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HERE‘S A FLASH

CEAT Buy Rs 95.50

Sesa Goa Buy Rs 3160.95

Cairn India Buy Rs 222.40

TECHNICAL RECOMMENDATIONS

Monnet Ispat Buy Rs 462.05

Sterling Int Buy Rs 182.75

(Prices as on 19/03/2008 at 3.30 pm)

Street TalkMomentum call

High risk investors can take exposureto ANG Auto (BSE code530721) currently trading at Rs93.20. If market rumors are true,the scrip is expected to witnessa good amount of upwardmomentum.

Technically, the benchmark indices are still form a positive divergence pattern on the daily charts. A few of good days accompanied with good volumes would complete this pattern, which will give an impetus to a short-term rally. The Sensex has support at the 14,141 level. On the upside, the Sensex faces resistance at the 15,332 and 15,699 levels. The 4482 and 4074 are important support levels for the Nifty. On the upside, the Nifty faces resistance at the 4899 and 5025 levels.Investors should wait and watch.

The weekly trend is down and can turn up on rise above 16683 or if the Friday weekly close is above 16077. Weekly resistance will be at 15045-15414-15465. Weekly support will be at 14677-14626 and 14100-14000.On a further sustained fall and close below 14600, expect the Sensex to slide down to 14489 and 14102. The level of 14102 is the 0.382 level of the entire rise from 2594 to 21206.On the daily chart, we had two important trading lower tops created on the back of strong gap up opening of 500+ points. These trading lower tops are 15465 and 16683. If we have to get the first signs of a pull-back rally then first it must cross and close above 15465 and then move on to close above 16683. If the Sensex is able to meet the said conditions, then only the rise could be meaningful from the short-term perspective.

Strategy for the week

Traders holding short positions can look for fall down to 14700-14500 or to 14100-14000 for cover

TOWER TALK

* The marwari cartel that is pulling down the market is more active on trapping weak bulls and settling scores rather than a play of fundamentals.TOWER TALK

* SEBI’s examination of RPL transaction records may not lead to any results as the complete play was well insulated against insider trading or any similar provisions!

* Sell shares of broking outfits as they are overpriced even at current levels.

* Partial profit booking in gold is in order since the rate is likely to fall to 12500 per 10 gms.

* Pantaloon’s foray into rural retail outlets in the form of ‘Aadhaar’, a JV with Godrej, may take on the ‘Chaupals’ of ITC.* Did Tata Steel borrow Yens to finance the Corus deal? If it did, it will be in greater trouble.

* HDFC and LIC Housing may suffer due to the cool demand for housing finance but they are safer bets than commercial banks.

* SBI sinks below its rights offer price, Fed Bank sinks below its rights issue price. At this rate, who will subscribe to any rights or IPOs for that matter?

* Share price of construction companies can still go down further going by the slowdown in the commercial real estate sector.

* ICICI Bank has hit new lows on the US sub prime factor and provides a wonderful opportunity for long-term investors to start accumulating. Soon it will demerge its various businesses, which will lead to tremendous unlocking of value.

* Share price of Adlabs Films, belonging to the Anil Ambani group, has become one fourth in just two months. This is the power of sentiment and liquidity.

* In spite of the bearish sentiment, HUL & ITC are holding rock solid. They corrected merely 10~20% from their recent highs in Jan’08 and are a safe bet in these conditions.

* Shares of Polyplex Corporation (Rs.146) are being acquired by persons in the know, who expect a consolidated EPS of Rs.60.

* The share of Micro Technologies (Rs.192) is an excellent buy in view of its likely EPS of Rs.50.

* The share of IVR Prime (Rs.170) is available at a discount of almost 70% and is good for the long-term.

* Savera Industries, which is likely to achieve an EPS of Rs.14 in the current year is a good pick for decent gains.

* Orient Abrasives (Rs.18/19) which set up captive power plant at a cost of Rs.36 cr. can be picked up for sizeable gains of over 50%.

* MSP Steel, which has been allotted captive coal mines, has chalked out major expansion and diversification plans can be grabbed at every decline.

* With a likely EPS of Rs.36, the shares of Ramsarup Industries (Rs.137) can be accumulated for steady appreciation.

* Jindal Poly Films (Rs.166) is likely to achieve an EPS of Rs.60 in the current year and shrewd investors have lined up the counter. It is near completing its Rs.350 cr. expansion, which would take its EPS to Rs.70 in FY09 and to Rs.90 in FY10.

* Orchid Chemicals has crashed on FII selling and is a good buy for the medium term. Its management has messed up the finances by high leveraging but it has a string R&D success and good pharma products.

* Bodal Chemicals is a safe hold at Rs.45 ex-rights considering its good dividend payout and diversified product mix.

* Now is the time to buy into mutual funds that raised funds in February and March and have cash to deploy. Select funds with minimal administration charges.

* With crude oil prices hitting the roof, oil exploration stocks should perk up. Ironically, there are no takers for low P/E oil exploration stocks like Asian Oilfields or Selan Exploration, which will be grabbed on change in sentiment.

* Don’t buy any property as real estate may drop by 20%-30%.

* If Sensex breaks 14,200 it may go down to 13300/12400/8800 says a technical analyst.

FIFTY FIFTY

* Lakshmi Electrical Control (Rs.263.95) manufactures contactors, thermal overload relays, control relays, electrical control panels and industrial plastic components.Its Fy07 EPS was Rs.31 while FY08 EPS is likely to be around Rs.40/42 level.The stock has reacted from a high of Rs.589 to CMP of Rs.263. The market cap is just Rs.66 cr.Risk factor is the rising raw material and manpower costs along with a slowdown in industry, which will affect margins.Investors can benefit from this reaction and accumulate this stock on dips for good long-term growth.

* Patel Airtemp (Rs.46.80) is engaged in the manufacture and sale of extensive range of Heat Exchangers such as Shell & Tube type, Finned tube type and Air cooled Heat Exchangers, Pressure Vessels, Air-conditioning and Refrigeration equipments and Turnkey HVAC Projects in India and exports. The company has technical collaboration with M/s. TEK FINS Inc. USA for design and manufacture of Air cooled Heat Exchangers. All these products are supplied to leading industrial sectors like Power Projects, Refineries, Fertilizers, Cement Plants, Petrochemicals, Pharmaceuticals, Textiles and Chemical Industries.The order position of the company is good and it is performing well in the current year. If its first 9 months working is any indication company, it should report an EPS of around Rs.9 in the current year.The stock has reacted from high of Rs.145 to the current level where its market cap is just Rs.25 cr. Accumulate at current levels or at dips.

* Nava Bharat Ventures (Rs.193.55) is into sugar, ferro alloys and power generation. It is said to be doing well. The stock has reacted from a high of Rs.352 to the current level. Investors can keep a watch to add this stock on reactions.

* PAE Ltd. (Rs.19.25) is in the automotive and non-automotive (industrial) segments of batteries and components/systems The power segment presents its new growth opportunities as PAE has launched power back-up devices and systems and sees excellent growth potential for them. It is a profit making and dividend paying company. In the current year expected EPS is around Rs.5/6. Last dividend was around 10%, which is likely to rise to 12% in the current year. At present, market cap is just Rs.19 cr. The stock has reacted from a high of Rs.54 to the current level of Rs.19 where it looks very attractive for investment.

* Torrent Cables (Rs.180) - Those who booked profits at higher levels can add this stock at the current level of Rs.180 or on dips. Full year expected EPS is Rs.38/40.

*ABG Shipyard (Rs.595) is another fundamentally strong stock, which investors can add on reaction.

* Sesa Goa (Rs.3160.95) - Firm iron ore price may give a good push to this stock.

* Investors should take advantage of this free fall of mid-caps and accumulate fundamentally strong stocks with good dividend yield like PNB Gilts, First Leasing, Tata Metalik, Central Bank, Andhra Bank, Oriental Hotels, Supreme Industries to name a few.

Note: Several companies that have issued FCCBs face the prospect of not having these bonds converted into equity unless the stock markets stage a strong comeback.This implies that these corporations may have to pay back the amounts they borrowed together with the interest. Investors need to be careful of all such stocks.Tata Motors has made lower provision for tax for Q4, which indicates much lower profits. Auto ancillaries, too, are likely to suffer and may not post good results. This is in line with our warning about this sector.The market is likely to bottom out by the end of this month. Strong support level is expected to be around 14,000 or 12,700 in the worst case.Although 15th March 2008 Advance Tax collections appear encouraging, it is possible that many companies may not have made provisions for deferring tax or the full extent of FBT. Or they may have paid less tax in the first three quarters. This may be the reason for more taxes in the 4th quarter in some cases.Just see the case of First Leasing Company. It did not make any provision last year in the first three quarters for deferred tax but paid Rs.8.15 cr. as deferred tax in Q4, which reduced its profit at the net level last year. But in the current year, it has made provision for deferred tax of Rs.2.55 cr. in each quarter, which is as good as cash profit.

Hence investors need to be cautious about tax numbers and must understand them case by case.

Lotus Eye Care Hospitals plans IPOLotus Eye Care Hospitals, a South based premier eye care hospital and research institute dedicated to eradicating blindness and make eye care accessible to poor people will tap the capital market in FY09.It is also setting new trends in eye care by carrying out extensive research and using the latest technology. It has been the pioneer in inducting world-class technologies with the introduction of Multi-scan, Lasik, Epilasik and Zyoptix Z100.Located in Coimbatore, Salem and Tirupur, Lotus Eye Care Hospitals not only provides treatment for various eye diseases, but also offer comprehensive preventive measures and educational programs. These hospitals are equipped with ultra modern fourth generation instruments required for critical ophthalmic surgeries and offer comprehensive tertiary eye care.

LIC Housing Finance launches Reverse Mortgage for senior citizens:LIC Housing Finance Ltd. (LICHFL), a leading player in the Indian housing finance sector, has rolled out reverse mortgage loans for senior citizens above 60 years of age. The loan will be given on single or on joint basis with spouse, if the spouse is over 60 years.The reverse mortgage loan will be offered at a fixed interest rate subject to reset every 5 years. Under the reverse mortgage scheme, senior citizens can avail the loan on a monthly payment or a lump sum payment of a combination of both. The property evaluated for the loan should have at least 20 years of residual life.The maximum loan balance shall be restricted to 90% of the value of the property and the loan balance will include interest till maturity. The amount of the loan will take into consideration the property value, age of the borrower, rate of interest etc.The loan will become due and payable only when the last surviving borrower dies or opts to sell the home or permanently moves out of the home to an institution or to relatives.

Union Bank to provide online trading Union Bank of India and IDBI Capital Market Services Ltd., a leading provider of financial services in India have announced their strategic tie-up to offer IDBI’s internet trading services platform www.IDBIpaisabuilder.in to its customers.The integrated portal IDBIpaisabuilder.in allows customers to seamlessly execute their transactions as per their needs and demands. Thus any customer of Union Bank at any of its CBS branches can use this online trading platform from any place with an internet connection. When the customer indicates intention to purchase any security, his account is embarked with the amount and debited only when the transaction is put through his demat account credited in due course. Similarly, when he sells securities, lien is marked on the securities and his demat account is debited and his bank account is credited when the transaction is concluded.This new alliance is in line with IDBI Capital’s strategy of increasing its reach and penetration across the country. This also facilitates the creation of new business opportunities and seamless customer centricity by leveraging the core competencies of the both the organisations. It already has similar tie-ups with Punjab National Bank, IDBI, Oriental Bank of Commerce, Bank of Rajasthan and Karur Vysya Bank.