The Hindu Business Line : Sunday, May 18, 2003

Smart money heads for mid-cap stocks
WHERE is the smart money headed? To mid-cap stocks, cutting almost across sectors, it would seem. In April and May, these stocks have gained about 21 per cent. Lakshmi Auto Components, MICO, Sundaram Clayton, Sundaram Brake Linings, Sundram ... More

Tap profits at the right time
MID-CAP stocks delivered attractive returns in the bull phase in the first half of 2002 as well as in the current run-up. But it is important to have the discipline to book profits with targets set for returns. This assumes importance for one ... More

Scare for REC bond investors
THE hunt for higher yields in 2002-03 took investors' money to destinations not seen so far. One such parking slot was the Rural Electrification Corporation bond. It now turns out that the risk involved in these bonds may have been significantly ... More

From unsustainable jumps...
Market on new path of consolidation
STOCK prices may well be weaving patterns, not generally seen in the past. The absence of sharp bullish phases cutting across sectors and stock categories may increasingly become the rule as has been the case for much of the last two years. What ... More

Honda CR-V: Sedan in an SUV
HAVE you wondered about the inspiration behind some of the most cryptic abbreviations suffixed to car names? Many of these are alpha-numeric, difficult to expand and explain, yet they stick in your memory. BMW X5, Nissan NSX, Toyota RAV4, Volvo ... More

It's all war in telecom fare
IT is one more episode in a long-running soap opera that promises to give even Kyunki Saas Bhi Kabhi Bahu Thi on Star Plus a run for its money. No, we are not talking about another of the famed "K" serials from the house of Balaji ... More

OPEN OFFERS

Vickers Systems: Accept
SHAREHOLDERS of Vickers Systems International can accept the cash offer for the simple reason that the financials of the company appear weak. Moreover, Eaton Hydraulics Inc (EHI), which is making the open offer, already holds a substantial ... More

Carbon Specialities: Accept
The manager to the offer, Fortune Financial Services India Ltd, on behalf of the acquirers, Mr Kishore Kumar Kaya and Mr Pankaj Kumar Kaya, is making an open offer to the shareholders of Carbon Specialities Ltd (CSL). The offer is being made to ... More

Alpha Drug: Accept
SHAREHOLDERS of Alpha Drug India (ADI) can consider tendering their shares in the open offer that has been announced by Punjab Chemicals and Pharmaceuticals (PCP) for cash at Rs 5.50 per share. Background While ... More

INVESTMENTS

Beware! High coupons do not mean high returns
YOU may have noticed advertisements from consultants who offer you government bonds that pay interest as high as 11 per cent. Beware! The actual returns on such bonds will be substantially lower. Why? Take a 10-year bond of Rs 100. Suppose the ... More

COURTS/LEGAL ISSUES

CONSUMER PROTECTION ACT
National Commission: Principles, procedures
THE National Commission, under the Consumer Protection Act, has the jurisdiction:

to entertain complaints — where the value of the goods or services and compensation, if any, claimed exceeds Rs 1 crore — and appeals against ... More

MUTUAL FUNDS

UTI Retirement Benefit Plan: Hold/Avoid fresh exposures
FRESH investments in the UTI Retirement Benefit Plan (RBP) can be avoided. The performance of the fund in the past few years has not been impressive. Given the lock-in period of five years and the large exit load applicable for redemptions before ... More

Sundaram Mid-Cap: Hold
INVESTORS in Sundaram Mid-Cap Fund can stay invested as the portfolio has room for further upside. The net asset value is up 9.8 per cent in the last two weeks. A broad-based rally in mid-cap stocks explains the spurt in performance. But any ... More

Reliance Banking Fund: Unattractive
INVESTMENTS in the initial public offer of Reliance Banking Fund need not be considered. Sector funds have generally proved unsuitable for retail investors. Diversified equity funds have also partially taken advantage of particular sector trends ... More

LIC Dhanavarsha 12 — Taking the open-end route
LIC Mutual Fund is to convert the Dhanavarsha-12 into an open-end monthly income plan. Dhanavarsha, a close-end income scheme, was launched in April 1998. The fund has filed with the Securities and Exchange Board of India for approval for the ... More

HDFC Sensex Plus: Hold
INVESTORS in the HDFC Sensex Plus Plan can hold on to their investments in the fund. In the 10 months since launch, the fund has generated significantly higher returns than the BSE Sensex, while investing the ... More

Sniffing out concentrated holdings
MUTUAL funds in India are patronised more by corporate and large investors than by retail investors. But the latter need to be wary of investing in funds that are parking grounds for the former. Investments and pullouts by large investors can ... More

Franklin India Bluechip: Invest

STOCKS

Clariant (India): Pare exposures
INVESTORS holding on to the Clariant India stock may consider paring exposures at the current price of around Rs 145. At this price, the Clariant stock trades at a price-to-earnings multiple of about 8.7 times. During the past 52 weeks, the stock ... More

Restructuring of EID Parry and Coromandel Fertilisers — Hiving off to nurture
EID Parry: Pare exposures
Coromandel Fertilisers: Buy More

Elgi Equipments: A value play
FRESH exposures can be considered in Elgi Equipments at Rs 24. Good export prospects, aggressive approach against its MNC counterparts in the domestic market and foray into value-added products are some of the strategies that might aid the 20 per ... More

Bajaj Auto: Book Profit
REFLECTIVE of the growing competitive pressure in the two-wheeler industry, Bajaj Auto reported a marginal increase in turnover and net profit for the year ended March 2003. Aided by a 6 per cent increase in sales volume, the total income from ... More

Digital GlobalSoft: Pare exposures on uptrend
DIGITAL GlobalSoft's earnings performance for the fourth quarter of 2002-03 reiterates the industry-wide trend of strong volumes but pricing pressure on offshore outsourcing. The salient features of the earnings performance are:

... More

Indian Hotels: Hold on declines
INDIAN Hotels, which runs `The Taj' chain of hotels, has slowly recovered post 9/11 crises. The Budget sops and company initiatives such as restructuring, strategic acquisitions, cost-cutting, renovations and brand-building hold room for ... More

TECHNICAL ANALYSIS

Positive outlook for Orchid Chemicals
THE market sentiment was distinctly positive during the week gone by. While the old-economy stocks provided the initial momentum, the technology heavyweights propped up the indices on Friday. Sensex (3056.58): The Sensex managed to ... More

Bullish trend in ITC and Infy
NIFTY (973.1): As anticipated, the move above 957 imparted bullishness in the index. In line with expectations, the index managed to move to the projected target zone of 960-970. The near-term outlook for the Nifty appears positive. A ... More

Nasdaq: Vacillating movement
EXCEPT for strong upward move on Monday, the price movement in American stock markets remained indecisive. The improved financial performance reported by the corporate sector has imparted bullish undertone. The recovery in the share price of ... More

LIFE INSURANCE

Endowment Plans: Choose one that suits you best
LAST week we discussed a few of the endowment plans available. We also looked at the structuring of bonus payments and riders available. This week we will look at endowment plans structured with some innovative features. Extended ... More

ICICI Pru LifeGuard
LAST week, we looked at a variant of a term plan that returns the premiums if the policyholder survives the policy duration. This week, we will examine a simple term plan from ICICI Prudential. How the plan ... More

STOCK MARKETS

Mid-cap stocks to the fore
JB Chemicals & Pharma (Rs 187): The stock price of JB Chemicals and Pharma surged by a whopping 19.1 per cent this week. This has to be seen in the backdrop of the company's announcement that the US Food and Drug Administration has ... More

Query Box
I am interested to know about Hinduja TMT and how it looks on charts? — Vinay Mathur, Reply: The near-term outlook for Hinduja TMT appears positive. The scrip appears to have the potential to touch Rs 225-230 ... More

DERIVATIVES MARKETS

SBI active; jump in open interest
TRADING activity in the derivatives segment of the NSE was active with the turnover higher by 4.28 per cent. Index futures: As the spot Nifty has been appreciating the whole week, the nifty futures were active. The May future closed at ... More

Delta factor
INVESTORS in the derivatives market are familiar with the word `delta'. The delta measures the sensitivity of the option's price with respect to a small change in the price of the underlying. For a futures position, the value of delta is ... More

DO THE DERIVATIVES
Bullish?... Write Puts
IF you have a bullish view on a stock, there are two ways to cash in on the uptrend. You can either buy calls or write puts (selling the put). By selling a put, the writer has the obligation to purchase the stock at the strike price. If the put ... More

Options guide

FIXED DEPOSITS

IDBI: A creditable option
IDBI's `Suvidha' fixed deposit scheme is open for investment. Income from the deposits is eligible for tax benefit u/s 80L of the IT Act. Senior citizens also get an additional interest rate of 0.5 per cent. An investment up to one-year is ... More

INTERVIEW

`Billing rates to blame for falling margins' — Mr Phaneesh Murthy, Founder of Primentor
Mr Phaneesh Murthy now runs Primentor, a US-based consulting outfit that provides business process-related advisory services. He was earlier the head of global sales at Infosys Technologies. In an interview with Business Line, Mr ... More

INCOME TAX

A capital gains FAQ
IS THERE any exemption on transfer of one residential house and reinvestment in another? Reply Under Section 54, exemption is available on transfer of one residential house and on reinvestment in ... More

Capital Gains: Gift of shares add demat costs
I MAINTAIN an account with a depository in respect of my shares, which are in demat form. The depository charges transaction cost, demat cost and annual maintenance charges. Can these be reduced in computing the capital gain on sale of ... More

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