Tuesday, February 09, 2010

Update on Coal and GUJ NRE COKE:-
We had talked about Coal Sector and GUJ NRE COKE in particular. Lets see why Coal prices are expected to rise.  

  • India could face a ‘coal shock’ sooner than later if the power utilities do not wake up to the fuel security risks from stagnating domestic production and start planning long-term coal imports to meet the fuel shortage. Although big power producers like NTPC are already meeting domestic coal shortages with imports, they have not shown any urgency to get into long-term import contracts. 
  • China’s coal demand has overtaken its domestic production, forcing the world’s largest coal producer to import coal. Till 2006, China was a net exporter of coal.
  • The global coal production in 2008 was 6.8 billion tonne while consumption stood at 6.7 billion tonne. China produced 43% of the world’s coal. So there is a clear risk that if a big coal consumer like India suddenly enters the world market, it could send international coal prices soaring.
  • Macquarie Research has maintained its ‘Outperform’ rating Gujarat NRE Coke post third quarter results. It expects the stock to touch Rs 103 target in next 12 months. http://economictimes.indiatimes.com/Views/Recommendations/Macquarie-sets-target-of-Rs-103-on-Gujarat-NRE-Coke/articleshow/5512351.cms
The stock has held on to the channel support so far and higher coal prices may drive the stock price higher in future. Accumulate for handsome returns.

India likely to face a coal shock - http://www.financialexpress.com/news/India-likely-to-face-coal-shock/576845/
Previous Post about Coal - the Black Diamond http://tanmaygopal.blogspot.com/2010/01/coal-black-diamond-india-is-3rd-largest.html

1 comment:

Anonymous said...

Honestly i m worried about the downfall ..but
now will accumulate it. Tnxs for the post.Hope u will continue such post
Now a days everyone talks of intraday
levels..but none like U. EXCELLENT !!