Archive for January, 2010

USD-INR retracing the fall

The USD/INR retraced the highs of 45.28 and has settled at around 45.78 levels. Equity markets were directionless with the Sensex and the Nifty closing a tad lower than last week. The high point from the data point was the 11.3 % growth in IIP against expectation of 10%. Inflation for the month of December was 7.31% which was as per expectation. In Euro news, the ECB kept rates unchanged but reiterated the need for fiscal discipline from its member states. While we expect the USD/INR to be more weighed by foreign inflows and underlying strength of the Indian economy, momentary surges in the US dollars may take the pair back above 46 levels.

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IFRS:Why do we need IFRS in India?

Do we need IFRS in India?

Indian Companies are listed on overseas stock exchange and have to prepare accounts with respect to GAAP followed in respective countries. Foreign companies having subsidiary in India have to prepare there accounts in order to meet overseas reporting.

FDI and FII’s are more comfortable with one global accounting language which can be understood globally.

Applicability of IFRS for Indian concerns

Currently IFRS has been made applicable from the reporting year 2011 (or 2011-12, as the case may be) by Ministry of Corporate Affairs for the following:

-Listed companies

-Bank, Insurance companies, mutual funds and Financial Institutions More >

Opening as professional trader with KREDENT

Excellent Opportunity: Opening as professional trader with KREDENT

We are glad to invite applications for our Professional Derivatives Trading desk.

Kredent trading desk is one of the largest trading desk in India with substantial market share in exchange’s volume and liquidity. Kredent is the direct clearing and trading member of the NSE, MCX-SX, MCX, NCDEX and BSE. More >

Infosys result analysis

Infosys declared its third quarter result today. The results came better than than the street expectations. The sales were around 3% above the Bloomberg consensus estimate, whereas the net profit was around 12% below, which was boosted on account of higher other income.

BSE                    :              INFOSYS

NSE                   :              INFOSYSTCH

Bloomberg     :              INFO IS Equity

CMP                  :              Rs. 2,587.45

Sector              :              IT Services

View                 :          Neutral with positive bias

RESULT HIGHLIGHTS:

  • The consolidated net sales for the quarter ended December 09 contracted by 1% to Rs. 5,741 cr, this was mainly on account of recovery by the North American Financial Services Sector
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IIP Data: November 2009 -Index for Industrial production

  • The IIP figure for November stood at 11.7%, taking everybody’s breath away. It stunned everybody since the market’s expected figures was hovering around 10%.The same index registered a growth of 2.4% y-o-y in Nov’08 whereas a growth of 10.3% (revised) y-o-y in the last month
  • It grew at its fastest pace in two years which was the after-effects of the festive season and also strong global cues. It thus supported the story of improved industrial activity in the last few months and thus, is an indication of a faster economic recovery in India
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Fourteen Companies: One Market

  • In a first of its kind scenario in 2010 , at least 14 national brands will promote the same value proposition- mobile voice
  • With the advent of new players and introduction of the tariff wars the listed telecom companies have already shed close to $40 billion in market value
  • While the top four operators own about three-fourth of the market of around 500 million users, Idea and Aircel who are relatively younger and the new entrants are clear threats to the established lot
  • The biggest challenge for a mega brand is to fight brand fatigue and the new entrants push the larger players to lower tariffs to their entire base, hitting them where it hurts most
  • These brand wars are both unprecedented and unaffordable
  • A two-year battle can make the ride rough for the mega brands

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Indian Economy – Annual Review and Analysis

“Hello readers…warm wishes for the year ahead on behlaf of MoneyBol team. My apologies for delayed posting of the monthly update. To make amends I have also updated the yearly review. Hope these are useful and informative for you.” – Praveen Bajaj,

Equity- BSE Sensex

Stocks started the month with a 200+ points gain on the first day but later started retreating touching a monthly low of 16601. Towards the end, stocks regained bullish momentum and in 6 trading days zoomed 863 points to close the year 2009 at 17464, gaining 3.18% since November’09.

Sensex

Sensex

Stocks started the year 2009 with a pessimistic note amid fears of global recession. Consequently Sensex remained subdued in the beginning of the year and touched a low of 8047 in March, 1600 points down from 9647 as on December 31. While the world economy is still trying to recover from the slowdown, Indian stock markets picked up quite early and since March, stocks have been on a rising path. Sensex closed the year at the highest closing for the year, 17464, returning 81% since December last year

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Buy Bayer Crop Science

Bayer Crop Science (CMP: Rs. 498.00)

Investment Rationale

• BSCL, an agro-chemical company, is subsidiary of the Euro 35 billion Bayer AG

• Its business is divided into crop protection, environmental science and bio-science

• Per hectare consumption of pesticide in India is merely 0.48 kgs, lower than 5.0 kgs per hectare in the US and again less than 10.0 kgs per hectare in Japan

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Crash and carry – New reserach suggests a way to make steady profits from the carry trade

  • Carry trade strategy : buying (investing in) a high interest yielding currency and selling (borrowing) a low yielding currency
  • Yen is favoured funding currency for the carry trade due to low interest rates in Japan
  • Dollar has become the next favoured one due to the economic crisis and near-zero rates in America More >