Uncle Jam pumps up buying spree

Traders enjoying the roller coaster ride at the Balaji Telefilms counter were in for a rude shock as stock exchange authorities decided to act tough with punters.

Speculators may cry hoarse about excessive interference, but if a company trades its entire share capital every second day, there is no way concerned authorities can turn a blind eye. Meanwhile, Small Daddy is reported to have offloaded close to a lakh shares at the counter, joining ranks with the Savvy Fund Manager who has managed to book profits over the past few days amidst the melee.

Ask James Bond has come out with a buy recommendation of the scrip, impressed by the latest quarterly performance. According to Bond, given the volatility in the media business, earnings predictability is limited. However, Balaji Telefilms’ earnings predictability is far superior than most of its peers as it operates mainly on fixed-price contracts.Bond believes that the business of content production is far from mature and hence Balaji has tremendous opportunity for growth.

Hard sell
Even as cement stocks are battling monsoon blues, they seem to have found a cheerleader in Uncle Jam. The volumes story may not be convincing, but Jam is of the view that the price increases will sustain and that is what will eventually drive profits.

That apart, the house feels the national highway programme is progressing at a fairly good pace and post monsoon, quake rebuilding activity will gather momentum. Jam’s top picks in the sector include ACC and Gujarat Ambuja, both of which have been accorded an outperformer ranking.

Meanwhile, the Peace (Mrs KI) brokerage has reiterated its buy call with on Sterlite Optical with an outperformer rating, which has lost some amount of fancy with fund managers. According to a note circulated by Peace to its clients, the company has bagged a shade lower than half the BSNL tender volume, as compared to the previous round where it had bagged a shade over the 50 per cent mark.

However Peace feels the company can still benefit by supplying raw fibre to smaller companies which have procured a minor portion of the orders, but do not have their own optic fibre capacities. That apart, the price realisations from the tender (at $40/fkm for raw fibre and $85/fkm for cabled fibre) are much better than what Peace had hoped for, as per the note.

Trivia
Close to a lakh of shares are reported to have been picked up at the Infosys counter with Uncle Jam reported to be one of the prominent executors on the buy side. Cane Bank Off Shore and the Mereel Fund are reported to be buyers at the Wipro counter even as Coat Hari Mutual Fund has been booking profits over the past few trading sessions. Meanwhile, Coat Hari and Cane Bank are reported to have helped prices stabilise at the HCL Tech counter through their purchases at lower levels.

Santosh Nair
santoshnair@myiris.com