Shreeji Kosh Services

Equity Estimate for next week

21^st May 2011

Domestic Indices are seen trading up on short covering ahead of May expiry on Thursday but gains could be kept in check due to profit booking. Nifty range could be 5380-5560. Stock specific stock movement will continue to flow in.

Companies that are due to report Jan-Mar earnings next week are Bharat Heavy Electricals, GAIL (India), DLF, Cairn India, Tata Steel, Tata Motors, Reliance Infrastructure and Reliance Power. BHEL and GAIL (India) will take cues from their earnings due Monday.

The downside in upstream companies will be less, were down last week due to government raised their oil subsidy burden for 2010-11 (Apr – Mar).

The Empowered Group of Ministers meet to mull diesel price hike, which is likely to take place next week, will also look forward.

Telecom Sector is expected to face volatility next week with Reliance Communication seen facing selling pressure. Top pick in sector can turn out to be Bharti Airtel which can also act as defensive on fall of market.

Steel Sector is expected to be down next week as stocks are not facing lack of buying interest. “Considering the market conditions, SAIL has reduced its fund rising target to 60 bln rupees from 80 bln rupees earlier," the official had said. Shares of SAIL have fallen about 18% over the last one month. As for other steel companies such as JSW Steel and Bhushan Steel, they are likely to face a shortage in iron ore supply, as on May 13 the Karnataka government had asked miners to halt all mining activities, including transportation of mined material.

Capital Goods Sector is expected to rangebound, focus will be on BHEL as it will post its numbers on Monday. Bhel has been consistenly de – rated in the past four – five quarters owing to concerns like order intake slow down, intensifying competition, limited long term revenue visibility.