Monday, August 27, 2012

NIFTY CRUCIAL LEVELS!!!!


The August month saw a decent rally in equities. From a low of 4770 on 4th June-12 till date the Nifty could scale up day after day. May readers might have remembered the recommendation made earlier to stick with BULLs rather than with BEARS till the market reaches 5365 leve. I also mentioned, Nifty may touch 4225 level. Now Nifty is in over bought situation. Last week Infosys, TCS, HCL Tech and HLL along with pharma majors, could take it to float above 5400, crossing high a 5425 level for 3 days in a row.
This week being the F&O closing week, the banking sector may see a fall, especially due to the Euro problems.
The stocks to watch for this week: Bull unwinding may consider in stocks like HLL, Ranbaxy, Cipla and in Banking majors. The Bank Nifty is weak below 10340 levels and will gain momentum above 10475. The Nifty is strong above 5390 level, but the closing shall be above 5420 level for further gains. The Nifty close below 5340 level will help the bears to gain temporarily. Last month Nifty closed at 5040 level and now a gain over 350 points available to BULLS. The stocks performed beyond any body expectation in stocks like Ranbaxy, Mc Dowell and JSW steel. The similar performance took place in M&M and HLL. So they tend to correct for want of support at the higher level.................................. 

DEBT KILLS AIRTEL-BHARATI.. The operational issues are not a problem where as the South Africa acquisition has become a burden to carry on its shoulders. The dollar debt is threatening and not able to meet the mounting interest pressure also failed in balancing the rupee depreciation not able to edge to its best. Bharati rate of growth, ARPU are contacting and but overall sales performance is acceptable in this kind of a difficult situation and global environment. We can see the cruel state of struggle existing in the telecom players for the market share and the new entrants are working hard to grab the users through number portability. The 2G scam is still haunting both the industry and government and the regulators. The 3G-4G/LTE service expansion was cripped for want of funding and the winners are also not sure of what will happen and when!!!! 
Despite the entire crippled environment existing now in the Telecom sector, Bharati is going to do very well in future once the clouds are faded. The very big opportunity stored in for Bhatai is Mobile banking and the entertainment. The huge infra business existing ( for now it failed to attract big investments- trying to list the arm), future sustained revenue is assured. So Bharati will merge the arm after 3-5 years. The stock will again see a huge demand. The stock will certainly get investor support at Rs 220-25, from there a double in 5 years is a safe and best returns a large cap can offer.

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