May 24, 2010

RNRL vs Reliance? a 50% trade? - Update III

Ho boy.. lucky that we got out of the trade while RNRL was still at 45.. Mukesh and Anil Ambani patched up. Now this is interesting if you think about it.. How exactly does this help RNRL.. They were getting gas at $4.2..which they still are.. nothing else changes. RCom can now hug and be merry with MTN now; but that should take the market cap down not up if Bharti-Zain is anything to go by..

This is a mere sentiment booster.. I think RNRL's longer term valuation still should remain at 30 to 40 levels.. Don't buy.. Shorting an ADAG stock is not a feat for the faint hearted.. and anyway, the quick trading move is over as discussed in my last post.

RelInfra and Relcap (esp RelCap which is a steal at 650 levels) are good buys from the ADAG group at current prices..

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