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'I am bullish on the market'Mumbai, February 24, 2004: 'Look at all the PSUs going public. There are good chances of 20% plus returns in 3 months or so,' says Ramesh Shrichand Damani.anaam : Sir,Investing is an art & not a science.If it was science all the chartered would have been millioners. And above all it needs conviction & patience.For all of us you are "Piccaso"....Thanks a lot for sparing your valuable time for us. Ramesh S Damani : Hello everyone. Thanks for joining. Let's start. Thanks for such kind words. It really has given me a lift. JEDHM : I will appreciate your valuable advice on PETRONET LNG, POWER TRADING CORP. & BIOCON IPOs. Ramesh S Damani : Take a look at Power Trading and Biocon. I think IPCL could be a dark horse. The others including CMC look good to me. Mathew : Hi Ramesh, to continue the discussion on telecom do you think there will be a profitability squeeze on gsm players in the future and in view of that does bharti deserve the valuation it is enjoying now? We need to consider the huge capex outlays by cdma players (tatas talking of usd 2 bln, reliance and bsnl too). So there will be intense competition for addnl subscribers, which will drive down the rates and squeeze the margins further. Your views Ramesh S Damani : Look at subscriber density. That will grow from 3 per 100 to maybe double that. Bharti is making money at current level. Marginal subscibers will add to the bottom line. It will be a oligopoly with 2-3 players making all the money. HiDamani : YOU HAVE MENTIONED TISCO IN UR NEW YEARS ARTICLE ON MONEYCONTROL.COM THAT IT IS A VERY GOOD BUY AT 420 .DO U FEEL TISCO HAS THE POTENTIAL TO DOUBLE FROM THESE VALUATIONS IN 2 YEARS TIME.I AM NOT SETTING LIMITS HERE , JUST WANT TO KNOW ITS POTENTIAL. THANKS IN ADVANCE Ramesh S Damani : I think it is very likely to move higher. AnandBhatt : Hello Sir,what should we do in these falling markets?Buy the tech masket of your midcaps like Logix,ale etc or wait?Please advise Ramesh S Damani : Look at PSUs going public. There are good chances of 20% plus returns in 3 months or so. I am bullish on the market. I believe it should test the high end of its range next month. SURESHMAKHIJA : SIR JI GOOD EVENING APART FROM ONE UP ON WALL STREET WHISH IS GOOD BOOK ON VALUE INESVTING PL ADVICE Ramesh S Damani : Read 'An American Capitalist Reminiscences' Mathew : Have you seen the forward crop estimates of the agricultural ministry (as reported in business line). In volume terms food grain production is expected to go up by 23%, oil seeds by some 40% and cotton by almost 67%. And the prices of all these have gone up compared to last yr. Is this for real or is this too much of a 'feel good'. Ramesh S Damani : I have not seen the numbers. They look good and would be a boom for FMCG. vikas : What is the significance of market cap to sales ratio? what is idea ration. could you explain with Mcdowell reference assuming its sales is 1000 cr. and market cap 200 cr. Ramesh S Damani : It tells us how the market is valuing the company for every one rupee sales it is being valued at 20 paisa. You should look at the debt component also. Growth company will have a high price/sales ratio. SURESHMAKHIJA : SIR BIOCON IS INDIAS BIGGEST BIOTECHNOLOGY COMPANY WHAT ARE YOUR VIEWS ON IPO OF BIOCON INDIA Ramesh S Damani : I would enter the IPO. It will be a premium issue and command a good PE. baracuda : radico khaitan is the better managed liquor co but yu hardly talk about it i feel in 2-3 yrs it will give mallya a run for his money Ramesh S Damani : It may well. Management is much better than McDowell, but McDowell controls 40 per cent of the liquor market. We have to remember this fact. anaamika : Sir,Some time back I referred to a quote...Finding a multibagger is just like discovering "Madhuri Dixit" in her teens.Have you yet discovered next Madhuri..No doubt your last "madhuri" was BEL.Are you still "holding" her???????? Ramesh S Damani : Yes. I like to believe that all stocks I pick will be "Madhuris". Clearly that doesn't happen but that is always the hope while looking. AnandBhatt : Sir,since the market touches 6200 on 2nd or 3rd Jan all analysts said that anycorrection should be a buying opportunity.Everyone kepy shouting from the rooftops that there is so much money on the sidelines just waiting to get in.Its the end of Feb.Where is all this liquidity/money now at lower levels when the market is falling? Ramesh S Damani : Be focused on what you want to do. There will always be contrary views. With the economy growing at 8% and interest rates low, money will come in. FIIs are still buying. Up and down are a regular features of markets. Nothing has changed. vikas : I agree with your theme CONVICTION but if u also see market reacting to IPO's and Election then why dont you sell and buy later on with less price. I mean u could have sold at 6100-6200 and recover now especially mid caps Ramesh S Damani : It is a very poor strategy, things may not work out as we say. Transaction costs are high. Have convictions and your calls will be rewarded. balladsandblues : Now that the price levels are known which among the following are attarctive ipos IPCL,Bank Of maha,CMC,ONGC? Ramesh S Damani : The first 3 look okay to me. baracuda : the equity of boicon is around 100crs and kmshaw says she will post anet of 120crs hence an eps of 12 at 600rs 10 paid up doesnt this price look expensivewe have divis and matrix available at a much lower discounting Ramesh S Damani : It is, let's study it further. subodhgk : Mr. Damani, I have bought Khoday, Jagatjit and Shaw Wallace and made decent profit. And again reentered. I am also bullish on small liquor co like GM breweries. There are not many who know them. What do you think about all these picks ? Ramesh S Damani : Liquor is a long-term story. I would not recommend them for trading. AnandBhatt : Would you pick Gail,Petronet LNG,Power Trading and Biocon and leave the rest like.One cannot invest in all of them as all of them are one after the other so you need to investall the money at one time Ramesh S Damani : If I had to pick 2 I would look at Power trading and Biocon. VIKAS 5 : URGENT : SIR : Next Tuesday , i understand is HOLIDAY . As u know it is critical time of marketand we need your continuous guidance therefore on behalf of everybody on this chat , Can i request you to spare some time either on monday or wednesday with us Ramesh S Damani : Thanks, I will look into it and have the timing posted. parthiv : Mcdoweell has good support at Rs. 54 whats you take on it now, you dont seem to be very enthusiatic about it. Ramesh S Damani : I am just weary discussing it on every show. Let's talk about new stocks. Siva : Can't it be possible that with the rate of sliding of indices that we may get the current PSU IPOs at prices less than floor prices fixed by the Govt? Ramesh S Damani : It could happen but I would subscribe. vikas : Sundaram Finance : I saw the balance sheet. Its really good with reserve almost 19 times of equity. Do u think it is heading for big times. A double canditate minimum Ramesh S Damani : Look at its subsidiary company.The script should head much higher than double. I own it. Mathew : Last week, a singapore minister on visit to india said Singapore can be to India what HK is to China. Considering the fact that Temasek Holdings is one of the most active foreign investor in India, do you see a calculated move by Singapore here. If so, which are the sectors which can benefit? Ramesh S Damani : Infrastructure, tech, drug, telecom would benefit. suparna : pls let me have your view on FDC?..... Ramesh S Damani : They are doing well. It looks okay to me. sudipto : Sir i am a samll investor. I want to apply in biocon ipo. But at present i am short in liquid cash. So i am planning to sell some ammount (50) of monsanto to apply for biocon. Sir will it be a good idea? i am confused please help me ? Ramesh S Damani : I would not sell Monsanto. I own it. AnandBhatt : I know the fancy would be in the IPOs but I was thinking its a good opportunity to buy GodrejInd[it touched 50 today] ,Goldiam and the tech basket of KAle,Logix,Nelco and Crest which is also in its low 40s.All of them have been hammered down.After all it does not matter in whether we make the 20% in IPOs or the other value picks or would you go for market fancy and subscribe to the IPOs instead.One has limited money to invest after all.Thanks. Ramesh S Damani : No doubt about it. But people want IPO ideas. They have made a lot of money on Maruti. VIKAS 5 : TECH STOCKS : Do u think they are unnecessarily taking beating and this is very good opportunity to enter these stocks especially mid caps like I FLEX , E SERVE , INFOTECH AND VISUAL Ramesh S Damani : I would buy some tech. Only worried about rupee appreciating not backlash which is a stupid issue. Siva : Sir, you were strongly recommending balaji recently. According to you, what are the price levels that it could reach say within a span of a timeframe of about 3 years ? Ramesh S Damani : I still am. It should command a premium multiple not 4 times PBT. arvind : ramesh why u so against ongc, its a great co. much lower in valuation than its global peers Ramesh S Damani : It doesn't deserve to be India' s largest market cap company. It is a government run monopoly. They don't do anything particularly well. They make money but not because of being competent but out of good fortune. Not bad but not the best way. VIKAS 5 : I ASKED whats so special in Kale , Logix , Crest , Nelco , Godrej previous results which are making to enthu about future Ramesh S Damani : M-cap is small, prospects are good. I like that kind of investment. lavanya : a few people say that cmc is overvalued. what is the possibility of a merger with tcs in future? Ramesh S Damani : Good chances in 1-2 years. HiDamani : R U STILL BULLISH ABT NELCO? i DIDN'T SEE U RECOMMENDING IT IN LAST FEW CHATS OR HAVE U CHANGED UR VIEW SOMEHOW? Ramesh S Damani : No. SURESHMAKHIJA : SIR WHAT R U R VIEWS ON HARDWARE COMPANY DO U HAVE ANY PICKS IN HARDWARE SECTION PLZ ADVICE Ramesh S Damani : D-Link and TVS Electronics. Siva : Any other invaluable books on financial markets that you recommend. By the way what is your opinion on taking calls purely ontechnical analysis? Sir, do you follow TA ? Ramesh S Damani : Lots of good books. One of these days I will post a list of 12 books that every one should read from Jr to Sr level. I occasionally look at charts. chandani : sir TVS electronics???? it has tanked after restructuring so pl. explain,.. Ramesh S Damani : It is still struggling but at these values I would take a bet. SURESHMAKHIJA : SIR DO U RECEVIE MY NEW YEAR CARD PLZ ANSWER Ramesh S Damani : I am sorry, I don't recall seeing it. Refresh my memory. sk : I have some qty of OEN connectors and Krone. While OEN is doing well, Krone is down - is it because they gave support to Reliance Infocomm which are not known for paying up contrtactors ? Ramesh S Damani : OEN Connectors is basically an outsourcing story, Krone is focussing on the local market. Siva : where do you post those 12 books (i mean on which site) and how do we come to know ? Ramesh S Damani : On one of the chat shows. They can then be read in the transcripts. vikas : JUST REMINDING U if u can spare some time next week on monday or wednesday if Tuesday is a holiday Ramesh S Damani : If not on Tuesday, I will do it on Wednesday. arvind : ongc business no longer monopoly. its bidding for blaocks alongwith private. it bagged 14 blocks recfently while reliance only one. thats by bidding not govt. status Ramesh S Damani : I think you get my drift. It is not a private company. It is a government granted monopoly. I am not too comfortable with that. They are doing well, no doubt about that. newbieatstock : sir how did u learn technical analysis Ramesh S Damani : Read up. baracuda : do yu see a gradual shifht of the average indian investors money from the fds in banks and from income funds to the stock market either primary ipos or through mutual funds or will this never happen in india are we genetically risk averse? Ramesh S Damani : It should happen, yes. Mathew : agreed that ongc has been extremely fortunate. But considering its huge cash horde and networth of over 35000 crores, it can be a fair bet in an energy starved nation growing exponentially. Ramesh S Damani : It could if the monopoly continues. SURESHMAKHIJA : IN THAT CARD I HAD WITEEN MY NAME SURESH MAKHIJA AND ALSO I HAD WRITEEN THEIR MY EMAIL ID SURESHMAKHIJA2K@REDIFFMAIL.COM DO U REMBER NOW Ramesh S Damani : Sorry. vikas : INFOTECH ENTERPRISES : With Bombardier deal which will give topline of 20 cr. next year and 60 cr. following year + Puerto Rico facility + VARGIS acquisition in GIS would result in better visibility and case for SOLID INVESTMENT Ramesh S Damani : Other than management that constantly promises more than it delivers. AnandBBhatt : I did not understand the answer about Nelco that HIDamaniasked?Its part of your tech basket,right? Ramesh S Damani : Yes newbieatstock : sir i had asked u about investing in some large caps, can u please mention 3 of them with a timeframe ? Ramesh S Damani : SBI and Tisco for 2 years. AnandBBhatt : Sir,will this rupee appreciation problem continue?When will this trend change which is a big hurdle for the tech sector? Ramesh S Damani : It is not going to get over easily. SURESHMAKHIJA : DAMANI JI WHY DONT U STRAT YOUR OWN WEBSITE ON INVESTING ALREADY U HAVE LARGE NO OF FOLLOWERS AND I THINK U R THE MOST POPULAR PERSON IN INESTING WORLD OF INDIA Ramesh S Damani : Thanks, that is flattering. Mathew : could you check the development at shree raj syn, last week's ad Ramesh S Damani : yes, they are probably going infor a major expansion into textiles for 2005. newbieatstock : sir if u like a particluar script that is traded on the f and o secgment do u buy the futures or the cash instead ? Ramesh S Damani : First in cash. chandani : sir how is GILLETTE it has given me cramps as i entered it atb700 and now it is near to 600... Ramesh S Damani : It remains a great bet. vikas : IGATE : Mr. Murthy taking very big. Would u like to bet on him. Seriously is it good opportunity? Ramesh S Damani : I am looking at i-Gate. Not invested yet. SURESHMAKHIJA : SIR WHY DO U FEELTHATS FLATEEING I REALLY MEAN IT I HAVE A LOT OF RESPECT FOR U BCZ U HAVE HELPED THE PEPOLE A LOT THAT IS THE REASON I RESPECT U A LOT Ramesh S Damani : Thanks again. I am very happy if I can help people invest wisely. newbieatstock : sir is balaji a more conservative bet or u think it can be a multibagger over the years, a lot of people say the content they have is limited and teh company can do only so much. Ramesh S Damani : Any girl that pays 30 crs plus tax each year should be taken seriously. susmita08 : sir according to ur advice i`ve added 1000 goldiam, 800 godrej. plz suggest some more small caps which i can add . Ramesh S Damani : Opto Circuits around (56) and Man Industries (110) is having a good year. chandani : SHE is paying 30 crores as tax because her tax consultant is not smart enough else she can spend more inbest concept and more to artists and can get more revenue.. more Ramesh S Damani : We all have our views. I admire some one with a film background who runs such a clean ship. It shows confidence in your business model. Thanks all. See you next week maybe on Wed if Tue is a holiday. Bye. |