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'Market to remain lacklustre till May 10'Mumbai, April 27, 2004: 'I believe that we are in a bull market and prices will head higher. I would like to remain invested,' says Ramesh Shrichand Damani.SirUB group spirits division scaling new highs. They beame the 4th largest spirit maker in the world. Now they are looking to export 5lakh cases RUMS to U.K & U.S. so much news is happening the company. But the share price is not moving anywhere.Why the mcdowell scrip not attracting speculators or funds and institutions even at these newses????? I think our fund managers willnot buy at now. they wouldnot buy before the turnaround happen. They will buy only after turnaround. At the time the stock will be in 3digit. They never recommend it at 55 ,the same will recommend it at 200. Ramesh S Damani : Hello everybody thanks for joining. Let's start. Unfortunately the earnings record is still poor, hence they get no discounting. How such companies cannot earn even Rs 10 per share is beyond me. That is why we need to allow hostile takeovers. DamanisFan : What a great fall ! Ramesh S Damani : Yes, the market is likely to remain lackluster till May 10. baracuda : bharti tele has delivered the goods if it reacts further would you buy the stock now. Ramesh S Damani : I did buy a small quantity earlier. Analysts following the company expect it to do well in the next few quarters. Management concerns are now behind us. RajanNanda : sir, do you advise any bottomfishing or something which you like to keep an eye upon when price falls Ramesh S Damani : Yes. NAVEEN : Dear Sir,I want to invest in textile sector. Do you think it is right decesion Ramesh S Damani : Post 2005 a big opportunity is opening up for them so certainly take a look at it. ValueInvestor : Is this fall in markets today an over reaction ? Ramesh S Damani : My sense is we should be cautious in PSU stocks. Otherwise I would buy into this dip. ValueInvestor : what do u mean by Hostile Takeover Ramesh S Damani : 3rd party makes a bid to take over the company and change the management. susmita : goodevening sir , I`m a very small investor . can u suggest some good smallcaps which will give good return in few months time. Ramesh S Damani : I had recommended 3 value plays previously -- Goldiam, Opto Circuits and Godrej Ind. All are good value and pay a good dividend. I own all of them. RajanNanda : Sir, market like stabilty but now it is sttled then all three political faction NDA, Cong+ and Third front ( chidambram dream budget they gave) are for reforms.then why worry ? Ramesh S Damani : Congress is not for divestment, though it may change. baracuda : the rupee has also reacted downwards that may be an more ominious sign of things to come if we do not get a stable coalition govt at the centre,who will manage the fiscal deficit and the reform process Ramesh S Damani : Yes, though the rupee is in a secular uptrend. ValueInvestor : Why are not the FMCG scrips like Colgate ,HLL etc not moving up? Can we see funds diverted from PSU stocks after this fall to these FMCG stocks Ramesh S Damani : That is hard to say, FMCG stocks are not delivering growth. probal : sir if nda government does't come to power, and then congress + third front comes to power we gess the marker will tank below 5000 as told by analyst. Then what should we do seel off and wait in the sideline of will it be a premature end of the bull market. pl guide us. Ramesh S Damani : In my opinion bull markets will not be stopped even by a change in the govt. Some decisions are mechanical and will not be opposed by any at the Centre. They have no choice. The only sector to be careful about are PSU stocks over the next 3 months. shaista : i think these exit polls are only prediction and not final result so why the market have taken them seriously and any prediction can go wrong what is your view. Ramesh S Damani : Clearly you can't change your portfolio based on them. RajanNanda : sir, do you ever feel that you have stretched your conviction too much in case of Mcdowell/UB ? Ramesh S Damani : Yes. But you can't argue with the facts. I am paying a price in terms of time. baracuda : yu say to be cautius in psu stocks so do yu recomend a sell on bel, nivyelli,beml and hpcl in their own right these are good dividend paying cos who are any way not on the disinvestment list,bel appears to be slowing down 4qrt results are a matter of concern Ramesh S Damani : Analysts have suggested that sales have been shifted from Q4 to Q1. However it bears watching. I still own it. ValueInvestor : What is ur opinion on GAIL as a long term investment i.e in the next 5 years ? Ramesh S Damani : It should be a steady compounder. probal : within the psu basket hpcl,bpcl,sbi,ioc,ongc falls. we know that u might have a position in sbi,hpcl bpcl etc. did u sell off or planning to do so in near future. please guide us.thanks Ramesh S Damani : I don't like to discuss what I would do personally. It is irrelevant. I am fairly open with the stocks I recommend. balaji : can we enter into upcoming ipo's after looking at the dishmans rise. or better to wait till the new govt. forms Ramesh S Damani : Nothing particularly exciting coming up. ahmedabadguy : Mr. Damani Gati has finally shown some increase in topline..With Incresed growth in indian industry do you see script has any chance of shining out in near to medium future?? Ramesh S Damani : Trucks are at a premium so the company is going to have a good year. malik : sir , u have purchased KSB PUMPS. Please tell me what make u to buy this scrip. Ramesh S Damani : It is a cheap stock and out of favour. If GDP growth continues they will do well. vikas2 : What will be your strategy in case NDA doesn't come back Ramesh S Damani : I intend to remain invested, may trim some PSU stocks. vikas2 : Sundaram Finance is coming down . Good value pick for one year Ramesh S Damani : Yes. probal : I am sorry , for my language. but will u please advise us about out holdings in sbi,hpcl,bpcl,onge,ioc. we are bit confused and need your kind help. please sir Ramesh S Damani : I remain bullish on SBI and trading in ONGC. HPCL, BPCL will be volatile till fate of divestment is known. The first two are not to be divested. ajay : ramesh, sometime back u mentioned that u will give a list of 10 investment books every investor should read.can we have a few today???? Ramesh S Damani : Sorry for the delay. Here are 5 classics : Reminiscences of a stock market operator; One up on Wall Street; The making of an American capitalist; Market Wizards and Of Permanent Value : The Story of Warren Buffett. All are great books and should be read and re-read. Sorry again. kvg : sir, can we buy TV Today at these levels . please give your opinion Ramesh S Damani : I have not looked at it recently. sanujkadavil : SirUB group spirits division scaling new highs. They beame the 4th largest spirit maker in the world. Now they are looking to export 5lakh cases RUMS to U.K & U.S. so much news is happening the company. But the share price is not moving anywhere.Why the mcdowell scrip not attracting speculators or funds and institutions even at these newses????? I think our fund managers willnot buy at now. they wouldnot buy before the turnaround happen. They will buy only after turnaround. At the time the stock will be in 3digit. They never recommend it at 55 ,the same will recommend it at 200. Ramesh S Damani : When that happens we will drink to it? ahmedabadguy : Sir are you happy with Macmilan result?Was it inline with your expectetion?And what is your view about the script at current prise?? Ramesh S Damani : Publishing is a problem, ITES is doing well. Y-o-Y ITES business increased by 4.88 cr (58%) and profit increased by 4.32 cr. That is fabulous. The company is facing turnover attrition, but otherwise things are going well. kvg : Sir,Ultramarine pigment and dyes . This company's dyes are used in Textiles also??? Ramesh S Damani : Yes and the ITES business is doing well. malik : sir, whether ua re able to visit NELCO this week.if yesthen please tell the outcome of the same Ramesh S Damani : Sorry, have not got an appointment. eserveLoser : Sir, I was to sell of my eserve shares and buy equivalent ITES/BPO shares. What are your recommendations for a reasonable switch over ? Ramesh S Damani : I think the 2 other plays are old favourites of mine Tata Honeywell and MacMillan. I own them both. By the way what price would you like to tender e-serve at? vas : Sir today market crsahed nearly 213 points, can we expect further fall. Give me your views on KVB at current level Ramesh S Damani : It may be lacklustre, KVB looks good to me. I own it. baracuda : please advice on nyvelli lignitehold or sell,i feel it is a hold becos no voter is going to tolerate frequent power cuts and darkness and which ever govt comes power sector reforms will have to go through Ramesh S Damani : I would hold on. PSUs are being looked as stable business and not just divestment. So the good co will survive and even prosper. ValueInvestor : Why is Warren Buffett not interested in investing in India so far ? Ramesh S Damani : I would expect him to make an investment in the next few years. akss : sir, what should we do till 10th may with respect to PSU stocks Ramesh S Damani : "Sweat" it out BOMBAYBULL : WHICH STOCKS WOULD YOU LIKE TO BUY INTO DURING THIS DIP - APART FROM PSUS? CAN YOU PLS MENTIONE 2 OR 3 NAMES? Ramesh S Damani : I bought some Tata Elixsi today. sanujkadavl : sirlast year business today quoted that MOSCHIP will be the next infosys. becoz they are in highly technological and R & D field like chip design and embedded systems. and they have 16 product pipeline, once the products launched revenue shpuld come freely and make profits. but nothing happening in this company. promoters offloaded their major stake in the company. what is your call on moschip?? Ramesh S Damani : I have never been impressed by the company, Too large capital and lack of a track record. eserveLoser : Honestly I would like a tender price of 1500, but I might even settle for any 4 figure pricing Ramesh S Damani : Good point. KRR : Good afternoon Sir... i am glad to be here... normally i miss the chat sessions and used to rely to transcripts.... wanted to know your views in general after the exit poll results.... that i managed to get from the transcripts.... i am thankful to it as i have been making investment decisions based on your views and that has paid handsomely in last one year.... now, i request your views on Dr. Reddy.. i think its virtually risk free bet... your views, please : -) Ramesh S Damani : Thanks for joining in today. At these prices Dr Reddy seems tempting, but increasingly MNC companies are introducing generic products themselves. They will tend to do well but are facing growing pains. eserveLoser : Sir, thanks for your eserve views. You have never offered your opinions of the Datamatics IPO. I just wish to hear it once. Ramesh S Damani : McMillan seems to be a better bet to me. sanujkadavl : SirLast year everybody was talking about food processing. Today all of them forget about it. But I think the sector will emerge as fancy for investors. Because if we take retailing as potential sector, also packaged food producers should benefit. What is your call on AGRO TECH FOODS , 51% subsidiary of 24$billion conagra. At 24cr equity market cap only 140cr. Currently their netprofit margin of 1% at a sales of 1100cr. They are targeting $500million revenue in three years .if they can earn atlest 5% netmargin, e.p.s will be 40 rs. I think the market should treat this scrip as MNC fmcg giant like nestle and cadbry , itc. AND GET A P/E OF 15-20. Ramesh S Damani : Good thinking. If you are patient this could be a good bet over the next 5 years. vikas2 : TATA ELEXI : What made you buy this stock as this was never your kind of stock as far as we know you Ramesh S Damani : I am seeing good options from R&D outsourcing in tech companies. They are still not out of the woods, so i have made an initial bet and will watch them closely. sanujkadavl : SirNDTV issue is closing tomarow. Do you expecting a 100% return on listing. I think the mgmt is like INFOSYS. I think the market should give him a high P/E Ramesh S Damani : FIIs are not allowed to buy it. Hence it is not going to open with a huge premium. SIVA : Sir, any indian investment guru you admire ? Ramesh S Damani : Yes, but they don't like their names mentioned. jeer : If NDA does falls short of Majority, or even the talk about it would bring down the sensex down to 5000 levels!! Don't you think it is prudent to buy at this levels than now!! ( I know that you can't time the mkt but when you know that the mkt is down can;t we wait and pick up at lower levels?) Thanks for your views Ramesh S Damani : You have the answer. You can't time the market. Find good company, in good buisness growing at 30% and are cheap. Then don't worry about macro decisions. sugar : IN TECHNOLOGY, DID YOU GET A CHANCE TO LOOK AT IGATE? IF SO, HOWS THE FUTURE LOOKING WITH PHANEESH MURTHY AT THE TOP? TEMPLETON HAS RECENTLY BEGUN BUYING. Ramesh S Damani : Yes, I would keep an eye on it, Not bought it yet. sanujkadavl : sirwhat is ur immediate call on market.. sharp fall below 5000. or its a buying opportunity Ramesh S Damani : I doubt it goes to that level. ganesh : sir what is ur call on GSK PHARMA@640 CADILA@170 CIPLA@1140 and GLENMARK@90 hold or exit Ramesh S Damani : I don't follow Cadilla, though they have done well. The rest looks okay to me, I own them. KRR : one more question.... i have been buying based on your advice since the days when gail was 97 and balaji was 52 i.e. since the index was around 3200... and 90% of my portfolio is built with the scripts suggested by you.... now the basic question is... what do you suggest? or what would you do if you were in my place? would you hold on or book partial profits at this very point? ( if i wait for another 1-2 months, i would get advantage of tax free long term capital gain, but it might wipe off more gains than the quantum of taxes)... Ramesh S Damani : That you would have to decide, not withstanding today's fall. I believe that we are in a bull market and prices will head higher. I would like to remain invested -- fall, sharp falls and rises are part of market operations, the bullmarket remains intact. venkat : Mr Damani, Am on this chat for the first time and I admire your acumen. What is your opinion on buying Tata chemicals in respect of their stake in tcs Ramesh S Damani : Thanks. It should be factored into the price at least somewhat. ahmedabadguy : Mr. Damani Leading Ahmedabad based News paper baron has taken good chunk of Mcdowell delivary(He exited Voltas with good profit)..I think script has now got good attention as value buy so may be not much floating stock left...your views Ramesh S Damani : It has 50 cr equity with 50% float so floating stock is large. Iask : sir, can we have ur views on NDTV IPO???? Ramesh S Damani : Good but would not be as excited as Dishman. rajesh : Sir, dont you think that if there is no stable govt form at centre, then there is more down side than upside? would like to sell some shares. If so which shares you will sell? What % of equity you would advice to invest in ITES stocks. Ramesh S Damani : Bull markets climb a wall of worry, and don't pay much attention to change in government etc. It must run its course. sugar : ARE YOU EXPECTING GOOD RESULTS FROM MAN INDUSTRIES? PLEASE COMMENT. Ramesh S Damani : Yes, they will do well over the next two years. SIVA : What would be the impact of CMC w.r.t. TCS IPO? Ramesh S Damani : I think they could be merged at some time. sugar : WOULD TATA ELXSI THEN BE CLASSIFIED AS A BRO STORY DOING DESIGN WORK AND ANIMATION? MAINLY FOR OVERSEAS CLIENTS? Ramesh S Damani : Somewhat. Vinit : If you were to suggest 3 stcoks for buying (for long-term 3 yaers +), which would those be? Ramesh S Damani : I'll have to think about it. KRR : Sir... this is funny but interesting question... suppose due to some reason, trading in Mcdowell is stopped for say 1-2 years... and after six months from now, someone asks for your holding in Mcdowell... at what price would you offer..... basically i am asking at what price would you sale Mcdowell... Ramesh S Damani : Ambev, controlling 80% of Brazilian liquor market was recently sold for 11 billion euros. Bacardi may go public at a valuation of $10 billion. You figure out what a company in India with 40% market share, billion consumers, 50% below 20 should be worth. If Mr Mallya does not understand what he has and protect it -- he may regret it. ahmedabadguy : yes but that 50% value even at 60 rs. is not more then 150 crore and this news paper baron type investors can easily fork out 15-20 crores for single good investments...So may be few more of them needs to look at the counter and Mr. Malaya will wake up very fast... Ramesh S Damani : He may still be partying and not notice!!! Joy1234 : Rameshji what about South Indian Bank?Can I buy it to be another Federal Bank?How is the bank according to it's operation and balance sheet....I decide much on your comments.I feel with 6 month perspective it will give handsome returns .And EPS for the current year would be 29.Is it correct? regards. Ramesh S Damani : Pretty much, just hold on and let us see how valuation is unlocked. KRR : Sir... i hold tata infotech bought @ 272.... they are showing good turn aournd.. but considering TCS IPO what would you pic at current price? tata infotech or CMC? Ramesh S Damani : I own both. SIVA : Can't your liquor logic (to be consumed more by younger generation) be applied to cellular services ? If not, why pls ? Ramesh S Damani : Yes, but look at the market cap or how the market is valuing the company. AnandBhatt : Hello Sir,any idea if Tata Telecom has sent the forms to shareholders for tendering [Avaya was suppose to buy their stake at 240]?I own some shares. Ramesh S Damani : Sorry, don't know. ku : Damaniji,if you were to suggest 3 stcoks for buying (for long-term 3 yaers +), which would those be?Ramesh S Damani answers, ill have to think about it,Why are not requesting Mcdowell, Ubholding & Mcmillan Ramesh S Damani : UB holding won't be in the list. sugar : ANY IDEA ABOUT KALE'S PERFORMANCE THIS QUARTER ENDED MARCH 2004? CAN WE EXPECT GOOD DAYS AHEAD IN TRAVEL AND AIRLINES SOFTWARE? Ramesh S Damani : The company will have some write offs this quarter. From the next quarter they should be delivering stronger operating results Thanks all for joining see you next week. Bye rajesh : Sir, in large caps ITES stocks, pl recemmend one stock from Tata honey, Tata Infotek and CMC, Pl Answer Ramesh S Damani : If I had to pick one it would be Tata Honeywell, however all 3 are doing well. |