RESPONSE TO READER'S QUERIES; @V MANI 30/3/2012; IDEA CELLULAR

CMP 98.85                       BSE 17404

• The long term (5 year) Price Charts for IDEA CELLULAR look very good. However, the short term trend seems to be sideways albeit with a positive tenor.
• The first support that is evident is in the 94-96 range. A much stronger support which also coincides with the 200 SMA is at 90 closing basis. Below that, supports exist at 84 closing basis and then 80 closing basis.
• On the upside, 101 closing basis seems to be a major resistance / supply zone. A break above 101 closing basis and trades above the same for some time could take it beyond its 52 wk high (103) to about 107-110 levels. But the overwhelming feel I get is one of consolidation and the break out as above may not happen in the near term.
• As for brief  FUNDAMENTALS, frankly I am not a great fan of the Sector at this point in time since I feel that it has sort of plateaued off with a lot of sectoral headwinds ranging from falling/tardy ARPU growth, cut throat tariff based competition, Regulatory/ governmental issues etc which seems to be nullifying the obvious consumer pool availability. The best time to have got into the sector as a long term investor was perhaps 7 to 8 years ago wherein one would have participated in the exponential growth that the Sector saw.
• Having said the above, lest I sound overly bearish, I would hasten to add that from among the listed Companies in the Sector, my top pick would be IDEA. It has shown a much stabler performance on critical indicators than its peers.
• Short point is, that in case you are in it for the long term then hold on and possibly add more on dips as close to 90 levels as possible. At the very least, the Scrip would give your Portfolio that much more stability in the possible volatility/correction in the macro markets in the near term. You could look forward to a target of 120 or thereabouts over the next 12 months.
• However, if you wish to trade, then it may be a good idea to move out of the scrip and enter high beta infra / banks / realty ON DIPS which you might get in plenty next month.