters and Corporate Honchos who shower their largesse on them in many ways !

I value her market insights as they are well founded …she is currently holidaying in USA and emailed me this morning…..and when I sought her permission to reproduce it on my blog while assuring her of protecting her privacy,this is what she replied :

“u can put my name …no problem rather rise than be a nameless identity” …we need more market voices like Mayuri 

Hi Gaurav


How have u been? Where is the market taking you from here? I am in California and have just heard the case of insider trading case of Raja Rajaratnam a Srilankan , founder of Galleon Hedge Fund found guilty of making 68m . Just coming to mind is the great Indian fund managers who run the mutual fund industry using all the janta money filling their own pockets on the side. Its a known fact that they buy when  they market and sell stories, they buy it first.

So what is the big surprise if Anil Ambani is questioned in the telecom scam? What is the big surprise if his Rcom  was rigged from 160 to 800 now in dumps ? His big time dream Rpower totally powerless after all the hype? How long do we go pardoning greed for business ambition? 

All our education , the years you spend here watching the markets is such a waste if we fail to create investor awareness and cure herd mentality.  We even have TV show anchors involved in insider trading and we all know that, only SEBI sleeps.

Stories hyped, placements at astronomical rates ….stocks crashing  like a pack of cards…I can count stories on my fingertips. List of advisors and so on and so on.

Hope to light a lamp ….somewhere!

Mayuri