HAPPY NEW YEAR 2010

Hello

Wish you and your family a very happy and prosperous new year.

May the New Year bring you love, happiness and success!!

Regards,

Amit.

Movie Review - PAA

Paa is a rare film..

Starring Amitabh Bachchan, Abhishek Bachchan, Vidya Balan
Written & Directed by R Balakrishnan
Rating: ***** ( Out Standing )

HATS OFF TO BIG B.

YAHOO UB TGT ACHIEVED !!!!!!!!!!!!!!!!!!

YAHOO !!!!!!!!!!!!!!!!!!!

TARGET ACHIEVED IN 10 DAY

NEAR BY Rs.52 UP !!!!!!!!!!!!

BUY CALL GIVEN ON 27 NOV 2009 AT Rs.148

On 07 DEC 2009 TGT ACHIEVED Rs.200

STILL BULLISH ON UB SHORT TERM TGT.250

LONG TERM TGT 400

BUYYYYYYYYYYYY!!!!!!!!!!!!!!

ENJOY!!!!!!!!!!!!!!!!!

Godrej Properties — IPO: Avoid

Godrej Properties — IPO: Avoid

Investors can currently refrain from the initial public offer of Godrej Properties. At the offer price, the stock would trade at 33-36 times its expected sustainable per share earnings for FY-10 on an expanded equity base.

Mumbai-based realty player, Godrej Properties, follows a joint-development strategy which is not reliant on holding a large land bank. It could turn out to be among the model strategies for the real-estate industry, with a lean structure that does not lock into land cost . The structure has, however, not entirely protected the company from the vagaries of the real-estate cycles; this company too has been hit by the slowdown and has been confronted with a decline in sales, profitability and higher debt over the last year.

With limited projects slotted for completion over the next one-two years, the offer price band of Rs 490-530 does appears a tad expensive for retail investors. The company may warrant a re-look on any sharp stock price declines or on improved scale of operations. Though such valuations are accorded to large players such as DLF and Unitech, Godrej Properties may not be strictly comparable, due to a much smaller revenue base and less diversified operations. Stocks of mid-sized realty companies (a segment in which Godrej Properties can be classified) trade at a good discount to the larger ones.

Background

Godrej Properties is a subsidiary of Godrej Industries. The company has so far completed 23 projects, selling about 3.2 million square feet of residential and commercial property, mostly in Mumbai and its adjoining cities. It currently holds an estimated saleable area of 50 million sq. ft, of which only about 4 per cent is from its own land reserve.

The company plans to raise about Rs 500 crore through this public offer, a good part of which would be used to acquire development rights for its forthcoming projects (which account for 36 per cent of the 50 million sq. ft of saleable area) as well as for repayment of loans.

Joint development

About 77 per cent of the area to be sold by Godrej Properties comes under the joint development model. This model involves entering into development agreements with the owners of land who are typically entitled to a share in the developed property or revenues/profits arising from the same or a combination of the two. This model has the advantage of avoiding direct land dealings for the realty developer and locking up extensive capital in land, leaving funds to meet working capital . On the flip side, purchasing development rights is not cheap especially in cities such as Mumbai. Besides, low-cost land bank accumulated years ago, has enabled bigger players such as DLF to earn superior profit margins. Holding land parcels has also allowed a number of developers to sell plots to tide over the fund crunch and meet their construction costs on other ongoing projects. Further, even as revenues would have to be shared in the joint development model, the entire construction cost would have to be borne by the developer.

Source : http://www.thehindubusinessline.com/iw/2009/12/06/stories/2009120651571100.htm