This new year, spread joy with prepaid gift cards :: Business Line

A gift card saves your time and energy on choosing gifts and provides your loved ones with the flexibility to decide what to shop for.

It’s time to go easy on work, reflect on the year gone by, and get set to toast a new one. We’re on the heels of the festival season and it’s time to think gifting! So have you zeroed in on the gifts that you’ll shower on your aunts, uncles, cousins and friends?. Finding it a bit difficult?

Consider the prepaid gift card. It marries the benefits of a card and a gift voucher, making it a great idea when you aren’t sure what to gift someone.

I ndia Strategy 3 R (Recovery, Rates, Reforms) vs Positioning 􀂄 BofA Merrill Lynch

I ndia Strategy
3 R (Recovery, Rates, Reforms) vs Positioning
􀂄 Recovery in economy and earnings, rates, reforms drive year-end index target of 21,750
India was one of the worst-performing markets globally last year and expectations were low. But YTD, it has been one of the
best-performing markets globally – with a near 25% return – despite downgrades in the economy and earnings. Unfortunately,
India will enter 2013 as one of the best-performing markets and expectations now are high. We expect the markets in 2013 to
be driven by the 3 R (recovery in earnings and economy, rate cuts and reforms) with the 3Ps (politics, performance and
positioning) acting as headwinds. We expect the market to provide a return of 13% in 2013, in line with earnings growth.
1. Recovery in GDP growth…: We expect GDP growth in FY14 (end-Mar) to recover to 6.5% from 5.5% in FY13, mainly
due to a pick-up in consumption. Nevertheless, we remain cautious on the investment cycle.
2. … and earnings: Like GDP, we see earnings recovering from 7% in FY13 to 12-14% in FY14 (slightly below analyst
numbers). More importantly, the two years of sharp earnings downgrades seem to be behind us.
3. Rate cuts: We expect RBI to cut rates by 100-125 bps as inflation stabilizes and they focus on reviving growth.
4. Reforms and politics: We expect accelerated reforms and high investor expectations until Feb 2013. But with the
current government in a minority, reforms could get tougher in 2H13 as the country gets into “election mode”.
5. Positioning, Supply, could be a drag: While near-term liquidity remains high, flows to secondary markets could ease
over next few months as (a) supply of paper picks up and (b) GEM funds now have their highest weight in India in six
years, and with India already one of the best performers in 2012, the margin for error is low.
Strategy: Prefer rate-sensitive names: Adding Tata Motors, DLF (high beta underperformer)
Our model portfolio, in spite of recent outperformance, continues to favor rate sensitive sectors at least till the budget in Feb,
2013. We overweight rate-sensitive sectors like autos (Maruti, Tata Motors), financials, real estate, telecom and pharma.
Top Buys: DLF, ICICI Bank, Maruti, Lupin
Top Underperforms: HUL, Hero MotoCorp, NTPC
Top Midcap Buys: Havells, Motherson Sumi, Yes Bank, BEL, Glenmark

Sizzling Stocks: Jet Airways, Oracle Financial :: Business Line

 

Raw-sugar poised at key support :: Business Line

Eicher Motors-TP: INR3,850 Buy :: Motilal Oswal

At inflection point
Multiple growth drivers in place
 With several of its projects to commence in CY13-14, driving 28% sales CAGR and 34%
EBITDA CAGR over CY12-15, Eicher Motors (EIM) is at an inflection point.
 Its motorcycle business will benefit from capacity expansion (new plant to start in
1QCY13), new launches (Thunderbird 500 and Café Racer), and network expansion.
 CV subsidiary, Volvo Eicher Commercial Vehicles (VECV), will benefit from the
commencement of the Medium Duty Engine Project (MDEP) and ramp-up in HCVs.
 Buy with a target price of INR3,850, 45% upside over two years. EIM's strong balance
sheet (net cash increasing to INR16.9b by CY15E) limits downside risk, in our view.

Post office savings continue to shrink :: Business Line

Ramp-up of new Range Rover delayed-Tata Motors: MOST

Ramp-up of new Range Rover delayed, but FY13 guidance intact
Cutting EPS estimates and target price; maintain Buy
We met the management of Tata Motors. Key takeaways:
 Ramp-up of new Range Rover (RR) slower than anticipated due to production issues;
expects production ramp-up from December 2012 and maintains FY13 guidance.
 New RR to be accretive at both the EBITDA and PAT level; multiple margin levers exist
in the form of modular platform strategy, captive engine and Chery JV.
 India business outlook challenging (except LCVs) – no catalyst visible in the near future.
 Expects to be zero-debt in the next two years, despite meaningful capex.

Buy DLF- Religare research

Potential improvement in operations not yet priced in
DLF has underperformed the sensex by 20% YoY, primarily led by concerns on high debt, low volumes and non-core issues. But the management now indicates potential improvement in operations led by: a) further reduction in debt on conclusion of Aman resorts/wind mills, b) improved volumes on fresh launches and c) delivery of ~25% of under-construction projects in the next year. These along with likely improvement in macro (including interest rate) starting Q4FY13 should help the stock near-to-mid-term. Maintain BUY.

Hold Petronet LNG - Karvy

Kochi terminal: Challenges ahead to ramp up
We interacted with Gail India, Petronet LNG and officials across the value
chain to evaluate ramp up of Kochi LNG terminal amidst new market of
Kerala, Chennai and Karnataka. Although, the 5 MTPA project is on
schedule to commission fully by Q4FY13, we see many external challenges
to ramp up the terminal optimally. We hope for a repeat of success story in
Dahej Terminal, however with higher LNG price, more difficult terrain,
and relative lower consumer affordability challenges seem to be galore.

SGX Nifty 5,902.00 -17.00; Markets to open down

SGX Nifty 5,902.00 -17.00;
Singapore Exchange
7:40AM India time, Dec 17
Markets to open down

SpiceJet:: De-risking initiatives bearing fruit; best placed to attract FDI ::MoST

De-risking initiatives bearing fruit; best placed to attract FDI
Industry outlook positive; fares up ~20% YTD
We met the management of SpiceJet (SJET), India's second largest low cost carrier (LCC),
having a market share of ~18.5%. Our key takeaways:
 Outlook for the Indian Aviation industry is positive, given (1) sharp moderation in
industry capacity, (2) rational pricing by key players, and (3) recent regulatory measures.
 SJET's de-risking initiatives are bearing fruit, which is reflected in the 31% drop in net
losses in 2QFY13. SJET is poised for a turnaround by FY14.
 Given SJET's industry positioning and strong balance sheet, it would be a prime target
for any international airlines looking to gain a strategic foothold in India, one of the
fastest growing aviation markets in the world.
 SJET trades at an EV of 15x/ 8.5x its consensus FY13E/FY14E EBITDAR. Not Rated