Indiabulls has renamed Piramyd Retails’ Trumart stores as Indiabulls Mart and Indiabulls Megastore.
This follows the acquisition of Piramyd Retail by Indiabulls Wholesale Services, the retail arm of Indiabulls Real Estate, in December 2007.
Indiabulls is also re-launching these stores to win customers and improve margins by strengthening the supply chain and relationships with vendors.
‘’The stores are being redone in terms of what they sell, how they sell, and the user-experience,’’ said a senior group executive.
Piramyd has 35 neighbourhood convenience stores and seven lifestyle stores largely in the western.
Indiabulls is trying to leverage its relationships with suppliers to offer good deals at its convenience stores and win customers. ‘’We are trying to re-introduce the customers to Indiabulls Mart,’’ said Ikroop Singh, CEO, Indiabulls Wholesale Services.
This was necessary as a study conducted few weeks after it took over Trumart found that customers perceived these to be ‘’MRP stores’’ (goods sold at the maximum retail prices) and customers don’t often find the stuff they want.
When organised retailers were harping on price, Piramyd was not able to provide extra savings to customers as its business was not growing fast enough. Piramyd had initially planned to roll out 128 Trumart stores by 2010.
“Customers started equating it with kirana (neighbourhood grocery) stores’’ said an analyst tracking retail sector. Inability to scale up also meant that the chain could not attract the right margins from suppliers.
Retailers who buy from distributors operate on 8 per cent margin while organised retailers who sell bigger volumes command 10-12 per cent margin, which can go up to 18-20 per cent in some categories. Piramyd’s bargaining power with suppliers also suffered when it was talking to prospective suitors in the last six months.
The retail arm of Indiabulls Real Estate is setting up 30 hypermarkets in tier-II cities such as Jaipur and Ahmedabad, and has already procured land in 21 of the 30 cities.
It is also strengthening supply chains by implementing SAP and ensuring that all its formats (hypermarkets, lifestyle and convenience stores) are on same technology platform.
The company also plans to ramp up the number of convenience stores from 35 to 50 by March and also plans to open a few lifestyle stores. Indiabulls acquired 84 cent stake in Piramyd Retail in December for Rs 175 crore.
Shares of Piramyd Retail have more than doubled to Rs 199.75 on the BSE after it was acquired by Indiabulls. They had fallen to an all-time low of Rs 49 on August 24.
Understanding Short Term Trading
Before I begin, this blog is not for intraday traders. My definition of short term implies duration of around 2 to 3 months.
Short Term stock picking is no rocket science, but rather a visual interpretation of technical charts. A basic moving average on a time frame chart will show the direction of the securities movement.
Moving averages is a mathematical results calculated by averaging a number of past data points. Moving averages (MA) in it's basic form is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. Once the value of MA has been calculated, they are plotted onto a chart and then connected to create a moving average line. Typical moving averages used for short term trading are 50 MA and 100 MA.
Types of Moving Averages
1) Simple Moving Average (SMA)
SMA is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. The usefulness of the SMA is limited because each point in the data series is weighted the same, regardless of where it occurs in the sequence. Critics argue that the most recent data is more significant than the older data and should have a greater influence on the final result.
2) Exponential Moving Average (EMA)
EMA overcomes the limits of SMA, where more weight is given to the recent prices in an attempt to make it more responsive to new information. When calculating the first point of the EMA, we may notice that there is no value available to use as the previous EMA. This small problem can be solved by starting the calculation with a simple moving average and continuing on with calculating the EMA.
The primary functions of a moving average is to identify trends and reversals, measure the strength of an asset's momentum and determine potential areas where an asset will find support or resistance. Moving averages are lagging indicator, which means they do not predict new trend, but confirm trends once they have been established.
A stock is deemed to be in an uptrend when the price is above a moving average and the average is sloping upward. Conversely, a trader will use a price below a downward sloping average to confirm a downtrend. Many traders will only consider holding a long position in an asset when the price is trading above a moving average.
In general, short-term momentum can be gauged by looking at moving averages that focus on time periods of 50 days or less. Looking at moving averages that are created with a period of 50 to 100 days is generally regarded as a good measure of medium-term momentum. Finally, any moving average that uses 100 days or more in the calculation can be used as a measure of long-term momentum.
Support, resistence and stoploss can be infered by referring the closet MA below or above the market price. The other factor that is used in short term momentum is the trading volume. The moving averages along with the trading volume can provide a better insight to short term movement.
Markets are moved by their largest participants - I believe this is the single most important principle in short-term trading. Accordingly, I track the presence of large traders by determining how much volume is in the market and how that compares to average. Because volume correlates very highly with volatility, the market's relative volume helps you determine the amount of movement likely at any given time frame--and it helps you handicap the odds of trending vs. remaining slow and range bound.
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