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vijay - dubai
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17 Aug 2008 21:11
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Hello friend. When vedanta group bought sesa and gave open offer @rs 2036, they were seeing the longterm value, today if you value sesagoa they have made 3 times in less than 2 years.
Any government policy, will not completely be against the industry, government will try to maintain certain equilibrium...secondly if govt interference increases the FDI & FII outflow will bring down the daily tax income for govt which comes from stkmarket.
Sesagoa will have enough scope to grow even with taxation, as spot prices / contract prices are at good levels for longterms as well as short term from whcih it will benefit.
Anyways its always the timing in market when you enter and exit a stock and re-enter if you believe in it at better levels.
In commodity sector steel prices will be more stable than other plays like oil...as demand is more & more.
Interesting article to read which was published today in gulf daily.
Abu Dhabi steel prices soar 91%
By Ahmed A. Elewa, Senior Reporter
Published: August 16, 2008, 23:51
Abu Dhabi: Limited domestic production and soaring international prices of building materials continued to drive the costs up substantially in Abu Dhabi last month, according to the emirate's Department of Planning and Economy (DPE).
DPE's monthly building materials index revealed a rise in the prices of construction steel and cement in July when compared to June, recording a rise of 91 and 46 per cent respectively since the beginning of the year.
"The average increase in the prices of various building materials last month varied sharply from 3 to 53 per cent, yet the fact remains that the overall prices have increased substantially during the first half of the year," said a report issued by the department.
"One of the reasons is the overwhelming demand in Abu Dhabi, where the value of development projects from 2004 to 2007 stood at Dh880 billion, with Dh200 billion additional projects expected this year alone," the report said.
The wide gap between the production and consumption of construction steel has been blamed for the market's imbalances.
In terms of production, Abu Dhabi was successful to raise its output from 383,700 tonnes in 2003 to 830,000 tonnes in 2007, and by the end of 2009 this figure is expected to exceed 1.5 million tonnes.
This projected increase is attributed to the expansion of Emirates Steel and the operation of new facilities, such as Gulf Steel Industries - which will begin production by the fourth quarter of 2008 with a capacity of 400,000 tonnes - and Union Steel which is still under construction.
"Nevertheless, the steel consumption pattern in the capital suggests the continuation of the imbalance for years to come, given that the average annual growth of consumption stood at 24.6 per cent during the past three years.
It rose from 1.69 million tonnes in 2006 to 2.11 million tonnes in 2007," the report said.
Increasing imports is a natural result of the wide gap of more than 39 per cent between consumption and production.
Steel imports grew from 806,000 tonnes in 2005 to 1.62 million tonnes in 2007, a 71.6 per cent increase.
"Only 5.7 per cent of the imports come through Abu Dhabi's ports, while the majority comes through Dubai," the report said.
The result was a 91 per cent increase in prices during the first half of 2008 from an average of Dh3,139 per tonne in January to Dh6,000 in June, with the rising costs of diesel and electricity by 40 per cent and labour by 15 per cent adding to the burdens faced by the domestic producers.
...
Any government policy, will not completely be against the industry, government will try to maintain certain equilibrium...secondly if govt interference increases the FDI & FII outflow will bring down the daily tax income for govt which comes from stkmarket.
Sesagoa will have enough scope to grow even with taxation, as spot prices / contract prices are at good levels for longterms as well as short term from whcih it will benefit.
Anyways its always the timing in market when you enter and exit a stock and re-enter if you believe in it at better levels.
In commodity sector steel prices will be more stable than other plays like oil...as demand is more & more.
Interesting article to read which was published today in gulf daily.
Abu Dhabi steel prices soar 91%
By Ahmed A. Elewa, Senior Reporter
Published: August 16, 2008, 23:51
Abu Dhabi: Limited domestic production and soaring international prices of building materials continued to drive the costs up substantially in Abu Dhabi last month, according to the emirate's Department of Planning and Economy (DPE).
DPE's monthly building materials index revealed a rise in the prices of construction steel and cement in July when compared to June, recording a rise of 91 and 46 per cent respectively since the beginning of the year.
"The average increase in the prices of various building materials last month varied sharply from 3 to 53 per cent, yet the fact remains that the overall prices have increased substantially during the first half of the year," said a report issued by the department.
"One of the reasons is the overwhelming demand in Abu Dhabi, where the value of development projects from 2004 to 2007 stood at Dh880 billion, with Dh200 billion additional projects expected this year alone," the report said.
The wide gap between the production and consumption of construction steel has been blamed for the market's imbalances.
In terms of production, Abu Dhabi was successful to raise its output from 383,700 tonnes in 2003 to 830,000 tonnes in 2007, and by the end of 2009 this figure is expected to exceed 1.5 million tonnes.
This projected increase is attributed to the expansion of Emirates Steel and the operation of new facilities, such as Gulf Steel Industries - which will begin production by the fourth quarter of 2008 with a capacity of 400,000 tonnes - and Union Steel which is still under construction.
"Nevertheless, the steel consumption pattern in the capital suggests the continuation of the imbalance for years to come, given that the average annual growth of consumption stood at 24.6 per cent during the past three years.
It rose from 1.69 million tonnes in 2006 to 2.11 million tonnes in 2007," the report said.
Increasing imports is a natural result of the wide gap of more than 39 per cent between consumption and production.
Steel imports grew from 806,000 tonnes in 2005 to 1.62 million tonnes in 2007, a 71.6 per cent increase.
"Only 5.7 per cent of the imports come through Abu Dhabi's ports, while the majority comes through Dubai," the report said.
The result was a 91 per cent increase in prices during the first half of 2008 from an average of Dh3,139 per tonne in January to Dh6,000 in June, with the rising costs of diesel and electricity by 40 per cent and labour by 15 per cent adding to the burdens faced by the domestic producers.
...
03 Aug 2008 04:03
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Tracked by: 1 Boarder
# Sesagoa ranked 32 based on reported profit earnings for 20008,
Hi Sri, its good to analsye before investing not just following messages or tips or else you will end up trap.
SESAGOA is in top 100 indian companies, reference business & economy 10th July edition 2008.
# Sesagoa ranked 32 based on reported profit earnings for 20008, with RIL leading on top.
# On Sales revenue its @ 70 position.
# on gross profit margins its @ 59 position.
# Reserve and surplus position its @ 72 with 2751crores cash reserve + plus add 650+crs of 1st qtr.
# No.11 position on high dividend payout.
with current eps of 160x4qtr = eps 640 may be more !! as qtr on qtr earning will improve. are you comparing with previous qtr 202 ??
sesa goa has 2750cr surplus as on march, so add another 650cr with 1st qtr eps. so book value =890
Sesagoa equity currently 4cr approx shares, of which 88% is with promoters and FII, Instituions.
my view is that after split and bonus it will head to rs300-400 in coming months atleast not august.
As short term investors will offload the stock after split and bonus, and institutions will add up.
I did my own analysis and entered at 2800, though it looked expensive at that time, but now it looks it was good price shoould have bought more....!! what i feel is its a good stock which will outperform, based on fundamentals, valuations, and management, who are declaring not healthy generous dividends and now bonus.
With eps between of Rs 35 to 45+ after split& bonus on Re 1 face value.
Keep a watch on Reliance & RPL with gas and refinery starting.
Thanks for vishes,,,,vijay...
Hi Sri, its good to analsye before investing not just following messages or tips or else you will end up trap.
SESAGOA is in top 100 indian companies, reference business & economy 10th July edition 2008.
# Sesagoa ranked 32 based on reported profit earnings for 20008, with RIL leading on top.
# On Sales revenue its @ 70 position.
# on gross profit margins its @ 59 position.
# Reserve and surplus position its @ 72 with 2751crores cash reserve + plus add 650+crs of 1st qtr.
# No.11 position on high dividend payout.
with current eps of 160x4qtr = eps 640 may be more !! as qtr on qtr earning will improve. are you comparing with previous qtr 202 ??
sesa goa has 2750cr surplus as on march, so add another 650cr with 1st qtr eps. so book value =890
Sesagoa equity currently 4cr approx shares, of which 88% is with promoters and FII, Instituions.
my view is that after split and bonus it will head to rs300-400 in coming months atleast not august.
As short term investors will offload the stock after split and bonus, and institutions will add up.
I did my own analysis and entered at 2800, though it looked expensive at that time, but now it looks it was good price shoould have bought more....!! what i feel is its a good stock which will outperform, based on fundamentals, valuations, and management, who are declaring not healthy generous dividends and now bonus.
With eps between of Rs 35 to 45+ after split& bonus on Re 1 face value.
Keep a watch on Reliance & RPL with gas and refinery starting.
Thanks for vishes,,,,vijay...
02 Aug 2008 04:05
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Good analysis Sri,
So you waiting for 9 trading days to catch it @ 2600-2700 !!.
Good luck. No hardfeeling, markets will go up and down, its a cycle. if you cant time it, better be a fence sitter.
I think you have not seen the results 9 days back, how SESAGOA fundamentals improved and have consolidated further and improved strength to strength.
Anyways Goodluck, by the way which stocks you suggest to buy !! in current market
...
So you waiting for 9 trading days to catch it @ 2600-2700 !!.
Good luck. No hardfeeling, markets will go up and down, its a cycle. if you cant time it, better be a fence sitter.
I think you have not seen the results 9 days back, how SESAGOA fundamentals improved and have consolidated further and improved strength to strength.
Anyways Goodluck, by the way which stocks you suggest to buy !! in current market
...
31 Jul 2008 22:09
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Hello friend, since i told sesagoa has moved from 3100 to 3373, sesagoa target is 5000-6400. [post split 250-300]
Secondly with split and bonus price will drop down to @ 170 at current rate which will 3PE. if it reaches 4400 before split it will price will be 220.
the reason split and bonus is given is Book value is 700+ now, secondly with split more liquidity in market.
people tend not buying a 1share of 3300 instead they go for 110shares of rs30.
Sesagoa equity currently 4cr approx shares, of which 88% is with promoters and FII, Instituions.
volume will increase in sesagoa after split and will be included in sensex or nifty after splits and bonus.
after split and bonus it will head to rs300 in coming months.
Anyways do your ownreaserch before investing, what i feel is its a good buy in current market, based on fundamentals, valuations, and management, who are declaring 450% dividends and now bonus.
With eps of Rs 35 to 40+ after split& bonus on Re 1 face value, you can judge yourselves
good luck...
Secondly with split and bonus price will drop down to @ 170 at current rate which will 3PE. if it reaches 4400 before split it will price will be 220.
the reason split and bonus is given is Book value is 700+ now, secondly with split more liquidity in market.
people tend not buying a 1share of 3300 instead they go for 110shares of rs30.
Sesagoa equity currently 4cr approx shares, of which 88% is with promoters and FII, Instituions.
volume will increase in sesagoa after split and will be included in sensex or nifty after splits and bonus.
after split and bonus it will head to rs300 in coming months.
Anyways do your ownreaserch before investing, what i feel is its a good buy in current market, based on fundamentals, valuations, and management, who are declaring 450% dividends and now bonus.
With eps of Rs 35 to 40+ after split& bonus on Re 1 face value, you can judge yourselves
good luck...
31 Jul 2008 21:39
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Hello Ramji, dont get disheartened, BSEL is a good company doing good business in UAE. Their projects are online, it will not get affected by interest hikes, as interest rates in uae are still low, @ 6-7%. If you can hold the stock its a good at this price.once mutual fund eye this stock. its currently @ 2PE, once markets correct you find it moving.
Other option is Partly sell and buy Sesagoa, a front line stock, which is due for split and bonus this month, returns what you get on sesagoa you can buy and average bsel.
with increasing interest rates borrowings of infra companies will have effect on their balance sheet.
But BSEL will be least affected with this, due their bulk of revenue will come from Dubai project, and in big numbers, as projects are moving upstream.
My view is dont withdraw from market, this is testing time.
Good luck.
...
Other option is Partly sell and buy Sesagoa, a front line stock, which is due for split and bonus this month, returns what you get on sesagoa you can buy and average bsel.
with increasing interest rates borrowings of infra companies will have effect on their balance sheet.
But BSEL will be least affected with this, due their bulk of revenue will come from Dubai project, and in big numbers, as projects are moving upstream.
My view is dont withdraw from market, this is testing time.
Good luck.
...
31 Jul 2008 21:01
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Thanks- With promoters like VEDANTA, who are consolidating in industry, this has been value pick, which should good returns. Even with moderate view, after split and bonus, this scrip will see 450 in short to mid term, if markets raises this target is short term by next quarter results only....
30 Jul 2008 19:37
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