SIFY is in a bull trend as you can see on the chart below:
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=11432;image)
Looking at the company's financials since 1999 (I can do it pretty fast with a paid service I got), I see steady revenue growth at SIFY, from about 1.9 million a quarter in 1999 to 26 million in the 3rd quarter of 2005.
The revenue multiple for SIFY is 2.96, for REDF is 30.94 and for YHOO is 11.25.
Cramer said the following about SIFY: "Sify is not Google. It is an Indian Internet play. It's OK but not great." Of course SIFY is not Google, GOOG has a $123 billion market cap, SIFY is worth just $308 million. I think that's enough difference from an «American» company to an «Indian» company.
Thinking of India as a «fast growing economy» I believe SIFY will provide an attractive short and long term investment.
I'll buy SIFY for the 3 Stocks on Fire Portfolio around today's open, 6.66% of capital as always.
;D ;D ;D ;D ;D
SIFY broke out of a long term resistance yesterday with a powerful white marubozu. The stock is cheap, growth is big and stable, the market agrees with it.
Maybe another white marubozu today to complete a 3 white soldiers pattern, I don't know.
What I do know is that I want to keep on holding SIFY, they say a good trade is profitable right from the start, I think I can call SIFY a good trade. Having a good trade on my hands I need to be a good trader and let the profits run.
After a gap up the stock came down to retest the long term resistance that was broken yesterday. Although there are two news that can take SIFY down, it doesn't make any sense.
The first is this:
«Correction: Earns-Rediff.com Story
Tuesday December 13, 5:48 pm ET
MENLO PARK, Calif. (AP) -- In an Oct. 24 story about Rediff.com India Ltd.'s second quarter earnings, The Associated Press erroneously reported that the company earned $1.16 per American depositary share in the period. Instead, the company earned 1.16 cents per ADS, or 1 cent after rounding.»
I remember that when I was looking at SIFY I also read some things about REDF and thought it was incredibly expensive. Perhaps it would be a good hedge, long SIFY and short REDF. But I'm a bit afraid the stock opens with a big gap down today (on my news feeder the earnings news is right - but since these companies don't file the 10-Q report with the SEC, an erroneous press release may induce many people in error).
The other news is about BIDU: UPDATE 2-Baidu stock drops as public share float jumps (http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh44307_2005-12-14_01-14-28_n13302312_newsml)
Probably SIFY will go down in sympathy with REDF and BIDU, but it doesn't make much sense, SIFY has nothing to do with REDF or BIDU.
Since probably the open will be a lot lower there's no point in selling now to buyback at lower levels. I'll continue holding SIFY.
SIFY came down to exactly close the gap between $8.83 and $8.86. After this pullback the stock is ready to push higher again. I'll continue holding without reserves.
Yes, SIFY is coming back. Unfortunately I don't have time today to write more about it, sometimes I should change the order in which I do these updates, because I'm always running out of time when I get to the last holdings on the list.
I'll continue holding SIFY.
Hi, David:
One suggestion: it is better if you could give update Sunday night instead of Monday morning so you can have enough time to prepare.
Many online investment services did so (they gave weekly update on Sunday).
David,
Are you concerned that SIFY is overbought and maybe too extended? Could it it fail and fall big time?
Thanks for your thoughts.
dcrlin
Quote from: David Randolph on December 16, 2005, 08:51:05 AM
Yes, SIFY is coming back. Unfortunately I don't have time today to write more about it, sometimes I should change the order in which I do these updates, because I'm always running out of time when I get to the last holdings on the list.
I'll continue holding SIFY.
Quote from: shawFund on December 17, 2005, 04:13:14 AM
Hi, David:
One suggestion: it is better if you could give update Sunday night instead of Monday morning so you can have enough time to prepare.
Many online investment services did so (they gave weekly update on Sunday).
Yup, I agree with Shawfund.... anyway SIFY chart looks pretty good.. David, what is your price target for this bulllish stock?
Me too. I agree with Shawfund and Terlisa.
Also, Is it posible to get the updates on the previous night instead of right before the market openings?
Thanks!
Quote from: minkielover on December 19, 2005, 01:23:51 AM
Me too. I agree with Shawfund and Terlisa.
Also, Is it possible to get the updates on the previous night instead of right before the market openings?
Thanks!
Thanks for your suggestion :) Yes, it is possible, the «problem» is my family :-* You know, my kid is always at school (and I'm at work) and I can only be with him at evening, after dinner, precisely after the US markets close.
But I'll see with my wife if we can arrange things so I can at least start updating holdings after the close, instead of before the open.
I don't know about the short term, but I feel inspired by the long term, just as Raju Vegesna is:
Silicon Valley Entrepreneur Raju Vegesna's Investment Partnership to Infuse Rs 1721 Million Into Sify in Addition to Acquiring Satyam's 31.61% Share; Investment a Vote of Confidence in Company's Performance and Future (http://www.marketwatch.com/tools/quotes/newsarticle.asp?dist=¶m=archive&siteid=mktw&guid=%7BEBF8EC0B%2DC242%2D44E7%2DB14D%2DB2684B7F682E%7D)
«Satyam's divestiture is in line with its stated objective to emerge as pure play IT services and Solutions Company. As against its original investment of US $ 5 million in Sify, Satyam has received a total consideration of about US $117 million till date, making it a highly successful and value creating investment for Satyam's shareholders.»
Sify already gave 23 bags of profit to Satyam, I wonder how much will it give to Raju? If it also gives 23 bags we would see $129 a share for SIFY.
Fundamental trends in the company show clear growth in revenues and it is near profitability.
I'll continue holding SIFY, the trend is bullish and you're well accompanied on this investment :)
We had a great rally yesterday on SIFY but then the general market tone took it down by the end of the session. Everything seems to be fine with SIFY's fundamentals, the company has great potential. But there's the general market risk.
I want to continue holding SIFY but protect myself from the general market risk in a clever way. On past updates I said the following:
QuoteI remember that when I was looking at SIFY I also read some things about REDF and thought it was incredibly expensive. Perhaps it would be a good hedge, long SIFY and short REDF. But I'm a bit afraid the stock opens with a big gap down today (on my news feeder the earnings news is right - but since these companies don't file the 10-Q report with the SEC, an erroneous press release may induce many people in error).
Since this update, SIFY went up 12.4% and REDF declined 8%.
Looking at the fundamentals of both companies, I believe this
1) If the market goes down REDF will go down much more than SIFY;
2) If the market goes up SIFY will rise much more than REDF;
3) If current trends continue, SIFY will go up and REDF will go down, making this hedge profitable in both ways.
So, I'll continue holding SIFY and will protect this investment selling REDF short.
SIFY rose 6.8%, REDF rose 2.7%. This hedge between these two Indian stocks, one undervalued and other overvalued allows me to comfortably continue holding SIFY.
SIFY is the best pick among all the stocks here. But we do not need to use REDF to hedge it.
Both are in bullish trend. Doing so will just cancelled out the gains from SIFY.
For me, buy SIFY but not short REDF.
I found out whoever shorts a stock, the stock went up. Even MSN Money short picks have the same result. All of their short picks are in red.
If the stock is going down, the mm did not want to give the stocks to you to short like I tried few months ago for MOVI short. Didn't get the shares to short.
Actually my shorts are the best investments for the time being...
I'm again short whit GM since 1st dic. (@22.48) )and VDSI since 25 dic.(@ 10.11)
I'm thinking of closing this week one of these and open a new short with redf when the trend change..
my last shorts closed ....
GM 7/9/2005 - 13/10/2005 ---> 26%
TOL 26/8/2005 - 13/10/2005 ---> 28%
CELG 21/10/2005 - 26/10/2005 ---> - 3%
RIMM 25/10/2005 - 08/11/2005 ---> - 10%
VLO 7/11/2005 - 7/12/2005 ---> - 1%
the others one's ....
GM 1/12/2005 ---- open --- > 21%
VDSI 15/12/2005 --- open ---> 3%
Thanks for your posts :)
Now I have a 28% profit in SIFY, and I don't feel pressure to take the profit. Why? Because I «know» that if SIFY goes down, REDF will probably fall 3 times more in percentage terms, so that day I will win anyway.
Hedging is cool :)
I'll continue holding SIFY.
There were some news just before the close on SIFY:
«Item 1.01. Entry into a Material Definitive Agreement.
On December 20, 2005, Sify Limited ("Sify") entered into a Shareholders' Agreement (the "Agreement") with Infinity Satcom Universal (P) Limited ("Infinity Satcom") and Safescrypt Limited, a wholly owned subsidiary of Sify ("Safescrypt"). Pursuant to the Agreement, Sify will sell 4,680,000 shares of Safescrypt's capital stock, representing a 26% equity interest in Safescrypt, to Infinity for approximately $3.1 million in cash. In addition, Sify will transfer its virtual private network services business to Safescrypt (the "VPN Services Transfer") at a valuation of approximately $11.1 million. The valuation was arrived at based on third party appraiser's opinion. Sify's audit committee approved the VPN Services Transfer.
Infinity Satcom is owned by Anand Raju, who is the brother of Raju Vegesna. Raju Vegesna is the Chairman of Sify's Board of Directors and the principal of Infinity Capital Ventures, LP ("Infinity Capital"). Infinity Capital owns approximately 32% of Sify's outstanding equity shares and, upon the terms and subject to the conditions set forth in a Subscription Agreement dated November 10, 2005 (the "Subscription Agreement") with Sify, may purchase additional equity shares or ADSs from Sify.
The foregoing description of the Agreement is qualified in its entirety to the full text of the Agreement, which is attached hereto as Exhibit 99.1.
Item 8.01. Other Events.
At the extraordinary general meeting held on December 23, 2005, Sify's stockholders approved (i) an increase in Sify's authorized capital to Rs. 500 million divided into 50,000,000 equity shares of Rs. 10 each and a related change to Sify's Memorandum of Association, (ii) the issuance of up to 11,700,000 equity shares, ADSs or other securities and (iii) the VPN Services Transfer. Of the securities approved for issuance, it is expected that Sify will issue 6,720,260 ADSs to Infinity Capital pursuant to the Subscription Agreement.»
This news means dilution. I really don't like dilution.
I'll take profits on SIFY around today's open.
I'll be looking to buyback shares at TL2 on the chart below.
The trading plan is:
1) Take profits on SIFY around today's open;
2) Buy it back at TL2, which today stands at $8.52
Looks like SIFY took a hit. Do you see this as a buying op or is the news going to keep this down for a while? Trading under 10 right now.
In the past I bought SIFY at $8.93 and sold at $11.33 for a 27% profit. Fundamentally nothing has changed (fundamentals continued to improve and the company is now cash flow positive) and SIFY is trading around $9, exactly at its long term support level.
If I ever wanted to get back into SIFY, this seems to be the right time.
That's what I'll do, buying 10% of the Stocks on Fire Portfolio capital around today's open.
(more in depth analysis on the first update)
David,
I know you probably bought SIFY (up 7.14% on high AH's volume - 99,094) today even it's not showing under 3SOF Portfolio.
I followed your recommendation and bought at $9.14. Although we had a spike in AM the stock couldn't hold at those levels. I was worried because SIFY not only got below the $8.85 low of 1/18/06, but also the $8.83 low of 12/14/05, and closed above both those lows on very light volume. And for sure I didn't like a close in the teens, bellow the 50 MA.
But the intresting thing happened in AH when Cramer recommended REDF in his show (up 19% in AH). He said REDF is not only the Indian version of Yahoo! but may be the Indian Google :o. Although I disagree with his opinion on REDF I have to admit that anything in India is on fire right now, in addition to raised interest rates, which should weigh on its stocks.
Anyways, since we had both stocks in the portfolio and know that SIFY is the better one, I assume it makes sense to see this rise in the afterhours as a carryover from those doing their homework.
Let's see what tomorrow brings............ ;)
Quote from: Jimbo on January 24, 2006, 11:37:28 PM
David,
I know you probably bought SIFY (up 7.14% on high AH's volume - 99,094) today even it's not showing under 3SOF Portfolio.
I followed your recommendation and bought at $9.14. Although we had a spike in AM the stock couldn't hold at those levels. I was worried because SIFY not only got below the $8.85 low of 1/18/06, but also the $8.83 low of 12/14/05, and closed above both those lows on very light volume. And for sure I didn't like a close in the teens, bellow the 50 MA.
But the intresting thing happened in AH when Cramer recommended REDF in his show (up 19% in AH). He said REDF is not only the Indian version of Yahoo! but may be the Indian Google :o. Although I disagree with his opinion on REDF I have to admit that anything in India is on fire right now, in addition to raised interest rates, which should weigh on its stocks.
Anyways, since we had both stocks in the portfolio and know that SIFY is the better one, I assume it makes sense to see this rise in the afterhours as a carryover from those doing their homework.
Let's see what tomorrow brings............ ;)
Thanks for the info Jimbo :)
It looks like Cramer gave us a gift, great ;D Actually, as I was doing some more DD, I was getting some doubts on this SIFY trade. So I welcome Cramer's recommendation and sell into it.
But not right at the open, just at the $10.27-$10.32 gap (about a 14% rise from yesterday's closing price). I will also sell REDF short if I have the chance, around $18.60 (throwback to the neckline - a 23% rise).
I see this recommendation from Cramer as a chance to obtain a profit on my SIFY trade, which was already showing a loss and a chance to short REDF again at an attractive price.
I don't go with statements like «this is India's Google» anymore.
WOW! REDF is at $20 :o.....it's a shame my broker, E-Trade, won't let me short it. They say they don't have any shares to borrow. Anyone else having this issue?
Quote from: bocasva on January 25, 2006, 09:37:52 AM
WOW! REDF is at $20 :o.....it's a shame my broker, E-Trade, won't let me short it. They say they don't have any shares to borrow. Anyone else having this issue?
I was able to sell it short right at the open, maybe a bit early ... also sold SIFY at $10.30.
Maybe if you call E*Trade ... this is insane, this stock isn't worth this at all.
Boc - be thankful your broker has no shares to short. 15 minutes into the day and volume is already its highest of the year. You don't want to short this beast right now!
Hey bocasva,
call your broker - with this kind of volume they should be able to find you some shares ;)
I use Scottrade - no problem ;)
BTW I was expecting gap up but is too much :o
Quote from: Jimbo on January 25, 2006, 09:58:55 AM
Hey bocasva,
call your broker - with this kind of volume they should be able to find you some shares ;)
I use Scottrade - no problem ;)
BTW I was expecting gap up but is too much :o
I called Etrade Premium customer service and they said the same thing, that they are unable to borrow shares either from in-house or outside. Not sure what to make of this, but it sure makes me want to switch brokers. No problem, I wish you good luck all.
Good short term play. Two days gained a lot.
If we have the same strategy for INSM, we would be up 20% on that stock in one day..
In agreement REDF is a good short play, in spite of the Cramer Gap today.
Apparently, David and I are not the only one's of that opinion:
http://www.thestreet.com/_yahoo/tech/internet/10264068.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA
Why I'm Short Rediff
By Doug Kass
Street Insight Contributor
1/25/2006 2:54 PM EST
Click here for more stories by Doug Kass
Editor's Note: This column by Doug Kass is a special bonus for TheStreet.com and RealMoney readers. It first appeared on Street Insight at 2:04 p.m. EST. To sign up for Street Insight, where you can read Kass' commentary in real time, please click here.
Jim "El Capitan" Cramer writes about Rediff.com (REDF:Nasdaq ADR - commentary - research - Cramer's Take), a company that he mentioned on "Mad Money" last evening.
Today, the shares are more than 35% higher based on Jimmy's bullish comments on the company last evening in which he forecast that it would rise to $20 in the next few months. It did that this morning! I view REDF with less enthusiasm than my pal does and I will have some more detailed thought on REDF over the next few days.
In a recent piece, I suggested that some of "Mad Money's" viewers get caught up in the moment and bid -- with Internet speed -- some of his recommendations to absurd levels. (Jimmy justifiably ridicules such aggressive after-market buying in his column!) From my perch, REDF is a clear example of this giddiness, and I have taken a short rental (short-term long) in the name as I believe it will retreat right back into the midteens over the next few weeks.
REDF is an unprofitable company with about 200 employees. The company publishes two newspapers and provides online information on shopping, entertainment -- oh yes and matchmaking and cricket! In addition, REDF provides a chat and messaging service in India. The company's annual revenues are less than $15 million -- down 30% from 2003 -- and the company has never been profitable. In this writer's opinion, comparisons of REDF to Google (GOOG:Nasdaq - commentary - research - Cramer's Take) and Yahoo! (YHOO:Nasdaq - commentary - research - Cramer's Take) fall ... ahem, quite a bit short! More to come.
SIFY up in After Hours (RT-ECN): 12.69 1.91 (17.72%), Volume 116,640 >:D
February 03, 2006 16:59 ET (21:59 GMT) :
DJ India Sify CEO: Expects First Ever Profit In Fiscal 4Q
By Claudia Assis
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Indian Internet service provider Sify Ltd. (SIFY) expects to turn a profit in its fiscal fourth quarter in what would be the company's first positive result since its inception in 1995, Chief Executive Officer R. Ramaraj said Friday.
What gives Ramaraj hope is that the fourth quarter, which ends in March for Indian firms, is usually the busiest time of the year for Internet companies. Sify also pared its losses recently, he said.
"We are very close to profitability," Ramaraj told Dow Jones Newswires in an interview.
In the fiscal third quarter ended in December, Sify trimmed its losses to $230,000, compared to a net loss of $2.11 million in the same quarter of 2004. The company posted a net loss of $1.4 million in the fiscal second quarter that ran from June to September 2005.
According to Ramaraj, the January to March quarter is busy for Sify's business because many Indian companies try to use up money on their budgets before the end of the fiscal year. For operations related to its individual consumers, February and March are the months when scores of young Indians apply for college and take mock examinations on the Internet, increasing traffic and thus advertising revenue, he said.
Sify is following in the footsteps of Time Warner Inc.'s (TWX) AOL in providing means to access the Web as well as content, Ramaraj noted.
The company, which is listed in the U.S. but not in India, also owns 3,100 cyber cafes in 150 cities across the South Asian country, while its closest competitor owns about 240 Internet cafes. Sify also offers information technology monitoring and maintenance services for local and overseas businesses.
About 45% of Sify's revenue comes from individual consumers, with the remaining 55% from companies, Ramaraj said.
Despite its lack of profits, Sify is riding a wave of interest for Indian Internet companies, fueled by forecasts of a fourfold growth in Internet usage in that country.
Estimates vary on how many Indians have regular access to the Internet, but some put that number at 25 million people in a country of more than one billion. According to a report by trade group Internet and Mobile Association of India, the country will have 100 million Internet users by 2007-08.
Market potential in India is just behind China's, said Ramaraj. The Indian Internet market may mirror the wireless phone business, which took off a little after China but is growing at the same fast pace since, Ramaraj noted.
"These are exciting times for growth," he said.
Sify intends to take advantage of its unique position as a connectivity as well as a content provider, Ramaraj said. It also fends off competitors, which include Yahoo Inc. (YHOO)'s India unit and Google (GOOG), with a better understanding of the local market and being first in the Internet business segment, he added.
The company provides e-mail services in nine regional languages and content in five of India's main languages, Ramaraj pointed out. Sify also provides broadband services, allowing for forays into paid music downloading, movie clips from Bollywood - as India's film industry is known, and interactive scorecards for cricket matches.
"What we have been doing is betting on broadband and betting on the young," Ramaraj said. About half of India's population is in the working age group.
Ramaraj said that local rivals such as Rediff.com (REDF) will also eventually enter the broadband business, but "we've got the head start at the moment."
Sify also plans to seek more business clients overseas in the next fiscal year, which starts in April. The company currently has six clients abroad, for whom it oversees data centers and servers, among other applications. Ramaraj expects to add to the list shortly.
"That's a segment that is going to grow very fast ... it is the next wave of off-shoring," said Ramaraj, but declined to provide guidance on how many new clients Sify expects in the 2006-07 fiscal year. He said, however, that most new clients would come from the U.S.
Sify, headquartered in Madras, was up 1.1% at $10.78 at around 4:40 p.m. EST Friday. The stock's 52-week high was $12.35, while its 52-week low was $3.81.
Sify is doing well today. Gapped up and around 12.25 now ;D
hi
Sify is up .5 today to 13.80
High of the day is $14.00
I will sell a few shares.
Lalitha