Praj Industries Ltd- A sceptical viewpoint

          Our team member met one of our olden days informant and member of big investor group in Mumbai who happen to have a age old experience and contacts among elite investors group in Mumbai. Among many other things he said Praj Industries could become a penny stock. This was interesting if not shocking for our analyst. He tried and dug dip. The informant said some big institutional holders are considering to sell this stock which has been underperforming since  2007 from 250 levels to around 50 levels now. The guy also said that interest into green energy has peaked for the medium term atleast. Also the present global recession will cause traditional energy resources prices to correct significantly and make the green energy costlier than the traditional ones.  After this stint our guy came down and the research team tried to dig deeper into this counter.

YEAR	2004	2005	2006	2007	2008	2009	2010	2011
% HOLDING OR RAKESH JHUNJHUNWALA	12.33	12.33	10.77	8.23	7.30	8.57	7.73	8.8
% SHARE HOLDING OF VINOD KHOSLA	-	-	1.94	8.88	6.15	5.26	4.01	3.11
SHARE PRICE IN JUNE MONTHS OF RESPECTIVE YEAR	5	35	80	240	175	110	80	70

                                    

Renewable Energy (Hydro, Wind, Solar Power) Companies Day's is yet to come

Hydro Power and Wind Power Companies shares are likely to underperform and discourage investors for short to medium term. They will become hot sectors after few years when the prices of traditional sources of energy such as crude oil, natural gas, coal etc skyrocket due to increasing demand and declining supply and production. Also the ROE Return on Energy would decline i.e. more than one dollar would be required to produce 1 dollar worth of crude or coal. At those times the wind power, hydropower, and solar power companies would start attracting investments (in fact they already have). Invention of newer and advanced technology would enable and support use of power generated from solar systems.