The sensex will rise to 23,350 by end-2011 from close of 19,696.48 on December 8, according to the median response in a poll taken from 18 market participants, which include investment banks and brokerage firms.
Saturday, December 25, 2010
BSE Sensex seen rising 20% by end-2011: Poll
The sensex will rise to 23,350 by end-2011 from close of 19,696.48 on December 8, according to the median response in a poll taken from 18 market participants, which include investment banks and brokerage firms.
Friday, December 24, 2010
World stocks set for best Dec performance in a decade
World stocks clung near two-year peaks while oil rose towards the $92 per barrel mark this week after yet another burst of strong economic figures from the United States encouraged some year-end buying.
The latest rally in major European and U.S. stock indices has given investors the biggest December gains in more than a decade.
Expectations of strong U.S. fourth quarter performance was further cemented by latest data which showed demand for durable goods rising and consumer spending picking up.
A slew of strong numbers coming out of the world's biggest economy in recent weeks has given global growth bulls another reason to cheer and boosted commodities and stocks.
Reflecting that growing optimism, the Asia Pacific-ex Japan shares for energy shares advanced slightly while other indexes were broadly flat to slightly lower.
Trading was thin and prices confined in narrow ranges in Asia, with many centers on holiday in thin year-end markets. U.S markets are also shut along with many European centers.
World stocks as measured by the MSCI extended gains by nearly 6.5 percent so far this month while the Asia-Pacific version was largely unchanged.
"In the U.S., fears of a double dip recession have receded considerably with the extension of tax relief agreed in December and a second round of quantitative easing in November," Fitch Ratings said.
" High frequency activity has also turned more positive, reflecting strength in private consumption and corporate profitability."
That has made investors more sanguine towards developed markets.
Latest EPFR data showed developed markets equity funds posted their longest fund inflow streak since the fourth quarter of 2009 at the expense of emerging markets equity funds.
The latest rally in major European and U.S. stock indices has given investors the biggest December gains in more than a decade.
Expectations of strong U.S. fourth quarter performance was further cemented by latest data which showed demand for durable goods rising and consumer spending picking up.
A slew of strong numbers coming out of the world's biggest economy in recent weeks has given global growth bulls another reason to cheer and boosted commodities and stocks.
Reflecting that growing optimism, the Asia Pacific-ex Japan shares for energy shares advanced slightly while other indexes were broadly flat to slightly lower.
Trading was thin and prices confined in narrow ranges in Asia, with many centers on holiday in thin year-end markets. U.S markets are also shut along with many European centers.
World stocks as measured by the MSCI extended gains by nearly 6.5 percent so far this month while the Asia-Pacific version was largely unchanged.
"In the U.S., fears of a double dip recession have receded considerably with the extension of tax relief agreed in December and a second round of quantitative easing in November," Fitch Ratings said.
" High frequency activity has also turned more positive, reflecting strength in private consumption and corporate profitability."
That has made investors more sanguine towards developed markets.
Latest EPFR data showed developed markets equity funds posted their longest fund inflow streak since the fourth quarter of 2009 at the expense of emerging markets equity funds.
Thursday, December 23, 2010
Investors enter 2011 in bullish mood - Reuters poll
Investors are entering 2011 in a relatively bullish mood, raising equity holdings to a 10-month high, increasing exposure to high-yield credit and cutting back on government debt, Reuters polls showed yesterday.
Within bond portfolios, however, concern about the cost of U.S. Treasuries and the stability of euro zone debt, did not show up dramatically.
Allocations to emerging market debt were cut instead.
Surveys of 55 leading investment houses in the United States, Europe ex UK, Japan and Britain showed investors holding 54.1 percent of a typical mixed-asset portfolio in stocks in December.
That was up from 53.2 percent in November and the highest since 55.4 percent in February.
Bonds were cut to 33.9 percent, the lowest since February, from 34.2 percent in November. Cash was at 3.9 percent, down from 4.6 percent.
A combination of improving economic data and a belief in future, robust, corporate earnings has lifted investor appetite for equities over the past few months. The MSCI all-country world stock index was flirting yesterday with levels last seen in September 2008.
"People are coming off the sidelines and buying stocks," said Keith Wirtz, president and chief investment officer at Fifth Third Asset Management in Cincinnati.
There was also sign of risk appetite in an increased exposure to riskier, higher yield bonds.
At the same time concerns have risen that yields on benchmarket government bonds are too low, providing little return and threatening a sell-off.
Investors in the Reuters polls did cut back overall exposure to bonds. But when it came to the money left for bonds they favoured U.S. and euro zone government debt over most emerging markets, which have been very popular this year.
Exposure to emerging market debt was 8.1 percent of a bond portfolio for the month, compared with 9.6 percent a month earlier.
Investors also regained some composure about euro zone government bonds following the crisis over Ireland's debt. They raised exposure within a bond portfolio to 31.5 percent from 31.2 percent, although these numbers remain well below the more than 42 percent seen at the beginning of 2010.
REGIONALLY
U.S. fund managers built up their equity holdings in December to one of the highest points this year on signs of a swifter economic recovery.
The poll, which surveyed 13 U.S.-based fund management companies, showed firms boosting their equity allocations for the fourth month in a row to an average of 65.0 percent, two percentage points over November.
The Reuters poll also showed money managers scaling back their exposure to bonds for a fourth consecutive month, to 27.9 percent of their portfolios in December, compared with 30.2 percent last month.
Japanese fund managers held on to most of their global stock weighting in the month and raised their bond allocation to the highest level since September on the view that recent falls in bond prices were overdone.
The 13 respondents also lowered their cash position to the lowest level in more than a year.
Asset managers' average weighting for global equities in the Japanese poll fell only 0.1 percentage point from the previous month to 47.1 percent. The weighting for bonds rose to 48.3 percent in December from 46.9 percent last month.
European fund managers lifted equity holdings to a 11-month high and also boosted bonds.
The survey of 17 Europe-based asset management firms outside Britain released showed a typical mixed portfolio holding 50.1 percent in equities this month, compared with 49.6 percent in November.
It held 37.5 percent in bonds including government and corporate debt, compared with 37.3 percent last month. Cash holdings fell to 5.3 percent from 6.1 percent, hitting their lowest level since January.
British fund managers increased their exposure to equities, particularly domestic UK stocks, and cut back on bonds.
The survey of 12 investment managers showed the average allocation to global equities climbed to 54.2 percent from 52.8 percent.
Bond holdings dropped to 22.0 percent from 22.5 percent.
Exposure to UK stocks within equities jumped to 16.3 percent from 12.6 percent in November.
Within bond portfolios, however, concern about the cost of U.S. Treasuries and the stability of euro zone debt, did not show up dramatically.
Allocations to emerging market debt were cut instead.
Surveys of 55 leading investment houses in the United States, Europe ex UK, Japan and Britain showed investors holding 54.1 percent of a typical mixed-asset portfolio in stocks in December.
That was up from 53.2 percent in November and the highest since 55.4 percent in February.
Bonds were cut to 33.9 percent, the lowest since February, from 34.2 percent in November. Cash was at 3.9 percent, down from 4.6 percent.
A combination of improving economic data and a belief in future, robust, corporate earnings has lifted investor appetite for equities over the past few months. The MSCI all-country world stock index was flirting yesterday with levels last seen in September 2008.
"People are coming off the sidelines and buying stocks," said Keith Wirtz, president and chief investment officer at Fifth Third Asset Management in Cincinnati.
There was also sign of risk appetite in an increased exposure to riskier, higher yield bonds.
At the same time concerns have risen that yields on benchmarket government bonds are too low, providing little return and threatening a sell-off.
Investors in the Reuters polls did cut back overall exposure to bonds. But when it came to the money left for bonds they favoured U.S. and euro zone government debt over most emerging markets, which have been very popular this year.
Exposure to emerging market debt was 8.1 percent of a bond portfolio for the month, compared with 9.6 percent a month earlier.
Investors also regained some composure about euro zone government bonds following the crisis over Ireland's debt. They raised exposure within a bond portfolio to 31.5 percent from 31.2 percent, although these numbers remain well below the more than 42 percent seen at the beginning of 2010.
REGIONALLY
U.S. fund managers built up their equity holdings in December to one of the highest points this year on signs of a swifter economic recovery.
The poll, which surveyed 13 U.S.-based fund management companies, showed firms boosting their equity allocations for the fourth month in a row to an average of 65.0 percent, two percentage points over November.
The Reuters poll also showed money managers scaling back their exposure to bonds for a fourth consecutive month, to 27.9 percent of their portfolios in December, compared with 30.2 percent last month.
Japanese fund managers held on to most of their global stock weighting in the month and raised their bond allocation to the highest level since September on the view that recent falls in bond prices were overdone.
The 13 respondents also lowered their cash position to the lowest level in more than a year.
Asset managers' average weighting for global equities in the Japanese poll fell only 0.1 percentage point from the previous month to 47.1 percent. The weighting for bonds rose to 48.3 percent in December from 46.9 percent last month.
European fund managers lifted equity holdings to a 11-month high and also boosted bonds.
The survey of 17 Europe-based asset management firms outside Britain released showed a typical mixed portfolio holding 50.1 percent in equities this month, compared with 49.6 percent in November.
It held 37.5 percent in bonds including government and corporate debt, compared with 37.3 percent last month. Cash holdings fell to 5.3 percent from 6.1 percent, hitting their lowest level since January.
British fund managers increased their exposure to equities, particularly domestic UK stocks, and cut back on bonds.
The survey of 12 investment managers showed the average allocation to global equities climbed to 54.2 percent from 52.8 percent.
Bond holdings dropped to 22.0 percent from 22.5 percent.
Exposure to UK stocks within equities jumped to 16.3 percent from 12.6 percent in November.
Monday, December 20, 2010
The blind investment banker with a vision....
Breaking records has been a way of life for this 30-year-old banker from Mumbai -- be it in life, at work or in sports. But he is a trader with a difference.
Ashish Goyal works for J P Morgan Chase as a chief investment officer and is passionate about macroeconomics and the financial markets. And Mr Goyal is blind.
A New York Times article says looking at Ashish work one can hardly figure out that he is visually impaired - the speed and accuracy with which he manages billions of dollars of the bank's exposure to risks like foreign exchange fluctuations.
Outside his official assignment, Ashish represented the Metro London Sports Club in 2009 in the United Kingdom's domestic blind cricket league. In his very first year, he became a prominent member of the team contributing to winning the UK league. His friends find it difficult to keep pace with his social life that ranges from theatre, music, charity work to Formula F1, tennis and globetrotting to 'watching' cricket matches.
Ashish, who was born with perfect vision, suffers from a disease called retinitis pigmentosa, which robbed him of his sight after the age of 15. He did not lose his vision at one go, but gradually went blind over a period of three years. By 18, he couldn't see anything at all.
He was the first blind student to make it to Wharton Business School, Philadelphia, four years ago. If that isn't enough, Ashish cleared his MBA with honours and went on to win the Joseph P Wharton award, given to one student every year who symbolizes Wharton's way of life.
Ashish, who now lives in London, is the first blind trader at J P Morgan, and possibly in any bank anywhere in the world. His near-impossible feat has earned him the National Award for the Empowerment of Persons with Disabilities, 2010, an honour that he will receive at the hands of the President of India this week.
Ironically, while Ashish will return to India to receive his award, this country has been a trifle hostile to him during his first attempt at entering the job market. He had a tough time getting a job in India, despite securing a second rank in his batch while doing an MBA at NMIMS.
Ashish Goyal works for J P Morgan Chase as a chief investment officer and is passionate about macroeconomics and the financial markets. And Mr Goyal is blind.
A New York Times article says looking at Ashish work one can hardly figure out that he is visually impaired - the speed and accuracy with which he manages billions of dollars of the bank's exposure to risks like foreign exchange fluctuations.
Outside his official assignment, Ashish represented the Metro London Sports Club in 2009 in the United Kingdom's domestic blind cricket league. In his very first year, he became a prominent member of the team contributing to winning the UK league. His friends find it difficult to keep pace with his social life that ranges from theatre, music, charity work to Formula F1, tennis and globetrotting to 'watching' cricket matches.
Ashish, who was born with perfect vision, suffers from a disease called retinitis pigmentosa, which robbed him of his sight after the age of 15. He did not lose his vision at one go, but gradually went blind over a period of three years. By 18, he couldn't see anything at all.
He was the first blind student to make it to Wharton Business School, Philadelphia, four years ago. If that isn't enough, Ashish cleared his MBA with honours and went on to win the Joseph P Wharton award, given to one student every year who symbolizes Wharton's way of life.
Ashish, who now lives in London, is the first blind trader at J P Morgan, and possibly in any bank anywhere in the world. His near-impossible feat has earned him the National Award for the Empowerment of Persons with Disabilities, 2010, an honour that he will receive at the hands of the President of India this week.
Ironically, while Ashish will return to India to receive his award, this country has been a trifle hostile to him during his first attempt at entering the job market. He had a tough time getting a job in India, despite securing a second rank in his batch while doing an MBA at NMIMS.
Friday, October 22, 2010
The first buyer of my second book - Shivangi Dhingra....
The first buyer of my second book - Shivangi Dhingra....
Friday, October 15, 2010
My second novel: "The Inheritance" has been published...
Cheers! My second novel: "The Inheritance" has been published. Click on the following link to check out the details and also to place an order on the publisher's website: http://www.atlanticbooks.com/browse/details.asp?id=22396
Infosys Q2 net profit up 13 pct
MUMBAI (Reuters) - Infosys Technologies (INFOSYS.BO : 3137 -47.25), India's second-largest software services exporter, beat street estimates with a 13 percent rise in quarterly net profit helped by increased spending on IT projects by clients.
Bangalore-based Infosys said today net profit for its second quarter ended Sept. 30 rose to 17.4 billion rupees ($395 million) from 15.4 billion rupees a year ago.
Brokerages polled by Reuters had forecast profit of 17.17 billion rupees for Infosys, which counts Goldman Sachs, BT Group and BP among its main clients.
Shares in Infosys rose 2 percent to an all-time high after the results but turned negative later.
COMMENTARY:
AMBAREESH BALIGA, VICE-PRESIDENT, KARVY STOCK BROKING, MUMBAI
"It is better than expectations, but there's nothing to be enthused about it. Rupee will play a spoil sport going forward. We don't expect a major bump up in the stock price.
"Billing rates are not going up for the sector although there's good growth in volumes. Also there's pressure from overhead expenses."
PRAKASH DIWAN, HEAD OF INSTITUTIONAL BUSINESS AT NETWORTH STOCK BROKING, MUMBAI
"I would not read much into the fall in stock price. The stock was pricing in most near-term positives. It had run up a lot on expectations and such a reaction is expected.
"Also, Infosys has had a history of beating its own guidance and street estimates. So, people do tend to factor in that before results"
NIRAJ DEWAN, DIRECTOR, QUANTUM SECURITIES, NEW DELHI:
"On the margins side there was some pressure but that is more because of the rupee dollar movement. If the rupee dollar appreciation continues, then there could be some disappointment in the current quarter in terms of margins. Attrition would be another challenge, as the rate of attrition was higher in this quarter than the last."
"The stock is pressured because it has already run up and the guidance they are giving is not towards the higher end, it is towards the lower end of expectations."
ROHIT ANAND, RESEARCH ANALYST, PINC RESEARCH, MUMBAI:
"In dollar terms the growth is good. Expecting a good set of numbers from other IT companies as well, especially the large caps. Going ahead, there might be some problems of rupee appreciation, otherwise things look good."
TEJAS DOSHI, HEAD OF RESEARCH, SUSHIL FINANCE, MUMBAI
"Revenue growth looks pretty exciting. It looks like they have increased the bottom end of the earnings guidance and not the top end of the guidance. One of the reasons for that may be, the core business seems to have improved, but then the rupee dollar situation is not that conducive. So, may be on the bottom line we are not seeing much of a change."
VIKAS PERSHAD, CEO OF VEDA INVESTMENTS, CHICAGO
"I think, it does show that IT spending cycle is stronger than some believed. For the larger companies, given Infosys results, we may see similarly good results. I prefer Infosys over TCS and Wipro (WIPRO.NS : 479.5 -10.75) in the Indian IT space. All this said, we need to pay attention to the rupee appreciation."
SUBHASHINI GURUMURTHY, ANALYST, AMBIT CAPITAL, MUMBAI:
"The results are good and the guidance for the year also looks good. Hence, I have a buy on this stock."
"Infosys has already given two wage hikes to employees and hence, this aspect won't affect Infosys rest of the year."
GAJENDRA NAGPAL, CEO, UNICON FINANCIAL INTERMEDIARIES, NEW DELHI
"The results are better than market expectations. We are very pleased. They have raised the dollar revenue guidance. That means they are making inroads into new customers. I expect the market to respond positively."
K. K. MITAL, HEAD OF PORTFOLIO MANAGEMENT SERVICES, GLOBE CAPITAL, NEW DELHI
"The results are okay. The positives are the upward revision in full year guidance. After this, other IT companies are also expected to report in-line numbers. I think Infosys stock may rise post results, but profit booking is not ruled out."
Bangalore-based Infosys said today net profit for its second quarter ended Sept. 30 rose to 17.4 billion rupees ($395 million) from 15.4 billion rupees a year ago.
Brokerages polled by Reuters had forecast profit of 17.17 billion rupees for Infosys, which counts Goldman Sachs, BT Group and BP among its main clients.
Shares in Infosys rose 2 percent to an all-time high after the results but turned negative later.
COMMENTARY:
AMBAREESH BALIGA, VICE-PRESIDENT, KARVY STOCK BROKING, MUMBAI
"It is better than expectations, but there's nothing to be enthused about it. Rupee will play a spoil sport going forward. We don't expect a major bump up in the stock price.
"Billing rates are not going up for the sector although there's good growth in volumes. Also there's pressure from overhead expenses."
PRAKASH DIWAN, HEAD OF INSTITUTIONAL BUSINESS AT NETWORTH STOCK BROKING, MUMBAI
"I would not read much into the fall in stock price. The stock was pricing in most near-term positives. It had run up a lot on expectations and such a reaction is expected.
"Also, Infosys has had a history of beating its own guidance and street estimates. So, people do tend to factor in that before results"
NIRAJ DEWAN, DIRECTOR, QUANTUM SECURITIES, NEW DELHI:
"On the margins side there was some pressure but that is more because of the rupee dollar movement. If the rupee dollar appreciation continues, then there could be some disappointment in the current quarter in terms of margins. Attrition would be another challenge, as the rate of attrition was higher in this quarter than the last."
"The stock is pressured because it has already run up and the guidance they are giving is not towards the higher end, it is towards the lower end of expectations."
ROHIT ANAND, RESEARCH ANALYST, PINC RESEARCH, MUMBAI:
"In dollar terms the growth is good. Expecting a good set of numbers from other IT companies as well, especially the large caps. Going ahead, there might be some problems of rupee appreciation, otherwise things look good."
TEJAS DOSHI, HEAD OF RESEARCH, SUSHIL FINANCE, MUMBAI
"Revenue growth looks pretty exciting. It looks like they have increased the bottom end of the earnings guidance and not the top end of the guidance. One of the reasons for that may be, the core business seems to have improved, but then the rupee dollar situation is not that conducive. So, may be on the bottom line we are not seeing much of a change."
VIKAS PERSHAD, CEO OF VEDA INVESTMENTS, CHICAGO
"I think, it does show that IT spending cycle is stronger than some believed. For the larger companies, given Infosys results, we may see similarly good results. I prefer Infosys over TCS and Wipro (WIPRO.NS : 479.5 -10.75) in the Indian IT space. All this said, we need to pay attention to the rupee appreciation."
SUBHASHINI GURUMURTHY, ANALYST, AMBIT CAPITAL, MUMBAI:
"The results are good and the guidance for the year also looks good. Hence, I have a buy on this stock."
"Infosys has already given two wage hikes to employees and hence, this aspect won't affect Infosys rest of the year."
GAJENDRA NAGPAL, CEO, UNICON FINANCIAL INTERMEDIARIES, NEW DELHI
"The results are better than market expectations. We are very pleased. They have raised the dollar revenue guidance. That means they are making inroads into new customers. I expect the market to respond positively."
K. K. MITAL, HEAD OF PORTFOLIO MANAGEMENT SERVICES, GLOBE CAPITAL, NEW DELHI
"The results are okay. The positives are the upward revision in full year guidance. After this, other IT companies are also expected to report in-line numbers. I think Infosys stock may rise post results, but profit booking is not ruled out."
Wednesday, October 13, 2010
Sensex zooms up 484 points; biggest single day gain in six months
In the biggest single day gain in six months, stock market benchmark Sensex today moved up a whopping 484 points to hit 33-month high of 20,687 on record inflows from foreign funds and strong overseas sentiment. The Bombay Stock Exchange''s 30-share barometer closed the day 484.54 points, or 2.4 per cent, up at 20,687.88 -- its best closing since January 14, 2008, when the index had ended at 20,728.05.
The National Stock Exchange 50-share wide-based Nifty index too spurted by 2.31 per cent to close at 6,231.50. Intra-day, the Sensex had zoomed 500 points to hit a high of 20,703, just 500 points short of its highest close of 21,206.77 -- achieved on January 10, 2008.
Today''s gain was the highest rise in a single day, since May 10, 2010, when the Sensex had rallied by 561 points. India was the best performing market among Asian peers today.
The broad based rally was led by IT, capital goods and banking stocks. Investors continue to remain bullish on IT stocks ahead of Infosys results, brokers said.
It was IT sector that stole the show on the Dalal Street, with Infosys zooming 2.57 per cent ahead of September quarter result -- to be announced on October 15. TCS climbed about 5 per cent -- the most in Sensex pack -- and Wipro 3.69 per cent.
Investor sentiment was also upbeat after technology major Intel Corp beat the Wall Street forecast by reporting a 59 per cent jump in third quarter profit to USD 2.95 billion. Analysts said, the sentiment on Street turned buoyant on China''s positive trade data, rebound in Australia''s consumer confidence in October and expectations of further steps by the US Fed to bolster the economy.
Back home, attractive pricing of Coal India Ltd IPO also helped boost the sentiments. The government Tuesday set a price band of Rs 225 to Rs 245 a share for the country''s largest ever IPO (expected garner over Rs 15,000 crore) by state-run CIL. "The liquidity driven rally piggybacking poor IIP numbers is a strong indication of the underlying strength in markets," Consortium Securities AVP Vishwesh Choudhary said.
Inflows from overseas fund houses are about to cross the magical Rs 1,00,000 crore mark, the highest net investment in a single in year in Indian equities. As per market regulator Sebi data, FIIs have infused a whopping Rs 99,874 crore so far this year in Indian stock market.
Reliance Industries Ltd, that holds the maximum weight in the Sensex, surged 1.67 per cent to settle at Rs 1,071.50. Financial was another sector that attracted heavy buying, with HDFC zooming 4.47 per cent, HDFC Bank 2.52 per cent, SBI 2 per cent and ICICI Bank 1.23 per cent.
NTPC was the sole loser stock in the entire Sensex pack. The scrip ended with a loss of 0.88 per cent.
The National Stock Exchange 50-share wide-based Nifty index too spurted by 2.31 per cent to close at 6,231.50. Intra-day, the Sensex had zoomed 500 points to hit a high of 20,703, just 500 points short of its highest close of 21,206.77 -- achieved on January 10, 2008.
Today''s gain was the highest rise in a single day, since May 10, 2010, when the Sensex had rallied by 561 points. India was the best performing market among Asian peers today.
The broad based rally was led by IT, capital goods and banking stocks. Investors continue to remain bullish on IT stocks ahead of Infosys results, brokers said.
It was IT sector that stole the show on the Dalal Street, with Infosys zooming 2.57 per cent ahead of September quarter result -- to be announced on October 15. TCS climbed about 5 per cent -- the most in Sensex pack -- and Wipro 3.69 per cent.
Investor sentiment was also upbeat after technology major Intel Corp beat the Wall Street forecast by reporting a 59 per cent jump in third quarter profit to USD 2.95 billion. Analysts said, the sentiment on Street turned buoyant on China''s positive trade data, rebound in Australia''s consumer confidence in October and expectations of further steps by the US Fed to bolster the economy.
Back home, attractive pricing of Coal India Ltd IPO also helped boost the sentiments. The government Tuesday set a price band of Rs 225 to Rs 245 a share for the country''s largest ever IPO (expected garner over Rs 15,000 crore) by state-run CIL. "The liquidity driven rally piggybacking poor IIP numbers is a strong indication of the underlying strength in markets," Consortium Securities AVP Vishwesh Choudhary said.
Inflows from overseas fund houses are about to cross the magical Rs 1,00,000 crore mark, the highest net investment in a single in year in Indian equities. As per market regulator Sebi data, FIIs have infused a whopping Rs 99,874 crore so far this year in Indian stock market.
Reliance Industries Ltd, that holds the maximum weight in the Sensex, surged 1.67 per cent to settle at Rs 1,071.50. Financial was another sector that attracted heavy buying, with HDFC zooming 4.47 per cent, HDFC Bank 2.52 per cent, SBI 2 per cent and ICICI Bank 1.23 per cent.
NTPC was the sole loser stock in the entire Sensex pack. The scrip ended with a loss of 0.88 per cent.
Friday, September 17, 2010
BSE Sensex posts best weekly gain in 10 months
(Courtesy Reuters) - Brisk foreign fund inflows helped the BSE Sensex (^BSESN : 19594.75 +177.26) post its best weekly gain in 10 months to close 0.9 percent higher on Friday, led by Reliance Industries (RELIANCE.NS : 1027.35 +27), having tested new 32-month highs each day of the week.
Reliance Industries led the gainers, rising as much as 2.9 percent after a source said the energy major was in talks with U.S.-based Chesapeake Energy to buy a stake in Eagle Ford shale gas project. If a deal is struck, it would be the firm's fourth such buy this year.
Nine of the top 30 stocks scaled their all-time high this week, as the benchmark logged its third straight weekly gain. It rose 4.2 percent this week, its best weekly gain in 10 months.
Foreign funds have bought a net $15.4 billion in Indian equities so far in 2010, adding to their record $17.5 billion purchases last year. The inflows reaffirm investor faith in India's economic growth and corporate fundamentals, dealers said.
The BSE index rose 0.91 percent or 177.26 points to 19,594.75, with 24 of its components closing in the green.
"India's outperformance versus other emerging market peers, its strong economic growth and earnings growth forecast, makes it attractive," said Rakesh Rawal, head of private wealth management at Anand Rathi.
India's top-100 firms paid 381.07 billion rupees in advance taxes for July-Sept, a rise of 16.4 percent year-on-year, an official from the federal finance ministry said.
Its benchmark index has outperformed its peers in the BRIC region year-to-date with a 12.2 percent gain.
Brazil's Bovespa and China's Shanghai Composite Index are down 1.3 percent and 20.7 percent in 2010, while Russia's RTS index gained 2.2 percent.
Most emerging stock markets will finish 2010 with much stronger gains than their rich world counterparts, according to Reuters polls that showed only Japanese and Chinese bourses ending the year in double-digit slumps.
The BSE index is forecast to rise to 20,080 points by end-2010, then breach record high and hit 21,500 by mid-2011, according to median forecast of 21 market participants polled.
The country's focus on infrastructure investment will help drive growth in its stock market, Thomas Mathew, managing director of state-run Life Insurance Corporation, India's largest portfolio investor, told Reuters on earlier this week.
"Also, it is relatively less dependent on exports, as there is a robust domestic consumption story," said Anand Rathi's Rawal.
"There is ample amount of liquidity globally, with funds available at cheap cost right now. Economies like India, which have a proven track record, stand to benefit."
Reliance Industries, which has the highest weight on the main index, closed 2.6 percent higher at 1,026.75 rupees.
Top mobile operator Bharti Airtel (BHARTIARTL.BO : 357.9 +10.2) rose 2.9 percent to 357.90 rupees as Credit Suisse raised its price target on the stock to 415 rupees from 360 rupees and retained "outperform" rating.
Software majors recouped some of Thursday's losses, with the sector index edging 0.5 percent higher after shedding 2.3 percent in the previous session.
Leading outsourcers Tata Consultancy Services (TCS.NS : 913.8 +18.4) and Infosys Technologies (INFOSYS.BO : 2974.1 +6.3) firmed 1.9 percent and 0.2 percent respectively while Wipro (WIPRO.NS : 420.25 -3.2) bucked the trend and dropped 0.7 percent.
Financials fared mixed after a Reuters poll showed on Thursday, India still has one or two more interest rate increases in store for the rest of the fiscal year that ends in March 2011.
The poll was conducted after the central bank had raised rates on Thursday for a fifth time this year to tame inflation.
ICICI Bank (ICICIBANK.NS : 1114.2 +10.65) and HDFC Bank rose 1.1 percent and 0.2 percent respectively, while sector leader State Bank of India (SBIN.NS : 3092.75 -2.05) edged 0.2 percent lower.
In the broader market, gainers were 1.5 times the number of losers in a relatively better volume of 481 million shares.
The 50-share NSE (^NSEI : 5884.95 +56.25) index rose nearly 1 percent to 5,884.95 points.
Overall, the MSCI world equity index rose 0.5 percent by 1041 GMT, while the more volatile emerging markets index climbed 0.9 percent.
STOCKS THAT MOVED
* Jet Airways gained 0.6 percent to 759.40 rupees, after government data showed the carrier recorded highest market share among domestic carriers.
* Delta Corp rose 20 percent to 69.70 rupees, after the financial consultancy and advisory services firm's board said it will meet on Sept. 20 to consider raising 2.75 billion rupees through a preferential allotment.
* Elder Pharmaceuticals firmed 5.1 percent to 434.95 rupees after NeutraHealth, a UK-based supplier of vitamins and supplements, agreed to be acquired by the Indian drugmaker for about $19.1 million.
MAIN TOP 3 BY VOLUME
* Ispat Industries (NIPPONDEN.NS : 0 0) on 31.6 million shares
* Delta Corp on 10 million shares
* Shree Ashtavinayak on 9.6 million shares
Reliance Industries led the gainers, rising as much as 2.9 percent after a source said the energy major was in talks with U.S.-based Chesapeake Energy to buy a stake in Eagle Ford shale gas project. If a deal is struck, it would be the firm's fourth such buy this year.
Nine of the top 30 stocks scaled their all-time high this week, as the benchmark logged its third straight weekly gain. It rose 4.2 percent this week, its best weekly gain in 10 months.
Foreign funds have bought a net $15.4 billion in Indian equities so far in 2010, adding to their record $17.5 billion purchases last year. The inflows reaffirm investor faith in India's economic growth and corporate fundamentals, dealers said.
The BSE index rose 0.91 percent or 177.26 points to 19,594.75, with 24 of its components closing in the green.
"India's outperformance versus other emerging market peers, its strong economic growth and earnings growth forecast, makes it attractive," said Rakesh Rawal, head of private wealth management at Anand Rathi.
India's top-100 firms paid 381.07 billion rupees in advance taxes for July-Sept, a rise of 16.4 percent year-on-year, an official from the federal finance ministry said.
Its benchmark index has outperformed its peers in the BRIC region year-to-date with a 12.2 percent gain.
Brazil's Bovespa and China's Shanghai Composite Index are down 1.3 percent and 20.7 percent in 2010, while Russia's RTS index gained 2.2 percent.
Most emerging stock markets will finish 2010 with much stronger gains than their rich world counterparts, according to Reuters polls that showed only Japanese and Chinese bourses ending the year in double-digit slumps.
The BSE index is forecast to rise to 20,080 points by end-2010, then breach record high and hit 21,500 by mid-2011, according to median forecast of 21 market participants polled.
The country's focus on infrastructure investment will help drive growth in its stock market, Thomas Mathew, managing director of state-run Life Insurance Corporation, India's largest portfolio investor, told Reuters on earlier this week.
"Also, it is relatively less dependent on exports, as there is a robust domestic consumption story," said Anand Rathi's Rawal.
"There is ample amount of liquidity globally, with funds available at cheap cost right now. Economies like India, which have a proven track record, stand to benefit."
Reliance Industries, which has the highest weight on the main index, closed 2.6 percent higher at 1,026.75 rupees.
Top mobile operator Bharti Airtel (BHARTIARTL.BO : 357.9 +10.2) rose 2.9 percent to 357.90 rupees as Credit Suisse raised its price target on the stock to 415 rupees from 360 rupees and retained "outperform" rating.
Software majors recouped some of Thursday's losses, with the sector index edging 0.5 percent higher after shedding 2.3 percent in the previous session.
Leading outsourcers Tata Consultancy Services (TCS.NS : 913.8 +18.4) and Infosys Technologies (INFOSYS.BO : 2974.1 +6.3) firmed 1.9 percent and 0.2 percent respectively while Wipro (WIPRO.NS : 420.25 -3.2) bucked the trend and dropped 0.7 percent.
Financials fared mixed after a Reuters poll showed on Thursday, India still has one or two more interest rate increases in store for the rest of the fiscal year that ends in March 2011.
The poll was conducted after the central bank had raised rates on Thursday for a fifth time this year to tame inflation.
ICICI Bank (ICICIBANK.NS : 1114.2 +10.65) and HDFC Bank rose 1.1 percent and 0.2 percent respectively, while sector leader State Bank of India (SBIN.NS : 3092.75 -2.05) edged 0.2 percent lower.
In the broader market, gainers were 1.5 times the number of losers in a relatively better volume of 481 million shares.
The 50-share NSE (^NSEI : 5884.95 +56.25) index rose nearly 1 percent to 5,884.95 points.
Overall, the MSCI world equity index rose 0.5 percent by 1041 GMT, while the more volatile emerging markets index climbed 0.9 percent.
STOCKS THAT MOVED
* Jet Airways gained 0.6 percent to 759.40 rupees, after government data showed the carrier recorded highest market share among domestic carriers.
* Delta Corp rose 20 percent to 69.70 rupees, after the financial consultancy and advisory services firm's board said it will meet on Sept. 20 to consider raising 2.75 billion rupees through a preferential allotment.
* Elder Pharmaceuticals firmed 5.1 percent to 434.95 rupees after NeutraHealth, a UK-based supplier of vitamins and supplements, agreed to be acquired by the Indian drugmaker for about $19.1 million.
MAIN TOP 3 BY VOLUME
* Ispat Industries (NIPPONDEN.NS : 0 0) on 31.6 million shares
* Delta Corp on 10 million shares
* Shree Ashtavinayak on 9.6 million shares
Saturday, September 4, 2010
My first published book: "Deceivers" is now available for purchase online. Just click on the link:
http://www.pustakmahal.com/book/book/bid,,9553A/isbn:9788122311457/index.html
http://www.pustakmahal.com/book/book/bid,,9553A/isbn:9788122311457/index.html
Sunday, August 22, 2010
In a striking shift, small investors flee US stock markets
Courtesy:
Renewed economic uncertainty is testing Americans’ generation-long love affair with the stock market.
Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year, according to the Investment Company Institute, the mutual fund industry trade group. Now many are choosing investments they deem safer, like bonds.
If that pace continues, more money will be pulled out of these mutual funds in 2010 than in any year since the 1980s, with the exception of 2008, when the global financial crisis peaked.
Small investors are “losing their appetite for risk,” a Credit Suisse analyst, Doug Cliggott, said in a report to investors on Friday.
One of the phenomena of the last several decades has been the rise of the individual investor. As Americans have become more responsible for their own retirement, they have poured money into stocks with such faith that half of the country’s households now own shares directly or through mutual funds, which are by far the most popular way Americans invest in stocks. So the turnabout is striking.
So is the timing. After past recessions, ordinary investors have typically regained their enthusiasm for stocks, hoping to profit as the economy recovered. This time, even as corporate earnings have improved, Americans have become more guarded with their investments.
“At this stage in the economic cycle, $10 to $20 billion would normally be flowing into domestic equity funds” rather than the billions that are flowing out, said Brian K. Reid, chief economist of the investment institute. He added, “This is very unusual.”
The notion that stocks tend to be safe and profitable investments over time seems to have been dented in much the same way that a decline in home values and in job stability the last few years has altered Americans’ sense of financial security.
It may take many years before it is clear whether this becomes a long-term shift in psychology. After technology and dot-com shares crashed in the early 2000s, for example, investors were quick to re-enter the stock market. Yet bigger economic calamities like the Great Depression affected people’s attitudes toward money for decades.
For now, though, mixed economic data is presenting a picture of an economy that is recovering feebly from recession.
“For a lot of ordinary people, the economic recovery does not feel real,” said Loren Fox, a senior analyst at Strategic Insight, a New York research and data firm. “People are not going to rush toward the stock market on a sustained basis until they feel more confident of employment growth and the sustainability of the economic recovery.”
Renewed economic uncertainty is testing Americans’ generation-long love affair with the stock market.
Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year, according to the Investment Company Institute, the mutual fund industry trade group. Now many are choosing investments they deem safer, like bonds.
If that pace continues, more money will be pulled out of these mutual funds in 2010 than in any year since the 1980s, with the exception of 2008, when the global financial crisis peaked.
Small investors are “losing their appetite for risk,” a Credit Suisse analyst, Doug Cliggott, said in a report to investors on Friday.
One of the phenomena of the last several decades has been the rise of the individual investor. As Americans have become more responsible for their own retirement, they have poured money into stocks with such faith that half of the country’s households now own shares directly or through mutual funds, which are by far the most popular way Americans invest in stocks. So the turnabout is striking.
So is the timing. After past recessions, ordinary investors have typically regained their enthusiasm for stocks, hoping to profit as the economy recovered. This time, even as corporate earnings have improved, Americans have become more guarded with their investments.
“At this stage in the economic cycle, $10 to $20 billion would normally be flowing into domestic equity funds” rather than the billions that are flowing out, said Brian K. Reid, chief economist of the investment institute. He added, “This is very unusual.”
The notion that stocks tend to be safe and profitable investments over time seems to have been dented in much the same way that a decline in home values and in job stability the last few years has altered Americans’ sense of financial security.
It may take many years before it is clear whether this becomes a long-term shift in psychology. After technology and dot-com shares crashed in the early 2000s, for example, investors were quick to re-enter the stock market. Yet bigger economic calamities like the Great Depression affected people’s attitudes toward money for decades.
For now, though, mixed economic data is presenting a picture of an economy that is recovering feebly from recession.
“For a lot of ordinary people, the economic recovery does not feel real,” said Loren Fox, a senior analyst at Strategic Insight, a New York research and data firm. “People are not going to rush toward the stock market on a sustained basis until they feel more confident of employment growth and the sustainability of the economic recovery.”
Saturday, August 21, 2010
Saturday, August 14, 2010
Friday, August 13, 2010
Sunday, August 8, 2010
FIIs pour Rs 51,185 cr in stocks so far this year
Affirming their faith in the India growth story, foreign fund houses have parked Rs 51,185 crore ($11.1 billion) in domestic stock markets so far this year, more than half of their record investment made in 2009.
An analysis of the data available with the capital market regulator Sebi showed that overseas investors so far in the current year are net buyers of Rs 51,185 crore. They had made a record net purchase of Rs 83,000 crore last year.
Analysts believe that the inflow is expected to continue in coming days also, as India is considered as one of the most favorite destination for FIIs among emerging economies.
"Indian economy is doing well and FIIs are bullish about the domestic markets. Their investment is expected to increase in coming periods," Kotak Mutual Fund Head of Equities Krishna Sanghavi said.
In the past week alone they infused Rs 5,590 crore into local stocks, as per the Sebi data.
With this huge inflow, local markets recovered during the past week and the Sensex made its fresh 2010 highs. On a week- on-week basis, the Sensex went up by about 276 points, or 1.5 per cent, to close at 18,143.99.
In June and July, FIIs made a total net investment of Rs 27,125 crore.
FIIs play a significant role in domestic equity markets and their movement (inflow and outflow) causes fluctuation in benchmark indices.
FIIs had pumped in a record Rs 83,400 crore in 2009 into the domestic equities, but started exiting in early 2010. In January, they were net sellers of Rs 500 crore.
But from February, the scenario started changing and they were net buyers of Rs 1,216 crore. In April, FIIs were net purchaser of shares worth Rs 9,361 crore, after pumping in a whopping Rs 19,928 crore in March.
An analysis of the data available with the capital market regulator Sebi showed that overseas investors so far in the current year are net buyers of Rs 51,185 crore. They had made a record net purchase of Rs 83,000 crore last year.
Analysts believe that the inflow is expected to continue in coming days also, as India is considered as one of the most favorite destination for FIIs among emerging economies.
"Indian economy is doing well and FIIs are bullish about the domestic markets. Their investment is expected to increase in coming periods," Kotak Mutual Fund Head of Equities Krishna Sanghavi said.
In the past week alone they infused Rs 5,590 crore into local stocks, as per the Sebi data.
With this huge inflow, local markets recovered during the past week and the Sensex made its fresh 2010 highs. On a week- on-week basis, the Sensex went up by about 276 points, or 1.5 per cent, to close at 18,143.99.
In June and July, FIIs made a total net investment of Rs 27,125 crore.
FIIs play a significant role in domestic equity markets and their movement (inflow and outflow) causes fluctuation in benchmark indices.
FIIs had pumped in a record Rs 83,400 crore in 2009 into the domestic equities, but started exiting in early 2010. In January, they were net sellers of Rs 500 crore.
But from February, the scenario started changing and they were net buyers of Rs 1,216 crore. In April, FIIs were net purchaser of shares worth Rs 9,361 crore, after pumping in a whopping Rs 19,928 crore in March.
Friday, July 30, 2010
BPO, ITeS industry could grow to $225 billion by 2020
The time has come for the BPO and ITeS industry to increase its presence in tier-II and tier-III locations as the industry is poised to reach a size of $225 billion in 2020. The industry expects 40% growth from tier-II and tier-III cities, said Som Mittal, president, Nasscom at a media briefing during the Nasscom HR summit.
"Last year we have conducted a granular study in association with AT Kearney in identifying the next 43 locations for IT-BPO penetration as the 60% of the BPO growth is happening only in the 7 major cities in the country. The growth of key infrastructure like airports and roads are welcome signs in such places," he said.
As the offshoring customers are now becoming location agnostic, the building of BPO and ITeS delivery centres in non-major cities would progress at a much higher pace, he added. Mittal released a study on the job potential of the BPO and ITeS industry and stated that by 2020 the industry would be employing about 10 million people directly that in turn would provide 20 million indirect jobs.
The contribution of IT-BPO industry to organised sector employment has jumped from 5% in 2000-01 to 15% in 2005-06 with 58% of the workforce hailing from tier II and tier III cities. Interestingly, 56% employees are chief bread winners. On gender inclusivity, 37% of the workforce are women with 26% of them found to be the chief wage earners.
"Last year we have conducted a granular study in association with AT Kearney in identifying the next 43 locations for IT-BPO penetration as the 60% of the BPO growth is happening only in the 7 major cities in the country. The growth of key infrastructure like airports and roads are welcome signs in such places," he said.
As the offshoring customers are now becoming location agnostic, the building of BPO and ITeS delivery centres in non-major cities would progress at a much higher pace, he added. Mittal released a study on the job potential of the BPO and ITeS industry and stated that by 2020 the industry would be employing about 10 million people directly that in turn would provide 20 million indirect jobs.
The contribution of IT-BPO industry to organised sector employment has jumped from 5% in 2000-01 to 15% in 2005-06 with 58% of the workforce hailing from tier II and tier III cities. Interestingly, 56% employees are chief bread winners. On gender inclusivity, 37% of the workforce are women with 26% of them found to be the chief wage earners.
Tuesday, July 27, 2010
The other India growth story: rising donations
It isn't only global manufacturers who are enthused about India's impressive growth story. The country's fast growing gross domestic product and the burgeoning middle class, with rising disposable incomes, has an unusual player excited - the global non-government, non-profit organisations, or NGOs, as they are popularly known.
"India's fast economic growth makes it an attractive market for fund-raising," says Samit Aich, Executive Director, Greenpeace India. "We are roping in more and more activists, fundraisers and donors to expand our presence here."
Like Greenpeace, many global NGOs, such as Oxfam, Save The Children, Care and ActionAid, have begun their fund-raising programme in India recently though many of these organisations have been present here for more than four to six decades. Most of these organisations did not even have an India office till recently and operated here as the offshoot of their global parent.
They have begun setting up offices in the past two years because Indian regulations do not allow entities not registered in India to raise funds locally. Save The Children, a leading global not-for-profit body working for underprivileged children, for instance, has had ties with India since 1920s. It was, however, in 2008 that it set up its India office and only in May this year that India was accorded the status of a "strong" member in its global alliance.
"A pre-requisite for being a strong member is to raise funds of a certain level and have a certain number of dedicated donors," says Thomas Chandy, CEO, Save The Children. Chandy, who has earlier worked with companies such as Coca-Cola, says he currently has 50,000 donors and "we are adding 6,000 more every month".
This, indeed, is getting reflected in the agency's income. While in 2009-10, the funds grew 46 per cent to Rs 60 crore against the previous year, this year, Chandy hopes the income to grow 50 per cent to Rs 90 crore. "Everybody wants to tap into the 'happy story' unfolding in India," says Chandy.
Greenpeace, the organisation fighting for the cause of environment and climate change, has more than 100,000 Indian donors, who contributed around Rs 12-13 crore to its funds last year, and Aich hopes the income to rise at least 25-30 per cent this year. "In the past three months or so, we have been generating around Rs 1 crore a month."
Citing another reason for the shift in approach towards India, Nisha Agarwal, CEO, Oxfam India, says: "After the global economic crisis, fund-raising in the developed world has slowed a bit. Organisations are looking for newer avenues. India, with its growing affluence and influence, makes a natural choice." Oxfam has been present in India since the 50s. The India office, however, was set up only in September 2008. It currently has 30,000 donors and had a budget of Rs 90 crore in 2009-10. According to Oxfam India, 10 per cent of this was raised in India and they hope that this kitty to grow further this year.
Humanitarian agency Care, on the other hand, has had a registered office in India since 1950. However, even Care, according to Communications Manager Amelia Andrews Daniels, began "resource mobilisation programme as recently as a week ago". "We will have figures on our India budget to share next year," she has said.
Some industry insiders, however, say Indians still like to donate for traditional causes and do not easily dish out money for efforts they cannot relate with. "Philanthropic giving in India is an old tradition. Indians have traditionally been donating to religious places and causes and to several social causes such as setting up hospitals or dispensaries or giving money to the poor. Even now, more than 95 per cent of philanthropic charities go to programmes focused on these issues. The only difference is raising such funds is becoming more organised now," says Ravi Singh, CEO, World Wildlife Fund India.
Indians, he adds, still do not easily give money for activities such as conservation of animals. "Of the Rs 18 crore budget we had last year, a very small amount was raised in India," Singh says.
"India's fast economic growth makes it an attractive market for fund-raising," says Samit Aich, Executive Director, Greenpeace India. "We are roping in more and more activists, fundraisers and donors to expand our presence here."
Like Greenpeace, many global NGOs, such as Oxfam, Save The Children, Care and ActionAid, have begun their fund-raising programme in India recently though many of these organisations have been present here for more than four to six decades. Most of these organisations did not even have an India office till recently and operated here as the offshoot of their global parent.
They have begun setting up offices in the past two years because Indian regulations do not allow entities not registered in India to raise funds locally. Save The Children, a leading global not-for-profit body working for underprivileged children, for instance, has had ties with India since 1920s. It was, however, in 2008 that it set up its India office and only in May this year that India was accorded the status of a "strong" member in its global alliance.
"A pre-requisite for being a strong member is to raise funds of a certain level and have a certain number of dedicated donors," says Thomas Chandy, CEO, Save The Children. Chandy, who has earlier worked with companies such as Coca-Cola, says he currently has 50,000 donors and "we are adding 6,000 more every month".
This, indeed, is getting reflected in the agency's income. While in 2009-10, the funds grew 46 per cent to Rs 60 crore against the previous year, this year, Chandy hopes the income to grow 50 per cent to Rs 90 crore. "Everybody wants to tap into the 'happy story' unfolding in India," says Chandy.
Greenpeace, the organisation fighting for the cause of environment and climate change, has more than 100,000 Indian donors, who contributed around Rs 12-13 crore to its funds last year, and Aich hopes the income to rise at least 25-30 per cent this year. "In the past three months or so, we have been generating around Rs 1 crore a month."
Citing another reason for the shift in approach towards India, Nisha Agarwal, CEO, Oxfam India, says: "After the global economic crisis, fund-raising in the developed world has slowed a bit. Organisations are looking for newer avenues. India, with its growing affluence and influence, makes a natural choice." Oxfam has been present in India since the 50s. The India office, however, was set up only in September 2008. It currently has 30,000 donors and had a budget of Rs 90 crore in 2009-10. According to Oxfam India, 10 per cent of this was raised in India and they hope that this kitty to grow further this year.
Humanitarian agency Care, on the other hand, has had a registered office in India since 1950. However, even Care, according to Communications Manager Amelia Andrews Daniels, began "resource mobilisation programme as recently as a week ago". "We will have figures on our India budget to share next year," she has said.
Some industry insiders, however, say Indians still like to donate for traditional causes and do not easily dish out money for efforts they cannot relate with. "Philanthropic giving in India is an old tradition. Indians have traditionally been donating to religious places and causes and to several social causes such as setting up hospitals or dispensaries or giving money to the poor. Even now, more than 95 per cent of philanthropic charities go to programmes focused on these issues. The only difference is raising such funds is becoming more organised now," says Ravi Singh, CEO, World Wildlife Fund India.
Indians, he adds, still do not easily give money for activities such as conservation of animals. "Of the Rs 18 crore budget we had last year, a very small amount was raised in India," Singh says.
Tuesday, July 13, 2010
Infosys Q1 net falls 2.6 pct, lags forecast
Infosys Technologies Ltd, India's No. 2 software services exporter, lagged market estimates with a surprise 2.6 percent drop in quarterly profit as the European debt crisis and salary increases took shine off improving U.S. demand.
The Nasdaq-listed firm announced today that net profit in its fiscal first quarter ended June 30 fell to 14.9 billion rupees ($318 million).
A Reuters poll of brokerages had forecast a profit of 15.56 billion rupees for Bangalore-headquartered Infosys, which counts Goldman Sachs, BT Group and BP among its main clients.
Infosys, larger rival Tata Consultancy Services and third-ranked Wipro have all stepped up hiring and raised salaries as demand for outsourcing grows in an improving global economy.
But a debt crisis in Europe, the second-largest market for Indian outsourcers after the United States, has clouded the demand outlook from the continent, while a weaker euro crimps margins for the export-driven companies.
Infosys shares, valued at about $35 billion, hit a record high yesterday and are up 11 percent this year, outpacing the 7 percent rise in the sector index
The Nasdaq-listed firm announced today that net profit in its fiscal first quarter ended June 30 fell to 14.9 billion rupees ($318 million).
A Reuters poll of brokerages had forecast a profit of 15.56 billion rupees for Bangalore-headquartered Infosys, which counts Goldman Sachs, BT Group and BP among its main clients.
Infosys, larger rival Tata Consultancy Services and third-ranked Wipro have all stepped up hiring and raised salaries as demand for outsourcing grows in an improving global economy.
But a debt crisis in Europe, the second-largest market for Indian outsourcers after the United States, has clouded the demand outlook from the continent, while a weaker euro crimps margins for the export-driven companies.
Infosys shares, valued at about $35 billion, hit a record high yesterday and are up 11 percent this year, outpacing the 7 percent rise in the sector index
Saturday, July 10, 2010
Economists see U.S. recovery weakening - survey
The U.S. economy will lose steam as the year progresses but will not slide back into recession, even though unemployment is unlikely to fall significantly, according to a survey released on today.
The Blue Chip Economic Indicators survey of private forecasters found analysts increasingly glum about the outlook. They now see the economy expanding just 3.1 percent in 2010, down from 3.3 percent in the June poll.
They do not, however, envisage a renewed period of contraction, which has been widely debated in financial markets in recent weeks.
"Our panellists think talk of a double-dip recession is overblown absent a new, major shock," the group said in its report.
Some analysts worry such a disruption might come from Europe, where concerns about high debt levels have made the banking sector jittery about lending.
The report's findings highlight the risks of a sputtering recovery amid lingering softness in housing, suggesting the unemployment rate will end the year at 9.4 percent, barely down from the current 9.5 percent rate.
"For a second straight month the number of panellists that lowered their forecasts of nominal GDP growth and inflation exceeded those that raised their forecasts by a significant margin," the report said.
"In the past, such a development has often suggested further erosion in consensus forecasts during subsequent survey."
Along with more moderate growth, inflation is expected to remain extremely tame. Forecasters are looking for a 0.9 percent increase in prices for 2010 as a whole, the smallest rise since 1950.
The Blue Chip Economic Indicators survey of private forecasters found analysts increasingly glum about the outlook. They now see the economy expanding just 3.1 percent in 2010, down from 3.3 percent in the June poll.
They do not, however, envisage a renewed period of contraction, which has been widely debated in financial markets in recent weeks.
"Our panellists think talk of a double-dip recession is overblown absent a new, major shock," the group said in its report.
Some analysts worry such a disruption might come from Europe, where concerns about high debt levels have made the banking sector jittery about lending.
The report's findings highlight the risks of a sputtering recovery amid lingering softness in housing, suggesting the unemployment rate will end the year at 9.4 percent, barely down from the current 9.5 percent rate.
"For a second straight month the number of panellists that lowered their forecasts of nominal GDP growth and inflation exceeded those that raised their forecasts by a significant margin," the report said.
"In the past, such a development has often suggested further erosion in consensus forecasts during subsequent survey."
Along with more moderate growth, inflation is expected to remain extremely tame. Forecasters are looking for a 0.9 percent increase in prices for 2010 as a whole, the smallest rise since 1950.
Monday, June 28, 2010
Gold hovers near record highs as economic fears persist
Courtesy Reuters
Gold was set for its third successive daily rise in international markets today, supported by uncertainty over the resilience of the global economic recovery and by resurfacing geopolitical tensions with Iran.
Gold prices flirted with sessions highs as the euro came under renewed pressure to fall to a 1-1/2 year low against sterling and eased against the dollar, while euro zone government bonds rose as investors were unsettled by a fall on Wall Street and persistent concern about Europe's debt crisis.
"Really the big driver is investor perception, investor risk appetite and do we see any nervousness over the European (debt) issue," said Societe Generale analyst David Wilson.
"Sentiment is still quite brittle, so we can get intraday moves in either direction, but the longer gold stays above $1,250 and consolidates, the more likely we are for a leg up rather than a leg down," he said.
Spot gold rose $7.80 to $1,261.35 an ounce by 1415 GMT, having hit an all-time high of $1,264.90 an ounce last Monday. U.S. gold futures for August delivery rose $5.50 cents to $1,261.30 an ounce.
Adding to the bullish backdrop for gold were comments from U.S. intelligence officials that Iran has enough fissile material for two atomic bombs.
Gold came under modest pressure earlier in the day from a rise in the dollar as its traditional inverse relation to the greenback briefly reestablished itself, while the broader markets were largely unperturbed by the weekend's meeting of G20 leaders in Toronto.
SAFE HAVEN SWEEP
But flagging equities and the broad decline in the euro reinvigorated the safe-haven sweep into both the U.S. currency and gold, prompting the two to move in tandem.
"The underlying safe-haven concerns that have supported prices -- the economic environment, Europe's fiscal outlook and the longer-term prospects for inflation, remain," said David Moore, commodities strategist at Commonwealth Bank of Australia.
"The G20 hasn't had a significant impact on markets, and while concerns about Iran's nuclear capacity are nothing new, there seems to be additional clarity."
With this in mind, gold could rise further to surpass the June 21 record at $1,264.90 per ounce to touch $1,270, as bullish momentum is strong, according to Reuters technical analyst Wang Tao.
He noted the bulls were taking control, with prices in an ascending channel from a $1,224.30 low struck last Wednesday and sharp rises and mild falls.
Gold was little moved by data that showed U.S. consumer spending rose more than expected in May, even as savings touched their highest in eight months, while a measure of inflation showed fairly muted core price pressures.
However, a continued contraction in physical demand from traditional end-users could undermine gold, at least in the short-term, analysts said.
The head of the Bombay Bullion Association said on today that gold imports into top consumer India are likely to have fallen by 75 percent in June from 29.9 tonnes a year ago. Suresh Hundia, president of BBA, told Reuters this bearish estimate could be overly optimistic and the final figures could be lower than this.
"The numbers are so bad, nobody wants to share it this time," he said referring to the importing banks and trading agencies, which contribute their data to the trade body.
While consumer demand has been dampened by gold prices near record highs, concern about the stability of the wider financial markets has fed demand for gold-related investment vehicles.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust said its holdings remained unchanged at an all-time high at 1,316.177 tonnes.
Silver was up at $19.19 an ounce, from $19.04 late in New York on Friday, while in the platinum group metals complex, platinum rose 0.9 percent to $1,580.00 and palladium was up about 0.3 percent at $476.00.
Gold was set for its third successive daily rise in international markets today, supported by uncertainty over the resilience of the global economic recovery and by resurfacing geopolitical tensions with Iran.
Gold prices flirted with sessions highs as the euro came under renewed pressure to fall to a 1-1/2 year low against sterling and eased against the dollar, while euro zone government bonds rose as investors were unsettled by a fall on Wall Street and persistent concern about Europe's debt crisis.
"Really the big driver is investor perception, investor risk appetite and do we see any nervousness over the European (debt) issue," said Societe Generale analyst David Wilson.
"Sentiment is still quite brittle, so we can get intraday moves in either direction, but the longer gold stays above $1,250 and consolidates, the more likely we are for a leg up rather than a leg down," he said.
Spot gold rose $7.80 to $1,261.35 an ounce by 1415 GMT, having hit an all-time high of $1,264.90 an ounce last Monday. U.S. gold futures for August delivery rose $5.50 cents to $1,261.30 an ounce.
Adding to the bullish backdrop for gold were comments from U.S. intelligence officials that Iran has enough fissile material for two atomic bombs.
Gold came under modest pressure earlier in the day from a rise in the dollar as its traditional inverse relation to the greenback briefly reestablished itself, while the broader markets were largely unperturbed by the weekend's meeting of G20 leaders in Toronto.
SAFE HAVEN SWEEP
But flagging equities and the broad decline in the euro reinvigorated the safe-haven sweep into both the U.S. currency and gold, prompting the two to move in tandem.
"The underlying safe-haven concerns that have supported prices -- the economic environment, Europe's fiscal outlook and the longer-term prospects for inflation, remain," said David Moore, commodities strategist at Commonwealth Bank of Australia.
"The G20 hasn't had a significant impact on markets, and while concerns about Iran's nuclear capacity are nothing new, there seems to be additional clarity."
With this in mind, gold could rise further to surpass the June 21 record at $1,264.90 per ounce to touch $1,270, as bullish momentum is strong, according to Reuters technical analyst Wang Tao.
He noted the bulls were taking control, with prices in an ascending channel from a $1,224.30 low struck last Wednesday and sharp rises and mild falls.
Gold was little moved by data that showed U.S. consumer spending rose more than expected in May, even as savings touched their highest in eight months, while a measure of inflation showed fairly muted core price pressures.
However, a continued contraction in physical demand from traditional end-users could undermine gold, at least in the short-term, analysts said.
The head of the Bombay Bullion Association said on today that gold imports into top consumer India are likely to have fallen by 75 percent in June from 29.9 tonnes a year ago. Suresh Hundia, president of BBA, told Reuters this bearish estimate could be overly optimistic and the final figures could be lower than this.
"The numbers are so bad, nobody wants to share it this time," he said referring to the importing banks and trading agencies, which contribute their data to the trade body.
While consumer demand has been dampened by gold prices near record highs, concern about the stability of the wider financial markets has fed demand for gold-related investment vehicles.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust said its holdings remained unchanged at an all-time high at 1,316.177 tonnes.
Silver was up at $19.19 an ounce, from $19.04 late in New York on Friday, while in the platinum group metals complex, platinum rose 0.9 percent to $1,580.00 and palladium was up about 0.3 percent at $476.00.
Friday, June 18, 2010
Risk back in vogue for investors abroad
Investors set aside sovereign debt fears (defaults by countries) and shifted their money to higher-returning assets in mid-June, with emerging market assets and U.S. equities among the recipients of fresh cash, EPFR Global said in a report on today.
Wednesday, June 16, 2010
Sensex to touch 19.5k by 2010 - 2011 fiscal end, says LIC investment chief
Indian equities may be gyrating on fears of Europe's spreading contagion, but N Mohan Raj, executive director in charge of investments at LIC, India's largest fund manager, remains unfazed. "We will not be swayed by short term volatility. The valuation has cooled down a bit. Every dip is an opportunity to buy," he has said, as per a report in the Indian Express Finance.
Raj expects the market to touch 19,500-levels by the end of this fiscal, which translates into returns of about 15% from current levels. His optimism stems from the fact that India's economy continues to be on a firm footing notwithstanding the turmoil in developed economies. "Locally, we don't see any trigger other than the monsoon. A good monsoon will do a lot of good for the economy, help spur rural demand and keep the food inflation in check," he says.
That said, India is not fully immune to global headwinds. "Global cues will determine how much money is brought into India by foreign institutional investors (FIIs). FII flows might feed into the sentiments of domestic institutional investors as well," says Raj. In fact, there is a strong possibility that FII flows might reverse if the dollar continues to strengthen. According to Raj, currency gain is one of the key reasons foreign investors (from the dollar region) put in their monies in riskier emerging markets like India. "If that arbitrage shrinks they might look for an exit," he cautions.
Going forward, Raj reckons sectors such as infrastructure, banking and FMCG are set to do well in India. "A lot of money is set to pour into infrastructure. The government also seems to be serious about investing in this space," says Raj, adding that the importance of infrastructure for the development of the country cannot be overemphasised.
According to him, the fourth quarter earnings season has been better than expected. However, he warns that the next quarter might not be as cheerful. "Input costs have risen across sectors. Higher inputs costs will moderate earnings," he says.
LIC has invested to the tune of Rs 1,93,000 crore in FY10 in various asset classes, of which a little over Rs 61,000 crore was put into equity. It invested nearly Rs 8,400 crore in equities in the first two months of the current financial year, about seven times the amount it had invested during the corresponding period of the previous fiscal.
Traditionally, the fourth quarter of the financial year sees the maximum sale of insurance policies. "This is available for deployment in the next financial year,"said Raj.
Raj expects the market to touch 19,500-levels by the end of this fiscal, which translates into returns of about 15% from current levels. His optimism stems from the fact that India's economy continues to be on a firm footing notwithstanding the turmoil in developed economies. "Locally, we don't see any trigger other than the monsoon. A good monsoon will do a lot of good for the economy, help spur rural demand and keep the food inflation in check," he says.
That said, India is not fully immune to global headwinds. "Global cues will determine how much money is brought into India by foreign institutional investors (FIIs). FII flows might feed into the sentiments of domestic institutional investors as well," says Raj. In fact, there is a strong possibility that FII flows might reverse if the dollar continues to strengthen. According to Raj, currency gain is one of the key reasons foreign investors (from the dollar region) put in their monies in riskier emerging markets like India. "If that arbitrage shrinks they might look for an exit," he cautions.
Going forward, Raj reckons sectors such as infrastructure, banking and FMCG are set to do well in India. "A lot of money is set to pour into infrastructure. The government also seems to be serious about investing in this space," says Raj, adding that the importance of infrastructure for the development of the country cannot be overemphasised.
According to him, the fourth quarter earnings season has been better than expected. However, he warns that the next quarter might not be as cheerful. "Input costs have risen across sectors. Higher inputs costs will moderate earnings," he says.
LIC has invested to the tune of Rs 1,93,000 crore in FY10 in various asset classes, of which a little over Rs 61,000 crore was put into equity. It invested nearly Rs 8,400 crore in equities in the first two months of the current financial year, about seven times the amount it had invested during the corresponding period of the previous fiscal.
Traditionally, the fourth quarter of the financial year sees the maximum sale of insurance policies. "This is available for deployment in the next financial year,"said Raj.
Monday, June 7, 2010
India Inc prunes Q4 losses by 28.5%
India Inc has not only witnessed a surge in profits during the January-March 2010 period, but the number of loss-making companies has also been steadily declining, a study carried out by Financial Express has revealed.
The study, on a sample of 2,430 quoted companies (excluding banks and NBFCs), shows that around 668 firms (27.5%) made losses during January-March 2010. This is a 46.3% fall from the 1,243 companies that reported losses during the same period last year. During April-June 2009, the number dwindled to 897, to 828 during July-September 2009 and 747 during October-December 2009.
Moreover, even the quantum of losses has seen a slide. In terms of value, the loss has steadily decreased 28.5% to Rs 7,010 crore in January-March 2010 from the level of Rs 9,798 crore in January-March 2009.
Cumulative sales (of 668 loss-making companies) was Rs 35,384 crore in January-March 2010 against Rs 49,987 crore (of 1,243 companies) in January-March 2009.
The fortunes of India Inc improved during Q4 FY10 compared with Q4 FY09. Commodity companies led the pack with improved volumes and realisations. Interestingly, the number of companies incurring losses declined sharply during the same period. On delving deeper, the industries that outperfomed belonged to sectors like auto ancillaries, gems & jewellery, engineering, food processing, hotels, textile companies, among others. With improved economy and higher spending, domestic consumption grew, leading to better financials of many companies in these sectors.
During January-March 2010, the top five loss-making companies are MTNL, Suzlon Energy, Kingfisher Airlines, HFCL and Wockhardt (WOCKPHARM.NS : 127.2 -4.55). The loss of Kingfisher Airlines increased 3.2% to Rs 572 crore during January-March 2010 from Rs 554 crore during January-March 2009. During January-March 2009, the top five loss-making companies were Ranbaxy Labs, Kingfisher, Northgate Tech, Raymond and Hind Photo Films.
Among the industries studied, more than Rs 100 crore loss was registered during January-March 2010 in sectors like cement, IT, electric equipment, entertainment, pharmaceuticals, steel, sugar, tea, telecommunications, textiles and airlines.
On the other hand, during January-March 2009, 17 industries registered more than Rs 100 crore loss. These include automobiles and ancillaries, IT, construction, jems & jewellery, entertainment, fertilisers, pharmaceuticals, steel, telecommunications, textiles and airlines. Significant surge in losses was seen in cement, electrical equipment, shipping, sugar and telecommunications sectors. The loss of telecommunication companies leaped from Rs 681 crore during January-March 2009 to Rs 2,167 crore during January-March 2010.
A downward trend in loss was seen in aluminium, automobiles and ancilleries, IT, construction, jems & jewellery, electronics, engineering, entertainments, fertilisers, food products, hotels, pharmaceuticals, retail, steel, tea and textiles, among others.
The study, on a sample of 2,430 quoted companies (excluding banks and NBFCs), shows that around 668 firms (27.5%) made losses during January-March 2010. This is a 46.3% fall from the 1,243 companies that reported losses during the same period last year. During April-June 2009, the number dwindled to 897, to 828 during July-September 2009 and 747 during October-December 2009.
Moreover, even the quantum of losses has seen a slide. In terms of value, the loss has steadily decreased 28.5% to Rs 7,010 crore in January-March 2010 from the level of Rs 9,798 crore in January-March 2009.
Cumulative sales (of 668 loss-making companies) was Rs 35,384 crore in January-March 2010 against Rs 49,987 crore (of 1,243 companies) in January-March 2009.
The fortunes of India Inc improved during Q4 FY10 compared with Q4 FY09. Commodity companies led the pack with improved volumes and realisations. Interestingly, the number of companies incurring losses declined sharply during the same period. On delving deeper, the industries that outperfomed belonged to sectors like auto ancillaries, gems & jewellery, engineering, food processing, hotels, textile companies, among others. With improved economy and higher spending, domestic consumption grew, leading to better financials of many companies in these sectors.
During January-March 2010, the top five loss-making companies are MTNL, Suzlon Energy, Kingfisher Airlines, HFCL and Wockhardt (WOCKPHARM.NS : 127.2 -4.55). The loss of Kingfisher Airlines increased 3.2% to Rs 572 crore during January-March 2010 from Rs 554 crore during January-March 2009. During January-March 2009, the top five loss-making companies were Ranbaxy Labs, Kingfisher, Northgate Tech, Raymond and Hind Photo Films.
Among the industries studied, more than Rs 100 crore loss was registered during January-March 2010 in sectors like cement, IT, electric equipment, entertainment, pharmaceuticals, steel, sugar, tea, telecommunications, textiles and airlines.
On the other hand, during January-March 2009, 17 industries registered more than Rs 100 crore loss. These include automobiles and ancillaries, IT, construction, jems & jewellery, entertainment, fertilisers, pharmaceuticals, steel, telecommunications, textiles and airlines. Significant surge in losses was seen in cement, electrical equipment, shipping, sugar and telecommunications sectors. The loss of telecommunication companies leaped from Rs 681 crore during January-March 2009 to Rs 2,167 crore during January-March 2010.
A downward trend in loss was seen in aluminium, automobiles and ancilleries, IT, construction, jems & jewellery, electronics, engineering, entertainments, fertilisers, food products, hotels, pharmaceuticals, retail, steel, tea and textiles, among others.
Saturday, May 29, 2010
Europe taking good steps - IMF chief
Measures announced by European countries to tackle their fiscal woes are helpful steps, IMF chief Dominique Strauss-Kahn said on Thursday, adding that Europe's economy will be back on track soon.
Strauss-Kahn, who spoke after meeting with Peruvian President Alan Garcia, said the International Monetary Fund believes that Greece and Spain are making the right moves to tackle their economic problems, which have rattled global financial markets for weeks.
"Those countries in Europe having a fiscal problem are addressing this problem these days, along the measures that have been announced, and I do believe that they are going in the right direction," the IMF's managing director told a media conference in Lima.
"I think that we've got good reason to believe that everything will come back on track rather rapidly," he added.
Strauss-Kahn also said the U.S. economy should grow about 3 percent this year. Europe may post growth of between 1 percent and 1.5 percent, he said.
He told students at a Peruvian university that Europe faces problems of high debt loads and slow economic growth and mending the global economy depends on continued policy coordination by governments.
He said much of Asia and Latin America were growing well and had largely moved past the crisis, but advanced economies were still lagging a bit.
The French economist also said Peru's economy should expand between 5 and 7 percent this year, a forecast that could make it the fastest growing in Latin America.
But he said hard-charging Latin American economies like those of Peru and Brazil face risks from enormous capital inflows that could cause asset bubbles or overheating.
Doubts remain about a fragile global economic recovery and investors are pouring money into emerging economies as they look for yield outside of traditional markets, he said.
Strauss-Kahn, who spoke after meeting with Peruvian President Alan Garcia, said the International Monetary Fund believes that Greece and Spain are making the right moves to tackle their economic problems, which have rattled global financial markets for weeks.
"Those countries in Europe having a fiscal problem are addressing this problem these days, along the measures that have been announced, and I do believe that they are going in the right direction," the IMF's managing director told a media conference in Lima.
"I think that we've got good reason to believe that everything will come back on track rather rapidly," he added.
Strauss-Kahn also said the U.S. economy should grow about 3 percent this year. Europe may post growth of between 1 percent and 1.5 percent, he said.
He told students at a Peruvian university that Europe faces problems of high debt loads and slow economic growth and mending the global economy depends on continued policy coordination by governments.
He said much of Asia and Latin America were growing well and had largely moved past the crisis, but advanced economies were still lagging a bit.
The French economist also said Peru's economy should expand between 5 and 7 percent this year, a forecast that could make it the fastest growing in Latin America.
But he said hard-charging Latin American economies like those of Peru and Brazil face risks from enormous capital inflows that could cause asset bubbles or overheating.
Doubts remain about a fragile global economic recovery and investors are pouring money into emerging economies as they look for yield outside of traditional markets, he said.
Monday, May 24, 2010
Investors still hope for India reform after mixed year
Courtesy: Reuters
To its admirers, the ruling coalition led by Congress has had a good year -- sound fiscal policy to stave off a ruinous global credit crisis, fast growth and some tentative steps toward reforms.
Those are likely to be stressed by Prime Minister Manmohan Singh when he gives a news conference on today to mark the coalition's first year in office.
But to its critics, his government has floundered on inflation, struggled ineffectively against a Maoist insurgency, and managed its political allies so badly its substantial parliamentary majority dwindled, hurting its ability to pass pro-market legislation needed to sustain robust growth.
A sense of bullish self-confidence marked the Congress party-led coalition's handsome re-election victory last May, spurring hopes of firm governance and quick policy changes.
A slew of crises then undercut that electoral momentum, emboldened the opposition and weakened Congress's hold on allies.
What may be more important though is that many investors remain optimistic government eventually will take steps to open the insurance, banking and retail sectors to overseas players, and India has too much potential for them to ignore in any case.
Incremental progress on structural reforms is the best they can hope for in a country of more than a billion people and 20 official languages still emerging from a socialist past.
"We do not expect any radical implementation," said Shubhada Rao, chief economist of Yes Bank (YESBANK.NS : 270.4 +5) in Mumbai.
"But we want the government to progressively start thinking about opening up the economy cautiously. The government's reforms agenda is clearly outlined; what is needed is clarity on the road to implementation."
Last May's election gave Prime Minister Singh a freer hand, no longer relying on the communist parties that propped up his first term government.
GOOD MARKS FOR THE ECONOMY
Many investors wanted cuts in subsidies for fuel, fertiliser and food. They expected the government to move fast on removing supply bottlenecks blamed on state-controlled prices as well as poor roads and rail.
Instead, the coalition spent much of the year fighting political fires, from public anger over high prices to criticism over a growing Maoist insurgency and a high-profile ministerial resignation over a cricket funding scandal.
"The government should have been stronger, instead it moved from one bungle to another," said Paranjoy Guha Thakurta, a leading newspaper columnist writing about the country's political economy.
In March, Singh lost some of his key allies as he tried to push through a bill reserving parliamentary seats for women. The thinning majority sent jitters through Congress before it cobbled the numbers to defeat a parliamentary vote on high prices.
While many say the government's response to inflation, now running at an annual rate of nearly 10 percent, was the single biggest failure, its overall handing of the economy has been praised.
Car sales are up 40 percent year-on-year, industrial output grew by 10.4 percent in 2009-10 and consumer durables production surged by 30 percent in the last five months.
Recovering quicker than expected from the global crunch, India's economy is forecast to grow at more than 7 percent this year and nearly 9 percent in 2011.
The government has also moved to sell stakes in some state-run firms, worked on a new tax code and is moving to repair public finances. It has sold spectrum to telecoms firms, which is expected to bring much needed funds for the budget.
SUSTAINING GROWTH?
To sustain grown, investors will be looking to the prime minister to introduce policies to improve the country's dilapidated roads, ports and airports and allow India's large savings to be channelled into productive returns.
Analysts expect Singh to continue to support, but make slow progress on, bills that would liberalise insurance and banking and open up retail, which could resolve supply bottlenecks contributing to high inflation.
Another likely slow mover, given problems with Congress's allies, will be a nuclear liability bill needed to allow entry of U.S. atomic energy firms into India.
"Gradualism punctuated by political compulsions will probably remain the key mantra," Macquarie Research said in a new report that rated the governing United Progressive Aliance performance at an uninspiring six on a scale peaking at 10.
With 42 percent of Indians living on less than the poverty line of $1.25 a day, reforms have always been a political hot potato. Many farmers who receive subsidies for rice and wheat helped Congress win last year's election.
"There is a lack of consensus within the Congress party and it is now increasingly clear the Left was only an excuse for postponing many important decisions needed to accelerate growth," N.K. Singh, former finance secretary wrote in the Mint newspaper.
Despite lack of big-ticket reforms, foreign firms and investors are getting on with business undeterred. India's long-term potential is too compelling to ignore.
"India is a delectable emerging economic story that suffers an unfortunate - but legitimate -- discount because of its government's poor management and implementation," the Macquarie report said.
To its admirers, the ruling coalition led by Congress has had a good year -- sound fiscal policy to stave off a ruinous global credit crisis, fast growth and some tentative steps toward reforms.
Those are likely to be stressed by Prime Minister Manmohan Singh when he gives a news conference on today to mark the coalition's first year in office.
But to its critics, his government has floundered on inflation, struggled ineffectively against a Maoist insurgency, and managed its political allies so badly its substantial parliamentary majority dwindled, hurting its ability to pass pro-market legislation needed to sustain robust growth.
A sense of bullish self-confidence marked the Congress party-led coalition's handsome re-election victory last May, spurring hopes of firm governance and quick policy changes.
A slew of crises then undercut that electoral momentum, emboldened the opposition and weakened Congress's hold on allies.
What may be more important though is that many investors remain optimistic government eventually will take steps to open the insurance, banking and retail sectors to overseas players, and India has too much potential for them to ignore in any case.
Incremental progress on structural reforms is the best they can hope for in a country of more than a billion people and 20 official languages still emerging from a socialist past.
"We do not expect any radical implementation," said Shubhada Rao, chief economist of Yes Bank (YESBANK.NS : 270.4 +5) in Mumbai.
"But we want the government to progressively start thinking about opening up the economy cautiously. The government's reforms agenda is clearly outlined; what is needed is clarity on the road to implementation."
Last May's election gave Prime Minister Singh a freer hand, no longer relying on the communist parties that propped up his first term government.
GOOD MARKS FOR THE ECONOMY
Many investors wanted cuts in subsidies for fuel, fertiliser and food. They expected the government to move fast on removing supply bottlenecks blamed on state-controlled prices as well as poor roads and rail.
Instead, the coalition spent much of the year fighting political fires, from public anger over high prices to criticism over a growing Maoist insurgency and a high-profile ministerial resignation over a cricket funding scandal.
"The government should have been stronger, instead it moved from one bungle to another," said Paranjoy Guha Thakurta, a leading newspaper columnist writing about the country's political economy.
In March, Singh lost some of his key allies as he tried to push through a bill reserving parliamentary seats for women. The thinning majority sent jitters through Congress before it cobbled the numbers to defeat a parliamentary vote on high prices.
While many say the government's response to inflation, now running at an annual rate of nearly 10 percent, was the single biggest failure, its overall handing of the economy has been praised.
Car sales are up 40 percent year-on-year, industrial output grew by 10.4 percent in 2009-10 and consumer durables production surged by 30 percent in the last five months.
Recovering quicker than expected from the global crunch, India's economy is forecast to grow at more than 7 percent this year and nearly 9 percent in 2011.
The government has also moved to sell stakes in some state-run firms, worked on a new tax code and is moving to repair public finances. It has sold spectrum to telecoms firms, which is expected to bring much needed funds for the budget.
SUSTAINING GROWTH?
To sustain grown, investors will be looking to the prime minister to introduce policies to improve the country's dilapidated roads, ports and airports and allow India's large savings to be channelled into productive returns.
Analysts expect Singh to continue to support, but make slow progress on, bills that would liberalise insurance and banking and open up retail, which could resolve supply bottlenecks contributing to high inflation.
Another likely slow mover, given problems with Congress's allies, will be a nuclear liability bill needed to allow entry of U.S. atomic energy firms into India.
"Gradualism punctuated by political compulsions will probably remain the key mantra," Macquarie Research said in a new report that rated the governing United Progressive Aliance performance at an uninspiring six on a scale peaking at 10.
With 42 percent of Indians living on less than the poverty line of $1.25 a day, reforms have always been a political hot potato. Many farmers who receive subsidies for rice and wheat helped Congress win last year's election.
"There is a lack of consensus within the Congress party and it is now increasingly clear the Left was only an excuse for postponing many important decisions needed to accelerate growth," N.K. Singh, former finance secretary wrote in the Mint newspaper.
Despite lack of big-ticket reforms, foreign firms and investors are getting on with business undeterred. India's long-term potential is too compelling to ignore.
"India is a delectable emerging economic story that suffers an unfortunate - but legitimate -- discount because of its government's poor management and implementation," the Macquarie report said.
Sunday, May 16, 2010
Indian economy to grow by 8.5%: CII
Industry chamber CII has projected the Indian economy to expand by up to 8.5 per cent in the current fiscal from estimated 7.2 per cent in 2009-10, but called for greater reforms, particularly in the financial sector, to push growth to double digits.
"CII estimates GDP growth at 8-8.5 per cent in 2010-11 ...A recovery in agriculture is likely in the coming years leading to upside in GDP growth; Industry and services to remain strong as capacity expansion takes place to take advantage of the rising demand," Confederation of Indian Industry President Hari S Bhartia said.
Bhartia further said that the industry is estimated to grow by 8.5 to 9 per cent, services by 9.3 to 9.5 per cent and agriculture by 2 to 3.5 per cent this fiscal.
"CII estimates GDP growth at 8-8.5 per cent in 2010-11 ...A recovery in agriculture is likely in the coming years leading to upside in GDP growth; Industry and services to remain strong as capacity expansion takes place to take advantage of the rising demand," Confederation of Indian Industry President Hari S Bhartia said.
Bhartia further said that the industry is estimated to grow by 8.5 to 9 per cent, services by 9.3 to 9.5 per cent and agriculture by 2 to 3.5 per cent this fiscal.
Thursday, May 13, 2010
Sara Lee selling stake in Godrej Sara Lee JV
The San Francisco based Sara Lee Corp announced yesterday that it would sell its 51 percent stake in Godrej Sara Lee Ltd joint venture, which markets insecticides in India, to Godrej Consumer Products Ltd for 185 million euros. Godrej is one of the largest marketers of consumer soap in India.
The transaction is expected to close by July 3, Sara Lee said in a statement.
The joint venture's revenue was around 7.5 billion Indian rupees ($158 million based on exchange rates in 2009) in fiscal 2009, Sara Lee said.
That business accounts for some 9 percent of the adjusted operating segment income for Sara Lee's International Household and Body Care business, Sara Lee said.
Sara Lee, whose businesses include Hillshire Farm lunchmeats and Sara Lee bread, has been focusing on its main food and beverage businesses as it remakes its portfolio.
It is slated to sell its European body-care business to Unilever and parts of its Ambi Pur air freshener business to Procter & Gamble Co.
The transaction is expected to close by July 3, Sara Lee said in a statement.
The joint venture's revenue was around 7.5 billion Indian rupees ($158 million based on exchange rates in 2009) in fiscal 2009, Sara Lee said.
That business accounts for some 9 percent of the adjusted operating segment income for Sara Lee's International Household and Body Care business, Sara Lee said.
Sara Lee, whose businesses include Hillshire Farm lunchmeats and Sara Lee bread, has been focusing on its main food and beverage businesses as it remakes its portfolio.
It is slated to sell its European body-care business to Unilever and parts of its Ambi Pur air freshener business to Procter & Gamble Co.
Tuesday, May 4, 2010
I have just returned from a week's stay in Alpbach
I have just returned from a week's stay in Alpbach - a lovely village in Tyrol, Austria. I had gone to attend a conference.
Wednesday, March 31, 2010
POLL - MFs see stocks rising; eye financials, energy
Indian shares, which touched a 25-month high on Monday, could rise further in the June quarter with financials and energy stocks finding favour among domestic fund managers, a Reuters poll has shown.
Five of the nine respondents to a Reuters Asset Allocation Poll conducted between March 23 and March 30 said India's benchmark stock index could rise further in the next three months. Two said the index could rise more than 5 percent.
Foreign funds have pumped around $3.9 billion in Indian shares this year, most of it in March, helping the BSE Sensex rise by about 7 percent in the current month.
"The (FII) flows are too strong, there is risk appetite and the concerns regarding sovereign debt are not so high," said David Pezarkar, head of equity at Shinsei's Indian mutual fund unit.
"There will be bouts - but I don't think that is going to change the underlying trend."
Five fund managers said the BSE Sensex, which currently trades at one-year forward price to earnings multiple of around 17 times, is fairly valued, while three said it was overvalued.
Four fund managers said they would decrease the cash levels in their portfolios, whereas three said they would sell equities.
Overall, nearly 7 percent of assets under India's equity diversified funds were held as cash at February end, data from fund tracker ICRA Online showed.
Though five managers are of the view that market would continue its northward journey, some believe it could fall in the next quarter.
A further rise in the equity markets could give way to profit booking opportunities, Tridib Pathak, director equity at IDFC Asset Management, said.
SECTORAL PICKS
Most fund managers are optimistic about the financial services space, which accounted for 18 percent of diversified equity fund assets in February, their biggest sectoral bet.
Six respondents said they would scale up exposure in the sector while two said they would maintain their current exposure.
The Reserve Bank of India (RBI) surprised markets by raising its key lending and borrowing rates by 25 bps on March 19. However, bankers said last week that Indian banks see stable lending rates and profits in the near term despite RBI's recent move.
The energy sector, which is the second most preferred space, would also be in focus with five fund managers looking at further increasing their allocation.
A recovering Indian economy might also prompt money managers to raise exposure to basic engineering sector, which controlled more than one tenth of diversified equity assets in February.
Five fund managers said they would increase investments in the sector while four would retain exposure, the poll showed.
Three of the poll respondents said they would increase their allocation to shares of construction companies, while four said they would maintain their holdings.
If targets have to be met, the country would require accelerated spending on infrastructure, which should benefit the construction space, said Sanjay Sinha, chief executive at L&T Mutual Fund.
"The outlook for the 12th five year plan to spend $1 trillion on infrastructure is an even bigger space," he added.
However, autos, consumer non-durables and healthcare stocks could face some selling pressure in the next three months, the poll showed.
Balanced fund managers, those who invest in both stocks and bonds, are also looking at reducing their allocation to cash.
Five of the nine respondents to a Reuters Asset Allocation Poll conducted between March 23 and March 30 said India's benchmark stock index could rise further in the next three months. Two said the index could rise more than 5 percent.
Foreign funds have pumped around $3.9 billion in Indian shares this year, most of it in March, helping the BSE Sensex rise by about 7 percent in the current month.
"The (FII) flows are too strong, there is risk appetite and the concerns regarding sovereign debt are not so high," said David Pezarkar, head of equity at Shinsei's Indian mutual fund unit.
"There will be bouts - but I don't think that is going to change the underlying trend."
Five fund managers said the BSE Sensex, which currently trades at one-year forward price to earnings multiple of around 17 times, is fairly valued, while three said it was overvalued.
Four fund managers said they would decrease the cash levels in their portfolios, whereas three said they would sell equities.
Overall, nearly 7 percent of assets under India's equity diversified funds were held as cash at February end, data from fund tracker ICRA Online showed.
Though five managers are of the view that market would continue its northward journey, some believe it could fall in the next quarter.
A further rise in the equity markets could give way to profit booking opportunities, Tridib Pathak, director equity at IDFC Asset Management, said.
SECTORAL PICKS
Most fund managers are optimistic about the financial services space, which accounted for 18 percent of diversified equity fund assets in February, their biggest sectoral bet.
Six respondents said they would scale up exposure in the sector while two said they would maintain their current exposure.
The Reserve Bank of India (RBI) surprised markets by raising its key lending and borrowing rates by 25 bps on March 19. However, bankers said last week that Indian banks see stable lending rates and profits in the near term despite RBI's recent move.
The energy sector, which is the second most preferred space, would also be in focus with five fund managers looking at further increasing their allocation.
A recovering Indian economy might also prompt money managers to raise exposure to basic engineering sector, which controlled more than one tenth of diversified equity assets in February.
Five fund managers said they would increase investments in the sector while four would retain exposure, the poll showed.
Three of the poll respondents said they would increase their allocation to shares of construction companies, while four said they would maintain their holdings.
If targets have to be met, the country would require accelerated spending on infrastructure, which should benefit the construction space, said Sanjay Sinha, chief executive at L&T Mutual Fund.
"The outlook for the 12th five year plan to spend $1 trillion on infrastructure is an even bigger space," he added.
However, autos, consumer non-durables and healthcare stocks could face some selling pressure in the next three months, the poll showed.
Balanced fund managers, those who invest in both stocks and bonds, are also looking at reducing their allocation to cash.
Monday, March 1, 2010
Feb manufacturing growth at 20-month high - PMI
India's manufacturing industry in February grew at its fastest pace in 20 months, expanding for the third month thanks to expanding output and new orders, a survey showed.
The HSBC Purchasing Managers' Index (PMI), based on a survey of 500 companies, rose to 58.5 in February, its strongest reading since June 2008, from 57.7 in January.
A reading above 50 means activity is expanding.
"At 58.5, the headline index is consistent with ongoing double-digit gains in industrial production which in turn is likely to mean that spare capacity is being eaten into rapidly," said Robert Prior-Wandesforde, Senior Asian Economist at HSBC.
"Although the output prices balance surprisingly dropped back in February, while remaining consistent with price gains, there is more and more evidence of emerging supply-side constraints in labour and product markets."
The new orders index rose to 64.0 from January's 62.9.
"While new export orders grew less strongly in February than January this didn't prevent the overall new orders series from hitting a high in the current upturn," said Prior-Wandesforde. "The same was also true of output growth, which has rarely shown such strength since the series began in April 2005."
In the 2010/11 federal budget released on Friday, the government said it expected Asia's third-biggest economy to grow faster than the 7.2 percent it forecast for this fiscal year ending on March 31. It sees growth accelerating to 8.5 percent in the 2010/11 fiscal year.
The HSBC Purchasing Managers' Index (PMI), based on a survey of 500 companies, rose to 58.5 in February, its strongest reading since June 2008, from 57.7 in January.
A reading above 50 means activity is expanding.
"At 58.5, the headline index is consistent with ongoing double-digit gains in industrial production which in turn is likely to mean that spare capacity is being eaten into rapidly," said Robert Prior-Wandesforde, Senior Asian Economist at HSBC.
"Although the output prices balance surprisingly dropped back in February, while remaining consistent with price gains, there is more and more evidence of emerging supply-side constraints in labour and product markets."
The new orders index rose to 64.0 from January's 62.9.
"While new export orders grew less strongly in February than January this didn't prevent the overall new orders series from hitting a high in the current upturn," said Prior-Wandesforde. "The same was also true of output growth, which has rarely shown such strength since the series began in April 2005."
In the 2010/11 federal budget released on Friday, the government said it expected Asia's third-biggest economy to grow faster than the 7.2 percent it forecast for this fiscal year ending on March 31. It sees growth accelerating to 8.5 percent in the 2010/11 fiscal year.
Friday, February 26, 2010
A positive and individual friendly budget!
The Union Budget 2010 presented by our Finance Minster Pranab Mukerjee has been received positively by the stock market investors. This is evident from the sharp jump in the indices - Sensex and Nifty.
The Biggest Positive
By far the most attractive thing in the Budget 2010 for individuals is the increase in the income tax slab limits. Though the entry level slab for income tax has not been changed from Rs.1.6 lakhs, there is a considerable jump in the other slabs.
The new proposed slabs for the personal income tax are:
10% - Between Rs.1.6 lakhs and 5 lakhs
20% - Between Rs.5 lakhs and 8 lakhs
30% - Above 8 lakhs
As per the words of the Finance Minister, this proposal will bring relief to about 40% of the current tax payers.
Infrastructure Bonds are Back
Rs.20,000/- has been introduced as the additional limit for investment in Infrastructure Bonds. Infrastructure Bonds are thus making a comeback after 5 years as a savings option for tax savers. This will also reduce the tax burden for a few who are interested in traditional savings tools. This Rs.20,000/- will be over and above the current limit of Rs.1,00,000/- in various tax saving schemes.
New Pension Scheme Push
A renewed push has been given to the New Pension Scheme in this Budget. Till now the New Pension Scheme has not found much favour from the common public due to typical teething problems related to its implementation.
Our Finance Minister has proposed to give Rs.1000/- as a starting incentive to all Accounts of NPS opening in the next 3 years. This is a welcome measure, as the NPS is as of now the key Contributory Social Security Scheme in India.
Housing Interest Rate
The Finance Minister has said that the Interest Support of 1% for low cost housing loans will be extended for the next year too. This is a boon for the builders of townships and also the aam aadmi of India who could not afford costly houses. This is a direct form of supporting the recovery of the economy itself.
Support for Rural People
Agriculturists and people livings in rural India can have a breath of relief. The farm loans have been given an extension of 6 months.
Not only that, new loans will be getting a Government support of 2% reduction in interest rates. Effectively this brings down the farm interest rate to 5%. The earlier support was limited to only 1%.
The rural communities in non-arable areas get support from the continuation of the Mahatma Gandhi National Rural Employment Guarantee Scheme. The budget has allotted Rs.40,000/- crores for this scheme, which is now being implemented across the country.
Micro-Finance Support
Recognizing the major change in development brought about by micro-finance companies in India, the Finance Minister has proposed a Micro-Finance Development Fund to support Micro Finance Companies. At Rs.400 crores, the fund size is small but being with right intention, the gesture is one in the right direction.
Banks Loans
Rs.16,500 crores has been budgeted for providing the Tier I capital required for some PSU banks. This will improve the lending capacity of these banks. The Budget 2010 has also made additional provisions of capital for lending to Rural Areas.
These measures will not only stabilize banks but also provide the much needed muscle to improve the loan portfolio of PSU banks.
Additional licenses are being planned for private banks. NBFCs will also get a chance to open banks. The modalities will be discussed in detail shortly.
Overall: An Individual Friendly Budget
Based on the above concessions and support for lending and investments, we can conclude that Budget 2010 is very much friendly for the individuals of India. The salaried class may rejoice in their tax out goes coming down in a big way. The Rural Population can cheer over their cash outflows coming down and/or postponed. Banks, housing developers and those buying low cost houses can be happy with the 1% interest support
The Biggest Positive
By far the most attractive thing in the Budget 2010 for individuals is the increase in the income tax slab limits. Though the entry level slab for income tax has not been changed from Rs.1.6 lakhs, there is a considerable jump in the other slabs.
The new proposed slabs for the personal income tax are:
10% - Between Rs.1.6 lakhs and 5 lakhs
20% - Between Rs.5 lakhs and 8 lakhs
30% - Above 8 lakhs
As per the words of the Finance Minister, this proposal will bring relief to about 40% of the current tax payers.
Infrastructure Bonds are Back
Rs.20,000/- has been introduced as the additional limit for investment in Infrastructure Bonds. Infrastructure Bonds are thus making a comeback after 5 years as a savings option for tax savers. This will also reduce the tax burden for a few who are interested in traditional savings tools. This Rs.20,000/- will be over and above the current limit of Rs.1,00,000/- in various tax saving schemes.
New Pension Scheme Push
A renewed push has been given to the New Pension Scheme in this Budget. Till now the New Pension Scheme has not found much favour from the common public due to typical teething problems related to its implementation.
Our Finance Minister has proposed to give Rs.1000/- as a starting incentive to all Accounts of NPS opening in the next 3 years. This is a welcome measure, as the NPS is as of now the key Contributory Social Security Scheme in India.
Housing Interest Rate
The Finance Minister has said that the Interest Support of 1% for low cost housing loans will be extended for the next year too. This is a boon for the builders of townships and also the aam aadmi of India who could not afford costly houses. This is a direct form of supporting the recovery of the economy itself.
Support for Rural People
Agriculturists and people livings in rural India can have a breath of relief. The farm loans have been given an extension of 6 months.
Not only that, new loans will be getting a Government support of 2% reduction in interest rates. Effectively this brings down the farm interest rate to 5%. The earlier support was limited to only 1%.
The rural communities in non-arable areas get support from the continuation of the Mahatma Gandhi National Rural Employment Guarantee Scheme. The budget has allotted Rs.40,000/- crores for this scheme, which is now being implemented across the country.
Micro-Finance Support
Recognizing the major change in development brought about by micro-finance companies in India, the Finance Minister has proposed a Micro-Finance Development Fund to support Micro Finance Companies. At Rs.400 crores, the fund size is small but being with right intention, the gesture is one in the right direction.
Banks Loans
Rs.16,500 crores has been budgeted for providing the Tier I capital required for some PSU banks. This will improve the lending capacity of these banks. The Budget 2010 has also made additional provisions of capital for lending to Rural Areas.
These measures will not only stabilize banks but also provide the much needed muscle to improve the loan portfolio of PSU banks.
Additional licenses are being planned for private banks. NBFCs will also get a chance to open banks. The modalities will be discussed in detail shortly.
Overall: An Individual Friendly Budget
Based on the above concessions and support for lending and investments, we can conclude that Budget 2010 is very much friendly for the individuals of India. The salaried class may rejoice in their tax out goes coming down in a big way. The Rural Population can cheer over their cash outflows coming down and/or postponed. Banks, housing developers and those buying low cost houses can be happy with the 1% interest support
Instant view: Budget proposals
India needs to review public spending and improve its fiscal position, Finance Minister Pranab Mukherjee said today, kicking-off the presentation of his budget for the fiscal year that starts on April 1.
Key Points:
# Need to review stimulus
# Challenge to return to 9 pct growth, then double-digit
# Economy now in far better position than a year ago
# Final FY10 GDP figure maybe higher than estimate of 7.2 pct
# Fiscal deficit seen at 6.9 pct of GDP in 2009/10
# Fiscal deficit seen at 5.5 pct of GDP in 2010/11 (Reuters poll 5.6 pct)
# Fiscal deficit seen at 4.8 pct of GDP in 2011/12; 4.1 pct in 2012/13
# Total expenditure in 2010/11 11.87 trillion rupees ($256.75 billion)
# 2009/10 revised estimate for tax collection 7.47 trillion rupees ($161.58 billion)
Key Points:
# Need to review stimulus
# Challenge to return to 9 pct growth, then double-digit
# Economy now in far better position than a year ago
# Final FY10 GDP figure maybe higher than estimate of 7.2 pct
# Fiscal deficit seen at 6.9 pct of GDP in 2009/10
# Fiscal deficit seen at 5.5 pct of GDP in 2010/11 (Reuters poll 5.6 pct)
# Fiscal deficit seen at 4.8 pct of GDP in 2011/12; 4.1 pct in 2012/13
# Total expenditure in 2010/11 11.87 trillion rupees ($256.75 billion)
# 2009/10 revised estimate for tax collection 7.47 trillion rupees ($161.58 billion)
Wednesday, February 24, 2010
No fare hikes, 52 new trains announced in India's rail budget
Passengers were spared a fare hike, freight rates were lowered for some essential items and 52 new trains announced in India's rail budget for 2010-11 that promises a new model to promote private investment in expanding the world's second largest railroad network under a single management.
'We have saved Rs.2,000 crore ($40 million) because of the hard work of our employees and austerity measures. There will be no increase in passenger fares,' Railway Minister Mamata Banerjee told the Lok Sabha, the lower house of Parliament.
'Our objective is inclusive growth,' she said in her marathon 110-minute speech, adding that her main consideration was social responsibility of Indian Railways rather than mere commercial viability of various projects.
Accordingly, she also announced a cut in freight tariff for kerosene and grain, upgrade of 94 stations, 522 diagnostic centres, target of 1,000 km new lines, 10 auto ancillary hubs, several high-speed passenger rail corridors, six new drinking water plants and housing for all railway staff in 10 years.
'We have set our goals in the Vision 2020 document and we will achieve it,' the minister said, referring to the document unveiled in December that has targeted making over 30,000 km of routes into double or multiple lines against 18,000 km today.
'It is a fact that administrative and procedural delays discourage potential investors. We will need to overcome this. I am setting up a special task force for this,' said the minister, dressed in a white and green sari and her trademark rubber slippers.
'Special structure will be created for the new business model,' she said, emphasising: 'But we will not privatise railways. Indian Railways will remain with the government.'
At the same time, she also asked the private sector to refrain from what she called the 'typical negative approach' while dealing with the Indian Railways. 'I am sorry to say this -- this mindset has to change.'
She, nevertheless, said a special task force will be set up to clear proposals for investments within 100 days and that policy guidelines in this regard will be made easy, simple and investment friendly to attract funds to the sector.
Prime Minister Manmohan Singh, United Progressive Alliance (UPA) chairperson Sonia Gandhi, Leader of Opposition Sushma Swaraj and Finance Minister Pranab Mukherjee were among those in the house, presided over by Speaker Meira Kumar.
This was Banerjee's fourth budget of her career as railway minister and the second for the United Progressive Alliance (UPA) government in its second straight term after being voted back to office in May last year.
According to Banerjee, 117 out of the 122 new trains promised in her last budget will be flagged off by March 31, within a matter of seven months, which was a commendable effort.
Seeking to give safety issues due consideration, the minister said there were a few cases of unfortunate accidents in the past and said these would be prevented by adopting the highest level of technology and manpower training.
'Within five years, we will have 13,000 out of unmanned level crossings manned - 3,000 this fiscal and 1,000 in the coming fiscal,' she said, referring to the high number of accidents at such crossroads.
The budget came against the backdrop of the share of Indian Railways in the movement of goods, vis a vis truckers, falling from 24.07 percent in 2001-02 to 20.89 percent in 2008-09 and further to 19.32 percent in the first 10 months of this fiscal.
Yet, the minister said this fiscal will end with a net profit of Rs.1,328 crore. She added that the freight target for the coming fiscal will be 944 million tonnes.
Indian Railways runs the world's second largest network under a single management with a network of 64,099 route km to ferry 18.9 million passengers on 7,000 trains daily from 6,906 stations. It also runs 4,000 freight trains to carry 850 million tonnes of cargo.
The main highlights of the 2010-11 railway budget include:
-- No increase in passenger fares
-- Rs.100 reduction in freight per wagon for fertilisers and kerosene
-- Free travel for cancer patients in 3rd AC classes
-- Cost-sharing in public-private-partnership (PPP) mode in some gauge-conversion projects
-- Further extension of Kolkata Metro on priority basis; stations to be named after Bahadur Shah Zafar, Tagore family
-- Karmabhoomi trains to be introduced for migrant labour
-- New Janmabhoomi train between Ahmedabad and Udhampur
-- Special 'Bharat Teertha' train to be run around India to commemorate Rabindranath Tagore's 150th birth anniversary
-- Railway line to be extended from Bilaspur in Himachal Pradesh to Leh in Jammu and Kashmir
-- Andaman and Nicobar Islands to get railway line from Port Blair to Diglipur
-- Sikkim capital Gangtok to be connected by rail from Rangpo
-- 2011 being 150th anniversary of Rabindranath Tagore, special train to be run from West Bengal to Bangladesh
-- Gross earnings in 2009-10 estimated at Rs.88,281 crore
-- Working expenditure in 2009-10 estimated at Rs.83,440 crore
-- Expenses during 2010-11 estimated at Rs.87,100 crore
-- Thrust on expansion in 2010-11 with allocation of Rs.4,411 crore
-- Kashmir rail link to be extended to Sopore in the north of the valley
-- Net profit of Rs.1,328 crore in 2009-10
-- 10 automobile ancillary hubs to be created
-- Twenty-two million energy saving CFLs for lighting distributed already
-- Policy decision to employ one member of family whose land is requisitioned for railway projects
-- North-south, east-west dedicated freight corridors to be created
-- Construction of high-speed passenger rail corridors envisaged
-- More multi-functional hospitals to be set up
-- Educational facilities to be set up for children of 80,000 women families
-- Special facilities to be established for gangmen
-- Insurance facilities for licensed porters as part of railway's corporate social responsibility
-- Centre for railway research to be established with Indian Institutes of Technology and Defence Research and Development Organisation
-- Will involve unions in policy making
-- Integral Coach Factory Chennai to be further modernised
-- New wagon repair shop in Mumbai
-- Design, development and testing centre for railway wheels at Bangalore
-- Within five years, all unmanned level crossings to be manned
-- Construction of more underpasses, besides road overbridges
-- Greater coordination with state governments to protect railway property
-- Security of women passengers to be improved
-- Ex-servicemen to be employed in Railway Protection Force
-- Five sports academies to be set up
-- Astroturf to be provided for development of hockey
-- Employment opportunities for sports persons
-- Railways to be lead partner for Commonwealth Games
-- Special drive to increase passenger amenities
-- Upgrade of 94 stations
-- Six new drinking water bottling plants in PPP mode
-- Modern toilets at railway stations
-- More ticketing centres to help the public
-- Acquisition of cutting edge safety technology
-- 1,000 route km to be created
-- Special task force for clearing investment proposals in 100 days
-- New business model to be created
-- No privatisation of railways
-- But greater participation of private sector
-- 117 of 120 new trains for current fiscal to be flagged off
'We have saved Rs.2,000 crore ($40 million) because of the hard work of our employees and austerity measures. There will be no increase in passenger fares,' Railway Minister Mamata Banerjee told the Lok Sabha, the lower house of Parliament.
'Our objective is inclusive growth,' she said in her marathon 110-minute speech, adding that her main consideration was social responsibility of Indian Railways rather than mere commercial viability of various projects.
Accordingly, she also announced a cut in freight tariff for kerosene and grain, upgrade of 94 stations, 522 diagnostic centres, target of 1,000 km new lines, 10 auto ancillary hubs, several high-speed passenger rail corridors, six new drinking water plants and housing for all railway staff in 10 years.
'We have set our goals in the Vision 2020 document and we will achieve it,' the minister said, referring to the document unveiled in December that has targeted making over 30,000 km of routes into double or multiple lines against 18,000 km today.
'It is a fact that administrative and procedural delays discourage potential investors. We will need to overcome this. I am setting up a special task force for this,' said the minister, dressed in a white and green sari and her trademark rubber slippers.
'Special structure will be created for the new business model,' she said, emphasising: 'But we will not privatise railways. Indian Railways will remain with the government.'
At the same time, she also asked the private sector to refrain from what she called the 'typical negative approach' while dealing with the Indian Railways. 'I am sorry to say this -- this mindset has to change.'
She, nevertheless, said a special task force will be set up to clear proposals for investments within 100 days and that policy guidelines in this regard will be made easy, simple and investment friendly to attract funds to the sector.
Prime Minister Manmohan Singh, United Progressive Alliance (UPA) chairperson Sonia Gandhi, Leader of Opposition Sushma Swaraj and Finance Minister Pranab Mukherjee were among those in the house, presided over by Speaker Meira Kumar.
This was Banerjee's fourth budget of her career as railway minister and the second for the United Progressive Alliance (UPA) government in its second straight term after being voted back to office in May last year.
According to Banerjee, 117 out of the 122 new trains promised in her last budget will be flagged off by March 31, within a matter of seven months, which was a commendable effort.
Seeking to give safety issues due consideration, the minister said there were a few cases of unfortunate accidents in the past and said these would be prevented by adopting the highest level of technology and manpower training.
'Within five years, we will have 13,000 out of unmanned level crossings manned - 3,000 this fiscal and 1,000 in the coming fiscal,' she said, referring to the high number of accidents at such crossroads.
The budget came against the backdrop of the share of Indian Railways in the movement of goods, vis a vis truckers, falling from 24.07 percent in 2001-02 to 20.89 percent in 2008-09 and further to 19.32 percent in the first 10 months of this fiscal.
Yet, the minister said this fiscal will end with a net profit of Rs.1,328 crore. She added that the freight target for the coming fiscal will be 944 million tonnes.
Indian Railways runs the world's second largest network under a single management with a network of 64,099 route km to ferry 18.9 million passengers on 7,000 trains daily from 6,906 stations. It also runs 4,000 freight trains to carry 850 million tonnes of cargo.
The main highlights of the 2010-11 railway budget include:
-- No increase in passenger fares
-- Rs.100 reduction in freight per wagon for fertilisers and kerosene
-- Free travel for cancer patients in 3rd AC classes
-- Cost-sharing in public-private-partnership (PPP) mode in some gauge-conversion projects
-- Further extension of Kolkata Metro on priority basis; stations to be named after Bahadur Shah Zafar, Tagore family
-- Karmabhoomi trains to be introduced for migrant labour
-- New Janmabhoomi train between Ahmedabad and Udhampur
-- Special 'Bharat Teertha' train to be run around India to commemorate Rabindranath Tagore's 150th birth anniversary
-- Railway line to be extended from Bilaspur in Himachal Pradesh to Leh in Jammu and Kashmir
-- Andaman and Nicobar Islands to get railway line from Port Blair to Diglipur
-- Sikkim capital Gangtok to be connected by rail from Rangpo
-- 2011 being 150th anniversary of Rabindranath Tagore, special train to be run from West Bengal to Bangladesh
-- Gross earnings in 2009-10 estimated at Rs.88,281 crore
-- Working expenditure in 2009-10 estimated at Rs.83,440 crore
-- Expenses during 2010-11 estimated at Rs.87,100 crore
-- Thrust on expansion in 2010-11 with allocation of Rs.4,411 crore
-- Kashmir rail link to be extended to Sopore in the north of the valley
-- Net profit of Rs.1,328 crore in 2009-10
-- 10 automobile ancillary hubs to be created
-- Twenty-two million energy saving CFLs for lighting distributed already
-- Policy decision to employ one member of family whose land is requisitioned for railway projects
-- North-south, east-west dedicated freight corridors to be created
-- Construction of high-speed passenger rail corridors envisaged
-- More multi-functional hospitals to be set up
-- Educational facilities to be set up for children of 80,000 women families
-- Special facilities to be established for gangmen
-- Insurance facilities for licensed porters as part of railway's corporate social responsibility
-- Centre for railway research to be established with Indian Institutes of Technology and Defence Research and Development Organisation
-- Will involve unions in policy making
-- Integral Coach Factory Chennai to be further modernised
-- New wagon repair shop in Mumbai
-- Design, development and testing centre for railway wheels at Bangalore
-- Within five years, all unmanned level crossings to be manned
-- Construction of more underpasses, besides road overbridges
-- Greater coordination with state governments to protect railway property
-- Security of women passengers to be improved
-- Ex-servicemen to be employed in Railway Protection Force
-- Five sports academies to be set up
-- Astroturf to be provided for development of hockey
-- Employment opportunities for sports persons
-- Railways to be lead partner for Commonwealth Games
-- Special drive to increase passenger amenities
-- Upgrade of 94 stations
-- Six new drinking water bottling plants in PPP mode
-- Modern toilets at railway stations
-- More ticketing centres to help the public
-- Acquisition of cutting edge safety technology
-- 1,000 route km to be created
-- Special task force for clearing investment proposals in 100 days
-- New business model to be created
-- No privatisation of railways
-- But greater participation of private sector
-- 117 of 120 new trains for current fiscal to be flagged off
Sunday, February 14, 2010
FIIs bullish on India, up stake in more companies...
Source: Indian Express
Foreign institutional investors' (FIIs) faith in the Indian stock markets is on the rise despite volatile market conditions and the economy witnessing an early stage on recovery. FIIs have not only increased their stake in companies but also added more firms under their belt, said CNI Research, a leading listed research body exclusively focusing on small and mid-cap companies in India.
CNI Research has found that FIIs have increased their stake in over 322 companies in Q3 (December quarter) as against 240 companies in Q2, showing the faith of foreign investors in India and the trend of rising investments in the country.
Among 322 companies, FIIs' holding increased by up to 2% in 259 cases over the previous period, from 2% to 5% in 51 firms, from 5% to 10% in 7 companies and more than 10% in 5 firms. Of the companies where FII increased stake, 74.2% have witnessed an increased price.
Based on the analyses it was found that in 205 companies FIIs increased their holding by less than or equal to 1%. According to a study on the rise in companies stake prices at the end of the quarter, the rise was up to 10% in cases of 107 companies, while 89 of them witnessed a rise of 10% to 50% and 9 firms had a rise of over 50%.
An opportunity exists for investors to invest in the 205 companies which witnessed price rise offers. But, they have to be careful as the rise sometimes is very erratic and in some cases it is even above 50%. It is generally believed that investors should identify companies where FIIs have just started consolidating their stake. It is in this category that CNI Research has identified those companies where FIIs' holding has just started rising as the rise is not even 1%.
A close look at these firms will find that there were cases where FIIs have just started raising the stake and the price rise is below 10%, which in other terms can be called under-performers and can still offer investors an opportunity to invest. In a similar study in Q2, CNI Research had identified 28 companies having potential to deliver higher returns.
Various filters were applied and the optimum mix where FIIs buying had just started and price rise was minimal was used to identify these firms
Foreign institutional investors' (FIIs) faith in the Indian stock markets is on the rise despite volatile market conditions and the economy witnessing an early stage on recovery. FIIs have not only increased their stake in companies but also added more firms under their belt, said CNI Research, a leading listed research body exclusively focusing on small and mid-cap companies in India.
CNI Research has found that FIIs have increased their stake in over 322 companies in Q3 (December quarter) as against 240 companies in Q2, showing the faith of foreign investors in India and the trend of rising investments in the country.
Among 322 companies, FIIs' holding increased by up to 2% in 259 cases over the previous period, from 2% to 5% in 51 firms, from 5% to 10% in 7 companies and more than 10% in 5 firms. Of the companies where FII increased stake, 74.2% have witnessed an increased price.
Based on the analyses it was found that in 205 companies FIIs increased their holding by less than or equal to 1%. According to a study on the rise in companies stake prices at the end of the quarter, the rise was up to 10% in cases of 107 companies, while 89 of them witnessed a rise of 10% to 50% and 9 firms had a rise of over 50%.
An opportunity exists for investors to invest in the 205 companies which witnessed price rise offers. But, they have to be careful as the rise sometimes is very erratic and in some cases it is even above 50%. It is generally believed that investors should identify companies where FIIs have just started consolidating their stake. It is in this category that CNI Research has identified those companies where FIIs' holding has just started rising as the rise is not even 1%.
A close look at these firms will find that there were cases where FIIs have just started raising the stake and the price rise is below 10%, which in other terms can be called under-performers and can still offer investors an opportunity to invest. In a similar study in Q2, CNI Research had identified 28 companies having potential to deliver higher returns.
Various filters were applied and the optimum mix where FIIs buying had just started and price rise was minimal was used to identify these firms
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