All about Sensex!!!!!!!!!!!!!!!!!!!!!!!!

Q.1.What is SENSEX?

The SENSEX is a "Market Capitalization-Weighted" index of 30 stocks on Bombay stock exchange.

Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly known as "BSE". The SENSEX is the benchmark index of the Indian Capital Markets with wide acceptance among individual investors, institutional investors, foreign investors and fund managers. Institutional investors, money managers and small investors all refer to the SENSEX for their specific purposes.

Q.2 How is SENSEX calculated?

SENSEX is calculated using a "Market Capitalization-Weighted" methodology. As per this methodology, the level of index at any point of time reflects the total market value of 30 component stocks relative to a base period. The base period of SENSEX is 1978-79. The actual total market value of the stocks in the Index during the base period has been set equal to an indexed value of 100. This is often indicated by the notation 1978-79=100.

The calculation of SENSEX involves dividing the total market capitalization of 30 companies in the Index by a number called the Index Divisor. The Divisor is the only link to the original base period value of the SENSEX. It keeps the Index comparable over time and is the adjustment point for all Index maintenance adjustments.

During market hours, prices of the index scrips, at which latest trades are executed, are used by the trading system to calculate SENSEX every 15 seconds and disseminated in real time.

Q.3 How is the closing Index calculated?

The closing SENSEX is computed taking the weighted average of all the trades on SENSEX constituents in the last 15 minutes of trading session. If a SENSEX constituent has not traded in the last 15 minutes, the last traded price is taken for computation of the Index closure. If a SENSEX constituent has not traded at all in a day, then its last day's closing price is taken for computation of Index closure. The use of Index Closure Algorithm prevents any intentional manipulation of the closing index value.

Q.4 How are adjustments for Bonus, Rights and newly issued Capital carried out in SENSEX?

I have come across this question many times and did some research to find out how it is done actually. The arithmetic calculation involved in calculating SENSEX is simple, but problem arises when one of the component stocks pays a bonus or issues rights shares. The Index Cell of the Exchange periodically adjusts the base value to take care of such corporate announcements.

Adjustments for Rights Issues:
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When a company, included in the compilation of the index, issues right shares, the market capitalisation of that company is increased by the number of additional shares issued based on the theoretical (ex-right) price. An offsetting or proportionate adjustment is then made to the Base Market Capitalisation (see ' Base Market Capitalisation Adjustment' below).

Adjustments for Bonus Issue:
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When a company, included in the compilation of the index, issues bonus shares, the market capitalisation of that company does not undergo any change. Therefore, there is no change in the Base Market Capitalisation, only the 'number of shares' in the formula is updated.

Other Issues:

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Base Market Capitalisation Adjustment is required when new shares are issued by way of conversion of debentures, mergers, spin-offs etc. or when equity is reduced by way of buy-back of shares, corporate restructuring etc.

Base Market Capitalisation Adjustment:

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The formula for adjusting the Base Market Capitalisation is as follows:

New Base Market Capitalisation = Old Base Market Capitalisation * (New Market Capitalisation/Old Market Capitalisation)

To illustrate, suppose a company issues right shares which increases the market capitalisation of the shares of that company by say, Rs.100 crores. The existing Base Market Capitalisation (Old Base Market Capitalisation), say, is Rs.450 crores and the aggregate market capitalisation of all the shares included in the index before the right issue is made is, say Rs.4781 crores. The "New Base Market Capitalisation " will then be = 450 X (4781+100)/4781

This new figure will be used as the Base Market Capitalisation for calculating the index number from then onwards till the next base change becomes necessary.

Rico Auto geared up to take advantage of auto ancillaries boom.

The business model of the Gurgaon based company caters to Automotive and service segments. The automotive segments have three products namely Aluminum Foundry, Ferrous Foundry, Dies and Mould. Service segments deals in BPO and Engineering Services. RICO’s BPM division enables companies to generate value for their customers and employees through the application of its customer & employee-care services and Engineering Services division focuses on CAD, CAM, CAE, tool & product design.
There is a big amount of external demand coming in because lot of big OEMs worldwide are trying to save cost, so lot of that is likely to result into outsourcing of auto ancillaries to countries like India. India is quite geared up to become the next hub for manufacturing auto ancillaries as well as small cars.The good thing about Rico auto is that they are very well geared to take advantage of this coming boom. They have a very clear action plan to take advantage of this and a very good well managed company, with a very good focus on their products.
They also have lot of technical alliances already in place. Rico Auto Industries Limited & Continental Automotive Systems have decided to set up a Joint Venture Company to Manufacture Hydraulic Brake Systems in India. In this joint venture, it is having arrangement of preferred supplier of cast/machined components to the JV Company. In addition, the company has also FCC RICO Limited a 50-50 joint venture with FCC company of Japan, the world leader in two wheeler clutches, automobile clutches and fly wheel.


On 12-Jul-2007, prudential Icici Amc Ltd A/c Emerging Star Fund bought 3000000 shares of Rico auto @ 45.49.The mutual fund companies are taking keen interest in the stock. Refer below link for holding detail:
http://www.ricoauto.com/sharepattern-31march06.htm


CMP 42.5
Target1 51.90
Target2 57
52 week high: 88.95 (29.9.2006) 52 week low: 38.00 (8.6.2007)


It had touched an intraday high of 47.10 on 20th July. This is a stock which looks very attractive at current prices and deserves investment and becomes a case of strong buy on every decline. It is a very good point to enter for a long term investor because in two years time this has a potential to be a multi-bagger from here.

stocks for today

stocks for today:

Paradyne Infotech CMP 182 target 191
Bliss GVS Pharma CMP 121.85 target 127
Pritish Nandy Communications CMP 108 Target 113.80

all these 3 stocks should hit the upper circuit today.
happy trading:)

Demand for power transmission and distribution is booming..

Fundamental call for medium/long term.

Areva T&D India Ltd is one of the leading T&D Companies of the world. The Products vertical of the Company contributes substantially to its total Indian business and has a broad range of offerings in both the high voltage and the medium voltage segment.

With the recent acquisition of RITZ High Voltage instrument transformers activities and Passoni & Villa, it is a worldwide leader in this field and holds the number one market position in the United States, Germany and Brazil. With over 50 years of operating experience in the country, Areva T&D India contributes to around 9 percent to the overall order intake of its parent Company.

The Company reported a 75% growth in its operating profit for the quarter ended March 31, 2007. Areva is having a large order book from compnies like RPL, NALCO, GECOL etc. Recently, Madhya Pradesh Power Transmission Company Ltd (MPPTCL) — transmission and distribution electricity utility of Madhya Pradesh has awarded a contract to Areva T&D for 22 x 160 MVA 220/132/33 KV autotransformers and 4 x 100 MVA 220/33/33 kV two winding transformers, including transport and supervision of erection and commissioning. Totaling over Rs 115 crore, this is a big product package order for the Company to date.

Reinstating its strategic importance in the competing Indian SEZs market, Areva has further announced establishment of a new power transformer factories at Hosur, Tamil Nadu and Vadodara, Gujarat.

Company has been an outperformer in the market with its aggressive plans. Even today when all the stocks are down areva has kept its head up.

Igarashi Motors India profit rises 197.40% in the Mar 07

Sales rise 28.29% to Rs 62.45 crore

Net profit of Igarashi Motors India rose 197.40% to Rs 2.29 crore in the quarter ended March 2007 as against Rs 0.77 crore during the previous quarter ended March 2006. Sales rose 28.29% to Rs 62.45 crore in the quarter ended March 2007 as against Rs 48.68 crore during the previous quarter ended March 2006.
For the full year, net profit rose 428.70% to Rs 6.08 crore in the year ended March 2007 as against Rs 1.15 crore during the previous year ended March 2006. Sales rose 40.13% to Rs 245.63 crore in the year ended March 2007 as against Rs 175.29 crore during the previous year ended March 2006.

Source http://www.capitalmarket.com/Cmedit/story7-20.asp?SNo=171580

CMP 94.75
Target1 103 , Target2 118.50
Buy with SL of 89.

Arvind mills

Arvind mills has 750 acres of prime land and on valuations alone it is estimated at 4000 crores.
seen accumulation with high volumes today.
CMP 46
can reach level of 54-57 in near term.

Subhash Projects & Marketing Ltd

CMP 245.60
Target 280 (3 days)

Company has bagged order worth Rs 267 Crores from PHED, Jodhpur, Rajasthan for Works related to Supply of Water from Jawai & Hemawas Dams (Pali District) to Pali town and on route Water Treatment Plants on Single Responsibility basis turnkey job contract, including necessary design and operation & maintenance.

Also city Group planning to buy 25% stake in company.
Go grab it.