i Develop Stocks Advisory

Cobra strikes back How Indian markets behave which you all must have seen today…? We knew the inflation nos as well as IIP nos from our sources well before the announcement. We had also flashed message for all of you that please do not go short even if market is falling on weak inflation nos because the IIP nos were robust. This also needs to be read with our morning message where we had said the market will open positive and close positive which too happened though bears made all out attempt to dent the back of the bulls even today. We are happy to see our second stock has now crossed the buy intonation price that is none other than the elephant cum King Cobra. No doubt because of the bear attacks, RIL position holders had to go through lot of pain this time. But we stuck to our convictions as usual and made it possible once again to prove that CNI means serious business. For sure we will see that at least 80% of the pending calls will go through in next 30 days. Meanwhile we have clear focus of concentrating on B gr shares which are at the moment giving never thought of returns whether it was Asian Oil, RDB, Bhagwati, Avon or India Foils. I would have been more comfortable today if market could have closed above 16K but I can’t underestimate bears at this point in time. They have still their ideologies wire to take Sensex to 12K. It hardly mattered when inflation came at 7.41%. It means once again history may repeat “Market may keep on rising with every outburst of bad news”. Meanwhile FII too have started shifting their gears and entering quality B gr shares such as Gremach Infratech which was just on fire after we spotted the opportunity. Another stock which will rise 100% in next 30 days could be HEG and FII only will buy this stock. This means they have decided to strike 2 birds with one stone. Try to revise their existing valuations and also create buying opportunities instead of wasting energy. HEG is another brilliant story where investors can get at least 100% return for sure. In fact, investors can make merry with this stock simply by offloading 50% at 100 pc rise and rest they can hold till Rs 2500 with actual cost being free. But you will digest the bullet. We have generated a never desired sell call in Orchid Chemicals because it seems the entire transaction is not at arms length. The way the things are happening and media outburst is seen there is something beyond the headlines. The share price cannot sustain in such an environment though the price rigging can happen for couple of days. There is every possibility that Orchid promoters could approach the regulator for investigation of market transactions though on record it may not come forward to offer any comments. It seems very unlikely that Ranbaxy gr co too will make a hostile bid is such a manner to make an open offer. Because the moment the open offer is triggered there could be chance of market investigator to re jig the whole thing on its own. Ranbaxy has already reached close to 13% and they can buy max of another 1 or 1.5% post which the stock will lose its charm. If you look at history also share price corrects once the episode driving the price dies down. Very likely that the stock is at best price for FII’s to make exit and hence huge selling can’t be ruled out. In light of the fact, we have generated a sell call. The King Cobra is on fire and in real terms if you compare with other stocks then at Rs 2550 the stock has corrected by just 20% from its peak price and very soon it could cross the peak price. Short sellers can sell Nifty, they can even borrow RIL stocks for selling but what happens the buyers outnumber sellers…? At the moment RIL and RPL are the 2 counters where buyers are beaten the sellers. In fact, 3 leading brokers are hugely short in RPL since Rs 150 which I had mentioned even at that time. The rationale was RPL had huge forex derivative losses. Well today ICAI had made it clear that auditors need not report such losses if not speculative. Therefore even if there are losses it will not be reported as the chances of losses being speculative losses are very remote. Stock price is now almost 20% away from the selling price and yet short sellers have not realised that they have been trapped. Just wait RPL to cross Rs 200 mark there could be a positive announcement. Thereafter bears will have nightmare…. This is the reason Cni can’t advocate selling short at the rock bottom of the market. Yes, you may go wrong on a given day but for sure those who try to play on either side can’t make money on either side. Market knows it all is famous quote which may be proved once again in course of time. I cling to my imperfection, as the very essence of my being.