Final Report Stock BroKING

Fundamental And Technical Analysis Of Specific Companies In NIFTY 50

CHAPTER 1

INTRODUCTION

Fundamental analysis is a type of stock selection discipline. If you conduct thorough research of a company's accounting statements before deciding to purchase stock in the company for investment purposes, you are said to be following a fundamental analysis approach to investing. Another very common approach is technical analysis, which is almost the opposite type of approach. A fundamental analysis approach attempts to determine whether the company is financially sound and will continue to earn money. A technical analysis approach to investing is almost entirely concerned with how the price of the stock has performed over time and attempts to predict what it will do in the future based on this. Sometimes, the two approaches are combined, with a fundamental analysis approach used to select the stocks and a technical analysis approach used to time the investment in the stocks of interest.When performing a fundamental analysis of the stock of interest, one tries to determine whether the stock is worth investing in. In this approach, one looks at how well the company is performing financially. What are the company's earnings? Have they been growing? How does the ratio of the price of the stock versus the earnings per share, the P/E ratio, compare with other similar companies?

This approach attempts to answer some basic or fundamental questions about the financial health of the company and the industry in which the company operates. How large is the company? How long has it been in business? What is the management of the company like? What is the outlook for the industry that the company is in?

Fundamental analysis is usually viewed as a more conservative approach to stock selection than technical analysis. It is certainly a more exact science. The price earnings ratio is easy to calculate; it is simply the price of each share of the stock divided by the earnings per share. The book value of the company can easily be determined from the company's financial statements, and the earnings are easily calculated from the financial records.

In contrast, the mathematics behind most technical analysis is much more complex and frequently requires much more of a judgement call on the part of the investor. In a technical analysis approach, the investor attempts to predict crowd behavior, while a fundamental analysis simply attempts to determine whether the company has been earning money and at what rate it will likely continue to earn money. The price of the stock in the short term is not that important in a fundamental analysis, since the theory is that if the company is earning money and continues to earn money, then the stock price will eventually go up. A technical analysis approach is much more concerned with short term price movements.

Investing in stocks is much more likely to be successful if a systematic approach is used. A fundamental analysis approach is the easiest to understand and learn, and as such, it is perhaps the best place to start for a beginning investor. However, both approaches have their strengths, and knowledge of both will benefit any investor and result in improved investment returns.CHAPTER 2

RESEARCH METHODOLOGY

Study Objectives To learn about various type of techniques used for forecasting of future stock price

To analyze the type of trend on basis of various charts

To find out appropriate time to buy and sell securities

To forecast the future target price of various stock on long term basis, Intermediate basis and short term basis.Scope of Study

This project can help investors in maximizing the returns and preserving capital while investing their money in stock market

Methods of Data Collection

Primary Data

Metastock Professional Software

Personal interaction with Mr. Himal Parekh (C.M.D. of Interface Financial Services)

I-charts. in the official website for accessing the various charts of stocks

Secondary Data

From Books

From Internet

From Research Reports

Statistical Tools

We have used following tools in this project

Relationship between financial performance and stock price

Concept of Technical Analysis viz. Support and Resistance

Limitations

One of the limitation was that the field is so large that an in depth study of the all the avenue is not possible.

Lack of time.

We were not able to find all chart patterns. For e.g. Progressions of gaps, Island reversal, Percentage retracement, Key Reversals, Rate of Change (ROC), etc..CHAPTER 3

ABOUT STOCK BROKING INDUSTRY

INTRODUCTION

Stock exchanges to some extent play an important role as indicators, reflecting the performance of the countrys economic state of health. Stock market is a place where securities are bought and sold. It is exposed to a high degree of volatility, prices fluctuate within minutes and are determined by the demand and supply of stocks at a given time. Stock brokers are the ones who buys and sells securities on behalf of individuals and institutions for some commission.

The Securities and Exchange Board of India (SEBI) is the authorized body, which regulates the operations of stock exchanges, banks and other financial institutions. The past performances in the capital markets especially the securities scam by Hasrshad Mehta has led to tightening of the operations by SEBI. In addition the international trading and investment exposure has made it imperative to better operational efficiency. With the view to improve, discipline and bring greater transparency in this sector, constant efforts are being made and to a certain extent improvements have been made.

HISTORY

Indian Stock Markets are one of the oldest in Asia. Its history dates back to nearly 200 years ago. The earliest records of security dealings in India are meager and obscure.

By 1830's business on corporate stocks and shares in Bank and Cotton presses took place in Bombay. Though the trading list was broader in 1839, there were only half a dozen brokers recognized by banks and merchants during 1840 and 1850. The 1850's witnessed a rapid development of commercial enterprise and brokerage business attracted many men into the field and by 1860 the number of brokers increased into 60.

In 1860-61 the American Civil War broke out and cotton supply from United States of Europe was stopped; thus, the 'Share Mania' in India begun. The number of brokers increased to about 200 to 250. However, at the end of the American Civil War, in 1865, a disastrous slump began (for example, Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. 87). At the end of the American Civil War, the brokers who thrived out of Civil War in 1874, found a place in a street (now appropriately called as Dalal Street) where they would conveniently assemble and transact business.

In 1887, they formally established in Bombay, the "Native Share and Stock Brokers' Association" (which is alternatively known as "The Stock Exchange"). In 1895, the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. Thus, the Stock Exchange at Bombay was consolidated.

Thus in the same way, gradually with the passage of time number of exchanges were increased and at currently it reached to the figure of 24 stock exchanges

Traditional Broking

Traditionally In stock Market, the investors invest their money in shares under the guidance of the Brokers of any stock broking company. This is convenient to those investors who are not familiar with the computer and the use of internet. But it requires more dealers to the share broking companies to give guidance related to investment. There was a chance of inaccuracy of price because it is a time consuming process. The cost of the company also increases due to more paperwork. The investor point of view, there was a problem of privacy. The information of investor may leak by the broker. So, to remove these limitations of traditional broking, there was an emergence of new concept e-Broking.

E- Broking - A small beginning:

You have some money to dabble with. Trading shares on BSE/NSE has always been your dream. When will you ever find the time? And besides, the hassle of finding a broker is not easy. Realizing there is untapped market of investors who want to be able to execute their own trades when it suits them, brokers have taken their trading rooms to the Internet. Known as online brokers, they allow you to buy and sell shares via Internet.

There are 2 types of online trading service: discount brokers and full service online broker. Discount online brokers allow you to trade via Internet at reduced rates. Some provide quality research, other dont. Full service online brokerage is linked to existing brokerages. These brokers allow their clients to place online orders with the option of talking/ chatting to brokers if advice is needed. Brokerage rates here are higher. 5Paisa.com, ICICIDirect.com, IndiaBulls.com, Sharekhan.com, Geojit securities.com, HDFCsec.com, Tatatdw.com, Kotakstreet.com are some of the online broking sites in India. With Net trading in securities and rapid consolidation between multiple stock exchanges, the international securities marketplace is fast becoming a "global village" through the creation of a universal virtual equity market.

Compared to the Western countries, online trading is still in its infancy in India. With trading turnover at around Rs. 10 crores per day from online trading compared to a combined gross turnover of around Rs. 9000-10,000 crores handled by the BSE and NSE together, online trading has a long way to go.

INTERNET TRADING IN INDIA

In the past, investors had no option but to contact their broker to get real time access to market data. The Net brings data to the investor on line and net broking enables him to trade on a click. Now information has become easily accessible to both retail as well as big investors.

The development of broking in India can be categorized in 3 phases:

1. Stock brokers offering on their sites features such as live portfolio manager, live quotes, market research and news to attract more investors.

2. Brokers offering on line broking and relationship management by providing and offering analysis and information to investors during broking and non-broking hours based on their profile and needs, that is, customized services.

3. Brokers (now e-brokers) will offer value management or services such as initial public offerings on line, asset allocation, portfolio management, financial planning, tax planning, insurance services and enable the investors to take better and well-considered decisions.

In the US, 82 per cent of the deals are done on line. The European on line broking market is expected to be of $8 billions and is likely to raise five fold by 2002. In India, presently Internet trading can take place through the order routing system, which will route client orders to exchanges trading systems for execution of trades on stock exchanges (NSE and BSE). This will also require interface with banks to facilitate instant cash debit or credit and the depository system for debit or credit of securities.

Objectives of Internet trading

Increase transparency in the markets.

Enhance market quality through improved liquidity, by increasing quote continuity and market depth.

Reduce settlement risks due to open trades, by elimination of mismatches.

Provide management information system (MIS).

Introduce flexibility in system, to handle growing volumes easily and to support nationwide expansion of market activity.

Besides, through Internet trading three fundamental objectives of securities regulation can be easily achieved, these are: Investor protection, creation of a fair and efficient market and, reduction of the systematic risks.

Factors to keep in mind while selecting online brokers:

Brokerage cost:

It is important to weigh up the subscription and trading costs charged by an online broker against benefits offered by the site. All online brokers display their charges on their sites. Some make sure you find the charges easily, while with others you will have to search a bit.

Safety:Please make sure site has 128-bit encryption to ensure safety of transaction online. ICICIDirect.com, 5paisa.com are few sites with 128-bit encryption. You normally get a secured Login id and password. It is always advisable to frequently change trading password. Ideally online trading site should be fully integrated. The greater the backward integration, the better it is for the customer. Ideally broking account, demat account and bank account should be linked electronically.Rate refresh:

Rate refresh has to be real-time with no time lag. The speed and reliability comes with huge investment in technology. It is always advisable to check rates of online broking sites with BSE/ NSE terminal rates.

Speed of execution:

System has to be fast and reliable that does just one job- executes your trades. The last thing you need is a site that is heavily congested with the users who are downloading heavy jpeg graphs or pulling the latest story why market is moving. The site should be one click wonder where squaring off all your positions or canceling all your pending orders takes one click and a confirmation of action.

Trading limit:

For trading, all sites provide 4 times buy and sell limit against margin money put in by customer. For delivery of shares, buying limit is equal to margin money put in by customer. Couple of sites also provides margin funding for buying of shares.

Free trial period:

Site should allow users free trial period to familiarize yourself with system before you decide to become trading member of the site.

Intraday chart/ historical chart:

The site should provide intraday chart tick by tick time and price data / historical chart for technical analysis by investors of particular scrip. Lot of people trade based on charting packages.

Challenges in Internet Trading:

For Internet trading to succeed it is imperative to have both, a robust business model as well as a comprehensive technology strategy. Some of the challenges are discussed: Transaction fulfillment--In the Net-based economy, it is both prudent and essential for a broker/intermediary to offer total solution to the clients at a single point. Total solutions would essentially mean offering interfaces with banks, depositories, information feeds, etc. for efficiency in trade completion and reducing duplication of client information. The service providers will have to go beyond the stage of mere order execution and emerge as "informediaries" rather than "intermediaries". This will not only ensure lower trading costs in terms of offering cross services but will also help in maximizing RoIs.

A true Internet trading system should deliver cost effective transaction fulfillment at a single point.

MAJOR PLAYERS OF INDUSTRY

India infoline Ltd. (5paisa.com)

Unicon investment solution .

Angel Broking Ltd.

Indiabulls Financial Services Ltd. Motilal Oswal Securities Ltd. (MOSt) Anand Rathi Securities Ltd.

Karvy Stock Broking Ltd.

CHAPTER 4

ABOUT INTERFACE BROKING

Fundamental analysis is the examination of the underlying forces that affect the well being of the economy, industry groups, and companies. As with most analysis, the goal is to derive a forecast and profit from future price movements. At the company level, fundamental analysis may involve examination of financial data, management, business concept and competition. At the industry level, there might be an examination of supply and demand forces for the products offered. For the national economy, fundamental analysis might focus on economic data to assess the present and future growth of the economy. To forecast future stock prices, fundamental analysis combines economic, industry, and company analysis to derive a stock's current fair value and forecast future value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either over or under valued and the market price will ultimately gravitate towards fair value. Fundamentalists do not heed the advice of the random walkers and believe that markets are weak-form efficient. By believing that prices do not accurately reflect all available information, fundamental analysts look to capitalize on perceived price discrepancies.

CHAPTER 5THEORETICAL ASPECT OF TOPIC

A. FUNDAMENTAL ANALYSISFundamental analysis is the examination of the underlying forces that affect the well being of the economy, industry groups, and companies. As with most analysis, the goal is to derive a forecast and profit from future price movements. At the company level, fundamental analysis may involve examination of financial data, management, business concept and competition. At the industry level, there might be an examination of supply and demand forces for the products offered. For the national economy, fundamental analysis might focus on economic data to assess the present and future growth of the economy. To forecast future stock prices, fundamental analysis combines economic, industry, and company analysis to derive a stock's current fair value and forecast future value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either over or under valued and the market price will ultimately gravitate towards fair value. Fundamentalists do not heed the advice of the random walkers and believe that markets are weak-form efficient. By believing that prices do not accurately reflect all available information, fundamental analysts look to capitalize on perceived price discrepancies.

GENERAL STEPS TO FUNDAMENTAL EVALUATION:Even though there is no one clear-cut method, a breakdown is presented below in the order an investor might proceed. This method employs a top-down approach that starts with the overall economy and then works down from industry groups to specific companies. As part of the analysis process, it is important to remember that all information is relative. Industry groups are compared against other industry groups and companies against other companies. Usually, companies are compared with others in the same group.

ECONOMIC FORECAST:

First and foremost in a top-down approach would be an overall evaluation of the general economy. The economy is like the tide and the various industry groups and individual companies are like boats. When the economy expands, most industry groups and companies benefit and grow. When the economy declines, most sectors and companies usually suffer. Many economists link economic expansion and contraction to the level of interest rates. Interest rates are seen as a leading indicator for the stock market as well. Once a scenario for the overall economy has been developed, an investor can break down the economy into its various industry groups.GROUP SELECTION (INDUSTRY ANALYSIS):If the prognosis is for an expanding economy, then certain groups are likely to benefit more than others. An investor can narrow the field to those groups that are best suited to benefit from the current or future economic environment. If most companies are expected to benefit from an expansion, then risk in equities would be relatively low and an aggressive growth-oriented strategy might be advisable. A growth strategy might involve the purchase of technology, biotech, semiconductor and cyclical stocks. If the economy is forecast to contract, an investor may opt for a more conservative strategy and seek out stable income-oriented companies. A defensive strategy might involve the purchase of consumer staples, utilities and energy-related stocks. To assess a industry group's potential, an investor would want to consider the overall growth rate, market size, and importance to the economy. While the individual company is still important, its industry group is likely to exert just as much, or more, influence on the stock price. When stocks move, they usually move as groups; there are very few lone guns out there. Many times it is more important to be in the right industry than in the right stock!NARROW WITHIN A GROUP:

Once the industry group is chosen, an investor would need to narrow the list of companies before proceeding to a more detailed analysis. Investors are usually interested in finding the leaders and the innovators within a group. The first task is to identify the current business and competitive environment within a group as well as the future trends. How do the companies rank according to market share, product position and competitive advantage? Who is the current leader and how will changes within the sector affect the current balance of power? What are the barriers to entry? Success depends on an edge, be it marketing, technology, market share or innovation. A comparative analysis of the competition within a sector will help identify those companies with an edge, and those most likely to keep it.COMPANY ANALYSIS:With a shortlist of companies, an investor might analyze the resources and capabilities within each company to identify those companies that are capable of creating and maintaining a competitive advantage. The analysis could focus on selecting companies with a sensible business plan, solid management and sound financials.

BUSINESS PLAN

The business plan, model or concept forms the bedrock upon which all else is built. If the plan, model or concepts stink, there is little hope for the business. For a new business, the questions may be these: Does its business make sense? Is it feasible? Is there a market? Can a profit be made? For an established business, the questions may be: Is the company's direction clearly defined? Is the company a leader in the market? Can the company maintain leadership? MANAGEMENT

In order to execute a business plan, a company requires top-quality management. Investors might look at management to assess their capabilities, strengths and weaknesses. Even the best-laid plans in the most dynamic industries can go to waste with bad management (AMD in semiconductors). Alternatively, even strong management can make for extraordinary success in a mature industry (Alcoa in aluminum). Some of the questions to ask might include: How talented is the management team? Do they have a track record? How long have they worked together? Can management deliver on its promises? If management is a problem, it is sometimes best to move on.

FINANCIAL ANALYSISThe final step to this analysis process would be to take apart the financial statements and come up with a means of valuation. Below is a list of potential inputs into a financial analysis.

Accounts PayableAccounts ReceivableAcid Ratio

AmortizationAssets - CurrentAssets - FixedBook ValueBrandBusiness CycleBusiness IdeaBusiness ModelBusiness PlanCapital ExpensesCash FlowCash on handCurrent RatioCustomer RelationshipsDays PayableDays ReceivableDebtDebt StructureDebt: Equity RatioDepreciationDerivatives-HedgingDiscounted Cash FlowDividendDividend CoverEarningsEBITDA Economic GrowthEquityEquity Risk Premium Expenses GoodwillGross Profit MarginGrowth IndustryInterest CoverInternationalInvestmentLiabilities - CurrentLiabilities - Long-termManagementMarket GrowthMarket ShareNet Profit MarginPage view GrowthPage viewsPatentsPrice/Book ValuePrice/EarningsPEGPrice/SalesProductProduct PlacementRegulationsR & DRevenuesSectorStock OptionsStrategySubscriber GrowthSubscribersSupplier RelationshipsTaxesTrademarksWeighted Average Cost of Capital

The list can seem quite long and intimidating. However, after a while, an investor will learn what works best and develop a set of preferred analysis techniques. There are many different valuation metrics and much depends on the industry and stage of the economic cycle. A complete financial model can be built to forecast future revenues, expenses and profits or an investor can rely on the forecast of other analysts and apply various multiples to arrive at a valuation. Some of the more popular ratios are found by dividing the stock price by a key value driver. Ratio

Price/Book ValuePrice/Earnings Price/Earnings/Growth Price/Sales Price/Subscribers Price/Lines Price/Page views Price/Promises Company Type

OilRetail NetworkingB2BISP or cable companyTelecomWeb site Biotech

This methodology assumes that a company will sell at a specific multiple of its earnings, revenues or growth. An investor may rank companies based on these valuation ratios. Those at the high end may be considered overvalued, while those at the low end may constitute relatively good value. PUTTING IT ALL TOGETHER :After all is said and done, an investor will be left with a handful of companies that stand out from the pack. Over the course of the analysis process, an understanding will develop of which companies stand out as potential leaders and innovators. In addition, other companies would be considered laggards and unpredictable. The final step of the fundamental analysis process is to synthesize all data, analysis and understanding into actual picks. CONCLUSION:Fundamental analysis can be valuable, but it should be approached with caution. If you are reading research written by a sell-side analyst, it is important to be familiar with the analyst behind the report. We all have personal biases, and every analyst has some sort of bias. There is nothing wrong with this, and the research can still be of great value. Learn what the ratings mean and the track record of an analyst before jumping off the deep end. Corporate statements and press releases offer good information, but they should be read with a healthy degree of skepticism to separate the facts from the spin. Press releases don't happen by accident; they are an important PR tool for companies. Investors should become skilled readers to weed out the important information and ignore the hype.B. TECHNICAL ANALYSISTechnical Analysis is the science of recording, usually in graphic form, the actual history of trading (price changes, volume of transactions, etc.) in a certain stock or in the Averages and then deducing from that pictured history the probable future trend.

Technical analysis is a method of evaluating securities by analyzing statistics generated by market activity, past prices and volume. Technical analysts do not attempt to measure a security's intrinsic value; instead they look at stock charts for patterns and indicators that will determine a stock's future performance.

Technical analysis has become increasingly popular over the past several years, as more and more people believe that the historical performance of a stock is a strong indication of future performance. The use of past performance should come as no surprise. People using fundamental analysis have always looked at the past performance of companies by comparing fiscal data from previous quarters and years to determine future growth. The difference lies in the technical analyst's belief that securities move according to very predictable trends and patterns. These trends continue until something happens to change the trend, and until this change occurs, price levels are predictable. There are many instances of investors successfully trading a security using only their knowledge of the security's chart, without even understanding what the company does.

However, although technical analysis is a terrific tool, most agree it is much more effective when used in combination with fundamental analysis.

THE BASIC ASSUMPTIONS:The field of technical analysis is based on three assumptions:

1. The market discounts everything.

2. Price moves in trends.

3. History tends to repeat itself.THE BASIC CHART CONSTRUCTION:

As shown in chapter-1, technicians do not believe that the price of securities and that the overall stock market moves in a random manner. Rather, they contend that a direct relationship exists between price movements in the past and those that will occur in the future. Their objective is to determine what this relationship is so that they will be able to predict accurately whether the stock market or a particularly securitys price will go up or down.

The primary tool that a technician uses is a picture or chart of a stocks price movement.

TYPES OF CHARTS:Technician use four types of charts

1. Bar chart

2. Line (or close-only) chart

3. Point and figure chart

4. Japanese candlestick chart Bar Chart

A bar chart is the most popular way to display security prices. A bar chart is made up of vertical bars, with each bar representing the price movement for a time period (i.e., hour, day, week, month, etc.). Hash marks on the left and right sides of the bar represent the opening and closing prices respectively. The top of the bar represents the high price and the bottom of the bottom represents the low price.

The advantage of using a bar chart over a straight-line graph is that it shows the high, low, open and close for each particular day. This is the type of chart that will be used to display various indicators throughout this tutorial. Line Chart

A line chart is the simplest type of chart. One price (typically the close) is plotted for each time period (i.e., day, week, month, etc.). A single, unbroken line connects each of these price points.

Point and Figure Chart

The point and figure chart is not well known or used by the average investor but it has had a long history of use dating back to the first technical traders. This type of chart reflects price movements and is not as concerned about time and volume in the formulation of the points. The point and figure chart removes the noise, or insignificant price movements, in the stock, which can distort traders' views of the price trends. These types of charts also try to neutralize theskewing effect that time has on chart analysis

When first looking at a point and figure chart, you will notice a series of Xs and Os. The Xs represent upward price trends and the Os represent downward price trends. There are also numbers and letters in the chart; these represent months, and give investors an idea of the date. Each box on the chart represents the price scale, which adjusts depending on the price of the stock: the higher the stock's price the more each box represents. On most charts where the price is between $20 and $100, a box represents $1, or 1 point for the stock. The other critical point of a point and figure chart is the reversal criteria. This is usually set at three but it can also be set according to the chartist's discretion. The reversal criteria set how much price has to move away from high or low in the price trend to create a new trend or, in other words, how much price has to move in order for a column of Xs to become a column of Os, or vice versa. When the price trend has moved from one trend to another, it shifts to the right, signaling a trend change.

Japanese Candlestick Chart

Candlestick charts have been around for hundreds of years. They are often referred to as "Japanese candles" because the Japanese would use them to analyze the price of rice contracts. Similar to a bar chart, candlestick charts also display the open, close, daily high and daily low. The difference is the use of color to show if the stock went up or down over the day.

Two different types of color is used. Green color is used when the ending price of the stock is higher than the opening price while the red color is used when the opening price is higher than the closing price.

THE BASIC CONCEPTS:There are two basic concepts of technical analysis through which we can predict the stock pattern or trend. Viz.

1. Support

2. Resistance

Support and resistance represent key junctures where the forces of supply and demand meet. In the financial markets, prices are driven by excessive supply (down) and demand (up). Supply is synonymous with bearish, bears and selling. Demand is synonymous with bullish, bulls and buying. These terms are used interchangeably throughout this and other articles. As demand increases, prices advance and as supply increases, prices decline. When supply and demand are equal, prices move sideways as bulls and bears slug it out for control.

WHAT IS SUPPORT?

Support is the price level at which demand is thought to be strong enough to prevent the price from declining further. The logic dictates that as the price declines towards support and gets cheaper, buyers become more inclined to buy and sellers become less inclined to sell. By the time the price reaches the support level, it is believed that demand will overcome supply and prevent the price from falling below support.

Support does not always hold and a break below support signals that the bears have won out over the bulls. A decline below support indicates a new willingness to sell and/or a lack of incentive to buy. Support breaks and new lows signal that sellers have reduced their expectations and are willing sell at even lower prices. In addition, buyers could not be coerced into buying until prices declined below support or below the previous low. Once support is broken, another support level will have to be established at a lower level.

WHERE IS SUPPORT ESTABLISHED?

Support levels are usually below the current price, but it is not uncommon for a security to trade at or near support. Technical analysis is not an exact science and it is sometimes difficult to set exact support levels. In addition, price movements can be volatile and dip below support briefly. Sometimes it does not seem logical to consider a support level broken if the price closes 1/8 below the established support level. For this reason, some traders and investors establish support zones.

WHAT IS RESISTANCE?

Resistance is the price level at which selling is thought to be strong enough to prevent the price from rising further. The logic dictates that as the price advances towards resistance, sellers become more inclined to sell and buyers become less inclined to buy. By the time the price reaches the resistance level, it is believed that supply will overcome demand and prevent the price from rising above resistance.

Resistance does not always hold and a break above resistance signals that the bulls have won out over the bears. A break above resistance shows a new willingness to buy and/or a lack of incentive to sell. Resistance breaks and new highs indicate buyers have increased their expectations and are willing to buy at even higher prices. In addition, sellers could not be coerced into selling until prices rose above resistance or above the previous high. Once resistance is broken, another resistance level will have to be established at a higher level.

WHERE IS RESISTANCE ESTABLISHED?

Resistance levels are usually above the current price, but it is not uncommon for a security to trade at or near resistance. In addition, price movements can be volatile and rise above resistance briefly. Sometimes it does not seem logical to consider a resistance level broken if the price closes 1/8 above the established resistance level. For this reason, some traders and investors establish resistance zones.

CONCLUSION:Charts are one of the most fundamental aspects of technical analysis. Regardless of the type of the chart used, the length of the period examined will vary depending on whether one is oriented to short-term, intermediate-term or long term investments. Short term roughly refers to the next three months, intermediate term is about three to six months from the present time, and long time is considered to be approximately six months to one year from the current period. Technicians often use hourly and daily charts to determine the short-term trend of security price movements. They use weekly charts for gaining an intermediate term perspective. And monthly and yearly charts help technicians examine the long term.

Apart from the type of chart used the main aspect of the trend forecasting is to identify the key levels of support and resistance establishment, where is established and where it breakout and where it breakdown etc.CHAPTER 6DATA ANALYSIS & INTERPRETATION

Data analysis refers to the analysis of our samples which we are taken for experimentation and interprete the same in your own meaningful words.Here for the purpose of Data Analysis we collect the data of various 10 companies from NIFTY 50 and on the basis of which we are trying to make evaluate or interpretetation to forecast the companies stock price and to know their chart pattern. Let us have a look on the companies which we took for the analysis, it is listed as below..Sr. No.Name Of CompaniesWeightage In Nifty

1

23

4

5

6

7

8

9

1011Reliance Industries Ltd.Bharti Airtel Limited

Infosys Technologies Ltd.ICICI Bank

Larsen and Tuobro Ltd.

Suzlon Energy Ltd.ITC Ltd.Tata Steel Ltd.Tata Motors Ltd.Satyam TechnologiesGrasim Industries

11.00 %7.15%

4.97%

3.89%

2.81%

2.62%

1.94%

1.64%

1.16%

1.41%

1.09%

complete

MERA SAPNA SABKA APNA

Reliance Industries Ltd.

A. FUNDAMENTAL ANALYSIS

Business Profile:

The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's largest private sector enterprise, with businesses in the energy and materials value chain. Group's annual revenues are in excess of USD 22 billion. The flagship company, Reliance Industries Limited, is a Fortune Global 500 company and is the largest private sector company in India.

Backward vertical integration has been the cornerstone of the evolution and growth of Reliance. Starting with textiles in the late seventies, Reliance pursued a strategy of backward vertical integration - in polyester, fibre intermediates, plastics, petrochemicals, petroleum refining and oil and gas exploration and production - to be fully integrated along the materials and energy value chain.

The Group's activities span exploration and production of oil and gas, petroleum refining and marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals), textiles and retail.

Reliance enjoys global leadership in its businesses, being the largest polyester yarn and fibre producer in the world and among the top five to ten producers in the world in major petrochemical products.

The Group exports products in excess of USD 7 billion to more than 100 countries in the world. There are more than 25,000 employees on the rolls of Group Companies. Major Group Companies are Reliance Industries Limited (including main subsidiaries Reliance Petroleum Limited and Reliance Retail limited), Indian Petrochemicals Corporation Limited and Reliance Industrial Infrastructure Limited.

Financial Highlights:

Particulars (03/07/2007)KEY FINANCIALSRS. (CRORE)

Industry: Refineries

Year End March2003200420052006

CMP : 1750Sales45704.151849.665918.880877.8

52WK high/low: 1785/940Operating Profit8178.869584.1812657.414299

Face Value: 10.0Interest1555.161434.721468.66877.04

Market Lot: 1.00Gross Profit6623.78149.4611188.713422

Listed at : BSE/NSEDepreciation2837.093247.023723.503400.91

BSE Group: AOther Income1187.601398.701603.38682.92

BSE Code:Tax869.901141.001497.001634.72

Market Cap: 245000 CroreNet Profit4104.315160.147571.589069.29

Book Value : 324Equity1395.921395.951393.091393.17

P/BV : 5.40Debt19758.320944.618784.521865.6

EPS(TTM): 78.28OPM %15.2915.7816.7716.83

P/E : 22.49GPM %14.4915.7116.9716.6

NPM%8.989.9511.4811.21

Shareholding Pattern[%]EPS (Rs.)28.6236.3153.3063.70

Promoters:50.98Dividend [%]5052.5075100

FI/FII :27.73Book Value198227.22270.43324.11

Public :21.29 Debt Equity Ratio0.73

0.690.570.49

OUTLOOK:

Geared for Exploration:RIL is all set to start off with its exploration avenue with huge reserves in Panna-Mukta-Tapti fields and KG BASIN. The Panna-Mukta-Tapti Field discoveries are going to increase the oil production of the company to 52,000 barrel per day and natural gas production to 6million square cubic meter per day. The KG BASIN produce of natural gas is set to hit the market in mid 2008 with 80 mmscmd. This produce will increase the share of exploration business to 6-8% of the company business in coming years.Retail robust:It is all set to start off its full fledge retail business with target of 100 million square feet space area. We estimate the company would achieve its target by 2012. 12-month down the line we can expect Reliance retail to add Rs 110 to the value per share. It can give an upside in valuation further with capital expenditure of Rs 25,000 Crore to spread retail network in around 800 cities.

Advantage EOU (export oriented unit):

The existing Jamnagar refinery is given the status of export oriented unit which is going to exempt it from payment of tax on export earnings. This will benefit the company since 58 % of earnings are generated through exports. This will improve the margins of the company.

Merger melody:

The petrochemical industry is consistently growing at 17%. The industry cycle is expected to face a slowdown in mid 2008 due to higher competition. Reliance geared itself to sustain its dominant position by the merger with IPCL. Both IPCL and RIL are enjoying dominant position and they will have a combined market share of 80%. The possible captive consumption of petrochemical intermediates produced by IPCL can give a synergy of around 5-7%

The company is trading at an attractive P/E multiple of 21.3x currently and estimated at 15.1x in FY08 and 11xinFY09. Hence the stock looks a decent BUY with a price target of Rs.2150.

B. TECHNICAL ANALYSIS

3 Months

From the above graph we can interprete that, in short term (3 months) Reliance Industries has support around Rs.1680 and faces the resistance at a price level of Rs.1800. The stock in the short term looks quite strong as the volume seems to be quite high and it is not breaking the support of Rs.1680, so in the short term the stock can be suggested to HOLD with the stop loss of Rs.1680. 12 Months

From the above graph we can interprete that, in long term (12 months) the stock has support around Rs.1300 and faces the resistance at a price level of Rs.1620 whereas the simple moving average of 200 days is 1420, the stock is able to trade above this level for a longer period making it chartically quite strong. The stock has also outperformed the benchmark nifty index and has potential to trade above Rs.2000 so it is better to maintain a BUY ON THE COUNTER.

Bharti Airtel Ltd.

A.FUNDAMENTAL ANALYSIS

Business Profile:

Bharti Airtel Limited is Indias largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBUs) - mobile services, broadband & telephone services (B&T) & enterprise services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles while the B&T business offers broadband & telephone services in 94 cities. The Enterprise services provide end-to-end telecom solutions to corporate customers and national & international long distance services to carriers. All these services are provided under the Airtel brand.



Industry: Telecom


CMP: 869Sales0.000.007,90311,228.7

52 WK h/l: 899/310Op. Pr.-37.80-37.672778.63854.8


Market Lot: 1.00Gross Profit-69.03-59.032461.63618



BSE Code : 532454Tax.05-0.12353.61273.71

Market Cap: 164862 CroreNet Profit0.220.371210.62012

Book Value: 38.71Equity1853.371853.371853.371893.88

P/BV : 22.45Debt1.18626.3649944796

EPS (TTM): 21.26OPM %--36.7035.22

P/E : 40.87GPM %--32.6933.11

NPM%--15.3217.92


Promoters : 60.9Dividend [%]----

FI/FII : 35.9Book Value26.0326.0324.4438.71

Public : 3.2Debt Equity Ratio0.010.070.600.83

OUTLOOK:

Mobile Services Business continues to drive the topline

Bharti Airtel recorded an impressive 58.1% YoY and a strong 9.8% QoQ

growth in its topline for the quarter. This was driven by the Mobile Services Business, which recorded an outstanding 75.8% YoY and a strong 12.9% QoQ growth in revenues.

Margin expansion

Due to scale benefits, Bharti recorded a 411 bps YoY and a 73bps QoQ margin expansion. The company saw continued cost leverage, as subscriber additions remained strong, leading to lower unit costs per subscriber.

Net profits rocket up on margin expansion

Due to the strong margin expansion seen, Bhartis net profits powered ahead by as much as 98.3% YoY.

The management has raised its capex estimates for FY2008 and now expects to expend US$ 3bn to US$ 3.5bn in the fiscal, up from an earlier estimate of US$ 2.5bn. This, in my view, suggests even greater visibility of growth, as it is an indication that the management believes there is strong potential in the hitherto untapped rural areas of the country and Bharti, being the market leader, expects to lead the industry into these areas. Of the capex, around 70% will be infused into the Mobile Services Business, where the company expects to add around 30,000 base transceiver stations (BTS) to the current 40,000, along with as much infrastructure sharing as is possible. The balance capex will be for Bhartis B&T Business, as well as the companys DTH operations, expected to commence operations this fiscal and the Sri Lanka roll-out. It can be recalled that Bharti had recently got the license to be the fifth mobile services operator in Sri Lanka.The company has seen its margins improving and it is also increasing its market share. Bharti has also entered in a joint-venture with Worlds Retail giant Wal-Mart to enter into Indian Retail-market which is growing very fast.At the CMP, the stock traded at a P/E of 17.6x FY2009E EPS of Rs 47.0. I have a HOLD recommendation on the stock, with a 12-month Target Price of Rs 1100.B. TECHNICAL ANALYSIS

3 Months

From the above graph we can interprete that , in short term (3 months) Bharti Airtel Ltd. has support around Rs.800 and faces the resistance at a price level of Rs.860. Recently the stock has been able to trade above the stiff resistance of Rs.860 so in short term the stock can be bought above Rs.860 with the stop loss of close below Rs.800 12 Months

From the above graph we can interprete that, in long term (12 months) Bharti Airtel Ltd. has support around Rs.700 and faces the resistance at a price level of Rs.890. It made a 52 week high of Rs.899 and 52 week low of Rs.310. The chart suggests that the stock had a good consolidation around the level of 800 to 860. Finally it has broken out and closed above Rs. 860(CMP@866). For a long term one can take a fresh position for at least 15 to 20 % upside.

Infosys Technologies Ltd.


Business Profile:Infosys Technologies Ltd. is a Bangalore based company promoted by Mr. N.R.Narayana Murthy and it has a market cap of more than 110000Cr. placing itself on the 5th position as far as Market capitalization of Indian companies in the NIFTY Index has concerned.

Infosys Technologies Ltd. provides consulting and IT services to clients globally - as partners to conceptualize and realize technology driven business transformation initiatives. With over 72,000 employees worldwide, Infosys use a low-risk Global Delivery Model (GDM) to accelerate schedules with a high degree of time and cost predictability.

As one of the pioneers in strategic offshore outsourcing of software services, Infosys has leveraged the global trend of offshore outsourcing. Even as many software outsourcing companies were blamed for diverting global jobs to cheaper offshore outsourcing destinations like India and China, Infosys was recently applauded by Wired magazine for its unique offshore outsourcing strategy it singled out Infosys for turning the outsourcing myth around and bringing jobs back to the US.Infosys also provides end-to-end business solutions that leverage technology. Infosys is also a company which has listed on the NASDAQ Index.

Financial Highlight:


Industry: Information Technology


CMP : 1920Sales3622.694760.8968609028

52WK high/low: 2439/1225Operating Profit1242.771574.7323262919

Face Value: 5.00Interest0.750.7511

Market Lot: 1.00Gross Profit1242.021573.9823252918

Listed at : BSE/NSEDepreciation188.95230.90268409

BSE Group: AOther Income105.86127.39172227

BSE Code: 500209Tax201227325315

Market Cap: 11000 CroreNet Profit957.931243.4719042421

Book Value:Equity33.1233.32135138

P/BV : 9.85 Rs.Debt----

EPS (TTM): 65.65OPM %31.3830.431.429.82

P/E : 29.25GPM %34.2833.0633.8932.32

NPM%26.4426.1127.7526.81

Shareholding Pattern [%]EPS (Rs.)142.76170.0168.9681.41

Promoters: 16.5Dividend [%]5402590230900

FI/FIIS : 42Book Value431.86488.21194.15249.89

Public : 41.5Debt Equity Ratio----

OUTLOOK:

The company had guided for revenues to hit a range of Rs 3,789cr to Rs 3,798cr in Q4, which it was unable to achieve (Rs 3,772cr top line). For FY2007, on the other hand, the management guidance of top line hitting Rs 13,910 Rs 13,919cr was also missed, with top line eventually hitting Rs 13,893cr. Thus, due to factors beyond its control (read rupee appreciation), the company has slipped on its guidance, resulting in the faade of invincibility being brought down.

Going forward, Infosys is expected to record a 31.9% CAGR in net sales from FY2007 to FY2009, and a 24.1% CAGR in EPS during the period, even as we expect margins to trend downwards each year by around 50bps. If we exclude the extraordinary item of the tax write back in FY2007 then net profits are expected to grow at a CAGR of 26.2% between FY2007 and FY2009. The trend of off shoring continues to play out unabated and we maintain our positive stance on the Indian Software Industry. Despite headwinds such as wage inflation, higher attrition rates and the possibility of adverse currency movements going forward, we believe that Infosys can maintain a 20% to 25% CAGR in earnings and I remain positive on the future prospects of the company.At the CMP the stock trades at a P/E of 20.0x FY2009E EPS of Rs 104.3. I maintain my BUY recommendation on the stock with a 12-month Target Price of Rs 2,400.

B.TECHNICAL ANALYSIS

3 Months

From the above graph we can interprete that, in short term (3 months) Infosys Technologies has support around Rs.1900 and faces the resistance at a price level of Rs.2050. The 30 days and 50 days moving averages are Rs.1958 and Rs.1955. In the short term, the trend of the stock is side ways and no fresh position is recommended until the stock sustains above Rs.2050. On the contrary, if it falls below 1900 then fresh short position can also be taken. 12 Months (1 Year)

From the above graph we can interprete that, in long term (12 months) Infosys has support around Rs.1900 and faces the resistance at a price level of Rs.2300. The stock has been an underperformer in the market and it is also trading below its 200 day simple moving average of Rs.2090. For a long term even if the stock can go above the short term resistance zone of Rs. 2050 to 2090 the stock is likely to face resistance around Rs.2200 and Rs.2300. So one can go long if the stock closes above Rs.2100 for a 12 months price-target of Rs.2400

Hum Hain Na

ICICI Bank Ltd.


Business Profile:

ICICI Bank was originally promoted in ICICI 1994 by ICICI Limited, an Indian financial institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46% through a public offering of shares in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in fiscal 2000.

ICICI Bank is India's second-largest bank with total assets of Rs. 3,446.58 billion (US$ 79 billion) at March 31, 2007 and profit after tax of Rs. 31.10 billion for fiscal 2007. ICICI Bank is the most valuable bank in India in terms of market capitalization and is ranked third amongst all the companies listed on the Indian stock exchanges in terms of free float market capitalization. The Bank has a network of about 950 branches and 3,300 ATMs in India and presence in 17 countries. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management.

The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in Singapore, Bahrain, Hong Kong, Sri Lanka and Dubai International Finance Centre and representative offices in the United States, United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established a branch in Belgium.Financial Highlights:


Industry: Banking


CMP : 969Interest Earned9002.399409.8914306.122994.2

52WK high/low: 1006/440Interest expended7015.256570.899597.4516358.5

Face Value: 10.0NII1987.1428394708.656635.7

Market Lot: 1.00Gross Profit----


BSE Group: AOther Income3,066.833,539.675,062.226,962.9

BSE Code: 532174Tax----

Market Cap: 87000 CroreNet Profit1,637.112,005.202,540.073,110.2


P/BV : 3.58Debt98848.8133363203605281766

EPS(TTM) : 31.93NIIM %1.701.932.242.22

P/E : 30.34GPM %----

NPM%----


Promoters : -Dividend [%]758585100

FI/FII : 93.1Book Value129.96170.34249.55270.35


OUTLOOK:

NIM improved to 2.66%: For Q4FY2007 Net interest Margins (NIMs) of ICICI Bank improved 6bps sequentially to 2.66% while declined by 13bps YoY from 2.79%. While for FY2007 NIMs declined by 17bps to 2.57% (2.74%) due to increased cost of funds. ICICI Banks Q4FY2006 NIMs excluding sell down gains stood at 2.47%.

Healthy growth in business: Total business of ICICI Bank has grown by 27% YoY to Rs 4,26,076cr (Rs 3,11,246cr). Advances of the bank have grown by 34% YoY Rs 1,95,866cr (Rs 1,46,163cr), which is an indicative of slow down in the credit growth as the growth is substantially lower than the 60% YoY growth in FY2006. On the other hand, Retail advances of the bank have clocked a growth of 39% YoY to Rs. 1,27,689cr (Rs 92,198cr), which is lower than 64% YoY growth in FY2006. Retail advances comprised of 65% of the total advances and has improved marginally from 62% in FY2006. The bank also continued its focus on agricultural lending and overseas business, which will continue to drive banks future growth. Deposits of the bank have jumped by 40% YoY to Rs. 2,30,510cr. Share of low cost remains largely unchanged at 22%. However, we believe that with the addition of over 150 branches, the banks CASA would improve leading to enhancement in NIMs.

Capital Adequacy: CAR of the bank for FY2007 was lower at 11.69% (13.35%), comprising of 7.42% of Tier I Capital and 4.27% Tier II capital. The decline in CAR is

due to higher growth in assets. Besides this a Foreign currency bonds worth US$ 750mn raised for upper Tier II were excluded from Tier II capital as the banks awaits clarification for certain terms of these bonds from RBI. Including these bonds, total capital adequacy would have been 12.81%. In order to augment its capital following the growing business, the bank has planned to raise Rs 20,000cr via ADR in FY2008.

Asset Quality: ICICI Bank has witnessed a significant increase in slippages mainly from the retail segment comprising of credit cards and personal loans, due to which its Gross NPAs have increased to Rs 4,850cr (Rs 2,963cr), while Net NPAs have increased to Rs 2,019cr (Rs 1,075cr) and Net NPA ratio of 0.98% (0.71%)

ICICI Bank continues to be on a strong growth trajectory with its retails focus. Though, after equity raising of Rs 20,000cr, the bank will witness pressure on its RoANW by about 4% in FY2008, but with the efficient utilization of funds and additional 150 branch license in FY2008, the bank will witness improvement in earning FY2009 onwards. The major concerns are slowing credit growth and the impact of increasing interest rate. Still I maintain a positive outlook on the stock in the long run and a BUY RATING with a price target of Rs.1100


3 Months

From the above graph we can interprete that, in short term (3 months) ICICI Bank has support around Rs.900 and faces the resistance at a price level of Rs.980. There is also a increase in the volume in the short term as per the charts so the stock has the potential to go up to the level of Rs.1000 so the short term suggests a BUY as also the Banking industry itself is looking quite Bullish. 12 Months

From the above graph we can interprete that, in long term (12 months) ICICI Bank has support around Rs.800 and faces the resistance at a price level of Rs.1000. Recently the stock has been able to break the barrier of 1000 with the decisive volumes. Moreover the stock by time and now also bounces back from its 200 day moving average of 870 which has formed a very good base. The long term thus suggests a Buy on the counter.

Larsen & Toubro Ltd.


Business Profile:

The evolution of L&T into the country's largest engineering and construction organizations is among the more remarkable success stories in Indian industry. The company was founded in Bombay (Mumbai) in 1938 by two Danish engineers, Henning Holck-Larsen and Soren Kristian Toubro - both of whom were strongly committed to developing India's engineering talent and enabling it to meet the demands of industry. Beginning with the import of machinery from Europe, L&T rapidly took on engineering and construction assignments of increasing sophistication. Today, the company sets engineering benchmarks in terms of scale and complexity.

Larsen & Toubro Limited (L&T) is a technology-driven engineering and construction organization, and one of the largest companies in India's private sector. It has additional interests in manufacturing, services and Information Technology. A strong, customer-focused approach and the constant quest for top-class quality have enabled the Company to attain and sustain leadership in its major lines of business across seven decades.

L&T has an international presence, with a global spread of offices. A thrust on international business over the last few years has seen overseas earnings growing to 18 per cent of total revenue. With factories and offices located around the country, further supplemented by a wide marketing and distribution network, L&T's image and equity extends to virtually every district of India. L&T believes that progress must necessarily be achieved in harmony with the environment. A commitment to community welfare and environmental protection constitute an integral part of the corporate vision.


Particulars (02/07/07)KEYFINANCIALSRs. (Crore)

Industry: Engineering - Turnkey ServicesYear End

MarchJune

2003200420052006

CMP : 2331Sales9941.129888.8813361.514994

52 WK h/l: 2364/902Operating Profit804.27554.29868.431101.4


Market Lot: 1.00Gross Profit546.23428.44747.61929



BSE Code:500510Tax76.60235.38302.12370.51



P/BV : 65.53Debt3176132418591453

EPS(TTM): 49.44OPM %10.659.848.259.74

P/E : 47.15GPM %8.058.577.358.59

NPM%4.365.395.165.76


Promoters : -Dividend [%]7580013751100

FI/FII : 55.58Book Value141.88220.45256.98335.57


Outlook:

L&T's engineering & construction track record consists of successful implementation of turnkey projects in major core and infrastructure sectors of Indian industry.

L&T is acknowledged as one of the top five fabrication companies in the world, with engineering and manufacturing capabilities that are among the most sought after in industry.

ECC - the Engineering Construction & Contracts Division of L&T is India's largest construction organization. Many of the country's prized landmarks - its exquisite buildings, tallest structures, largest industrial projects, longest flyovers, highest viaducts, longest pipelines have all been built by L&T.

L&T has a very healthy order book of more than Rs.28000 Crores and its capability in executing and delivering the orders is also quite good. In a country like India where there is a huge demand for infrastructure Construction & Engineering will always remains a hot sector where L&T is placed.

L&T has also seen its margin improving on QoQ and YoY basis. Also there will be unlocking of value as the company plans IPO of its 4 companies.

Looking at the above factors like huge demand for infrastructure in the country, healthy order book and unlocking of value happening, it will benefit the long-term shareholders.

So, I maintain a BUY on the stock with the price-target of Rs.3000.


3 Months

From the above graph we can interprete that, in short term (3 months) Larsen & Toubro has a very good support at Rs.1890 and it has also gone above a likely resistance of Rs.2000. Now the stock has gone into the uncharted territory way above Rs.2300 and so for a short term the stock can go further up until it faces supply pressure. At current we maintain a HOLD on the stock with the stop loss of Rs.2000. 12 Months

From the above graph we can interprete that, in long term (12 months) Larsen & Toubro has support around Rs.1600 and it was facing the resistance at a price level of Rs.2020. The stock has been an out performer in the market and also it is from outperforming sector Capital Goods. Technically the longer term charts look quite attractive and the stock has a capability to go further up after some consolidation around Rs.2500 to Rs.2700 to the target zone of Rs.3000 to 3050.

Suzlon Energy Ltd.


Business Profile:

Suzlon Energy Limited traces its roots back to 1995, when the company took its first step on the renewable energy stage with its incorporation. Suzlon began its journey to the forefront of the wind energy industry with a small but significant project to supply wind turbine generators for a 3.34 MW wind farm project in Gujarat, India. In little over a decade, Suzlon has grown to rank as the world's 5th leading and India's and Asia's leading manufacturer of wind turbines, with over 2,000 MW of wind turbine capacity supplied in India and across the world. The company registered revenues of USD 867 million, and a net worth of USD 617 million, CFS FY 2006, with a current order book exceeding USD 1.7 billion.

Suzlon today develops and manufactures technologically advanced, high-performance and cost-efficient wind turbines, to meet the diverse needs of customers all around the world. In India, Suzlon offers customers' end-to-end wind energy solutions, including wind resource mapping, site identification, site development and installation, and finally operations & maintenance services. This allows Suzlon to offer Indian customers economies of scale, and eliminates the need for customer involvement in the complex process of wind farm development.

Windfarms - Suzlon has developed and implemented several large-scale windfarms throughout India using the 'integrated solutions' approach. The principal advantage of this approach is the economy of scale: the larger the farm and more the number of WTGs - the lower the infrastructure cost per-wind turbine. Similarly, larger projects have lower operations and maintenance costs per kWh due to the efficiency obtained in managing a larger windfarm.



Industry: Electric Equipment

Year End

March2004200520062007

CMP : 1438Sales333791.151917.53788.4



Market Lot: 1.00Gross Profit49.11117.93408.15879.25



BSE Code: 532667Tax2.532.8130.9881.47

Market Cap : 41380 CroreNet Profit65.22145.90361.46821.19

Book Value : 97.63Equity24.3586.92287.53287.76

P/BV : 14.73Debt220.66322.54335.371136.6

EPS (TTM) : 36.88OPM %19.8924.6526.4824.06

P/E : 38.99GPM %16.6422.5025.0422.17

NPM%15.3618.8521.6819.72


Promoters : 69.73Dividend [%]501004050

FI/FII : 21.92Book Value234.90157.4493.7197.63


OUTLOOK:

Suzlon as a company is in a very booming sector of capital goods and it is also in wind turbine energy. Though its financial performance has not been quite extra-ordinary and the burden it will face on its balance-sheet because of that RE-POWER bid (the company which Suzlon acquired), in a longer period, Suzlon is likely to do well as the sector is quite demanding and also the synergies with the RE-POWER will come into play which all augurs for a very good growth for the company.

Moreover, Suzlon has also been able to hold its profit margins on YoY basis which is quite encouraging. So, we maintain HOLD on the stock with the target price of Rs.1700.


3 Months

From the above graph we can interprete that, in short term (3 months) Suzlon Energy has support around Rs.1150 and faces the resistance at a price level of Rs.1410. The 30 days simple moving average is 1432. At the current level of 1498, it seems that the stock has been facing the resistance at Rs.1500 which it is not able to cross. So we are of the view that those who hold the stock should book some of their profits and wait for the stock to correct for re-entry. 12 Months

From the above graph we can interprete that, in long term (12 months) Suzlon Energy has a support around Rs.980-1000 and faces the stiff resistance at a price level of Rs.1500.The stock has been quite volatile in its movement. If Suzlon is able to stay above the 1500 level with decisive volumes then and then only it can give a definite up move and can meet the target-zone of Rs.1650+ .

Imperial Tobacco Company (ITC)


Business Profile:

ITC was incorporated on August 24, 1910 under the name of 'Imperial Tobacco Company of India Limited'. ITC is one of India's foremost private sector companies with a market capitalisation of nearly US $ 15 billion and a turnover of over US $ 4.75 billion.

ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Greeting Cards, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel and Greeting Cards.

ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 2.8 billion in the last decade).

ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is aggressively pursuing emerging opportunities in providing end-to-end IT solutions, including e-enabled services and business process outsourcing.

ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems.



Industry: FMCG


CMP : 156Sales1181513349.51622419505

52WK high/low: 196/130Operating Profit2,365.62,791.93282.63,955.7

Face Value:1.00Interest34.1850.8021.1016.04




BSE Code: 500875Tax726.21836.00988.821,226.7

Market Cap: 58,727.94 CroreNet Profit1593.192191.402235.352699.97


P/BV : 5.65Debt120.85245.36119.73200.88

EPS(TTM) : 6.64OPM %21.9622.7522.0522.07

P/E : 23.51GPM %21.6722.3721.9221.99

NPM%13.4813.7613.7813.84


Promoters : -Dividend [%]200.00310.00265.00310.00

FI/FII : 50.2Book Value256.35315.6323.9727.59


OUTLOOK:Strong performance:

ITC reported a strong earnings growth in the third quarter, with net sales growing by 23.8% to Rs 3165.6cr (Rs 2556cr), and net profit growing by 23.2% to Rs 717.4cr (Rs 582.3cr). For the 9MFY2007, the turnover grew by 27.1% to Rs 8903cr (Rs 7006.1cr), and the PAT grew by 19.6% to Rs

2049.3cr (Rs 1712.9cr). The driver behind this momentum was the non-cigarette business, which grew by 31% during the quarter, and now accounts for 52% of the companys net turnover. The EPS for the quarter stood at 1.9 (1.5), and at 5.5 (4.6) for the 9MFY2007.

Growth across segments: For Q3FY2007, the cigarettes segment grew by 14% to Rs 3279cr (Rs 2881cr), branded packaged foods by over 65% to Rs 437cr (Rs 261cr), hotels by 28% to Rs 282cr (Rs 219cr), paper by 11% to Rs 543cr (Rs 490cr), the agri business by 20% to Rs783cr (Rs 655cr), lifestyle retailing

by 38%, stationery by 27% and safety matches by 8%. However, the non-cigarette FMCG business continued its negative trajectory, with a loss of Rs.46.49cr for Q3FY2007.Margins remain stable: For Q3FY2007, the overall Operating Margin remained stable at 34.2% (34.4%), with a nominal decline of 20bps. The main factor behind this was the increase in input costs, by 190bps, from 40.7% of sales in Q3FY2006 to 42.6% in Q3FY2007. The PAT margin over the quarter also remained stable at 22.7% (22.8%). For the 9MFY2007, however, the OPM declined by 200bps to 34% (36%), on the back of a 390bps increase in input costs; the PAT margin fell to 23% (24.4%).

At the CMP, ITC is trading at 23.7x its FY2007E EPS of Rs 7.5 and 19.4x its FY2008E EPS of Rs 9.1. We expect ITC to maintain its strong growth momentum over FY2007 and FY2008, particularly in the agri-business and branded packaged food segments. Additionally, the augmented paper capacity should begin to show its impact on the bottom-line from early FY2008. At its current valuations, ITC appears as an attractive prospect and therefore, we recommend a Buy on the stock with a Target Price of Rs 206.


3 Months

From the above graph we can interprete that, in short term (3 months) ITC is having a support at Rs.150 and it is facing a resistance at a price level of Rs.160. The 50 day simple moving average and exponential moving average of the stock is 157. In the short term, the stock seems to be in the consolidation phase from 150 to 160. A close above Rs.160 with decisive volumes would be a BUY signal with the short term price target of Rs.170+ so; we believe that one can BUY the stock with the strict stop-loss of Rs.150. 12 Months

From the above graph we can interprete that, in long term (12 months) ITC has support around Rs.140 to Rs.145 level and faces the resistance at a price level of Rs.190. The stock has been an underperformer in the market but it seems to have a very strong support around 140 to 145 level and also it has tested this support quite a few times with very high volumes. Any good views from the fundamental side would lift the stock up and it can rally up to Rs.190. So, we recommend to BUY the stock at the current level as it has very limited downside.

Tata Steel Ltd.


Business Profile:

Established in 1907, Tata Steel is Asia's first and India's largest private sector steel company. Tata Steel is among the lowest cost producers of steel in the world.Its captive raw material resources and the state-of-the-art 5 MTPA (million tones per annum) plant at Jamshedpur, in Jharkhand State, India give it a competitive edge. Determined to be a major global steel player, Tata Steel has recently included in its fold Nat Steel, Asia (2 MTPA) and Millennium Steel (now Tata Steel Thailand) (1.7 MTPA) creating a manufacturing network in eight markets in South East Asia and Pacific rim countries. Soon the Jamshedpur plant will expand its capacity from 5 MTPA to 7 MTPA by 2008. The Company plans to enhance its capacity, manifold through organic growth and investments. The Company's wire manufacturing unit in Sri Lanka is known as Lanka Special Steel, while the joint venture in Thailand for limestone mining is known as Sila Eastern.

Tata Steel's products are targeted at the quality conscious auto sector and the burgeoning construction industry. With wire manufacturing facilities in India, Sri Lanka and Thailand, the Company plans to emerge as a major global player in the wire business.Tata Steel's products include hot and cold rolled coils and sheets, galvanised sheets, tubes, wire rods, construction rebars, rings and bearings. In an attempt to 'decommoditise' steel, the company has introduced brands like Tata Steelium (the world's first branded Cold Rolled Steel), Tata Shaktee (Galvanised Corrugated Sheets), Tata Tiscon (re-bars), Tata Bearings, Tata Agrico (hand tools and implements), Tata Wiron (galvanised wire products), Tata Pipes (pipes for construction) and Tata Structura (contemporary construction material). The company has launched the Customer Value Management initiative with the objective of creating complete understanding of customer problems and finding solutions jointly. The company's Retail Value Management addresses the needs of distributors, retailers and end consumers. The company has also launched India's first steel retail store - steeljunction - for making steel shopping a happy and memorable experience.Financial Highlights:

Particulars (05/07/2007)KEY FINANCIALSRs. (Crore)

Industry: Steel- Large

Year End

March2004200520062007

CMP : 605Sales11920.915871.117140.219757.8


Face Value: 10Interest227.12228.80174.51251.25




BSE Code: 500470Tax919.741823.121733.582039.50



P/BV : 2.52Debt3382.212739.72516.159645.33

EPS (TTM) : 71OPM %29.5138.7236.1137.11

P/E : 8.53GPM %27.6137.2835.0935.84

NPM%14.6521.8920.4621.37


Promter: 30.52Dividend [%]100130130155

FI/FII : 39.27Book Value122.32127.51176.19240.22


OUTLOOK:

Strong Q4FY2007 performance:

Tata Steel reported a strong all-round performance for Q4FY2007. Net Sales rose 21.5% yoy to Rs4,980.4cr (Rs4,100.5cr) on the back of better realisations, which were higher by around 20% yoy. Volume sales inched up only marginally to 1.260 MTPA (1.255 MTPA), up 0.4% yoy. Exports during the quarter were lower by 10.2% yoy at Rs480.4cr (Rs534.8cr) primarily on account of lower export volumes.

OPMs register a sharp rise:

Since Topline was solely driven by higher realisations, impact of this was clearly visible on the Operating Margins, which improved by 640bps to 38.2% (31.8%). Barring some cost pressures witnessed on the Staff Costs and Raw Materials front, all the other operating heads were under check. Further, Tata Steels consistent focus on increasing the contribution of revenues from branded products also helped matters.

Net Profit jumps 41% yoy:

Despite higher Interest and Depreciation charges, Net Profit increased by 40.9% yoy to Rs1,103.5cr(Rs783.1cr). However, EPS growth for the quarter was restricted at 34.4%to Rs19 per share as Tata Steel had allotted 2.7cr shares to Tata Sons in July 2006.

Consolidated performance:

Tata Steel reported a Consolidated Net Profit of Rs964.4cr (Rs813.2cr) in Q4FY2007 on a Turnover of Rs7,469.7cr (Rs5,325.6cr) translating into a yoy growth of 18.6% and 40.3%, respectively. Operating margins for Q4FY2007 at 26.3% (26.1%) were relatively much lower compared to the standalone performance as margins from NatSteel Singapore and Tata Steel Thailand (erstwhile Millennium Steel) operations are much below Tata Steels standalone margins. This is, however, expected to improve going forward as the company plans tosupply billets from its Indian plants to be converted into finished products.

At the CMP of Rs605, the stock trades at a P/E of 6.7x and 8.1x its FY2008E and FY2009E EPS, respectively. While the biggest risk remains a longer-than-expected strength in the steel prices, in view of the concerns in the offing for the steel sector as a whole and Tata Steel in particular as the interest burden takes its toll on the consolidated financials of the company. On the other hand, taking into consideration the synergies coming with the Corus deal and excellent management by the TATAs, we maintain a BUY on TATA STEEL with a price target of Rs.800

B. TECHNICAL ANALYSIS 3 Months

From the above graph we can interprete that, in short term (3 months) TATA STEEL has support around Rs.580 and faces resistance at a price level of Rs.660. Like its earlier pattern of support around Rs.500 and resistance at Rs.580, the stock is now having a huge support at Rs.580 (its previous resistance). At the CMP of Rs.623, if the stock is able to sustain above Rs.660, then we maintain a fresh BUY on the stock for a target-zone of Rs.700 to Rs.725. 12 Months

From the above graph we can interprete that, in long term (12 months) TATA STEEL has a strong support at Rs.400 and facing a resistance at Rs.680. After a long time underperformance the has bounced back to Rs.620 from the support-level of Rs.400. The stock is likely to consolidate around this level for sometime and then it can start its up move. We maintain a BUY on TATA STEEL with the price-target of Rs.750+.

Tata Motors Ltd.


Business Profile:

Tata Motors Limited is India's largest automobile company, with revenues of Rs. 32,426 Crores (USD 7.2 billion) in 2006-07.There are about 22000 employees working in the company. It is the leader by far in commercial vehicles in each segment, and the second largest in the passenger vehicles market with winning products in the compact, midsize car and utility vehicle segments. The company is the world's fifth largest medium and heavy commercial vehicle manufacturer, and the world's second largest medium and heavy bus manufacturer.

Established in 1945, Tata Motors' presence indeed cuts across the length and breadth of India. Over 4 million Tata vehicles ply on Indian roads, since the first rolled out in 1954. The company's manufacturing base is spread across India - Jamshedpur (Jharkhand) in the east, Pune (Maharashtra) in the west, and in the north in Lucknow (Uttar Pradesh) and Pantnagar (Uttarakhand). A new plant is being set up in Singur (close to Kolkata in West Bengal) to manufacture the company's small car.

Tata Motors is also the first company from India's engineering sector to be listed in the New York Stock Exchange (September 2004).



Industry: Auto-LCVs / HCVs


CMP : 698Sales15165.820152.023673.431486.9

52WK high/low: 974/635Operating Profit1,449.631,759.582,173.892,829.6





BSE Code: 500570Tax482.00414.95524.50659.72

Market Cap: 26903.3 CroreNet Profit810.341,236.951,528.881,913.4


P/BV : 3.93Debt1,259.772,495.422,936.844,009.1

EPS(TTM) : 46.15OPM %12.3811.5112.1111.20

P/E : 15.12GPM %11.0410.4310.8710.03

NPM%5.346.146.466.08


Promoters : 33.43Dividend [%]80.00125.00130.00150.00

FI/FII : 56.27Book Value101.69113.64143.93177.57


OUTLOOK:

Capacity Expansion and New Launch:

Tata Motors has increased it capital expenditure to Rs12,000cr from Rs10,000cr previously spread over the next four years. Capex will comprise Rs8,000cr for new product development and Rs4,000cr for capacity expansions. The company plans to source Rs7,500cr from internal accruals and raise the balance Rs4,500cr from issuance of suitable instruments in the domestic/overseas markets. The company is looking at increasing capacity across all products over the next 12-15 months. The company would also be launching new models and platforms in passenger cars, trucks and buses besides giving a face-lift to the existing models including the Indica replacement platform.

Tata Motors mentioned in its analyst meet that it is witnessing slackening of implementation of the ban on overloading of trucks in some states. If this trend continues, there exists a downside risk to its FY2008 growth estimate for M&HCVs. While it is now more or less certain that FY2008 will see mid-single digit volume growth at best for Tata Motors in both CVs and PVs, FY2009 should be a better year if overall economic growth in India stays strong. In our view, if freight demand stays strong, any over-supply situation in the CV industry will likely get resolved by Q4FY2008, paving the way for better growth in FY2009.Going forward, investments in the subsidiaries would unlock the real value of the stock in the long term. Based on consolidated estimates, the company is likely to report an EPS of Rs65 and Rs72 for FY2008E and FY2009E, respectively. On the basis of it , I have arrived at the Target Price of Rs900. In view of the current weakness in the stock due to near-term growth concerns it is an excellent opportunity to Buy the stock with a long-term perspective. I maintain my BUY rating on Tata Motors with a Target Price of Rs900.


3 Months

From the above graph we can interprete that, in short term (3 months) TATA Motors has a very support at Rs.650 and it has been facing resistance at Rs.710. Finally it has been able to sustain above Rs.710(the resistance); which suggests a fresh upmove of at least 8 to 10% from the current-level so we maintain a BUY on the stock for a Target of Rs.770. 12 Months

From the above graph we can interprete that, in long term (12 months) TATA Motors has a support at Rs.650 and faces resistance at a price level of Rs.800. The longer term charts of the stock are not very encouraging as it has got a lot of resistances at Rs.800, the next resistance at Rs.900 and a very strong resistance at Rs.990. So we are of the view that those holding the stock should exit (sell) it on the rallies and no fresh position is recommended.

Satyam Computer Services Ltd.


Business Profile:

Satyam Computer Services Ltd. is a leading global consulting and IT services company, offering a wide array of solutions customized for a range of key verticals and horizontals. From strategy consulting right through to implementing IT solutions for customers, Satyam straddles the entire IT space. It has excellent domain competencies in verticals such as Automotive, Banking & Financial Service, Insurance & Healthcare, Manufacturing, Telecom-Infrastructure-Media-Entertainment-Semiconductors (TIMES). As a diverse end-to-end IT solutions provider, Satyam offers a range of expertise aimed at helping customers re-engineer and re-invent their businesses to compete successfully in an ever-changing marketplace.

Satyam's network spans 55 countries, across 6 continents. Nearly 40,000 dedicated and highly skilled IT professionals work in development centers in India, the USA, the UK, the UAE, Canada, Hungary, Singapore, Malaysia, China, Japan and Australia and serve over 558 global companies, including over 163 Fortune 500 corporations.

.

Services Offered:

Application Development and Maintenance, Business Intelligence and Data Warehousing (BI&DW), Business Process Outsourcing (BPO), Consulting and Enterprise Solutions, Embedded Services, Engineering Solutions, Enterprise Storage Solutions, ERP, Infrastructure Management Services, Managed IT Services, Quality Consulting, GIS Technology, High-Tech Solutions, MES and LIMS, Silicon Design Services, Six Sigma Consulting.

Financial Highlights:Particulars (03/07/2007)KEY FINANCIALSRS. (CRORE)

Industry: Computers - Software LargeYear End March2004200520062007

CMP : 471Sales2,541.543,464.224,634.316,228.4

52WK high/low: 524/293Operating Profit660.90869.281,191.251,529.1





BSE Code: 500376Tax106.15116.74206.14150.00

Market Cap: 31,476.36 CroreNet Profit555.79750.261,239.751,423.2


P/BV : 5.43Debt7.309.8712.5713.79

EPS(TTM) : 20.77OPM %30.4728.0528.2527.47

P/E : 22.70GPM %30.4428.0328.2027.34

NPM%21.8721.6621.8722.85


Promoters : 8.8Dividend [%]200.00250.00350.00175.00

FI/FII : 58.85Book Value81.61100.77133.5786.65


OUTLOOK:Satyam for Q4FY07 reported a sequential revenue growth of 7.1%, with volumes aiding the growth by 8.1% and billing rates inching by 0.7%, on top of 0.3% growth achieved in Q3. However rupee appreciation to the tune of 1.7% in the JFM quarter over Q3, took away some of the shine which resulted the margins contracting by 90bps and another 70bps were lost on account of wage inflation. To validate the same, staff costs to

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