RESPONSE TO READER'S QUERY: @ANON 23/9/11; JINDAL SAW

Looking first at the TECHNICALS; the Price Charts indicate that the Scrip is in oversold territory. On the downside, there is good support at 127 levels and solid support at 119 levels. On the upside any technical bounce could take it to 146 and then 157 where it faces strong resistance. Confirmation of uptrend only if it consistently trades above 163.

On the FUNDAMENTALS, the Corporate performance particularly in the last two Quarters has been pretty lacklustre with Margins being squeezed due to input material issues. The fact that the Sales profile is having a substantial overseas component also seems to have affected sentiment adversely. The newsflow regarding the Karnataka iron ore mining issue also seems to have definitely spooked the Markets vis a vis this Scrip.  The debt component on the Books is pretty substantial as well at around 1600 crores. However, everything is good at a price and Jindal Saw seems to have the worst behind it now. At CMP 136 it is trading at less than Book value and the risk-reward ratio seems favourable for long term entry. However, the upturn is likely to be a protracted affair and only long term investors would benefit by Accumulating the Stock at these levels.

Thus, in case you are a long term investor, you could Accumulate the Scrip on CMP and all dips and hold for the long term.

PS; ALSO READ ABOUT WELSPUN CORP HERE