Delhi/NCR is a weird place that way - lot of black money, and very good roads/infrastructure. Still, there is enormous amount of housing becoming available and literally everything hinges on Diwali. With interest rates staying high, Unitech is bound to suffer - at least as much as the others. Brigade and Sobha have suffered hugely - P/Es are now down to 10 or so - and DLF is also valued at a lower P/E. Yet, I believe these companies tend to overstate earnings, which will only take them so far.
So, another short. Future traded last at 167.7, and the lot size is 900, for which I can short three lots with a 10% exposure.
The spreadsheet is now open for view.
Ignore the small profit on ICICI - it's too early to gloat. Note also that I don't have price targets. I don't have a "system" way to trade this. In fact I have no real positions on it in my personal account, because I only trade systems nowadays.
And as usual, disclosure: No positions, but I could have any position, even the reverse (long), because I trade only what my computer throws out. This "strategy" is not meant to be advice and is purely educational.
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>hi Deepak!
i really enjoy reading your blog which is so full of fundamental data. i clearly remember your warning about ICICI Bank on their last quarter results and what was to come. struggling to go past 700 now.
thanks & cheers
mvp
08.18.08 at 8:13 PM
>hello,
i am quite suparised that you are comparing Unitech on PE basis shouldn’t unitech be taken on NAV basis…….as it is till pure land bank play………..it’s telecom foray is yet start.
08.18.08 at 11:10 PM
>Deepak, I agree with ur reasoning for shorting unitech. I guess if RBI goes for another interest rate hike before Diwali, it,ll be free fall for realty and banking stocks so in general the scene for these sectors are not good and you have picked the weakest ones or the ones which will take the max hit. Your calls are more fundamental short rather than technical short… so what abt exits?
08.19.08 at 3:02 PM
>chimak: I believe in EPS growth and P/E – all other fundas like land bank don’t make sense to me.
Rajiv: Exits are goign to be called here. I’ll post the exit trades as well, but right now there are no targets. Perhaps when teh turnaround is in sight or if they get oversold.
08.19.08 at 5:35 PM