Networking major D-Link India jumped 18%, to Rs 100.55 on renewed buying.

Networking major D-Link India jumped 18%, to Rs 100.55 on renewed buying. The scrip rose on heavy volume of 34.8 lakh shares on BSE. After a sharp surge in early August 2006 – from Rs 75.40 on 9 August to Rs 87.25 on 16 August, the stock was range-bound. It moved between Rs 82 and Rs 90.

D-Link has on offer over 40 established products in the modems, switching and routing space. The company has a significant presence in networking products market. Its share of the Indian market for switches has been pegged at 12%, while enjoying 8% share for routing products and switches.

D-Link India is a part of the $1.2 billion Taiwan-based networking products major D-Link Corporation, a global wireless routers and modems manufacturer.

As per recent reports, D-Link Corporation plans to make India one of its manufacturing hubs, from where it intends to market products across the globe. D-Link Corp holds 36% stake in D-Link India. At present, D-Link India is a vendor to the global networking major that outsources a lot of products, including VoIP products such as IP-PBX, which are designed, developed and manufactured in India.

D-Link India also has a collaboration with Gigabyte to manufacturer motherboards in India.

For Q1 June 2006, D-Link reported 29.4% fall in net profit, to Rs 3.84 crore (Rs 5.44 crore). Sales rose 15.4%, to Rs 63.49 crore (Rs 55.01 crore).

The company has a tiny equity base of Rs 6 crore. The face value per share is Rs 2.

Rights issue propels Orient Paper

Rights issue propels Orient Paper. Orient Paper & Industries climbed 4.72% to Rs 610.90, after the board approved raising Rs 175 crore through a rights issue, to fund expansion. As many as 84,657 shares were traded on the BSE.

The stock, after rising sharply in a very short while, has started moving southwards from mid-September. From Rs 425.80 on 30 August, it has moved up to Rs 642.10 by 18 September 2006. Here, the stock slipped to Rs 583.35 by 4 October 2006.

The current price of Rs 610.90, discounts its trailing Q1 June 2006 annualized EPS of Rs 69.30, by a PE multiple of 8.81.

Orient Paper & Industries' board approved raising Rs 175 crore through a rights issue. The board has also approved the expansion of its cement capacity by 1 million tonnes per year; from 2.4 million tonnes to 3.4 million tonnes. This will result in an investment of Rs 66.5 crore against Rs 42 crore envisaged earlier.

Orient Paper & Industries derives nearly 50% of its turnover from cement business – the sector which has been witnessing strong growth due to firm cement prices and strong housing and infrastructure demand.

As much as 30% of its turnover is derived from the paper division and about 20% from fans, which it sells under the 'Orient' brand.

The company is setting up a captive power plant. The company expects savings of about Rs 100 per tonne of cement once the captive power plant goes on stream.

Currently debt-equity ratio is a huge 4.5:1, which the company expects to bring down to 1:1 in 18 months.

The company owns a huge property worth Rs 100 crore, which it is likely to sell.

For Q1 June 2006, Orient Paper & Industries reported 900.40% growth in net profit, to Rs 25.71 crore (Rs 2.57 crore). Net sales during the period rose 28.6%, to Rs 258.40 crore (Rs 201 crore).

Cinemax files for IPO

Cinemax files for IPO to offer 8.9 million shares through IPO. Cinema hall chain operator Cinemax India has filed papers with market regulator Securities Exchange Board of India (Sebi) for an initial public offering. The 8.9-million-share offer will constitute 31.86% of the post-issue share capital of the company.

The proceeds will be used for expansion and acquisitions, Cinemax said.

The company, which operates 33 cinema screens across 10 properties, reported a net profit of Rs 6.76 crore on a total income of Rs 43.86 crore in year ended March-2006.

HDFC Bank inflates anticipating robust Q2 report card

HDFC Bank inflates anticipating robust Q2 report card. HDFC Bank jumped 4.2% to Rs 929.95, as investors bet that it will post impressive Q2 results. 70,871 shares changed hands in the counter on BSE.

HDFC Bank witnessed a rally as the stock participated in a rally across the banking sector caused by continued lending growth in the banking sector. From Rs 698.25 on 19 July, it has risen 33% to current Rs 929.95. The rally has pushed the scrip to an all-time high. The stock's life-time closing high was Rs 927.55, on 28 September 2006.

At the current market price of Rs 929.95, the stock trades at 30.4 times its Q1 June 2006 annualized EPS of Rs 30.5, and 5.4 times its end-June 2006 adjusted book value of Rs 172.

The bank announces Q2 results on 17 October 2006. Sustained retail and corporate credit growth will lead to higher interest and fee income for HDFC Bank. Retail credit growth in India has maintained its momentum despite an increase in borrowing costs. HDFC Bank also has the advantage of low cost of funds due to a high proportion of current & saving account (CASA) deposits.

A domestic brokerage has forecast 28.5% growth in HDFC Bank's net profit growth for Q2 September 2006, at Rs 256.50 crore (Rs 199.60 crore). It has predicted 34.6% growth in its net interest income, to Rs 823.70 crore (Rs 612.10 crore).

The major portion of the revenue and profit for HDFC Bank is contributed by retail banking. The private sector bank recently entered the corporate loan and loan syndication business. So far, the bank was concentrating more on disbursing working capital loan.

HDFC Bank has a strong asset quality.

Last month, HDFC Bank sold Rs 200 crore bonds on private placement basis through unsecured non-convertible subordinated perpetual bonds as debentures to augment Tier-I capital.

Source: Capitalmarket

Tyre major JK Industries surged 8.5% to Rs 146, on renewed buying.

Tyre major JK Industries surged 8.5% to Rs 146, on renewed buying. However, the scrip came off a higher level after having jumped 10%, to Rs 147.85, earlier in the day. As many as 5.8 lakh shares changed hands in the counter on BSE. The stock witnessed a solid surge in the past few months. From Rs 72.90 on 24 July, it has risen 100.2% in a short while, to current Rs 146.

A recent sharp fall in rubber price and that of two other main raw materials, carbon black and nylon tyre coat fabric, has triggered renewed buying in sectoral scrips over the past few months, and JK Industries is no exception. Natural rubber constitutes roughly 40% of the total input costs for tyres.

The tyre sector had increased prices in line with an increase in the raw material prices. This was hike was rolled back by some manufacturers following a sharp fall in natural rubber prices.

JK Industries is the second-largest cross-ply (non-radial) truck tyre maker in the country, with a market share in the replacement market at 22%. The market leader Apollo Tyres has 26%. In the passenger car market, JK Industries holds the number two position with a 21% share, while market leader Bridgestone enjoys 23%.

JK Industries recently increased its passenger car capacity in Madhya Pradesh to 3.9 lakh units a month from 2.8 lakh units earlier. To promote motor sports in the country, JK Industries recently launched `formula tyres' for the Indian market.

JK Industries reported 59% fall in net profit for Q3 June 2006, to Rs 3.63 crore (Rs 8.88 crore). Net sales rose 23.9%, to Rs 696.93 crore (Rs 562.67 crore).

After restructuring, JK Industries has become focussed on tyres, and has hived off other investments to a separate undertaking. According to the demerger scheme, which became effective 1 October 2006, the investments have been transferred to a new company.

Source: Capitalmarket

Capita Telepholio Recommends Short Term BUY Call

BUY   : Blue Star at Rs 134
BSE Code  : 500067
NSE Symbol: BLUESTARCO
Market Lot: 1

Blue  Star  is  India's  largest  central  airconditioning  and  commercial refrigeration  company.
Fast-paced growth in organised retail,  hospitality and healthcare sectors holds
sustained growth potential for the company.

Actual adjusted EPS for March 2005   :  Rs  3.9
Actual  adjusted EPS for March  2006 :  Rs  5.4
Projected adjusted EPS for March 2007:  Rs   7.3