SEBI proposes tighter sales practices

India's markets regulator has proposed tightening sales practices by market intermediaries and barred traders from executing transactions that are not explicitly authorised by their clients.
The Securities and Exchange Board of India has proposed that traders not recommend transactions which may be unsuitable, based on clients' financial status and risk appetite, it said in a draft circular on its Web site.
It has also asked traders to ensure their clients are made aware of the nature and risk of the transaction, and have sufficient net worth to bear potential losses.
SEBI has also proposed setting a minimum net worth before allowing clients to trade in derivatives. A net worth certificate from a chartered accountant or income-tax return can be accepted for this purpose, it said.
It has also plans to ask traders not to execute transactions on their own account, before making recommendations on these to clients.
"Procedurally, these could create a lot of hassles. It may just make brokers cautious about the business and not push derivative products to clients," said T. S Harihar, vice-president, derivatives at Karvy Stock Broking.
Thanks to (Reuters)

Handle credit cards with care

I started using Credit card for the past 3 months. It is really a convenient tool if we use it thoughtfully. Today Businessline come out with a interesting article which states that "If you learn to use your card smartly, then the credit card is a boon".
Full article can be accessed at
http://www.thehindubusinessline.com/iw/2008/03/30/stories/2008033050791300.htm

Brokers to give daily margin info to clients

Stock broking firms will have to notify clients about their (the client’s) daily margin positions from April 1, according to a Securities and Exchange Board of India (Sebi) directive. The move follows a spate of complaints from investors that brokers have been liquidating their positions citing insufficient margins, even though their margin accounts had enough funds.The other common complaint is that investors are not aware of the quantum of margin money that had to be deposited to replenish the account. Such complaints could soon become a thing of the past once the new rule is implemented.

During a free fall — as was seen during January 2008 and in May 2006 — brokers promptly square off clients’ positions, at times, it is claimed, not giving them adequate notice. Often, it is alleged, brokers use the funds of their least-preferred clients to meet the margin commitments of their high-volume customers.
“We believe that the digital contract note has to include the margin position from April 1 onwards,” says Angel Broking’s executive director Amit Majumdar. “The software programme needs to be changed so that it goes back to the ledger to pick up the margin position. This might slow down the process resulting in a printing delay,” adds Mr Majumdar who heads the operations, finance and alternate business of the broking outfit.

Brokers will need to disclose this daily
Client code and name, trade day (T)
Total margin deposit up to day T-1 (including break-up in cash, fixed deposit, bank guarantee and securities)
Margin utilized up to the end of day T-1
Margin deposit on day T (including the break-up information)
Margin adjustments for day T
Margin status (balance with the member/due from the client) at the end of day.


The market regulator is of the view that if investors are informed about their margin positions on a daily basis, it would become easier for them to replenish the dwindling margin.

“If informed on a daily basis, investors can see when their margin positions are approaching dangerous levels,” said a source. This would minimise instances of brokerages liquidating client positions for want of margins, he added. This will help investors who trade frequently in the derivatives and/or the cash market and who operate by keeping open positions.

However, there seems to be a slight confusion as to how brokerages will inform their clients about their margin position. While some say the additional information would be made a part of the digital contract note, there are others who say that a separate note (about margin position) would be mailed to all the clients everyday.
Thanks to The Economic Times

Well Researched and timely article : A must read

Company Update: Visa Steel Ltd





Visa Steel Ltd

CMP Rs39

 

We recently met the management of Visa Steel Ltd, a part of the Visa group and returned with a positive view. Visa Steel is a multi-product company with a product portfolio that includes pig iron, sponge iron, coke and chrome concentrates. Visa Steel currently has a capacity of 0.225 mtpa pig iron, 0.3 mtpa sponge iron, 0.4 mtpa coke oven and 50MW of captive power plant. With the new capacities operational and price dynamics remaining positive for the company, we expect Visa Steel's revenue to witness a 44.3% CAGR in top-line and an 88.2% CAGR in PAT over FY07-10.

 

ä       Visa Steel's coke division to add Rs3.4bn in FY09E and Rs4.5bn in FY10E

ä       Revenue to witness a CAGR of 44.3% over FY07-10E

ä       JV with Baosteel, to be beneficial in the long term

 

Click below for the Company Update on Visa Steel Ltd.

http://www.indiainfoline.com/content/rep/Investment_Ideas/2008/3/1132008/Visa_Steel_Ltd.pdf

 

 

 

 

 

Warm Regards,

 

India Infoline Research Team


: Reliance Industries Ltd: BUY, Target Rs3198.



-

Reliance Industries Ltd

CMP Rs2,346, BUY

Target price Rs3,198, Upside 36.3%

Reliance Industries Ltd (RIL) is unfolding a multi sector growth story. With commencement of KG-D6 production in H2 FY09, it will monetize just one of its rich E&P assets. Projects such as MA-1 oil, KG-D9, CBM Sohagpur have great potential. RIL along with RPL is well poised to gain significantly from the extended uptrend in the refining sector. Its integrated structure for petrochemical business would help it post a standout performance despite a slowdown in the cycle. With its enviable success record in executing large scale projects, RIL is venturing in a big manner in to set up Retail and SEZ projects. We recommend a BUY on the stock with a target price of Rs3,198, an upside of 36.3%.

SOTP valuation under base case

Segment

Parameter

Rs mn

US$mn

Rs/share

Refining

8x FY10 EBIDTA

910,955

22,774

627

Petchem

8x FY10 EBIDTA

662,510

16,563

456

E&P

DCF for KG D6 and EV/Boe for others

1,409,281

35,232

970

RPL

70% @ Rs217 (EV/EBDITA of 9x FY10 E)

683,550

17,089

470

Reliance Retail

DCF (sales of US$150/sqft)

348,219

8,705

240

SEZ

Rs40mn/acre (7,500 acres)

225,000

5,625

155

Total

 

4,239,515

105,988

2,918

Net Debt

 

247,415

6,185

170

Net Value

 

3,992,100

99,802

2,747

Treasury stock

 

654,390

16,360

450

Total value

 

4,646,490

116,162

3,198

CMP (Rs)

 

 

 

2,346

 Upside (%)

 

 

 

36.3

Source: India Infoline Research

Warm Regards,

India Infoline Research Team


Usage of ATMs : Dos and Don’ts




Karur Vysya Bank issued following guidelines for the benefit of customers.

  1. Do keep your card safe and secure when not in use
  2. Do maintain a record of your ATM/Debit/credit card No., account No., expiry date and Bank’s customer care No. and store it in a safe place.
  3. Do take a reliable person along with you if you have to transact during late hours
  4. Do notify the bank immediately in case of loss of card
  5. Do change PIN immediately after the receipt of PIN mailer and also periodically
  6. Do retain the receipts of cash withdrawal/ transactions at merchant establishments
  7. Do check your statement of account periodically to ensure that there are no unauthorized transactions in your account.
  8. Do sign the card in the signature band found on the reverse of the card as soon as it is delivered to you
  9. Do exercise caution if strangers are found near the ATM premises
  10. Do collect your card fro the ATM machine before leaving
  11. Do at least one transaction I ATM before using the card in POS
  12. DO change the PIN number immediately after the transaction in case of assistance from strangers
  13. Don’t allow yourself to distracted I any way while using the ATM
  14. Don’t accept help or advice from strangers at the ATM even if he/she claims to be a bank official
  15. Don’t part with your card to any one, particularly to strangers
  16. Don’t write down the PIN number of your card anywhere, particularly on the back of the card
  17. Don’t forget to collect your card and receipt after completion of the transaction
  18. Don’t use the ATM during late hours unless it is an emergency
  19. Don’t let anyone else use your card or PIN
  20. Don’t let anyone stand beside or behind you while transacting in ATM

Nestle India Ltd (F12/07)


Nestle India Ltd (F12/07)

CMP Rs1,531, BUY

Target Price Rs1,793, upside 17.1%

 

ä       Strong growth in domestic and export revenues drives net sales by 24% yoy.

ä       Operating margins expanded by 60bps aided by lower overhead cost. Improved operating efficiency fuels net profit growth.

ä       Expect revenue and net profit CAGR of 16.6% and 14% respectively over the next two years. Maintain Buy with a target price of Rs1,793, an upside of 17.1%.

 

Click below for the quarterly update on Nestle India Ltd.

http://www.indiainfoline.com/content/rep/Result_Analysis/2008/3/532008/nestle_0108.pdf 

 

 

 

Warm Regards,

 

India Infoline Research Team

 


Change in BSE, NSE trading timings from March 4

Trading timings of the Bombay Stock Exchange and the National Stock Exchange will be revised from March 4 to March 18, as the sun's position may disrupt connectivity, causing difficulties in receiving data via satellites.

There would be sun outage from March 4 to 18 between 11.45 am to 12.25 pm, during which traders and investors may face loss of connectivity.

Trading on the bourses would start at 9.55 am and close at 4.15 pm local time owing to the sun outage, the exchanges said. The two exchanges would stop trading between 11.45 am and 12.25 pm and resume trading from 12.30 pm, a stock exchange circular said.



Budget Analysis by Religare

Complete analysis of Budget 2008 is available at

http://www.religareonline.com/2008BudgetSimplified.pdf

Intra day trading tips by Religare team is available at
http://www.religareonline.com/infobuzz.asp

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