>Zee News (ANGEL BROKING)

'Time to tune in'

Zee News (ZNL) is an attractive play on the dual emerging themes of Regionalisation and Digitisation owing to its strong positioning in the lucrative Regional & News Broadcasting space, its proven execution track record and backing by the Zee Group. We believe that steady Viewership gains in new channels and Monetisation of the same coupled with higher Subscription Revenues will drive ZNL’s future Earnings growth. We Initiate Coverage on the stock, with a Buy recommendation and DCF-based Target Price of Rs37.

■ Regional + News = The Right Genre Mix: ZNL's business model clearly has an edge over other Media firms with limited presence in a single genre like News as ZNL offers investors an opportunity to play out a more resilient and diversified theme. Going ahead, weexpect ZNL's Advertising opportunity to register modest 12.3% CAGR in Revenues over FY2008-10E to Rs2,854cr. We also expect ZNL to emerge as one of the key beneficiaries of the upcoming General Elections.

■ Established Bouquet - Set for monetisation: ZNL is a diversified regional player with a strong foothold in all its markets. Its National channels, viz. Zee News and Zee Business have gained significant traction in Viewership while cash cows Zee Marathi and Zee Bangla are maintaining their strong No.1 position. ZNL's strategic foray in the South has also paid off well with Zee Telugu and Zee Kannada performing remarkably, and Zee Tamizh being well on track. Thus, as ZNL monetises its competitive position across markets, it is well poised to clock 23.3% CAGR in Ad Revenues over FY2008-10E.

■ Digitisation to accelerate ZNL's Revenue growth: A strong and diversified Bouquet coupled with advent of Digital Distribution platforms places ZNL in sweet spot in terms of maximising the emerging Subscription opportunity. We expect ZNL to register CAGR of 35.4% in Subscription Revenues over FY2008-10E driven by 77.5% CAGR in DTH Subscription Revenues (owing to DTH rollout) and Monetisation of its Southern Regional channels.

To see full report: ZEE NEWS

>Gold drifts higher, looks for fresh cues (GOLD)

London - Gold drifted higher Monday in a quiet start to the week, as market participants awaited fresh cues for direction.

Dollar weakness and buying by Japanese retail investors helped firm prices, although market participants expected the metal to range trade in the short-term.

At 1033 GMT, spot gold was trading at $952.80 per troy ounce, up 0.15% on the day.

Spot silver was 1% higher at $13.86/oz.

Spot platinum rose 0.7% to $1,120/oz, and spot palladium was up 0.7% at $206/oz.

"We're looking for some new news," said Michael Kempinski, a precious metals trader at Commerzbank in Luxembourg.

Without a strong momentum of its own, gold will likely react to equity markets, the dollar and news stories, traders said.

Key data points for precious metals Monday will be U.S. home sales figures for February and U.S. Treasury Secretary Timothy Geithner's unveiling of a banking plan for toxic assets.

Traders said a rally in stock markets on the back of Geithner's plan may not weigh on gold, even though the plan could instill confidence among investors.

Fears of inflation should pick up any slack from a decline in safe haven demand for gold, said Kempinski.

A London-based trader also said Geithner's plan won't quell investors' worries about the banking industry and financial markets.

"You need to see a real recovery before you see gold (negatively) correlating with equity markets," the trader said.

One sign that safe haven demand for gold remains steady is the recovery in demand for gold exchange-traded funds. Gold holdings in the world's largest gold ETF, SPDR Gold Trust, rose 11.31 metric tons Friday to a record high of 1,114.60 tons.

Traders said they expected gold to trade in a range between $940-$975/oz in the short-term.

Source: COMMODITYCONTROL

>DAILY DERIVATIVES (ICICI Direct)

DERIVATIVE COMMENTS

• With another round of short covering continuing in the Nifty March series, the April futures added 5.71 million shares in OI with the discount almost vanishing. This suggests more long rollovers in Nifty. The rollover in the Nifty till date is 57.74% whereas marketwide rollover is 49.99%

• The options data depicts short covering in 2800, 2900 Call options wherein 2800 Call has seen an unwinding of 15129 contracts whereas the 2900 Call has seen a closure of 19959 contracts. The 2800 Call IV is at 44.57 while that of 2900 has surged from 39 to 44. The 9539 contracts addition in the 3100 Call was accompanied by a rise in IV from 36 to 43. This suggests some Call
buying has happened at this strike price. Unwinding of 15173 contracts in 2800 Put suggests profit booking by Put writers whereas addition of 13831 contracts in 3000 Put along with rise in IV from 36 to 44 indicates some Put buying in the latter half of the session. Moreover, the increasing trend of Put IVs in April series suggests more of Put buying has happened in OTM Puts. We feel the market is likely to take decent support at 2900 on a closing basis in today’s session

• FII index futures added stupendous OI by 13.23% with a net buy of Rs 371 crore

To see full report: DERIVATIVES 250309

>DAILY CALLS (ICICI Direct)

Sensex: We said, "Trading above candle's high of 9455 can test upper end of Green channel ... This could be the short term target/resistance for the Index." Up nearly 3% initially, Index did touch the target, only to find its short-term resistance as argued. Retracing all the gains, it closed flat. Metals lost 3%. A/D ratio ended -ve.

The action formed an up day, but a bear candle with an upper shadow. This indicates hesitation at technical resistance near upper channel and last month's high. But it doesn't indicate breakdown as yet, until we see a strong selling below its low at 9400. Holding 9400 can, therefore, encourage positive efforts, perhaps initially.

TO see full report: CALLS 250309