Equity Markets

[post2ashish]

hey guys...hold on... instead of discussing all this phrase-o-logy, terms & talkin abt the best picks , v shud rather post more on building up our fundamentals...
PEG was a new learning for me too..... txs guys !!!

regd me:
i too am into the markets for some time ..... made a lot of money (started with a cap of 5000) in day trading.....then lost a lot... in all it had been a break even...
In the end my learning says tht if u r a beginner, do paper-deals for atleast a month & then go ahead... regularly read msgboard on moneycontrol.com & try to analyse them...

Also let us build our fundamentals first & then we can start guiding each other...

bye for now !!!

[muks]

hey,
anyone interested in textile stocks? the sector is going to open in 2005 and all quotas will vanish then.india presently has a small share in world market and it is sure to benifit. so, how r arvind,raymonds and all textile companies?? i think quite cheap as their order book is sure to increase.
mux

[Archana]

hello Guys!

Its nice to read this interesting thread! I was reading thru the discussions and it gives me an impression that all gyaan givers here are techies ! But the argement of MF/ single investor was a nice one!
Thanks Snan and Photon for ur gyaan

kanti: U bought HLL at 190 right? and u booked a good profit when u sold it at 205! so why r u worried ? and u dont have to worry abt the co. Even at 150, i am convinced that HLL is def a good pick (as snan said) over say 6-10 months.
I am FMCG analyst. Atleast fundamentally, the HLL lost its 'hot pick image' becoz
1. its Q-results on 31st dec were not encouraging! (immediately the investors begin to believe that the management did badly...blabla...and the scrip dropped.
2. The recent cut in its selling price. WIth the good rains this time, and the rural demand picking up, This move was deliberately done to increase the volume. I think its a good move in the current market.
very soon HLL is going to get back to the Value Buy slot! Its one scrip that u can retain for the good mgmnt and sound mktg and business strategy and ofcrs the rich dividends that r being declared!

Just wait for a lil time and m sure HLL wud do well again

[snan]

Originally Posted by photon

[. What happens on the company's books; snan might be able to answer.

On the books for bonus i ve already explained..
for stock split...

NOTHING HAPPENS !!!

Eg: -

Co. :- XYZ..

Resrves :- 20000
Paid up :- 20000

Once stock is split...
Reserves :- 20000
Paid Up : -20000

Stock split jus increases liquidity so tht more retail participation can be encouraged....
Why junta is gung ho bout bonus is tht the future wouold be arguably better (otherwise why wud the company reduce their reserves?).............

For stock split number of shares increases....so like in bonus issue, EPS decreases...theoretically it should decrease such tht total market cap remains constant...thts whr ur previous formula comes into picutre...

Market cap before split = say x*y
Market cap after split = 10x * y/10 ( say split in the ratio of 1:10).........

Real case: - Centurion bank...dunno the details ..but it was a stock split if i rem correctly...u can search around for the full study

Disclaimer :- I AM NOT CA...neither have i got formal Fin / Commerce studies /degrees...im jus ANOTHER engineer.....so dont sue me in case of mistakes !! )

[nickspeedster]

I agree with the paper deals concept...
I call them dummy transactions...

Go to icicidirect and register yourself...
start building a portfolio as if real money was involved...
After soem time, if you think you have done well(aka made some money ) get into the market with a small amount(5000 would be good for starters) and then get on with the game!!!

[Archana]

Guys,

The best site to learn basics on FM and especially the Equity and Debt related fundaes is from www.investopedia.com. They have brilliant tutorials for every topic that u can think of in the financial sector. And also, they give good notes and practice for the US-CFA prog and the fav site of all analysts

[ace_bubble]

hey guys...hold on... instead of discussing all this phrase-o-logy, terms & talkin abt the best picks , v shud rather post more on building up our fundamentals...

I have been studying market superficially for past 1 year
But its been three months since I have been watchin market rather closely and want to dive into it full time.
I had started with technical analysis and then moved into fundamental analysis.
Now I feel I have enough background to buy after all one would never learn unless he tries to do stuff.

Ill suggest devote some time in understanding balance sheets, income statement and cash flows and how the market moves

Would be buying my first scrip’s from next week.

hey,
anyone interested in textile stocks? the sector is going to open in 2005 and all quotas will vanish then.india presently has a small share in world market and it is sure to benifit. so, how r arvind,raymonds and all textile companies?? i think quite cheap as their order book is sure to increase.
mux

u r right but the EU and America are still oppsing quotas they say china would be a big threat to even developing countries like india

So just wait nothing is finalized and here all the mills in bombay are closing there factories and selling the land to real estate ppl

I have not yet analyised the books of textile sector
would post about them later

cheers


ps. Muks internet is well equiped , need to define ur search (what exactly u want , I may help u in locating the answer)

[Archana]

Regarding Bonus Declaration:

As Snan mentioned,
If
Share Capital 10000
Reserves 30000 (total funds belonging to Shareholders)= 40000
and then the bonus is 1:1, then

Share Capital 20000
Reserves 20000 (total still remains 40000)

However, it is imp because, it has the following implications for both the SH and the Co.:

1. An investor gets an extra share of the co at NO COST :P So if Infy is 6000, then u get another share of infy thats probably can b sold at 6000 too. it means a possibility of capital gains for the invesotr holding the scrip.

2. Probably the co. is trying to raise some high debt since its pooling in a lot into its equity funds from its reserves so that its financial ratios (DE ratio) and other ratios r nto a matter of concern when the debt fund is raised.

3. If the co. is following a 'Fixed Dividend Rate policy' say....10%, then on every share, it may have to declare the same 10%. So if the Co initially paid 10% of 10000 = 1000 as dividend, now it wud have to pay 10% of 20000 = 2000 as its dividend, whcih means CASH requiremtn is gona shoot up!

[Archana]

As Snan Mentioned,
Stock Splits are only to ensure more trading and more retail investor participation in the scrip.
If infy is at 6000 and i am an investor with 10000 to invest, and i am confident of infy to do welll and another sector stock say FMCG- ITC to do well, i can buy only 1 share of infy and then few shares of ITC.(putting ur eggs in diff baskets - diversifying my portfolio by investing in diff sector stocks to avoid sector specific risks)

However, with a stock split of Infy in 1:10 ratio, i cud probably buy more shares of Infy, a few of ITC and then invest the remainign money in another stock ( assuming that i invest in 5-6 shares of Infy after split). ---> Better participation (with little money i get a achance to invest in diff sectors, stocks diff cap stocks too...blabla)

Also the EPS of the stock drops due to the no. of outstanding shares increasing.

Before split,
PAT (Profit after tax) = 10,000
O/s Shares = 100
EPS = PAT/ Os Shares = 100

Now after Split,
PAT = 10,000
o/s Shares = 1000
EPS = 10

other than the participation factor and the EPS (declining in absolute terms) there is no big implication of a stock split

[post2ashish]

hey, anyone interested in textile stocks?

Would be buying my first scrip’s from next week.

regd invetsment.....
the market is at ~5900... may move up another 80 pts till elections...but thts it...... a big correction (i.e. reversal of trend) is expected in the days to come & SENSEX may slide by 500 pts in the coming 2-3 weeks... so my advice wud be don't invest any money right now... wait till correction happens...
regd textile my scrips are : Bhartiya international (a leather apparel company with pending walmart orders); Welspun India+Guj, mahavir spinning.....
there r a lot of sectors to invest (Banking & Oil) but again my advice is don't invest right now... though tempting it may b...

regd online trading:
don't start it with ICICI (personal advice) i'm already subscribed with them...here's a sneak into the service they provide
1. There servers are down at 9:55 in the moring at least once a week (esp when some key issue is getting listed).
2. The daily analysis (day trading n derivatives) comes after 11:00 AM when the stocks have already moved (in day trading if u have not made ur sell/buypostions with in first 10-15 mins .... forget it)
3. They charge the highest fees amongst trading sites.
4. The good points are u'll have a bank account which has the biggest network of ATM's amongst its peers & ur money with them is secure. These people won't run away even if they r into trouble (like the one they had last april when there was a rumour regd cash problem with icici)

But believe me u feel F****up when u cann't trade in the morning just bcose the A**H*** servers don't turn up.

HDFC, Sherkhan(they r still strugling with MCS), 5 paisa r more or less the same
..... go for kotaksecurities.com
Again all the above analysis is my personal opinion & i don't take any responsibility for any losses (real or virtual) u might accrue .....


Archana: gud analysis..... go n join SPJ-D ...u sure will rock after the course... (i hope ur finally opting for the course) i too feel the same regd infy ... its all hyped... no use buying the scrip right now...

ashish