GE,

Yields on French 5 to 15 year fixed-rate bonds rose but investor appetite remained firm despite concerns about Spanish debt

http://www.reuters.com/article/2012/04/05/france-bonds-idUSL6E8F51ZZ20120405

Spanish borrowing costs jumped at bond auctions on Wednesday, spreading fear in European markets of a return of the euro zone debt crisis and overshadowing a successful step back into debt markets by neighbouring Portugal.

http://uk.reuters.com/article/2012/04/05/uk-spain-bonds-idUKBRE8330CV20120405

Hi Gitanjali, Wish you the same.. Happy Mahavir Jayanti

Hi ham, thanks for the updates.

Hello CB/ Kartik,

What is your view on viceroy hotel,
Jhunjhunwala has suddenly taken lot of stakes in it.

Sohan

United Spirits

Angel Broking, a stock broker and equity research firm has come out with a stock research report on United Spirits. Interestingly, the report talks about United Spirit's being benefitted in case Kingfisher Airline's goes bankrupt! Read on..

KFA’s bankruptcy will lead to better price discovery for USL:
United Spirits (USL) is promoted by United Breweries Holding (UBH, 28%), which is also the promoter of Kingfisher Airlines (KFA). According to UBH’s FY2011 Annual Report, the company has given guarantees worth `9,135cr on behalf of Kingfisher Airlines (KFA). If KFA goes bankrupt, UBH will have to repay KFA’s debt and other liabilities (which are guaranteed by UBH), which can only happen if UBH offloads its stake in United Breweries Ltd. (UBL), USL or sell its other fixed assets or subsidiaries. If UBH plans to offload its stake in USL, we believe it would lead to better price discovery for USL, as it is presently trading at its historically low valuations and the stake sale would be at a premium. In the past also, companies have been known to pay huge premium to buy majority stakes in such companies, thereby leading to a significant increase in stock prices in a short period of time.

Problems with KFA not to affect USL’s fundamentals:
Although USL and KFA have the same promoter, they are involved in different businesses that are not interconnected in any way. We believe USL’s stocks have overreacted to all the negative news of KFA, although its business has continued to show strong growth overall. USL achieved the tag of the world’s largest spirit company in volumes at the end of FY2011, and it is expected to maintain this position in FY2012 also. However, the company has recently been facing concerns regarding its mounting debt and is trying to raise US$225 through FCCB issue, which will help it to reduce its interest cost over the coming quarters. The money raised will be partially utilized to repay debts, which will bring down USL’s interest cost and lead to lower cash outflow.

Valuations too attractive to be ignored:
The negative news of KFA led to a significant decline in USL’s stock price. However, we believe the impact of KFA’s performance has already been reflected in USL’s stock price, and USL is now expected to get re-rated going ahead, based solely on its fundamental performance. We estimate USL’s revenue to witness a 11.5% CAGR and net profit to post a 22.1% CAGR over FY2012-14E. At the CMP, the stock trades at only 15.0x FY2013E and 12.3x FY2014E earnings. We believe the stock valuations are quite attractive and, thus, recommend to buy stocks of Unites Spirits with a target stock price of Rs.884, valuing the stock at 17x FY14 EPS of Rs.52.

Hi Sohan, Happy Mahavir Jayanti . technically its in a downtrend. not sure of entering it yet

Hi CA.Tejas, thanks for the updates.

Hi CA.Tejas, yes, it does look strong. one can enter it.

GA CB,

India's imports of gold and silver tumble in Q1 – Casey Research

http://www.caseyresearch.com/gsd/edition/indias-imports-gold-and-silver-tumble-q1

Spain Jolts Euro Zone Back on Alert

http://www.nytimes.com/2012/04/05/business/global/european-central-bank-leaves-interest-rates-unchanged.html?_r=2

Euro Zone Heading for Another Hot Summer

http://online.wsj.com/article/SB10001424052702304072004577325530392434726.html

Japanese Stock Drop as Europe Debt Crisis Concern Flares

http://www.bloomberg.com/news/2012-04-05/japanese-stock-drop-as-europe-debt-crisis-concern-flares.html

Hi Uniyal, it does look good. can see 19.60

Hi ham, thanks for the links

Hi CA.Tejas, yes, you should get the dividend..