Tag Archives: Reliance

Portfolio Review: 30 October 2010

Many more companies published their quarterly results in the past week. Hero Honda posted biggest drop in quarterly profit in three years. Tata Communications’ consolidated loss widened to Rs 213 crore in the second quarter. Tata Global Q2 net profit slid 82%. KSB Pumps reported a 34% fall in net profit. NTPC’s net profit declined marginally in the second quarter despite a 20% increase in its net sales. Hindustan Unilever Ltd (HUL) beat market expectations by posting a 32 per cent rise in net profit. BHEL Q2 net up 33% at Rs 1142 crore on good revenue from power sector. Glenmark Pharma net up 38% to Rs 112 cr.  Reliance Industries profit Jumped 28% as gas output and refining earnings rise. Mahindra and Mahindra reported 8% rise in quarterly profit.

In the past week, BSE Sensex lost 0.66%, NSE Nifty 0.80% and my portfolio 2.05%. In the month of October, my portfolio made a loss of 0.69% while year to date gain is 12.16%. Many companies in which I have large holding such as Bharti Airtel, Mangalam Cement, KSB Pumps, HUL etc declined 5% to 11% during the month. Dr. Reddys Laboratories, Maharashtra Seamless, Tata Global Beverages helped me to trim the overall loss with a gain of 3% to 15% during the month.

Good buys in my watch list

Script Sector 3 Years Target Current Price Margin
Mangalam Cement Cement 400.00 149.20 168%
Graphite India Engineering 200.00 93.20 115%
KSB Pumps Engineering 1,072.00 503.00 113%
Ess Dee Aluminium Packaging 942.00 471.30 100%
Swaraj Engines Auto Ancil 850.00 468.10 82%
Maharashtra Seamless Metal 743.00 417.20 78%
Hero Honda Auto 3,122.00 1,865.80 67%
HUL FMCG 479.00 294.10 63%
Tractors India Ltd Construction 1,150.00 715.00 61%
Divis Laboratories Pharma 1,095.00 691.85 58%

News Update

Reliance Industries Ltd., India’s biggest company by market value, posted its highest quarterly profit since 2007 after growing fuel demand boosted refining earnings and natural gas production rose. – Bloomberg

Hero Honda on Friday registered a 15% decline in net profit in September quarter, its biggest drop in quarterly profit in three years, on higher raw material costs, capacity constraints and increased competition. Net profit stood at Rs 505.60 crore against Rs 597.14 crore in the same period last fiscal. Net sales increased 11.8% to Rs 4,551.95 crore against Rs 4,069.60 crore in the same period last fiscal. Ebidta margin for the period stood at 13.36%. – The Financial Express

Mahindra & Mahindra India’s largest utility vehicles maker, reported a 7.8 percent rise in second-quarter net profit, as robust volumes in a fast-growing auto market mitigated higher input costs. Costs rose 4-7 percent between April and September, Mahindra’s automotive president Pawan Goenka told reporters on Friday and he expects them to increase further, which may prompt the automaker to pass on some of the rise to consumers, he added. – Reuters

World’s largest electric carmaker Reva Motors, owned by utility vehicle major Mahindra & Mahindra (M&M ), plans to enter China, hoping to cash in on a rising demand for ecofriendly cars as governments push for stricter emission norms globally. The Bangalore-based company looks to introduce its mass market model in China which promotes ecofriendly vehicles through a subsidy programme. – The Economic Times

State-run BHEL reported a 33 per cent increase in its net profit at Rs 1,142.28 crore for the quarter ended September 30 on the back of good revenues from the power sector. The company had posted a net profit of Rs 857.88 crore during the same period last year. BHEL’s revenues from power sector stood at Rs 6,965 crore during the July-September quarter, registering a growth of over 28 per cent against Rs 5,428.3 crore reported during the corresponding quarter of the last year. – The Economic Times

Biocon will invest $161 million in a facility in Malaysia, joining a number of Indian companies that have chosen to establish facilities in the South-East Asian country. This investment would be done through a strategic partnership with a Malaysian firm Biotechnology. – The Economic Times

NTPC’s net profit declined marginally in the second quarter despite a 20% increase in its net sales. This was because of rise in employee cost following pay revision and higher tax burden. The company reported a net profit of Rs 2,107 crore in the September quarter against Rs 2,152 crore in the same period last year. The company’s employee cost for the latest quarter worked out to Rs 709 crore against Rs 504 crore in the corresponding period of 2009-10. The company’s net tax burden for the latest quarter was Rs 9,216 crore against Rs 6,183 crore.  – The Financial Express

State-run NTPC will invest about Rs 20,000 crore to set up a 3,960-megawatt (Mw) coal-based power project in Madhya Pradesh. NTPC had signed a memorandum of understanding with the state government and MP Power Trading Company regarding this, the company said in a filing to the Bombay Stock Exchange. The project is likely to be commissioned during the Twelfth Five-Year Plan Period (2012-17). NTPC currently generates over 32,000 Mw, of which nearly 60 per cent is coal-based. It plans to increase its capacity to 75,000 Mw by 2017. – Business Standard

NTPC Ltd is scouting for tie-ups with global reactor manufacturers for setting up nuclear power projects on its own. The thermal power major, which already has a minority stake in a partnership with its state-owned counterpart Nuclear Power Corporation of India Ltd (NPCIL) for setting up nuclear units, also plans to firm up independent collaborations with global reactor vendors to set up imported Light Water Reactor-based atomic projects. – The Hindu Business Line

KSB Pumps has announced its September quarter results. The company has reported a 6% growth in topline and a 34% fall in bottomline on a YoY basis.

Tata Communications on Thursday reported a consolidated net loss of Rs 213.50 crore for the quarter ended September 30, 2010. The Tata Group company had posted a net loss of Rs 155.54 crore for the same period last year. The company’s total income, however, increased by 8.82 per cent to Rs 2,960.66 crore in Q2, FY’11, from Rs 2,720.48 crore in the same quarter last fiscal. – The Economic Times

Bharti Airtel and Aircel Cellular are interested in buying the yet-to-be-launched Indian wireless broadband business of Qualcomm, industry executives said, an indication that the scales are tilting in favour of the wireless technology being championed by the US-based cellphone chip maker. Bharti Airtel, India’s largest mobile phone company, is primarily interested in Qualcomm’s airwaves and permits for Delhi, complementing the 3G frequencies it won in the circle earlier this year, the executives said. – The Economic Times

Riding on the back of strong growth in domestic sales and R&D innovation, FMCG major Hindustan Unilever (HUL) has clocked a 32.2 per cent jump in net profit at Rs 566 crore in Q2 FY’11 against Rs 428 crore in the year-ago period. Net profit also included an exceptional gain of Rs 40 crore that HUL received through sale of property and restructuring of its closed units. – The Indian Express

Tech Mahindra Ltd has reported a positive earnings surprise for the September quarter, with operating profit adjusted for one-offs rising by 32.1% quarter-on-quarter. But investors are likely to have questions about the sustainability of this growth – The Livemint

Mangalam Cement disclosed a phenomenon drop in standalone net profit for the quarter ended September 2010.  During the quarter, the profit of the company declined 97.58% to Rs 8.57 million from Rs 354.39 million in the same quarter last year. Net sales for the quarter declined 28.08% to Rs 1,157 million, while total income for the quarter fell 27.76% to Rs 1,179.03 million, when compared with the prior year period. – Myiris.com

Swaraj Engines announced that its board has approved expansion program to increase its installed capacity from 36,000 engines to 60,000 engines p.a. The proposed expansion project will entail total capex of around Rs 400 million, which will be fully financed from internal resources. – Myiris.com

For the Sep 10 quarter, Swaraj Engines reported net profit growth of 13% to Rs. 10.82 crore on overall poor performance though partially offset by crash in effective tax rate. The topline grew by 24% to Rs. 86.20 crore on increased sales in engine and high tech components. However fall in OPM by 100 bps limited the growth in operating profit to 17% to Rs. 15.01 crore. The profits were further affected by fall in other income and interest income though partially boosted by crash in effective tax rate. – IIFL

Interesting Reading

Opto Circuits Acquisition of Unetixs Vascular Creates Strong Synergies for Criticare Systems

The acquisition of Unetixs Vascular’s detection and diagnostics products complements and strengthens the existing Opto Circuits (I) Ltd. product portfolio investment in Criticare Systems, Inc.’s vital signs monitoring line and pulse oximetry sensors. Unetixs Vascular is a leader in products aimed at the detection of peripheral arterial disease (PAD), a condition that is affecting a growing portion of the population in both the developed world and in emerging economies.

Read more: http://www.centredaily.com/2010/10/28/2302348/opto-circuits-acquisition-of-unetixs.html#ixzz13rJu5Ctj

Suzlon Energy in a soup

The high-level committee headed by the Chief Secretary that investigated the Attappadi tribal land scam has demanded stringent action against power giant Suzlon Energy Ltd and the provider of the land, Sarjan Realities Ltd, in its report submitted to the government. The committee recommended the dismantling and removal of all the windmills and related accessories from the site. Read more:  http://expressbuzz.com/cities/kochi/suzlon-energy-in-a-soup/219329.html

End of privileges

NTPC is bracing itself for competition as the government mulls starting mandatory tariff-based bidding for power projects allocation from January. The company is taking a fresh look at various cost components of power generation. In the current cost-plus regime, any escalation in cost from project delays gets capitalised. And electricity consumers bear the extra cost, since project delays and cost escalation are not the developer’s headache.  Read more: http://www.indianexpress.com/news/end-of-privileges/701812/

My Portfolio

Return (%)

My Portfolio BSE Sensex NSE Nifty
This Week -2.05% -0.66% -0.80%
This month -0.69% -0.18% -0.20%
This Year 12.16% 14.70% 15.70%
Since 1-1-2009 129.66% 107.65% 103.37%
Since 1-1-2008 54.36% -0.86% -1.02%
Since 1-4-2007 91.77% 53.25% 57.47%

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 9 2.99 Years 78
Tata Global Beverages FMCG 6 1.98 Years 133
Bharti Airtel Telecom 5 10 months 15
HUL FMCG 5 4 Months 15
Hero Honda Auto 5 5 months 1

Shares I bought this month

Company Avg Cost
Graphite India 98.12
Mangalam Cement 162.85
Ess Dee Aluminium 499.41
Opto Circuits 313.74
Divi’s Laboratories 727.32
Tech Mahindra 770.31

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 203 2.5 Years
Dabur India 150 4.5 Years
Tata Global Beverages 133 2.0 Years
Berger Paints 152 3.7 Years
Infosys 78 3.0 Years

Top 5 most loss (absolute)

Company Return % Average Holding Period
KSB Pumps -13 2 months
Opto Circuits -9 1 month
Tata Communication -9 10 months
Mangalam Cement -8 2 months
Ess Dee Aluminum -6 1 month

Archive of previous portfolio reviews


Weekly Portfolio Review: 26 September 2010

BSE Sensex closed the week 2.3% higher and NSE Nifty 2.27%. The month to date gain on my portfolio is 6.78% and year to date 13.29%. Gujarat Gas, Tata Tea, Infosys, HUL and Bharti Airtel are the highest gainer in my portfolio so far in this year.  I partly booked profit on Blue Star in the past week with a 47% margin.

Good buys in my watch list

Company Sector Target Current Price Margin
Divis Laboratories Pharma 1,094.75 710.35 54%
BHEL Engineering 3,567.00 2,454.90 45%

News Update

NTPC

–          NTPC is aiming to add capacity at 13% compounded annual growth rate (CAGR) in order to generate 75,000 mw by March 2017 and reduce its carbon footprint by increasing the share of renewable and nuclear power in its energy mix and improving energy efficiency of coal-fired plants. The firm has projects worth 17,340 mw under implementation and has initiated tendering for execution of another 7,092 mw capacity. Projects worth 27,000 mw are under preliminary stages, NTPC has said. – The Financial Express, 27th September 2010

–          The Sri Lankan government has offered a 25-year tax waiver and customs duty concessions to NTPC’s  500 Megawatt (Mw) power project planned at Sampur near Trincomalee in the east coast of the island nation, through a gazette notification earlier this month. The Sri Lanka government said it accorded the special incentive as it was a project under the Strategic Development Projects Act of the country. NTPC and Sri Lanka will finalise the details soon. – Business Standard, September 25, 2010

–          NTPC’s Pakri-Barwadih coal mining project, for which the Union Coal Ministry has allotted coal blocks, has got forest clearance from the union Ministry of Forest and Environment for its stage two work. “With this the stage is cleared for starting Conveyor Corridor, Railway Corridor and starting coal mining production by 2012 as per the revised target fixed by the union government,” Rao, the general manager of NTPC’s coal mining project, told newsmen here on Wednesday. – The Economic Times, September 22, 2010

Suzlon

–          The country’s largest wind turbine manufacturer Suzlon Energy on Friday said it has crossed 5,000 MW (megawatt) of cumulative installations in India, underlining the strong momentum in the country’s fast-growing wind energy market. Suzlon has cum ulatively added over 5,000 MW of wind power capacity for over 1,500 customers in India across 40 sites in eight states. – The Business Line, September 24, 2010

–          Wind power major Suzlon Energy today said it has bagged a Rs. 1,149-crore order from Kolkata-based engineering firm Techno Electric Group. The 202 MW (megawatt)order is a part of Techno Electric Group’s agreement with Suzlon for developing 500 MW of new capacity and is the single largest deal signed by an Independent Power Producer (IPP) in the wind power sector, Suzlon said in a filing to the BSE. – Livemint.com, September 21, 2010

Bharti Airtel

–          Zain Kenya, a unit of Bharti Airtel Ltd., plans to overtake market leader Safaricom Ltd. to become the east African nation’s largest mobile phone operator within three to four years, Managing Director Rene Meza said today. Over the next 18 months, the company plans to spend 28 billion shillings ($345 million) expanding Internet coverage to rural areas and rolling out a third-generation network by year- end, Meza said in an interview in Kenya’s capital, Nairobi. – Bloomberg, September 23, 2010

–          Telecom major Bharti Airtel said on Monday that it has given contracts to Ericsson India, Nokia Siemens Networks (NSN) and Huawei Technologies to set up infrastructure for providing 3G services in the country.  These vendors will plan, design, deploy and maintain 3G-HSPA (third generation, high speed packet access) networks in 13 telecom circles where the company has won 3G licences, Bharti Airtel said in a statement. – The Economic Times, September 20, 2010

–          Bharti Airtel, India’s largest mobile-phone company, forecasts “rapid growth” at its satellite television unit on rising demand in rural areas for Bollywood movies and soap operas. Bharti has signed up 3.8 million customers to gain a 14% market share, said Ajai Puri, chief executive officer of the company’s digital TV services business. Industrywide, as many as 12 million people may take up satellite television this year, Mr Puri said in an interview on September17 in New Delhi. – The Economic Times, September 21, 2010

Dr Reddy’s

–          Promoters of Dr Reddy’s Laboratories have no intention of diluting their stake in the company, its managing director K Satish Reddy said today. “Let me be clear once again. We have no such intention to sell any stake or what so ever. There is no such move (dilution of stake),” Satish Reddy replied when asked on the sidelines of pharma CEOs conclave here. He said they will continue to focus on achieving three billion dollars turnover by 2013. – Business Standard, September 24, 2010

GAIL

–          State-run gas transporter GAIL India will make capital investment of around 400 billion rupees ($8.8 billion) by 2014/15, mainly to expand its pipeline network and boost petrochemicals capacity, its chairman said on Wednesday. B.C. Tripathi also said GAIL was exploring gas sector opportunities in the African market. He was speaking at the company’s annual general meeting of shareholders. – Reuters, September 22, 2010

–          State-run GAIL India on Wednesday imported its first liquefied natural gas (LNG) cargo of the year at around $8.3 per million British thermal unit, about a dollar more than what Petronet LNG paid just four-days ago. GAIL, which bought the cargo from BG Group of UK at around $8.3 per mmBtu, plans to import two more cargoes from the spot market this year. – The Economic Times, September 22, 2010

Hero Honda

–          With arch rival Bajaj Auto gaining ground in the entry level of bike segment, the country’s largest two-wheeler maker Hero Honda has admitted its leadership position will come under pressure. The company, which is currently a subject of speculation over a possible exit of Japanese partner Honda from the joint venture with Munjals, has been witnessing a decline in market share in motorcycles of 75cc and above but less than 125cc category. Its market share declined to 61.62 per cent in the April -August period this fiscal, from 73.85 per cent in the same period of 2009-10. – Business Standard, September 20, 2010

Interesting Reading

Brand Hero eyes life after Honda

With Hero Group’s 25-year old marriage with Japan’s Honda Motor seen drawing to a close, all eyes are on the future of Hero’s brands assiduously built up over the years. Will popular bike brands like Splendor and Passion continue to evoke the same excitement or will the absence of the Honda brand change the fortunes of the company? http://www.indianexpress.com/news/brand-hero-eyes-life-after-honda/686793/

Mahindra & Mahindra’s U.S. Plans Are in Jeopardy

Car buyers expect a degree of haggling when shopping for a new vehicle. Yet the fate of trucks built by India’s Mahindra & Mahindra may be determined in the federal courts and by arbitrators, long before the rugged-looking 4×4s even begin rolling onto dealership lots. Mahindra and its American importer, Atlanta-based Global Vehicles U.S.A., are embroiled in a dispute that could halt plans to bring the first Indian-built vehicles into the American market. http://wheels.blogs.nytimes.com/2010/09/21/mahindra-mahindra-u-s-plans-are-in-jeopardy/

Revving two-wheeler sales to cross 12 m this fiscal

Two-wheeler sales for this fiscal are projected to be in excess of 12 million units, a jump of 20 per cent from around 10 million units in 2009-10. Sources say Hero Honda and Honda Motorcycle & Scooter India will together account for nearly 55 per cent of this number at 6.5 million units, followed by Bajaj Auto with over 3.5 million units and TVS Motor with nearly two million units. Yamaha and Suzuki, which are marginal players in comparison, will add to the overall kitty. http://www.thehindubusinessline.com/2010/09/21/stories/2010092150080300.htm

RIL puts out annual reports of 82 of 96 subsidiaries, still not unravelled many layers

It was big, but secretive. It was clever, but complex. That was Reliance Industries Limited (RIL), India’s largest private sector company, when it came to organising its books of accounts and presenting them to the public. Even as it takes a big leap to become more transparent, all those attributes — in shades of black, white and grey — remain characteristic of RIL. http://economictimes.indiatimes.com/news/news-by-industry/energy/oil–gas/RIL-puts-out-annual-reports-of-82-of-96-subsidiaries-still-not-unravelled-many-layers/articleshow/6617094.cms

Crompton Greaves puts wind in Europe sales

The cold, choppy waters of the North Sea are increasingly playing host to a new creature — the slender-necked, rotor-headed, offshore windmill. Sprouting along the coasts of Germany, Norway, Denmark and more recently Belgium, offshore wind energy farms are the new temples for the 21st century environmentalism sweeping across Europe. They perform the seemingly utopian transformation of a free, non-polluting resource — the wind — into the electricity needed to feed the power-hungry contemporary world. And being offshore, they avoid entanglements in the land-use disputes common in densely populated regions, while enjoying the higher and more consistent wind speeds available over the sea. http://www.business-standard.com/india/news/crompton-greaves-puts-wind-in-europe-sales/408897/

Paint companies: Glossed over

Companies in the paints sector are bracing for the increased demand due to robust economic growth and rising incomes. Berger Paints, the third-largest player, plans to increase its capacity from 250,000 tonnes to 450,000 tonnes in the next two years, while the second-largest Kansai Nerolac will enhance its capacity by 50 per cent to 300,000 tonnes over the next three years. Market leader Asian Paints plans to triple its current capacity of about 600,000 tonnes in the next few years. http://www.business-standard.com/india/news/paint-companies-glossed-over/408755/

Hindustan Unilever’s Bharat Darshan

The new consumers in India’s villages are ambitious and demanding just like their urban counterparts. And Hindustan Unilever is responding to the change with a distribution overhaul. Read more: http://business.in.com/article/boardroom/hindustan-unilevers-bharat-darshan/17462/1#ixzz10fSQE554

My Portfolio

Return (%)

My Portfolio BSE Sensex NSE Nifty
This Week 1.13% 2.30% 2.27%
This month 6.78% 11.54% 11.40%
This Year 13.29% 14.77% 15.71%
Since 1-1-2009 131.97% 107.79% 103.39%
Since 1-1-2008 55.91% -0.80% -1.01%
Since 1-4-2007 93.70% 53.34% 57.48%
Since Beginning 124.31% 54.93% 60.69%

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 10 2.85 Years 82
Tata Global Beverages FMCG 7 1.80 Years 134
Bharti Airtel Telecom 7 8 months 27
HUL FMCG 7 3 Months 23
Hero Honda Auto 6 4 months 1

Shares I bought this month

Company Average Price
Dr Reddy 1,363.00
KSB Pumps 562.99
Hero Honda 1709.70
Maharashtra Seamless 378.95
Hindustan Zinc 1140.86
HUL 279.15

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 214 2.3 Years
Dabur India 164 4.4 Years
Tata Tea 134 1.8 Years
Berger Paints 172 3.5 Years
Infosys 82 2.9 Years

Top 5 most loss (absolute)

Company Return % Average Holding Period
Mangalam Cement -6 1 month
KSB Pumps -6 1 month
Graphite India -5 2 months
Hindustan Zinc -4 1 month
Tata Communications -4 9 months

Archive of previous portfolio reviews


Weekly Portfolio Review: 11 September 2010

How do you track your investment in shares? Most of the brokers provide a portfolio tracker integrated to its online trading platform. It is enough for an average retail investor. The transaction and current market price will be automatically updated in the system. If you are so enthusiastic that you don’t mind spending some extra time in updating your transaction on another system, there are many paid and free online service to track and manage your investments. Those provide tools to analyse your investment with real time data including news related to shares in your portfolio. One such comprehensive and free portfolio tracker is provided by www.moneycontrol.com. You can also manage your portfolio with your own spreadsheet or download one here.

Indian benchmark indexes BSE Sensex and NSE Nifty surged over 3% this week. My portfolio gained 4.62% in the month to date and 11% year to date. Gujarat Gas, Suzlon Energy and Blue Star were largest contributor of gain in the month so far for me while Hero Honda was in negative. I bought Hero Honda, KSB Pumps and Maharashtra Seamless this week. This made Hero Honda and Maharashtra Seamless into my top 5 holding. Uncertainty about the parting of joint venture of Hero group and Honda still remain, though both parties have denied it. In case the Honda leaves the JV, the stock price may tumble!

Good buys in my watch list

Script Sector Target CMP Margin
KSB Pumps Engineering 1,072.25 572.45 87%
HUL FMCG 470.00 277.85 69%
Hindustan Zinc Metal 1,730.00 1,086.90 59%
Reliance Petro 1,450.00 957.95 51%
Dr. Reddy Pharma 2,106.00 1,401.50 50%

News Update

–          Mahindra & Mahindra (M&M), the country’s biggest sport utility vehicle (SUV) maker, is working on smaller fuel-efficient petrol engines to power its future growth, likely to be driven by overseas markets – Business Standard

–          Drug maker Dr Reddy’s Laboratories (DRL) has lined up investments worth around Rs 1,600 crore over the next two years for capacity expansion and building new capabilities. The company feels these investments will help it meet future growth requirements and become a $3-billion company by 2013. – Business Standard

–          Crompton Greaves Ltd said on Friday that it entered into pact with Spain-based ZIV Aplicaciones y Tecnologia, S. L (ZIV), for establishing a joint venture company in India, for the manufacture of sub-station automation systems. It is estimated that the total equity capital of the joint venture will be Rs. 10 crore, out of which the company will contribute Rs. 7 crore, for a 70 per cent shareholding. – Business Line

–          The Hero Honda stock is down six per cent over the last one week and over 15 per cent down over the last one month. The Street is worried about reports that Honda, the Japanese joint venture (JV) partner, may sell its stake in the company and exit to focus on its 100 per cent owned Indian subsidiary, Honda Motorcycles and Scooters India (HMSI). – Business Standard

–          FMCG major Hindustan Unilever (HUL), owner of well-known tea brand Brooke Bond, today launched a body to spread awareness, dispel “myths and misconceptions” existing around tea and educate people on its health benefits.

–          The number of mobile subscribers in the country crossed the 652.42 million mark in July, with the addition of 16.92 million connections, official data show. The growth in this category was led by Bharti Airtel, which added 2.6 million users to take its subscriber base to 139.2 million users. – The Times of India

–          Leading paint manufacturer Kansai Nerolac Paints (KNPL) on Tuesday said it plans to invest Rs 600 crore to enhance its production capacity by 50 per cent over the next three years.  The company has also appointed Bollywood superstar Shah Rukh Khan as brand ambassador for promoting its eco-friendly paints. – The Economic Times

–          India’s second largest paints maker Kansai Nerolac Paints is looking at an 18-20% sales growth for the 2010-11 fiscal. It had recorded a similar growth in 2009-10 when the company clocked a turnover of Rs 1,970 crore. The company, which holds a 12% market share in the decorative paints segment after Asian Paints, might go for a price hike post October. – The Financial Express

Interesting Reading

NTPC blues: Financial Express

NTPC, the other large PSE operating in the power segment, seems to be caught in a downward spiral. The company that was identified as a prize jewel and conferred the Maharatna status only recently has seen its fortunes dip sharply, mainly on account of growing competition from private sector units. Although NTPC was to commission an additional capacity of 9,220 mw by the middle of the Eleventh Plan, it was able to set up only 3,730 mw during the period.

Bharti Airtel: The making of a media conglomerate – Business Standard

Is Bharti Airtel India’s fourth-largest media company? If estimates are right, then its revenues from selling music downloads, DTH services, IPTV and digital media outsourcing were upwards of Rs 2,900 crore in March 2010. That is about 7 per cent of its Rs 41,829 crore revenues that year. This number puts India’s largest telecom operator right at the top of the media big league. The interesting part is not just the size of its media play, but the products and services that have taken Bharti Airtel to this position. Unlike other media biggies, its fortunes come not from selling newspapers or broadcasting TV channels, but from redistributing music, selling television signals and being the back-end for a host of media companies.

My Portfolio

Return (%)

Return
My Portfolio BSE Sensex NSE Nifty
This Week 2.49% 3.26% 3.01%
This month 4.62% 4.61% 4.40%
This Year 11.00% 7.64% 8.44%
Since 1-1-2009 127.27% 94.88% 90.61%
Since 1-1-2008 52.76% -6.96% -7.23%
Since 1-4-2007 89.78% 43.82% 47.59%

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 10 2.85 Years 73
Tata Global Beverages FMCG 7 1.80 Years 139
Bharti Airtel Telecom 7 8 months 20
Hero Honda Auto 6 3 Months -6
Maharashtra Seamless Metal 5 2 months -3

Shares I bought this month

Company Average Price
Dr Reddy 1,363.00
KSB Pumps 561.38
Hero Honda 1709.70
Maharashtra Seamless 378.95

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 221 2.3 Years
Dabur India 173 4.4 Years
Tata Tea 139 1.8 Years
Berger Paints 130 3.5 Years
Infosys 73 2.9 Years

Top 5 most loss (absolute)

Company Return % Average Holding Period
Hero Honda -6 3 months
Graphite India -4 1 month
Hindustan Zinc -4 1 month
Mangalam Cement -3 1 month
Maharashtra Seamless -3 2 months

Archive of previous portfolio reviews


Monthly Portfolio Review: August 2010

2010 continues to be a lackluster year for the stock markets with Sensex gaining just 2.90% year to date. My portfolio gained 6.09% during the same period. Five companies namely Tata Global Beverages, Gujarat Gas, Dabur India, Piramal Healthcare and Crompton Greaves contributed 72% of my total gain in the year to date, while Suzlon Energy took me down sucking 23% of my overall gain. It was a terrible mistake that I missed to offload Suzlon at right time. Huge debts on its balance sheet and poor performance of the wind power sector in America and Europe due to downturn put Suzlon in a mess. Almost all of shares that I bought during last three months are in negative. Q2 of 2010 was the best quarter as all my gain was registered during this quarter.

My Portfolio

In the month of August I invested in some small-mid cap stocks like KSB Pumps, Swaraj Engines, Mangalm Cements and Hindustan Zinc. I also added more on Dr. Reddy’s Lab, Hero Honda and Reliance Industries. During the coming weeks, I may consider adding some more of these stocks. There is no major change in my top 5 holding and top 10 holding is below 60% of total value. Average holding period is about 11 months and Dabur India being the highest with 4.38 years in my holding.

News Updates

Major news on companies during the last week

The stock of Reliance Industries has taken a beating as the company’s motive behind the stake purchase in EIH is not clear. The jury is still out over the decision of Reliance Industries (RIL) to buy a 14.12 per cent stake in East India Hotels (EIH). Reactions are mixed, as RIL’s intention behind the purchase is not clear. The markets did not seem happy with the Rs 1,021-crore outflow in an unrelated investment. Hence, the share price tanked. – Business Standard

NTPC and Bhel are jointly setting up a project to manufacture power plant equipment with an outlay of Rs6,000 crore at Mannavaram in Chittoor district. Government estimates claim that about 6,000 direct jobs would be created in the project in addition to about indirect employment to about 25,000 people. Prime Minister Singh would lay the foundation stone, after repeated postponements, for the project on September 1. – DNA

Telecom major, Bharti Airtel, today announced the launch of data services in Thailand and Malaysian markets.  “The launch…enables us to cater to two of the fastest-growing international bandwidth markets,” Bharti Airtel’s Chief Executive Officer for global data business, Ajay Chitkara, said. – The Economics Times

Maharashtra Seamless has reported a 9.5 per cent hike in the net profit for the year ended March 31, 2010 over the previous financial year ended March 31, 2009. The net profit has increased from Rs 259.91 crore for FY09 to Rs 284.60 crore for FY10. However net sales fell by 21 per cent, from Rs 2038.87 crore for the financial ended March 31, 2009 to Rs 1593.17 crore for FY10. – Business Standard

Glenmark Pharmaceuticals on Monday said it has discovered a new drug molecule, which could be used for treating pain and respiratory disorders. The new drug molecule, codenamed ‘GRC 17536′ has completed pre-clinical trials (animal tests) and will move into clinical trials (tests on humans) in the first quarter of 2011, the company said in a statement. – The Economic Times

State-run utility NTPC Ltd on Monday signed a preliminary agreement with Bangladesh Power Development Board (BPDB) for developing the power sector in the neighbouring country. NTPC may consider setting up a 1,320 megawatts coal-based power plant in Bangladesh in a joint venture with BPDB, subject to techno-economic viability, NTPC said in a statement. – The Economic Times

In a strategic move, FMCG major Hindustan Unilever Ltd (HUL) is consolidating its brand building strategy for its entire packaged foods business under the master brand ‘Knorr’. With the proposed foray of Tata Global Beverages into the packaged foods sector, competition will hot up soon. The Rs 50,000 crore packaged foods industry is currently growing at the rate of 15%. – The Financial Express

The stock markets cheered the price hikes by Hindustan Unilever (HUL) and Marico, with a majority of stocks in the FMCG (fast moving consumer goods) Index rising one-four per cent on Wednesday. While the move to raise prices is a positive, it will only be able to cover the increase in input costs. – Business Standard

Mahindra & Mahindra Wednesday said it will set up a new tractor facility by 2012-13 fiscal with a production capacity of up to one lakh units per annum, for which it is looking at South India, including Tamil Nadu. The company currently has four facilities in Nagpur, Mumbai, Jaipur and Chandigarh with a total production capacity of two lakh units annually. – The Economic Times

B K Birla Group company Mangalam Cement on Tuesday (24th August) said its board has given in-principle nod for the merger of sister firm Mangalam Timber Products with itself. Mangalam Timber Products went into the red last fiscal with a net loss of Rs 1.23 crore against a Rs 1.5 crore net profit in the previous fiscal. Mangalam Cement, which has a two million tonnes per annum facility at Kota in Rajasthan, had recorded net profit in the last fiscal Rs 118.81 crore against Rs 97.16 crore in the previous fiscal. – The Economic Times

Bharti Airtel, which acquired the African assets of Zain Telecom in February, has started the process of giving orders for setting up new telecom towers there. The company had already sought bids to set up towers in countries like Nigeria, Kenya and Tanzania, said sources. Bharti is giving these orders market wise, instead of one bulk order. They said the contracts for passive infrastructure equipment and turnkey projects to build towers were likely to be awarded next month. – Business Standard

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