Realty stocks - trick or treat?

Hey readers, I've been in a flashback sort of a mood for the last couple of days. Looking at the late buying spree witnessed towards the close of yesterday's trading session, my mind went back to the time of last year's Diwali and the two months after that when the market scaled one peak after another. While the rise of the market was stupendous, the fall has been much more sensational. India had the distinction of being the seocnd best market among the emerging economies in 2007; in 2008, it has the distinction of being the third worst performing economy after Russia and South Korea. I guess we just can't shrug off the Russian influence, how hard we may try, can we?

While equities across all sectors have corrected severely, I've been dumbstruck with the correction in the prices of realty stocks. DLF, which touched a high of Rs. 1,250 last year, is now trading just above Rs. 200/-!! Look at Parsvnath Developers - it touched a high of Rs. 598/- in January 2008, yesterday, it closed slightly over Rs. 40/-!! And rest assured, there have not been any stock splits or earth-shattering fundamentally negative news in any of these stocks to make them behave in the manner they have in the recent global meltdown.

I wonder what I would have done if a prophet had whispered in my ears about the upcoming doom of these stocks - I guess I would have probably ignored the call, certifying the poor person as insane! But having the latest carnage, I feel wiser and certainly, much poorer! So much for experience! When investors lose confidence, even the sound fundamentals can't save a vibrant economy like India's! Anyways, the current recovery in the markets should continue given the massive interest rate cuts announced by the RBI today.. I believe a strong gap up opening is on the cards - hope the banks follow these rate cuts with cuts of their own which should reduce the burden on the shoulders of those weighed down by their home loans. I think another rally in the realty stocks is on the cards - now whether it will be sustained or not is entirely your call.

I am off to read Robin Cook's Critical and later catch Horton Hears a Who and Ice Age 2 - purchased the novel and the DVDs of these movies yesterday! Have a great weekend!

Up, up and away!

Hey readers, Gmail has finally been banned in office and after 30 months since first joining this company, I've resigned -- well, I'd expected to feel sad and nostalgic but currently I feel pretty numb!

Anyways, what a stupendous rise in the indexes today - over a 5% increase. The markets needed a positive sign and with DLF signalling a shares buyback, the investors simply gave in to the news, with the realty index rising by over 12%.. Sure was good news for a sector that had born the brunt of the negative market sentiment in the last 6 months!

More on this and the above later - time for me to head home now!

Back again with the stocks to buy!!

U.S. markets opened in the positive for the second successive trading session and if recent data and the incentives announced to revive the economy are to be believed, then the fears of the U.S. economy slipping into an recession have been blown away for some time. Despite the poor show of the Reliance Power IPO and lack of investors' interest in the IPOs post the Reliance Power issue, the Indian markets look set to gain some lost ground in the coming days. A careful analysis of the large, mid and the small caps will help you make a killing and pick up some cheap stocks at a heavy discount! So here are my picks, which I expect to do well in the first half of this year.. So, get set readers, the Sensex is ready to put on the rocket boosters and make a high jump!!!!!!!!! Here are my picks for the forthcoming months:


1) NTPC -- http://www.ntpc.co.in/


With an installed generating capacity of over 28,ooo MW and with expansions plans to raise the generating capacity to over 50,000 MW by 2012, this goveernment-owned power company is set to grab a major chunk of the $250 billion which is going to be pumped into India for the improvement of the country's infrastructure. Much better valued and placed than either Reliance Power and Tata Motors, shares of this undervalued company may prove to be the real diamonds in one's portfolio.



2) Ranbaxy -- http://www.ranbaxy.com/


One of the Indian Pharmaceutical giants, this company is set to grow via acquisitions and unlock the value inherent in the company via demergers. It is a good defensive stock to own in one's portfolio. Sample this: In the last 1 month, when the market has corrected by over 25%, this stock fell by only 5%.. just goes to show the fundamentals of this stock! Truly, a gem to treasure.


3) DLF -- http://www.dlf.in/


Please forgive me if I'm misconstruing a lot of statistics and facts when I state that DLF is the FACE of the Indian Realty Sector. An innovator, a great thinker, a trend setter and an inspirer, DLF has delivered results where others have only promised! With the proposed listing of the company's Real Estate Investment Trust on the Singapore Stock exchange (SGX) by June 2008, this realty giant will give you the BANG for your bucks!


4) Indiabulls Financial Services (ILFS) -- http://www.indiabulls.com/


Almost all the financial services sector are diversifying into other arenas and markets, none will be able to match the speed of diversity with which ILFS will consolidate its hold in the financial services sector to carve out a niche for itself in lucrative arenas like infrastructure, casino and gambling.. This seems like the right time to build a position in this stock as the shares are down relatively; this is a sharp shooter and expect handsome gains from this stock. However, a word of caution here -- ILFS shares tend to touch and then slip off the peak.. So keep an eye on the movement of this stock!

Currently I have time to give you a brief insight into these select stocks only.. I'll be looking to publish another post shortly with a few more names which will help you to strike the right balance between aggression, caution and retuns! So, keep tuning in to this space!