Tea Industry Update - "The hot sip!"




Tea Industry Update - "The hot sip!"

 

The tea production in Kenya - the second largest tea producing country in the world, is expected to decrease by 10% yoy to 335mn kg while exports are likely to drop by 25mn kg this year, due to dry weather conditions currently being experienced in tea growing areas and interruptions in tea plucking and processing owing to skirmishes experienced in January 2008. Although, India is the largest producer of tea, it is also the largest consumer of tea and therefore only 15-20% of its produce is exported, while the rest is domestically consumed. Kenya on the other hand exports almost its entire produce and therefore a shortfall in Kenyan output would lead to tight global supplies.

 

The shortfall in Kenya could worsen an already tight global supply of tea and would further push up the prices. Tea industry veterans have been predicting that prices could rise by Rs5-7 per kg for the next full year and after taking Kenya into account, the rise is likely to be even higher. Firm tea prices, will be a concern for the branded tea players, since it will lead to an increase in their tea procurement cost. Although we are positive on the outlook of Tata Tea's business, it may not be the best play to capitalize on the rising tea price trend. Some of the large plantation stocks like Mcleod Russel, Duncans Industries, Goodricke, Jay Shree and Harrisons Malayalam may offer greater appreciation.

 

Click below for detailed update on Tea Industry
 
 
Warm Regards,
 
India Infoline Research Team

Tech Mahindra Con Call Note - "Clarity on growth to drive stock price"






 

Tech Mahindra Con Call Note – "Clarity on growth to drive stock price"

CMP Rs702, BUY

Target price Rs854,  Upside 21.7%

  

Click below for Con Call Note on Tech Mahindra

http://www.indiainfoline.com/content/rep/Investment_Ideas/2008/2/2722008/TechM_%20Con%20Call%20Note.pdf

 

 

 

Warm Regards,

 

India Infoline Research Team


Beware Of Emails





   
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Let's Beware of Frauds!
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  9. Do not fall prey to scamsters. For more tips and insights into frauds, we recommend that you visit "Safe Banking" at www.icicibank.com.
Enjoy the convenience of online banking in a safe and secure milieu!  

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Rel Power plans bonus issue to offset shareholders’ losses

Reliance Power Ltd (RPL) plans to issue bonus shares to all equity holders other than the founders, hoping to cheer retail investors after the firm’s shares tumbled following a record $3 billion (Rs11,910 crore) initial public offering (IPO). RPL’s board is scheduled to meet on 24 February to consider issuing bonus shares and/or other measures, which the company said would effectively reduce the cost of the company’s shares.
“This will include a proposal for issuing free bonus shares to all categories of shareholders excluding the promoter group, thereby protecting investors from even short-term losses on their shareholdings,” RPL said.
Reliance’s supporters say the Ambani family has a strong track record of executing projects on schedule and delivering strong returns to investors, attracting millions of investors to bid for its shares offered in India’s biggest IPO.
The company said its shares were hit by weak market sentiment and blamed rivals, who were not identified, for hammering shares of companies in the Anil Dhirubhai Ambani Group. The company also reminded investors that there were risks attached to equity investments.
“Equity shares, by their very nature, are risk-bearing instruments and there is no obligation on behalf of any issuer to insure investors against possible losses,” the company said.
However, the company’s board would consider a bonus issue and other steps as the group had a “fundamental and overriding philosophy of creating value for genuine long- term investors.”
See what I wrote on Reliance Power on 12.02.2008
Yes. I trust Anil more than Mukesh and Market .

Hindustan Unilever Ltd (Q4 F12/07): BUY






Hindustan Unilever Ltd (Q4 F12/07)

CMP Rs203, BUY

Target price Rs244,  Upside 20.2%

 

ä       Net sales slightly above expectations at Rs36.9bn led by strong 18% yoy growth in HPC and 17% growth in foods segment.

ä       Higher adspend and staff cost restricts margin expansion. EBIT margins in the personal products segment witnessed sharp 250bps improvement.

ä       Strong revenue growth coupled with higher other income drives net profit.

ä       We expect HUL to register revenue and profit CAGR of 12% and 12.9% respectively over the next two years. Recommend Buy with a price target of Rs244 - an upside of 20.2%.

 

Click below for the quarterly update on Hindustan Unilever Ltd.

http://www.indiainfoline.com/content/rep/Result_Analysis/2008/2/1522008/hindunilvr_0108.pdf 

 

 

Warm Regards,

 

India Infoline Research Team


What a Show?

Reliance Power made a spectacular listing and everybody burnt their fingers. In grey market some bought @ Rs.900/shares (2months back). Our cases are not that much as terrible as IPO financiers and grey market buyers. OK. What to do know? I personally think, we would soon get a chance to exit from this stock and price would move past Rs.450 within next 6 months. Calculate the opportunity cost of your funds and then decide. I didn't sell my holdings yesterday. I would exit this stock only at profit.
I trust Anil than the market.

Remain in sidelines

As the reasons for current market turmoil are still unclear ( except we ran too far, too fast), I suggest you to remain in sidelines. Those who got Reliance Power allotment may sell 75% of their holding today and book profit whatever you get. Don't bottom fish now. Don't day trade as odds are not in our favor. Select sectors may exhibit pre-budget rally. In that case, book profit in every 10% rise or use trailing stoploss to book profits.

Colgate-Palmolive (India) Ltd (Q3 FY08) - BUY






Colgate-Palmolive (India) Ltd (Q3 FY08)

CMP Rs421, BUY

Target price Rs515,  Upside 22.5%

 

ä      Q3 revenues almost in line with our expectations at Rs3.7bn, driven by strong ~8% volume growth in the toothpaste category.

ä      Operating margins remained under pressure due to sharp rise in adspend. Higher spend on brand reinforcement not a cause of concern.

ä      With increasing fiscal benefits from Baddi plant and strong volume growth across segments, we expect Colgate to register revenue and profit CAGR of 12% and 13% respectively over the next two years.

ä      Maintain Buy with a target price of Rs515, an upside of 22.5%.

 

Click below for Result Update on Colgate-Palmolive (India) Ltd (Q3 FY08)

http://www.indiainfoline.com/content/rep/Result_Analysis/2008/2/122008/Colgate_0108.pdf

 

 

 

Warm Regards,

 

India Infoline Research Team


Godawari Power & Ispat Ltd (Q3 FY08) - BUY






Godawari Power & Ispat Ltd (Q3 FY08)

CMP Rs258, BUY

Target price Rs400,  Upside 55%

 

ä      Revenue surged 74.6%yoy and 22% qoq

ä      OPM expanded 170 basis points yoy, but down 240 basis points qoq

ä      The company was awarded prospecting license of iron ore

ä      Captive resources to show results in FY10

ä      Maintain BUY with a target of Rs400

 

Click below for Result Update on Godawari Power & Ispat Ltd.

http://www.indiainfoline.com/content/rep/Result_Analysis/2008/2/422008/gpil_0108.pdf

 

 

 

Warm Regards,

 

India Infoline Research Team


Reliance Power Allotment

Here is the basis of Reliance Power IPO Allotment

No. Of Shares Applied No. of Shares allotted Ratio of Allotted to applicants
15 15 2:27
30 15 4:27
45 15 2:9
60 15 8:27
75 15 10:27
90 15 4:9
105 15 14:27
120 15 16:27
135 15 2:3
150 15 20:27
165 15 5:6
180 15 8:9
195 15 1:1
210 15 1:1
210 16 1:47
225 16 1:1
225 17 1:10

Your application status can be checked online @

http://203.199.177.158/ipo/

www.karvy.com

Buy Gujarat NRE Coke

This week also market is expected to be erratic. For this week , buying of Gujarat NRE Coke and Hexaware may be considered for short term gains. Buying in small lots of JSW Steel, Maruthi Suzuki, Ashok Leyland, ITC and Hotel Leela may also be considered.

GlaxoSmithkline Consumer Healthcare Ltd (F12/07): BUY





GlaxoSmithkline Consumer Healthcare Ltd  (F12/07)

CMP Rs611, BUY

Target price Rs769,  Upside 25.8%

 

ä       Strong 9% volume growth drives revenues by 15% yoy.

ä       Margins expand 90bps despite inflationary pressures.

ä       Net profit in line with expectations at Rs1.6bn, up 28% yoy.

ä       Maintain BUY with a target price of Rs769, upside of 26%.

 

Click below for the detailed update on GlaxoSmithkline Consumer Healthcare Ltd.

http://www.indiainfoline.com/content/rep/Result_Analysis/2008/1/3112008/gskcons_0108.pdf

 

 

Warm Regards,

 

India Infoline Research Team


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