[04:19:48 PM] => Welcome to Live Chat Session : Mr Sunil Singhania will be joining us shortly
[04:19:59 PM] => Disclaimer :
[04:20:50 PM] => Mr. Sunil Singhania is a Director of Advani Share Brokers Pvt. Ltd., having Membership of the BSE, NSE and the OTCEI. At the time of this conversation / chat, Mr. Singhania may or may not have positions in the stocks mentioned below , although holdings may change at any time.
[04:21:07 PM] => The views expressed by Mr. Singhania is based upon information that he considers reliable, but does not represent that it is accurate or complete, and it should not be relied upon as such. Mr. Singhania, his company and its affiliates, officers, directors, partners, and employees may, from time to time, have long or short positions in, buy or sell and deal as principal in the securities, or derivatives thereof, of companies mentioned herein and may take positions inconsistent with the views expressed. None of the information contained herein constitutes, or is intended to constitute a recommendation of any particular security or trading strategy or a determination that any security or trading strategy is suitable for any specific person. To the extent any of the information contained herein may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. You should consult with and rely upon your own advisors whether and how to use such information in making any investment decision.
[04:21:21 PM] => Lastly the views expressed by Mr. Singhania have no bearing whatsoever with that of IRIS Ltd. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website www.myiris.com.
[04:30:49 PM] => Welcome to the Live chat session Mr Singhania
[04:31:33 PM] => Sunita_Rao: What are futures and options? How do they work? Why are they a better option to badla?
[04:32:06 PM] => SS: F&O are instruments useful for hedging, speculation and like any other derivative instruments impart liquidity to the system. F&O trade in separate segments, where risk monitoring and margins are stringent, thus are considered more safe.
[04:32:43 PM] => Vikramassal: Was Badla a Boon or Bane? What do u think
[04:33:30 PM] => Every market needs a speculative or derivative product to impart liquidity. Badla proved to be effective for a long long time. However the misuse of any system ultimately leads to us believe that the system failed. I think badla was very useful as long as it was not misused. The alternative to badla, Futures & Options have also proved to be very useful world over. So surely, we have an effective alternative.
[04:34:22 PM] => Rakah: Which sectors do u believe will do well in the future?
[04:35:11 PM] => SS: India�s strength lies in services. Thus obviously Infotech is going to be the sector to watch out, inspite of recent problems. In the economy sector, cement looks very good and M&A activity should recommence providing a boost to valuations.
[04:36:02 PM] => Dtime: Has SEBI finally got it's "BADLA"
[04:36:27 PM] => SS: SEBI�s decision has not been very consistent. Badla was banned once and later reintroduced. Also SEBI acts only after there is a problem. Its time they started taking decisions with a long time developmental horizon. Until that time all their decisions will look like �Badla�
[04:37:01 PM] => Bsachin: Your view on the FMCG sector- do you expect it to grow more than 4% in the current Fiscal year. Do you also justify the P/E multiple that these stocks command on our bourses
[04:37:38 PM] => SS: The larger FMCG�s like HLL, Cadbury, Britannia, etc continues to struggle. However there are a host of medium size companies, which are not only growing at reasonable rates, but are also available at very attractive valuations. McDowell, Pidilite, Marico and Navneet look exciting.
[04:37:59 PM] => Rishi: Your Market Insight and Foresight make good reading on myiris.com. Oflate I have seen you start Company reports - but only one. Given that Mr. Pashupati Advani and you appear on various TV
[04:38:30 PM] => shows recommending scrips both buy and sell calls why is there not more of Fundamental Research from your side
[04:38:58 PM] => SS: It is nice Rishi that you like our two weekly reports. We believe that shares should be recommended when they are value for money and not because the market is in a bull mode. Mcdowell was one, which looks exciting. Hopefully you should more Company Reports from us.
[04:40:42 PM] => KcSharma: What is Badla?
[04:41:52 PM] => SS: Till Sept 3, 2001, it is a mechanism to carry forward trades on BSE, akin to a derivative product. After that it will be the Hindi meaning of the word �REVENGE�
[04:42:24 PM] => Haresh: Yesterday the Finance Minister talked of moving our Stock Market Systems in line with the rest of the world - why can�t he do that with Govt. expenses and beauracratic controls and endless legislation- your comments
[04:43:01 PM] => SS: We all back you on this. This question should obviously put to all political parties.
[04:45:37 PM] => Jajoo: A 100-year-old system goes up in a puff. Would you rate Badla equal to or worse than Futures & Options?
[04:46:23 PM] => SS: Both Badla and F&O are derivative products involving speculation. LTCM, promoted by the Nobel laureate who invented the most widely used derivative model went bust. Thus every system has to have proper risk management systems in place for it to be safe and effective.
[04:47:05 PM] => Kartikeyan: Was Badla the cause for volatility on the stockmarket?
[04:47:44 PM] => SS: A derivative product usually enhances liquidity and thus reduces volatility. The only concern is that traders tend to overstretch their buying capacities and cause a system failure.
[04:48:15 PM] => Rohit.Gupta: Out of the K 10 scrips, which are the scrips which are fundamentally strong and worth investing with a medium term perspective leaving aside the short term negative factors.
[04:48:33 PM] => SS: Ranbaxy looks very good.
[04:48:58 PM] => Navin202: Do you see volumes picking up in products like derivatives and options
[04:49:31 PM] => SS: The volumes in Index futures did not pick up as speculators were more comfortable trading in individual stocks. Scrip wise options should be very popular when they are introduced.
[04:50:05 PM] => Amitmukheerjee: Will the current market lot for futures & options (min. Rs.2 lacs) affect retail participation in the markets
[04:50:31 PM] => SS: The derivatives segment is meant for investors who understand the segment and for those who have a reasonable net worth due to the speculative nature of the segment. Small investors should buy shares only for investment or better still, invest via Mutual Funds.
[04:50:58 PM] => Theshahs: What would be the impact on markets of the abolition of circuit filters from the stocks?
[04:51:39 PM] => SS: The abolition of filters should make the movements very volatile.
[04:52:34 PM] => Hirens: Would the volumes, which are likely to reduce after ban on badla, would be offset by the options?
[04:53:06 PM] => SS: Initially the volumes will suffer. But as participation increases in F&O, volumes should gradually pick up.
[04:53:56 PM] => Rajshi: Will your firm write options in the regime? And if yes, where will you get the funds to hedge your outstanding options?
[04:55:30 PM] => As clearing members on both the BSE & NSE Derivative segments, Advani Share Brokers can write options. For a sound business house with profitable business, money should not be a problem
[04:55:55 PM] => Ateet: Will HFCL share reach to its previous state?
[04:56:26 PM] => SS: HFCL, though might recover some of its losses, the old levels certainly look like �ATEET�.
[04:56:54 PM] => Mittalajit: What do suggest for US '64 of Unit Trust of India
[04:57:27 PM] => SS: The declining dividends and question mark over its NAV suggest that you would not lose if you surrender your units back to UTI.
[04:57:52 PM] => Vasudev_sd: Should I buy digital equipment now?
[04:58:22 PM] => SS: Digital is an attractive Infotech stock. However, wait for a reaction and enter at around 450 levels.
[04:58:52 PM] => Maseth: What is the future prospective of Reliance Petroleum?
[04:59:07 PM] => SS: The immediate future price trend would depend on the success of its ADR/GDR issue.
[04:59:33 PM] => Sumeet: What is your outlook for the market in the next 3 months?
[05:00:06 PM] => SS: Currently, the market is in consolidation phase. The continuous FII interest in the country and the fact that every negative is being discounted by the market suggests that the market is poised for a take off. However, watch the monsoons closely.
[05:00:38 PM] => Maddanna: How is market trend in near future? How do rate HCL tech shares? How much is the fair value?
[05:01:16 PM] => SS: HCL Tech might be included in the MSCI Index on May 19, 2001. this should be very good for the stock price. As a company it is performing very well
[05:01:48 PM] => Binaya: What is the reason behind Sebi�s decision to ban badla?
[05:02:29 PM] => SS: The sharp fall in the markets led to substantial client and broker defaults. The badla system was misused by certain brokers and this caused SEBI to take this drastic step. The introduction of F&O as an alternative is also a step to move India closer to developed capital market practices.
[05:03:04 PM] => Rameshk: Do you think that the government is right in bailing out US 64 time and again. Do u think Mr.Subramanium's optimism is justified that the markets will look up by Feb 02 and that US 64 will become NAV based?
[05:04:09 PM] => SS: It is bad for the country�s fiscal position. Investors in equity, directly or through MFs should realize that these are risky investments. Bailing out UTI, time and again is not right. As far as Mr Subramanium�s optimism about the market, I as a market intermediary can only pray that it comes true.
[05:04:39 PM] => Manisharma: Do you think IT stocks are still worth buying? What stocks do you suggest?
[05:05:18 PM] => SS: IT stocks have reacted substantially from their peaks. Just as their valuations had become too stretched during the market peak, their prices have come down more than what the fundamentals warrant. Among the larger stocks, Infosys, HCL Tech, Polaris and Hughes look good. However, if you are willing to take some extra risks, invest in second tier stocks, Fujitsu, Geometric Software, Infotech Enterprise's, Moser Baer and Mascot.
[05:05:34 PM] => Padmajakl: Are FIIs gearing up for underwriting options?
[05:05:50 PM] => SS: It is too early to comment.
[05:06:09 PM] => Rohita: Do you think cement and steel and other infrastructure scrips will do well now that the World bank has given huge aid?
[05:06:36 PM] => SS: We are very bullish on cement due to strong demand likely from infrastructure projects. In the steel, TISCO is the only stock worth considering.
[05:06:53 PM] => Amitshah: Do you think there is another crash in the near future and that the bottom is far from over?
[05:07:40 PM] => SS: Though the markets will definitely have its ups and downs, a reaction similar to last years does not look likely. The market currently looks poised to consolidate.
[05:10:05 PM] => vivek_kot : As the stock market leads the nations economy,what does the current stock market fluctuations speaks?
[05:10:56 PM] => SS: Market fluctuations encourage investors as there are opportunities to make money. Effective long term systems and procedures are the need of the hour. An effective capital market is definitely the key to attracting FII flows.
[05:11:41 PM] => navin202 :Can badla be compared to futures or options?
[05:12:07 PM] => SS: Both are derivative products. Both provide liquidity to the cash market and are also speculative tools necessary for an effective cash market.
[05:13:10 PM] => vcr36 : In IBP disinvestment does the prospective buyer need to give a open offer at fair market price
[05:13:38 PM] => SS: The disinvestments of IBP will lead to a change in management and hence an open offer will necessarily have to follow.
[05:14:18 PM] => julie : Your belief on the latest news flash that VSNL strategic sale / disinvestment shall take place by end August - does the Govt. have the political backing to implement the same ?
[05:15:18 PM] => SS: The Govt. is trying its best to hasten disinvestments. The BALCO case proves that the Govt. intends to be firm. Lets all hope that the process is implemented on schedule as future market trend will be dependent to a large extent on disinvestment.
[05:16:06 PM] => vetri : Do clients follow your recommendations and make money ? What in the current market scenario would you mean when you say long term, medium term and short term buys/sells
[05:16:47 PM] => The second question first: Long term in the current fast changing scenario should be over 1 year. Medium term will be 3-12 months and short term less than 3 months.
[05:17:43 PM] => Recommendations are always meant to be attractive money making suggestions. But as long as recommendations outperform the market, clients should be happy.
[05:18:21 PM] => snair : Is the current buying in Sensex based scrips just to build inventory in the hands of the FII so as to enable them to play the game of Futures & Options
[05:19:08 PM] => SS: I do not agree with this thesis. It is too early to make such a statement. Right now, the market does not even know in how many and which stocks option trading will be allowed in.
[05:21:10 PM] => samir_rachh :Why Badla is so unpopular amongst regulators? Was there was problem with Badla or risk management on the part of the stock exchanges?
[05:22:10 PM] => SS: The problem was definitely with risk management and not with badla. Badla proved be an extremely good derivative product. The fact that it was being used only in India might have prompted regulators to search for an alternative. Also options would work better with rolling settlements.
[05:23:05 PM] => sshyamsukha : Has Castrol India announced the buyback at RS. 350
[05:23:33 PM] => SS: SEBI has directed BP Amoco to make the offer at 350 as against 312 proposed. BP Amoco has decided to contest the decision. Thus only time will tell whether the offer will be at 350 or 312.
[05:23:51 PM] => prashah60 : will only the cash rich survive?
[05:24:31 PM] => SS: Speculation without money to back will always be disastrous. For investment obviously, investible funds are required.
[05:25:06 PM] => upendraparihar : Is SEBI decision to ban carry forward trading in the interest of small investors? Can small investors invest in
[05:26:05 PM] => futures and options, if yes, how?
[05:26:29 PM] => SS: I gather you are talking about Vyaj badla where investors could earn interest by deploying funds. In F&O also similar opportunities of earning risk free interest exist, though it might be little complicated.
[05:27:00 PM] => sunita_rao : You haven't answered my question completely. How are F & O better than badla?
[05:27:58 PM] => SS: F&O will ensure that the cash market will be separate from the speculative market.
[05:28:47 PM] => rmundra : Why are we worried about banning badla when option a better product is being introduced.
[05:29:20 PM] => SS: The worry is that there is not enough time for market players to understand a new concept.
[05:30:13 PM] => adolfdsilva : MORGAN STANLEY GROWTH FUND HAS ALWAYS BEEN QUOTED AT DISCOUNT OF OVER 30% TO ITS NAV. AS A FUND MANAGER WOULD�NT IT MAKE SENSE TO BUY BACK ITS OWN UNITS ON A MORE REGULAR BASIS THAN IS DONE NOW WITHOUT OF COURSE ROCKING THE BOAT AND EARN A COOL 30% AND AT THE SAME TIME REDUCE ITS UNMANAGEABLE CORPUS OF FUNDS.
[05:31:18 PM] => SS: For the beneficiaries of the fund, it should be a very good exercise. However the AMC will be a loser because the fees are dependent on the amount of assets managed. Also the fund will have to sell its existing investments to fund the buyback which might depress prices and hence affect the NAV.
[05:33:10 PM] => stanley : Do you believe in the MSCI shit in places like India where home grown operators including SEBI rule?
[05:33:31 PM] => SS: Funds with a total corpus of nearly US$3 trillion follow the MSCI indices. Hence it cannot be ignored.
[05:33:59 PM] => samir_rachh : Your firm I think is bullish on Mcdowell, what are the factors because of which you are bullish, what according to you is the fair value of the company, and if the company is so valuable, why it has fallen so much in the recent past?
[05:34:27 PM] => SS: The company trades at a minuscule market cap to sales ratio of 0.25, when other FMCGs trade at over 5 times. Of course the concern on management quality remains, but as it is said a good stock is one which is priced attractively and not one which boasts of good virtues but is priced expensively. The fall in the price was largely due to funds getting out of momentum stocks.
[05:34:46 PM] => wurz : is it safe to call quits right now?or wait till july 2 for the death penalty?
[05:35:03 PM] => SS: All speculative positions should be squared off as soon as possible. Decent investments, however should yield you decent returns from these levels.
[05:35:27 PM] => chopra12 : what you thing in mnc stock it is worth to buy at this level?
[05:36:12 PM] => SS: MICO among all MNCs looks the most promising. Among other stocks, Gujarat Gas and Atlas Copco are good investments.
[05:37:16 PM] => chandwanimanoj :Good scrips in biotechnology and the future of biotechnology?
[05:37:40 PM] => SS: There are no pure Biotech companies listed in India. Monsanto and Agrevo, among the hybrid agrochemicals/biotech companies are very good.
[05:37:55 PM] => upendraparihar : When will the automobile sector recover?
[05:38:48 PM] => SS: A good monsoon should ensure demand for tractors and two wheelers. The heavy vehicle segment still has problems.
[05:40:50 PM] => rohita : Do you think SEBI is an effective regulator? What are the things that SEBI ought to be doing but isn't.
[05:41:17 PM] => SS: SEBI is till far from being a perfect regulator. However it is young and lately looks determined to move Indian financial markets to global standards. The introduction of demat, for eg was one of the best things that happened to the Indian capital markets.
[05:41:30 PM] => rashesh : if the introduction of NO CIRCUIT FILTERS increase Volatility then why is SEBI introducing that
[05:41:44 PM] => In a rolling settlement, incentives have to be introduced to encourage trading. Circuit filters in rolling settlement will reduce liquidity considerably.
[05:42:28 PM] => SS: In a rolling settlement, incentives have to be introduced to encourage trading. Circuit filters in rolling settlement will reduce liquidity considerably.
[05:43:10 PM] => upendraparihar :Why does BSE have to go public? isn't it just a market?
[05:43:50 PM] => SS: BSE intends to convert itself into a professionally managed corporate with the object of running a stock exchange. The IPO will enable it to raise capital to bring into place the best systems, apart from attracting best managerial talent
[05:44:05 PM] => nikita : can one consider buying Escorts at these levels?
[05:44:38 PM] => SS: The investments in telecom bode well for Escorts. Besides the gain from divestment of its stake in Yamaha will enable it to reduce debt. Good investment at 75 levels.
[05:44:54 PM] => hirak shah : prospects of Jindal Iron & Steel
[05:45:29 PM] => SS: I do not cover the stock, but understand that all is not well.
[05:46:45 PM] => If mutual funds are not for general public what will happen to Advani Sharebrokers?
[05:47:22 PM] => SS: A sharebrokers job is to guide investors properly. As far as Advani Sharebrokers is concerned, our biggest clients are MFs, FIs,FIIs besides a host of reasonably big investors who have the capability taking equity risks.
[05:47:45 PM] => cvsmurty :what is wrong with sterlite optical and why is its price so low?
[05:48:23 PM] => SS: The fall in prices of Optic fibre makers in the US led to a sudden fall. However the co. seems to be doing well fundamentally and your investment is no cause for worry.
[05:48:39 PM] => jdseth : Please describe the mechanism for operation of F&O market. How is it different from the usual stock market?
[05:49:19 PM] => SS: F&O is a derivative market with cash settlement. What it means is that you do not take or give delivery of stocks but only give or take the difference.
[05:49:34 PM] => sachin : What is the basic difference between stock option and badla?
[05:50:28 PM] => SS: Badla is a mechanism to defer your existing position in the regular market. An option is a derived product which gives you an option to buy or sell a pre defined product at a pre determined price on or before a specified date.
[05:51:14 PM] => krans : What would be the impact of down gradation of the India's rating in MSCI
[05:51:33 PM] => SS: As mentioned before, funds worth nearly US$3 trillion incorpus follow the MSCI indices. Thus it is very important. Over a longer term, it definitely has an impact.
[05:52:07 PM] => upendraparihar :Sir,Indian stock market had seen HM scam and now it is KP scam. Don't you think that scams have become a part of Indian stock market?
[05:53:18 PM] => SS: If you see, all scams have been in the banking sector and not the stock markets. Another thing is that the volumes are huge, so obviously the amounts are large and thus stand out
[05:54:28 PM] => kjeetesh : How do you see the market behaving next week? Why?
[05:55:24 PM] => SS: The movement next week will be dependent largely on the outcome of the MSCI meet to decide on composition of their indices. Investors are expecting a 2% cut in India's weightage. A lower cut would be good for the market. Other than this, the market looks like consolidating and should strength.
[05:55:40 PM] => Binaya : How will F & O succeed in a market where badla did not?
[05:56:28 PM] => SS: Badla was definitely a successful product, till it was misused. Every product will be successful only if proper systems are also in place.
[05:56:42 PM] => siddhik :Is it smart to be a speculator or a long term investor?
[05:57:15 PM] => SS: Speculator gives you the thrills, but fruitful investments are usually of longer duration.
[05:57:29 PM] => vnpsarma :u said ibp open offer has to come but at what price.will market price To Rs 1000-1400 expected price of the market
[05:57:49 PM] => SS: The fair value of IBP is anticipated to be anywhere between Rs 400 to Rs 1000. The price at which open offer is made will be the price at which the company is divested.
[05:58:52 PM] => siva_r_subramanian : will options really work in India ?
[06:01:45 PM] => SS: There is no reason why they would not work. Initial hiccups will exist. Of course, along with rolling settlements and options, the market also requires an effective stock lending mechanism and electronic fund transfer.
[06:03:47 PM] => Myiris: hang on friends, Mr Singhania is on a important call :S
[06:07:48 PM] => siva_r_subramanian :is Indian markets are bottomed out ? whether I can get into buy some shares ? if yes, let me know which one I can buy ?
[06:08:48 PM] => SS: The reaction we have seen over the last 15 months have certainly made valuations of a lot of stocks attractive. Our top picks are Mcdowell, Moser Baer, SCI, E-serve Intl, Atlas Copco and MICO
[06:09:12 PM] => lekhapk : Rel petro is this a good buy at current price level ?
[06:09:43 PM] => SS: I think it is fairly valued.
[06:10:36 PM] => Vallabh_in : What�s your out look for tata tele & Zee TV?
[06:11:00 PM] => SS: Tata tele, I do not follow. Zee at Rs 100 is a good medium term investment.
[06:11:30 PM] => Vcr36 : what are prospects of Bathina technologies,intensive air systems and Clio Infotech
[06:12:14 PM] => SS: Frankly, I know very little about these companies.
[06:14:03 PM] => Myiris.com : Dear Friends, Mr Singhania will be answering the last few questions
[06:18:00 PM] => Dineshbanka :Which stock do you like in the following sector for investment horizon of 6-9 months: software /cement/ automobile/ media/PSU
[06:18:55 PM] => Belkar :Which are hot scrips now?
[06:19:08 PM] => SS: Mcdowell
[06:20:28 PM] => Vallabh_in: Sir What�s your out look for a small broker in a longer run, I mean to say after rolling settlement
[06:20:47 PM] => SS: Times will be difficult. A lot of consolidation should happen in the industry
[06:21:32 PM] => Siva_r_subramanian : banned all kind of systems, like ALBM, BLESS, BADLA, etc., don\'t you think this is to avoid the small investor to be there in the
[06:21:46 PM] => SS: It will exactly be the reverse. Small investors buy stocks for delivery and investment. It is usually the operators who use carry forward systems extensively.
[06:24:26 PM] => Sunita_rao : What do you mean when you say your biggest clients are MFs? Do you recommend stocks to them??
[06:24:39 PM] => SS: We are brokers for their sale and purchase of stocks.
[06:24:56 PM] => Gsgulati: What is your view on the current valuation for Hughes software pricing?
[06:25:16 PM] => SS: Hughes Software has bagged new orders from major telecom companies. It is priced attractively at these levels and investment can be considered.
[06:34:22 PM] => myiris.com: Please hold on. Mr Singhania is on a call
[06:34:45 PM] => Siddhik : How long is long? Aren't some stocks good for long term investment while others are for
[06:35:20 PM] => speculation? How do I differentiate between such stocks?
[06:36:08 PM] => SS: Stocks for investment and speculation are the same. The time period for investment is short. While speculating, you over extend yourself and are forced to square up positions even if the timing is not right. Hence speculation tends to be dangerous, even if the stocks in which you speculate are good.
[06:36:55 PM] => Amit.shah : What you think out look for a small brokers?
[06:37:35 PM] => SS: As mentioned before, a lot of consolidation and sharing of resources among small brokers will be needed for them to survive
[06:38:13 PM] => Vennashah :I have read a recent article that brokers are on a desperate lookout for retail clients? Is that true? & how do brokers plan to attract retail especially when they do not have the money to advertise or promote themselves?
[06:38:32 PM] => SS: This is a phase. As soon as markets revive, clients will automatically emerge.
[06:39:15 PM] => SDutt: Mr Singhania, do you think small time brokers like you and us will survive after July 2, 2001
[06:40:23 PM] => SS: The industry will see a lot of consolidation and pooling of resources. New products will also benefit the brokers.
[06:41:08 PM] => Myiris: Thank you Mr Singhania for a very lively and informative chat session.
[06:43:52 PM] => Thank you all the participants and join us for the next chat session on Monday, May 21 with Mr Rajat Jain CIO of IDBI Principal Asset Management Company