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Posts Tagged ‘Suzlon Stock’

NIFTY falls below 4400

Monday, August 17, 2009 2 comments

This has become a nightmare for short term traders. One day down, next day up and down again . It is important to trade light because this choppiness can inflict serious damage to your trading portfolio.

The bulls had showed some promise last week by attemting to cross 4700 again but today’s sudden attack by the bears changes the game again .Thats what I like about markets- they never let you be complacent. I had to exit the longs on the opening and take the loss. Learning to accept that you are wrong is the hardest part of trading! Last week people might be thinking of 5000 and now they are thinking of 4000 again!

The prime reason for today’s correction was the meltdown in Chinese market. They were the first to give bullish signs in the current uptrend and now perhaps they are giving the first signals of a trend reversal.

This huge volatility is not good for the Indian market.This might be a signal that many bulls are offloading their stocks at higher level. With today’s sharp correction, bulls might not be able to hold 4380 and 4350 on the downside. The bears might even short more once these levels are broken. Which means that we are again looking at 4250 levels (back to the point from where we started).

Till now the medium term uptrend is up but if such sharp corrections continue for another week or so, even medium term bulls might offload their positions and turn bearish. This is definitely not the time to be aggressive.

Stock specific, I’d keep an eye on stocks that remain in long term uptrend. Even in today’s market, a stock like Aptech was holding well . Such stocks are good for accumulation on dips. Midcap IT and Pharma look relatively better. Auto stocks are also ok but very volatile, so trying to trade them is very risky.

Speculative stocks like RNRL, Suzlon,DLF might be risky at this point of time. One can pick them only if markets find support around 4250 levels.If markets bounce from there, these stocks might bounce sharply. At the same time, if markets correct, a stock like Suzlon might even touch 60-65.

Buy or Sell -Suzlon Energy

Sunday, August 2, 2009 11 comments

Suzlon was once the darling of the bull market but had come crashing down in 2008.The company posted quarterly results yesterday and had a net loss.

The problem with Suzlon is the high debt it used to fuel its growth. That went well till the cost of debt was low and the global growth in Wind energy was good. As soon as the growth slowed and the cost of debt became to rise, it was double trouble for Suzlon. That’s what happens when companies aim for exponential growth path based on cheap debt.

My sense is that it will take for the company to get out of this mess. As most of its business is global, the global growth needs to return to 2006-2007 levels before the company can sell its pretty wind farms. Also company needs to do a lot of work on its receivables as they have really ballooned.Working capital managment has become a real challenge for the company.

Coming to the stock price, the stock is a sell on rallies kind of stock. The stock can pick some momentum only after it crosses 125 levels. On the downside, 80 is the critical level to watch, below which, the stock can fall very badly. The stock can be a good short sell candidate after that.

This is a big lesson for investors- Not everything that goes down comes up. Use this rally to get out of bad apples in your portfolio.

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TITAN moves up, SUZLON breaks out

Wednesday, June 27, 2007 Leave a comment

An interesting observation- JP Morgan downgraded TITAN yesterday and the stock has shot up again!

Suzlon Energy has breezed past its all time high of 1510.