Gokaldas Exports

The stake buy comes at a time when RIL is trying to revive 'Only Vimal' and other textile brands of Reliance. Anand Jain, chairman of Jai Corp Ltd. and a confidante of Reliance Industries chairman Mukesh Ambani, has bought 6.64% equity stake in Gokaldas Exports. The acquisition of shares has been done through Vinamra Universal Traders - one of his investment firms. Moreover Jain’s name does not figure in the shareholders’s list submitted to the stock exchanges. The stock purchase in Gokaldas Exports is touted to be a part of ‘routine’ treasury investments by the group. Although an earlier report by ET said that Jain has bought 10% stake in Gokaldas, the stock exchange filing mentions 6.64% only. Interestingly, Jain’s acquisition comes at the same time as the Reliance Industries’ attempt to revive ‘Only Vimal’ and other textile brands which now earn less than 1% of revenues for them. RIL had started as a textile company in 1979. Blackstone had acquired a 50% stake in Gokaldas from its promoters last year. The deal was sealed at Rs 275 a share, 20% higher than the current market price at that time. The mandatory open offer to shareholders followed, which increased Blackstone’s stake to 68%. As a result, the Hinduja family’s shareholding had come down to 20%. Blackstone had spent close to Rs 600 crore just before the stock market started collapsing. The management of Gokaldas, a readymade garment manufacturer, is run by the Hinduja family, even though Blackstone holds majority shares. Moreover, the concentration of 98% shares among three shareholders — Blackstone, the Hindujas and Jain (through Vinamra) — has left little room for any trading to be done and as a result Gokaldas has become a highly illiquid stock. Lastly shares were purchased on 22 January and 11 January this year in bulk deals of 3.25 lakh shares at Rs 266.5/sh and 1.73 lakh shares at Rs 268.7/ sh respectively. Meanwhile Gokaldas has denied the rumors that Blackstone is planning to delist and then relist the firm as and when market condition improves. Anand Jain was appointed Chairman of Jai Corp in June this year only. Jai Corp is into manufacturing businesses like steel, plastic processing and spinning yarn and has newly started focusing and investing in emerging opportunities like developing SEZs, infrastructure, venture capital and real estate. Recently Jai Corp was believed to be foraying into city gas, LPG distribution. Since the split between the warring Ambani brothers, Jai Corp has been getting into businesses in which the Anil Ambani group has a presence. There have been quite a few PE deals in textile sector in the past also that include Wilbur Ross promoted WL Ross & Co. LLC acquiring OCM India back in 2006 for $37 mn and Citi Venture Capital investing Rs 81 cr in textile firm, Spentex Industries in late 2005.

Glenmark Pharmaceuticals

Cluster: Apple Green Recommendation: Buy/Hold Price target: Rs555 Current market price: Rs258 Price target revised to Rs555; maintain ‘Hold’ Result highlights Glenmark Pharmaceuticals (Glenmark) has reported a strong performance for Q2FY2009, with higher than expected revenues and profits. The company’s revenues grew by 49.2% to Rs560.9 crore on the back of an 85.8% growth in the generic business and a 29.2% growth in the specialty business. The operating profit margin (OPM) declined by 160 basis points to 30.2% on a year-on-year (y-o-y) basis, primarily on account of higher raw material and staff costs. The margin was slightly above our estimate of 29.5%. Consequently, the operating profit grew by 41.7% to Rs169.4 crore. Glenmark has reported a net profit of Rs117.4 crore for Q2FY2009 and the same is marginally ahead of our estimate of Rs111 crore. The profit growth was aided by a ten-fold jump in the other income during the quarter. On the other hand, a higher tax incidence (31.6% in Q2FY2009 against 18.0% in Q2FY2008) restricted the profit after tax (PAT) growth. In H1FY2009 Glenmark delivered profits of $58 million, which is only 27% of its FY2009 profit guidance of $210 million (which includes $69 million in outlicencing revenues). However, the company remains confident of achieving its guidance on the back of a much stronger H2FY2009 performance, driven by robust performances across Europe, semi-regulated markets and Latin American markets, and milestone receipts from the closure of at least two more outlicencing deals by the end of FY2009. Since Glenmark has a historical track record of consistently outperforming its guidance, we remain confident on the company’s ability to achieve its guidance. Eli Lilly’s decision to suspend clinical trials of GRC-6211 in osteoarthritis pain is a setback for Glenmark’s research and development (R&D) efforts and would affect the option value on this front. Consequently, we assign a higher risk premium to the research pipeline, exclude the value of Oglemilast in Europe (since the outlicencing deal has not yet happened), exclude the value of GRC 6211 (since the molecule has been suspended by Eli Lilly) and reduce our target multiple for the core business from 18x to 15x. Using these assumptions, we derive a fair value of Rs97 per share for the R&D business (against Rs204 per share earlier) and Rs458 per share for the core business (against Rs550 per share earlier). Thus, we arrive at our new sum-of-the-parts-price target of Rs555 for Glenmark. The stock has corrected significantly since the news of the failure of GRC 6211 and is currently available at 13.2x its core FY2009 earnings and at 8.4x its core FY2010 earnings, which is a significant discount to its peers. Though the negative development on GRC 6211 is largely priced in after the steep correction, the stock can continue to languish given the weak sentiments and market conditions. However, the situation could improve if some of the anticipated triggers play out over the next 6-12 months. These include the renegotiation of an outlicencing deal for Melogliptin, the announcement of an outlicencing deal for Oglemilast for the European region and the progress on the already initiated Phase II b trials for Oglemilast in asthma. Thus, buy/Hold recommendation on the stock.

Gold Declines in London

Gold Declines in London as Dollar Rises. Investors Seek Cash.

By Rachel Graham.

Oct. 27 (Bloomberg) -- Gold fell in London, extending two weekly drops, as the dollar gained against currencies including the euro, diminishing the appeal of the metal as an alternative investment. Platinum also declined. The euro has declined 12 percent against the dollar this month, while the pound is almost 14 percent lower. Equity markets tumbled in Europe and Asia on concern that a weakening global economy will sap corporate earnings, spurring investors to sell assets to raise cash. The rising dollar ``is fuelling the gold selling,'' said Wolfgang Wrzesniok-Rossbach, head of marketing and sales at Hanau, Germany-based Heraeus Metallhandels GmbH, which owns five precious metals refineries. Gold for immediate delivery fell $23.55, or 3.2 percent, to $711.20 an ounce as of 8:46 a.m. in London. Futures for December dropped $18.40, or 2.5 percent, to $711.90 in electronic trading on the Comex division of the New York Mercantile Exchange. Jewelry demand from India, the biggest buyer, has weakened because of a weaker rupee, Wrzesniok-Rossbach said. The dollar has risen 28 percent against the rupee this year. ``If people stop buying cars it's hard to imagine they are buying much jewelry,'' Wrzesniok-Rossbach said. ``We're hearing gold sales to India have virtually come to a standstill.'' Indian demand traditionally gains in the second-half of the year, spurred by Diwali, the Festival of Light. Hedge-fund managers and other large speculators decreased their net-long position in New York gold futures in the week ended Oct. 21, according to U.S. Commodity Futures Trading Commission data. Speculative long positions, or bets prices will rise, outnumbered short positions by 99,202 contracts on Comex, the Washington-based commission said. Among other metals for immediate delivery, silver fell 46.13 cents, or 4.9 percent, to $8.8988 an ounce, platinum dropped $26.50, or 3.3 percent, to $774 an ounce and palladium fell $2, or 1.2 percent, to $168. To contact the reporter on this story: Rachel Graham in London at rgraham13@bloomberg.net

अब जापानी दिवालिया होने .................

Oct. 10 (Bloomberg) -- Yamato Life Insurance Co., a Japanese insurer, filed for court protection from creditors in the nation's first bankruptcy in the industry in seven years, with debt exceeding assets by 11.5 billion yen ($116 million). A decline in the value of securities holdings widened losses at the Tokyo-based company, whose debts total 269.5 billion yen, Yamato Life said at a press briefing in Tokyo. The global credit crisis sparked by the U.S. subprime collapse has wiped out more than $670 billion in market value from the Tokyo Stock Exchange's first section this week as investors flee equities. The collapse of closely held Yamato is the eighth by a Japanese life insurer since World War II, according to Teikoku Databank Ltd. ``The fact that insurers are starting to struggle with their investments is a harbinger that even pension funds may start to suffer given the market environment,'' said Tetsuo Inoue, chief strategist at Proud Asset Management Japan Co. in Tokyo. ``It's a tough situation.'' The last collapse by a Japanese life insurer was in 2001, when Tokyo Mutual Life Insurance Co. filed for protection from creditors with debts of 980 billion yen. Kyoei Life Insurance Co. filed for protection in 2000 in Japan's biggest postwar corporate collapse, with debts of 4.5 trillion yen. Yamato Life's solvency margin, which gauges its ability to pay policyholders, stood at 26.9 percent, according to company President Takeo Nakazono. The firm had shifted its assets to alternative investments, which accounted for about 30 percent of the total portfolio as of the end of September, to boost returns. The move ended up hurting the company as the global market collapsed, Nakazono said. Japan's corporate bankruptcies jumped 34 percent last month, the fastest pace in eight years, as exports slumped and the credit-market turmoil engulfed the world's second-largest economy. Bankruptcies rose to 1,408 cases in September from a year earlier, according to Tokyo Shoko Research Ltd.

प्रोवोगुए sells

further stake in realty unit Apparel retailer Provogue (India) Ltd said on Monday UK's LTG International Ltd will invest 569.7 million rupees to pick up 3.36 percent stake in a unit of real estate arm Prozone Enterprises Pvt Ltd. LTG is founded by Lewis Trust Group of UK and Prozone is a joint venture between Provogue and Liberty International Plc, according to a company statement. In April, Provogue sold 27 percent stake in the unit for 4.57 billion rupees to Triangle India Real Estate Fund, founded by Old Mutual Investment and ICS Realty. (Reuters)

एक हवाई यात्रा टिकट की कीमत मे मकान

Price of an air ticket worth a home in US Kumar Shankar Roy | TNN Chennai: Return tickets for Delhi-New York are priced around Rs 75,000, but with real estate prices crashing in the US, Indians could buy homes there for the same amount! Thanks to the bottom falling out of the US housing market and struggling families abandoning homes, unable to keep up with mortgage payments. A detailed look at US realty websites such as realtor.com, zillow.com and ziprealty.com show that homes with one bathroom and bedroom are being advertised at anywhere between $1,500-3000 (Rs 69,000-1.38 lakh), an incredible fact by itself, in places such as Detroit, Michigan, Jackson, Mississippi, and Cleveland, Ohio. ''The lowered residential property rates in many parts of the US can be attributed to the sub-prime crisis, which has caused a huge surplus of stock in the market, besides reducing liquidity, which slows down absorption,'' said Raminder Grover, MD, Homebay, a subsidiary of international property consultants Jones Lang LaSalle Meghraj. As per law, homes can be purchased by US residents, and the low prices could suit students travelling to US and techies sent for onsite operations. As per the RBI cap, an average Indian can invest upto $200,000 (Rs 93 lakh) in US real estate. ''Students live in apartments or as paying guests by shelling out $250-500 per month. If they or their parents can afford to pay money upfront, this might be a good option for students planning to stay for 1-2 years,'' said Sridevi, US counsellor for Valmiki Group, which processes study visas for US. Over 6% of US home loans are in arrears and around 1.5-2 million Americans have lost their homes to foreclosure in 2007. As in India, additional costs could be from the cost of borrowing, brokerage payable for the location of suitable property and registration of the purchase. For the likes of Rohan, an IT professional who is soon to be sent to New York for 3-6 months, a home could straightaway save $500-1000. Junior and middle-level techies get $400-600 per month as house allowance, while project managers and higher-ups are said to get even $1,000 per month. But students or techies going to states such as Nevada or California may not be as lucky.

प्रभुदास लीलाधर

IVRCL CMP: Rs 235.05 Target price: Rs 308 Broking house Prabhudas Lilladher has maintained its 'buy' rating on the stock saying the stock is attractively valued at 14.5 times FY09 (estimated) earnings and 11.2 times FY10E earnings at the current market price. "We expect the company to register a CAGR (compound annual growth rate) of 32% and 25% in revenues and PAT (profit after tax), respectively, for FY08-10(estimated)," said the broking house in a note to its clients. According to the broking outfit, a substantial order book growth would be the primary driver of revenues for the company. "The order book as on May 2008 stood at Rs 12,200 crore (year on year growth of 71%) as against Rs 7,100 crore. On account of focus on cash contracts, IVRCL enjoys a healthy order book position amongst the peers," the note said. IVRCL has improved upon its Sales/WC (working capital) ratio at 1.9 times as against 1.7 times in FY07 and is expected to maintain the same, says the broking house. "We believe that NWC (net working capital) position in future will depend upon order intake and projects reaching revenue reorganisation level," the note added.

Compact डिस्क, Reliance मनी, Carnation ऑटो

iMedia to invest $10 mn in Compact Disc

Integrated media and entertainment company Compact Disc India (CDI) on Tuesday said content developer iMedia Ventures will invest $10 million in the company and is interested to pick up 15 per cent stake in it. In a filing to the Bombay Stock Exchange, CDI said iMedia Ventures has offered to invest $10 million (about Rs 47 crore) in the company's expansion projects. (Indiantelevision)

Reliance Money to pick up 10% stake in NMCE

Reliance Money is moving fast on getting into the commodity exchange business. The Anil Ambani-owned Reliance Money said that it has received official approval to pick up 10 per cent stake at the National Multi Commodity Exchange (NMCE). Reliance Money had proposed to buy a strategic 26 per cent stake in NMCE, the third largest national commodity exchange based in Ahmedabad. NMCE had inducted Reliance Money chief executive officer Sudip Bandhopadhyay as a director in the exchange board. The apex commodities market regulator Forward Markets Commission (FMC) had forwarded the Reliance Money proposal to buy 26 per cent stake in NMCE to the Consumer Affairs Ministry that oversees commodity futures trading in India.

Azim Premji to invest $17 million in Carnation Auto

Azim Premji, backer of IT major Wipro, is believed to be investing $17 million (Rs 80 crore) to acquire a minority stake in Carnation Auto, a company floated by Jagdish Khattar, former managing director of Maruti Suzuki India, reports Business Standard. In addition to Premji, who will be investing through his investment arm, Premji Invest, IFCI ventures is reported as another investor in Carnation Auto, investing $5.9 million for a minority stake.