Pick details

This pick was posted on: Friday by MoneyVidya.com member ‘Vicky’. The price of the scrip when this was posted was Rs. 44.5 and the latest price is 49.10 - indicating a gain of over 10%. The timeframe of this pick is 2 years. Vicky has indicated a target price of Rs. 80 and a stop loss of Rs. 20.

Analysis (Verbatim):

I think that as terrorism rises, people are going to become more insecure and paranoid. With the most recent (and ongoing) terror attacks in Mumbai - possibly the worst that India has ever seen - and the relatively poor handling of the same by government agencies / national security forces, people are going to increasingly take security and safety into their own hands.

The other thing that is quite different about these attacks is that they have struck the hearts and minds of the more affluent classes of Mumbai and indeed the rest of India. As a result, I think that Zicom’s ability to sell its security systems, not only to Corporate offices Read the rest of this entry »

While the market has rallied considerably since Diwali, with the Fed cutting rates to 1% and the RBI slashing repo, CRR, and SLR, the Nifty is trading at a PE of 13.76. This is by no means cheap, but considerably below historical PE levels of 17.83. 

Monday last week saw the Nifty touching its lowest PE level since Jan 99 at 10.68, with the market closing at 2524. My guess is that ‘around now’ is a great time to invest, but not exactly now. I have a feeling that the 600+ point rally that we’ve seen is just a relief rally, and once participants start profit booking, the over-reaction to the positive measure subside, and as earnings continue to disappoint, we’ll soon be back in the 9000 region. When that happens, make sure you’re ready with your money, and clear on where you want to put it!

Historical PE Chart - NSE Nifty

Source: NSEIndia.com