Weekly Market Outlook - Preview - 1st Week of December - Update

Dear All,

Out of the 4 stock picks sent, 2 calls were completed and 2 reached Target 3. We also achieved a 3.4% return on the total capital invested or over 30% return in the futures space on the margin amount invested.

Do subscribe to our weekly market outlook services and thank you'll for visiting and following our blog.

In a bit of a rush due to the wedding season but will keep updating our fellow investors via email.

Dewang

Weekly Market Outlook - Preview - 1st Week of December

Dear All,

I have tried uploading a preview of the Weekly market outlook we send out every week via email to our fellow investors. Do subscribe to this service by dropping us an email - dewang@denip.in or nimesh@denip.in

Thank you'll for following and visiting our blog.

Notes:

All prices relate to the NSE, unless otherwise mentioned. Stop-loss levels might be given so that there is a level below/above, which the market will tell us that the call has gone wrong. Stop-loss is an essential risk control mechanism; it should always be there. Investors should set stop loss levels according to their own estimates. Book, at least, part profits when the prices reach their targets; if you continue to hold on to positions then use trailing stops to lock in your profits. Don't chase a stock, if you are unable to buy a stock because it hits circuit levels on successive days, don't buy that. DENIP Consultants Pvt. Ltd., the blog owners, our clients and all related entities may or may not have positions in the securities mentioned above. Trading involves considerable risk. Trade at your own risk to the extent you are comfortable. All the money you invest to buy the shares can be lost. DENIP Consultants Pvt. Ltd. or the blog or the moderators or the blog owners or any related entities shall not be responsible for any losses incurred for acting on these recommendations. Take the advice of your own financial advisor and do your own research before entering the stock.

Tax Planning at DENIP Consultants.

Investment options to maximize tax benefits available under Sec 80C & 80D. Maximum benefit available under this section is Rs. 1 lakh. At DENIP Consultants Pvt. Ltd., we suggest our clients different instruments that helps them in availing maximum benefits under section 80c and 80D.

1. ELSS (Equity Linked Savings Scheme):

High risk, high return product. It is also one of the options where the lock in is least, i.e. 3 years. Maximum limit under 80C is rs. 1 lakh. SIP (Systematic Investment Plan) is a good way to invest in this ELSS as it averages your cost over the year by buying every month. SIP is one of the best option as it allows one to invest regularly and contribution of small amounts every month leads to accumulation of wealth annually.

2. Insurance:

One should not just avail insurance policies for getting the Tax benefits. Insurance is very important for an individual and it should be done after taking into consideration the dependents in the family. We suggest the instruments to our clients on the basis of his dependants and tax liability.

3. Medical insurance:

One can avail up to Rs 15,000 deduction on medical premium of himself, spouse and dependents. In addition, medical insurance premiums for your parents, is eligible for another deduction of up to Rs 15000 and up to Rs 20,000 if they are senior citizens. Medical insurance is very important for all the indiciduals and every one should have it. We suggest this instrument taking into consideration various factors like age, illness (previous), capacity to pay the medical insurance, etc.

4. PPF account:

Public Provident Fund (PPF) is one of the safest debt products where you can invest up to Rs. 70000 every year. The investment done every year is exempt from taxes and the interest and maturity is exempted. 

 Benifits of Tax Planning at DENIP Consutants:

• Professional Advice on selection of instruments.
• All instruments under one roof.
• Systematic processing of applications.
• Quick and efficient service for all clients.
• We distribute tax planning products of all AMC's and Insurance Companies (LIC, ICICI, Bajaj).

Terrible Thursday

So, we were hit with one of the most confusing days in trading. The market opened flat to low in the morning and witnessed short covering during the mid of the trading session. Around 1pm it seemed that we might witness the Nifty rise since there were several stocks holding their ground e.g. SBI, Siemens, Ranbaxy, Tata Power etc.

The Chinese markets were weighing heavy on us and hence we saw the cut in the early hours. However once the Chinese markets ended their day we were witnessing short covering which led the Nifty in almost the green territory.

However this was not to last, and before the European Markets opened we were hit with the news of Debt fear in Dubai. You can read more on the same at the below mentioned link.

http://finance.yahoo.com/news/Dubai-debt-fears-hit-world-apf-3624614071.html?x=0&sec=topStories&pos=2&asset=&ccode=

Once this news hit the market there was no looking back, EU opened almost 1% negative and Nifty ended the day down 100+ odd points. There has been no improvement since then and right now the EU markets ended their day down almost 3%+ in the red.

This makes me wonder whether there is still another 1% cut left for our markets or not since both the Chinese and EU markets were down by over 3%. It seems like Thanksgiving has gone terribly wrong for the investors worldwide and the US Investors are really happy that it was Thanksgiving due to which their market was shut.

So whats there in store for us going forward?? Let's understand the current scene to the best of our abilities first

1. Dollar is weakening and seems like there is not much support left for it besides the Holiday season sales in the US. However with the unemployment rate above 10% and employment budgets squeezed I do not think that there is much left to save the dollar at least this year.
2. Inflation risk is rising in Emerging Markets due to which we are going to see credit tightening in the market in the first quarter.
3. Markets have had a huge run up due to free money available in the market but investors worldwide still believe in the India as well as other EM growth stories.
4. Lot of QIPs and primary market paper has hit the market due to which excess liquidity is squeezed out for sure.

Keeping this in mind there are a few options we Indian Investors are left with

1. Buy Gold and wait till we are hit with huge inflation numbers
2. Avoid buying into the Banking sectors since we are going to see credit policy tightening
3. Buy Indian Rs. since we will see credit tightening
4. Equity assets will see some buying interest due to the need for high risk high return

Now that we have established a bit of the macro-economic scenario lets get down to technical analysis.

On the charts, Nifty has strong support from 4775 - 4950 levels on a weekly basis. On daily basis we see support from 4900 -5000 levels which might help the Nifty take a stance in this series. Considering this scenario, you might want to start avoiding high beta stocks and get into defensives.

There are a lot of optimists out there who might need a reality check as per the charts. I believe that as per the charts there is still some correction left in the market. Bank Nifty (CMP: 9067) can be shorted by high risk investors for a target of 8890.

This being our first Market View post, I do not want to sound like a doomsday analyst but want to let all my fellow investors out there to be patient and wait for falls in the market to start buying.

Do not fall prey to analysts predicting 5200 -5400 on the Nifty yet. These levels will come but there is a lot of time left before we see those kind of levels. I also believe that these levels might turn out to be only a shorting opportunity in the market for the investors.

I have taken a look at a lot of charts and to be very honest all the stocks are almost on the verge of breaking down. However in such a liquidity driven market its best to wait for buying at lower levels rather than shorting the market.

For the moment stay cash heavy and wait for the right time to invest. Invest safe and earn more from the markets. Just drop us an email at dewang@denip.in or nimesh@denip.in to subscribe to our weekly stock pick services.

Notes:

All prices relate to the NSE, unless otherwise mentioned. Stop-loss levels might be given so that there is a level below/above, which the market will tell us that the call has gone wrong. Stop-loss is an essential risk control mechanism; it should always be there. Investors should set stop loss levels according to their own estimates. Book, at least, part profits when the prices reach their targets; if you continue to hold on to positions then use trailing stops to lock in your profits. Don't chase a stock, if you are unable to buy a stock because it hits circuit levels on successive days, don't buy that. DENIP Consultants Pvt. Ltd., the blog owners, our clients and all related entities may or may not have positions in the securities mentioned above. Trading involves considerable risk. Trade at your own risk to the extent you are comfortable. All the money you invest to buy the shares can be lost. DENIP Consultants Pvt. Ltd. or the blog or the moderators or the blog owners or any related entities shall not be responsible for any losses incurred for acting on these recommendations. Take the advice of your own financial advisor and do your own research before entering the stock.

Siemens & SBI

We are of the view that if Siemens closes above 570 today then the stock could see levels of 590+ and similarly if State Bank of India closes above 2360 then the stock could see levels of 2420+.

Note:

All prices relate to the NSE, unless otherwise mentioned.

Stop-loss levels are given so that there is a level below/above, which the market will tell us that the call has gone wrong. Stop-loss is an essential risk control mechanism; it should always be there.

Book, at least, part profits when the prices reach their targets; if you continue to hold on to positions then use trailing stops to lock in your profits.

Don't chase a stock, if you are unable to buy a stock because it hits circuit levels on successive days, don't buy that.

DENIP Consultants Pvt. Ltd., the blog owners, our clients and all related entities may or may not have positions in the securities mentioned above.

Trading involves considerable risk. Trade at your own risk to the extent you are comfortable.

All the money you invest to buy the shares can be lost.

DENIP Consultants Pvt. Ltd. or the blog or the moderators or the blog owners or any related entities shall not be responsible for any losses incurred for acting on these recommendations. Take the advise of your own financial advisor and do your own research before entering the stock.

Ambani Brothers Top the Pay Charts for 2008-2009.

Anil Ambani earns the Highest Package; Mukesh Ambani is the highest Dividend earner.

Rank	Name	Company	Package in Cr.
1	Anil Ambani	ADAG	52
2	Kalanithi Maran	Sun Tv	37.8
3	Kaveri Maran	Sun Tv	37.8
4	P R R Rajha	Madras Cements	28.7
5	Naveen Jindal	Jindal Steel & Power	28.7

Rank	Name	Company	Dividend in Cr.
1	Mukesh Ambani	RIL	930
2	Azim Premji	Wipro	465
3	Shiv Nadar	HCL	320
4	Anil Ambani	ADAG	256
5	Kumar Birla	Birla Group	202

With a package of over Rs 52 crore in 2008-09, younger brother Anil has topped the list of executives in terms of compensation, while elder Mukesh has emerged as the country's highest dividend earner at Rs 930 crore.

It is the first time that Mukesh does not figure among top-10 executives in terms of compensation package ever since the magazine started compiling the annual list in 2002. Mukesh has been ranked at 19th position with a package of Rs 15 crore, owing to his voluntary salary cut of 66 per cent announced a few weeks ago.

Source: Business India magazine.

Market View - 24 Nov 2009

We believe that this week will continue to remain very volatile with a negative bias for the December series. Several stocks for e.g. Powergrid are seeing heavy short buildup. We advise our clients to get cash heavy so as to try and buy the stocks at cheaper rates in the market.


Although there are several analysts predicting 5250 / 5400 in the market we believe that markets will find it very difficult to cross the 5130 – 5175 supply zone. However if 5175 is crossed then 5300 becomes a possibility.

As far as stock ideas go we advise buying Balrampur chini at 126.

Result Day 1: Day high of 134.6 yesterday (intraday)

Result Day 2: Day high of 149.7 today

Dated: 24/11/2009

Market Views Services

Our Market Views Service provides investors with an outlook on the market on a weekly basis along with our stock picks and daily update on the stock picks given out. We will update the same on our blog regularly.

Anyone who wants to subscribe to the same can drop us an email at dewang@denip.in or nimesh@denip.in and we will add you to our advisory mailing list.

Selecting Company's Name and Making of Logo.

Lots of options came to our mind for registering the company name. For e.g. Acumen Consultants, Ace Financial Consultants, Concord Investments, Global-i Financial Solutions, etc. However, we wanted a unique name for our company. We decided to follow the approach that was used by the companies we admired and grew up wanting to work for; e.g. Goldman-Sachs, Ernst & Young, Morgan Stanley, Dell, Rare Enterprise etc.

One of the advantages we had is that we had all the expertise we needed within reach. We spoke to one of our dear friends and she helped us in deciding our company name: DENIP Consultants which has our initials inscribed in it: DE –Dewang, NI- Nimesh and P for Partners.

Logo for DENIP Consultants Private Limited:

Once we had the company name in place we decided to design a logo for our company which not only represented us but the company’s objective. Designing a logo for the company to us is very critical as it is the face of the company. There were several options coming in our mind, like using the initials of the letters DC and creating a design over same or use a figure and make it as the logo.

We realised that our company’s main objective is to create wealth for our clients by growing their capital. Hence, we decided that our logo should depict growth, capital gains and stability.

The first and last option that came to our mind was a Triangle. A triangle representing upward moment or depicting a sign of growth was something that was accurate enough for us. We did not think twice and finalized that we would use triangles in the company’s logo.

We then decided to use three triangles that represent the pillars of our organization. They are Professionalism, Integrity and Excellence. We believe in providing professional, world class (excellent) ethical (integrity) services to our clients which at any given point of time. Hence we decided to use 3 triangles in our logo. The 3 triangles also represented diversification not only for our business but also for our customers. The 3 triangles also represented us, the bottom 2 being Dewang and Nimesh and the third on top represented our customers and finally the 3 triangles also represent one way upward growth for our own selves, our customers and in turn our company.

The final step was to decide the colour of the Logo. The option that came to our minds was the colour which represents profit or advancement in our Industry, i.e. GREEN. Green not only represents profits but also money in the financial world. (Remember the word “Hari-Patti” which we’ve been hearing since we were kids?) Finally we conceived the logo and the company name DENIP Consultants Private Limted and the three green triangles.

Making of the Mission, Vision and Core Value.

We thought for long hours for deciding what should our Mission, Vision and Core Values should be. We wanted them to be very simple and easy for all to understand. Working twelve hours a day for nearly a week, we wrote down the Vision, Mission and the Core Values of the company.

After long hours of debate, we settled on a Mission Statement.

Mission Statement:

“Our mission is to understand our clients’ needs and respond by providing a range of profitable investment solutions.”

We believe in growing our client’s wealth by first understanding his requirements and then give him best possible solutions.

Having carved out our Mission Statement, we said, we now need a set of tangible, time bound Visions that will tell us whether we have succeeded or not. This was another long drawn out, but very satisfying session.

Vision statement:

“To be a global major in providing complete investment solutions and to provide best value for money to our clients through personalized service, superior efficiency and complete transparency.”

Like the Mission Statement, our Vision is deliberately simple. We want these to be clear, measurable and easy to remember. Each one has a set of reasoning behind it and collectively, they are linked to each other to form the foundation for our enterprise.

Having settled our Vision, we asked ourselves, what would be the "core values" upon which we will build the enterprise. Flowing from the Mission and the Vision, we settled for five core values.

These are:

Customer Delight: Commitment to always exceed our customers’ expectations.

Professionalism & Excellence: We will uphold the highest standards of professionalism and excellence while maintaining a high level of competency.

Quality in whatever we do :We believe in high quality services and pledge to deliver high-quality services to our customer in a cost-effective manner.

Transparency in Operations :We commit to be ethical, sincere and transparent in all our dealings.

Continuous Improvement :We will improve ourselves continuously to meet the changing needs of environment.

The Making of DENIP Consultants Pvt. Ltd.

This idea of starting an Investment Consulting Firm was lingering in the head of Mr. Nimesh Marfatia for a quite a while during his tenure with Angel Broking Ltd (Angel). The day the idea germinated in my mind, I thought of contacting Dewang Mehta, my friend cum brother, a MBA Graduate in Finance from K. J. Somaiya then working as a Consultant for Global eProcure(GeP). So, one day in March 2009, I called Dewang and invited him to dinner at The Sheesha’s Bandra.

15^th March, we agreed to meet & it turned out to be a day that changed our lives. At the restaurant, Dewang and I filled each other with the details of our life goals and it turned out that we both had similar ideas and goal of where to be in life.

On the business front, we agreed that there was space to create an Investment Consulting Company which would focus on growing the client’s investments and build long term personalized relationship with them. At first we were just talking ball park estimates but by the time dinner was over, we decided that we should meet more often and sculpt the future of this idea. We had several challenges to conceiving this venture:

• · Firstly, we were doing very well in our respective jobs and had possible salary and position bumps to think of.
• · Secondly, entering the business domain when people only understand jobs and feel that there is no place for business these days and that the businesses are not doing well.
• · Thirdly, entering a business which people only understand as speculation and gambling.
• · Creating a niche for ourselves when the market is filled with a million other players within the vicinity of 10kms.

All this required critical planning and documentation. However our commitment to this venture was much more than we had even imagined. We started meeting 4-5 times a week, finding time out of our busy schedules. We started discussing our plans for this venture while walking, eating and even before ending the day. Airtel was enjoying huge revenues out of us at that given point of time.

We had a couple of advantages during that time; our offices were just 2 minutes apart and both I and Nimesh could meet each other even for a sandwich and discuss the business venture in greater detail.

As days passed we got serious about this business idea and decided that we should put a pen to our thoughts and create a concrete business plan. Our educational qualification helped at such times. All those times during our engineering and management where we thought that documenting a business idea was a waste of time were being proved wrong. We were documenting our business covering hundreds of pages and excel sheets. We remembered the SDLC (system development life cycle for all you non-engineers out there), laughed about it (about how we used to RATTO the whole process and write it during our exams) and then put it to practice for our business.

Dewang did the excel sheets while Nimesh did the documentation. We started planning capital requirements, possible expenses, possible income, business associates, employee strength, office space etc. As a next step we started allocating dates for these ideas to convert them into executable business. We had targets at the end of every week, targets to meet business venture, ink long term deals, meet our advisors and well wishers, get the necessary certifications etc.

On the business front, we agreed that the best way to approach our business was to overestimate the expenses while underestimating the income that we could generate. We believe that in any enterprise, it is always a happy thing if your income exceeded your expectations but if your costs ever exceed your expectations, you are definitely in trouble.

After several hundred excel sheets and million discussions and debates on the same, we decided that we could fund our own business and that no capital was required from either our parents or friends or even the bank. However we agreed on one thing is that we will approach the Venture Capitalists once we decide to expand our business in the years to come.

At that point of time we had two people who were acting as major support to us, first Mr. Kishor Mehta who agreed to provide two of his office spaces to us for doing our business and second Mr. Jayesh Marfatia who provided vital information and support on how to run a private limited firm and the best way to conduct ethical business.

After the planning stage we decided to complete the requirements gathering stage. This felt like a stage which would take time but was over even before it started. All the educational requirements & qualifications were in place. We were certified for the capital markets (BSE/NSE Cash), derivatives market (BSE / NSE FO), commodity market (MCX/NCDEX), certified life insurance advisors (LIC / ICICI prudential), certified non-life insurance advisors (Bajaj Allianz / ICICI Lombard) & certified mutual fund advisors (AMFI certified and registered with all MF houses) within no time. However one more certification still remains for us i.e. Certified Financial Planners. We have the knowledge to do it but we respect both business and knowledge and will indulge into this business once we get the certification for it.

Once we had the certifications in place we were convinced about the workability; we started the process of registering the Organization in June. This process too was some experience for us, registering ourselves as directors, getting the digital signature, filling forms, processing documents etc. We were playing it defensive and ensuring that everything fell into place. We were helped by two people during this time i.e. Mr. Niranjan who is a qualified Chartered Accountant and Mr. Prasen Naithani who is a qualified company secretary. Finally after all those hassles we conceived our company on the 29^th of July and we named it DENIP Consultants Private Limited; officially registered with the ROC (Registrar Of Companies).