>RELIANCE INDUSTRIES LIMITED: Time for a relook, we see 24% upside from current levels

RIL has underperformed the Sensex by 19% since April of this year, which the steepest
underperformance in the stock over the last six years. The under performance has been driven by i) KG D6 production stalling at ~60 mmscmd, ii) uncertainty around refining and petrochemical margins and iii) RIL’s foray into telecom and hotels. We believe however, that the bad news around the stock has been more than priced in and the stock should rally smartly from here, aided particularly by good news on the gas pricing front (overall domestic gas prices rising) and exploration business globally (more shale acquisitions).

■ Refining and Petrochemical pressures now fully reflected
The cyclical downturn in refining and petrochemical demand, coupled with the simultaneous record increase in capacity worldwide has led to one of the most severe slump in margins for a long time. However we believe that the last few months have shown signs of a substantial turnaround, with Singapore benchmarks rising and the improvement in Arab Heavy Light Spreads. The closures of unviable standalone refineries in Europe should further help the demand supply balance going forward (~1.5 mb/d of capacity shut in over the last few months)

To read the fulll report: RIL

>BILCARE LIMITED (ANAND RATHI)

■ Investment Theme Innovation driven by R&D is key driver for the growth of all the business segments of this company.The major contributor is and will remain the Pharma packaging solutions, which accounts for 85% of sales

■ Company offers comprehensive range of innovative packaging solutions, consisting of – blister films, aluminumfoils, cold formed blisters and wrap systems.

■ Apart form domestic demand, major growth will come from US markets, where shifting from bottles to Blister packaging will boost demand for its products.

■ Company is ready to tap this potential with required DMF filings and FDA approvals. Another important growth area will be – Global Clinical services business. Here company is offering various services in clinical trials phase to cut costs as well as time period, with its innovative products & services.

■ Company caters to 35‐40 global clients for 60‐70 drugs in various stages of clinical trails and these numbers are likely to grow significantly in coming years. This will be the fastest growing segment with highest margins.

■ Company has developed anti counterfeit solutionsin packaging using non clonable security technology (NST)which can revolutionize the packaging arena,by offering solutions across number of industries to ward of the menace of piracy.

■ Company’s recent US acquisition is earnings accretive and drive the top line and bottom line significantly.

We think stock is highly undervalued and deserves re‐rating. Market is not giving any valuation to this company for its strong R&D capabilities and unique patented technologies. Acquisition led inorganic growth is yet to be discounted. BUY with target of Rs 950/‐ in 12 months.

To read the full report: BILCARE LTD

>INFRA BEESInfrastructure Benchmark Exchange Traded Scheme

Investment Objective
The investment objective of the Scheme is to provide returns that, before expenses, closely
correspond to the total returns of the securities as represented by the CNX Infrastructure
Index by investing in the securities in the same proportion as in the Index.

However, the performance of Scheme may differ from that of the Underlying Index due to
tracking error. There can be no assurance or guarantee that the investment objective of the
Scheme will be achieved.

Investment Pattern
Upto 100% of net assets in Securities covered by the S&P CNX Nifty Index; Upto 10% of net assets in Money Market instruments, convertible bonds & other securities including cash at call but excluding subscription & redemption Cash Flow

An Open-ended, exchange listed, Index Scheme

Terms of Issue
On NSE, the units of Nifty BeES can be purchased/sold in minimum lot of 1unit and in multiples
thereof. Directly with the Fund - The minimum number of units of Nifty BeES that investors can
create/redeem in exchange of Portfolio Deposit and cash component is 10,000 units and in multiples thereof.

Load Structure:
Entry Load : Nil
Exit Load: Nil

To read the full report: INFRA BEES

>RELIANCE CAPITAL: Q1 FY 11 result performance

During the quarter ended June 2010 reliance Capital posted a consolidated total Income of Rs 12.6 billion which was down by 13.7% on Y –o- Y basis and down by 26% on Q –o- Q basis. The total income was down due to lower capital gains and reduction in topline of general insurance business. The company posted a net profit of Rs 770 million which is drastically down by 49% on Y –o- Y basis but is up by 19.4% on Q –o- Q basis. The profit was down due to fall in AUM and loss in insurance business.

Strong contender for banking licence
Reliance capital is interested in banking license for quite some time. The finance minister in the budget has announced to give new banking licence. Reliance capital is currently a key contender for the banking license, as it will be source of low cost funds which is key requirement for the growth of business.

Strengthening broking business
Reliance capital's subsidiary 'Reliance securities' is looking to increase its employees strength to 1,400 from 800 at present, the company is also targeting to reach 10,000 franchisees in next 2 years. The company having a customer base of 6,50,000 is planning to invest around Rs 30 to Rs 40 billion in coming 2 to 3 years to improve technology and risk management capabilities, and to introduce new retail equity products, the entire spending would come from internal accruals.

India’s Largest mutual Fund
Reliance mutual fund is currently the India’s largest Mutual fund with 15% market share. Reliance Capital Asset management currently manages Rs 1.4 trillion across MF, Pension funds, managed accounts and hedge funds.

Valuation
We have done a SOTP based valuation for the company and valued the various business segment of the company on different parameters. We arrive at target price of Rs 868 for reliance capital. At current market price the stock is trading at 2.61x its FY 10 book value and at our target price it will trade at P/B multiple of 2.8x.

We recommend BUY with investment horizon of 6 to 12 months.

To read the full report: RELIANCE CAPITAL