INFY Buyback anatomy

Detailed analysis of the buyback

Total no. Of shares is 230 Cr. Shares. So, the current market capitalization is 230 Cr. x current market price (923)

Infosys is buying back shares worth 13000 Cr at a price of 1150.

So, the number of shares it'll buy back is 13000 Cr./1150
Which is around 11.3 Cr. Shares

The allocation for retail Investors from this 11.3 Cr. Shares is 15%, coming around 1.7 Cr. Shares.

Let me tell who are all retail investors. Whoever is holding shares worth 2 lakhs or less.

Now, let's find out how many shares are held by them, this comes around 2.87 Cr. Shares

Infosys buys back maximum 1.7 cr. Shares from available 2.87 Cr. Shares

So, if everyone participates in the buyback, company will equally buy shares from everyone at a ratio of 1.87/2.87, which is 59.2%. This is called acceptance ratio.

So, if we have 2L worth of shares ( which comes around 200000/923= 216 shares), you can estimate how many shares that Infosys will buy back from you, as below:

1. If everyone is participating,
Acceptance ratio is your number of shares that infy will buy back, which is 216*0.592, coming around 128. This is the worst case.

2. For Infosys to buyback all shares(216) that you have, there must be offer <= 1.7 crores

Strategy to follow:
     Let's take the worst case scenario. 216 shares we hold, and infy will buy back 128 shares. So, after buyback we'll still have 88 shares. To avoid the risk of these shares going down in price, we can either short futures or buy PUT option.

DRL - an Interesting proposal on a high tide

My calculations are based on last 6 months moving trend of Dr. Reddy's and the recent news.

It has gone down below the 200 day moving average of 2800. And the news is that FDA has served 13 notices on inspecting it's production units in Srikakulam. Turned out that the notice wasn't that severe. FDA has asked just for an explanation of certain irregularities in the production.

The market reaction went bad as it coincides with the 200 day moving low.

I see a strong support @2600+ levels, if at all it goes there.

I still hold the target of 3200+ by next quarter

Other than that I don't see any major hiccups.

Flood relief work in chidambaram

Pradeep and Gang did a great job. Happy to join them.

We were able to narrow down some villages in and around chidambaram that still need some relief work.

Some snapshots

Sit on the fence...???..Still doing it?

Ruble did provide an opportunity! I really suspect the discussion that Modiji and Putin had! Felt great about following the most coveted virtue - Patience! Last week was a wild one! When the market was down the second day, everyone said every stock is undervalued... :) I really doubt those so called analysts. Anyhow, some are really mouthwatering, some are tempting but not yet ready to jump in, based on last week's wild run.

Mouth watering - Anant Raj, Escorts
Tempting, but you may feel acidic for sometime - Unitech ( Enter below 15), Firstsource, NOCIL
staple - Motherson Sumi, SBI

Tired??

Too many double tops in the past month, but the post consolidation of second top is dragging.
Below are post double tops

1. ONGC - Already languishing around the support level of 365. If it goes below with big volumes, enjoy the downfall! Go short at any price above 370+. Hmm, for investors....Keep a watch on any positive news and Sell. It is not even holding on to the news for a day. You can always enter at a lower price, if you go purely on chart patterns.

2. Motherson Sumi - Huge Potential, but the chart offers a lot of shorting options. The mood is weakening. Has come down a little from the second top. Cautious ones can clear the counter.

There is one probable long cup and handle :) crompton Greaves...Can clearly go long. I am waiting for a breakout.

Trading Opp.
Patel Engineering - Strong support at early hundreds. Can enter at any price below 108.

Playing it My Way

Probably his legal advisers would have asked him not to say much on match fixing that brought Indian Cricket to its knees..., and there were some other issues that Sachin did not dig deep into. He could have exposed everything, but with a look at his current stature that he being a dignified member of the Upper House and adopting a Village, he has more to do. Like his Father said to him "I'd like you to be remembered as a better Human than a better Cricketer". The Book is so simple and smooth that I could get the real meaning without any assumptions, and so bland that I slept when I was half way through the Book :p
The book is a playback of all his important innings. The early cricketing days were interesting. Sachin claims that he's a naughty kid with some illustrations :) Well, we don't consider those as naughty and those are pretty boring..He should have grown with us (he he). I thought Kambli and he were thick friends during the early days, and expected a lot, considering the rapo of Kambli. He got only two or three pages, alas!
His own version of Sharjah ODIs was surprising. He ducked behind Gilly so that we won't be swept by the sandstorm, while the cricketing world depicted him as a crusader standing tall in the storm and winning the match. Sure he was a crusader in Sharjah, but that's really a good one :).
I was able to latch on till the epic innings by VVS and Rahul, but skipped lot of pages and read only those that meant a lot to him.
A Bible for his fans, and a good book on a collector's shelf, and a good first half and final read.

Rosy Days

It's always and its consistent, that even a most pessimistic cautious investor would throw his guards away and jump into the pool. Analysts call it a multi-year Bull run. I've tried my best to go contra, but :(. So, I am sailing the tide.
Here are some winners this Quarter, which means they have more steam left.
NOCIL
Texmo pipes
Bayer cropscience
India Gelatine
Motherson Sumi ( So many Fund managers are behind it. May give a second thought in another 2 Qs. As of now, it is pretty strong and good, though the it is struggling to cross the resistance level of 440)

Some party Bloopers(who knows.. results are yet to come for some)
Unitech
suzlon
Crompton Greaves ( Have sought Shareholders' vote for 100% FII, may rise a bit. Exit on every rise)
ONGC