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2694. kisor Jha Jan 24, 2013 8:32:50 AM IST |
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kisor Jha's - Stock Comments, IPO Comments, Public Profile
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Good Morning Friends.
A butterfly lives only 14 days but still it flies joyfully capturing many hears. Each moment in life is precious. Be happy and winning hearts.
Once again the game is continue i.e. neither I won nor you defeated. One or two days Nifty moves up slowly-slowly and one day it back to previous closes.
So today there’s no major discussion as market not showing comfortable sign to move up and investors are cautious & are sideline ahead of major event of RBI policy.
Investors also prefer to sideline ahead of US Debt. Voting. The bill to extend the US debt limit for 4 months would today come under a vote in the Republican controlled US Hoof Representatives. The move that would allow US to borrow until May 19 would be signed by the White Hoif it clears Congress.
The Indian equity market, after sliding almost 50 points the Nifty staged a smart recovery and ended near the day’s high.
Selling pressure in Realty, PSU, Consumer Durables, Auto and the Metals stocks weighed on the market. The index managed to keep afloat on the back of two bellwether stocks – Bharti Airtel and ICICI Bank.
Finance minister has been reiterating that the 5.3 percent fiscal deficit target will be met. It has been learnt from the sources that there is likely to be a cut of Rs 1.5 lakh crore in plan expenditure. Plan expenditure for this year was at Rs 5.21 lakh crore, so that is almost a 30 percent cut. The finance ministry is putting in place stringent guidelines for different ministry saying that all utilisation certificates for a particular scheme have to be in place before funds are released and therefore the finance ministry is not releasing funds easily.
Considering the deficit figures this year, it is likely to be Rs 30 crore short on the spectrum front and was estimated at Rs 40,000 crore. Disinvestment is likely to be met at about Rs 26,000 crore versus Rs 30,000 crore which was estimated.
The oil subsidy is likely to be overshot by about Rs 50,000 crore. Rs 30,000 crore has already been promised to oil marketing companies (OMCs), the finance ministry is likely to give another Rs 20,000 crore. If one looks at the numbers along with this cut in plan expenditure they will meet 5.3 percent fiscal deficit target and could be lower. The government may reduce the borrowing for this fiscal if that happens. (MoneyControl.com)
MG’s Note – Today I have added more companies to stock outlook with hope that this info will guide you to understand stock & sector specific moves in recent and what kind of moves in coming days.
Gainers – TCS, HUL, Sun Pharma, Tata Steel, Tata Motors , Sterlite Inds, Hindalco Inds, Tata Motors were among gainers in Sensex and Nifty.
Losers - RIL, Infosys, Wipro, Bajaj Auto, NTPC, SBI, Hero MotoCorp, Bharti Airtel, Dr Reddys Lab, ICICI Bank, Tata Power were the major losers in Sensex and Nifty.
Sectoral – Realty, PSU, Consumer Durables, Auto and the Metals were the major gainers in Sensex and Nifty.
On Domestic Front -
Research firm CNI Research says a whopping Rs 61,000 crore of investor money is blocked due to suspension of companies for various reasons at the bourses.
On Global front –
Investment bank Goldman Sachs Wednesday reaffirmed its Nifty target of 7000 by the calendar-end, fuelled by a strong recovery in corporate earnings. For 2013, we expect inflation to remain elevated at 7.2%, but investors are likely to focus on the moderation our forecast suggests from the 2012 rate of 7.5%, which bodes positively for equities.
===================== MARKET OUTLOOK =====================
Right now market is undergoing a trend of consolidation and one need to take a cautious stance for fresh longs. Nifty is inching higher but most of indicators are showing overbought, so now it needs to consolidate or a correction before making fresh high.
Today will be day of L&T, company will post its Q3 nos today i.e. on Thu 24 Jan, this week results of Marutu Suzuki and Cairn India are also expected.
The INDIA VIX on NSE was down 1.58% and ended at 13.67 against previous close of 13.89.
FNO PCR is 1.05 against previous close 0.96.
Indian Rupee got stronger against USD and was trading at 53.67 against its previous close 53.81.
S&P 500 (US) was trading higher at 1485.99 up 0.01 then its previous close at the time of writing M Bells.
Now next trigger is RBI policy on 29 Jan 12. Here please remember I am expecting maximum possibility for a 25bps cut in the repo rate in the upcoming monetary policy.
======================= NIFTY OUTLOOK ========================
The outlook for the near term remains a bit cautious. If The Nifty cracks below the 6000 psychological mark and stays there for a considerable period of time it is likely to see a bearish movement.
Market consolidating, now its time to lighten your portfolio and don’t make any fresh longs. Keep 5935 as SL for Longs.
Buying in selective stock will continue.
Nifty is in range of 5935-5990-6040-6090-6150 for current week.
Resistance – 6075 – 6097 – 6124 and Support – 6027 – 5999 -5978
Opening seems a bit down say around 10+ points ahead of US Debt. Worry and profit booking.
======================== STOCK OUTLOOK ======================
(Stock outlook needs to watch stock movement carefully and then one can bet after having a look, I tried to put related info which will help you in taking positions.)
HDIL –
The shares of Housing Development & Infrastructure (HDIL ) cracked as much as 15.8 percent on Wednesday after vice chairman and managing director Sarang Wadhawan offloaded partial stake in the company. He sold 5 million shares worth Rs 57 crore in secondary markets on Tuesday, reducing his stake to 0.99 percent from 2.19 percent.
"We are aiming at debt reduction this move was primarily to fund the land acquisition we had entered into about a year back," Wadhwan explained to CNBC-TV18. No details were shared about this land purchase but the company expects this acquisition to add substantial value.
HDIL’s debt currently stands at Rs 4,000 crore, but the company is confident of reducing it significantly in quarters ahead.
MG’s view – Stock fell down significantly and profit booking was also part of it, as we can see after a good move profit booking is also seen in realty stocks. Like Indiabulls Realty has not shown any kind of strength in spite of having posted very good numbers.
So, overall the profit booking has all been seen across the board whether it’s any stocks Peninsula Land, Anant Raj Industries or Unitech.
So most probably stock wont fall much from here and then can keep continue its onward journey.
Syndicate Bank –
Bangalore based state-owned lender Syndicate Bank ''s third quarter (October-December, FY13) net profit surged more than 50.3% year-on-year to Rs 508 crore, boosted by a one-off tax refund of Rs 141 crore.
However, if one excludes the tax credit component, net profit would have risen by just 8.50% y-o-y to Rs 367 crore.
During the quarter, the net interest income or the difference between interest earned and paid out, grew nearly 6% to Rs 1,400 crore.
KTK Bank –
Mangalore-based private sector lender Karnataka Bank''s third quarter (October-December, 2012-13) net profit moderated to 11% year-on-year to Rs 80 crore on the back of increased tax expenses. However, the profit before tax gained 77% y-o-y to Rs 117 crore.
During the quarter, the bank incurred a tax expenditure of Rs 37 crore as against a tax refund of Rs 637 a year back. This eroded the profit margin for the quarter. In July-September quarter, KB reported a 186% y-o-y jump in its net level.
Reliance Communications –
Reliance Communications '' consolidated net profit rose marginally to Rs 105 crore in the third quarter of financial year 2012-13 from Rs 102 crore in previous quarter.
Consolidated income from operations grew just by 2 percent quarter-on-quarter to Rs 5,136 crore in October-December quarter.
HUL –
Hindustan Unilever shares extended losses and tumbled 5 percent in morning trade on Wednesday after several brokerages cut their rating on the stock following disappointing third quarter earnings and a new pact with its Anglo-Dutch parent Unilever Plc, which will see its royalty payments more than double over next few years.
HUL on Tuesday reported a lower-than-expected 16 percent year-on-year rise in third quarter net profit at Rs 871 crore.
Net sales of the largest FMCG company in India rose 12 percent year-on-year to Rs 6,655 crore in Oct-Dec.
Due to Royalty effective from Feb 1, will affect close to 4.5 percent from the EPS projections. As per experts’ projections it was growing by 14.5 percent so if we exclude 4.5 percent it will grow about 10-10.5 percent which is significant becaHUL is one of the lowest earnings growth company in the sector. So definitely that is the negative sentiment which is hitting the stock right now.
MG’s view – stock may see further pressure and may fall significantly as investors are now switching to some good earners like ITC.
Telecom –
Bharti Airtel , India''s top mobile phone carrier, said it has raised voice call prices to account for rising costs, sending shares of telecommunication companies higher as investors bet that rivals will follow the market leader.
Idea Cellular , India''s No.3 carrier by revenue and No.4 by customers, also said on Wednesday it had effectively raised voice call prices in some parts of the country after withdrawing promotional offers. It gave no details.
MG’s View – Some top and good Telecom cos to move higher and after 2-3 good move will see some pressure of profit booking.
M&M –
Mahindra & Mahindra and BAE Systems are reviewing their joint venture, Defence Land Systems India given "significant evolution" that has happened in the Indian market, the utility vehicle maker to software services provider said on Wednesday.
M&M holds 74 percent and BAE has 26 percent stake in the joint venture established in 2009 to manufacture armoured vehicles and mine protected vehicles among other land defence systems.
Hero Moto Corp –
The management of two-wheeler major Hero MotoCorp and its Gurgaon plant workers will meet again for fresh rounds of talks from Friday in the presence of Haryana Deputy Labour Commissioner to break a five-month long deadlock over wage settlement.
The initial wage negotiations, which started during late-August 2012, remained inconclusive and fell apart on January 21. The matter was referred to the Deputy Labour Commissioner (DLC) of the region for further deliberations.
FDI in Retail –
Stocks of retail companies such as Pantaloon, Shopper''s Stop and Trent were up after reports stated that Foreign Investment Promotion Board (FIPB) has cleared IKEA''s Rs 100bn investment proposal.
Gold Retail –
Gems and jewellery firms such as Titan Industries, PC Jeweller, Gitanjali Gems and Shree Ganesh Jewellery Hoslipped 1-2%, after the government raised the import tax on gold by 2 percentage points to 6%.
==================== OPEN CALLS ====================
# Please remember when I make special remark with any position then one should need to take care of that else you can make loss instead of profit.
# Be with strict SL and don’t hesitate to book even small profit if Nifty doesn’t shows strength.
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2693. kisor Jha Jan 24, 2013 8:30:40 AM IST |
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kisor Jha's - Stock Comments, IPO Comments, Public Profile
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how to buy Nifty Call-Put Option and calculate profit or loss
Everyday we listen about Nifty Option price closing up or down,Call Option,Put Option, market bullish or bearish .We wonder how to trade in Nifty Option and earn profit with limited loss and unlimited profit. What are the points we have to keep in mind while trading Nifty Option, how to calculate the profit and loss.
First of all we have to determine the direction of the market whether market will be up or down.We can take the position in Nifty Option in the expected direction bullish or bearish.If we are bullish then we can buy Nifty Call Option and if bearish then we can buy Nifty Put Option.What trade we can and what would be our position in terms of profit and loss are explained below with examples.
If current price of Nifty is 2900 and Nifty Call Option Strike Price 3000 and Put Option Strike Price 2800 in January is 100=00 INRs and last date of expiry is on nth January. What trades we can do in Call and Put Option of Nifty and what will be our profit and loss position is as stated below.
If bullish we can Buy Nifty Call Option
(1)Buy Nifty Call Option January Strike Price 3000@100 INRs. Lot Size 50
Premium Paid=100*50=5000 INRs.
Maximum Loss=5000=00 INRs.
Maximum Profit=Unlimited
Break-even Price=3100
We can sell Nifty Call Option which we have bought anytime till last day of expiry i.e., nth January and can book profit or loss. If we do not sell Nifty Call Option we have bought till lasts day also then our trade will be automatically squared off at the settlement price of Nifty on last day of expiry decided by the exchange.
Different Possibilities with our Nifty Call Option Buy position
(1) Nifty Call Option price 140 and sold before expiry then
140-100=40*50=2000.00 INRs. Profit
(2)Nifty Call Option price 60 and sold before expiry then
100-60=40*50=2000 INRs. Loss
(3)Nifty settlement price 3200 and we have not sold Nifty Call Option till expiry then
3200-3000=200*50=10,000-5000=5000=00 INRs. Profit
(4)Nifty settlement price equals to or below 3000 and we have not sold Nifty Call Option till expiry then
5000=00 INRs Loss
This is the maximum loss we can have even if Nifty falls to any level beyond 3000.
(5)Nifty settlement price 3100 and we have not sold Nifty Call Option till expiry then
3100-3000=100*50=5000-5000=0.0 INRs. No Profit No Loss
If bearish we can Buy Nifty Put Option
(1) Buy Nifty Put Option Strike Price 2800.@100 INRs. Lot Size=50
Premium Paid=100*50=5000.00 INRs.
Maximum Loss=5000.00 INRs.
Maximum Profit=Unlimited
Break-even Price=2700
We can sell Nifty Put Option bought anytime till last day of expiry i.e., nth January and can book profit or loss.If we do not sell Nifty Put Option we have bought till lasts day also then our trade will be automatically squared off at the settlement price of Nifty on last day of expiry decided by the exchange.
Different Possibilities with our Nifty Put Option Buy position
(1) Nifty Put Option price 140 and sold before expiry then
140-100=40*50=2000.00 INRs. Profit
(2)Nifty Put Option price 60 and sold before expiry then
100-60=40*50=2000 INRs. Loss
(3)Nifty settlement price 2600 and we have not sold Nifty Put Option till expiry then
2800-2600=200*50=10,000-5000=5000=00 INRs. Profit
(4)Nifty settlement price equals to or above 2800 and we have not sold Nifty Put Option till expiry then
5000=00 INRs Loss
This is the maximum loss we can have even if Nifty rises to any level beyond 2800.
(5)Nifty settlement price 2700 and we have not sold Nifty Put Option till expiry then
2800-2700=100*50=5000-5000=0.0 INRs. No Profit No Loss.
What is the advantage of buying Option compared to Future.Maximum loss is fixed and predefined.We cannot lose more then the premium paid to buy the Option under any circumstances and it is known to us before we trade.We can square up the Option position anytime after buying just like Future.We have to pay only amount of premium and not the margin which is required for buying future.
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