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Please move from the market...Soon market will be crash

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. ) (9017 Points)

31 March 2008

Hi Friends

If any of you are closely dealing with share market..This is my advice to you please move from the market as soon as possible or with in a week..This is a time to crash and you people cant predict and cant beleive where it will be stop.The day when results will be coming out.Market will be goes down like anything

Otherwise its your money

All the best

Thanks & Regards

Amit Daga

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10 Replies

Darshu (CA) (1580 Points)
Replied 31 March 2008

Thanks for the info....

Good job.

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gokul rathi (chartered accountants) (21 Points)
Replied 01 April 2008

Dear Friend Don't create panic. But what you say may come true to some extent. Since the fall is coming after a 4.5 year long bull cycle,it is sharp. But the the next downturn may be steeper and could be the last after which the market may see emergence of next bull cycle. This may take 3-6 months. It could throw some good bying opportunities. Thanks gokul rathi pune gokulrathi007 @ yahoo.co.in

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. ) (9017 Points)
Replied 01 April 2008

Rathi jee

I would like to point out you one thing... Hope you heard about the treatment of accounting of Derivative..due to that every company has to book for.exch. loss and that is huge money..expected 12000 to 20000 crores... so result will be below expectation... as well as every signals are wrong...sirjee if you see kal dollar fir se 40 ke niche aagaya...sirjee,,fiis andhe nahi hai aur na he speculator...thatswhy sirjee its very very bad new for the marker... aur iska effect bahut bura hoga... agar unhone ise withdraw nahi kiya

This is my analysis

Amit

CA Dilip (Financial Service) (181 Points)
Replied 01 April 2008

Technical Analyst, Ashwani Gujral feels:

The first level that we need to look at is 4,527, which is 38.2% retracement from 900 to all the way to 6,350. We overshot that on the first attempt on the downside. But that wasn’t the real level.

Now where can this market stop? We are probably heading for a 50% correction of this entire bull market and the level for the Nifty on that could be around 3,626 and around say about 12,000 on the Sens*x, because on a closing basis this is lower than even January 22. So, a new downtrend has probably begun and there should be more downside from here.

CA Dilip (Financial Service) (181 Points)
Replied 01 April 2008

just stay away from companies with Forex Exposure (Income and Loan).

go buy strong domestic stories.

media and Hotel is a good pick

Network 18 look a good buy at this lever (CMP - 212)

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CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. ) (9017 Points)
Replied 01 April 2008

But still i suggest if you want to buy than buy after april ... i suggest you some where around 10th may is very very good time for investment

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. ) (9017 Points)
Replied 01 April 2008

But still i suggest if you want to buy than buy after april ... i suggest you some where around 10th may is very very good time for investment

CA Dilip (Financial Service) (181 Points)
Replied 01 April 2008

Sens*x may head down to 14k in April: Edelweiss

2008-04-01 10:50:46 Source : CNBC-TV18

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Abhijit Chakraborthy of Edelweiss feels that broadly Q4 numbers will be disappointing. He expects the Sens*x to touch 14,000 levels in April. According to Chakraborthy, hedge funds are on the sideline due to redemption pressures. Some hedge funds have seen a 25-40% fall in NAVs in the recent downfall, he said.

Speaking to CNBC-TV18, Chakraborthy said he expects a guidance of 18-20%, in rupee terms, for Infosys. He is bullish on telecom stocks like Bharti, RComm, which he says will report robust numbers. However, is also sees the possibility of a correction in power stocks. Chakraborthy added that no slowdown in expected in capital and engineering goods and in the infra space.

Excerpts of CNBC-TV18’s exclusive interview with Abhijit Chakraborthy:

Q: Give us a sense of what you are hearing from your global clients, both the long only and the hedge variety?

A: The sense we get from them is that the mega long only clients are beginning to buy into the market. They are basically nibbling at stocks which are at attractive valuations. But if one sees the prop books, or the hedge funds, that are primarily driven by absolute return considerations and some of them are also facing redemption pressure, they are largely choosing to stay on the sidelines as of now.

Q: What is your own sense of market now? After yesterday’s sell off how do you see the whole month of April panning out?

A: I broadly feel that the directional correction which was required in the market is largely over. However, in the short-term, the market is not going to see any significant short-term recovery. It’s going to sort of consolidate and react to the short-term news events panning both, domestic as well as international markets.

In the extreme short-term, the fourth quarter numbers could be providing a cue. Unfortunately I think the Q4 numbers are going to be broadly disappointing, there's hardly going to be any positive surprises. The fact that economic data, inflation is also becoming a major concern for future growth, I think April could once again see a correction and we can perhaps come back and test the levels of 14,000.

Q: Is it just redemption pressure for these hedge funds or do you think that’s the tactical call they are taking as well that these markets might grind to lower levels and bet a price points?

A: These hedge funds, or the prop books, they are primarily driven by absolute returns consideration, they are not based on relative performances. In a market, which is so uncertain, it makes sense for them to be on the sidelines, to reduce their activity in the market, that is one reason why the activity is slow. Of course, some of the hedge funds have seen 25-40% of a downside in their performance in the NAVs (Net Asset Value) in the first three months. This has resulted in some kind of a redemption pressure.

At the same time, obviously, there are questions being asked on whether this growth in Indian markets is going to be sustained, whether valuations are going to come back and all that. So I think there are a lot of moving parts and people are choosing to stay away and wait for things to crystallize.

Q: I believe you are expecting a shocker in the guidance from the IT companies, why is that?

A: I think it’s already known in the market that Infosys has been talking down the expectation that Street has from it. Compared to about 20-23%, kind of PAT (Profit After Tax) growth that they have expected to do for FY08, given the fact that the Rupee continues to be an issue, the billing rates are still under pressure. Also, there‘s not much clarity whether the IT Budgets are going to be maintained or how severe the cut is going to be. So being on the judicious side, Infosys is definitely going to give a more subdued kind of guidance. We are expecting anything between 18-20% kind of guidance on Rupee terms for Infosys.

Q: Which sectors are your institutional clients particularly cautious about now for the next quarters or so?

A: Auto happens to be one sector where after the initial euphoria, after the excise duty cuts in the Budget, I think it has died down. Reality is dawning that, even after the excise duty cuts, there has been no significant volume pick up whether in 2-wheelers or in 4-wheelers. On top of that, interest rates have not come down significantly, so that is also not helping the volumes.

The input cost in terms of steel and all other metals prices have gone up very sharply. Given the fact that there is so much of competition in each and every segment of the automobile space, it’s not possible for the companies to pass on the entire cost increase. So that is one sector where people are cautious, waiting for the fourth quarter numbers to pan out.

Banking happens to be another sector where things have gone structurally wrong, at least in the short-term. At least for the next three to six months time that is one sector that people will remain out of. Power stocks and realty are the other two sectors where people are not very comfortable, even at the current valuations. So these are some of the sectors where people are still cautious.

Q: What exactly is the approach been to power in specific and did many of your clients participate in the Reliance Power IPO?

A: I think the QIP subscripttion figure of Reliance Power says it enough. Almost all the institutions had participated in that expecting a quick return. However, it didn’t turn out that way. Fundamentally everybody was sure that at Rs 400, it was not a great buy but everybody was looking for a momentum play in that sector at that point of time.

Power and real estate are not the stocks to be played on the earnings or the profit growth numbers, they are more of a concept stocks and future growth potential, which is being factored in the current prices. So from that perspective, one sees, at least in real estate, that we have to go through one full cycle of real estate, before the valuations can be stabilized in the industry.

As far as power stocks are concerned, people were using more benchmark valuations of a price to book of 3-4 without really finding out whether that is the derivative valuation based on the DCF (Discounted Cash-Flow)model. If the DFC model throws the price to book of four times, so be it. But just using a ballpark valuations was not correct enough and some of the stocks are still not very cheap, so there is a possibility of further correction in some of the power stocks.

Q: Which sectors do you sense the highest amount of optimism in now, from your clients?

A: Telecom is one sector which I think, form the next couple of quarters perspective, the numbers are still going to be very good. Bharti, RCom, they are going to report good numbers as reflected in the healthy subscripttion additions. The competition too is not going to materialize over the next 9-10 months time, so that is one sector where you can see some buying.

Largecap IT stocks have some selective interest, mainly because people are of the opinion that most of the negatives are already in the price and there could be a marginal downside form the current levels. But from a contra point of view, investment point of view people are looking at those stocks.

Capital goods and infrastructure remains the story for India and I don’t see any major slowdown, happening in the investments in that particular space in the entire infra, engineering and capital goods space, so buying is happening in that particular sector

CA Dilip (Financial Service) (181 Points)
Replied 02 April 2008

Markets to open strong & might be bit volalite.

i belive next 3 trading days should be upward before the next selling comes in.

happy investing.

Mridul (Financial Advisor) (225 Points)
Replied 14 April 2008

Sirji, Market to remain choppy, the pressure on government to control the inflation may see an increase, but the IIP nos will lead it to an opposite direction, better to wait for some time before taking any positions